Nifty nears 12,000 mark; FMCG shares slide

Key indices were trading near the day's high in morning trade. The Nifty was currently trading near the 12,000 mark. FMCG shares extended decline for second day.

At 10:22 IST, the barometer index, the S&P BSE Sensex, was up 377.09 points or 0.93% at 40,921.46. The Nifty 50 index added 101.50 points or 0.85% at 11,998.30.

In the broader market, the S&P BSE Mid-Cap index gained 0.81% while the S&P BSE Small-Cap index rose 0.69%. Both these indices underperformed the Sensex.

The market breadth was strong. On the BSE, 1422 shares rose and 656 shares fell. A total of 128 shares were unchanged.

Coronavirus Update:

India reported 740,090 active cases of COVID-19 infection and 115,914 deaths while 6,795,103 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India. Total COVID-19 confirmed cases worldwide stood at 40,728,371 with 1,123,967 deaths, according to data from Johns Hopkins University.

Buzzing Index:

The Nifty FMCG index declined 0.27% to 29,884.85. The index has slipped 0.61% in two sessions.

Britannia Industries (down 2.06%), Nestle India (down 0.72%), Hindustan Unilever (down 0.59%), Jubilant Foodworks (down 0.42%) and Marico (down 0.38%) declined.

Meanwhile, United Breweries (up 1.35%), Godrej Consumer (up 0.74%), United Spirits (up 0.72%), Emami (up 0.33%), ITC (up 0.26%) and Tata Consumer Products (up 0.20%) advanced.

Earnings Today:

UltraTech Cement (up 0.04%), Bajaj Finance (up 0.44%), Bajaj Finserv (up 0.73%), Syngene (up 0.69%), Colgate Palmolive (down 0.04%), GMM Pfaudler (up 0.39%), Chennai Petroleum (up 4.42%), DB Corp (up 1.12%), JK Tyres & Industries (up 1.36%), KPIT Technologies (up 0.40%), Tejas Networks (up 8.14%) and VST Industries (down 0.20%) will announce their quarterly earnings today.

Earnings in Focus:

Hindustan Zinc rose 2.98% to Rs 229.60. The company's net profit declined 6.8% to Rs 1940 crore on 24% rise in net sales to Rs 5533 crore in Q2 September 2020 over Q2 September 2019.

The company said that the increase in revenue was led by higher metal volumes, higher silver prices aided by rupee depreciation partly offset by lower zinc & lead LME prices. Net profit declined year-on-year due to higher depreciation & amortization, finance cost and higher tax rate due to change in income mix.

In its outlook, the company said: "We previously guided to achieve mined metal and finished metal production of 925-950 KT each and saleable silver production of c.650 MT in FY21. We also guided zinc cost of production to remain below $1,000 per MT and project capex between $100 million and $140 million for the year. We remain on track to achieve the above guided numbers for FY21."

The company's board approved an interim dividend of Rs 21.30 per share for the financial year 2020-21 amounting to Rs 9,000 crore.

Indian Energy Exchange (IEX) fell 2.79% to Rs 193.45 after the company posted a 9.2% fall in consolidated net profit to Rs 44.33 crore in Q2 September 2020 from Rs 48.82 crore in Q2 September 2019. Consolidated revenue from operations stood at Rs 70.92 crore in Q2 September 2020, registering a 5.1% rise from Rs 67.45 crore posted in the same period last year.

The electricity volumes on the Exchange witnessed an increase of 13.2% YoY in Q2 September 2020 and stood at 16,486 MU as compared to 14,560 MU in Q2 September 2019.

IEX said the second quarter of fiscal year 2021 saw a sharp recovery in industrial activity and electricity consumption owing to easing of the lockdown restrictions across the country. The start of the second quarter saw a slump in manufacturing due to re-lockdowns in a few states, however, the industrial activity picked up momentum in the months of August and September 2020.

With increase in economic and industrial activity, the power demand also accelerated and returned to the pre-COVID levels. The country witnessed 2% YoY increase in national peak demand and 4.6% YoY increase in energy consumption in September 2020.

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