13th October 2020’s Highlights: Markets end flat, IMF on India’s GDP, Vedanta’s press release, and more.
-13th October 2020-
Sensex 40,625.51 ▲ 0.08%
Nifty 11,934.50 ▲ 0.03%
The markets ended up by a small margin today. The market movement today indicates a state of indecision after a rally seen in the last two weeks.
The day opened with the markets going up first, then down for some part of the day, and then recovering to end the day more or less flat. Banking shares pulled the market downward, and had it not been for late buying in Reliance Industries, the Nifty50 could have ended in the negative. Among the index stocks, HCL Tech (+4%), Infosys (+2.4%) and Kotak Mahindra Bank (+2.1%) were the top gainers whereas, Cipla (-3.5%), Titan (-2.5%) and Adani ports (-2.5%) were the top losers.
Top Gainers (Nifty)
HCL Tech - Rs 900.45 ▲ 3.94%
Kotak Mahindra Bank - Rs 1344.95 ▲ 2.44%
Infosys - Rs 1158.00 ▲ 2.27%
Reliance - Rs 2280.70 ▲ 1.95%
UltraTech Cement - Rs 4382.75 ▲ 1.78%
Top Losers (Nifty)
Cipla - Rs 788.25 ▼ 3.25%
Titan - Rs 1228.85 ▼ 2.22%
Adani Ports - Rs 349.90 ▼ 2.17%
Sun Pharma - Rs 503.15 ▼ 2.09%
ICICI Bank - Rs 396.15 ▼ 1.91%
Here are the top stories of the day.
Wipro Posts Fall in Net Profit; Board Announces BuyBack
Wipro posted a 3.4% fall in consolidated net profit to Rs 2,465.70 crores in the July-to-September quarter as compared to the same quarter in the previous financial year.
Revenue of the company fell 0.07% to Rs 15,114.5 crores in the same quarter.
The company's board also approved a buyback proposal worth up to Rs 9,500 crores. Wipro will buy back 23.75 crore shares at Rs 400 per share.
The shares of the company fell 0.41% to Rs 375.95 per share.
What is share buyback?
Share buybacks are one-way companies pay back extra cash they hold to investors. By buying back shares, the company is reducing the supply of shares in the markets and therefore increasing the scarcity of the stock.
IMF Sees Contraction in 2020, Expansion in 2021
According to the latest release by the International Monetary Fund (IMF), India’s GDP will contract by 10.3% in the year 2020.
The global rate of contraction in 2020 is projected to be 4.4%.
The same release projects that India will see a sharp increase in growth in the year 2021 at 8.8%.
This figure is higher than what the IMF projected for India earlier in June this year.
Vedanta's Statement Post Delisting Failure
After the company's delisting bid failed, it said in a statement today that it will now strive to grow stronger as a listed company.
Vedanta's delisting bid failed as some of the shares in the delisting process were not validly tendered. It needed at least 134 crore shares whereas only 125 crore shares were validly tendered.
"We saw enthusiastic participation by our shareholders that took us within striking distance of our goal, short by only 7%," it said in a statement.
The delisting bid would have resulted in an FDI inflow of over $3.15 billion into the Indian economy, the company added.
The shares of the company rose 2.78% to Rs 99.65 per share.
HCL continues upward march ahead of Q2 results
HCL Tech hit yet another record high ahead of its Q2 results, which will be declared this Friday (16 October). In its mid-quarter update in September, the company had mentioned that it expects quarter-on-quarter revenue growth to exceed 3.5% on constant currency terms. Further, it also said that the order pipeline looked healthy across verticals and geographies. This upbeat outlook has triggered buying interest even in other IT stocks, which were moving sideways for nearly two months until mid-September. TCS, Infosys, Wipro and HCL Tech have risen 19%, 23%, 28% and 25%, respectively since HCL’s mid-quarter update.
Cement stocks gain amid a tepid market
It seems that investors are turning their attention to this cement sector. The optimism rides on hopes of recovery in demand after the disruption during the pandemic. The market expects a better demand scenario in the northern, central and eastern regions thanks to pent-up demand and improved rural demand. Today, most major cement stocks closed on a positive note, with gains ranging from 0.3% to 3.4%, especially in the backdrop of a lacklustre market. Meanwhile, JK Cement—a north-India-focused player—hit a new lifetime high today and has already gained about 13% this month. The company recently expanded its cement production capacity by 4.2 million tonnes per annum, which is expected to help long-term volume growth.
Siti Networks default weighs on Zee Entertainment
Siti Networks, a cable TV service provider and one of the subsidiaries of Zee Entertainment, recently defaulted on loans worth nearly ₹400 crore. Siti’s shares are down about 26% this month, and the trickle-down effect was seen on Zee. As per reports, the default could result in a ₹200 crore loss for Zee. The company could lose ₹120 crore as corporate guarantor and another ₹81.2 crore in the form of subscription receivables. Zee shares were down 3.7% today and have fallen nearly 13% in October.
Closing bell
The non-stop rally of the past two weeks has halted, and it seems that investors are taking cognisance of the higher-than-expected inflation figures. This was evident in the banking shares, with the Nifty Bank index falling 0.9%. The stock-specific, result-related activity is likely to continue for a few more weeks. This trend was seen in the IT and cement stocks, which were on a roll in an otherwise muted market.
🥇 Gold: Rs 50,979 ▼ 0.25% at 6 PM
🥈 Silver: Rs 62,757 ▼ 1.13% at 6 PM
🔀 USD-INR Rate: Rs 73.36/USD ