F&O expiry: Sensex soars 997 pts on Covid-19 drug hopes; auto, IT stks gain

NSE's headline index Nifty surged 307 points or over 3 per cent to settle at 9,860.
Indian equity market soared on Thursday, the last day of the futures & options (F&O) contracts of April series, as encouraging early results from a Covid-19 treatment trial boosted investor sentiment. Buying was witnessed across the board with stocks such as Tata Motors, Vedanta, and Hindalco leading the charge. 

The S&P BSE Sensex rallied an impressive 997 points or 3 per cent to 33,718 levels. Of 30 constituents, 26 ended in the green and rest 4 in the red. ONGC (up over 13 per cent) emerged as the biggest gainer on the index, followed by HCL Tech (up 11 per cent), Hero MotoCorp (up 9 per cent), and NTPC (up 6 per cent). 

On the contrary, Sun Pharma (down nearly 3 per cent) ended as the top loser. HUL ,too, ended over 1.6 per cent lower at Rs 2,195.70 ahead of its March quarter results due later in the day. 

Reliance Industries (RIL) stock ended nearly 3 per cent higher at Rs 1,467.05 apiece on the BSE. The company is slated to announce March quarter results and consider rights issue later in the day. Further, it has announced that it will reduce the salaries of some of its employees in the hydrocarbon division by 10 per cent in view of the "adverse impact" of the coronavirus pandemic on fuel demand. READ MORE

NSE's headline index Nifty surged 307 points or over 3 per cent to settle at 9,860. 

On a weekly basis, Sensex zoomed 7.6 per cent and Nifty jumped 7.7 per cent. 

In the broader market, the S&P BSE MidCap index rallied 1.46 per cent to 12,013 levels and the S&P BSE SmallCap index gained over 1 per cent to 11,102-mark. 

On the sectoral front, metal stocks advanced the most with the Nifty Metal index surging 8 per cent to 1,859.90 levels. Nifty Auto index was second on the list - up 6.45 per cent to 5,901 levels. 

Markets will remain closed on Friday on account of Maharashtra Day. 

Global Markets

World stocks headed for their best month on record on Thursday, as encouraging early results from a COVID-19 treatment trial and expectations of more European Central Bank (ECB) stimulus later in the day helped ease the pain of February and March.

Europe saw a cautious start.

A 1.4 per cent rise in MSCI’s broadest index of Asia-Pacific shares, excluding Japan, has it tracking toward a weekly gain of more than 5 per cent, its best in three weeks. Japan's Nikkei jumped 2.8 per cent to a seven-week high. 

In commodities, oil prices jumped, lifted by signs that the US crude glut is not growing as quickly as expected and of a rise in fuel demand, which has been crushed by the coronavirus. West Texas Intermediate (WTI) crude futures climbed to $17.11 a barrel, up 13.6 per cent or $2.05 at the time of writing of this report. The US benchmark surged 22 per cent on Wednesday.

Brent LCOc1 was up 7.6 per cent, or $1.71 at $24.25 a barrel in light trading, with the June contract expiring on Thursday, having posted a 10 per cent gain on Wednesday.

(With inputs from Reuters)


LIVE UPDATES

MARKET COMMENT | Vinod Nair, Head of Research at Geojit Financial Services

"Market ended positive for the fourth day in a row, on the back of positive signals from global markets. Successful trials of a Covid-19 vaccine helped the global markets gain some positivity. Domestically, indications of easing of lockdown measures and stimulus hopes helped drive the markets. Being F&O expiry day today, short covering and roll-overs in the market also contributed to the gains. Financials and IT contributed most to the gains in the benchmark indices alongwith Reliance, ahead of its results. Next week outlook will be driven by the way forward for resumption of business after lockdown, announcement of any stimulus package and stock specific earnings results."

Sectoral gainers and losers on the NSE


MARKET AT CLOSE | Top gainers and losers on the S&P BSE Sensex


RIL announces salary cuts; Mukesh Ambani to forgo entire compensation

Reliance Industries Ltd has announced that it will reduce the salaries of some of its employees in the hydrocarbon division by 10 per cent in view of the "adverse impact" of the coronavirus pandemic on fuel demand. The company’s board of directors would forgo 30 per cent to 50 per cent of their salary, and Chairman Mukesh Ambani, India’s richest man, his entire compensation, according to a letter signed by Reliance Industries Executive Director Hital R Meswani. READ MORE 


CLOSING BELL

The S&P BSE Sensex rallied 997 points or over 3 per cent to 33,717.62 while NSE's Nifty50 ended at 9860, up 306.5 points or 3.21 per cent.

