Market recap for 3 February 2021

Nifty50: 14,789 ▲ 142 (+0.9%)

 Sensex: 50,255 ▲ 458 (+0.9%)

The post-budget rally extended into the third day and witnessed the Sensex close well above the 50,000 mark for the first time ever. The Nifty50, too, closed at a lifetime high, with 40 of its constituents closing in the green. 

Among the Nifty sectoral indices, Pharma (+2.7%) and PSU Bank (+2.6%) gained the most, while the Realty (-0.4%) and FMCG (-0.1%) indices were the top losers.  

Here are the top stories of the day. 

Jubilant Foodworks’ Q3 profit up on business recovery

• The company, which operates Domino’s Pizza restaurants in India, posted a consolidated profit of ₹123 crore in Q3. Its profit rose by about 22% YoY, while revenue from operations remained nearly flat at ₹1,069 crore.
• The rise in profits is a result of a recovery in business and strong improvement in margins. Further, Domino’s delivery and take-away channels both witnessed rapid growth. Nonetheless, the stock closed 1.6% lower today. 

Bajaj Consumer Care surges on Q3 profits

• The FMCG player posted an 18% YoY rise in Q3 consolidated net profits at ₹57 crore, and similar growth in net sales to ₹243 crore. The company’s modern trade and institutional business together grew 25% YoY. Its e-commerce segment witnessed 3x growth, albeit on a smaller base and now contributes nearly 2.5% of total sales. 
• Meanwhile, the company also declared an interim dividend of ₹6 per share, with the record date set as 12 February 2021. The stock surged 20% and hit its upper circuit today. 

Glenmark secures USFDA approval for seizure drug

• The pharma major said it has received final approval from the US health regulator for its seizure-treatment drug Topiramate. The drug is a generic version of Qudexy XR capsules sold in the US, which had annual sales of approximately $120 million in 2020.
• The company currently has 169 products that are authorised for distribution in the US market. The stock closed 2.8% higher today.

Services PMI expands in January

• India’s purchasing managers’ index (PMI) for services rose to 52.8 in January from 52.3 in the previous month, indicating a pick up in the services activity. 
• It is widely believed that the roll-out of the vaccine would support the demand growth in the economy. Going forward, the rising services inflation triggered by the pent-up demand could be an area of concern.

Closing bell

The Indian markets have rallied 8.5% so far this week. The rally is sharper than the rise seen in other major global equity markets. Of course, much of it is thanks to the Union Budget, which was well-received by most sections of the market. The next event to watch out for is the RBI’s interest rate decision on Friday. However, there are no major upcoming domestic events after that, and the Indian markets could then look to global markets for directional cues.

Good to know

What is a candlestick chart?
A candlestick chart is a financial chart that tracks the movement of securities. It derives its name from the rectangular shape and lines on either end that gives it the appearance of a candle with wicks. A candlestick usually represents the movement in a stock’s price in a day. Over a period of time, the candlesticks can be grouped into patterns that investors can use to make trading decisions.

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Investment in securities markets are subject to market risks; please read all the related documents carefully before investing. The securities quoted are exemplary and are not recommendatory. Past performance is not indicative of future results. Details provided in the above newsletter are for educational purposes and should not be construed as investment advice by RKSV group. Investors should consult their investment advisor before making any investment decision.