Sensex, Nifty Snap Two-Day Losing Streak As Caution Prevails

• Benchmark indices snap two-day losing streak
• Nifty ends 0.7 percent higher at 9,270
• Nifty futures trade at a premium of 30 points
• Sensex ends 0.74 percent higher at 31,685
• Nifty Bank ends 2.2 percent higher at 19,694
• Nifty Midcap and Smallcap Indices end with gains of 0.6 percent each
• India Volatility Index ends 5.3 percent lower at 41.28
• Nifty FMCG (Down 1.87 percent) and Nifty PSU Bank (Down 0.88 percent) end as the only sectoral laggards
• Most other sectoral indices barring Nifty Auto (Up 1.84 percent) end flat
• Bajaj Finance ends as the top Nifty gainer; up 5.5 percent
• Bharti Infratel ends as the top Nifty laggard; down 5.5 percent
• 857 stocks on the NSE end with gains while 907 end with losses

Indian equity markets snapped a two-day losing streak, posting modest gains as investors exercised caution amidst the Services PMI numbers and addition of close to 3,000 fresh Covid-19 cases in the last 24 hours.

The S&P BSE Sensex gained over 550 points from the day's low of 31,158 to end at 31,685, up by 0.75 percent. The NSE Nifty 50 too gained 0.7 percent, rebounding close to 150 points from the day's low to end at 9,270.

Among sectoral indices, the Nifty Bank index outperformed the benchmarks, gaining over 800 points from the day's low to end 2.2 percent higher at 19,694.

Among other indices, the Nifty Auto index ended with gains of 2 percent while the FMCG index underperformed, ending nearly 2 percent lower.

The two and three-wheeler manufacturer has informed the exchanges that it has commenced operations across all its factories in Hosur, Mysuru and Nalagarh.

The company had suspended production across its manufacturing facilities in light of the nationwide lockdown imposed due to the Covid-19 pandemic.

Shares snapped a two-day losing streak, gaining as much as 5.7 percent to Rs 326. It is also the top performer on the Nifty Auto index.

• Buy Divis Laboratories At Rs 2,250 for target of Rs 2,393 and stop loss of Rs 2,183
• Buy Tech Mahindra at Rs 495 for target of Rs 527 and stop loss of Rs 483

The country's largest lender State Bank of India has agreed to offer a moratorium on repayment between March 1 to May 31 to NBFCs. The NBFCs will have to submit a proposal with financial details to seek moratorium, an SBI official told BloombergQuint.

The moratorium will cover any payment defaults between March 1 and May 31. The official has added that the decision has been taken by the management and that the board will give its nod soon.

Shares of SBI are off the day's high, trading with gains of 0.3 percent to Rs 170.95.

The paint manufacturer reported a 14 percent decline in its revenue to Rs 988 crore for the quarter ending March 31, 2020.

Net profit fell 23 percent to 71 crore while Ebitda too saw a decline of 14.6 percent to Rs 128 crore.

Lower other income and higher depreciation impacted the company's Profit Before Tax (PBT). The company has also declared an interim dividend of Rs 3.15 per share.

Shares recovered from the day's low and currently trade 1.8 percent higher at Rs 398.70.

The makers of Royal Enfield have informed the exchanges that it ha resumed manufacturing operations at its facilities starting today.

The company's Oragadam unit will be the first to begin operations in a staggered manner, with minimal staff over a single shift. The other two facilities in Tiruvottiyur and Vallam Vadagal will resume in a phased manner, as per its press release.

Around 120 dealerships have begun partial operations while it expects around 300 dealerships to be operational by Mid-May.

The recent rally in India's equity markets does not reflect the full impact of the Covid-19 pandemic on the economy and corporate earnings, according to HDFC Securities.

“We expect more disappointments than surprises,” Bloomberg reported quoting the brokerage note which added that it anticipates a likely pronounced negative price reaction given the recent run up.

The note further adds that the recent surge in prices is a bear market rally rather than a sustained turnaround.

Among the brokerage's top preferences were utilities, telecom and insurance players. It added that it is underweight on automobiles and consumer goods makers.

The company has reported a 78 percent drop in its bottom-line for the quarter ended March 31 to Rs 61.2 crore. While topline grew only 1.5 percent year-on-year, Ebitda margin has contracted to 4.2 percent from 5.6 percent.

The profitability was also aided by a tax gain of Rs 33.1 crore as compared to a tax expense of Rs 127 crore in the same quarter last year.

