Market reverses initial gains

·3-min read

Volatility struck bourses in early trade as the key indices reversed early gains and were currently trading with modest losses. At 9:25 IST, the barometer index, the S&P BSE Sensex, was down 116.18 points or 0.29% at 40,029.32. The Nifty 50 index was down 24.70 points or 0.21% at 11,743.05.

The S&P BSE Mid-Cap index was down 0.38%. The S&P BSE Small-Cap index was off 0.66%.

The market breadth, indicating the overall health of the market, is weak. On the BSE, 512 shares rose and 1091 shares fell. A total of 61 shares were unchanged.

Cues to watch:

The Narendra Modi government is actively working on yet another round of stimulus measures, which could be announced near Diwali, reports indicated. This time, measures could include an infrastructure push with focus on urban projects, sectoral intervention for sectors like hospitality and tourism, and extension of the production-linked incentive scheme to more sectors.

Stocks in news:

NTPC rose 2.1%. A meeting of the board of directors of the company is scheduled on 2 November 2020 to consider and approve proposal for buyback of equity shares of the company.

Torrent Pharmaceuticals dropped 2.27%. The company reported 27.05% rise in consolidated net profit to Rs 310 crore on 0.78% fall in total income to Rs 2,023 crore in Q2 September 2020 over Q2 September 2019.

Mahindra & Mahindra (M&M) Financial Services lost 2.56%. The company reported 34.39% rise in consolidated net profit to Rs 351.35 crore on 4.16% rise in total income to Rs 3,070.50 crore in Q2 September 2020 over Q2 September 2019.

Finolex Industries surged 4.98% after the company reported 20.1% rise in consolidated net profit to Rs 122.83 crore on 4.12% rise in total income to Rs 621.81 crore in Q2 September 2020 over Q2 September 2019.

IRCTC shed 0.59%. Department of Investment and Public Asset Management (DIPAM), Ministry of Finance, Government of India has appointed the Merchant Bankers for a period of three years for disinvestment of paid up equity capital of IRCTC through Offer For Sale (OFS).

IDBI Bank fell 2.07%. A meeting of the board of directors of the bank is scheduled on 29 October 2020 to consider and approve raising of funds through issue of equity shares through qualified institutions placement.

Global Markets:

Overseas, Asian stocks are trading lower as soaring global coronavirus cases and shrinking hopes for a U.S. stimulus deal took a toll on Wall Street. Profits at China's industrial firms jumped 10.1% year-on-year in September, according to the country's National Bureau of Statistics.

China will reportedly impose sanctions on US entities participating in US arms sales to Taiwan. Lockheed Martin, Boeing Defense and Raytheon will be sanctioned.

In 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.

Back home, domestic shares went on a southward spiral on Monday amid a broader selloff. Global cues were weak as fresh COVID concerns and fading hopes for more US fiscal stimulus before the presidential election weighed on the market sentiments. Governments across Europe have tightened restrictions to curb an accelerating second wave of COVID-19 infections. The barometer index, the S&P BSE Sensex slumped 540 points or 1.33% at 40,145.50. The Nifty 50 index fell 162.60 points or 1.36% at 11,767.75.

Foreign portfolio investors (FPIs) sold shares worth Rs 119.42 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 979.16 crore in the Indian equity market on 26 October, provisional data showed.