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Market snaps 4-day winning run; Nifty slips below 11,900
22-Oct-20   16:58 Hrs IST

Key equity indices ended with modest losses after a volatile session on Thursday. The Nifty ended below the 11,900 mark. Markets witnessed volatility due to expiry of weekly index options on the NSE.

The barometer index, the S&P BSE Sensex, fell 148.82 points or 0.37% at 40,558.49. The Nifty 50 index lost 41.20 points or 0.35% to 11,896.45.

Investors booked profits after the Sensex rose 2.46% and the Nifty climbed 2.20% in the previous four consecutive sessions. Domestic shares also mirrored weakness in other global stock markets. Investor sentiment was hit after US President Donald Trump on Wednesday reportedly accused Democrats of being unwilling to craft an acceptable compromise on stimulus, following reports of progress earlier in the day.

Infosys (down 1.58%), HDFC Bank (down 1.13%) and Reliance Industries (down 0.76%) dragged the indices.

In the broader market, the BSE Mid-Cap index rose 0.54% and the BSE Small-Cap index gained 0.85%.

The market breadth was positive. On the BSE, 1422 shares rose and 1204 shares fell. A total of 167 shares were unchanged.


The government has said that the country's COVID-19 recovery rate has reached 88.81%. In the last 24 hours, more than 61 thousand COVID patients have recovered. Currently, India's case fatality rate is at 1.51%, which is one of the lowest globally.

India reported 7,15,812 active cases of COVID-19 infection and 1,16,616 deaths while 68,74,518 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 41,171,093 with 1,130,597 deaths, according to data from Johns Hopkins University.

Numbers to Watch:

The yield on 10-year benchmark federal paper rose to 5.916% as compared with 5.912% 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 73.54, compared with its close of 73.58 during the previous trading session.

In the commodities market, Brent crude for December 2020 settlement rose 26 cents at $41.99 a barrel. The contract fell $1.43, or 3.31% to settle at $41.73 a barrel in the previous trading session.

Foreign Markets:

European markets declined while Asian markets ended mostly lower on Thursday as the uncertainty over U.S. coronavirus stimulus continued.

The IMF on Wednesday downgraded its forecast for Asia-Pacific to a negative 2.2% in 2020. Jonathan D. Ostry, IMF's acting director of the Asia and Pacific Department, said: “Our latest Regional Economic Outlook shows that a recovery started in the third quarter, but growth engines are not all firing with the same power across countries, leading to a multispeed recovery.”

The US stock market finished lacklustre session lower on Wednesday, 21 October 2020, as investors weighed the latest developments in reaching a stimulus agreement. Rising coronavirus cases on both sides of the Atlantic and a busy earnings day were also grabbing investor attention.

Traders kept an eye on the latest developments in Washington, as lawmakers try to reach an agreement on a new stimulus bill. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin failed to reach a deal before a Tuesday deadline and now aim to finalize a proposal before the weekend.

Wall Street's fear gauge touched a one-month high earlier on Wednesday as the U.S. election campaign enters its final stretch. President Donald Trump and Democratic challenger Joe Biden will face off in their second and final debate on Thursday night where Trump will attempt to change the trajectory of a race that Biden is leading, according to national polls.

Most of the major sectors ended the day showing only modest moves, contributing to the lackluster close by the broader markets.

Buzzing Index:

The Nifty Bank index fell 0.61% to 24,484.15. The index rose 6.77% in the past four sessions.

IndusInd Bank (down 3.1%), Bandhan Bank (down 1.82%), ICICI Bank (down 1.76%), HDFC Bank (down 1.13%), Federal Bank (down 0.7%), State Bank of India (down 0.27%) and Kotak Mahindra Bank (down 0.19%) declined.

Earnings in Focus:

SBI Cards and Payment Services slumped 4.63% after the company's consolidated net profit slumped 46% to Rs 206.14 crore in Q2 September 2020 from Rs 381 crore registered in the same period last year. Total income stood at Rs 2,512.72 in Q2 September 2020, rising 5.75% from Rs 2,376.20 crore in Q2 September 2019.

