Key indices pared losses in early afternoon trade with the Nifty 50 index reclaiming 11,150 mark. IT stocks bucked weak sentiment. At 12:28 IST, the barometer index, the S&P BSE Sensex, was down 84.73 points or 0.22% at 38,044.03. The Nifty 50 index lost 38.6 points or 0.34% at 11,155.80.
The broader market was under pressure. The S&P BSE Mid-Cap index was down 0.65% while the S&P BSE Small-Cap index declined 0.59%.
The market breadth, indicating the overall health of the market, was weak. On the BSE, 793 shares rose and 1631 shares fell. A total of 157 shares were unchanged. In Nifty 50 index, 21 stocks advanced while 29 stocks declined.
The NSE's India VIX, a gauge of market's expectation of volatility over the near term, rose 2.46% to 25.14. The Nifty July 2020 futures were trading at 11,127.35, at a discount of 21.6 points compared with the spot at 11,148.95.
On the monthly index options front, the Nifty option chain for 30 July 2020 expiry showed maximum Call OI of 46.77 lakh contracts at the 11,200 strike price. Maximum Put OI of 46.77 lakh contracts was seen at 11,000 strike price.
Total COVID-19 confirmed cases worldwide stood at 16,261,995 with 648,937 deaths. India reported 4,85,114 active cases of COVID-19 infection and 32,771 deaths, according to the data from the Ministry of Health and Family Welfare, Government of India.
Ministry of Health and Family Welfare noted in latest update that on 25th July, India recorded the highest ever COVID-19 recoveries in a single day. 36,145 COVID-19 patients were cured and discharged in the last 24 hours. This has taken the total number of recovered cases to 8,85,576. The recovery rate has achieved another high of fast approaching 64%. It stands at 63.92% today. This means more patients are recovering thus maintaining the steadily widening difference between recovered and active COVID-19 patients. This gap has crossed 4 lakh and currently stands at 4,17,694. Recovered cases are 1.89 times the active cases (4,67,882).
RBI's Financial Stability Report:
The Reserve Bank of India (RBI) released its 21st Financial Stability Report on Friday, which reflects the collective assessment of the Sub-Committee of the Financial Stability and Development Council (FSDC) on risks to financial stability.
RBI said that the capital to risk-weighted assets ratio (CRAR) of Scheduled Commercial Banks (SCBs) edged down to 14.8% in March 2020 from 15% in September 2019 while their gross non-performing asset (GNPA) ratio declined to 8.5% from 9.3% and the provision coverage ratio (PCR) improved to 65.4% from 61.6% over this period.
Macro stress tests for credit risk indicate that the GNPA ratio of all SCBs may increase from 8.5% in March 2020 to 12.5% by March 2021 under the baseline scenario; the ratio may escalate to 14.7% under a very severely stressed scenario.
The Nifty IT index rose 1.78% to 17,593.50, extending gains for second session.
Mphasis (up 5.28%), NIIT Tech (up 5.11%), L&T Infotech (up 3.1%), Mindtree (up 2.52%) and Tech Mahindra (up 2.36%) were top gainers in IT segment.
Stocks in Spotlight:
Alembic Pharmaceuticals was down 1.25%. The pharma company's board approved an enabling resolution for an issuance of equity shares or NCDs along with warrants or any other eligible security through a qualified institutions placement, made by way of a placement document or any other combination thereof for an amount not exceeding Rs 1,200 crore.
Persistent Systems soared 12.34% after consolidated net profit rose 7.37% to Rs 90 crore on 7.01% increase in revenue from operations to Rs 991.38 crore in Q1 June 2020 over Q4 March 2020. EBITDA grew 14.7% M-o-M (month-on-month) and surged 21.8% Y-o-Y (year-on-year) to Rs 146.43 crore in Q1 June 2020. In terms of US$, revenue rose 3.1% Q-o-Q and 9.5% Y-o-Y to $131.02 million during the quarter. Commenting on the Q1 earnings, Christopher O'Connor, the chief executive officer (CEO) and executive director of Persistent Systems, has said that: "In this quarter of the pandemic Persistent achieved 3.1% growth, cumulatively achieved by both business units. Client curiosity on digital solutions has never been higher, which enabled us to share our solutions broadly. The growth came on top of improved business operations."
Adani Power rose 1.57% to Rs 35.55 after the company received approval from its shareholders for its delisting proposal. the company said that the votes casted by the members in favour of the resolution were more than 75% of the total votes casted. The facility of e-voting remained open from 24 June 2020 to 23 July 2020. It further added that the votes casted by the Public Shareholders in favour of the resolution is more than the two times of the number of votes casted as against by the Public shareholders. Therefore, the proposed resolution may be declared as passed as Special Resolution under the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009. On 29 May 2020, Adani Power had received a proposal from Adani Properties (APPL), a member of the promoter and promoter group of the company, for voluntary delisting the equity shares of the company from BSE and NSE. Adani Power's board at its meeting held on 22 June 2020 approved voluntary delisting of shares of the company from the stock exchanges. The company has worked out the floor price of Rs 33.82 per share. The promoter group collectively held 289.16 crore equity shares or 74.97% stake while the public shareholders owned 96.53 crore shares or 25.03% stake in the company as on 30 June 2020.
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