BUZZING STOCK | HCL Tech soars over 11%


MARKET CHECK | Top 5 losers on the BSE at this hour


Majority of the sectoral indices in the green; Nifty Metal index gains 8%


MARKET ALERT :: ONGC, HCL Technologies locked in 10% upper circuit

>> However, the stocks are trading in future & option (F&O) segment which has no circuit limits.

Top gainers on BSE today

COMPANY PRICE(rs) CHG(%)
TATA MOTORS 91.45 17.02
UPL 411.70 14.28
MAH. SEAMLESS 221.45 12.64
TATA MOTORS-DVR 39.20 12.32
APL APOLLO 1413.00 11.76
» More on Top Gainers

Entire sector may turn NPA, will need ventilator support: Retail body CEO

"If the banking sector and the government does not come and help now, the retail sector will become an NPA, then they will have to handle a very different problem, which would be a much larger problem. NPAs could be as much as Rs 75,000 crore from retail," he said. READ MORE

UPL shares gain 11% on biz update, expectation of net debt reduction

The agrochemicals company said its net debt stood at approx. $2.9 billion as of March 31, 2020 as compared to $4.2 billion as on December 31, 2019. Net debt stood at $3.8 billion as of March 31, 2019, it said.
 
The same represents a reduction in net debt of approx. $900 million and $1.3 billion as compared to Q4FY19 and Q3FY20, respectively. The company has cash/cash equivalent of approximately $875 million (approx Rs 6,500 crore) as of March 31, 2020. READ MORE

India's jewellery demand dips 41% to 11-year low in March quarter: WGC

As regards India, although the wedding season lifted demand early in the March 2020 quarter, a sharp rise in local gold prices from mid-February led to a slowdown in demand as consumers held back on purchases. However, the overall demand slumped once the country went into a lockdown mode on the rampant spread of coronavirus. Jewellery demand in March, according to WGC estimates, slumped between 60 - 80 per cent. READ MORE 


Hindustan Unilever trades lower for third straight day ahead of Q4 results

Shares of Hindustan Unilever (HUL) were trading lower for the third straight day, down 3.2 per cent to Rs 2,160 on the BSE on Thursday ahead of the announcement of its financial results for the quarter and year ended March 2020 (Q4FY20) later in the day. In the past three trading days, the fast moving consumer goods (FMCG) firm's stock has slipped 7 per cent, as compared to 6 per cent rise in the S&P BSE Sensex. READ MORE

BROKERAGE VIEW:: Axis Securities on HDFC Bank

As macro concerns loom large on Covid-19 headwind, we expect loan growth at ~14/18% in FY21/FY22E with retail book slowdown, slower fee income growth, higher provisioning but partly offset by cost rationalization (C-I improvement of 160bps). Prov/Avg. Advances will go up to 1.5% in FY21 but normalize to 1.2% in FY22E. We expect HDFCB to report lower ROAA/ROAE at 1.8%/16% in FY21, but normalize to 1.9%/17% by FY22E. Given its superior business model, bank’s resilience across cycles will play out positively. We initiate with BUY with target price of Rs 1,233 derived using the SOTP method (core bank at 3xFY22 ABV + Subsidiaries value Rs 50/-).

Rupee closing

Rupee ends higher at 75.12/$ vs Wednesday's close of 75.68 against the US dollar

India's scrap gold supplies at record high on price rally, coronavirus: WGC

Rising scrap supplies, amid a fall in demand could, however, dent the world's second-biggest bullion consumer's imports and cap a rally in global prices, which hit a more than seven-year high earlier this month. Falling bullion imports could help reduce India's trade deficit and support the ailing rupee. READ MORE

