The S&P BSE Sensex ended 84 points, or 0.21 per cent higher at 40,594 levels. (Photo: Kamlesh Pednekar)
Paring the day's gains, the benchmark indices ended flat with a positive bias on Monday as the government's stimulus measures to boost demand failed to cheer investors. Finance Minister Nirmala Sitharaman today announced the government's two-pronged move to boost capital expenditure and stimulate consumer demand.
The S&P BSE Sensex ended 84 points, or 0.21 per cent higher at 40,594 levels while NSE's Nifty settled at 11,931, up 17 points, or 0.14 per cent. India VIX gained over 3.6 per cent to 21.12 levels.
In the broader market, the S&P BSE MidCap index slipped 0.48 per cent while the S&P BSE SmallCap index ended 0.4 per cent lower.
Global stocks hit five-week highs on Monday led by China’s post-holiday surge as investors bet on a steady recovery for the world’s no. 2 economy, but worries about rising Covid-19 infections capped gains in Europe and the United States.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1 per cent to 2-1/2-year highs, buoyed by a 3 per cent gain in Chinese blue chips and a 2.2 per cent rise by Hong Kong’s Hang Seng index.
In commodities, oil prices fell as force majeure at Libya’s largest oilfield was lifted, a Norwegian strike affecting production ended and US producers began restoring output after Hurricane Delta.
MARKET AT CLOSE | Gainers and losers on the S&P BSE Sensex
The S&P BSE Sensex gained 84 points, or 0.21 per cent to settle at 40,594 while NSE's Nifty ended at 11,931, up 17 points, or 0.14 per cent.
MADAN SABNAVIS | Capex measures to deliver the goods rather than the consumption booster
The fiscal announcements made by the Finance Minister (FM) on Monday are a combination of frontloading of consumption expenditure with some affirmative capex spending by both the central and state governments. The techniques being used for the two objectives are quite different, thus having a diluted impact on the fiscal balances. Overall the impact will be positive, though the extent will be limited. READ MORE
Is the Nifty on course to breeze past its 52-week high of 12,430.5?
Nifty reclaimed the 12,000 mark in trade on Monday - a level last seen in February 2020. The rally since February low has been mostly fueled by pharma, information technology (IT) services and automobile stocks. A large part of this, however, has also been on account of a sharp uptick in Reliance Industries (RIL) as the company emkarked upon a journey to become debt free, and raise money for its telecom venture - Jio Platforms via stake sale to marquee global investors. READ MORE
HDFC Bank slips 2%
Vedanta's structural problems behind its failed delisting attempt
Last week, a plan by Vedanta Ltd, to delist from the two Indian stock exchanges failed when shareholders declined to tender shares citing a low strike price. The failure is a setback for the mining-to-electricity conglomerate owned by London-based billionaire Anil Aggarwal to restructure his group’s businesses. But it is not the first time that attempts to reorganise his opaquely structured empire have met with controversy. READ MORE
Sensex trades flat with a negative bias
GDP growth: Modi govt now introduces schemes to boost consumer demand
In a bid to give a boost to the Covid-19-hit economy, the Modi govt has now turned its attention to boosting consumer demand. With that in mind, Finance Minister Nirmala Sitharaman on Monday announced new measures to encourage consumer spending. The FM announced the LTC Cash Voucher and Festival Advance Schemes to encourage government employees to spend more and generate demand. READ MORE
MARKET CHECK | Sensex slips into the red post FM presser, down over 80 pts
NEWS ALERT | Provision of additional Rs 25,000 cr budget
>> Rs 25,000 crore additional budget to be provided towards capital expenditure on roads, defence infra and domestically produced capital equipment, water supply, urban development;
>> This will be above provisions of Rs 4.13 trillion made in the Union Budget: FM
NEWS ALERT | Special loan to states
>> Of this special interest free 50-year loan, first part is of Rs 2,500 crore for North East (Rs 1,600 crore), Uttarakhand and Himachal Pradesh (Rs 900 crore).
