The benchmark indices ended with decent gains on Wednesday, led by strength in IT shares. The Nifty closed above the 15,850 mark. Banks and financials stocks were under pressure.
The barometer index, the S&P BSE Sensex, rose 134.32 points or 0.25% to 52,904.05. The Nifty 50 index added 41.60 points or 0.26% to 15,853.95.
In the broader market, the BSE Mid-Cap index rose 0.21% and the BSE Small-Cap index gained 0.24%.
The market breadth was positive. On the BSE, 1797 shares rose and 1444 shares fell. A total of 137 shares were unchanged.
COVID-19 Update:
Total COVID-19 confirmed cases worldwide stood at 18,77,98,855 with 40,48,942 deaths. India reported 4,29,946 active cases of COVID-19 infection and 4,11,408 deaths while 3,01,04,720 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.
India reports 38,792 COVID-19 cases, deaths up by 624 in last 24 hours, said the Union Health and Family Welfare Ministry data on Wednesday. A decrease of 2,832 cases has been recorded in the active COVID-19 caseload in a span of 24 hours.
Economy:
India's annual rate of inflation based on the Wholesale Price Index (WPI) stood at 12.07% in June 2021 (over June 2020) compared with (-)1.81% in June 2020 and 12.94% in May 2021.
The high rate of inflation in June 2021 is primarily due to low base effect and rise in prices of mineral oils viz. petrol, diesel (HSD), naphtha, ATF, furnace oil etc., and manufactured products like basic metal, food products, chemical products etc. compared with the corresponding month of the previous year.
Meanwhile, the S&P Global Ratings on Tuesday, 13 July 2021 affirmed India's sovereign rating at the lowest investment grade of 'BBB-' for the 14th year in a row with a stable outlook, and said that the country's strong external settings will act as a buffer against financial strains despite elevated government funding needs over the next 24 months. The sovereign credit ratings on India reflect the economy's above-average long-term real GDP growth, sound external profile, and evolving monetary settings, S&P Global Ratings stated.
Numbers to Watch:
The yield on 10-year benchmark federal paper rose to 6.111% as compared with 6.103% 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 74.59, compared with its close of 74.4950 during the previous trading session.
MCX Gold futures for 5 August 2021 settlement rose 0.32% to Rs 48,040.
The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, fell 0.09% to 92.66.
In the commodities market, Brent crude for September 2021 settlement fell 59 cents at $75.90 a barrel. The contract rose $1.33, or 1.77% to settle at $76.49 a barrel in the previous trading session.
Foreign Markets:
Shares in Europe and Asia declined across the board on Wednesday following a hotter-than-expected U.S. inflation report for June overnight.
Singapore's economy grew 14.3% year-on-year in the second quarter, official advanced estimates showed Wednesday. Still, the economy contracted by 2% as compared with the previous quarter, Singapore's Ministry of Trade and Industry said.
US stocks slipped after posting new highs on Tuesday as the biggest hike in U.S. inflation in 13 years rattled investors.
US inflation rose at its fastest pace in nearly 13 years, the Labor Department reported Tuesday. The consumer price index increased 5.4% in June from a year ago. Core CPI, excluding food and energy, jumped 4.5%, the sharpest move for that measure since September 1991.
Federal Reserve Chairman Jerome Powell is scheduled to appear in front of Congress Wednesday and Thursday to provide an update on monetary policy.
Investors are also monitoring the spread of the more contagious delta variant of COVID-19, which is hampering the recovery from the pandemic in some parts of the world. The unfolding earnings season is key too, with global stocks close to record highs on optimism over the bounce back from the health crisis.
Buzzing Index:
The Nifty IT index jumped 3.16% to 29,339.85. The index fell 1.08% in the past three sessions.
Mphasis (up 8.17%), Wipro (up 6.99%), Coforge (up 4.85%), Larsen & Toubro Infotech (up 4.83%), Oracle Financial Services Software (up 3.73%), Tech Mahindra (up 2.56%), HCL Technologies (up 2.06%) advanced.
Infosys rose 2.07%. The IT major's consolidated net profit grew 2.3% to Rs 5,195 crore on 6% increase in revenue to Rs 27,896 crore in Q1 June 2021 over Q4 March 2021. On a year-on-year basis, net profit rose 22.7% and revenue increased 17.9% in Q1 June 2021.
Revenues in constant currency (CC) terms grew by 16.9% YoY and 4.8% quarter-on-quarter (QoQ). Large deal flows remained strong with total contract value (TCV) of $2.6 billion in Q1 FY22.
Infosys said its operating margin for the quarter was robust at 23.7%, an increase of 1% YoY and decline of 0.8% QoQ. Free Cash Flows (FCF) grew by 15.2% YoY to Rs 6,363 crore in Q1 FY22.
Mindtree jumped 8.06%. The IT company reported strong Q1 results after market hours Tuesday (13 July). The counter hit a record high of Rs 2,692.80 in intraday today.
The IT company reported an 8.2% increase in net profit to Rs 343.40 crore on an 8.6% rise in revenues to Rs 2,291.70 crore in Q1 FY22 over Q4 FY21. In dollar terms, the company posted 7.5% rise in consolidated net profit to $46.5 million on 7.7% increase in revenues to $310.5 million in Q1 FY22 over Q4 FY21.
