Domestic benchmark indices closed with robust gains on Monday. The Nifty ended near the 14,800 mark. Value buying emerged after India's GDP returned to positive territory after contracting for two straight quarters. Barring the Nifty PSU Bank index, all the sectoral indices on the NSE ended in the green.
Global stocks rallied on stabilizing US Treasury yields, hope surrounding global COVID-19 vaccination programmes and the passing of $1.9 trillion US stimulus package.
The barometer index, the S&P BSE Sensex, surged 749.85 points or 1.53% at 49,849.84. The Nifty 50 index advanced 232.40 points or 1.60% at 14,761.55.
Kotak Mahindra Bank (up 3.53%), HDFC (up 2.69%), ICICI Bank (up 1.77%), HDFC Bank (up 1.59%) and Infosys (up 1.31%) were major index movers.
In the broader market, the BSE Mid-Cap index rose 1.46% and the BSE Small-Cap index gained 1.61%.
There were more buyers than sellers. On the BSE, 1,948 shares rose and 1,121 shares fell. A total of 198 shares were unchanged.
COVID-19 Update:
Total COVID-19 confirmed cases worldwide stood at 1,14,078,673 with 25,30,723 deaths. India reported 1,68,627 active cases of COVID-19 infection and 1,57,157 deaths while 1,07,86,457 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.
In India, the nationwide COVID-19 vaccination phase to cover senior citizens and people above 45 years with co-morbidities began from Monday. The vaccine will be administered free of cost at ten thousand government hospitals to these groups while the cost of the vaccine at around 20 thousand private Vaccination Centres will be borne by the people. Private hospitals can charge up to Rs 250 per dose of COVID-19 vaccine during the vaccination drive.
Economy:
The seasonally adjusted IHS Markit India Manufacturing Purchasing Managers' Index (PMI) stood at 57.5 in February 2021, highlighting a strong improvement in operating conditions that was broadly similar to that recorded in January (57.7). The headline figure remained above its long-run average of 53.6.
India's economy returned to growth in its fiscal third quarter after a recession earlier in 2020. India's gross domestic product (GDP) grew 0.4% in October-December compared with the same period a year earlier, data released by the National Statistics Office on Friday showed. That compared with revised contractions of 7.3% in July-September and 24.4% in April-June.
The output of eight core infrastructure sectors grew marginally by 0.1% in January, mainly due to growth in the production of fertiliser, steel and electricity. The core sectors had expanded by 2.2% in January 2020, according to the provisional data released by the Commerce and Industry Ministry on Friday.
The Central government's fiscal deficit soared to Rs 12.34 lakh crore or 66.8% of the revised Budget estimates at the end of January 2021 of the current fiscal. The fiscal deficit at the end of January 2021 in the previous financial year was 128.5% of the Revised Estimates (RE).
Meanwhile, the country's foreign exchange reserves increased by $169 million to $583.865 billion in the week ended 19 February 2021, as per the data released by RBI. In the previous week ended 12 February 2021, the reserves had declined by $249 million to $583.697 billion. It had touched a record high of $590.185 billion in the week ended 29 January 2021 this year.
Numbers to Watch:
The yield on 10-year benchmark federal paper fell to 6.21% as compared with 6.229% at close in the previous trading session.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 73.55, compared with its close of 73.4775 during the previous trading session.
In the commodities market, Brent crude for May 2021 settlement rose 83 cents at $65.25 a barrel. The contract fell $1.69, or 2.56% to settle at $64.42 a barrel in the previous trading session.
Foreign Markets:
Shares in Europe and Asia advanced on Monday amid stabilising US Treasury yields. Stocks had been under pressure over the last few weeks as rising US Treasury yields made equities look less attractive to investors.
The yields jumped on expectations of higher inflation due to a big stimulus package to revive the economy. US Treasury bonds are considered safer and hence their higher yields tend to dissuade global investors from putting money in risk assets such as equities.
Further, progress in the US stimulus package also lent some support to investor sentiments globally.
A private survey released Monday showed China's manufacturing activity in February growing at a slower pace. The Caixin/Markit manufacturing Purchasing Managers' Index (PMI) came in at 50.9, a decline from January's reading of 51.5.
China's official manufacturing Purchasing Managers' Index (PMI) for February came in at 50.6 over the weekend, according to data released by the country's National Bureau of Statistics. That was lower than January's reading of 51.3 but still above the 50 level that separates expansion from contraction.