BUZZING STOCK | UPL jumps around 7% post update on debt position

>> The Company expects its Net Debt to be at approx. USD 2.9 Bn as of 31st March 2020 as compared to USD 3.8 Bn as of 31st March 2019 and USD 4.2 Bn as of 31st December 2019. The same represents a reduction in Net Debt of approx. USD 900 Mn and USD 1.3 Bn as compared to 31st March 2019 and 31st December 2019, respectively. (Source: BSE filing)

NEWS ALERT :: RBI extends truncated forex market hours till further notice


Bulk maturities for 3 Franklin Templeton MF schemes after 2 years

nvestors in the six wound-up schemes of Franklin Templeton Mutual Fund (MF) can face wide differences in timelines on receiving payments through maturities of portfolio investments, with the bulk of maturities for three schemes expected in two years’ time. READ MORE

BROKERAGE VIEW:: HDFC Securities on Sadbhav Engineering

Sadbhav Engineering Ltd (SEL) has announced a management rejig with Mr Vasistha Patel (VP) being appointed as CEO and Mr Shashin Patel stepping down as Chairman and MD to Vice Chairman in non executive capacity. We perceive this as a positive step with VP getting iron hand on execution and promoter SP dissociating himself from day to day run. SEL BS has deleveraged post the SIPL deal and now VP has immediate challenge of ramping up execution against the COVID-19 headwinds. We maintain BUY with SOTP of Rs 56/sh.

MF redemptions in dent segment continue despite RBI's liquidity window

According to the data, the asset base of credit risk funds on Tuesday shrunk another 11 per cent, following erosion of Rs 4,869 crore.
 
Other debt categories are also witnessing redemption pressure. The asset base of medium-duration fund declined 6 per cent or Rs 1,479 crore on Tuesday. For the low-duration category, the asset base was down 3.13 per cent or Rs 2,475 crore. READ MORE

MARKET CHECK | Top 5 gainers on the BSE at this hour


NEWS ALERT | SpiceJet has decided not to cut job at the airline at this time

>> SpiceJet with its limited cargo operations during the lockdown period, will pay part salaries to over 92% of its employees.

>> The Company has devised a structure where all employees will be paid according to the work hours contributed while maintaining basic thresholds.

(Via company statement)


HDFC Bank, Bharat Forge: How to trade auto, bank stocks in current market

NIFTY AUTO : With a strong formation of a 'Double Bottom' on the daily chart, the index has managed to strongly bounce back. Going ahead, the index can even gain ground around 5,200 levels, thus establishing a strong buying base. Further, as it crosses 5,700 levels, which is its immediate resistance, a decent rally may further push the index towards 6,100 and then 6,300 levels. READ MORE

BROKERAGE VIEW:: Edelweiss Securities on Hexaware Technologies

We believe Hexaware has made a smart acquisition in Mobiquity, which gives the company potent capabilities to enter the digital transformation market. However, dependence on BFSI and current COVID-19 situation imply significant challenges in the near term. At 14x CY20E EPS, the stock is fairly priced, in our view in current uncertainty. We maintain ‘HOLD/SP’ with revised target price of Rs 285 (14x Q2CY21E EPS). 

NEWS ALERT :: Reserve Bank extends regulatory benefits under SLF-MF scheme to all banks


Reliance Industries gains 3% ahead of Q4 results


MARKET UPDATE:: Broader indices underperform


Just Dial soars 9% as board approves buyback at Rs 700/ sh via tender offer

Shares of Just Dial moved 9 per cent higher in the intra-day trade to Rs 425, on the BSE on Thursday after its board approved buyback of shares at Rs 700 per share via tender offer. “The board today approved the proposal for buyback of up to 3.14 million equity shares, representing 4.84 per cent of the total paid-up equity share capital of the company, at a maximum price of Rs 700 per share, for an aggregate maximum amount of up to Rs 220 crore through the tender offer route,” Just Dial said in an exchange filing. READ MORE

