The domestic equity benchmarks ended with strong gains on Tuesday. Barring the Nifty FMCG index, all the sectoral indices on the NSE ended in the green. The barometer index, the S&P BSE Sensex, soared 505.72 points or 1.15% to 44,655.44. The Nifty 50 index added 140.10 points or 1.08% at 13,109.05. Both the indices attained record closing high levels.
Infosys (up 3.33%), ICICI Bank (up 2.63%), HDFC (up 2.10%), TCS (up 1.78%) and Reliance Industries (up 1.27%) were the major market movers.
The sentiment was boosted as India's economy recovered faster than expected in the September quarter. The optimism over progress in COVID-19 vaccine development also supported buying.
The broader market lagged the key benchmarks. The BSE Mid-Cap index rose 0.94% and the BSE Small-Cap index gained 0.82%.
Buyers outpaced sellers. On the BSE, 1922 shares rose and 976 shares fell. A total of 174 shares were unchanged.
OECD Lifts Global Economic Outlook:
In its latest economic outlook, the Organization for Economic Cooperation and Development (OECD) said it expects the global economy to contract 4.2% this year. That reflects an upward revision from an estimate made in September that pointed to a 4.5% fall in real GDP. Looking ahead, the group said worldwide economic growth would average 4% over the next two years. It expects real GDP growth to hit 4.2% in 2021 trimmed from a September forecast of 5% and 3.7% in 2022.
Total COVID-19 confirmed cases worldwide stood at 6,32,36,891 with 14,67,988 deaths. India reported 4,35,603 active cases of COVID-19 infection and 1,37,621 deaths while 88,89,585 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.
Moderna Inc. has reportedly said that it will be seeking emergency use authorisation of its COVID-19 vaccine from the USFDA and European regulators after results from a late-stage study showed its vaccine was 94.1% effective.
Union Health Minister Harsh Vardhan on 30 November 2020, informed that a COVID-19 vaccine will be provided in first 3-4 months of next year. "In the first 3-4 months of next year, there is a possibility that we will be able to provide vaccine to the people of the country. By July-August, we have a plan to provide vaccines to around 25-30 crore people and we are preparing accordingly," he reportedly said.
Sebi's new margin system:
The Securities and Exchange Board of India (Sebi)'s mandated peak margin reporting norms have come into force from Tuesday, 1 December 2020. The new rule is aimed at preventing brokerages from giving additional leverage to traders. This is applicable for both cash and F&O segments.
From 1 December 2020, the maximum intraday leverage that can be offered by a broker will be restricted and this maximum leverage will keep reducing until 1 September 2021 post which a broker can give maximum leverage = VAR + ELM (min 20%) or SPAN + Exposure.
The seasonally adjusted IHS Markit India Manufacturing Purchasing Managers' Index (PMI) was reported at 56.3% in November, highlighting a strong improvement in business conditions. However, the headline number was down from 58.9 in October to a three-month low.
Meanwhile, India's economy shrank for the second straight quarter through September, recording a 7.5% contraction in its Gross Domestic Product (GDP) in July-September, according to data released by the National Statistical Office (NSO) Friday.
The latest data is a significant improvement over the unprecedented 23.9% year-on-year contraction in April-June due to damage inflicted by the pandemic-induced lockdown. However, given that there have been two consecutive quarters of contraction, the economy is technically in recession.
Further, output at India's eight core sectors shrank 2.5% in October with the contraction widening from September's revised 0.1% decline as steel production slid again after a brief revival in the preceding month.
Numbers to Watch:
The yield on 10-year benchmark federal paper rose to 5.930% as compared with 5.911% at close in the previous trading session.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 73.68, compared with its close of 74.05 during the previous trading session.
In the commodities market, Brent crude for February 2021 settlement rose 1 cent at $47.89 a barrel. The contract fell 37 cents, or 0.77% to settle at $47.88 a barrel in the previous trading session.
The US Dow Jones futures were up 352 points, indicating a strong opening in the US stock market today.
Shares in Europe and Asia rose across the board on Tuesday, tracking a strong Chinese economic data.
The Caixin/Markit manufacturing Purchasing Managers' Index for November for China came in at 54.9 from October's 53.6. PMI readings above 50 signify expansion, while those below that level represent contraction.
On Monday, China's official manufacturing PMI for November came in at 52.1, according to the National Bureau of Statistics - the highest reading in more than three years.
The US stocks dipped on Monday as the prospect of a vaccine-driven economic recovery and further central bank stimulus measures eclipsed immediate concerns about the spiking coronavirus pandemic.
