Key benchmark indices swayed between gains and losses in morning trade. The Nifty bounced back from early low of 11,366.90. Weak domestic economic data spoiled investors sentiment. The Supreme Court is set to deliver its verdict in the matter pertaining to the repayment of adjusted gross revenue (AGR) dues by telecom companies at 11:30 IST today.
At 10:29 IST, the barometer index, the S&P BSE Sensex, was up 145.15 points or 0.38% at 38,773.13. The Nifty 50 index was up 46.8 points or 0.41% at 11,434.10.
In broader market, the S&P BSE Mid-Cap index was up 0.13% while the S&P BSE Small-Cap index was fell 0.32%.
The market breadth was weak. On the BSE, 802 shares rose and 1310 shares fell. A total of 115 shares were unchanged.
COVID-19 Update:
Total COVID-19 confirmed cases worldwide stood at 25,405,845 with 849,389 deaths. India reported 7,85,996 active cases of COVID-19 infection and 65,288 deaths while 28,39,882 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.
Economy:
The headline seasonally adjusted IHS Markit India Manufacturing Purchasing Managers' Index stood at 52 in August 2020 from 46.0 in July signalling an improvement in operating conditions across the manufacturing sector following four consecutive months of contraction.
Commenting on the latest survey results, Shreeya Patel, Economist at IHS Markit said,"August data highlighted positive developments in the health of the Indian manufacturing sector, signalling moves towards a recovery from the second quarter downturn. The pick-up in demand from domestic markets gave rise to upturns in production and input buying. However, not all was positive in August, delivery times lengthened to another marked rate amid ongoing COVID-19 disruption. Meanwhile, employment continued to fall despite signs of capacity pressures, as firms struggled to find suitable workers. "The rate of input price inflation was solid, following four monthly declines in cost burdens. Firms, however, continued in their efforts to drive sales amid greater competitive pressure and reduced their selling prices further."
Domestic Macros:
India's GDP contracted 23.9% in Q1 June 2020 compared to the same period last year, showed official data released by the National Statistics Office (NSO) on Monday. This was mainly on account of limited economic activity in the country during the quarter amid lockdowns to control the spread of the coronavirus pandemic. The economy expanded 3.1% year-on-year in the quarter ended March 2020.
India's fiscal deficit stood at Rs 8.21 lakh crore, or 103.1% of the budgeted target for the current fiscal year upto the end of July 2020 exceeding its target in first four months of FY21. The Government of India has received Rs. 2,32,860 crore (10.4% of corresponding BE 2020-21 of Total Receipts) upto July, 2020 comprising Rs. 2,02,788 crore Tax Revenue (Net to Centre), Rs 24,614 crore of Non Tax Revenue and Rs 5,458 crore of Non Debt Capital Receipts.
AGR Hearing:
The Supreme Court will give its verdict today on the payment of AGR dues. The Govt has sought a 20 year time frame for paying AGR dues in a staggered manner while Vodafone Idea (up 3.83) and Bharti Airtel (up 1.17%) have sought 15 years. While Tata Teleservices (up 0.28%) has sought 7-10 years.
Buzzing Index:
The Nifty Metal index gained 1.33% to 2,452.80, snapping its two days losing streak.
JSW Steel (up 3.11%), Hindalco Industries (up 2.51%), Jindal Steel & Power (up 2.46%), Tata Steel (up 2.2%), Steel Authority of India (up 1.82%), National Aluminium Company (up 1.12%), Vedanta (up 1.01%) and Hindustan Zinc (up 0.68%) were top gainers in metal segment.
Stocks in Spotlight:
Escorts jumped 5.25% after the tractor maker on Tuesday (1 September) said it sold 7,268 tractors in August 2020, registering a growth of 80% as against 4,035 tractors sold in August 2019. Domestic tractor sales in August 2020 was at 6,750 tractors registering a growth of 79.4% as against 3,763 tractors in August 2019. Escorts said market sentiment continued to be highly positive with good monsoons, better Kharif sowing, crop prices holding up well and good supply of retail finance.
Spandana Sphoorty Financial declined 2.74% after the microfinance company reported a 36.9% decline in consolidated net profit to Rs 59 crore in Q1 June 2020 from Rs 93.4 crore in Q1 June 2019. Provision and write-off related to Covid-19 and others was Rs 89.30 crore in Q1 June 2020. The company's total income grew by 7.2% to Rs 327 crore in quarter ended 30 June 2020 from Rs 304.90 crore posted in quarter ended 30 June 2019. Consolidated profit before tax came at Rs 78 crore in Q1 June 2020, lower than Rs 143 crore in Q1 June 2019. The result was announced after market hours yesterday, 31 August 2020. The company's net interest income came at Rs 264 crore in Q1 June 2020 which is 37% higher than Rs 193 crore posted in Q1 June 2019. Net interest margin declined to 15.5% in Q1 June 2020 from 16.5% reported in the same period last year.
BEML gained 2.26%. The company bagged a order from Ministry of Defence for supply of 330 High Mobility Vehicles, for Pinaka project at a value of Rs 842 crore. Pinaka is a multi-barrel rocket launcher developed indigenously for the Indian Army and produced in India by involving Public Sector and Private Sector Defence Industries. The equipment will be manufactured by BEML at its Palakkad Plant in Kerala and would supply the vehicle platform to MoD in a span of 3 years. The multi-barrel launcher system is mounted on the highly rugged BEML truck, much acclaimed for its off-road mobility and would provide the Indian Army with vital manoeuvrability on the battlefield.
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