MARKET CHECK | HUL slips over 2.5% ahead of March quarter results


BROKERAGE VIEW:: Emkay Global Fin Services on Auto Ancillaries

  • Amid the overall weakness in Autos in FY21, marginal growth is expected in the Lead Acid Battery (LAB) segment, driven by an upsurge in aftermarket demand (14%/6% growth in 2W/other vehicular volumes likely in FY21E) stemming from the replacement of old and discharged batteries post the removal of lockdowns.
  • Lead, which is the key input commodity, constitutes ~70% of RM costs, and global lead prices have corrected by ~15% in the past three months. Despite the increase in competition and notable pass-through to customers, we expect an improvement of up to 50bps in FY21E gross margin for EXID and AMRJ.
  • EXID is working toward a shift to a two-tier distribution model, as it will provide better reach and reduce costs. During the transition period, there could be a shift of some of EXID’s retailers from exclusive to multi-brand outlets, resulting in some market share losses.
  • We expect revenue/EBITDA growth at 8%/10% for AMRJ and 6%/8% for EXID over FY20- 22E. Driven by expectations of a quick recovery, low fixed costs, margin support from benign lead prices and healthy liquidity position, we maintain Buy on AMRJ (TP: Rs624) and EXID (TP: Rs189).

Polycab India shares hit 5% upper circuit ahead of board meet tomorrow

Shares of Polycab India were locked in 5 per cent upper circuit at Rs 725 on the BSE on Thursday ahead of tomorrow's board meeting to consider and approve the proposal for investment / acquisition of shares. Till 11:36 am, a combined 134,000 equity shares had changed hands on the counter and there were pending buy orders for around 40,000 shares on the BSE and NSE so far. READ MORE

BUZZING STOCK | Vedanta surges 7.5%


NEWS ALERT | SC refuses to interfere with RBI's moratorium circular: CNBC TV18

-- RBI may examine the implementation of the mortaorium circular: SC
 
- Proper guidelines for the enforcement of the circular should be in place: SC

MSCI India rebalancing to stoke FPI inflows to the tune of Rs 1,900 cr

Domestic equities are expected to see inflows to the tune of $250 million (Rs 1,900 crore) on account of the semi-annual rebalancing of the MSCI India Index, which is tracked by funds worth $14 billion (Rs 1 trillon), according to domestic brokerage Emkay Global. The rebalancing is scheduled to take place on May 12, and the changes will become effective from June 1. READ MORE  

Why all eyes will be on the expiry of Brent oil futures this week

The expiry of the June contract for Brent oil futures in Europe on Thursday will possibly be the most watched event in oil markets for some time after the US benchmark plummeted below zero for the first time in history last week. The coronavirus pandemic has killed oil demand as over four billion people are in lockdown and last week, ahead of its contract expiry, US West Texas Intermediate (WTI) futures crashed deep into negative territory making it a liability for anyone holding it. READ MORE

From overweight to underweight, how sentiments have changed for banks

Last week’s move by Christopher Woods, global head, equity strategy, Jefferies, to remove HDFC Bank and ICICI Bank from the brokerage’s Asia ex-Japan thematic equity portfolio, after retaining them for almost a decade, came as a shock. Ridham Desai, managing director, Morgan Stanley, turning neutral on banking stocks on Tuesday was another big blow. READ MORE

BROKERAGE VIEW:: Emkay Global Fin Services on Hexaware Technologies

Despite the slight beat in net profit supported by forex gains, we leave our operating estimates and earnings estimates unchanged. We also introduce CY22E EPS at Rs25.6. We retain Hold, with a revised TP of Rs280 (vs. Rs 260 earlier) as we roll over to Mar’22 (vs. Dec’21 earlier), based on an unchanged target P/E multiple of 11x. The recent run-up in the stock price suggests absolute downsides driving us to reduce our slight OW in the name to EW.

Tech Mahindra Q4 preview: What analysts expect; key things to watch out for

So far, IT companies have reported mixed sets of numbers for the quarter ended March 2020. Mindtree posted strong numbers — and its highest-ever deal wins, at $393 million — and its management's commentary on deal pipeline and room for margin expansion was more optimistic than those of its bigger peers. READ MORE

MARKET ALERT :: These 10 stocks have seen their market price gain over 100% in the month of April

>> These include Mcleod Russel, Jain Irrigation, Opto Circuits, Sanwaria Consumer, Sintex Plastics, Kellton Tech, Reliance Infrastructure, Sakuma Exports, Bajaj Hindusthan and Eros International Media

BROKERAGE VIEW:: HDFC Securities on Max Financial Services

JV with Axis Bank provides long-term distribution capability to the business and ends uncertainty and market anxiety on the future of the current partnership. We expect dependence and hence investments in proprietary channels to reduce, thereby increasing VNB. We rate MAXF a BUY with an increased TP of Rs 560 (Mar-21E EV + 25.0x FY22E VNB).

