Market Wrap, May 07: Here’s all that happened in the markets today

Firm global cues and healthy corporate earnings back home helped equity indices settle higher for the third straight day on Friday. In Europe, stocks hit a record high as strong economic data from major economies as well as upbeat earnings underpinned hopes of a swift economic recovery.

The pan-European STOXX 600 index rose 0.3 per cent while the German DAX rose 0.9 per cent. France’s CAC 40 hit its highest level since November 2000 and the UK’s FTSE 100 breached the 7,100 mark for the first time since February 2020.

Earlier in Asia, the Nikkei share average ticked up 0.09 per cent while the broader Topix rose 0.29 per cent. South Korea’s Kospi added 0.6 per cent and Australia’s S&P/ASX200 index gained 0.3 per cent.

Domestically, the frontline indices gained little over 0.5 per cent as volatility gauge, India VIX, eased 5.5 per cent and propelled largely by metal stocks. The Nifty Metal index advanced 5 per cent on the NSE while all other sectoral indices clocked gains between 0.04 per cent and 1 per cent with an exception of the Nifty PSU Bank index, which was down 0.14 per cent.

Against this backdrop, the benchmark Nifty50 shut shop at 14,823 levels, up 98 points. On the BSE, the 30-share Sensex index closed 257 points higher at 49,206 levels.

Individually, Tata Steel, Hindalco, JSW Steel, Adani Ports, SBI Life, M&M, and HDFC gained between 2.5 per cent and 7.5 per cent and were the top Nifty gainers of the day. On the downside, Tata Consumer Products, Bajaj Auto, Hero MotoCorp, Bajaj Finance, and Eicher Motors declined up to 3.5 per cent.

Trading in the broader markets, however, remained mixed. The S&P BSE MidCap index dipped 0.04 per cent while the SmallCap index ended 0.15 per cent higher.

On a weekly basis, markets rose for the third straight week for the first time since January. While the Sensex and Nifty indices gained 1 per cent each during the week, the Nifty Bank index added 0.4 per cent and the Nifty Metal index was up 10 per cent.

Buzzing stocks

Shares of Tata Steel moved higher by 8 per cent to Rs 1,129, their fresh record high on the BSE, in the intra-day trade on Friday. The stock has gained 11 per cent in the past two trading days after the company reported its best-ever all-round performance in Q4. With the past two days’gain, Tata Steel has now rallied 97 per cent since February 1.

That apart, shares of SBI Life Insurance rallied 7 per cent to hit a record high of Rs 1,040 on the BSE in the intra-day trade today after more than 40 million shares, or 4 per cent equity of the insurance company, changed hands via block deals. The stock surpassed its previous high of Rs 1,030 touched on October 30, 2019.

Vedanta shares, meanwhile, rallied 7 per cent and hit a three-year high of Rs 288 on the BSE in the intra-day trade on healthy and improving operating performance, supported by stable volume across business segments and increased commodity prices. The stock was trading at its highest level since May 2018.

Owing to a sharp run-up in stock price of Vedanta, the company has regained market capitalisation of Rs 1 trillion. Earlier today, the scrip was trading with the market-cap of Rs 1.06 trillion.

Lastly, shares of Tata Consumer Products dipped 6 per cent to Rs 614 on the BSE in the intra-day trade on Friday after the company reported a per cent rise in its consolidated Ebitda at Rs 317 crore for the quarter ended March 2021 (Q4FY21). Margins, too, contracted by 253 basis points (bps) to 10.44 per cent from 12.97 per cent in Q4FY20.

On the earnings front, HDFC today reported a 42.43 per cent year-on-year growth in standalone net profit at Rs 3,179.8 crore for January-March quarter of FY21. This compares with profit of Rs 2,232.5 crore reported in the previous year period. Its revenue, however, contracted 2 per cent on year to Rs 11,697 crore. HDFC declared a dividend of Rs 23 for FY21.

Dabur, meanwhile, reported 34.4 per cent increase in consolidated net profit at Rs 378 crore while its total income stood at Rs 2,422 crore.

Economic developments of the day:

>> The finance ministry on Friday said that the second wave of coronavirus has posed a downside risk to economic activity in the April-June quarter of financial year 2022. However, it expects a muted economic impact as compared to the first wave.

>> Meanwhile, Fitch Solutions believes India is likely to breach its fiscal deficit target in FY22 mainly due to revenue shortfall. Against the government’s estimate of 6.8 per cent, the agency expects the deficit to widen to 8.3 per cent.

>> Lastly, S&P Global Ratings on Friday said India’s credit rating would be retained at the current level for the next two years, and the country will see a slightly faster pace of growth in the next couple of years that will support its sovereign rating.