Bulls fight back

Nifty50: 17,691 ▲+159 (+0.9%)
Sensex: 59,299 ▲+533 (+0.9%)

The markets snapped their four-day losing streak and closed higher today. The market breadth was positive as 36 Nifty50 stocks posted gains.  

All Nifty indices closed in the green, with Metal (+2.9%) and Media (+2.6%) being the top gainers.    

For more updates on F&O, click here.

Here are the top stories of the day.

Sugar stocks in a sweet spot

On the back of better demand, India's sugar exports rose to an all-time high of 71 lakh tonne- registering a 20% increase from the previous year. 

Further, as per ISMA (Indian Sugar Mills Association), India’s sugar production is expected to remain flat in 2021-22. Meanwhile, the price of sugar in the international market was up by 5% last week as production in Brazil and Thailand continues to linger. Shares of major sugar companies Dalmia sugar (+8.4%), Balrampur chini (+7.1%) and Shree Renuka (+4.8%) saw strong buying interest. 

Divi’s Lab shares soar

Shares of the Hyderabad-based pharma company surged by around 10% intraday, hitting a new life high. This comes after US-based Merck and Ridgeback Biotherapeutics announced that its Molnupiravir drug significantly reduces the chances of hospitalisation for patients with mild to moderate symptoms. 

According to analysts, this is beneficial for Divi’s Lab as it is a manufacturer of Molnupiravir API (active pharmaceutical ingredient). Shares of Divi’s Lab pared some of its early gains and closed around 8% higher.

Aviation fuel prices continue to rise

The prices of aviation turbine fuel (ATF) are up 9% over the past month as the global crude oil prices continue to march upward. Over the last year, oil marketing companies have increased the ATF prices by 80%. 

In the wake of rising ATF prices, experts believe that Indian airlines are likely to report weak financial performance.. ATF accounts for around 30-40% of domestic airlines’ total expenses. However, the increase in passenger capacity and pick up in travel are expected to provide a boost to the revenue. Shares of Indigo and SpiceJet were up 0.7% and 0.2%, respectively. 

Closing bell

While last week seemed like a doom with the Nifty50 falling 1.8%, this week has started with a boom with the index rising nearly 1%. All the sectoral indices closed in green. This bullishness comes ahead of the RBI’s interest rate decision later this week. Today, the Indian markets  largely ignored weak cues from the international indices and also the resumption of uptrend in the US treasury bond yields. Traders must remain nimble-footed and willing to change course during such times when divergent trends emerge.

Good to know

What is net profit margin? 

The net profit margin refers to how much profit a company makes in comparison to its revenue. This financial ratio is represented in terms of the percentage. For instance, if a company’s net profit is ₹10 crore and its revenue is ₹100 crore. The net profit margin of the company would be 10%. An expansion of the net profit margin helps investors to understand whether a company is able to keep its operating and other costs under control. Click here to read the 10 essential parameters that investors must look at while investing in a stock. 

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Investment in securities markets is 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.