Stock Market Live: Sensex, Nifty plunge over 2% as record new COVID-19 cases stoke growth concerns

Gaurav Garg, Head of Research at CapitalVia Global Research

The market opened on a flat note following the mixed sentiments in the markets but could not maintain the higher levels and tumble down below 14,500. The increase in corona cases has led to negative sentiments in the domestic market. On the other hand, US markets closed higher as the unemployment rate has fallen to 6 percent. The Asian market was mostly trading in green following the US markets and positive overall sentiments.

We can expect a recovery in the Indian market as well and the market can be expected to be in the range of 14,350-14,900 in the coming week. Although the increase in corona cases can give an opportunity to bears to make a strong grip on the market.

Investors’ wealth tumbles over Rs 4.54 lakh cr as markets crash

Investors’ wealth tumbled over Rs 4.54 lakh crore in morning trade on Monday as markets crashed amid a sharp spike in coronavirus cases in the country. The 30-share BSE benchmark index plummeted 1,449.03 points to 48,580.80 in morning trade. Following this, the market capitalisation of BSE-listed companies dived Rs 4,54,987.72 crore to Rs 2,02,71,414.07 crore. The BSE midcap index and small cap index were trading over 2 per cent lower.

Financials most vulnerable to COVID 2nd wave; positive on IT: Raamdeo Agrawal

Raamdeo Agrawal, Chairman of Motilal Oswal Financial Services on Monday said that the financial sector is the most vulnerable to the second wave of COVID-19 as they haven’t recovered from the impact of the first wave fully. “Financial sector which suffered the most last time, again they are vulnerable because they will get impacted. Less so this time, but clearly even now that is the most vulnerable part of the economy, particularly the unsecured loans and the lower end of the population,” he said in an interview with CNBC-TV18.  The market veteran is however positive on the IT sector and expects quarter-on-quarter (QoQ) earnings growth to be more than 5-6 percent. Click here to read more.

Lockdown at worst will lead to a passing 2-3-month blip, says Marcellus’ Saurabh Mukherjea

The impact of the fresh lockdown and restrictions announced by the Maharashtra government will be noticeable for the entertainment industry, restaurants and airlines, while the IT sector is unlikely to be hit, said Saurabh Mukherjea, founder of Marcellus Investment Managers, on Monday. Mukherjea, however, said the lockdown at worst will lead to a passing 2-3-month blip rather than a structural hit.

“It’s not a good thing to have to go through a lockdown all over again in one of India’s most important industrial states (Maharashtra), but from a market sentiment perspective, the market will look through this. This looks like a 2-3 month blip for a critical industrial state but it is not one of those game changers for the market as a whole,” said Mukherjea in an interview with CNBC-TV18.

According to him, the global recovery bodes well for the large Indian IT services companies like TCS and Infosys. “So, I do not think the Maharashtra lockdown is going to impact the sector.” Read more.

Hemang Jani, Head Equity Strategy, Broking & Distribution, Motilal Oswal Financial Services

Market over the next few days would monitor as to how the situation pans out in Maharashtra and also in other states especially 8-10 other states where the COVID cases are rising rampantly. Apart from this, the Q4 numbers would start pouring in from mid-April with Infosys and Wipro being among the first ones to declare. We are expecting strong 4QFY21 numbers for the IT sector and expect robust FY22 outlook from the management despite cost pressures. Overall we believe IT and Metals to fare better in comparison to other sectors given the cost pressures faced during the Q4. Thus the month of April is likely to be highly volatile with Q4 earnings, rising covid cases and higher bond yields to determine the trend.

Govt promulgates Insolvency and Bankruptcy Code Ordinance, 2021

The government on Sunday promulgated Insolvency and Bankruptcy Code (Amendment) Ordinance, 2021, while announcing a pre-packaged insolvency framework for MSMEs. This will allow creditors and debtors to work on an informal plan and then submit it for approval. In June last year, the sub-committee of the Insolvency Law Committee (ILC), constituted by the government designed a pre-pack framework with the basic structure of the Insolvency and Bankruptcy Code (IBC), and submitted its report in October.