>> The second part of this loan is of Rs 7,500 crore for other states, in proportion to share in Finance Commission devolution.
>> The third part of this loan is of Rs 2,000 crore for states that meet at least 3 out of 4 reforms given in Atma Nirbhar fiscal deficit package.
NEWS ALERT | Issuing an interest-free 50-year loan amounting to Rs 12,000 cr to states for capital expenditure: FM
>> This can be used for new or ongoing capital projects.
>> This can be used to settle bills of contractors or suppliers but it has to be spent before 31 March 2021.
>> This fund will be over and above all other additional borrowing ceilings given to States
NEWS ALERT | We want to now give a new thrust to states, Centre capex, says FM
Capital expenditure has a high multiplier effect: FM
NEWS ALERT | We are reviving the special festival advance scheme, says FM
>> Rs 10,000 interest-free advance to be repaid in 10 installments and it’s available up to March 31, 2021;
>> This will be given as a pre-paid RuPay card: FM
NEWS ALERT | Rupay card
Govt employees will get a pre-loaded Rupay card for Rs 10,000. Govt to bear bank charges. Ensures digital mode of payment, resulting in tax revenue and encouraging honest businesses
NEWS ALERT | Demand infusion in the economy estimated at Rs 19,000 cr approximately, says FM
>> Demand infusion by state govt employees will be Rs 9,000 crore
NEWS ALERT | In lieu of one LTC during 2018-21, cash payment will be made as follows
>> Full payment on leave encashment and
>> Payment of fare in 3 flat-rate slabs depending on class of entitlement
>> Fare payment to be tax-free
But this money has to be spent:
>> On goods attracting GST of 12% or more (GST invoice is a must)
>> Through digital mode
Employees opting for this scheme will br required to buy goods or services worth 3 times the fate and one-time leave encashment before 31 March, 2021.
NEWS ALERT | Govt employees need to be incentivised to contribute to the revival of demand for the benefit of the less fortunate: FM
>> Some indications show savings have increased for govt sector employees;
>> Govt employees can opt to buy goods/services worth 3 times the fare and 1 time the leave encashment
NEWS ALERT | FM lists two components for boosting consumer demand
>> LTC cash voucher scheme
>> Special festival advance scheme
NEWS ALERT | Proposals are designed in a way to stimulate demand by advancing some of the expenditure, says FM
>> Others are directly linked to increase in GDP: FM
NEWS ALERT | FM Nirmala Sitharaman begins the presser
>> The Indian government will announce stimulus package to boost demand in the economy
BUZZING STOCK:: Jindal Stainless surges 15%
Manipur, Telangana, Arunachal Pradesh emerge as the new stock trading hubs
The Nifty reclaimed 12,000 mark in trade on Monday after nearly eight months. The last time it traded around these levels was in February 2020, ahead of the Covid-19 induced nationwide lockdown. The rally since then, experts say, has been partly fueled by retail investors who took to investing in equities in the hope of better return over time as compared to the other asset classes. READ MORE
MARKET CHECK | Sensex pares gains, up 98 pts
MARKET UPDATE:: Volatility index, India VIX, rises 6%
Tata Power updates on the Mumbai power cut
At 10.10 am there were simultaneous substation tripping in MSETCL's Kalwa, Kharghar causing a huge dip in frequency in the Mumbai transmission system which led to tripping of Mumbai power supply. Restoration work in is in progress to bring supply from the 3 Hydro units and
Titagarh Wagons (TWL) reported its Q4FY20 results pursuant to amalgamation of its subsidiaries CIMMCO and Titagarh Capital with the parent company. Covid-19 impact led to Q4FY20 standalone revenues declining 22% YoY while adjusted PAT fell 37% YoY. On the positive side, the company has won ~INR5.4bn wagon orders from Indian Railways (IR) and debt has declined. Building in the wagon order win, we raise FY21/22E earnings by 63%/56% and PE multiple from 13x to 15x. Maintain ‘BUY’ with a revised SoTP‐based target price of Rs 61 (Rs 58 earlier) as we roll forward the valuation to December 2021E.
