Barometers turn rangebound, metal stocks advance

December 01,2022

The benchmark indices traded in a narrow range with modest gains in mid-morning trade. Positive global cues boosted the investors sentiment. The Nifty hovered above the 18,800 level. Metal shares extended gains for the third consecutive trading session. Trading is expected to be volatile due to expiry of weekly index options on the NSE.

At 11:28 IST, the barometer index, the S&P BSE Sensex, was up 280.05 points or 0.44% to 63,379.70. The Nifty 50 index gained 78.25 points or 0.42% to 18,836.60.

The two benchmarks hit all-time highs in early trade today at 18,887.60 for Nifty 50 index and 63,583.07 for Sensex. Further, the Nifty Bank index also registered its fresh record high today at 43,515.05.

In the broader market, the S&P BSE Mid-Cap index added 0.49% while the S&P BSE Small-Cap index rose 0.95%.

The market breadth was strong. On the BSE, 2,190 shares rose and 1,116 shares fell. A total of 167 shares were unchanged.

Investors cheered after the Federal Reserve Chair Jerome Powell indicated that the US central bank plans to slow its aggressive pace of interest rate hikes as soon as next month. Powell suggested that the US central bank is preparing to raise its benchmark rate by 0.5% points when its monetary policy committee gathers in December, after a string of 0.75-points increase.

Economy:

Indian economy recorded 6.3% annual growth rate in July-September after double-digit surge in the previous quarter. Ministry of Statistics and Programme Implementation (MoSPI) released India's economic growth data for the second quarter of the current financial year (FY23). India's gross domestic product or GDP grew by 6.3% in Q2 on a year-on-year basis. In other words, it was 6.3% more than the GDP in the same months in 2021. MoSPI also reported that India's Gross Value Added (or GVA) in Q2 grew by. 5.6% on a year on year basis.

Meanwhile, India's eight core sectors' output growth almost turned flat in October, coming at just 0.1% from 7.8% in September, with cement and refinery products slipping into contraction. The Index of Core Industries released by the Commerce and Industry Ministry, which constitutes about 40% of the Index of Industrial Production (IIP), was unchanged month-on-month at 138.

IPO Update:

The initial public offer (IPO) of Uniparts India received bids for 85,42,625 shares as against 1,01,37,360 shares on offer, according to stock exchange data at 11:27 IST on Thursday (1 December 2022). The issue was subscribed 84%.

The issue opened for bidding on Wednesday (30 November 2022) and it will close on Friday (2 December 2022). The price band of the IPO is fixed at Rs 548-577 per share. An investor can bid for a minimum of 25 equity shares and in multiples thereof.

Buzzing Index:

The Nifty Metal index rose 1% to 6,630, extending gains for the third session. The index rallied 3.9% in three trading sessions.

Hindalco Industries (up 2.91%), National Aluminium Company (up 1.69%), Hindustan Copper (up 1.62%), Jindal Steel & Power (up 1.57%), APL Apollo Tubes (up 1.42%), Jindal Stainless (up 1.32%), Tata Steel (up 1.21%), Vedanta (up 1.15%), MOIL (up 0.62%) and JSW Steel (up 0.38%) edged higher.

Stocks in Spotlight:

Piramal Enterprises advanced 4.05% after the company's board of directors approved the issuance of market linked non-convertible debentures (NCDs) aggregating up to Rs 250 crore, on private placement basis. The size of the issue is up to Rs 50 crore along with an option to retain over subscription of up to Rs 200 crore, aggregating up to Rs 250 crore. These secured, rated, listed, redeemable, principal protected, market linked non-convertible debentures are to be redeemed at par on 24 May 2024.

Hatsun Agro Product jumped 9.51% after the company said a special committee of the board will decide terms of rights share issue on 3 December 2022.

Tamilnad Mercantile Bank rallied 4.49% after the bank announced that it has been authorized by the Reserve Bank of India (RBI) to undertake government business on behalf of RBI. An agreement in this regard has been executed by the bank with RBI for appointing the bank as an agency bank of RBI for undertaking Government Agency Business.

Global Markets:

Asian stocks edged higher, carrying on the optimism behind Wall Street's rally as Federal Reserve Chair Jerome Powell confirmed smaller rate hikes could start in December.

The Caixin/Markit Manufacturing Purchasing Managers' Index for China came in at 49.4, higher than expectations. The reading marks a fourth consecutive month of contraction, after a reading of 49.2 from October and dipping to 48.1 in September.

South Korea's revised gross domestic product for the third quarter confirmed growth of 3.1% compared to the same period a year ago - higher than a 2.9% expansion seen in the second quarter. The economy saw slower quarterly growth of 0.3% in the third quarter, following a growth of 0.7% in the previous period.

Wall Street ended sharply higher on Wednesday after Federal Reserve Chair Jerome Powell said the central bank might scale back the pace of its interest rate hikes as soon as December.

Federal Reserve Chair Jerome Powell on Wednesday said it was time to slow the pace of coming interest rate hikes while also signaling a protracted economic adjustment to a world where borrowing costs will remain high, inflation comes down slowly and the United States remains chronically short of workers.

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