EBITDA in Q1 FY22 rose 0.4% to Rs 464.50 crore as against Rs 462.60 crore posted in Q4 FY21. EBITDA margin was at 20.3% as on Q1 FY22 compared with 21.9% in Q4 FY21 and 18.2% in Q1 FY21.
In Q1 FY22, Mindtree reported highest ever order book of half-a-billion US dollars, registering a growth of 34.2% QoQ. The total active clients at the end of June 2021 stood at 260, down from 270 clients at the end of March 2021.
TCS rose 0.84%. The IT major on Wednesday announced plans to expand its operations in Arizona, investing more than $300 million by 2026 and hiring more than 220 employees by 2023, to meet the digital transformation needs of its customers. TCS will also continue to expand the reach of its STEM and Computer Science education programs in Arizona by increasing teacher training and online contentfor students over the next two years.
Stocks in Spotlight:
Oil and Natural Gas Corporation (ONGC) rose 0.33% while GAIL (India) shed 0.64%. ONGC has signed a five-year gas sale and transportation agreement with Gail India for sale of 90% of its domestic gas produce at domestic price.
NBCC (India) shed 1.01%. The company has secured total business of Rs 206 crore in the month of June 2021.
Tata Metaliks jumped 3.46%. The company's standalone net profit stood at Rs 94.72 crore in Q1 June 2021 (Q1 FY22) compared with net loss of Rs 12.36 crore in Q1 June 2020 (Q1 FY21). Revenue from operations surged 187.21% to Rs 602.97 crore in Q1 FY22 as against Rs 209.94 crore in Q1 FY21.
Hindustan Zinc added 0.03%. The company's mined metal production for Q1 FY22 was 221,000 tonnes, up 9% from 202,000 tonnes in Q1 FY21. The increased production was mainly on account of higher ore production largely at Rampura Agucha mines (RAM) and Zawar mines. This was partially offset by lower overall metal grades.
The mined metal production decreased 23% in Q1 FY22 from 288,000 tonnes in Q4FY21, mainly due to lower ore production at Sindesar Khurd & Rampura Agucha mines due to operators' absenteeism in April & May in light of second wave of COVID-19.
India Grid Trust rose 0.72%. The Infrastructure Investment Trust (InvIT) announced the completion of acquisition of 100% stake in two solar assets with cumulative capacity of 100 MW from Fotowatio Renewable Ventures at an enterprise value of Rs 660 crore.
With this acquisition, the company's asset portfolio will now consist of fourteen diversified power projects consisting of 40 transmission lines,11 substations (13,550 MVA capacity) and 100 MW of solar power plants across 18 states and one Union Territory. IndiGrid's acquisition of its first solar asset is an important milestone in the Indian infrastructure sector as this marks the first renewable energy acquisition by any InvIT in the country.
Zuari Agro Chemicals advanced 2.11%. The company said its single super phosphate (SSP) plant in Mahad (Maharashtra) has resumed operations with supply of raw materials having been tied up with a supplier. Zuari Agro Chemicals has further intimated that the NPK A plant has been shut down due to unavailability of raw materials. The company will inform once the plant resumes operations.
Vedanta gained 0.18%. The company said its total aluminum production grew 17% to 5,49,000 tonnes in Q1 FY22 compared with 4,69,000 tonnes in Q1 FY21. In zinc (India), integrated metal production was 236,000 tonnes for Q1 FY22, up 17% as compared to Q1 FY21 in line with higher availability of mined metal and down 8% as compared to Q4 FY21 on account of lower mined metal production.
In zinc (international), total production for Q1 FY22 was 61,000 tonnes, higher by 62% as compared to Q1 FY21 mainly due to higher Gamsberg production due to ramp up and COVID lockdown restrictions which were in place in Q1 FY21. Q1 FY22 production was higher by 10% as compared to Q4 FY21 due to 11% higher throughput.
In iron ore segment, there was no production at Goa due to suspension of mining pursuant to the Supreme Court judgement dated 7th February 2018 directing mining operations of all companies in Goa to stop with effect from 16th March 2018. At Karnataka, production volume in Q1 FY22 was 1.4 million tonnes, higher by 53% as compared to Q1 FY21 and 24% sequentially. Pig iron production was at 2,02,000 tonnes in Q1 FY22, higher by 85% as compared to Q1 FY21 and 29% sequentially.
In oil & gas segment, average gross operated production during Q1 FY22 across our assets was 164,899 barrels of oil equivalent per day (boepd), up 4% compared to Q1 FY21 and at similar levels as compared to Q4 FY21.
In steel segment, total saleable production for Q1 FY22 was 289,000 tonnes, higher by 8% as compared to Q1 FY21, mainly due to COVID-19 restrictions in Q1 FY21. In comparison to Q4 FY2021, total saleable production was down by 9% mainly due to instabilities and hanging issues at blast furnace.
In power segment, during Q1 FY22, power sales were 2,722 million units higher by 48% as compared to Q1 FY21 and 19% lower as compared to Q4 FY21.
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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)
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