Moderna Inc on November 30 applied for U.S. emergency authorization for its COVID-19 vaccine after full results from a late-stage study showed it was 94.1% effective with no serious safety concerns.
President-elect Joe Biden on Monday officially announced his economic team, with former Federal Reserve Chairwoman Janet Yellen chosen to head the Treasury Department and Neera Tanden picked to lead the White House's budget office.
Oil producing group OPEC and its non-OPEC allies led by Russia (OPEC+) had been due to hold a meeting on their joint oil producing policy on Tuesday. But OPEC+ has delayed talks on output policy for next year until Thursday, as key players are still in disagreement on how much oil they should pump amid weak demand.
Buzzing Indian Segment:
The Nifty FMCG index fell 0.04% at 31,705.25. The index rose 0.88% in the past two sessions.
Varun Beverages (down 4.53%), Tata Consumer Products (down 1.87%), Nestle India (down 1.36%), Hindustan Unilever (down 0.23%), Britannia Industries (down 0.16%) and Colgate Palmolive (India) (down 0.06%) declined.
Stocks in Spotlight:
Glenmark Pharmaceuticals gained 1.17% after the drug maker said it received tentative approval from US drug regulator for Axitinib tablets, the generic version of Inlyta tablets of PF Prism C.V. According to IQVIA sales data for the 12 month period ending October 2020, the Inlyta Tablets, achieved annual sales of approximately $518.8 million.
Meanwhile, Dr. Reddy's Laboratories on Saturday (28 November 2020) announced that it has entered into a definitive agreement with Glenmark Pharmaceuticals to acquire select anti-allergy brands in Russia, Ukraine, Kazakhstan and Uzbekistan.
Shares of Dr. Reddy's Laboratories added 0.08%.
ICICI Lombard General Insurance advanced 1.06%. The Insurance Regulatory and Development Authority of India (IRDAI), on Friday (27 November) approved, in principle, the acquisition of the non-life insurance business of Bharti AXA General Insurance Company by ICICI Lombard General Insurance.
Indian Hotels Company rose 1.65% after the company announced the signing of three Taj hotels - two in Kolkata, West Bengal and one in Patna, Bihar. These new hotels are in partnership with Ambuja Neotia Group, who have already partnered with Indian Hotels Company, (IHCL), for two other hotels in the East - Taj Chia Kutir, Darjeeling, West Bengal and Taj Guras Kutir in Gangtok, Sikkim. These five projects will culminate to a total of 500 rooms.
Reliance Capital hit a lower circuit of 5% at Rs 9.23. The company said it has defaulted on interest payments of term loans amounting to Rs 624.61 crore. The term loan of Rs 523.98 crore was from Housing Development Finance Corporation (HDFC) and Rs 100.63 crore from Axis Bank, Reliance Capital said in a filing on Monday (30 November). The interest accruing on the HDFC loan amounts to Rs 4.77 crore and to the Axis Bank loan Rs 0.71 crore. The default took place on 31 October 2020.
November Auto Sales:
Maruti Suzuki India rose 1.03%. The car marker's total auto sales rose by 1.7% to 153,223 units in November 2020 from 150,630 units sold in November 2019.
Bajaj Auto rose 2.27%. The two-wheeler major's total sales rose 5% to 4,22,240 units in November 2020 from 4,03,223 units in November 2019.
Mahindra & Mahindra (M&M) rose 1.60%. The company said its total tractor sales jumped 56% to 32,726 units in November 2020 over 21,031 in November 2019. Further, M&M said that its total automobile sales (passenger vehicles+commercial vehicles+exports) rose 4% to 42,731 units in November 2020 from 41,235 units in November 2019. M&M's total auto sales slipped 3.67% in November 2020 from 44,359 units sold in October 2020.
VST Tillers & Tractors rose 0.29%. The company's total auto sales surged 59.96% to 2,889 units in November 2020 from 1,806 units in November 2019.
TVS Motor Company rose 0.16%. The company's total sales grew 21% year on year to 322,709 units in November 2020.
Ashok Leyland rose 0.54%. The commercial vehicles maker's total auto sales jumped 5% to 10,659 units in November 2020 compared with 10,175 units sold in November 2019.
Eicher Motors fell 0.14%. VE Commercial Vehicles, an unlisted subsidiary of Eicher Motors, announced that its total commercial vehicles (CV) sales rose 3.2% to 3,710 units in November 2020 from 3,592 units in November 2019.
Escorts fell 2.05%. The Agri Machinery Segment (EAM) recorded 33% jump in total tractor sales to 10,165 units in November 2020 from 7,642 units sold in November 2019.
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