Market rises for 2nd day, Nifty ends near 16,800; metal stocks rally

The domestic equity benchmarks bounced off initial losses and ended with modest gains on Monday. The Nifty closed near the 16,800 mark after hitting the day`s low of 16,356.30 in morning trade. Autos, banks, financial shares were under pressure. On the other hand, metals and oil & gas shares rallied.

The barometer index, the S&P BSE Sensex, jumped 388.76 points or 0.70% to 56,247.28. The Nifty 50 index added 135.50 points or 0.81% to 16,793.90.

PowerGrid Corporation of India (up 6.03%), Reliance Industries (up 3.29%), Infosys (up 1.38%) and Titan Industries (up 3.11%) boosted the indices.

The NSE`s India VIX, a gauge of market`s expectation of volatility over the near term, surged 6.84% to 28.57.

The continued escalation of the Russia Ukraine conflict and its consequent global economic fallout continued to weigh on the investor`s sentiment.

In the broader market, the S&P BSE Mid-Cap index gained 0.83% while the S&P BSE Small-Cap index rose 0.80%.

The market breadth was strong. On the BSE, 2115 shares rose and 1332 shares fell. A total of 145 shares were unchanged.

The domestic stock market will remain shut on Tuesday, 1 March 2022, on account of Mahashivratri.

Numbers to Track:

The yield on India`s 10-year benchmark federal paper was currently at 6.769% as compared with its previous close of 6.749%.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 75.35, compared with its close of 75.33 during the previous trading session.

MCX Gold futures for 5 April 2022 settlement added 0.98% to Rs 50,715.

In the commodities market, Brent crude for April 2022 settlement added $4.97 or 5.28% to $99.09 a barrel.

The US Dollar index (DXY), which tracks the greenback`s value against a basket of currencies, was up 0.48% at 97.08.

Global Stocks:

In the global market, the Dow Jones index futures were down 464 points, indicating a weak opening in the US stocks today.

European shares fell across the board as more sanctions have been imposed on Russia for its invasion of Ukraine, with the U.S., Europe and Canada agreeing Saturday to remove key Russian banks from the interbank messaging system, SWIFT. The U.K. and EU have also closed their airspace to Russian aircraft.

Asian stocks, however, settled higher as investors continued to monitor the Russia-Ukraine crisis and related sanctions and their fallout.

Russia-Ukraine Conflict:

Russia continued its advance into Ukraine over the weekend, with reports of fighting on the streets and forces encircling Kyiv. President Vladimir Putin on Sunday put his country`s deterrence forces, which reportedly include nuclear capabilities, on high alert in response to international backlash to Russia`s invasion.

Western nations agreed to unleash new sanctions to further isolate Russia`s economy and financial system after initial penalties failed to persuade President Vladimir Putin to withdraw his forces from Ukraine.

In yet another step that is expected to escalate tensions between the West and Kremlin, President Vladimir Putin has reportedly ordered his defence chiefs to put Russia`s nuclear "deterrence forces" on high alert due to "unfriendly steps" by the United States (US) and its allies. This comes after Ukrainian President Volodymyr Zelenskyy reportedly agreed to hold talks with the Russians on the Belarus border. Meanwhile, the United Nations Security Council (UNSC) on early Monday morning reportedly held another meeting over Ukraine and warned Russia of more economic sanctions, urging President Putin to maintain peace.

Russia`s central bank announced Monday it was raising its key interest rate to 20% from 9.5% as the West pummelled the country with sanctions. The move is a desperate attempt to shore up the plummeting ruble and prevent the run of banks. The move follows a Western decision Sunday to freeze Russia`s hard currency reserves, an unprecedented move that could have devastating consequences for the country`s financial stability.

Buzzing Indian Segment:

The Nifty Metal index surged 4.95% to 5,896.85. The index has soared 10.98% in two sessions.

Tata Steel (up 6.33%), Jindal Steel & Power (up 5.98%), SAIL (up 4.97%), Vedanta (up 4.8%), JSW Steel (up 4.58%), Coal India (up 3.52%), Hindustan Copper (up 3.3%), NALCO (up 3.15%), Ratnamani Metals & Tubes (up 3.13%), APL Apollo Tubes (up 1.61%), NMDC (up 1.49%), Adani Enterprises (up 1.25%), Hindustan Zinc (up 0.4%) and Welspun Corp (up 0.25%) surged.

Hindalco Industries surged 7.16%. The company announced that it has entered into a share purchase agreement with Brazil`s Terrabel Empreedimentos to divest entire equity shareholding in Hindalco Do Brazil Industria Comercia de Alumina LTDA (HDB).

Stocks in Spotlight:

Future Retail (FRL) surged 7.10% after the media reported that Reliance Industries (RIL) will take over the flagship supermarkets of the Future Group for missed lease payments.

The media reported that RIL has seized control over the sites of 300-odd large-format stores of the Future Group and has been shuttering them in the last few days, for alleged non-payments of rents to RIL. These include 200 sites where FRL`s hypermarket chain, Big Bazaar, used to operate. There are also 100-odd locations that housed the outlets of Central and Brand Factory, the fashion stores owned by Future Lifestyle Fashions.

Biocon fell 11.47%. Biocon Biologics (BBL), a subsidiary of Biocon, has entered into a definitive agreement with its partner Viatris Inc. Accordingly, BBL will acquire Viatris` biosimilars business to create a unique fully integrated global biosimilars enterprise.

Viatris will receive cash consideration of $2 billion on closing of the transaction and up to $335 million as additional payments expected to be paid in 2024. Additionally, upon closing of the transaction, BBL will issue $1 billion of Compulsorily Convertible Preference Shares (CCPS) to Viatris, equivalent to an equity stake of at least 12.9% in the company, on a fully diluted basis.

Rain Industries slumped 7.51% after the company posted a consolidated net loss of Rs 97 crore in Q4 December 2021 as against a net profit of Rs 307 crore registered in Q4 December 2020. Net sales jumped 52.5% to Rs 4,026 crore in Q4 December 2021 from Rs 2,640 crore posted in Q4 December 2020.

Ugro Capital rose 3.34%. The company on Monday announced that its investment and borrowing committee approved a fund raising of Rs 50 crore with an option to retain over-subscription up to Rs 50 crore, aggregating up to Rs 100 crore. The NBFC will raise the funds via three series of different maturities and tenures. The proposed debentures will be listed on BSE and the National Stock Exchange.

Vedavaag Systems jumped 2.29% after the company said it has entered into an agreement with Angel One to act as corporate DRA. As a corporate DRA to Angel One, Vedavaag Systems will facilitate demat account opening services, equity and mutual fund investment services through its country wide network of 2880+ Varishta service points that span over 19 states.

Vipul Organics rose 3.99% after the company`s board recommended bonus issue of shares in the ratio of 1:4. The company proposes to issue 1 new fully paid-up equity share for every 4 fully paid-up equity shares held. The record date for the bonus issue is set on 9 April 2022.

Further, the board allotted 3,34,000 equity shares at an issue price Rs 111 each upon conversion of 3,34,000 warrants issued on preferential basis.

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