Domestic equity benchmarks ended a tad above the flat line on Thursday, with banks leading the gains. Select real estate stocks jumped after Maharashtra reduced stamp duty rates on apartments in the state. The Nifty failed to sustain above the 11,600 mark. Trading was volatile due to monthly F&O expiry.
The barometer index, the S&P BSE Sensex, advanced 39.55 points or 0.10% at 39,113.47. The Nifty 50 index gained 9.65 points or 0.08% at 11,559.25. It hit the day's high of 11,617.35 in early afternoon trade.
The Nifty has risen 2.18% in five sessions on optimism around coronavirus vaccines and pick up in business activity.
IndusInd Bank (up 6.59%), State Bank of India (up 2.81%), HDFC (up 2.62%) and Axis Bank (up 2.08%) were major index movers today.
Reliance Industries (down 1.18%) and HDFC Bank (down 0.51%) put pressure on indices.
In the broader market, the S&P BSE Mid-Cap index rose 0.01% while the S&P BSE Small-Cap index gained 0.35%. Both these indices advanced for the ninth straight session.
The S&P BSE Mid-Cap index has added 5% and the S&P BSE Small-Cap index jumped 8.45% in nine straight sessions.
COVID-19 Update:
Total COVID-19 confirmed cases worldwide stood at 24,181,120 with 8,25,794 deaths. India reported 7,25,991 active cases of COVID-19 infection and 60,472 deaths while 25,23,771 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.
Economy:
The Goods and Services Tax (GST) Council will hold its 41st meeting today, 27 August 2020 to discuss the single-point agenda of compensation to states for revenue losses under the indirect tax regime. The meeting will be held via video conferencing. Several options including expanding the ambit of compensation cess, market borrowing to fund compensation deficit along with a future plan for rate rationalisation beginning from correction of inverted duty structure for some items are expected to be discussed in the meeting.
Numbers to Watch:
The yield on 10-year benchmark federal paper fell to 6.147% as compared with 6.203% at close in the previous trading session.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 73.82, compared with its close of 74.30 during the previous trading session.
In the commodities market, Brent crude for October 2020 settlement fell 2 cents at $45.62 a barrel. The contract fell 22 cents, or 0.48% to settle at $45.64 a barrel in the previous trading session.
Foreign Markets:
European shares declined while Asian market ended on a mixed note on Thursday despite newly released data pointing towards continued recovery China's economy.
Profits at China's industrial firms grew 19.6% year-on-year to 589.5 billion yuan ($85.58 billion), the statistics bureau said on Thursday. It follows an 11.5% gain in June and the third straight month of profit growth in this year.
South Korea's Kospi shed 1.05%. The country's central bank kept its rates on hold on Thursday, but cut its 2020 GDP forecast, as it weighed concerns over rising house prices and the worsening coronavirus fallout.
The US stock market finished session at all-time closing highs on Wednesday, 26 August 2020, as risk sentiments buoyed by better than expected US durable-goods order data for July coupled with positive news on the COVID-19 vaccine front. Biotech firm Moderna announced promising results from a small trial of its coronavirus vaccine candidate in elderly patients.
Meanwhile, Fed Chairman Jerome Powell will speak Thursday during a virtual version of the Fed's annual Jackson Hole, Wyoming, conference. He is expected to outline what could be the central bank's most active efforts ever to spur inflation back to a healthy level.
US durable-goods orders jumped 11.2% in July on strong auto demand, the Census Bureau said on Wednesday, following June's 7.7% gain. The jump signaled a continued recovery in the nation's manufacturing industry, though the figures remain well below pre-pandemic highs.
Buzzing Indian Index:
The Nifty Realty index jumped 6.40% to 232.80, led by the Maharashtra-focused realty firms.
Oberoi Realty (up 7.06%), Sunteck Realty (up 6.87%), Godrej Properties (up 6.74%) and Kolte-Patil Developers (up 4.32%) advanced.
The Maharashtra Cabinet approved a proposal on Wednesday (26 August) to reduce stamp duty by 3% on all land or home sale transactions executed and registered between 1 September and 31 December, this year. There will be a 2% reduction on stamp duty from 1 January to 31 March 2021. The stamp duty rate, fixed by the state government, is payable on the sale agreement. In Maharashtra, existing stamp duty charges are 5% in major cities like Mumbai, Pune, Nagpur and Nashik, and 6% in others.
Stocks in Spotlight:
Hindustan Aeronautics (HAL) slumped 14.16% to Rs 1010.95 as the offer for sale (OFS) opened for non-retail investors today. Through the OFS, the government proposes to sell 3,34,38,750 equity shares, constituting 10% paid-up share capital of the company, with an option to sell an additional 5% stake or 1,67,19,375 equity shares (oversubscription option). The floor price for the OFS was set at Rs 1,001 each, a 15% discount to HAL's closing price of Rs 1177.75 on Wednesday.
The OFS opened on Thursday (27 August) for non-retail investors, while both retail as well as non-retail investors will be able to subscribe on Friday (28 August). A total of 20% of the offer size will be reserved for retail investors, and they will be allocated offer shares at a discount of 5% to the cut-off price in accordance with the OFS guidelines. As on 15:25 IST, the OFS received subscription for 4.25 crore shares or 159.13% against the base non-retail offer size of 2.67 crore shares.
ICICI Bank rose 0.80% and ICICI Securities fell 2.70%. ICICI Bank on Wednesday said it will sell up to 2% of its holding in ICICI Securities through an open market transaction through an open market sale to comply with the minimum public float of the company.
Mahindra & Mahindra (M&M) gained 3.80% after the auto major signed a memorandum of understanding (MoU) with Israel-based REE Automotive to explore development and manufacturing of electric commercial vehicles for global markets. The MoU is primarily aimed at global markets with current global volume estimated over time at 200,000-250,000 units. Production would be scaled further to support additional volume in the global as well as Indian market.
Siemens shed 1.35%. The board of Siemens has approved the sale of its mechanical drives (MD) business for Rs 440 crore to Flender Drives, a subsidiary of Flender GmbH, which in turn is a subsidiary of Siemens AG. The sale and transfer of MD business is as going concern and on a slump sale basis, with effect from 1 January 2021. The MD business within Siemens achieved revenue of Rs 683.80 crore for FY19 and had an operating loss of Rs 55.30 crore.
Indraprastha Gas lost 1.61%. The natural gas distributor's consolidated net profit dropped 85.64% to Rs 35.18 crore on 58.96% fall in total income to Rs 675.12 crore in Q1 June 2020 over Q1 June 2019. The company's CNG sales volume declined 66% to 105 million kgs in Q1 June 2020 over Q1 June 2019. Total PNG sales fell 30% YoY to 101 million scm in quarter ending June 2020.
Rossari Biotech added 0.26%. SBI Mutual Fund added 2.34 lakh shares or 0.45% stake of Rossari Biotech via open market on 25 August 2020. Following the acquisition, SBI Mutual Fund's stake in the company increased to 5.25% from 4.80% earlier.
Blue Star jumped 9% after the company won an order valued at Rs 149 crore for electrical & mechanical works for Mumbai Metro Line III from Dogus-Soma JV.
GMDC skid 0.20%. The mining company's consolidated net profit jumped 42.8% to Rs 136.11 crore on 52.4% decline in net sales to Rs 240.11 crore in Q1 June 2020 over Q1 June 2019. On the segmental front, Mining revenue was at Rs 203.19 crore (down 53.7% YoY) and the Power revenue was at Rs 58.79 crore (down 34.5% YoY) during the quarter.
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