Market recap for 4 January 2021

Nifty50: 14,132 ▲ 114 (+0.8%)

Sensex: 48,176 ▲ 307 (+0.6%)

The markets extended their rising streak for the ninth day in a row. The market breadth was also positive with 37 of the Nifty50 stocks rising.

Among the sectoral indices, Nifty Metal (+5.0%) and Nifty IT (+2.6%) were the top gainers, whereas the Nifty Bank closed flat.

Here are the top stories of the day.

Marico gains on optimistic outlook

• Marico’s Indian business (accounting for 77% of revenues) saw a double-digit revenue growth in Q3, as per its quarterly update. Its shares rose 2.6% after the company said that it maintains an optimistic outlook for FY21. 
• A recovery in the consumer sentiment, the festive season and a declining Covid graph were the highlights of the quarter. Further, the company was able to introduce price hikes to beat the inflationary pressure seen in raw materials.

Multiplexes rally on capacity hike

• Investors lapped up stocks of multiplex operators such as PVR (+4.4%) and Inox Leisure (+6.3%) after the Tamil Nadu state government increased the seating capacity limit from 50% to 100%. 
• The rise in multiplex shares was backed by strong volumes. The move could also nudge other states to relax restrictions.

Steel stocks upbeat on record volumes

• Jindal Steel and Power (JSPL) sold 7.1 lakh tonnes of steel in December 2020, its highest ever monthly sales. The company recorded a volume growth of over 25% versus December 2019. 
• Shares of JSPL rose by 6.8%. Further, the recent industry-wide price hikes and upbeat analyst expectations for Q3 earnings augur well for steel stocks such as Tata Steel (+8.3%) and SAIL (+6.8%). 

Alkyl Amines soars on stock-split plans

• The speciality chemical company will consider a stock split and an interim dividend during its upcoming board meeting. The company also said it aims to set up new projects, including those for manufacturing amines.
• The stock gained 17.2% today and rallied over 250% in 2020.

Closing bell

The steady manufacturing PMI numbers reinforced the all-round market bullishness. Further, as the Q3 results season starts, the action in stocks of companies that release their numbers early is likely to rub off on other stocks in their sector. This typically creates volatility in those stocks when expectations don’t match the actual results. 

Good to know

What is a stock split?

A stock split occurs when a firm divides the face value of its existing shares into smaller denominations. After a stock is split, its price gets divided in the split ratio, making it more affordable. For example, a stock trading at ₹100 before a two-for-one split, will trade at ₹50 after the split.

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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.