Post Session: Quick Review

Markets end flat with a positive bias on Tuesday

Indian equity benchmarks ended flat with a positive bias on Tuesday. Markets made a strong start of the day, as sentiments got a boost with report that India reported 39,000 Covid cases, the lowest since March 18. The pace of vaccination also picked up, boosting expectations of a faster economic recovery. On Monday, India administered a record 8.1 million doses as the central government-led free for all vaccination drive kicked off. Some support also came in as the survey conducted by Ficci showed that with states easing lockdown curbs due to declining number of COVID-19 cases, there are immediate indications of improvement in economic activity as companies are hopeful of better performance in the next 6 to 12 months.

Firm trade continued over the Dalal Street for the most part of the trading session. Domestic sentiments were positive, amid report that in a move that will be beneficial for the government during the proposed initial public offer of LIC, the Department of Economic Affairs under the finance ministry has amended the Securities Contracts (Regulation) Rules. With the latest amendment in rules, companies that have a market capitalisation of more than Rs 1 lakh crore at the time of listing can now sell just five per cent of their shares. Such entities will be required to increase their public shareholding to 10 per cent in two years and raise the same to at least 25 per cent within five years.

Traders remained positive during the trading session, as the RBI data showed that bank credit grew by 5.74 per cent to Rs 108.43 lakh crore and deposits rose by 9.73 per cent to Rs 153.13 lakh crore in the fortnight ended June 4, 2021. However, in the last hour of the trade, key indices cut most of their gains to end the trading day on a flat note, as traders got concerned with report stating that Indian companies' market capitalization has grown at the fastest pace last year among major economies despite contraction in GDP, flagging the risks to financial stability it poses.

On the global front, European markets were trading mostly in red as investors paused for breath after recent volatility driven by the US interest rate outlook. Asian markets settled mostly higher on Tuesday, after Taiwan's export orders increased more than expected in May. The data from the Ministry of Economic Affairs showed that export orders advanced 29.8 percent year-on-year in May. Orders for mineral products accelerated 182.1 percent yearly in May and those of basic metals and articles thereof surged 95.3 percent. Demand for plastics and articles thereof, rubber and articles thereof increased 80.7 percent and transport equipment gained 73.8 percent.

The BSE Sensex ended at 52588.71, up by 14.25 points or 0.03% after trading in a range of 52520.55 and 53057.11. There were 12 stocks advancing against 18 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.33%, while Small cap index was up by 0.83%. (Provisional)

The top gaining sectoral indices on the BSE were Capital Goods up by 1.95%, Industrials up by 1.35%, Auto up by 1.30%, Power up by 1.17% and Basic Materials up by 0.79%, while Realty down by 0.75%, Bankex down by 0.32%, FMCG down by 0.21% and Energy down by 0.08% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Maruti Suzuki up by 5.02%, Larsen & Toubro up by 2.20%, Ultratech Cement up by 1.11%, TCS up by 0.86% and Titan Co up by 0.80%. On the flip side, Asian Paints down by 1.91%, Bajaj Finance down by 1.61%, Nestle down by 1.18%, Hindustan Unilever down by 1.05% and Indusind Bank down by 0.74% were the top losers. (Provisional)

Meanwhile, the Reserve Bank of India (RBI) in its latest report has showed that bank credit grew by 5.74 per cent to Rs 108.43 lakh crore and deposits rose by 9.73 per cent to Rs 153.13 lakh crore in the fortnight ended June 4, 2021.

As per the report, bank advances stood at Rs 102.55 lakh crore and deposits at Rs 139.55 lakh crore in the fortnight ended June 5, 2020. In the previous fortnight ended May 21, 2021, bank credit had grown at 5.98 per cent and deposits at 9.66 per cent.

According to RBI's Scheduled Banks' Statement of Position in India as on June 4, 2021, in FY2020-21, bank credit had grown by 5.56 per cent and deposits by 11.4 per cent.

The CNX Nifty ended at 15772.75, up by 26.25 points or 0.17% after trading in a range of 15752.10 and 15895.75. There were 27 stocks advancing against 23 stocks declining on the index. (Provisional)

The top gainers on Nifty were Maruti Suzuki up by 5.30%, UPL up by 3.92%, Shree Cement up by 3.59%, Wipro up by 2.66% and SBI Life Insurance up by 2.59%. On the flip side, Asian Paints down by 1.88%, Bajaj Finance down by 1.62%, Nestle down by 1.20%, Hindustan Unilever down by 0.96% and Kotak Mahindra Bank down by 0.84% were the top losers. (Provisional)

European markets were trading mostly in red, France’s CAC decreased 15.73 points or 0.24% to 6,586.81 and Germany’s DAX was down by 68.74 points or 0.44% to 15,534.50. On the flip side, UK’s FTSE 100 increased 14.01 points or 0.2% to 7,076.30.

Asian markets settled mostly higher on Tuesday with hopes of global economic recovery. New York Fed President John Williams noted the recent inflation surge is likely a temporary phase, while investors are expecting the Fed is going to be relatively slow in tapering its asset purchase program. Japanese shares ended higher, on tracking firm cues from Wall Street overnight, while higher crude oil prices also provided the boost.

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