Market recap for 5 February 2021

Nifty50: 14,924 ▲ 28 (+0.1%)

Sensex: 50,731 ▲ 117 (+0.2%)

After a gap-up opening, the Nifty50 breached the 15,000 mark, but subsequently lost some of its steam. The benchmark index remained volatile throughout the day and witnessed 27 of its constituents close in the red. 

Among the Nifty sectoral indices, the PSU Bank (+3.6%) remained the strongest from the start and was followed by Pharma (+1.6%), while Media (-4.4%) and Auto (-1.3%) were the top losers today.

Here are the top stories of the day. 

After a gap-up opening, the Nifty50 breached the 15,000 mark, but subsequently lost some of its steam. The benchmark index remained volatile throughout the day, and witnessed 27 of its constituents close in the red. 

Among the Nifty sectoral indices, the PSU Bank (+3.6%) remained the strongest from the start and was followed by Pharma (+1.6%), while Media (-4.4%) and Auto (-1.3%) were the top losers today.

M&M’s Q3 profits below expectations

• The automotive major reported a 40% YoY rise in net profit, which stood at ₹531 crore. However, profits were well below forecasts of ₹1,461 crore on account of impairment of assets of subsidiaries. Meanwhile, its revenue rose 16% to ₹14,057 crore. 
• The growth was supported by a nearly 20% rise in its tractor sales due to strong rural demand. The company is optimistic and expects demand to continue. The stock closed nearly flat today.

Bajaj Electricals’ Q3 performance boosts stock

• Shares of Bajaj Electricals hit its 20% upper circuit today and made a new lifetime high. The company is witnessing a strong improvement in its performance supported by its consumer products division.
• For Q3, its consolidated net profits zoomed to ₹98 crore compared to ₹9 crore last year.  Revenues showed a rise of 17% YoY to ₹1,500 crore. The revenues in the consumer products division grew 34%

PSP Projects soars on big-ticket order wins

• The Ahmedabad-based construction company said that it has won the order for a private project worth ₹588 crore in Ahmedabad and another institutional project worth ₹236 crore in Gujarat. 
• Further, PSP Projects also claims to have emerged as the lowest bidder for another ₹1,249 crore project to construct medical colleges at multiple locations in Uttar Pradesh. The stock surged 7.2% and has risen about 14% this week.

Stovekraft lists at a premium

• The Bengaluru-based kitchen appliance maker’s stock debuted on the NSE at ₹498, nearly 30% above its issue price. However, it closed with a gain of 14% to its issue price on account of profit booking after a flying start. 
• The public issue comprised a ₹95 crore fresh issue and an offer for sale of 82.50 lakh equity shares and oversubscribed 18 times.

Closing bell

Between the Union Budget and the RBI’s monetary policy outcome, the week witnessed the Nifty50 gain 9.5%. The RBI has kept the rates unchanged at 4% for the fourth straight meet since May. Its accommodative stance is expected to help the economy gain firm traction. Further, the country’s central bank projects FY22 GDP at 10.5% and CPI inflation at 5.2% in Q4FY21. Meanwhile, most major global equity markets are up today, indicating positive cues.

Good to know

What is price discovery?
It is the process of determining the price of an asset in any marketplace through the transactions between buyers and sellers. Based on the information available to them, both buyers and sellers quote the price at which they are ready to transact. When their price matches, a trade takes place and price is discovered. This process happens on a continuous basis right from the time the market opens till the last trade of the day.

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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.