Nifty50: 14,146 ▼ -53 (-0.3%)
Sensex: 48,174 ▼ -263 (-0.5%)
The Indian markets took a pause today after a rising streak. The market breadth was negative as 27 of the Nifty50 stocks declined.
Among the sectoral indices, Nifty Metal (+1.2%) and Nifty Realty (+0.7%) were the top gainers, whereas the Nifty IT (-1.3%) and Nifty FMCG (-1.1%) receded the most.
| Top gainers | Today's change |
| Power Grid Corp | ▲ 4.3% |
| Hindalco | ▲ 3.6% |
| GAIL | ▲ 3.5% |
| Top losers | Today's change |
| ITC | ▼ 2.9% |
| Reliance | ▼ 2.6% |
| Axis Bank | ▼ 1.9% |
Here are the top stories of the day.
Tobacco companies feel the heat of new cigarette law
- The government is planning a draft bill that proposes to raise the legal age for buying cigarettes and tobacco products from 18 to 21.
- The bill also proposes measures such as restricting the sale of tobacco products within 100 metres of any educational institution.
- Shares of cigarette makers such as ITC (-2.9%), Godfrey Phillips (-1.2%), and VST Industries (-1.3%) fell today after the news.
Titan’s jewellery business shows growth
- Shares of Titan hit a lifetime high after the company announced that its jewellery business has transitioned from recovery into growth after growing 15% in Q3. The jewellery business (which contributes 80% of revenues) was buoyed by festive demand as well as pent-up demand for wedding jewellery.
- After a 3.2% intraday spike, the stock witnessed profit-booking and closed 0.3% lower. The watches and eye-wear business are also close to achieving full recovery compared to Q3 last year.
Other jewellers also shine
- Shares of jewellery retail chains Tribhovandas Bhimji Zaveri (19.9%) and PC Jewellers (9.9%) gained supported by strong volumes. It seems investors are taking a cue from the growth in Titan’s jewellery business.
- Further, gold and silver prices are seeing an uptick for the last two months. Rising bullion prices help jewellers to a certain extent as buyers tend to advance their purchases in anticipation of further rise in prices.
Aviation demand remains clouded
- Recovery in demand for air travel is expected to remain uncertain in 2021, as per aviation consulting firm CAPA India. The firm expects consolidation between players in the near-to-medium term.
- Shares of Indigo (+0.7%) and Spicejet (-0.6%) showed mixed reactions.
Closing bell
The services PMI eased for the second consecutive month but the reading above 50 suggested expansion in business activity. The Indian markets have risen for 9 straight weeks and have delivered gains of nearly 25% in Q3, the highest quarterly gains in the past 10 years. Further, after rallying for 10 sessions, the markets took a pause today. Investors will watch out for three things over the next month: Q3 results, the Union Budget (expected on 1 February) and the RBI monetary policy (3-5 February).
Good to know
What is a share buyback?
A company purchasing its own shares from existing investors is called a share buyback. A buyback allows a company to reduce the available shares in the market, thus raising its earnings per share.
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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.