Sensex jumps 514 pts; Nifty reclaims 17,500 mark; Bajaj Finance climbs 5%

September 21,2021

The key equity indices reversed early losses and ended with sharp gains on Tuesday. Recovering global cues boosted sentiment. The Nifty closed above the 17,550 mark after hitting the day's low of 17,326.10 in mid-morning trade. Metal and realty shares bounced following a recent selloff.

The barometer index, the S&P BSE Sensex, advanced 514.34 points or 0.88% to 59,005.27. The Nifty 50 index added 165.10 points or 0.95% to 17,562.

Bajaj Finance (up 4.94%), ITC (up 3.36%), Infosys (up 1.77%), HDFC (up 1.10%) and TCS (up 1.09%) were major market movers.

Oil India (up 7.04%) and ONGC (up 5.14%) surged on firm crude oil prices.

The broader indices lagged the benchmarks. The BSE Mid-Cap index rose 0.79% and the BSE Small-Cap index gained 0.14%.

The market breadth was almost even. On the BSE, 1616 shares rose and 1613 shares fell. A total of 172shares were unchanged.

The NSE's VIX index, a gauge of market's expectation of volatility over the near term, dropped 5.55% at 16.52.

COVID-19 Update:

Total COVID-19 confirmed cases worldwide stood at 22,90,83,964 with 47,00,041 deaths. India reported 3,09,575 active cases of COVID-19 infection and 4,45,385 deaths while 3,27,49,574 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.

A total of 81,78,68,213 COVID-19 vaccine doses have been administered in the country so far, with over 96.18 lakh doses being given yesterday, according to the Co-WIN dashboard.

Economy:

The Reserve Bank of India will conduct open market purchase of Government Securities under the G-Sec Acquisition Programme (G-SAP 2.0) for an aggregate amount of Rs 15,000 crore on 23 September 2021. Simultaneously, the bank will also sale government securities under Open Market Operations (OMO) for an aggregate amount of Rs 15,000 crore on the same day.

Numbers to Watch:

The yield on 10-year benchmark federal paper fell to 6.122% as compared with 6.138% 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 73.61, compared with its close of 73.7450 during the previous trading session.

MCX Gold futures for 5 October 2021 settlement rose 0.10% to Rs 46,323.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, fell 0.14% to 93.15.

In the commodities market, Brent crude for November 2021 settlement rose 80 cents at $74.72 a barrel. The contract fell $1.42, or 1.88% to settle at $73.92 a barrel in the previous trading session.

Foreign Markets:

US Dow Jones index futures were up 306 points, indicating a strong opening in the US market today.

European stocks advanced across the board while most Asian stocks ended higher on Tuesday. Markets in mainland China and South Korea were closed on Tuesday for a holiday.

US stocks fell in a broad sell-off on Monday, as fear of contagion from potential collapse of China's Evergrande drove investors out of equities in a flight for safety.

The US Federal Reserve is due to meet on Tuesday and Wednesday as investors look for cues on when it will begin pulling back on its bond purchases. Fed Chair Jerome Powell will hold a press conference Wednesday at the conclusion of the two-day meeting.

Powell had said the so-called tapering could occur this year, but investors are waiting for more specifics, particularly after mixed economic data released since Powell's last comments.

Buzzing Indian Segment:

The Nifty Realty index surged 3.57% to 419.15. The index fell 4.44% in the past two sessions.

Godrej Properties (up 5.29%), Indiabulls Real Estate (up 4.91%), Sunteck Realty (up 2.93%), DLF (up 2.37%), Phoenix Mills (up 1.41%), Oberoi Realty (up 0.36%) and Hemisphere Properties (up 0.15%) advanced.

The Karnataka state assembly, on 20 September 2021, passed an amendment to the Stamp Act, 1957, under which the state has reduced the stamp duty on properties priced between Rs 35 lakhs and Rs 45 lakhs to 3% from the earlier 5%. The reduced rates are applicable only on registrations where the property is changing hands for the first time.

