Running out of steam?

Nifty50: 16,594 ▲ 249 (+1.5%)

Sensex: 55,464 ▲ 817 (+1.5%)

• After a gap-up opening, the markets witnessed some profit booking. 
• Meanwhile, 43 stocks of the Nifty50 pack ended in the green. 
• The assembly election results acted as a sentiment booster. The market is now expected to watch out for inflation data in the US (today) and India (Monday). 

Among the Nifty sectoral indices, FMCG (+3%) and PSU Bank (+2.3%) were the top gainers, while IT (-0.1%) was the sole loser.

For more updates on F&O, click here.

Here are the top stories of the day.

Inventory gains a silver lining for OMCs

Amid higher crude prices, shares of oil marketing companies (OMCs) including Indian Oil, HPCL, and BPCL have fallen between 4% and 11% since mid-February. The much-expected hike in fuel prices has also been delayed. However, gains on increase in value of the inventory of petroleum products held by these companies are expected to provide some relief. 

The current rate of crude oil hovers around $115 per barrel as compared to $76 per barrel during the December quarter. If crude oil prices remain consistent, the inventory value will climb by nearly $40 per barrel, reportedly resulting in a gain of over ₹25,000 crore for the OMCs.

L&T rises after ‘significant’ order wins

Shares of Larsen and Toubro (L&T) shot up nearly 4% intraday as it announced new orders bagged by its construction arm. These orders are valued between ₹1,000 to ₹2,500 crore and are classified as ‘significant’ by the company. 

One of the orders is an EPC contract from Ircon International for the Northeast Frontier Railway. L&T has also secured two other orders—one from a global FMCG manufacturer for the design and construction of a food processing facility in Gujarat, and another for the expansion of a super-specialty hospital in Kolkata. 

Airfares likely to fall

As per industry experts, international airfares are likely to drop upto 40% as carriers increase the number of flights. The government has given a nod to resume international flights from March 27. 

Leading carrier Indigo is expected to resume over 100 international flights in the coming months.  Airfares had increased earlier due to restrictions on the number of flights during the pandemic.

IPO Corner

Market regulator SEBI gave the green signal to the IPO application by LIC.  The approval came nearly three weeks after the filing was done. However, investment bankers hired for the IPO have advised the government to not launch the offer in a hurry, citing adverse market situations. The IPO was initially planned for this month but due to the escalating Russia-Ukraine conflict, it might get delayed. The government is soon expected to take a final decision on the matter. 

Good to know

What is a supply shock?

A supply shock refers to an unexpected event that triggers a sudden rise or fall in the supply of a commodity/product, resulting in a change in its price. It can be negative, resulting in a decreased supply or positive, leading to an increased supply. A negative supply shock causes an increase in the product price while a positive supply shock decreases the price. For example, because of the Russia-Ukraine conflict, supply of crude oil has been affected and the prices have increased.

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