Stocks gain for fifth day in a row; Paytm, Jubilant FoodWorks slump

Benchmark indices ended with strong gains, extended their winning run to fifth trading session. Shares of sugar makers saw buying demand. Shares of Paytm and Jubilant FoodWorks dropped sharply.

The S&P BSE Sensex, advanced 935.72 points or 1.68% at 56,486.02. The Nifty 50 index gained 240.85 points or 1.45% at 16,871.30. In five trading sessions, Sensex has rallied 6.89% while Nifty has gained 6.36%.

In broader market, the S&P BSE Mid-Cap index rose 0.02% while the S&P BSE Small-Cap index added 0.31%. The market breadth was even. On the BSE, 1,749 shares rose and 1,725 shares fell. A total of 138 shares were unchanged.

Economy:

The wholesale price-based inflation (WPI) in February 2022 rose to 13.11% on hardening of prices of crude oil and non-food items, despite softening of food articles. As per the government data released on Monday, the WPI inflation has remained in double digits for the 11th consecutive month beginning April 2021. Inflation last month stood at 12.96%, while in February last year, it was 4.83%.

Inflation in food articles, however, eased to 8.19% in February from 10.33%. Vegetable inflation was 26.93% in February, against 38.45% in the previous month. Inflation in manufactured items was 9.84% in February, against 9.42% in January. In the fuel and power basket, the rate of price rise was 31.50% during the month.

Buzzing Segment:

Shares of sugar makers saw buying demand amid buzz that auto makers have committed to produce flexible-fuel vehicles in six months. The flex engines will be run on 100% bio-ethanol and are expected to boost demand.

Dhampur Sugar Mills (up 19.51%), Avadh Sugar & Energy (up 12.74%), Triveni Engineering & Inds (up 10.06%), DCM Shriram (up 6.05%), Sakthi Sugars (up 5%), Balrampur Chini Mills (up 3.12%), EID Parry (India) (up 2.2%) and Andhra Sugars (up 1.74%) saw buying demand.

Stocks in Spotlight:

One97 Communications (Paytm) tumbled 12.84%.The Reserve Bank of India (RBI) directed Paytm Payments Bank to stop, with immediate effect, onboarding of new customers. The bank has also been directed to appoint an IT audit firm to conduct a comprehensive system audit of its IT system. Paytm Payments Bank is one of the payment instruments of Paytm.

Jubilant FoodWorks slumped 12.27%. The pizza maker said that the board of directors has accepted the resignation of Pratik Rashmikant Pota as the CEO and wholetime director of the company as he wishes to pursue opportunities outside the firm.

HDFC Bank gained 3.25% after the Reserve Bank of India (RBI) lifted the restrictions on sourcing of new credit cards. On 11 March 2022, the RBI had lifted the restrictions on the business generating activities planned under the bank`s Digital 2.0 program. In December 2020, RBI directed HDFC Bank stop all launches of its upcoming digital business-generating activities and sourcing of new credit card customers after repeated outages at its data centre which impacted operations.

Larsen & Toubro (L&T) rose 1.13% to Rs 1,747.30. The construction firm announced that The Gujarat Water Infrastructure (GWIL) has placed engineering, procurement and construction orders to the company for the design and construction of the Dhanki-Navda Bulk Pipeline project in Gujarat.

Zydus Lifesciences fell 1.37%. The pharmaceutical major received the final approval from the US-based drug regulator, the United States Food & Drug Administration (USFDA) to market Colestipol Hydrochloride tablets (in the strength of 1mg). Colestipol hydrochloride tablets are indicated as adjunctive therapy to diet for the reduction of elevated serum total and LDL-C in patients with primary hypercholesterolemia (elevated LDL-C) who do not respond adequately to diet.

Power Mech Projects advanced 1.28% after the company received a letter of award (LoA) worth Rs 2,120 crore. The company has won the new orders under Phase-III projects in 2,120 villages of Pratapgarh, Fatehpur and Meerut districts in Uttar Pradesh. Major components of the project are about 2,100 tube wells, 2,100 water tanks, and 13,000 km of pipeline network for supply of drinking water to about 50 lakh population.

PNC Infratech gained 1.99%. The EPC company said that it has been declared the L-1 (lowest) bidder for a NHAI project. The project involves four laning of NH 530B from Gaju Village (Mathura - Aligarh District Boundary) to Devinagar Bypass of SH-33 (NH-530B) in the State of Uttar Pradesh on hybrid annuity mode (HAM). The project bid cost is Rs 738 crore. The project is to be constructed in 24 months and operated for 15 years post construction.

Krsnaa Diagnostics slipped 1.52% after the company informed that Shivananda Rao has tendered his resignation from the post of chief operating officer (COO) of the company. The company`s COO has resigned due to personal reasons. The resignation is effective from closing of business hours on Monday, 14 March 2022.

Numbers to Track:

The yield on 10-year benchmark federal paper fell to 6.854% as compared with 6.855% 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 76.515, compared with its close of 76.44 during the previous trading session.

MCX Gold futures for 5 April 2022 settlement fell 1.09% to Rs 52,304.

The US Dollar index (DXY), which tracks the greenback`s value against a basket of currencies, fell 0.28% to 98.907.

In the commodities market, Brent crude for May 2022 settlement fell $4.22 or 3.75% to $108.45 a barrel.

Global Markets:

European markets traded higher while Asian stocks closed on a mixed note on Monday as investors monitor a Covid wave in China. Meanwhile, oil prices continued to be volatile amid the Russia-Ukraine war.

Investors continued watching developments on the Russia-Ukraine war, which is disrupting shipping and air freight. Elsewhere, markets also monitored a recent wave of Covid infections in China � including the major city of Shenzhen.

U.S. stocks dropped on Friday as the ongoing Russia-Ukraine conflict continued to unnerve investors. The U.S. government will revoke Russia`s most-favored nation trade status amid the conflict, the White House said Friday, noting that it will work with Group of Seven (G7) countries and the European Union to roll out new sanctions.

In U.S. economic reports, data from the University of Michigan consumer sentiment survey showed a fall to an initial March reading of 59.7 from February`s level of 62.8.

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