BROKERAGE VIEW:: Edelweiss Securities on Home decor players

Demand slowdown is likely to be a near-term challenge and has held back our thesis (demand shift from unorganised to organised) from playing out. Operational uncertainty notwithstanding, we believe players with strong balance sheets would be able to navigate this turbulence. Maintain ‘BUY’ on Century Plyboards  (attractive valuation) and ‘HOLD’ on Greenlam Industries.

BROKERAGE VIEW:: Motilal Oswal Financial Services on Hexaware Technologies

Hexaware Technologies : Underwhelming outlook!
 
May witness continued challenges in some key accounts
  • The company’s commentary and outlook on: (1) demand in key segments, (2) supply issues, (3) margins, and (4) recovery timelines were underwhelming. While management indicated headwinds at a top account (Freddie Mac) were largely in the past, we believe exposure to Freddie Mac / Fannie Mae is a key risk to watch out for given the news surrounding their financial health. A relatively weaker outlook, a heavier balance sheet, and the overhang around a stake sale by Barings in this uncertain environment may limit investor interest in the stock in the near term.
  • We downgrade our EPS estimates over FY21–22E by 13–15%. The benefit due to currency rebasing (2.9–4.4%) was more than offset by the downgrade in both growth and margin levels. Maintain Neutral.

Auto stocks in focus; Nifty Auto index up 5%, Tata Motors surges 15%

Among individual stocks, Tata Motors surged 14.77 per cent to Rs 89.70 in the biggest one-day gain for the stock in six months after reports said that Jaguar Land Rover had restored three-fourth of its budgeted production in China. According to a report in Mint, with lockdown measures easing in China all of its retailers are now open and sales are recovering. READ MORE

Markets at inflection point; analysts bullish on consumer, telecom, pharma

“The road ahead for the markets will depend on fiscal response by the government, progression of Covid-19 – which so far appears to be encouraging, and the age of the current bear phase,” wrote Ridham Desai, head of India research and India equity strategist at Morgan Stanley in a note with Sheela Rathi. READ MORE

RIL to consider rights issue, announce Q4 nos on April 30. What to expect?

According to analysts, the company's decision to consider rights issue is unexpected; however, considering that the equity markets may not do well in the near-term due to Covid-19 crisis, the company may have resorted to the rights issue to raise money. READ MORE

Pharma index set to post its biggest monthly gain in 21 years amid Covid-19

The S&P BSE Healthcare index has rallied nearly 26.9 per cent thus far in April 2020, on a strong rally in stock such as Sun Pharmaceuticals Industries, Cipla, Lupin, Aurobindo Pharma and Glenmark Pharmaceuticals. In comparison, the benchmark S&P BSE Sensex has gained 11 per cent during this period. On the other hand, the Nifty Pharma index, which surged 30.8 per cent thus far in April, is set to post its record the biggest monthly rally since January 2001. The last time the S&P BSE Healthcare index saw a similar rally was in March 1999 when it had surged 31.5 per cent in a month. READ MORE

HUL to announce Q4FY20 results today; here's what brokerages expect

Hindustan Unilever (HUL) is slated to announce its results for the fourth quarter ended March 2020 (Q4FY20) on April 30. According to analysts, most consumer goods companies would have taken a hit during the quarter under review due to Covid-19 lockdown, which has caused enormous logistical issues. Companies with higher exposure to food and daily essentials, analysts say, are expected to fare better this quarter as compared to those with a skew towards discretionary consumption. READ MORE

Nifty Auto index up 5%, top sectoral gainer


How to use morning and evening stars to make money in stock market

Morning Star and Evening Star are two candlestick patterns that symbolize major trend reversal ahead that can shift the market sentiment. The Morning Star is considered as a positive indicator, whereas Evening Star denotes a negative turnaround. READ MORE

Glenmark zooms 9% on DCGI nod to conduct clinical trials for Covid-19 drug

The product is a generic version of Avigan of Fujifilm Toyama Chemical, Japan, a subsidiary of Fujifilm Corporation. As on date, Glenmark is the first pharmaceutical company in India to be given an approval by the regulator to start the trial on COVID-19 patients in India, the company said in a press release. READ MORE