US stocks ended on a mixed note on Friday. The Dow Jones Industrial Average tumbled 469.64 points, or 1.5%, to finish at 30,932.37, after touching a session low at 30,911.37 as Wall Street struggled to shake off fears of rapidly rising rates.
The S&P 500 lost 18.19 points, 0.5%, to close at 3,811.15 as energy and financial stocks pulled back. The Nasdaq Composite Index added 72.91 points, or 0.6%, to 13,192.34 as Big Tech names rebounded after a large sell-off in the previous session. Facebook, Microsoft and Amazon each rose more than 1%.
The House passed a $1.9 trillion COVID relief bill, the American Rescue Plan Act of 2021, early Saturday. The Senate will now consider the legislation.
Trade data showed that the U.S. trade deficit in goods widened to $83.7 billion in January from a revised $83.2 billion in the prior month, the Commerce Department said Friday. Imports of goods, such as consumer electronics, rose 1.1% to $218.9 billion in January. Goods imports were up 8.2% compared with a year earlier. Exports rose 1.4% to $135.2 billion, but were down 0.7% compared with one year ago.
Auto Sales in February:
The Nifty Auto index rose 2.38% to 10,411.80. The index tumbled 3.12% in the previous session.
Bajaj Auto added 0.32% after the company's total auto sales rose 6% to 375,017 units in February 2021 over February 2020. Sequentially, the company's total sales have decreased 11.8% in February 2021 from 425,199 units sold in January 2021.
Eicher Motors added 2.42% after VE Commercial Vehicles, the company's unlisted subsidiary, recorded 19% growth in total auto sales to 5457 units in February 2021 from 4586 February 2020.
Maruti Suzuki India rose 2.10% after the car major's total sales jumped 11.8% to 1,64,469 units in February 2021 over February 2020. Sequentially, the company's total auto sales rose 2.31% in February 2021 as against 1,60,752 units sold in January 2021.
Escorts lost 1.58%. The company's Agri Machinery Segment (EAM) in February 2021 sold 11,230 tractors, its highest ever February sales, and registered a growth of 30.6% over February 2020. Sequentially, the company's tractor sales have increased by 24.5% from 9,021 units sold in January 2021.
Mahindra & Mahindra (M&M) added 1.77% after the company said its total tractor sales (domestic + exports) during February 2021 were at 28,146 units, up by 25% from 22,561 units for the same month last year. M&M's total auto sales decline by 11.4% to 28,777 vehicles in February 2021 from 32,476 in February 2020. Sequentially, the company's auto sales have decreased 26.5% in February 2021 from 39,149 units sold in January 2021.
TVS Motor jumped 3.64% after the company's total auto sales grew by 18% registering 297,747 units in February 2021 as against 253,261 units in the month of February 2020.
Ashok Leyland rose 0.58%. The commercial vehicles maker's total sales jumped 19% to 13,703 units in February 2021 as against 11,475 units sold in February 2020. Sequentially, the company's total auto sales advanced 4.4% last month from 13,126 units sold in January 2021.
SML Isuzu gained 1.61%. The automobile company's total sales dropped 13.5% to 760 units in February 2021 as against 879 units in February 2020. Sequentially, the company's auto sales soared 42.05% in February 2021 as against 535 units sold in January 2021.
Stocks in Spotlight:
Shares of Bharti Airtel and Vodafone Idea declined 4.45% and 2.29% respectively after telecom major Reliance Jio announced Jio Phone 2021 offer which provides for a new phone along with three new plans.
Jio Phone 2021 offer has a two-year plan, a one-year plan, and a special plan for existing users. These offer free calling for two years and 2GB data/month for Rs 1,999. Those opting for the one-year plan will have to shell out Rs 1,499, while existing JioPhone users can pay Rs 749 for 12 months. Reliance Jio is a wholly owned subsidiary of Index major Reliance Industries (RIL).
Meanwhile, RIL rose 0.83% to Rs 2101.15. RIL said that its wholly owned subsidiary Reliance Strategic Business Ventures (RSBVL) has acquired additional equity stake in its investee company skyTran Inc. for a consideration of $26.76 million. After the acquisition, RSBVL's shareholding in skyTran increased to 54.46% on a fully diluted basis.
US-based skyTran has developed breakthrough passive magnetic levitation & propulsion technology for implementing personal transportation systems aimed at solving the problem of traffic congestion globally. The technology has been developed by skyTran to create smart mobility solutions.
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