Shares pare gains; European shares advance

The market pared gains in afternoon trade as profit selling emerged at higher levels. At 13:23 IST, the barometer index, the S&P BSE Sensex, was up 879.29 points or 2.69% at 33,599.45. The Nifty 50 index was up 248.30 points or 2.60% at 9,801.65. Trading was volatile ahead of the monthly F&O expiry today.

Global shares jumped following developments overnight regarding the use of Gilead Sciences' antiviral drug Remdesivir as a potential new treatment for Covid-19 patients. Sentiment also improved after China said manufacturing activity in the country expanded slightly in April.

Buying was also triggered after foreign portfolio investors (FPIs) turned net buyers of Indian equities on Wednesday (29 April). FPIs bought shares worth a net Rs 722.08 crore on 29 April 2020, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 78.67 crore on 29 April 2020, as per provisional data.

In the broader market, the S&P BSE Mid-Cap index rose 1.26% while the S&P BSE Small-Cap index added 1.35%. Both these indices trailed the Sensex.

The market breadth was strong. On the BSE, 1353 shares rose and 929 shares fell. A total of 162 shares were unchanged. In Nifty 50 index, 44 stocks advanced while 6 stocks declined.

Stocks in Spotlight:

Reliance Industries (up 3.56%), Hindustan Unilever (down 2.63%) and Tech Mahindra (up 1.39%) will announce their fourth quarterly earnings today.

Hindalco Industries (up 7.57%), Hero MotoCorp (up 7.38%), HCL Technologies (up 6.44%), Vedanta (up 6.25%) and Maruti Suzuki India (up 5.23%) advanced.

Sun Pharmaceutical Industries (down 2.90%), Asian Paints (down 0.98%), Cipla (down 0.72%) and BPCL (down 0.22%) declined.

Wipro rose 3.82% to Rs 187.60. The IT major and Nutanix yesterday announced the launch of Wipro's Digital Database Services (DDS) powered by Nutanix Era and Nutanix HCI software. This offering will enable enterprises to efficiently manage databases, optimizing time and effort of IT teams.

Tata Motors surged 11.71% to Rs 87.45 after media reports suggested that Jaguar Land Rover (JLR) has restored three-fourth of its budgeted production in China. Chery Jaguar Land Rover Automotive Co or CJLR's manufacturing plant in Changshu, which gradually resumed operations from third week of February, has restored its production capacity to 75% of pre-covid-19 levels, reports said.

Global Markets:

Most European shares opened higher while Asian shares advanced on Thursday following positive developments overnight on a potential new treatment for Covid-19. Markets in Hong Kong and South Korea are closed on Thursday.

Gilead Sciences said Wednesday preliminary results of a coronavirus drug trial showed at least 50% of patients treated with a five-day dosage of Remdesivir improved and more than half were discharged from the hospital within two weeks.

On the economic data front, China said manufacturing activity in the country expanded slightly in April. The official manufacturing Purchasing Managers' Index for April came in at 50.8, as compared to 52 in March. PMI readings above 50 indicate expansion, while those below that level signal contraction.

In US, markets surged on Wednesday as hopes for an effective COVID-19 treatment prompted a broad rally and helped investors shrug off words of warning from US Federal Reserve Chair Jerome Powell.

Meanwhile, Federal Reserve policymakers on Wednesday left interest rates near zero and repeated a vow to do what it takes to shore up the economy, saying the ongoing coronavirus pandemic will weigh heavily on the near-term outlook and poses considerable risks for the medium term.

On the economic data front, the Commerce Department says the gross domestic product, the total output of goods and services, posted a quarterly drop for the first time in six years. The US economy shrank at a 4.8% annual rate last quarter as the coronavirus pandemic shut down much of the country.

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