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5 feb (3)

Market breadth turns negative.

Equity indices were trading with modest gains in mid-morning trade. The Nifty regained the 14,900 mark after slipping below that level. Financial shares were in demand for fifth trading day. The Reserve Bank of India (RBI) kept the repo rate unchanged at 4% while the stance remained ‘accomodative’.

The barometer index, the S&P BSE Sensex, was up 308.19 points or 0.61% at 50,922.04. The Nifty 50 index gained 0.51% at 14,970.85.

The Sensex scaled record high of 51,073.27 while the Nifty hit record high of 15,014.65 level in early trade.

The broader market corrected. The S&P BSE Mid-Cap index was down 0.56% while the S&P BSE Small-Cap index was up 0.01%.

The market breadth turned negative. On the BSE, 1266 shares rose and 1363 shares fell. A total of 154 shares were unchanged.

RBI MPC Outcome:

The meeting of the six-member Monetary Policy Committee headed by RBI Governor Shaktikanta Das concluded this morning. The committee has kept the interest rates unchanged, maintaining repo rate at 4% and the reverse repo rate at 3.35%.

The MPC decided to continue with an accommodative stance of monetary policy as long as necessary, at least through the current financial year and into next year to revive growth on a durable basis and mitigate the impact of Covid-19, Das said.

Inflation has been better than what was expected in December meeting and eased below tolerance level of 6%. The RBI projected GDP growth of 10.5% in FY22 for India while projection for CPI-based inflation was revised to 5.2% for Q4FY21.

The RBI had last revised its policy rate on 22 May 2020 to perk up demand by cutting interest rate to a historic low. The latest Economic Survey said that there are expectations of a rebound of the economy with a 11% growth in the next fiscal.

New Listing:

Shares of Stove Kraft were trading at Rs 446.45 at 11:20 IST on the BSE, at a premium of 15.96% over the initial public offer price of Rs 385. The stock was listed at Rs 467, at a premium of 21.30% to the initial public offer (IPO) price. So far, the stock hit a high of Rs 495.55 and low of Rs 435.05. On the BSE, 6.55 lakh shares were traded on the counter so far. The IPO of Stove Kraft was subscribed 18.03 times. The issue opened for subscription on Monday (25 January 2021) and closed on Thursday (28 January 2021).

Buzzing Index:

The Nifty Financial Services gained 1.32% to 16,826, rising for fifth consecutive trading session. The Financial Services index surged 15.3% in five trading sessions.

SBI (up 12.79%), Kotak Mahindra Bank (up 4.14%), Piramal Enterprises (up 2.61%), HDFC Bank (up 1.17%), Power Finance Corporation of India (up 0.79%), HDFC (up 0.59%) and Bajaj Holdings (up 0.53%) were top gainers.

Earnings Impact:

Tata Power fell 1.67%. On a consolidated basis, the power utility company reported 28.4% rise in net profit to Rs 248.21 crore on 7.5% increase in net sales to Rs 7597.91 crore in Q3 FY21 over Q3 FY20. The company’s improved profitability was mainly due to better performance in Mundra, steady operational performance across all businesses and interest cost savings on account of debt reduction. Consolidated EBITDA was up 1% at Rs 1,997 crore in Q3 FY21 as compared to Rs 1,970 crore in Q3 FY20. Profit before tax in Q3 December 2020 stood at Rs 421.09 crore, up by 20.4% from Rs 349.74 crore in Q3 December 2019.

Gillette India rose 0.81% after the company’s standalone net profit jumped 15.2% to Rs 81.90 crore on a 13.3% increase in net sales at Rs 520.42 crore in Q2 December 2020 over Q2 December 2019. Gillette India (GIL) delivered strong sales on account of its superior strategy, robust product portfolio, strong retail execution and market recovery. Profit after Tax (PAT) grew due to its focus on productivity and savings. Standalone profit before tax (PBT) soared 37% to Rs 123.22 crore in Q2 December 2020 as against Rs 89.92 crore in Q2 December 2019.

Global Markets:

Asian markets were trading higher on Friday after overnight gains stateside that saw the S&P 500 and Nasdaq posting record closing highs.

U.S. stocks jumped on Thursday, extending the rally into a fourth straight day as investors assessed a new batch of corporate earnings and solid economic data. The S&P 500 and Nasdaq posted record closing highs.

On the stimulus front, Democrats are moving forward with President Joe Biden’s $1.9 trillion Covid-19 relief proposal. Republicans have countered with a more modest $618 billion package, which includes new stimulus checks of $1,000 per person.

Investment & trading in securities market is always subjected to market risks, past performance is not a guarantee of future performance.

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