Market pares gains; HDFC twins drag

·5-min read

Key benchmarks pared gains in the afternoon trade, dragged by HDFC twins. Gains in index heavyweight Reliance Industries (RIL) supported indices. At 13:20 IST, the barometer index, the S&P BSE Sensex jumped 142.15 points or 0.40% at 35,985.85. The Nifty 50 index advanced 41.95 points or 0.40% at 10,593.65.

HDFC (down 0.29%) and HDFC Bank (down 1.24%) declined and put pressure on bourses.

RIL rose 1.23% after the company said Intel Capital will invest Rs 1,894.50 crore in Jio Platforms for a 0.39% equity stake. Intel Capital joins the list of firms who have recently invested in Jio Platforms, taking the total investment amount to Rs 1,17,588.45 crore.

In the broader market, the S&P BSE Mid-Cap index rose 0.69%. The S&P BSE Small-Cap index gained 0.55%. Both these indices outperformed the Sensex.

The market breadth was almost even. On the BSE, 1,295 shares rose and 1,260 shares fell. A total of 133 shares were unchanged. In Nifty 50 index, 32 stocks advanced while 18 stocks declined.

Foreign portfolio investors (FPIs) sold shares worth Rs 556.72 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 908.64 crore in the Indian equity market on 2 July 2020, provisional data showed.

COVID-19 Update:

Total COVID-19 confirmed cases worldwide stood at 1,08,73,186 far with 5,21,337 deaths. India reported 2,27,439 active cases of COVID-19 infection and 18,213 deaths, according to the data from the Ministry of Health and Family Welfare, Government of India.

Gainers & Losers:

Adani Ports & Special Economic Zones (up 4.84%), Tata Motors (up 3.10%), Bharti Airtel (up 2.66%), Eicher Motors (up 2.18%) and PowerGrid Corporation of India (up 2.03%) were top gainers in Nifty 50 index.

Hindalco Industries (down 1.49%), Cipla (down 1.35%), HDFC Bank (down 1.35%), JSW Steel (down 0.85%) and Ultratech Cement Company (down 0.80%) were top losers in Nifty 50 index.

Stocks in Spotlight:

Vedanta fell 0.47%. HDFC Life Insurance Company jumped 5.30%. Vedanta will be replaced by HDFC Life Insurance Company in the Nifty 50 index effective from 31 July 2020.

Hindustan Unilever (HUL) edged higher by 0.92%. The FMCG major announced the next step in the evolution of its skin care portfolio to a more inclusive vision of Positive Beauty, and introduces Glow & Lovely, the new name for the Fair & Lovely brand. Over the next few months, Glow & Lovely will be on the shelves, and future innovations will deliver on this new proposition. The Men's range of Fair & Lovely will be called 'Glow & Handsome'.

Motherson Sumi Systems (MSSL) skid 5.40%. The board of directors of Motherson Sumi Systems approved a group reorganization plan. The reorganization realigns interests of all its stakeholders and creates a simplified corporate structure for growth of businesses across product portfolios within auto components space and allied operations. The reorganization plan approved by the respective boards of MSSL and Samvardhana Motherson International (SAMIL) among other things, entails demerger of Domestic Wiring Harness (DWH) business from MSSL into a new company which is in the process of being incorporated as a wholly owned subsidiary of MSSL (New Co.) and subsequent merger of SAMIL into MSSL to consolidate 100% shareholding in Samvardhana Motherson Automotive Systems Group BV (SMRP BV) as well as to bring all auto component and allied businesses in SAMIL under MSSL.

Affle (India) hit an upper circuit of 5% at Rs 1,523.90 after the advertising & media firm said that it signed a definitive agreement on 2 July 2020 to acquire 8% stake in Singapore's OSLabs for $2.86 million. The acquisition is likely to complete by 25 July 2020. OSLabs ("Indus OS")'s total unaudited consolidated revenue from operations (financial year ended 31 March 2020) was Rs 18.05 crore.

Cadila Healthcare rose 0.10% after the pharmaceutical major said its vaccine for COVID-19 has successfully completed pre-clinical development and received permission to initiate human clinical trials. The drug maker announced before trading hours today, 3 July 2020 that its plasmid DNA vaccine candidate for COVID-19 (ZyCoV-D) developed indigenously at its Vaccine Technology Centre in Ahmedabad (Gujarat) has successfully completed the preclinical phase. It has now received permission from the Drug Controller General of India - Central Drugs Standard Control Organisation (CDSCO) to initiate Phase I/II human clinical trials in India.

Global Markets:

European markets opened higher while Asian stocks continued trading higher on Friday following the overnight gains on Wall Street after a report by the U.S. Labor Department showed another record spike in employment in the month of June 2020.

Meanwhile, China's services sector grew at its fastest pace in over a decade in June 2020 with the Caixin/Markit services Purchasing Manager's Index (PMI) coming in at 58.4 for the month. The 50 level in PMI readings separates growth from contraction on a monthly basis.

The US stock market finished session higher on Thursday, 2 July 2020, with the Nasdaq reached an all-time closing high, as bullish investors took heart from better than expected June 2020 employment report which provided assurance that the U.S. economic recovery was well under way. However, market gains capped amid concerns about rising coronavirus cases.

US nonfarm payrolls surged by 4.8 million jobs in June, thanks to rises in the hard-hit hospitality sectors. A separate report on jobless claims, the most timely data on employment, showed initial claims for state unemployment benefits fell just 55,000 to a seasonally adjusted 1.427 million for the week ended June 27. The number of people receiving benefits after an initial week of aid rose 59,000 to 19.290 million in the week ending Jun. 20.

However, US daily COVID-19 cases topped 50,000 for the first time with increases in major states including Florida, Texas and California. On Thursday, Florida reported a record-shattering 10,000 new cases of the disease.

U.S. financial markets will be closed on Friday to observe the July Fourth holiday which falls on Saturday this year.