The benchmark indices further extended losses during afternoon trade, trading close to day's low. The Nifty index held its 16,250 mark. The Reserve Bank of India kept repo rate unchanged at 4%.
At 13:20 IST, the barometer index, the S&P BSE Sensex, dropped 175.60 points or 0.32% at 54,317.24. The Nifty 50 index skid 35.60 points or 0.22% at 16,259.
Reliance Industries (RIL) (down 1.99%), Housing Development Finance Corporation (HDFC) (down 0.74%) and ICICI Bank (down 0.64%) dragged the market.
Broader markets outperformed the benchmark indices. The S&P BSE Mid-Cap index rose 0.30%. The S&P BSE Small-Cap index gained 0.33%.
Buyers outnumbered the sellers. On the BSE, 1,775 shares rose and 1,356 shares fell. A total of 108 shares were unchanged.
Foreign portfolio investors (FPIs) sold shares worth Rs 719.88 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 731.92 crore in the Indian equity market on 5 August 2021, provisional data showed.
COVID-19 Update:
Total COVID-19 confirmed cases worldwide stood at 20,09,26,244 with 42,67,726 deaths. India reported 4,14,159 active cases of COVID-19 infection and 4,26,754 deaths while 3,10,15,844 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.
Economy:
The Reserve Bank of India (RBI) kept the policy repo rate unchanged at 4% while maintaining its accommodative stance after the conclusion of the Monetary Policy Committee (MPC) meeting today, 6 August 2021.
RBI's MPC began its bi-monthly monetary policy deliberations on Wednesday, 4 August 2021. Following the meet, RBI on Friday (6 August 2021) kept the benchmark interest rate unchanged amid COVID-19 uncertainty. Repo rate (lending rate) will continue at 4% and reverse repo rate (RBI's borrowing rate) at 3.35%. The central bank has maintained an accommodative stance.
MPC sees CPI inflation at 5.7% in 2021-22 as against 5.1% projected earlier. The CPI inflation is expected to be 5.9% in Q2 FY22, 5.3% in Q3 FY22, 5.8% in Q4 FY22. The CPI inflation is projected to be at 5.1% in Q1 FY23. GDP growth is projected at 9.5% in Financial Year 2021-22.
Gainers & Losers:
Adani Ports & Special Economic Zone (APSEZ) (up 2.52%), IndusInd Bank (up 2.13%), Indian Oil Corporation (IOCL) (up 1.92%), Bharti Airtel (up 1.85%) and Tata Consumer Products (TCPL) (up 1.69%) were major gainers in Nifty 50 index.
Cipla (down 3.20%), Reliance Industries (RIL) (down 1.99%), Shree Cement (down 1.87%), Ultratech Cement Co. (down 1.73%) and Nestle India (down 1.03%) were major losers in Nifty 50 index.
Earning Impact:
Mahindra & Mahindra (M&M) rose 0.66%. The company's net profit before exceptional items surged to Rs 934 crore in Q1 FY22 from Rs 39 crore in Q1 FY21. The company's net profit after adjusting for exceptional items was Rs 856 crore in Q1 FY22 as against Rs 68 crore in Q1 FY21.
Revenue rose by 110% to Rs 11,763 crore in Q1 FY22 from Rs 5,589 crore in Q1 FY21. EBITDA increased by 185% to Rs 1,632 crore in the first quarter from Rs 573 crore reported in the same period last year. Total vehicles sold aggregated to 85,858 units in Q1 FY22, up by 190% from 29,619 units sold in Q1 FY21. Total tractors sold rose by 52% to 99,127 units in Q1 FY22 from 65,195 units in Q1 FY21.
The company's operating margin was at 13.9% despite COVID-19 challenges and commodity price increases. The company continued to focus on cost optimization and operating leverage helped maintain margins.
Global Markets:
European markets were muted across the board on Friday morning, 6 August 2021 as investors monitored a fresh round of corporate earnings and the global spread of the delta COVID-19 variant. The German industrial output fell unexpectedly by 1.3% in June 2021, its second consecutive monthly decline, according to the Federal Statistics Office.
The Bank of England on Thursday left its monetary policy unchanged, but warned of a more pronounced period of above-target inflation in the near term.
Asian stocks traded mixed on Friday as investors await the release of a closely watched US jobs report.
The major U.S. equity indexes rose Thursday and the S&P 500 set a new record closing high as energy and travel stocks bounced back ahead of a key labor market report.
The number of Americans filing new claims for unemployment benefits declined further last week. Initial claims for state unemployment benefits fell 14,000 to a seasonally adjusted 385,000 for the week ended July 31. The claims data was the last reading before the key July jobs report, which will be released on Friday morning. The jobs report is expected to be a key data point for the Federal Reserve as it considers when to tighten monetary policy.
A surge in imports of industrial supplies drove the US trade deficit to a record in June. The trade gap widened by $4.6 billion to $75.7 billion, a nearly 7% increase compared to May, the Commerce Department reported. Imports of goods and services jumped $6 billion, most of which was accounted for by the rise in industrial materials and supplies such as iron, steel and chemicals, as well as a $1.2 billion increase in non-monetary gold.
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