Market Wrap Podcast, Oct 20: Here's all that happened in the markets today

Bearing hammering continued on the bourses for a second straight day on Wednesday as investors booked profit at record high levels. Besides, a spike in US Treasury yields, which are at their highest level since April this year, coupled with a downgrade of Indian equities by global brokerage UBS soured sentiment on the Street.

UBS, in its Oct 20 report, downgraded India to "underweight" given rich valuations in the market. It says retail investors have played an outside role in the recent market rally, which while difficult to predict in terms of reversing, creates a potential headwind if this demand unwinds. Also, fading earnings momentum, less scope for economic rebound this year, low real yield, and expensive currency are some of the other reasons for downgrade given the vulnerability in a tapering environment.

They have, however, upgraded China from "underweight" to "overweight" on the back of likely bounce back in 2022, earnings growth expectations, and inexpensive valuation.

Against this backdrop, the 30-pack Sensex index ended 456 points lower at 61,260 while the Nifty50 index settled with a loss of 152 points at 18,267.

Bharti Airtel, SBI, Tata Motors, IndusInd Bank, Adani Ports, and Bajaj Finance were the top gainers on the Nifty50 index while Hindalco, BPCL, Titan, Bajaj Finserv, HUL, UPL, and PowerGrid were the top laggards.

In the broader markets, the BSE Midcap index shed 1.9 per cent to close at 25,915, and the Smallcap index tumbled 2.3 per cent to end at 28,879.

Among individual stocks, shares of IRCTC slipped 18 per cent to Rs 4,371 on the BSE in Wednesday's intra-day trade, amid heavy volumes, falling over 30 per cent in the past two trading days on account of profit booking.

The stock of the state-owned travel support services tanked 32 per cent from its record high level of Rs 6,393 touched in Tuesday’s intra-day trade amid buzz that the government is appointing a regulator for the rail sector. A sharp decline in stock price has seen the investors lose around Rs 32,352 crore wealth in the past two days. It ended over 17 per cent lower at Rs 4,433 level.

On the contrary, shares of Vodafone Idea ended over 6 per cent higher today after the telecom operator said its board has approved exercise of option of deferment of company's spectrum auction instalments for a period of four years. It's peer firm Bharti Airtel, too, ended 4 per cent higher on the BSE.

Besides, Paras Defence and Space Technologies (PDSTL) shares surged 9.8 per cent at Rs 1,001, on the BSE on Wednesday, on the back of huge volumes.

In the past three trading days, the stock of the defence company has surged 58 per cent after the scrip was shifted under B Group from T2T segment with effect from Monday, October 18, 2021. Further, in the past 12 trading days, the market price of PDSTL has more-than-doubled or has advanced 101 per cent. It is now up 473 per cent higher than its issue price on the BSE.

Sectorally, the trend remained largely negative with only Media and PSU Bank indices ending the day in the green.

Shares of fast moving consumer goods (FMCG) companies, for instance, were under pressure for the second straight day on Wednesday, falling nearly 5 per cent during the period, on concerns of slowing sales in the rural market.

On Tuesday, the country's largest FMCG company, Hindustan Unilever (HUL), posted a 9 per cent year-on-year rise in net profit at Rs 2,187 crore for the July-September quarter (Q2 of FY22). This was marginally lower than the Rs 2,195 crore estimated by Bloomberg. Following the Q2 results, the stock of HUL has declined 9 per cent from its Tuesday's intra-day high of Rs 2,732 on the BSE.

Among other FMCG stocks, Marico, VST Industries, Dabur India, Tata Consumer Products, Colgate-Palmolive (India), and ITC were down in the range of 1 to 3 per cent in the intra-day trade today.

Those of public sector banks, on the other hand, traded higher with the sector giant State Bank India hitting a new high on the expectation that the valuations for the sector would re-rate upwards, driven by an uptick in credit offtake going ahead.

SBI hit a new high of Rs 507.50 as the shares rallied 4 per cent in intra-day trade today. In the past one month, SBI has outperformed the market by gaining 15 per cent, as compared to a 5 per cent rise in the benchmark index.

On the earnings front, shares of Jubilant FoodWorks plunged 10 per cent on the BSE in the intra-day trade but ended 8.5 per cent lower after the company's same-store-sales growth came in at 26.3 per cent for the July-Sept quarter as against Street expectations of over 30 per cent. Overall, its profit came in at Rs 121.5 crore and revenue at Rs 1,100.7 crore

Now, Thursday's session will yet again be guided by global cues, weekly F&O, and corporate earnings. Asian Paints, Lemon Tree Hotels, Biocon, MphasiS, TVS Motors, Concor, Indian Hotel, and Indian Energy Exchange are some of the companies set to report their Q2 results tomorrow.