Sensex, Nifty Recover Most Of Thursday’s Losses; Trim Weekly Fall

Indian equity markets began the October series on a strong footing, recovering most of Thursday's losses and also cutting the losses for the week by half.

The S&P BSE Sensex endex 2.3% higher at 37,388, recovering 830 out of the 1,100 points it fell on Thursday. The NSE Nifty 50 index to recovered 230 out of 330 point drop on Thursday to end at 11,037, up 2.1%. All but 3 stocks on the Nifty, ended with gains in today's session, mirror image to the expiry day session.

The Nifty debutants today had a mixed session. Divi's Laboratories had a steady start, ending with gains of 1% while SBI Life Insurance ended as one of four laggards on the index, ending lower by over 1%.

All sectoral indices ended with gains. Nifty Auto and Nifty I.T. indices were the top sectoral gainers in today's session, both ending higher by 3.3%.

Two other indices - Nifty Media and Nifty PSU Bank saw gains of over 3%. The PSU Bank index, which underperformed for most of the session saw a surge in the final minutes of trade.

Rest of the sectoral indices, Nifty Bank, Nifty FMCG, Nifty Metal, Nifty Pharma and Nifty Realty, all ended with gains higher than 2%.

Broader markets reversed most of Thursday's losses as well. The Nifty Midcap index ended 2.8% higher while the smallcap index was not far behind, ending with gains of 2.7%.

The India Volatility Index, after a 12% surge on Thursday, ended 11.7% lower at 20.76.

1,513 stocks on the NSE ended with gains while 320 stocks posted losses.

• Top gainer on the Nifty 50 index
• Gains as much as 8.9% to Rs 5,906
• Biggest single-day gain since October 2018
• Snaps six-day losing streak
• Today's volumes are 80% higher than its 20-day average
• Trading near its 100-Day Moving Average of 5,821
• Relative Strength Index (RSI) of the stock rebounds from oversold territory; currently at 42
• Has declined 43% from its 52-week high of Rs 10,297 on December 18, 2019
• 10 out of the 14 analysts tracking the stock have a buy recommendation; 0 sell calls
• Return potential of the stock as per Bloomberg data is 26.8%

India is considering a floor price for natural gas produced from local fields to shield explorers like ONGC, as tariffs slump, people with knowledge of the matter told Bloomberg.

The proposal being considered by the oil ministry, pegs the price to the popular benchmark Japan-Korea Marker, that is used for LNG tariff in North Asia with a discount, sources said.

Prices of natural gas produced from domestic fields that were handed over to ONGC and Oil India have fallen to the lowest in a decade and are below the imported price of the fuel. A global glut is threatening to undermine the investments and turn gas businesses of ONGC and Oil India unviable.

Shares of ONGC gained as much as 4% to Rs 69.25, snapping a four-day losing streak, while those of Oil India too snapped a four-day losing streak, gaining as much as 4% to Rs 88.

• Reliance Industries' 2,300 Call: Premium down 2.3% to Rs 57.65. The contract has added 2.9 lakh shares in Open Interest.
• TCS' 2,500 Call: Premium up 47% to Rs 67.2. The contract has added 13,500 shares in Open Interest.
• HUL's 2,100 Call: Premium up 9.1% to Rs 56.1. The contract has added 1 lakh shares in Open Interest.

The state-run lender at its meeting held today, has decided to raise additional equity share capital worth Rs 2,000 crore through a Qualified Institutional Placement (QIP).

The bank will equity shares of face value of Rs 10 each in one or more tranches and the premium will be decided as per applicable guidelines, the bank said.

The QIP issue will be within the overall maximum limit board approved capital raising plan of Rs 5,000 crore.

Shares gained as much as 4.6% to Rs 87.15, post the announcement. The stock has snapped a seven-day losing streak.

India is likely to see a slower pace of economic growth over the next few years, which means stock investors should expect lower returns, according to analysts at Quantum Advisors.

"India's stock market has rebounded more than 40% from a March bottom. But whether it can deliver the 12-15% annual return frequently touted by local asset managers in the long-term, depends on how fast India's economy will grow," Arvind Chari, head of fixed income and alternative investments at Quantum said in the note.

The continued rise in stock prices combined with declines in profit expectations have driven the Sensex to its highest valuation multiple since 2008.

"In the very near-term, with virtually zero earnings visibility, equities are likely to be driven by the success or failure of outcomes of policies dictated by a government that is still not coming to grips with the economy's real problems," Chari said.