The company has approved enabling resolutions to raise fund. It intends to raise Rs 2,500 crore through equity and up to Rs 1,000 crore through bonds.

Shares fell as much as 4.1 percent to Rs 127.30 post the announcement.

• Benchmark indices hold on to gains
• Nifty up 1 percent at 9,295
• Nifty futures trade at a premium of 12 points
• Sensex up 1 percent at 31,779
• Nifty Bank up 2.2 percent at 19,698
• Nifty Midcap and Smallcap Index up 0.7 percent each
• Nifty FMCG index remains top sectoral laggard; down 1.74 percent
• Nifty Auto and Nifty Realty are the other sectoral indices with gains of over 1 percent
• Bajaj Finance is the top gainer on the Nifty; up 5.7 percent
• ITC remains the top Nifty laggard; down 6.6 percent
• 844 stocks on the NSE are advancing while 893 trade with losses

It was another quiet session for the rupee as it traded in a narrow range and ended with modest losses near the lowest point of the day.

The currency ended at 75.76 against the U.S. Dollar as compared to Tuesday's close of 75.64. It made an intra-day low of 75.80.

Rahul Gupta, Head of Currency Research at Emkay Global Financial Services said that the currency may see a bounce towards 76.50 due to trade war, Covid-19 and GDP growth concerns.

Yield on the 10-year treasury cooled off further towards the 6 percent mark, ending at 6.028 percent as compared to Tuesday's close of 6.074.

• Trades at an all-time low
• Worst performer on the BSE Midcap Index
• Locked in a 5 percent lower circuit for the last 3 trading sessions
• Has fallen over 60 percent from its 52-week high of Rs 1,217 on March 2, 2020
• Today's volumes are 1.7 times higher than its 30-day average
• 10 out of the 23 analysts tracking the stock have a buy recommendation; 6 sell calls
• Return potential of the stock as per Bloomberg data is 22.6 percent

The company has informed the exchanges that it has started primary billing from May 4 and that one-third of its Prestige Xclusive stores in green and orange zones have started retailing.

Its manufacturing facilities at Hosur, Uttarakhand and Karjan have started day-to-day operations after obtaining necessary permissions, as per the company's press release.

The release further states that online sales will resume from May 6 after warehouses are sanitised and resume work with applicable conditions.

Shares are off the day's high after gaining as much as 2.33 percent to Rs 4,769.95.

• Down for the fourth straight day
• Falls as much a 7.7 percent to Rs 160.5
• Contributing 25 points to the Nifty downside
• Trades at the lowest level in a month
• Today's volumes are double than its 30-day average
• Currently trades 47 percent lower than its 52-week high of Rs 310
• Broke below its 50-day Moving Average of Rs 177.85
• 30 out of the 38 analysts tracking the stock have a buy recommendation; 1 sell call
• Return potential of the stock as per Bloomberg data is 43 percent

European markets have opened with a negative bias, looking set for their fourth day of decline in the last five trading sessions. Futures on the Dow Jones are trading with gains of 170 points.

The Stoxx 600 has opened little changed with declines seen in oil & gas along with travel stocks. Healthcare stocks are outperforming.

Brent Crude hovers around the $30 per barrel mark while Gold is little changed.

Lets take a look at how Benchmarks across Europe have opened:

• Euro Stoxx 50 is little changed at 2,874
• DAX down 0.1 percent at 10,717
• CAC is little changed at 4,480
• FTSE 100 is little changed at 5,851
• IBEX 35 down 0.55 percent to 6,710

• Trades at a lifetime high
• Gains as much as 11.2 percent to Rs 621.7
• Up for the second straight day
• Today's volumes are 7.6 times higher than its 30-day average
• Trades at 15 times estimated forward Earnings Per Share as compared to its historical average of 12.8 times
• Has more than doubled from its 52-week low of Rs 307 on May 10, 2019
• All 4 analysts tracking the stock have a buy recommendation
• Return potential for the stock as per Bloomberg data is 13.8 percent

The company has announced the launch of Desmopressin Acetate Injection in the U.S. Market.

The said drug had sales of $20.9 million for the most recent 12-month ending March 2020, according to IQVIA.

Shares recovered from the day's low to gain as much as 1.2 percent to Rs 3,879 on the National Stock Exchange.

The company has informed the exchanges that it has won an order amounting to Rs 293.33 crore towards the supply of MRSAM Missile Sections for Indian Air Force deliverables.