A pre-pack or pre-packaged deal is a kind of restructuring plan which is agreed to by the debtor and its creditors prior to the insolvency filing and then sanctioned by the court on an expedited basis. The incumbent management typically retains control until the final agreement is agreed upon. The informality of the process is aimed at a faster resolution of distressed firms. Compared to a regular corporate insolvency resolution process (CIRP) under the IBC, pre-packs have the advantage of being a more informal process and the possibility of closure in a shorter period of time. Read more.

Customers for 100-125cc still not returning: Bajaj Auto

Bajaj Auto is clocking record exports, but domestic demand is not as strong, the company’s Executive Director Rakesh Sharma told CNBC-TV18. The company hopes to cross-sales 4 lakh units overall in April and May, Sharma said. He does not expect a major supply chain disruption in the ongoing second wave of the COVID-19 pandemic. The company is closely watching domestic demand, which has been muted in the last couple of months. He said that customers for the company’s mass-market 100-125 cc are yet to return in a big way. Lower access to funding has been one of the reasons for the subdued performance of entry-level segment, Sharma said. Compared to entry-level, the premium segment (125 cc plus bikes) has seen only a 4 percent decline, Sharma said. Read more.

SAIL shares rally over 5% to hit 52-week high as it clocks best quarterly sales during March quarter

Shares of Steel Authority of India Ltd (SAIL) surged over 5 percent to hit a fresh 52-week high of Rs 88.65 apiece on the BSE after the company clocked its best-ever quarterly sales during the quarter ended March 2021. The company’s sales were at 4.27 million tonnes (MT) during Q4FY21, up 14 percent over the year-ago period. The domestic steel giant’s crude steel production too increased by 6 percent during the quarter to 4.55 MT. The company had clocked 3.74 MT sales and 4.31 MT crude steel output during the January-March quarter of fiscal 2019-20.

Buzzing | Shares of PVR and Inox Leisure plunged over 6-8 percent on Monday after the Maharashtra government announced to shut cinema theatres amid rising COVID-19 cases in the state. In a new set of regulations released Sunday evening, the state government imposed a number of restrictions including a total lockdown during weekends.

Cadila Healthcare | Zydus Cadila announced that its Phase III clinical trials with Pegylated Interferon Alpha 2b, PegiHepTM has shown promising results in treating COVID-19. With these positive results, the company has applied for an approval for additional indication with the DCGI for the use of PegIFN in the treatment of COVID 19, the company said.

Just In | India Manufacturing PMI for March comes in at a 7-month low of 55.4 versus 57.5 in February.

Credit Suisse says local steel prices unlikely to fall sharply; JP Morgan bullish on SAIL

Domestic steel prices are unlikely to fall sharply in the short term, according to a research note by Credit Suisse. The note said that Indian domestic steel prices were now at an 11-17 percent discount to imports from China and other countries with which India has signed a Free Trade Agreement. Credit Suisse said China’s decision to cut export rebates was also a positive for steel prices in India. It said that a favourable supply-demand balance and companies’ decision to pass on higher costs to consumers should support steel prices globally. Credit Suisse’s favorite bets are Tata Steel and Jindal Steel and Power Ltd. Read more.

Manish Hathiramani, Proprietary Index Trader and Technical Analyst, Deen Dayal Investments

We are still trading in a restricted range which is between 14,650 and 14,900. Unless we are able to get past 14950, the Index won’t propel further. If we manage to do that, the markets could move towards 15,300. On the flip side, if we break 14,500-14,600 on a closing basis, the Nifty can go down further to retest the previous lows of 14,200.