• Biggest single-day gain in five months
• Gains as much as 7.7% to Rs 370
• Trades at the highest level in a week
• Has declined in six out of the last 10 trading sessions
• Today's volumes are nearly triple its 20-day average
• Nearing its 100 and 50-Day Moving Average at 377.5 and 378.2
• Trading at 29% premium versus peers as compared to an average of 74% over the last two years over a blended forward EV/Ebitda basis
• Has nearly halved from its 52-week high of Rs 718.25 on September 27, 2019
• 13 out of the 18 analysts tracking the stock have a buy recommendation
• Return potential of the stock as per Bloomberg data is 27.3%

• Benchmark indices trade near the day's high
• Nifty up 1.76% at 10,995
• Sensex up 1.8% at 37,201
• Nifty Bank up 1.7% at 20,792
• Nifty Midcap index up 2.2%
• Nifty Smallcap index up 2%
• India Volatility Index down 8.3% to 21.54
• Nifty I.T. remains the top sectoral gainer; up 3.1%
• Nifty Auto, Nifty FMCG< Nifty Media, Nifty Metal and Nifty Pharma gain over 2% each
• Nifty Realty and Nifty PSU Bank index up 1.7% each
• Bharti Airtel is the top Nifty gainer; up 6%
• 47 out of the 50 Nifty constituents trade with gains
• Bharat Petroleum is the top Nifty laggard; down 2.2%
• 1,431 stocks on the NSE trade with gains while 372 decline

The currency ended stronger in today's session, recovering most of the losses made during the session on Thursday.

The rupee ended at 73.61 against the U.S. Dollar as compared to Thursday's close of 73.90. The rupee has emerged as the best performing currency in today's session.

“Unless the U.S. stimulus bill is passed, we may continue to observe the uptrend in spot towards the 74 zone,” Rahul Gupta of Emkay Global Financial Services was quoted as saying. “In the coming sessions, we expect the currency spot to trade between 73.40-74,” he said.

Today's gains narrowed the losses for the currency on a weekly basis. Despite ending 0.2% lower for the week, the rupee was the third best performing currency in Asia.

Yield on the 10-year government bond ended at 6.01% as compared to Thursday's close of 5.994%.

• Nifty October futures add 19.6% and 15.75 lakh shares in Open Interest.
• Nifty Bank October futures add 12.1% and 2 lakh shares in Open Interest.

Nifty: October 1 Expiry

• 11,000 Call: Premium up 67.5% to Rs 112.45. The contract has added 4 lakh shares in Open Interest.
• 10,900 Put: Premium down 50.3% to Rs 87.1. The contract has added 15.2 lakh shares in Open Interest.
• 10,800 Put: Premium down 53.5% to Rs 59. The contract has added 15.7 lakh shares in Open Interest.

Nifty Bank: October 1 Expiry

• 21,000 Call: Premium up 31.5% to Rs 298. The contract has added 3.8 lakh shares in Open Interest.
• 20,000 Put: Premium down 40% to Rs 138.8. The contract has added 4.7 lakh shares in Open Interest.
• 20,500 Put: Premium down 34.3% to Rs 273.9. The contract has added 3.5 lakh shares in Open Interest.

• Gains as much as 12.6% to Rs 33.6
• Biggest single-day gain in over five months
• Snaps seven-day losing streak in today's session
• Today's volumes are 98% higher than its 20-day average
• Breaks above its 50-Day Moving Average of 32.55
• Nearing its 200-Day Moving Average of 35.24
• Relative Strength Index (RSI) of the stock rebounds to 52.2
• Still over 50% away from its 52-week high of Rs 69.45 on November 21, 2019
• 16 out of the 18 analysts tracking the stock have a buy recommendation; 1 sell call
• Return potential of the stock as per Bloomberg data is 45.4%

The company has informed the exchanges that the Reserve Bank of India has granted in-principle authorisation to the company, to set-up and operate a Bharat Bill payment operating unit.

The company can now directly handly payment and aggregation of payment services relating to bills under the scope of the Bharat Bill Payment servics.

It will now have direct access to operate as an operating unit under the Bharat Bill Payment Unit and shall provide services to its customers in the most remote parts of the country, the company statement said.

Shares are locked in an upper circuit of 10% at Rs 27.10, post the announcement.

Benchmark indices in Europe have opened flat, despite positive cues from across the Asia Pacific. The continent re-emerging as a hotspot for Covid-19 is keeping sentiment in check.

The Stoxx 600 has opened little changed with miners and banking stocks gaining. The index is set for its worst weekly drop since June.

Asian Markets, barring the Hang Seng have ended with gains while Dow Futures are off the day's high and are trading with gains of 40 points.

Brent crude is trading little changed at $42 per barrel, as is Gold, at $1,872.5/Oz.

Let's take a look at how benchmark indices in Europe are trading:

• Euro Stoxx 50 down 0.3% at 3,150
• DAX down 0.2% at 12,577
• CAC down 0.45% at 4,741
• FTSE 100 up 0.1% at 5,829
• IBEX 35 down 0.3% at 6,622