This means buyers in the secondary market, also known as the resale market, will have to pay 5% stamp duty on property purchases, irrespective of their ticket size.

Karnataka-based Brigade Enterprises (up 9.84%), Prestige Estates Projects (up 5.91%), Sobha (up 0.96%) rallied.

Stocks in Spotlight:

Infosys rose 1.77%. The IT major today announced its collaboration with ServiceNow to provide enterprise-level service management for customers in manufacturing industries.

Adani Ports and Special Economic Zone (APSEZ) rose 0.07%. The Competition Commission of India (CCI) approved proposed acquisition of 10.40% equity shareholding of Gangavaram Port by the company.

Kolte-Patil Developers jumped 3.70%. PGIM India Mutual Fund bought 5,00,000 equity shares (or 0.65% stake) of Kolte-Patil at an average price of Rs 314.36 per equity share via bulk deals on the NSE yesterday, 20 September 2021. The total amount invested is Rs 15.71 crore.

Larsen & Toubro added 0.84%. The company's wholly owned subsidiary, L&T Hydrocarbon Engineering received 'significant' order in the construction services segment - one each from GAIL India and Air Products Middle East Industrial Gases. According L&T's classification, the value of the said contracts lies between Rs 1,000 crore to Rs 2,500 crore.

SBI Cards and Payment Services shed 0.11% to Rs 1070.55 after series of bulk deals in early trade.

On the BSE, 15.07 lakh shares were traded on the counter compared with the average daily volume of 2.24 lakh shares in the past two weeks. On the NSE, 3.97 crore shares were traded on the counter compared with the average daily volume of 88.62 lakh shares in the past one quarter.

The media reported that US private equity fund CA Rover Holdings, an affiliate of Carlyle Asia Partners, is selling 3.2 crore shares, or 3.4% stake, in SBI Cards and Payment Services worth $443 million or Rs 3,267 crore through the stock exchange platform on Tuesday. As of 30 June 2021, CA Rover Holdings held a 6.50% stake in the company.

Tata Motors advanced 0.94%. The company on Tuesday announced that it will increase the price of its commercial vehicle range in effect from 1 October 2021. The automobile maker said that the continued rise in the cost of commodities, such as steel and precious metals, necessitates the company to pass on a part of it through increase in price of the products.

HCL Technologies rose 1.85%. The company announced a five-year, digital transformation deal with MKS Instruments Inc., a global provider of instruments, systems, subsystems, and solutions for advanced manufacturing processes, to improve performance, productivity, and speed to market.

Separately, the IT firm said that it has entered a multi-year application services transformation partnership with Lendico, a brand of ING Germany, to deliver application and engineering services to help it create a digital platform that makes business banking faster and more convenient for small- and medium-sized enterprises (SMEs).

Kitex Garments gained 0.77%. The company has signed the memorandum of understanding with Telangana State Government for investing Rs 2,406 crore in the state of Telangana. The investment is planned at Kakatiya Mega Textile Park, Warangal and Industrial Park, Sitarampur.

Primary Market:

Paras Defence and Space Technologies IPO opened for subscription from Tuesday (21 September) and it will close on Thursday (23 September).

The offer comprises of a fresh issue of up to Rs 140.60 crore and an offer for sale of up to 17,24,490 equity shares (including anchor portion of 29,27,485 equity shares) in the price band of Rs 165 to Rs 175 per share.

As on 16:48 IST, the IPO received bids for 11.67 crore shares as against 71.40 lakh shares on offer. The issue was subscribed 16.35 times so far.

The company intends to utilize the net proceeds from the fresh issue towards purchase of machinery and equipment amounting Rs 34.657 crore, funding incremental working capital requirements amounting Rs 60 crore, repayment or prepayment of all or certain borrowings amounting Rs 12 crore and for general corporate purposes. As of 31 July 2021, its aggregate outstanding indebtedness was Rs 115.827 crore.

Paras Defence and Space Technologies is primarily engaged in designing, developing, manufacturing and testing of a wide range of defence and space engineering products and solutions.

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