The amount of the order is excluding the GST component. The order has to be executed in the next 24 months.

The stock gained as much as 7.4 percent to Rs 229.8 and is up for the second straight day.

• Trades at the lowest level since November 1, 2004
• Falls as much as 5.2 percent to Rs 28.9
• Has gained only on 4 instances in the last 16 trading sessions
• Today's volumes are 2.4 times higher than its 30-day average
• The company will be reporting its fourth quarter earnings on Friday
• Has fallen 61 percent from its 52-week high of Rs 74.15 on July 3, 2019
• 13 out of the 18 analysts tracking the stock have a buy recommendation; 2 sell calls
• Return potential for the stock as per Bloomberg data is 107.5 percent

• Benchmark indices consolidate near day's high
• Nifty up 1.1 percent at 9,310
• Nifty futures trade at a premium of 15 points
• Sensex up 1.2 percent at 31,839
• Nifty Bank up 2 percent at 19,656
• Nifty Midcap and Smallcap index up 0.6 percent
• India Volatility Index down 4.4 percent to 41.67
• Nifty FMCG (Down 1.5 percent) and Nifty PSU Bank (Down 1.35 percent) remain top sectoral laggards
• Nifty Auto, Nifty I.T. Index gain 1 percent each
• HDFC is the top Nifty gainer; up 3.8 percent
• ITC is the top Nifty laggard; down 6.4 percent
• 792 stocks on the NSE are advancing while 886 are declining

• Up for the seventh straight day
• Longest winning streak in a month
• Locked in a 5 percent upper circuit on all seven days
• Up 40 percent in the last seven sessions
• Trades at the highest level in nearly two months
• Today's volumes are low at 0.3 times its 30-day average
• Stock has entered overbought territory with Relative Strength Index (RSI) at 71
• The stock has broken above its 50-day Moving Average of Rs 97.34
• Up 86 percent from its 52-week low of Rs 58.6 on March 25, 2020
• 9 out of the 10 analysts tracking the stock have a buy recommendation; 0 sell calls
• Return potential as per Bloomberg data is 20.2 percent

The Delhi High Court has allowed the telecom operator to rectify its GST returns between July-September 2017.

The company had told the high court that it had paid an excess tax of Rs 923 crore as input tax credit as details of that period was based on estimates due to non-operationalisation of the input tax credit (GSTR-2A) form by the government.

The court has allowed the company to rectify its tax filing for the period and has asked the government to verify the claim within two weeks of the rectified return being filed.

Shares gained as much as 3.4 percent to Rs 546 but are off the day's high, trading with gains of 1.74 percent currently at Rs 537.25.

The company in a notice to the exchanges has informed that Aleor Dermaceuticals, a 60:40 joint venture between the company and Orbicular Pharma Technologies got the Establishment Inspection Report (EIR) from the U.S. FDA for its facility in Karakhadi, Gujarat.

The regulator had conducted the inspection at the said facility between January 6-8, 2020.

Shares gained as much as 4.56 percent to Rs 785 on the National Stock Exchange.

Amansa Holdings acquired 2.82 percent stake in the company or 8.1 lakh shares at Rs 245.5 per share on Tuesday.

The seller in this trade was DSP Mutual Fund which sold 8.43 lakh shares or 2.94 percent stake at Rs 245.5 per share.

Shares gained as much as 5 percent to Rs 274.6 and are up for the sixth out of the last 7 trading sessions.

The company informed the exchanges that it managed to sell 761 units in the month of April, a 2.6 times increase compared to the 289 units sold in April last year.

However, tractor sales declined 24 percent year-on-year to 328 units from 432 units in April 2019.

Shares gained as much as 10 percent to Rs 947.75 and are up for the second straight day.

• Reliance Industries' 1,500 Call: Premium up 8.55 percent to Rs 66. The contract has added 1.37 lakh shares in Open Interest.
• Axis Bank's 400 Call: Premium falls 4.8 percent to Rs 29.6. The contract has added 3.52 lakh shares in Open Interest.
• State Bank of India's 160 Put: Premium falls 16.7 percent to Rs 8.2. The contract has shed 5.31 lakh shares in Open Interest.

India's Services Purchasing Managers Index fell to 5.4 in the month of April, hitting single digits for the first time, according to data published by IHS Market. The services sector makes up for more than half of India's GDP.

