Benchmarks hit day's high; Europe trades lower

·5-min read

Key equity barometers extended gains and hit fresh intraday high in afternoon trade. While banks and auto shares advanced, IT shares lagged.

At 13:25 IST, the barometer index, the S&P BSE Sensex, was up 226.48 points or 0.56% at 40,371.98. The Nifty 50 index gained 81.85 points or 0.70% at 11,849.60.

The Nifty's 10-day simple moving average stands at 11,855.64, which could act as a resistance in near term.

The sentiment was upbeat following the media reports that PM Modi and Union Finance Minister Nirmala Sitharaman will meet at 6:30 pm today to discuss the economic situation in the country. The meeting will also discuss likely steps for stimulus.

Shree Cement (up 5.82%), Nestle India (up 4.82%), Asian Paint (up 4.85%), Bajaj Finance (up 3.48%) and Divi's Laboratories (up 2.88%) were the top Nifty gainers.

Wipro (down 2.53%), Infosys (down 2.52%), TCS (down 1.73%), ONGC (down 1.47%) and HDFC (down 1.06%) were the major Nifty losers.

The broader market traded higher. The S&P BSE Mid-Cap index rose 1.17% while the S&P BSE Small-Cap index gained 0.43%.

The market breadth was negative. On the BSE, 1159 shares rose and 1321 shares fell. A total of 160 shares were unchanged.

COVID-19 Update:

Union Government today said that the country's COVID-19 recovery rate has crossed 90.62%. More than 63 thousand COVID patients recovered during the last 24 hours. Health Ministry said the total number of recoveries has gone up to over 72 lakh.

India reported 625,857 active cases of COVID-19 infection and 119,502 deaths while 7,201,070 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.

Total COVID-19 confirmed cases worldwide stood at 4,34,83,973 with 11,58,883 deaths, according to data from Johns Hopkins University.

MSCI Rebalancing:

Morgan Stanley Capital Investment (MSCI) announced that it will implement changes in Foreign Ownership Limits (FOL) in the MSCI Global Indexes containing Indian securities coinciding with the November 2020 Semi Annual Index Review. The global index major said it will implement the changes at the close of 30 November, effective 1 December 2020. The change is expected to attract billions of dollars in active and passive flows for domestic stocks where the FOL will increase.

Stocks in Spotlight:

Bharti Airtel (down 1%) and Tata Motors (up 1.20%) will announce Q2 results today.

Reliance Industries shed 0.61% to Rs 2016.35. The scrip slipped 1.14% to hit the day's low at Rs 2005.55 in trade today.

Kotak Mahindra Bank surged 11.04% to Rs 1572. The media reported that Kotak Mahindra Bank could be included into MSCI indices, leading to major inflows through passive funds. The current constituents of the indices will also see an increase in weight in November 2020 revision of indices by MSCI.

Meanwhile, the private lender's net profit soared 26.7% to Rs 2,184.48 crore on 3.78% increase in total income to Rs 8,288.08 crore in Q2 September 2020 over Q2 September 2019.

Mahindra & Mahindra Financial Services fell 3.40% to Rs 126.40. The NBFC reported 34.4% jump in consolidated net profit to Rs 351.35 crore on 4.2% rise in total income to Rs 3070.50 crore in Q2 FY21 over Q2 FY20.

The gross stage 3 levels stood at 7.0% as at 30 September 2020, against 7.9% as at corresponding reporting date last year. The net stage 3 levels stood at 4.7% as at 30 September 2020, against 6.4% as at corresponding reporting date last year. The stage 3 provisioning coverage ratio stood at 35.1% as at 30 September 2020, against 19.5% as at corresponding reporting date last year.

Mahindra Finance's standalone Assets Under Management (AUM) stood at Rs 81,682 crores as on 30 September 2020, as against Rs 72,732 crore as on the corresponding reporting date last year, registering a growth of 12%.

Global Markets:

Shares in Europe and Asia declined on Tuesday as soaring global coronavirus cases and shrinking hopes for a U.S. stimulus deal took a toll on Wall Street.

According to media reports, new record rises in daily Covid-19 cases have been seen in the U.S., Russia and France in recent days, while the U.K. is set to extend its highest category alert to more cities and German Chancellor Angela Merkel has warned colleagues that Germany is on the verge of losing control of the virus.

Meanwhile, the U.K. has reportedly warned that time is running out as the European Union's top negotiator Michel Barnier travels to London to continue Brexit talks, with the two sides differing strongly on key issues in their bid to secure a new trading arrangement by year-end.

In Asia, profits at China's industrial firms jumped 10.1% year-on-year in September, according to the country's National Bureau of Statistics. Further, China will reportedly impose sanctions on US entities participating in US arms sales to Taiwan. Lockheed Martin, Boeing Defense and Raytheon will be sanctioned.

US stocks tumbled on Monday as soaring coronavirus cases and uncertainty about a fiscal relief bill in Washington dimmed the outlook for the U.S. economic recovery.

Optimism also dimmed over the White House and Republicans striking a stimulus deal with Democrats before the election. White House economic advisor Larry Kudlow reportedly said that talks had slowed down, but noted they are still ongoing.