ITC rallies over 4%; stock top gainer on BSE Sensex
Shares of ITC rallied as much as 4.37 per cent to Rs 175.20 apiece on the BSE on Monday after reports said global brokerage firm CLSA has upgraded the stock to "Outperform" from "Buy" with the target price of Rs 220 per share. At 11:05 AM, the stock was trading over 2.75 per cent higher at Rs 172.50 on the BSE against Friday's close of Rs 167.85. In comparison, the benchmark S&P BSE Sensex was trading 0.5 per cent higher at 40,712 levels. READ MORE
Is the Nifty on course to breeze past its 52-week high of 12,430.5?
Nifty reclaimed the 12,000 mark in trade on Monday - a level last seen in February 2020. The rally since February low has been mostly fueled by pharma, information technology (IT) services and automobile stocks. A large part of this, however, has also been on account of a sharp uptick in Reliance Industries (RIL) as the company emkarked upon a journey to become debt free, and raise money for its telecom venture - Jio Platforms via stake sale to marquee global investors. That apart, the acquisition of Future Group and the ensuing stake sales in Reliance Retail also propped up RIL, and in turn the Nifty50 index. READ MORE
SECTOR WATCH:: Nifty Metal index dips 1%
UTI AMC makes a tepid debut, lists at 11.5% discount to issue price
Shares of UTI Asset Management Company (UTI AMC) made a tepid debut at the bourses on Monday. The stock of the company listed at Rs 490.25 on the BSE, an 11.5 per cent discount to the issue price of Rs 554. On the National Stock Exchange (NSE), the stock's opening price stood at Rs 500, down 9.75 per cent against the issue price. READ MORE
Mazagon Dock Shipbuilders lists at 49% premium over issue price
Shares of Mazagon Dock Shipbuilders listed at Rs 216.25, a 49 per cent premium against the issue price of Rs 145 per share on the BSE on Monday. Till 10:26 AM, the stock had hit a high and low of Rs 216.65 and Rs 176.50, respectively. As many as 2.11 crore equity shares have changed hands on the counter on the BSE and NSE combined, so far. READ MORE
Edelweiss on Tata Steel
We continue to prefer Tata Steel in the ferrous space as its domestic operations are on a sound footing while the performance of European operations (TSE) is set to improve. Besides, debt seems to have peaked out given ensuing capex intensity is low. We also believe the balance sheet restructuring at TSE would demand much less of parent support. Retain ‘BUY’ with an unchanged TP of INR500 (exit 6.4x FY22E EBITDA).
ICICI Securities on OMCs
IOC and HPCL’s share prices have declined by 8-12% in the last one month and are now trading at 0.7-0.79x FY21E P/BV. OMCs corrected despite sharp recovery n auto fuel consumption (petrol up 3% YoY & diesel down 6% YoY in Sep), auto fuel net margins appearing to be on track to be over Rs3/l in FY21E and Singapore GRM and petrol cracks rising to 8-month high.
Diesel cracks remain a concern though they are up from Sep’20 lows. However, HPCL and IOC’s share prices are factoring in low GRMs. We have raised OMCs’ FY21E marketing margin estimates by 32%, but cut GRM estimates by 38-71%. Our revised target price implies 14-42% upside for IOC and HPCL. We reiterate BUY on HPCL and ADD on IOC.
ICICI Securities on power sector
Power demand recovered significantly in Q2FY21 resulting in improved thermal PLFs and subsequently higher offtake from Coal India (CIL). H1FY21 generation was lower, only 8.7% YoY (vs -16.4% in Q1FY21) and thermal PLFs improved 300bps from Q1FY21 to 49.6%. Peak demand reached 176.6GW on 18th Sep’20 (lower only 3.9% from FY20 levels of 183.8GW). This resulted in higher coal offtake with CIL registering 9.6% YoY growth in Q2FY21.
