Sharp gains were capped as rising COVID-19 cases spooked investors. Introduction of new margin requirement in the cash segment from 1st September and geo-political tensions between India-China also impacted sentiment.
In broader market, the S&P BSE Mid-Cap index was up 0.69% while the S&P BSE Small-Cap index surged 1.12%.
The market breadth, indicating the overall health of the market, was strong. On the BSE, 1456 shares rose and 821 shares fell. A total of 143 shares were unchanged.
The Sebi's new margin rules came into effect from 1 September 2020. As per the new rule, it is mandatory for brokers to collect margins from investors upfront for any purchase or sale of shares. Failing to do so will attract a penalty.
COVID-19 Update:
Total COVID-19 confirmed cases worldwide stood at 25,938,122 with 861,679 deaths. India reported 8,15,538 active cases of COVID-19 infection and 67,376 deaths while 29,70,492 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.
Meanwhile, India continued to report one of the lowest COVID Case Fatality Rates (CFR) when compared to several other countries. While the global CFR stands at 3.3% as on date, the comparative figure for India is 1.76%, an official update noted today. The deaths per million population in India is one of the lowest in the world. While the global average is 110 deaths /million population, India is reporting 48 deaths /million population. The comparative figure for Brazil and the UK is 12 and 13 times higher, respectively.
Economy:
The IHS Markit India Services PMI rose sharply to 41.8 in August 2020 from 34.2 in July 2020. The index reached highest level since March, before the escalation of the global COVID-19 pandemic. Nevertheless, the reading is below the 50 which is a neutral value, indicating a continued decline in business activity.
Commenting on the latest survey results, Shreeya Patel, Economist at IHS Markit, said: "August highlights another month of challenging operating conditions in the Indian services sector. Sustained periods of closure and ongoing lockdown restrictions in both domestic and foreign markets have weighed heavily on the health of the industry. Output and new work continue to fall at solid rates, while restrictions meant that firms were often unable to complete projects. Backlogs of work accumulated to the greatest extent in almost 15 years of data collection. That said, the survey showed signs of a potential recovery. Business sentiment was neutral after being negative in the previous three months and employment fell at the softest pace since March. Additionally, there were efforts to protect profit margins, firms raised their selling prices to pass on higher expenses to customers and recover lost revenues after a period of closure."
Earnings Today:
Jubilant Industries (up 2.91%), MSTC (up 7.33%), Page Industries (up 0.22%), Panacea Biotech (up 0.16%) and Zuari Agro (up 2.58%) are some of the companies that will announce their quarterly earnings today.
Buzzing Segment:
Alcohol stocks were buzzing as government relaxed lockdown rules regarding liquor consumption. Karnataka government allowed bars and pubs to reopen for business with 50% seating capacity. Investors and traders are hoping that the same plan will be followed by other state governments.
Globus Spirits (up 5%), United Breweries (up 4.32%), United Spirits (up 2.26%), Associated Alcohols (up 1.79%) and Radico Khaitan (up 1.37%) advanced.
Stocks in Spotlight:
Escorts (down 1.33%), Indiabulls Housing Finance (down 1.2%) and Punjab National Bank (down 0.43%) were banned from trading in NSE's F&O segment after the securities crossed 95% of market wide position limit.
Tata Motors rose 2.13% to Rs 153.60 after the company's total sales increased 13.4% to 36,472 vehicles in August 2020 from 32,166 units sold during August 2019. Total domestic sales jumped 21.6% to 35,420 units in August 2020 from 29,140 units in August 2019. While the total commercial vehicles sales declined by 28% to 17,889 units, the total passenger vehicles sales surged 154% to 18,583 in August 2020 over August 2019.
Dish TV India hit an upper circuit of 5% at Rs 11.48 after consolidated net profit stood at Rs 74.54 crore in Q1 June 2020 compared with net loss of Rs 35.44 crore in Q1 June 2019. Consolidated net sales slipped 9.8% to Rs 835.58 crore in Q1 June 2020 over Rs 926.30 crore in Q1 June 2019. Subscription revenues fell 4.2% to Rs 791.50 crore in Q1 FY20 over Q1 FY19. EBITDA was at Rs 551.40 crore in Q1 June 2020, registering a growth of 1.5% quarter-on-quarter and 2.9% year-on-year. EBITDA margin was at 66%, recording an increase of 350 bps QoQ and 810 bps YoY.
Global Markets:
Overseas, Asian stocks were trading mixed on Thursday. Activity in Japan's services sector contracted at a faster pace in August. The final Jibun Bank Japan Services Purchasing Managers' Index (PMI) inched down to a seasonally adjusted 45.0 in August from 45.4 in the previous month, pressured by weakening new business and business expectations.
US stock market rose sharply on Wednesday, continuing a strong start to September for the market as traders took profits out of high-flying names like Apple and Tesla and snapped up shares in more beaten-down parts of the market. Both the S&P 500 and Nasdaq hit record highs, with the Nasdaq topping 12,000 for the first time.
The Dow Jones Industrial Average advanced 454.84 points, or 1.6%, to close at 29,100.50. It was the Dow's first close above 29,000 since February. The S&P 500 gained 1.5% to end the day at 3,580.84 while the Nasdaq Composite was higher by 1% at 12,056.44.
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