The domestic equity benchmarks ended the session near the day's high on Wednesday, mirroring positive global shares. PSU banks corrected for second day in a row. As per provisional closing data, the barometer index, the S&P BSE Sensex, jumped 403.29 points or 0.87% at 46,666.46. The Nifty 50 index advanced 114.85 points or 0.85% at 13,682.70.
A possible approval of Moderna Inc's COVID-19 vaccine this week and progress in US stimulus talks lifted sentiment. The US Federal Reserve will issue an updated policy statement along with new economic projections on Wednesday. Traders will be watching closely for any changes to Fed view on when its benchmark policy rate might rise off zero.
In the broader market, the S&P BSE Mid-Cap index rose 0.87% while the S&P BSE Small-Cap index gained 0.88%.
Buyers outpaced sellers. On the BSE, 1856 shares rose and 1166 shares fell. A total of 176 shares were unchanged.
Kerala local body election update:
Counting of votes polled in Kerala local body elections is under way at 244 centres in the state. A total of 21,893 wards in 1,200 local self-governing bodies including 6 corporations, 941 village panchayats, 14 district panchayats and 87 municipalities, went to polls in three phases on 8, 10 and 14 December 2020.
Initial trends from the counting of votes to the local body elections in Kerala show a clear advantage for the ruling CPM-led Left Democratic Front (LDF) in most of the rural and urban local bodies. As per the latest updates, LDF leads in 514 grama panchayats, United Democratic Front (UDF) 376, and National Democratic Alliance (NDA) 23.
COVID-19 Update:
Total COVID-19 confirmed cases worldwide stood at 7,34,76,721 with 16,35,464 deaths. India reported 3,32,002 active cases of COVID-19 infection and 1,44,096 deaths while 94,56,449 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.
Primary Market:
The initial public offer (IPO) of Mrs. Bectors Food Specialities received bids for 10.77 crore shares as against 1.32 crore shares on offer on Wednesday (16 December 2020), according to the stock exchange data at 15:15 IST. The issue was subscribed 8.14 times.
The issue opened for subscription on Wednesday (15 December 2020) and it will close on Thursday (17 December 2020). The price band for the IPO is set at Rs 286-288 per share.
Buzzing Index:
The Nifty PSU Bank index slipped 1.66% to 1,803.10. The index has lost 3.10% in two sessions.
Union Bank of India (down 2.39%), Canara Bank (down 1.68%), Bank of Baroda (down 1.27%), CBI (down 1.02%), Bank of India (down 0.96%) and SBI (down 0.70%) declined.
Punjab National Bank (PNB) tumbled 6.41% to Rs 37.95. The capital raising committee of the bank, at its meeting held on 15 December 2020, authorised the opening of the QIP issue and approved the floor price of Rs 37.35 per equity share, the bank said in a regulatory filing. The floor price is at a 7.89% discount to Tuesday's closing price of Rs 40.55 per share. The capital raising committee of the bank will meet on Friday, 18 December 2020 to determine the QIP issue price.
"Our bank intends to utilize the net proceeds towards augmenting our bank's tier I capital to meet the basel III and to support growth plans and to enhance the business of our bank; and for general corporate requirements or any other purposes, PNB said in its draft placement document filed with the bourses.
IDBI Bank shed 0.35% to Rs 42.25. The bank launched a qualified institutional placement (QIP) of Rs 2000 crore (base size of Rs 1,000 crore and Rs 1,000 crore under green shoe option) to raise funds from institutional investors. The floor price for QIP is set at Rs 40.63 which is 4.17% discount to yesterday's closing price of Rs 42.40. The bank further said that a meeting of the committee is scheduled to be held on 18 December 2020 to consider and approve the issue price for the shares allotted in the QIP issue.
Earlier in October 2020, the bank's board at its meeting had proposed to raise Rs 6,000 crore by issuing shares through QIP. This issue has now been downsized to Rs 2000 crore.
Stocks in Spotlight:
Housing Development Finance Corporation (HDFC) rose 2.68% to Rs 2413.80. HDFC said it plans to issue secured redeemable non-convertible dentures (NCDs) of Rs 10 lakh each, aggregating to Rs 5,000 crore (base size of Rs 2,500 crore and Rs 2,500 crore under green shoe option) with a coupon rate of 4.23% per annum on a private placement basis. The NCDs will have a tenor of 14 months and will be redeemed on 18 February 2022.
The issue will open for bidding on 17 December 2020 and it will close on the same day. The object of the issue is to augment the long-term resources of the corporation. The proceeds will be utilized for financing or refinancing the housing finance requirements of the corporation.
Mahindra & Mahindra (M&M) added 1.98% to Rs 732.50. The auto maker announced that effective 1 January 2021, the company will increase the price of its range of passenger and commercial vehicles, across models. This has been necessitated due to the increase in commodity prices and various other input costs.
H.G. Infra Engineering jumped 5.32% to Rs 234.50. The company was declared as lowest bidder by IRCON International for a contract with bid price of Rs 784.99 crore. The scope of the order includes civil works like Earthwork for railway formation, blanketing work, minor bridges, major bridges, robs, rubs, fobs, track linking works (including supply of ballast but excluding supply of rails and sleepers), station building and other service buildings, staff quarters, platform work.
The project also includes general electrical works between Gevra Road to Sendurgarh double line and Urga to Kusmunda single line in the state of Chhattisgarh. HG Infra said the completion period is 30 months including monsoon period.
ABB India rose 3.63% to Rs 1195.10. The company completed a large-scale remote commissioning of winder drives, upgrading and commissioning PM5 installations at ITC's paperboards and specialty papers division mill in south-central India.
Global Markets:
Shares in Europe and Asia advanced on Wednesday following an overnight bounce on Wall Street as optimism grew over the prospect of more stimulus.
In Europe, the surge in coronavirus cases is the main focus for investors with several major economies, including Germany, Italy and the Netherlands, changing Christmas plans to relax restrictions in order to curb a sharp rise in cases.
In Asia, the Bank of Japan has decided to tap $6 billion in cash from a government account in a rare arrangement to ensure it has enough ammunition to combat any market disruptions caused by a recent resurgence in coronavirus infections. Under the arrangement announced on Wednesday, the central bank will buy dollar cash from the Ministry of Finance any time through to the end of March next year at the prevailing market exchange rate at the time.
Japan's exports declined 4.2% in November as compared with a year ago, according to Ministry of Finance data released Wednesday.
Moderna Inc's COVID-19 vaccine appears set for regulatory authorisation in the United States this week, while rollouts of the country's newly approved vaccine were expanded. Across the Atlantic, Europeans are set to start getting coronavirus vaccines before the new year after the regional drug regulator accelerated its approval process.
US stocks rose sharply on Tuesday as traders grew more optimistic about Congress passing another economic relief package. The Nasdaq closed at a record high.
Optimism over a $1.4 trillion U.S. spending package increased after House of Representatives Speaker Nancy Pelosi reportedly invited other top congressional leaders to meet late on Tuesday to hammer out a deal to be enacted this week.
Markets will now look to the U.S. Federal Reserve for new projections on whether the economy will suffer a double-dip recession or is on the cusp of a vaccine-inspired boom. The central bank is to release a statement on Wednesday.
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