Opening up of the economy helped improve collections for discoms and further disbursal through PFC/REC scheme is expected to ease the receivables situation in coming months. This, combined with two other eagerly awaited developments – passing of Electricity Amendment Act and National Tariff Policy – are expected to result in sector re-rating. NTPC and Coal India are our top picks in the sector.
Rupee opens slightly higher at 73.11/$ vs Friday's close of 73.13 against the US dollar
NEW LISTING:: UTI AMC lists at 11% discount
Mazagon Dock Shipbuilders lists at 49% premium over listing price of Rs 145
Shilpa Medicare slips 12% on USFDA warning letter for Telangana facility
Shares of Shilpa Medicare tumbled 12 per cent to Rs 480 on the BSE on Monday after the US health regulator issued a warning letter to the company’s Jadcherla formulations facility in Telangana. “The company has received a warning letter on 9th October 2020 through email from the United States Food and Drug Administration (USFDA) for its Jadcherla facility, Telangana,” Shilpa Medicare said in exchange filing on Saturday, October 10, 2020. READ MORE
Vedanta tanks 10% as delisting offer fails; Co to mull future action today
Shares of Vedanta tanked 10 per cent to Rs 109.90 on the BSE in the early morning trade on Monday, after the company announced the failure of delisting offer as the promoters failed to garner the required number of shares. The stock trades in the futures & option (F&O) segment, which has no circuit limits. Till 09:23 am, a combined 2.4 million equity shares had changed hands on the NSE and BSE. There were pending sell orders for around 28 million shares on both the exchanges. READ MORE
MARKET UPDATE:: Nifty PSU Bank index up 2%
MARKET CHECK :: Indices off day's high
RITES edges 1% higher
>> The company on Friday (9 October) announced that it has secured consultancy orders worth Rs 103 crore from various clients.
Federal Bank gains 2%
Shilpa Medicare slumps over 6%
>> Shilpa Medicare announced that its Jadcherla facility in Telangana received a warning letter on 9 October 2020 from the US drug regulator. The company said that it will be engaging with the agency and is fully committed in resolving this issue at the earliest.
Glenmark Pharma trades in the red
>> Drug firm Glenmark Pharmaceuticals on Friday said the addition of antiviral Umifenovir did not demonstrate any significant clinical benefit over Favipiravir alone in moderate Covid-19 patients. The clinical study evaluated the possible superiority of the combination's efficacy against Favipiravir monotherapy, Glenmark said in a statement.
Wipro trades flat ahead of Q2 nos
State Bank of India trades as top gainer
Vedanta cracks 10% as delisting fails
Sectoral trends at Open
Sensex Heatmap at Open
Opening Bell :: Nifty reclaims 12,000
Statsguru: Bulls on Dalal Street once again back in the driver's seat
After some turbulence in September, the Bulls on the Dalal Street are once again back in the driver’s seat. The benchmark S&P BSE Sensex rallied nearly 10 per cent in the past 10 trading sessions and regained the psychological 40,000-mark after over seven months. READ MORE
Top gainers and losers on the S&P BSE Sensex at Pre-open
Markets at Pre-open
Markets at Pre-open
Two new scrips -- state-owned defence major Mazagon Dock Shipbuilders and UTI Asset Management Company -- are set to debut at the bourses on today. The former has fixed an issue price of Rs 145 per share, while the latter has fixed Rs 554 per share.
India to press for complete disengagement at today's Corps Commander talks
India will press for early and complete disengagement of troops by China from all the friction points in eastern Ladakh at the seventh round of high-level military talks between the two countries on Monday, government sources said.
