Sensex gains 436 pts, Nifty settles above 16,600 level

The domestic equity barometers ended with strong gains on Thursday, snapping its two days losing streak. Oil & gas, IT and metal scrips boosted the indices while auto and financial service stocks dragged. The Nifty managed to close above 16,600 level, rising from its intraday low of 16,443.05 attained in the early trade.

As per provisional closing data, the barometer index, the S&P BSE Sensex, up 436.94 points or 0.79% to 55,818.11. The Nifty 50 index rose 105.25 points or 0.64% to 16,628.

In the broader market, the S&P BSE Mid-Cap index fell 0.04% while the S&P BSE Small-Cap index added 0.60%.

 

The market breadth was positive. On the BSE 1,973 shares rose while 1,334 shares fell. A total of 137 shares were unchanged.

COVID-19 Update:

India's active caseload currently stands at 19,509. In the last 24 hours, 3,712 new cases and 2,584 recoveries have been recorded. The daily positivity rate is 0.67%. The recovery rate currently is at 98.74%.

The media reported that Maharashtra CM Uddhav Thackeray has called a meeting of the COVID-19 task force today, in the view of surging COVID-19 cases in the state.

Buzzing Index:

The Nifty Metal index rose 1.20% to 5,400.80. The index added 3.63% in four trading sessions.

Among the components of the Nifty Metal index, Hindustan Copper (up 2.75%), Adani Enterprises (up 2.65%), Vedanta (up 2.07%), Tata Steel (up 1.81%) and NMDC (up 1.19%) were the top gainers.

Among the other gainers were Jindal Stainless (up 1.11%), Welspun Corp (up 1%), JSW Steel (up 0.84%), Jindal Steel & Power (up 0.35%) and National Aluminium Company (up 0.16%).

On the other hand, Hindustan Zinc (down 1.39%), Ratnamani Metals & Tubes (down 0.62%) and Hindalco Industries (down 0.12%) edged lower.

Vedanta rose 2.07% after the company said that its board will meet on Saturday, 4 June 2022, to consider raising funds by issuing non-convertible debentures in one or more tranches. The company proposes to offer rated, secured, redeemable, non-cumulative and non-convertible debentures aggregating up to Rs 4,100 crore.

Welspun Corp gained 1% after the East Pipes Integrated Company, the associate company of Welspun Corp, has signed a contract with the Saline Water Conversion Corporation valued at 490 million Saudi Riyal. The order is for supplying and deliver steel pipes for a water transmission project, which will span a period of 12 months. The financial impact will reflect in East Pipes' financial statements in 2022/2023.

Stocks in Spotlight:

Reliance Industries advanced 3.64%. Reliance Brands (RBL) and Plastic Legno SPA have signed a joint venture arrangement through which RBL will acquire a 40% stake in Plastic Legno SPA's toy manufacturing business in India. This investment by RBL serves a dual purpose, bringing in vertical integration for RBL's toy business and helping diversify the supply chain with a long-term strategic interest in building toy manufacturing in India.

Greaves Cotton rose 1.24% after the company announced that Abdul Latif Jameel International DMCC will infuse $150 million (Rs 1160 crore) for 35.8% stake in company's wholly owned subsidiary, Greaves Electric Mobility ("GEMPL"). GEMPL has the right to secure additional funding of $70 million from investor over the next 12 months. Post money equity value for Greaves Electric Mobility stands at $419 million or Rs 3238 crore. Greaves Cotton market cap stand at Rs 3745 crore. Greaves Electric will continue to remain subsidiary of Greaves Cotton even after both the rounds of fund infusion.

Hero MotoCorp fell 3.43% after the company said that the company had sold 486,704 two-wheeler units in May 2022 as against 183,044 units sold in May 2021. Sequentially, this translates into a growth of 16% over the month of April 2022, when the company had sold 418,622 units. Total domestic sales in May 2021 stood at 4,66,466 unit in May 2022, which is significantly higher as compared with 1,59,561 units sold in May 2021. Exports during the period under review declined 13.8% YoY to 20,238 units. Hero MotoCorp stated that the sales in May 2021 were impacted due to the resurgence in Covid-19 cases and subsequent lockdowns.

Eicher Motors declined 1.50% after the company recorded total motorcycles sales of 63,643 units in May 2022 as against 27,294 units in May 2021. While the company sold 53,835 units (up 137% YoY) of models with engine capacity upto 350cc, sales of models with engine capacity exceeding 350cc was 9,808 units (up 115% YoY). Motorcycles sales in the international business rose by 40% to 10,118 units in May 2022 over May 2021.

Religare Enterprises surged 11.18% after the company said its lenders in principally agreed to the proposed one time settlement of Religare Finvest. Religare Finvest Limited (RFL), a wholly-owned subsidiary of Religare Enterprises (REL), has been a victim of siphoning off of funds by its erstwhile promoters. It has initiated and pursuing legal actions for recovery and now begun its path towards revival. Post RFL's one time settlement completion, it will have healthy prudential ratios well above those prescribed by RBI, REL said in a statement.

Cipla rose 0.11%. The drug major announced the commercial operation of additional capacity of captive renewable energy power plant in Maharashtra & Karnataka. In Jan'21, Cipla had commissioned 30 MWp solar project at Tuljapur, and now further added 16 MWp of solar capacity for supplying the renewable energy for its manufacturing units/ facilities in Maharashtra. In Karnataka wind solar hybrid captive power plant with capacity as 9 MWp solar +2.7 MVA of wind has been commissioned in partnership with CleanMax Enviro Energy Solution

Balaji Amines gained 1.74% after the company said that board of its material subsidiary, Balaji Speciality Chemicals (BSCL), approved raising funds through an initial public offering (IPO). The IPO will include fresh issue of equity shares aggregating upto Rs 250 crore and/or an offer of sale of equity shares by certain existing and eligible shareholders of the company.

Global Markets:

The Dow Jones futures were up 115 points, indicating a positive opening in the US stock market today.

Most of the European shares advanced on Thursday as traders continued to assess new data on inflation and economic activity. The U.K.'s FTSE 100 was closed on Thursday and Friday for the Queen's Platinum Jubilee celebrations.

Investors are still digesting euro zone inflation numbers which hit an annual 8.1% in May, exceeding expectations and marking a seventh consecutive record high. Investors are closely watching the European Central Bank for hints at the pace and scale of interest rate hikes required to rein in consumer prices.

Russia's onslaught in Ukraine is also front and center, as well as the recent EU announcement of a partial ban for Russian oil imports. OPEC and non-OPEC oil producers, which include Russia, will meet Thursday for a regular policy meeting.

Meanwhile, most markets in Asia declined on Thursday, amid worries over high inflation and the threat of recession.

US stocks started June with declines amid choppy trading. The Dow shed 176.89 points, or 0.54%. The S&P 500 fell 0.75%, and the Nasdaq Composite retreated 0.72%.

The number of April job openings, released Wednesday, declined sharply from the previous month but the findings suggest the job market remains tight. Further, the Institute for Supply Management said its manufacturing PMI came in at 56.1 for May, up from 55.4 the month before.

In the commodities market, Brent crude for August 2022 settlement was down $2.76 or 2.37% at $113.53 a barrel. The losses came after the media reported Saudi Arabia is ready to pump more oil if Russian output declines.

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