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Buying in second half helps markets to end higher on Thursday
Apr-22-2021
Buying in second half of the trade helped Indian equity benchmarks to end near intraday high points. Markets started the session on pessimistic note as traders remained worried over the second wave of COVID-19 in the country and tightening of restrictions in various states weighted down on the markets. India reported 315,802 fresh coronavirus infections on Thursday, taking the cumulative caseload to 15,924,806. Sentiments also remain dampened after Care Ratings revised down its forecast for GDP growth to 10.2 per cent in 2021-22 from earlier projection of 10.7-10.9 per cent, with economic activities getting affected across the country due to curbs imposed by states amid surge in COVID-19 cases. Adding to the worries, domestic rating agency ICRA has cut its 2021-22 GDP growth estimate by 0.5 per cent on the upper end. The agency now expects the economy to grow 10-10.5 per cent in 2021-22, against the 10-11 per cent estimated earlier. Starting with Maharashtra, a slew of other pockets in the country like Delhi have been taking to localised lockdowns to arrest the climbing COVID-19 cases, which derails economic activity.
 
However, markets started paring losses as traders took some support with Commerce Secretary Anup Wadhawan’s statement that the country's exports are reviving and the shipments are expected to be in the solid positive territory in this financial year. He said that exports recorded a significant contraction in April last year but gradually things started improving and the shipments have entered the positive territory. Key gauges entered into green terrain in second half of the trade as traders opted to buy beaten down but fundamentally strong stocks. Traders also took some solace after the Retirement fund body, Employees' Provident Fund Organisation (EPFO) in its latest ‘Provisional Estimate of Net Payroll’ data report has showed that India created 1237489 new jobs in the month of February 2021 as against revised figure of 1195383 in January 2021.
 
Positive opening in European counters too aided support with European markets were trading higher after stumbling earlier in the week, as a set of strong earnings reports brightened sentiment ahead of the European Central Bank's policy decision. Asian markets ended mostly higher on Thursday, after S&P Global Ratings maintained Japan's sovereign ratings with 'stable' outlook. The rating was affirmed at 'A+' citing the country's exceptional external position, prosperous and diversified economy, political stability, and savings-rich financial system.
 
Back home, Lauding the performance of Exporters, for doing the nation proud in such difficult times through their resilience and hardwork, Union Minister of Railways, Commerce & Industry, Consumer Affairs, and Food & Public Distribution Piyush Goyal has said that during 2020-21, the Country’s cumulative value of overall exports declined by just 7% compared to the previous year, despite disruptions, uncertainty, lockdowns, gradual unlockdowns, supply chain difficulties, labour issues, and order cancellations in the Covid year. On the sectoral front, aviation stocks remained in focus as Indian aviation regulator DGCA said around 78.22 lakh domestic passengers travelled by air in March, which is slightly lower than 78.27 lakh who travelled in February.
Finally, the BSE Sensex gained 374.87 points or 0.79% to 48,080.67, while the CNX Nifty was up by 109.75 points or 0.77% to 14,406.15.

The BSE Sensex touched high and low of 48143.16 and 47204.50, respectively and there 19 stocks advancing against 11 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index gained 0.28%, while Small cap index was up by 0.59%.

The top gaining sectoral indices on the BSE were Bankex up by 2.14%, Metal up by 1.86%, Realty up by 1.40%, PSU up by 0.89% and Basic Materials up by 0.88%, while Consumer Durables down by 1.51%, FMCG down by 0.60%, IT down by 0.16%, Consumer Discretionary Goods & Services down by 0.14%, TECK down by 0.09% were the top losing indices on BSE.

The top gainers on the Sensex were ICICI Bank up by 3.60%, HDFC up by 2.67%, Bajaj Auto up by 2.30%, HDFC Bank up by 2.25% and SBI up by 2.12%. On the flip side, Titan Company down by 2.75%, Hindustan Unilever down by 1.81%, Asian Paints down by 1.80%, Nestle down by 1.80% and Ultratech Cement down by 1.77% were the top losers.

Meanwhile, with economic activities getting affected across the India due to curbs imposed by states amid surge in COVID-19 cases, Care Ratings in its latest report has revised down its forecast for gross domestic product (GDP) growth to 10.2 per cent for current financial year (FY22) from earlier projection of 10.7-10.9 per cent. This is the third revision by the rating agency in the last one month.

It said ‘we have revised our forecast for GDP growth for FY22 as the underlying conditions have changed rapidly in the last 30 days or so. It stands now at 10.2 per cent.’ On March 24, 2021, the agency had projected GDP growth between 11-11.2 per cent based on GVA (gross value added) growth of 10.2 per cent. It mentioned the spread of the virus in Maharashtra had led to the announcement of a lockdown by the state government which began in a less stringent manner from the first week of April. Factoring the potential loss of economic output due to the restrictions in the state, the agency, on April 5, lowered its GDP forecast for the current fiscal year to 10.7-10.9 per cent.

It added but the lockdown was made more obtrusive to business activity by April 20, with more stringency expected for the forthcoming fortnight. Further, the spread of the virus to other states has caused similar actions by governments which have ranged from night curfews and weekend lockdowns to full lockdowns. The report said two events in the country -- state elections and Kumbh Mela -- have seen millions of people coming together with social distancing norms not being followed. It said this has potential to spread the virus at an exponential rate throughout the country and several states have announced measures to test people returning from the pilgrimage.

The CNX Nifty traded in a range of 14,151.40 and 14,424.75 and there were 28 stocks advancing against 22 stocks declining on the index.

The top gainers on Nifty were ICICI Bank up by 3.60%, Wipro up by 3.52%, JSW Steel up by 3.25%, Tata Steel up by 3.06% and HDFC up by 2.64%. On the flip side, Titan Company down by 2.76%, Shree Cement down by 2.72%, Tata Consumer down by 2.15%, Hindustan Unilever down by 2.00% and Nestle down by 1.79% were the top losers.

European markets were trading higher, UK’s FTSE 100 increased 24.24 points or 0.35% to 6,919.53, France’s CAC increased 51.52 points or 0.83% to 6,262.07 and Germany’s DAX was up by 71.79 points or 0.47% to 15,267.76.

Asian markets ended mostly higher on Thursday, supported by firm cues from Wall Street overnight. Although, investors are remained cautious amid continuing surge in corona-virus cases along with possible lockdowns in major cities in Japan, capped further gains. Japan reported nationwide daily infections of topped 5000 for the first time in three months. The Japanese government is considering issuing fresh corona-virus state of emergency in Tokyo and three western prefectures for a period from Sunday to May 11. Chinese shares ended lower as Sino-US tensions dampened the market sentiment, while robust Chinese inflation data also raised investor concerns over policy tightening.

Asian Indices

Last Trade           

Change in Points

Change in %

Shanghai Composite

3,465.11-7.82-0.23

Hang Seng

28,755.34133.420.47

Jakarta Composite

5,994.180.940.02

KLSE Composite

1,607.73

11.15

0.70

Nikkei 225

29,188.17679.622.38

Straits Times

3,187.7832.721.04

KOSPI Composite

3,177.525.860.18

Taiwan Weighted

17,096.97-105.14-0.61
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