The talks are slated to begin at 12 noon in Chushul on the Indian side of the Line of Actual Control (LAC) in eastern Ladakh, they said. READ MORE
Stocks to watch out for
Vedanta: Anil Agarwal-led Vedanta Resources on Saturday said it had failed to receive the required number of shares to delist Vedanta Limited. Accordingly, equity shares of Vedanta Limited and those tendered by shareholders in the delisting offer would continue to remain listed on the exchanges, said the company.
Wipro: The Bengaluru-headquartered information technology (IT) services firm is slated to announce its September quarter results for the fiscal year 2020-21 (Q2FY21) on Monday, October 12.
Glenmark: Drug firm Glenmark Pharmaceuticals on Friday said the addition of antiviral Umifenovir did not demonstrate any significant clinical benefit over Favipiravir alone in moderate Covid-19 patients. READ MORE
Result Today :: Wipro CEO's strategy to revive growth, Q3 growth guidance eyed
The brokerage expects Wipro to report 1.6 per cent quarter-on-quarter (QoQ) growth in revenues in constant currency terms with 160 basis points (bps) cross-currency tailwinds and stable margins. Growth will be driven by the removal of supply-side constraints and deal ramp-ups. The focus will be on Mr. Delaporte's strategy to revive growth and growth guidance. READ MORE
Nifty outlook and stock picks by Gaurav Garg of CapitalVia Global Research
As per weekly option data, handful of put writing on lower strikes ranging from 11,700 to 11,900 is witnessed which shows Nifty would face firm support in sub 11,800 zone. The level of 11,000 will act as support as maximum put OI is placed here. We can witness short covering move along with addition of fresh position if Nifty breaches 12,000. Therefore, traders should try to create long position keeping close eye on 11,700. READ MORE
Paul Hickin :: US election outcome, Libyan crude return can change oil market dynamics
US crude producers have been hit hard by prices slumping around $40/barrel. Output of crude and condensate from the light sweet crude producer may not start to recover until the second half of 2021, as the substantial drop in fracking crews and rig counts since March takes its toll. S&P Global Platts Analytics predicts US output averaging just 10.24 million b/d in 2021, compared with 11.38 million b/d this year. The forecast is well below the runaway 13 million b/d pre-Covid-19 peak. READ MORE
Festive demand will keep buyers active, while limited availability will support prices. The price in the Delhi market is expected to move to Rs 5,700-Rs 5,725 per quintal, from the current price of Rs 5,650 per quintal, in the week ahead READ MORE
'Steady move towards 12,200 likely once Nifty conquers 12k'
Since, the banking index is back to 200-day SMA on the daily chart and the way it closed with complete gush in the space, a move beyond 24,000 would provide strong support to the benchmark index. However, we would like to highlight that since the move is extremely swift, anytime we can see some intraday profit booking and hence, one needs to position accordingly and be very fussy in stock selection. READ MORE
Two PSU stocks that Vaishali Parekh of Prabhudas Lilladher is bullish on
BUY STATE BANK | CMP: Rs 198 | Target: Rs 230-240 | Stop Loss: Rs 180
The stock has taken support near 180-levels which has formed a good base and has picked up momentum to improve the bias. The RSI indicator has also indicated a trend reversal from the oversold zone and is going strong. With the chart looking attractive, we suggest to buy and accumulate this stock for an upside target of Rs 230-240 levels, keeping the stop loss of Rs 180. READ MORE
FII/FPI & DII trading activity on NSE, BSE and MSEI
Oil prices extend losses
>> Oil prices dropped for a second straight session on Monday as US producers began restoring output after Hurricane Delta weakened, while a strike that had affected production in Norway came to an end.
>> Brent crude for December fell 55 cents, or 1.3%, to $42.30 a barrel and US West Texas Intermediate for November was at $40.08 a barrel, down 52 cents, or 1.3%.
SGX Nifty update
>> At 8:20 am, the index was at 11,996 level, up 36 points or 0.30 level.