Sensex climbs 157 pts, Nifty ends above 17,330; pharma shares correct

Domestic stock market advanced on Thursday, as traders built up positions ahead of Q2 result season starting next week. Global cues were mixed on looming recession fears. Metal and realty shares rallied while pharma, healthcare and FMCG shares corrected after recent steep gains.

The barometer index, the S&P BSE Sensex, rose 156.63 points or 0.27% to 58,222.10. The Nifty 50 index added 57.50 points or 0.33% to 17,331.80.

After a gap-up opening, the Nifty 50 index hit the day`s high of 17,428.80 in morning trade. The index, however, settled with small gains as profit selling emerged in mid-afternoon trade. Trading was volatile due to expiry of weekly index options on the NSE.

ICICI Bank (up 2.04%), Infosys (up 1.76%), LT (up 2.24%), Axis Bank (up 1.65%) and Reliance Industries (up 0.40%) boosted the indices.

The broader market outperformed the benchmark indices. The S&P BSE Mid-Cap index rose 1.13% while the S&P BSE Small-Cap index gained 1.30%.

The market breadth was strong. On the BSE, 2365 shares rose and 1095 shares fell. A total of 123 shares were unchanged.

Economy:

The seasonally adjusted S&P Global India Services PMI Business Activity Index stood at 54.3 in September, signalling growth for the fourteenth consecutive month. That said, falling from 57.2 in August, the latest reading highlighted the weakest rate of expansion since March.

Companies linked higher output to greater bookings, events and client bases. The upturn was reportedly restricted by price pressures, an increasingly competitive environment and unfavourable public policies.

Numbers to Track:

The yield on India`s 10-year benchmark federal paper rose to 7.454 as compared with 7.362 at close in the previous trading session.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 82.04, compared with its close of 81.6200 during the previous trading session.

MCX Gold futures for 5 December 2022 settlement rose 0.51% to Rs 51,907.

The US Dollar index (DXY), which tracks the greenback`s value against a basket of currencies, was up 0.24% to 111.34.

The United States 10-year bond yield increased to 3.775 as compared with 3.759 at close in the previous trading session.

In the commodities market, Brent crude for December 2022 settlement lost 15 cents or 0.16% at $93.22 a barrel.

Global Markets:

The Dow Jones futures declined 187 points, indicating a negative opening in the US stock market today.

European shares fell across the board while most Asian stocks advanced on Thursday. Mainland China markets are closed for a holiday this week.

Wall Street stocks closed lower on Wednesday after data showing strong U.S. labor demand again suggested the Federal Reserve will keep interest rates higher for longer. Fed officials have insisted on aggressive rate tightening to battle inflation, a message the market has feared would lead to a hard landing and likely recession.

The U.S. trade deficit fell slightly more than expected in August to its lowest level in more than a year, the Bureau of Economic Analysis reported Wednesday. The trade shortfall declined to $67.4 billion, a $3.1 billion drop from the previous month. In March 2022, the deficit had hit a record $106.9 billion.

Buzzing Segment:

The Nifty Pharma index fell 0.34% to 13,188, snapping a six-day rising streak. The index jumped 6.08% in the past six sessions.

Gland Pharma (down 2.71%), Lupin (down 2.58%), Biocon (down 2.36%), Granules India (down 2.18%), Divi`s Laboratories (down 1.33%), IPCA Laboratories (down 1.26%), Glenmark Pharmaceuticals (down 1.01%), Alkem Laboratories (down 0.91%) and Cipla (down 0.84%) declined.

Stocks in Spotlight:

Ujjivan Small Finance Bank rallied 5.17%. The bank`s gross loan book jumped 44% to Rs 20,938 crore as on 30 September 2022 as against Rs 14,514 crore recorded on 30 September 2021. Total Deposits aggregated to Rs 20,389 crore as on 30 September 2022, up 45% YoY.

RBL Bank advanced 2.93%. The private lender`s total deposits rose 5% to Rs 79,407 crore as of 30 September 2022 from Rs 75,588 crore recorded on 30 September 2021. The bank`s retail LCR deposits aggregated to Rs 32,804 crore as on 30 September 2022, recording a growth of 4% YoY.

Yes Bank rose 1.85%. The bank`s deposits increased by 13.2% to Rs 2,00,020 crore as on 30 September 2022 from Rs 1,76,672 crore as on 30 September 2021. Loans & advances as on 30 September 2022 stood at Rs 1,92,809 crore, up by 11.6% YoY.

Bajaj Finance fell 1.18%. The NBFC said new loans booked during Q2 FY23 were 6.8 million, up 7.94% compared with 6.3 million in Q2 FY22. Deposit book stood at approximately Rs 39,400 crore as of 30 September 2022, a YoY growth of 37%. Customer franchise as of 30 September 2022 stood at 62.9 million, up 19.13% YoY. Assets under management (AUM) grew by 31% YoY to approximately Rs 218,350 crore as of 30 September 2022.

Larsen & Toubro (L&T) advanced 2.24%. The company said that the buildings & factories business of L&T Construction has secured an order from a leading automobile major to construct a state-of-the-art manufacturing facility in Haryana. As per L&T`s classification, the value of the significant project is Rs 1,000 crore to Rs 2,500 crore.

Zee Entertainment Enterprises rallied 4.65%. The Competition Commission of India (CCI) approved the merger of Zee Entertainment Enterprises with Sony Pictures Networks India and Bangla Entertainment, both part of the Sony Group Corp., accepting the modifications proposed by the companies to the deal they had announced last December. CCI granted approval with `certain modifications` to the proposed merger of Zee Entertainment Enterprises (ZEE) and Bangla Entertainment (BEPL) with Culver Max Entertainment (CME), formerly known as Sony Pictures Networks India.

JSW Energy jumped 12.79% after the company said that its wholly-owned subsidiary, JSW Neo Energy, has entered into a Memorandum of Understanding (MoU) with the Maharashtra Government for setting up a 960 megawatt (MW) capacity hydro pumped storage project (PSP) viz. Pane (Raigarh) pump storage project in the state of Maharashtra.

Godrej Consumer Products slumped 4.75%. The company said that the Indian FMCG industry continued to remain soft during the quarter. In India, the company expects to deliver close to double-digit growth during the quarter and a mid-single-digit volume drop, with a low single-digit 3-year volume CAGR.

Persistent Systems jumped 7.93% to Rs 3558.85 after a foreign broker reportedly upgraded the stock to `overweight` from `neutral` with a revised price target of Rs 4,100.

Atul Auto surged 4.27% after the company said its board will consider fund raising on 8 October 2022.

Manali Petrochemical rose 3.61%. The company`s project for augmenting Propylene Glycol capacity in Plant 2 received Environmental Clearance in India on 6 October 2022. The project will be implemented in two phases and the first phase would be completed within 18-21 months of receipt of the other regulatory approvals.

Primary Market:

The initial public offer (IPO) of Electronics Mart India was subscribed 7.45 times. It received bids for 46.54 crore shares as against 6.25 crore shares on offer, according to stock exchange data 16:51 IST on Thursday (6 October 2022).

The issue opened for bidding on 4 October 2022 and it will close on 7 October 2022. The price band of the IPO is fixed at Rs 56-59 per share. An investor can bid for a minimum of 254 equity shares and in multiples thereof.

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