Bloomberg Economics is projecting a 4.5 percent contraction in India's GDP for the year, Standard Chartered Plc is projecting a 2 percent contraction.

The company reported its fourth quarter earnings overnight where it saw a 1.8 percent sequential decline in its dollar revenue to $127.05 million. Revenue in rupee terms was largely flat at Rs 926.36 crore, up 0.4 percent from the previous quarter. Net profit for the full year fell 4.7 percent from the previous quarter to Rs 83.8 crore.

For the full year of FY20, the company reported a topline growth of 5.9 percent while crossing half billion dollars in revenue.

Shares gained as much as 10.1 percent to Rs 515. The stock is up for the second straight day and is the second best performer on the Nifty Smallcap index.

• Nifty May futures add 7.4 percent in Open Interest and 6.18 lakh shares
• Nifty Bank May futures add 16 percent in Open Interest and 2.2 lakh shares

Nifty: May 7 Expiry

• 9,300 Call: Premium up 6.5 percent to Rs 98.3. The contract has added 2.43 lakh shares in Open Interest.
• 9,200 Call: Premium up 9.1 percent to Rs 150.5. The contract has added 5.47 lakh shares in Open Interest.
• 9,000 Put: Premium fall 55.6 percent to Rs 28.45. The contract has added 4.68 lakh shares in Open Interest.

Nifty Bank: May 7 Expiry

• 20,000 Call: Premium falls 20.2 percent to Rs 147.2. The contract has added 2.5 lakh shares in Open Interest.
• 18,500 Put: Premium falls 52.66 percent to Rs 81.5. The contract has added 3.06 lakh shares in Open Interest.
• 19,500 Call: Premium up 0.8 percent to Rs 341.7. The contract has added 1.26 lakh shares in Open Interest.

• Benchmark indices fluctuate between gains and losses but are off the day's low
• Nifty up 0.5 percent at 9,253
• Nifty futures trade at a premium of 12 points
• Sensex up 0.6 percent at 31,628
• Nifty Bank up 0.8 percent at 19,446
• Nifty Midcap and Smallcap index are up 0.1 and 0.2 percent respectively
• India Volatility Index down 4.8 percent to 41.51
• Nifty FMCG is the top sectoral laggard; down 1.8 percent
• Nifty PSU Bank is the other sectoral laggard; down 1.3 percent
• Bharti Airtel is the top Nifty gainer; up 2.8 percent
• ITC is the top Nifty laggard; down 6.2 percent
• 663 stocks on the NSE are advancing while 923 trade with losses

The rupee has opened on a weak note in today's trading session owing to a host of weak global and domestic cues and weakness in the equity markets.

The currency opened at 75.74 against the U.S. Dollar as compared to Tuesday's close of 75.64.

Kotak Securities believes that the near-term range for the rupee is between 75-76.50 against the greenback.

Yield on the 10-year Government bond opened at 6.038 percent as compared to Tuesday's close of 6.07 percent.

45.8 lakh shares of the heavy vehicles maker exchanged hands in two large trades on the National Stock Exchange, as per Bloomberg data.

Buyers and sellers of the trade were not immediately known.

Shares are currently trading 0.6 percent higher at Rs 48.65.

The company reported a 3.3 percent rise in its topline for the fourth quarter on a sequential basis. The 7.9 percent drop in net profit can be attributed to an exceptional loss of Rs 12.8 crore in the current quarter.

In its investor presentation, the company has mentioned that it has added 10 new customers during the quarter and has executable business worth $468 million over the next 12 months.

The company declared an interim dividend of Rs 11 per share. The board has also given its approval to change the name of the company to Coforge Limited.

Shares are locked in an upper circuit of 10 percent at Rs 1,308.7 and are up for the sixth time in the last seven trading sessions. It is also the top gainer on the Nifty I.T. index.

The port operator reported a 74 percent drop in net profit to Rs 334 crore in the fourth quarter, mainly led by a 32 percent jump in other expenses and a forex loss of Rs 1,004 crore.

The revenue and Ebitda for its SEZ business fell 89 and 98 percent respectively compared to the previous quarter.

The company in its FY21 outlook has stated that it will focus more on conserving cash. Capex plans for FY21 will be curtailed to Rs 1,800 crore to Rs 2,000 crore from Rs 3,615 crore in FY20.

Brokerage firm JPMorgan has maintained its overweight rating on the stock with a price target of Rs 340.

