Morning update for 25 November 2020

Indices at 10:00 am

▲ Nifty50 13,116 (+0.47%)  

▲ Sensex 44,724 (+0.45%)

▲ Nifty Midcap 100 19,417 (+0.34%)    

▲ Nifty Smallcap 100 6,412 (+0.50%)

In the news

Dow hits all-time high

• The Dow Jones industrial average crossed 30,000 for the first time as president-elect Biden’s formal transition process begins and as investors expect faster economic recovery with the progress on Covid vaccines. European equity markets too showed bullish trends. 
• BlackRock Inc, the world's largest asset manager, on Monday upgraded US equities to "overweight".  An overweight rating on a stock usually means that it deserves a higher weighting than the benchmark's current weighting for that stock. Similarly, overweight rating on equities means greater exposure compared to other assets.
• Back home, the Nifty50 too crossed 13,000 for the first time. 

Foreign inflows at record high

• So far in November, foreign portfolio investors have invested a record ₹55,552 crore in Indian equities. Similarly, in FY21 there has been a record inflow of ₹154,000 crore till November 24. 
• This comes at a time when the market expects Q2 GDP to contract in the range of 5-10%. Domestic institutional investors have been net sellers in November to the tune of ₹33,518 crore. 

Global airlines losses to continue in 2021

• The International Air Transport Association (IATA) projects that the global aviation industry will lose $118.5 billion this year and a further $38.7 billion in 2021.
• It expects positive effects of the vaccine on air traffic only from mid-2021 and believes industry will turn cash positive in the December quarter of 2021. 
• Meanwhile, US airlines stocks traded higher on increasing air traffic and revival prospects. United Airlines (+9.8%), American Airlines (+9.2%) and Delta (+6.3%) saw significant gains. Domestic airline stocks such as Indigo (-0.1%) and Spicejet (+0.2%) are nearly flat today.

Sectoral indices 

• Today, the Nifty PSU Bank index (+2.7%) and Nifty Media index (+1.8%) are top gainers among the sectoral indices. The so-called defensives are currently trading in negative territory. The Nifty IT (-1.1%), Nifty Pharma (-0.2%) and Nifty FMCG (-0.2%) are all in the red.

Global markets

• US markets continued their upward journey and closed 1.5% higher yesterday. Buoyancy was seen in key Asian markets as well. Japan’s Nikkei 225 extended yesterday’s gains and is up 1.1% today. Hong Kong’s Hang Seng broke from a two-week sideways phase and is up 0.8%. China’s SSE Composite has been in a broad consolidation since July 2020, and is down 0.2% today.

Events today

• Data releases in the US: Q3 GDP, new home sales and initial jobless claims

Fact of the day

In 1976, Apple co-founder Ronald Wayne sold his 10% stake in Apple for $800. It would have been worth $196 billion today!

Source: CNBC

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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.