STOCK ALERT :: Polycab India hits 5% upper circuit


MARKET ALERT :: NIfty tops 9,800-mark


MARKET ALERT :: Sensex extends gains; now up 880 pts


Motherson Sumi adds nearly 9%


Tata Motors jumps 10%


Glenmark Pharma jumps over 6% on approval to conduct Favipiravir Antiviral tablets trials


Ahead of Q4 nos | Tech Mahindra advances over 3%


Kajaria Ceramics vaults 14%


RIL gains over 1% ahead of Q4 nos


HUL turns positive ahead of results


Sectoral trends on NSE at open


Sensex Heatmap | 28 of 30 constituents open in the green


Opening Bell | Nifty50 tops 9,700-mark


Opening Bell | Sensex rises 2%


NEWS ALERT | Lupin receives EIR for Pithampur unit by US FDA: BSE filing


Top gainers and losers on S&P BSE Sensex at Pre-open


Market at Pre-open


Market at Pre-open


Federal Reserve leaves rates near zero, sees coronavirus risks lingering

"The Federal Reserve is committed to using its full range of tools to support the US economy in this challenging time, thereby promoting its maximum employment and price stability goals," the central bank said in a statement at the end of a two-day policy meeting held via videoconference. READ MORE

Stocks to watch: RIL, HUL, Wipro, Tech Mahindra, AU Small Finance Bank, SIS

RIL: The oil-to-telecom behemoth is slated to consider rights issue as well as announce March quarter results later in the day. 
 
HUL: The FMCG giant is scheduled to release its results for the fourth quarter ended March 2020 (Q4FY20) today. Edelweiss Securities expects revenue to dip 5.8 per cent YoY to Rs 9,369.5 crore, while EBITDA (earnings before interest, taxes, depreciation, and amortisation) and PAT (net profit) is likely to grow 1.7 per cent and 4.7 per cent YoY, respectively at 2,361.1 crore and 1,683.8 crore. READ MORE
 

F&O Expiry :: Rollover Analysis

>> The Nifty Apr expiry rollover is at 56.78% on Wednesday compared to 49.6% on same day of previous expiry.

>> The Banknifty Apr expiry rollover is at 64.35% on Wednesday compared to 39.99% on same day of previous expiry.

>> The Market wide Apr expiry rollover is at 74.19% on Wednesday as compared to 72.44% on same day of previous expiry

(Source: Nirmal Bang Securities)
 

NEWS ALERT | Glenmark Pharma receives approval to conduct trials on Favipiravir Antiviral tablets for Covid-19: BSE filing

>> The company announced it has received approval from the DCGI (Drug Controller General of India), the regulator in India to conduct clinical trials on Favipiravir Antiviral tablets on Covid-19 patients.

>> The product is a generic version of Avigan of Fujifilm Toyama Chemical Co. Ltd., Japan, a subsidiary of Fujifilm Corporation.

Alert: Favipiravir has demonstrated activity against influenza viruses and has been approved in Japan for the treatment of novel influenza virus infections. Recently in the past few months, post the outbreak of COVID-19, multiple clinical trials have been initiated on COVID-19 patients in China, Japan and in the US.

Bulk deals on NSE as on Wednesday

Bulk deals on BSE as on Wednesday


FII/FPI & DII trading activity on NSE, BSE and MSEI


NEWS ALERT :: China’s Services PMI expands to 53.2 from 52.3 in March, reports Reuters

>> China’s Manufacturing PMI eased to 50.8 in April from 52 in March.

>> The official April composite PMI, which includes both manufacturing and services activity, rose to 53.4 from March’s 53.

Rupee check

Source: Bloomberg


Oil check

>> At 8:22 am, Brent crude futures were trading nearly 8 per cent higher at $24.3/bbl.

>> US WTI, meanwhile, was at $16.6 per barrel-mark, up over 10 per cent.

SGX Nifty indicates positive start for indices

>> At 8:17 am, the index was at 9,754.25 level, up 205.10 points or 2.15 per cent

Asian stocks track gains in the US

Source: Reuters


Wall Street rallies on promising coronavirus drug

Source: Reuters


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