The broader market was in line with benchmark index. The S&P BSE Mid-Cap index rose 1.26% while the S&P BSE Small-Cap index gained 1.72%.
The market breadth was titled in the favor of bulls. On the BSE, 1532 shares rose and 735 shares fell. A total of 158 shares were unchanged. In Nifty 50 index, 34 stocks advanced while 16 stocks declined.
RBI Governor's address:
The Reserve Bank of India (RBI) Governor Shaktikanta Das addressed the media at 10:00 am today, 17 April. This was his second press briefing since the COVID-19 outbreak began in India.
Das said macro economic situation has deteriorated. IMF says global economy may plunge into worst recession since great depression. India is estimated to have highest growth among G20 countries as per IMF. India is expected to show a sharp turnaround post the COVID-19 crisis. The country is expected to post a sharp turnaround in FY22 with 7.4% growth as per IMF, Shaktikanta Das added.
Among fresh liquidity measures, RBI announced targeted long-term repo operations (TLTRO) 2.0 to conduct long-term repo operations--Rs 50,000 crore to begin with--in tranches of appropriate sizes. The move will boost the liquidity in the market.
In addition, it also announced Rs 50,000 crore to national financial institutions such as NABARD, SIDBI and NHB to enable them to meet sectoral credit needs. This will comprise Rs 25,000 crore to NABARD for refinancing regional rural banks (RRBs), cooperative banks and micro finance institutions (MFIs); Rs 15,000 crore to SIDBI for on-lending/refinancing; and Rs 10,000 crore to NHB for supporting housing finance companies (HFCs).
The central bank slashed reverse repo rate by 25 basis points to 3.75%. Reverse repo rate is the rate at which the RBI borrows from the banks. However, the policy repo rate remains unchanged at 4.40%, and the marginal standing facility rate and the bank rate remain unchanged at 4.65%.
The RBI governor also said that the 90-day NPA norm would now not apply on moratorium granted on existing loans by banks. The loans given by NBFCs to real estate companies will also get similar benefit as given by scheduled commercial banks.
The central bank has also asked all banks to not make any further dividend payout in view of the financial difficulties arising from the Covid-19 crisis.
In order to support banks, their liquidity capital ratio (LCR) requirements have been brought down to 80% from 100%. This will be restored in phases by April next year.
Stocks in Spotlight:
Eicher Motors (up 5.91%), Bajaj Finserv (up 4.75%), Maruti Suzuki India (up 4.14%), Axis Bank (up 3.62%) and IndusInd Bank (up 3.51%) advanced.
Tech Mahindra (down 3.05%), Hindustan Unilever (down 2.55%), Nestle India (down 2.54%), Titan Company (down 1.82%) and Bharti Infratel (down 1.66%) declined.
TCS rose 5.53% to Rs 1810.40. On a consolidated basis, TCS reported 0.85% fall in net profit to Rs 8,049 crore on 0.03% rise in total income to Rs 40,684 crore in Q4 March 2020 over Q3 December 2019. Sectorally, Q4 revenue growth was led by Life Sciences & Healthcare (+16.2%), Communications & Media (+9.3%) and Manufacturing (+7%). Retail & CPG grew +4.2% and Technology & Services grew +3.5%. BFSI revenue declined 1.3%. From a geographical perspective, the Q4 growth was led by Europe (+11.9%) and UK (+5.4), Latin America grew +39%, Asia Pacific grew +3.5% and MEA grew +13%. North America grew +0,2% while India declined 1.9%.
Mahindra & Mahindra's (M&M) wholly owned step-down subsidiary, Mahindra Renewables (MRPL), has completed the sale of the entire paid-up equity share capital of 1.20 crore equity shares held by the company in Divine Solren (DSPL) to CLP India, for a total consideration of Rs 124.47 crore. The transaction was initiated on 21 February 2020 and was expected to be completed by 31 May 2020. M&M rose 0.08% to Rs 357.15.
Larsen & Toubro gained 0.64% to Rs 914.85 after the buildings & factories business of L&T Construction has secured 'significant' orders from prestigious clients in India. The factories arm of the buildings & factories business has secured a design and build order from a cement manufacturer to execute and commission a 9,500 TPD cement plant at Ametha, Katni, Madhya Pradesh. As per the L&T's classification, the valuation of the 'significant' order stands between Rs 1,000 crore and 2,500 crore.
Tata Motors was up 0.94% at Rs 75.35. Fitch Ratings has downgraded the long-term issuer default rating (IDR) of Tata Motors (TML) to 'B' from 'BB-' and placed 'negative' outlook on the same. The downgrade reflects Fitch's significantly lower expectations for TML's profitability and cash flow over the next few years due to the effect of the coronavirus pandemic on demand and disruption to TML's Indian operations as well as to key auto markets globally that are served through its fully owned UK-based subsidiary, Jaguar Land Rover Automotive.
Global Markets:
European and Asian markets rose across the board on Friday on reports that a drug developed by Gilead Sciences was showing effectiveness in treating the coronavirus. Countries around the world including the U.S. and Germany, Europe's largest economy, are beginning to implement plans to lift lockdown measures as the rate of new cases declines.
Meanwhile, China's first quarter GDP shrank 6.8% in 2020 as compared to a year ago, according to data from the National Bureau of Statistics of China. That was the first quarterly decline since 1992, when official quarterly GDP reports started and a sharp drop from the 6% growth recorded in the fourth quarter of 2019.
US Dow index futures, meanwhile, soared 770 points as Boeing announced plans to resume commercial airline production.
Pharmaceutical company Gilead (GILD), which has been testing its one of its drugs as a potential treatment for coronavirus, popped more than 16% in after-hours trading following a report about early success in one of the drug trials. Covid-19 patients who are getting the drug, called remdesivir, have been recovering quickly, with most going home in days, the media reports suggested.
In US, stocks edged higher on Thursday on surging shares of Netflix and Amazon.com as investors anticipated big earnings from the coronavirus-induced slowdowns keeping people at home. President Donald Trump laid out new guidelines on Thursday for U.S. states to emerge from a coronavirus shutdown in a staggered, three-stage approach meant to revive the U.S. economy even as the country continues to fight the pandemic.
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