Post Session: Quick Review

Indian equity benchmarks ended volatile day on a positive note on Thursday. After a cautious start of the day, markets remained volatile for the most part of the session, with the 'Quarterly Statistics on Deposits and Credit of Scheduled Commercial Banks (SCBs), September 2020' - released by the Reserve Bank of India (RBI) has indicated that bank credit growth decelerated to 5.8 percent in Q2 (July- September) of FY21 from 8.9 percent in the year-ago period. It also said aggregate deposits of banks rose 11 percent year-on-year in the July-September period as compared to 10.1 percent growth a year ago. Traders took a note of report that the Finance Ministry has asked ministries and departments to restrict their expenditure for the remaining months of the current fiscal as per the Revised Estimates (RE) target, amid moderating revenues due to the COVID-19 crisis.

But, key indices gained traction in the last hour of the trade to end with strong gains, after IT industry body Nasscom said that Indian tech start-ups are witnessing a gradual recovery with revenue acceleration and funding improving their cash availability and giving them longer runway to operate. Nasscom had conducted a 'Start-up Pulse Survey II' to understand what has changed and what the next six months look like for the tech start-up ecosystem in the country. The first survey was conducted in April–May this year. Besides, RBI Governor Shaktikanta Das stated that after seeing a sharp GDP contraction in the first quarter, the Indian economy has exhibited a stronger than expected momentum in activity. However, he added that even as growth outlook has improved, downside risks remain with respect to the surge in Covid infections and thus the situation needs to be watched carefully.

On the global front, European markets were trading mostly in green as a global equity market rally takes a breather. Asian markets ended mostly higher on Thursday, after the Bank of Korea retained its interest rate at a record low and lifted its growth outlook as exports are set to improve gradually with global recovery, and investment maintains its growth. The Monetary Policy Board of the Bank of Korea, on Thursday, decided to hold its key policy rate at 0.50 percent, as widely expected. The bank projected the economy to contract 1.1 percent this year instead of 1.3 percent decline estimated previously. The outlook for next year was revised up to 3 percent from 2.8 percent.

The BSE Sensex ended at 44259.74, up by 431.64 points or 0.98% after trading in a range of 43582.40 and 44361.78. There were 25 stocks advancing against 5 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.94%, while Small cap index was up by 0.71%. (Provisional)

The top gaining sectoral indices on the BSE were Metal up by 4.13%, Basic Materials up by 2.18%, Telecom up by 1.26%, Healthcare up by 1.19% and Bankex up by 1.16%, while Oil & Gas down by 0.23% was the only losing index on BSE. (Provisional)

The top gainers on the Sensex were Tata Steel up by 5.16%, Bajaj Finance up by 2.95%, Bajaj Auto up by 2.60%, HDFC up by 2.20% and HCL Tech. up by 2.16%. On the flip side, Maruti Suzuki down by 0.87%, ONGC down by 0.74%, Indusind Bank down by 0.47%, Tech Mahindra down by 0.45% and Infosys down by 0.23% were the top losers. (Provisional)

Meanwhile, pointing downside risks to growth across the world and also in India, Reserve Bank of India (RBI) Governor Shaktikanta Das has said the country’s economy has recovered stronger than expected from the initial impact of the COVID-19 pandemic, but there is a need to be watchful of demand sustainability after the end of festivities.

Das noted that after witnessing a sharp contraction in the economy by 23.9 per cent in Q1 and a multi-speed normalisation of activity in Q2, the Indian economy has exhibited stronger than expected pick-up in momentum of recovery. He further added that even as growth outlook has improved, downside risks to growth continue due to recent surge in infections in parts of Europe and also in parts of India.

Besides, Das said regulatory reforms have moved the financial markets to the next trajectory amid the pandemic and affirmed RBI's commitment to ensure an orderly conduct in the markets. He also said that India will continue to approach capital account convertibility ‘as a process, rather than as an event’ within a broad macroeconomic framework.

The CNX Nifty ended at 12987.00, up by 128.60 points or 1.00% after trading in a range of 12790.40 and 13018.00. There were 40 stocks advancing against 10 stocks declining on the index. (Provisional)

The top gainers on Nifty were JSW Steel up by 6.19%, Tata Steel up by 5.02%, Grasim Industries up by 4.07%, Hindalco up by 2.89% and Shree Cement up by 2.88%. On the flip side, Eicher Motors down by 1.77%, BPCL down by 1.06%, Maruti Suzuki down by 0.87%, ONGC down by 0.74% and HDFC Life Insurance down by 0.65% were the top losers. (Provisional)

European markets were trading mostly in green, France’s CAC increased 2.71 points or 0.05% to 5,574.00 and Germany’s DAX was up by 2.04 points or 0.02% to 13,291.84. On the flip side, UK’s FTSE 100 was down by 15.69 points or 0.25% to 6,375.40.

Asian markets ended mostly higher on Thursday due to optimism over a third potential vaccine by AstraZeneca and the University of Oxford that was found to be highly effective in preventing Covid-19. Market sentiment was also encouraged by signs that the transition of power in the US to President-elect Joe Biden has begun. Japanese shares climbed as the government maintained its assessment of the economy in November, saying that conditions remain severe due to the novel corona virus but it is showing movements of picking up. Though, surprise uptick in US jobless claims amid fresh Covid-19 lockdowns has restricted some gains. The US Labor Department said 778,000 initial claims were filed in the week ended November 25, more than expected and an increase of 30,000 from the previous week's upwardly revised figure.