Market Recap for 26 May 2021

Nifty50: 15,301 ▲ +93 (+0.6%)
Sensex: 51,017 ▲ +379 (+0.7%)

After some mild weakness seen in the first hour of trade, the markets witnessed buying interest all day. The market breadth in the Nifty50 was positive, with 31 of the benchmark index closing in the green. 

The Nifty Realty (+2.8%) and Nifty Media (+1.8%) were the top gainers among the sectoral indices today. Meanwhile, stocks in the Nifty Metal (-1.8% ) and Nifty PSU Bank (-0.2%) witnessed selling.

Here are the top stories of the day.

Bayer CropScience posts strong Q4 

• Strong demand for crop-protection products and new product launches helped the agri-sciences company double its Q4 net profit to ₹62 crore. During the same period, revenue from operations rose 60% rise ₹733 crore
• The revenue growth was partially offset by lower corn seed volumes due to weak corn prices. The stock closed 0.8% higher today and has been moving sideways since the beginning of 2021.

Thermax posts multifold profit growth 

• A higher topline, cost reduction measures and better margins in the energy segment allowed Thermax to nearly triple its net Q4 profit to ₹107 crore. 
• Revenue from its key verticals, namely energy, chemical and environment grew in double digits, with the latter jumping over 50%. This translated into a 19% growth in revenue from operations, which stood at ₹1,575 crore. Shares of the Pune-based energy company rose nearly 9% intraday today and closed 3.2% higher. The stock has been range-bound so far this month.

Ajmera Realty triples its Q4 profit 

• In the March quarter, the Mumbai-based realty company witnessed a 16% YoY decline in its consolidated revenue from operations. However, due to lower material costs and cost controls profit more than tripled to ₹12.4 crore.
• For FY21, the company’s sales rose by about 80% YoY to ₹615 crore. The growth was supported by stamp-duty concessions and record low housing loan interest rates. The company also reduced its total debt by about 27%.The stock jumped over 8% intraday to hit its 52-week high of ₹157. The shares have gained nearly 39% so far this month.

Gold gains back some shine

• With the recent bounce-back in prices, gold has recovered its losses in 2021. The rally in the yellow metal comes in the light of a weakening dollar and lower treasury bond yields. Worries around inflation have also boosted demand since gold is often considered a safeguard against inflation. 
• The metal has risen about 13% since its recent low in March 2021, breaching the $1,900 mark. MCX gold prices have risen around 5% so far this month.

Closing bell

While the benchmark indices continue their steady upward march, traders must also pay heed to the India VIX, which spiked over 10% today. It indicates that volatility could rise in the weeks ahead. Tomorrow is the monthly derivative expiry, and markets may witness a sharp movement. Further, a host of data releases are expected next week, including the Q4 GDP numbers, manufacturing and services PMI, and finally the RBI’s interest rate decision. All these have the potential to trigger movements in the markets.

Good to know

What is revenge spending?
During the pandemic, people who did not lose their jobs managed to significantly save on their expenses, due to a lack of spending opportunities. Spending on shopping, dining, travel and entertainment came to a halt. Revenge spending refers to the money one plans to spend to make up for this lost time. The idea is to go on a spending spree because one feels deprived of an entire year-worth of spending and experiences. It is believed that as economies around the world reopen, consumer spending—particularly on leisure and travel—will witness a strong surge.

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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.