5 Factors Why Sensex Rose 680 Points, Mutual Fund Activity in October, and Top Buzzing Stocks Today

Wed, 11 Nov Pre-Open | Monish Vora, TM Team

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Indian share markets closed at record high levels yesterday.

Benchmark indices continued their momentum and ended higher for the seventh straight session on the back of progress in the development of a coronavirus vaccine.

At the closing bell yesterday, the BSE Sensex stood higher by 680 points (up 1.6%).

The NSE Nifty closed higher by 170 points (up 1.4%).

Bajaj Finance and IndusInd Bank were among the top gainers.

The BSE Mid Cap index ended down by 0.1%. The BSE Small Cap index ended down by 0.5%.

On the sectoral front, gains were largely seen in the banking sector and finance sector.

Gold prices were trading up by 1% at Rs 50,255 per 10 grams at the time of closing stock market hours yesterday.

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Speaking of the current stock market scenario, in her latest video, Co-head of Research at Equitymaster, Tanushree Banerjee talks about what you should expect from the stock markets this time.

She explains how you should prepare your stocks so that they could make the most of the Covid second wave.

Tune in to the video to find out more:

Top Stocks in Focus Today

JK Cement will be among the top buzzing stocks today.

JK Cement reported almost a three-fold jump in consolidated net profit at Rs 2.2 billion for the quarter ended September. The company's revenue from operations rose 24% year-on-year (YoY) to Rs 16.3 billion during the quarter whereas its total expenses rose 11.5% YoY to Rs 13.3 billion.

The company is expecting to further improve its growth numbers in the second half of this current fiscal, riding on enhanced production capacity and resurgence in demand.

The company has also successfully completed its grey cement capacity expansion of 4.2 MTPA (million tonnes per annum) comprising 2 MTPA in Rajasthan, 1.5 MTPA in Uttar Pradesh and 0.7 MTPA in Gujarat.

M&M share price will also be in focus as the company reported an 88% year-on-year (YoY) fall in Q2FY21 net profit for M&M and Mahindra Vehicle Manufacturers Ltd (MVML) at Rs 1.6 billion against Rs 13.5 billion reported in Q2FY20. Revenue (M&M + MVML) for the said quarter came at Rs 115.9 billion, up 6% YoY against Rs 109.3 billion in Q2FY20.

On a consolidated basis, M&M's revenue from operations for Q2FY21 stood at Rs 235.6 billion against Rs 239.3 billion YoY.

Market participants will also track TCS share price as the company is acquiring Postbank Systems AG from Deutsche Bank AG. The deal value is not disclosed yet.

Postbank Systems AG provides IT services to Deutsche Bank. TCS will acquire 100% of the shares of Postbank Systems and its 1,500 employees will become part of TCS. The technology is based in Germany and will help TCS expand its presence in the region.

The transaction is subject to both parties finalising further agreements by year-end-2020 and is subject to regulatory and governmental approvals.

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Top 5 Reasons Why Sensex and Nifty Closed at Record High Levels Yesterday

Covid-19 Vaccine Hopes: Stock markets around the globe got a boost after Pfizer said its Covid-19 vaccine, developed with German partner BioNTech SE, was more than 90% effective in preventing infection, marking the first successful results from a large-scale clinical trial.

Rally in Banking and Financial Stocks: Gains were seen as banking and financial stocks rose and gave a boost to the benchmark indices. Banking and finance stocks are seen rallying on improved business outlook post Q2FY21 results, end to moratorium, and improvement in economic activities. Both, banking and finance sector rose more than 3.5% in yesterday's session.

Improving Macroeconomic Data: Signs of improvement on the macroeconomic front also boosted stock market sentiment. Positive macroeconomic data on core sector growth, rebound in GST revenues, and robust power demand is driving economic recovery.

Strong Q2FY21 Earnings: Indian stock markets are seen rising on the back of favorable September quarter result announcements from most companies.

US Fed Stimulus: Stock markets also rose on news about more stimulus measures from the US government. Dallas Federal Reserve Bank President Robert Kaplan said the US economy is rebounding from a deep contraction, but the resurgence of Covid-19 poses downside risks. Cleveland Federal Reserve Bank President Loretta Mester said the emergency lending programs the Fed set up during the coronavirus pandemic are still needed.

We will keep you updated on how these factors develop in the coming days and what effect they have on Indian stock markets. Stay tuned!

Mutual Fund Industry Assets at Record High; Debt Schemes See Strong Inflows

In news from the mutual funds space, strong inflows in debt schemes lifted mutual fund industry assets to a record high at Rs 28.2 lakh crore at the end of October. However, this rise was partially limited by outflows from equity funds, data from mutual fund industry body AMFI showed.

With a net inflow of Rs 1.1 lakh crore in debt schemes and a net outflow of Rs 27.2 billion from equity funds, the fund industry recorded an overall positive flow of Rs 985.7 billion in October.

After showing a declining trend for seven consecutive months, systematic investment plan (SIP) inflows showed a marginal uptick during October. Monthly contribution from SIPs was at Rs 78 billion, up marginally from Rs 77.8 billion in September. At the end of the month, total SIP AUM rose to a little over Rs 3.4 lakh crore.

In the debt segment, the surge in assets came mainly from liquid, money market, short duration, corporate bond and ultra-short duration funds. On the equity side, while sectoral & thematic funds witnessed net flows, multi-cap and value & contra funds witnessed outflows.

Multi-cap funds saw outflows as the stock market regulator-imposed deadline for these schemes to rejig their portfolio neared.

How these numbers pan out in coming months remains to be seen. Meanwhile, we will keep you updated on all the latest developments from this space.

And to know what's moving the Indian stock markets today, check out the most recent share market updates here.

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