Tuesday Market Update: Indices extend the green rally

Markets at a Glance:

Upbeat rally in the Global markets, return of President Trump to White House and speculation over U.S. fiscal stimulus talks made bulls to keep the control in Indian markets. Nifty50 rose by 159 points and closed around 11662.4, while Sensex grew by 600 points and closed at 39574.

Talking about sectors, Metal, pharma and FMCG had minor losses, while others were in green with Nifty Financial Services gaining the top spot due to strong rally in HDFC ltd.

Top Gainers/Losers:

Tata Motors, HDFC, Adani Ports, Mahindra & Mahindra and IndusInd Bank gained the most in today’s session, while Britannia Ind, Coal India, Wipro, Hindalco and Tata Steel were among the top losers.

DII/FII Data:

DIIs stick to their strategy of sell-off and divested Rs.934.84 crore, while FII showed their confidence in Indian markets by investing Rs,1101.76 crore.

RBI’s MPC meet will happen from Oct 7 to 9 with its new members:

After its recent unprecedented move to postpone Monetary Policy Committee (MPC) meeting, which decides key interest rates, due to Government’s failure to appoint three external members, RBI will now held the same meeting from tomorrow till Oct 9.

Government has appointed eminent economists Ashima Goyal, Jayanth R Varma and Shashanka Bhide as external members on six-member panel of MPC. They will replace Chetan Ghate, Pami Dua, and Ravindra Dholakia. Their tenure had expired after the previous policy meet on August 6.

MPC, a statutory committee, consist of three members of RBI and three external members appointed by Government. RBI members include present Governor of RBI, Deputy Governor in charge of the Monetary Policy Department and Executive director of the Central Bank in charge of monetary policy.

Services PMI improves to 49.8 for September vs 41.8 in August:

As per the data released by IHS Markit, Service sector’s Purchasing Managers’ Index rose to 49.8 in September month as compared to 41.8 value in August month.

This gives a sign of relief after manufacturing sector’s PMI data released last Thursday showed that India’s manufacturing sector expanded at its fastest pace in over eight years. Manufacturing PMI stood at 56.8 for September month improving from 52.0 of August.

Read more about Purchasing Managers’ Index here

No decision yet over compensation to states in GST council:

GST council on Oct 5 failed to decide over the issue of Rs.2.35 lakh crore shortfall in compensation cess collection this year. Earlier centre has given 2 options to state to recover the GST dues, but opposition ruled states denied both the options and asked centre to borrow from market for paying dues to them.

However, consensus was attained to extend the compensation cess beyond 2022, the five-year period that had been agreed originally. Also, centre will immediately disburse Rs.20000 crore collected in cess fund in current FY to states.

It’s been decided that in the council meeting, from Jan 1, 2021, small businesses with annual turnover of less than Rs.5 crore need not file GST returns monthly, but once every quarter.

Quick Bytes:

        Sobha jumped almost 10% after strong sales Q2 & CLSA’s outperform rating

        Tata Motors zoomed almost 8% with its strong Q2 retail sales, JLR also reported healthy growth

        HDFC shares gained 7.5% with its business inching close to pre-COVID levels, CLSA maintains outperform rating