Federal Bank Q4FY21 Update |  The bank reported best deposit growth in eight quarters and best advances growth in nine quarters. Deposits at Rs 172655 crore, up 13.4 percent, YoY and 6.8 percent, QoQ. Advances at Rs 134876 crore, rose 8.6 percent, YoY and 5.2 percent, QoQ. CASA at Rs 58,381 crore rose 25.7 percent, YoY and 4.7 percent, QoQ. CASA ratio was at 33.81 percent versus 30.5 percent YoY and versus 34.5 percent, QoQ. Customer deposits at Rs 163620 crore, up 12.3 percent, YoY and 4.2 percent QoQ.

Yes Bank Q4FY21 Update | The bank’s advances rose 0.8 percent, YoY and 1.8 percent QoQ. Deposits increased 54.7 percent, YoY and 11.4 percent, QoQ. CASA was up 51.8 percent, YoY and 12.2 percent QoQ.

Adani Ports & SEZ | The company has acquired an additional 25 percent stake in Krishnapatnam Port for Rs 2,800 crore. With this acquisition, the company now holds a 100 percent stake in the Krishnapatnam Port.

HDFC Bank | The bank’s advances aggregated to approximately Rs 11,320 billion as of March 31, 2021, a growth of around 13.9 percent over Rs 9,937 billion as of March 31, 2020 and a growth of around 4.6 percent over Rs 10,823 billion as of December 31, 2020. Deposits aggregated to approximately Rs 13,350 billion as of March 31, 2021, a growth of around 16.3 percent over Rs 11,475 billion as of March 31, 2020 and a growth of around 5.0 percent over Rs 12,711 billion as of December 31, 2020.

MFs turn net buyers; invest Rs 2,476 crore in equities in March

Mutual funds invested Rs 2,476 crore in equities in March, making it the first such infusion in 10 months, as consolidation in the market provided investment opportunities to fund managers. According to Sebi data, MFs put in a net amount of Rs 2,476.5 crore in equities in March. Before that, MFs withdrew Rs 16,306 crore from equities in February, Rs 13,032 crore in January, Rs 26,428 crore in December, Rs 30,760 crore in November, Rs 14,492 crore in October, Rs 4,134 crore in September, Rs 9,213 crore in August, Rs 9,195 crore in July and Rs 612 crore in June.

Market Opens | The Indian equity market opened lower on Monday dragged by selling in banks, FMCG, auto and financial stocks. At 09:16 am, the Sensex fell 305.03 points or 0.61 percent at 49,724.80, and the Nifty was down 82 points or 0.55 percent at 14,785.40. Broader markets, smallcap and midcap indices also fell over half a percent each.

Eight of top-10 most valued companies add cumulatively over Rs 1.2 lakh cr in m-cap | Eight of the top-10 most valued companies together added Rs 1,28,503.47 crore in market valuation last week, with IT majors Tata Consultancy Services and Infosys leading from the front. The valuation of TCS jumped Rs 36,158.22 crore to reach Rs 11,71,082.67 crore, becoming the biggest gainer among the top-10 most valued companies. The m-cap of HDFC Bank declined by Rs 3,142.29 crore to Rs 8,19,474.22 crore and that of HDFC dipped by Rs 171.38 crore to Rs 4,56,569.82 crore.

Forex reserves fall by USD 2.986 bln to USD 579.285 bln | The country’s foreign exchange reserves declined by USD 2.986 billion to reach USD 579.285 billion in the week ended March 26, RBI data showed. The fall in reserves was on account of a decrease in foreign currency assets (FCA), a major component of the overall reserves. FCA declined by USD 3.226 billion to USD 537.953 billion. In the previous week ended March 19, the forex kitty had increased by USD 233 million to USD 582.271 billion.

FPIs invest Rs 17,304 crore in March | Continuing the buying spree for the third consecutive month, foreign portfolio investors (FPIs) have invested Rs 17,304 crore in Indian markets so far in March. According to the depositories data, FPIs invested Rs 10,482 crore into equities and Rs 6,822 crore in the debt segment during March 1-31. The total net investment stood at Rs 17,304 crore during the period under review.