Net profit was dented after company's impairment losses & bad debts grew by 162% to Rs 862 crore in Q2 September 2020 from Q2 September 2019. The company said management overlay provision created of Rs 268 crore in Q2 September 2020 while total management overlay provision is at Rs 758 crore.

Asian Paints fell 0.67%. On a consolidated basis, the paint major reported 1.16% rise in net profit to Rs 851.9 crore on 5.93% increase in revenue from operations to Rs 5,350.23 crore in Q2 September 2020 over Q2 September 2019. Profit before tax (PBT) came at Rs 1,145 crore in Q2 September 2020, rising 34.4% from Rs 852 crore in the corresponding period last year. Total tax expense stood at Rs 293 crore in Q2 September 2020 compared with Rs 7.23 crore in Q2 September 2019. Profit before depreciation, interest, tax and other income (PBDIT) for the group increased by 32.5% to Rs 1,265.20 crore in Q2 September 2020 from RS 954.82 crore in Q2 September 2019. The result was announced during market hours today, 22 October 2020.

Bajaj Auto fell 0.63%. On a standalone basis, profit after tax fell 19% to Rs 1,138 crore and revenue from operations declined 7% to Rs 7,156 crore during the period under review. EBITDA was almost flat at Rs 1300 crore in Q2 September 2020 compared with Rs 1305 crore in Q2 September 2019. EBITDA margin stood at 18.2% in Q2 September 2020, higher than 16.9% in Q2 September 2019.

Sagar Cements spurted 14.66% after the consolidated net profit soared 919.7% to Rs 50.17 crore on 22.8% increase in net sales to Rs 325.88 crore in Q2 September 2020 over Q2 September 2019. Consolidated profit before tax (PBT) surged 969.80% to Rs 76.17 crore in Q2 September 2020 as against Rs 7.12 crore in Q2 September 2019. Current tax expense for the quarter jumped 286.60% to Rs 18.71 crore as against Rs 4.84 crore paid in Q2 September 2019. The Q2 result was declared post trading hours yesterday, 21 October 2020.

Bajaj Finserv fell 0.57% after the company's consolidated net profit fell 18.06% to Rs 986.29 crore on 5.82% increase in total income to Rs 15,051.59 crore in Q2 September 2020 fover Q2 September 2019. Profit before tax (PBT) stood at Rs 2,156 crore in Q2 September 2020, falling nearly 18% from Rs 2,626 crore in the same period last year. Total tax expense fell 11% year on year to Rs 538.33 crore in Q2 September 2020 over Q2 September 2019. The announcement was made after market hours yesterday, 21 October 2020.

Syngene International fell 2.84% after the company reported 34.3% fall in consolidated net profit to Rs 84.10 crore on 11.8% rise in net sales to Rs 519.60 crore in Q2 FY21 over Q2 FY20. Syngene's second quarter performance was primarily driven by good performance in the discovery services and dedicated R&D centre divisions. The company commenced manufacturing of Remdesivir at its manufacturing facility in Bengaluru with initial distribution expected during the third quarter.

Stocks in Spotlight:

Vedanta advanced 3.21% to Rs 104.50 after the company said its board will consider first interim dividend on 24 October 2020.

Dr Reddy's Laboratories shed 0.46% to Rs 5023.60. The company said that it has isolated all data center services to take required preventive actions in the wake of a cyber attack.

Aurobindo Pharma tumbled 2.84% to Rs 782.45. The company's wholly-owned step-down subsidiary, AuroLife Pharma LLC, received a warning letter from the US drug regulator for its oral solid manufacturing facility situated at Dayton, New Jersey. This letter follows the earlier letter dated 4 June 2020 issuing a Official Action Indicated (OAI) status for this facility. The company assured that the existing business from this facility will not be impacted. The company also said it will be engaging with the regulator and is fully committed in resolving this issue at the earliest.

Hemisphere Properties India (HPIL) hit a lower circuit of 5% at Rs 100.70, following its debut on the stock exchanges today (22 October 2020). HPIL was formed as part of the disinvestment exercise carried out by the Government of India in respect of its holdings in the erstwhile VSNL (currently known as Tata Communications).

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