Shares gained as much as 3.95 percent to Rs 273.50, snapping a two-day losing streak. It is also the top gainer on the Nifty 50 index.

Fuel retailers like HPCL, BPCL and Indian Oil Corporation are the biggest laggards in today's trading session after the government on Tuesday hiked the excise duty on petrol and diesel by Rs 10 and Rs 13 per litre respectively.

However, the steepest hike in excise duty will not be passed on to customers as retail fuel prices will remain unchanged.

As a result of this move, the OMCs, which earned a gross marketing margin of Rs 18-20 on retail fuels will now earn lesser. Data analysis suggests that HPCL will be the most impacted, followed by BPCL and Indian Oil.

• Shares of HPCL fell as much as 10 percent to Rs 193.15.
• Shares of BPCL fell as much as 10.1 percent to Rs 312.15.
• Shares of Indian Oil Corporation fell as much as 7.5 percent to Rs 72.8. It now trades at the lowest level since May 2014.

Indian equity markets have opened on a cautious note, in-line with its peers across Asia and amidst news that the total number of Covid-19 cases in India are near the 50,000 mark. Futures on the Dow Jones are currently flat.

The S&P BSE Sensex opened 0.4 percent higher at 31,577, only to give up gains soon after. The index followed a similar trend on Tuesday to end lower for the second straight session.

The NSE Nifty 50 index slipped below the 9,200 mark after opening 0.2 percent higher at 9,226. Both benchmarks are down over 6 percent for the week.

Most sectoral indices have opened flat with the Nifty FMCG index being the only one to open with losses while the Nifty Media index opened with gains of 1%.

• Sell Hero Motocorp for target of Rs 1,910 and stop loss of Rs 2,020
• Buy Sun TV at Rs 370-373 for target of Rs 395

• Buy Bharti Airtel for target of Rs 555 and stop loss of Rs 515
• Sell State Bank of India for target of Rs 160 and stop loss of Rs 177

• Oil Marketing Companies: Excise duty on petrol and diesel has been hiked by Rs 10 and Rs 13 respectively. This is the steepest such hike in excise duty. Retail fuel prices remain unchanged which means that OMCs will have to bear the brunt of the hike. HPCL, BPCL and Indian Oil were earning a gross marketing margin of Rs 18-20 on retail fuel which now stands reduced.
• Reliance Industries: To redeem debt notes due in 2035 along with interest on June 5, 2020. The principal amount payable is $200 million and interest will be close to $5 million.
• Adani Ports & SEZ: The company plans to reduce operating costs in FY21. It is expecting a slow pick-up in cargo volumes in Q2FY21. It is also anticipating a V-shaped recovery in H2FY21 post complete lifting of the lockdown. Gross debt at Rs 29,463 crore Vs Rs 27,188 crore. Capex to be curtailed to Rs 1,800 crore - Rs 2,000 crore in FY21 Vs Rs 3,615 crore in FY20.
• VST Tillers Tractors: Power Tillers sales up 2.6 times at 761 units while Tractors sales down 24 percent at 328 units in April
• Piramal Enterprises: Clarifies that no proposal has been placed before the board. Newspaper reports on Tuesday suggested that KKR looks to buy 20 percent stake in the company for Rs 3,500 crore.
• Wipro: Signs MoU with Maharashtra to re-purpose its I.T. facility in Pune to a 450-bed Covid-19 hospital. Hospital to be converted back to an I.T. facility in a year.

For all that you need to know going into today’s trade, click here.

• Benchmarks ended higher despite late session swings
• S&P 500 ended 0.9 percent higher; off the day's high
• Healthcare, Utilities and I.T. sectors outperformed
• Tech outperformance led to Nasdaq ending 1.1 percent higher
• Fed Vice Chairman Richard Clarida has warned that the economy will need more Government support.
• Oil posted its longest run of daily gains in more than nine months.
• Yield on the two-year treasury was the lowest in more than eight years

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Good Morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, was up 0.4 percent to 9,223 as of 7:35 a.m.

Markets in Asia have opened on a cautious note with equities in China retreating on their first trading day after a long weekend. Markets in Australia and Taiwan are underperforming while those in South Korea and Singapore are trading with gains.

China's onshore yuan fixing on Wednesday was slightly stronger than expected. Futures on the S&P 500 are flat while Brent Crude touched the $30 per barrel mark.

Short on time? Well, then listen to this podcast for a quick summary of All You Need To Know before the opening bell.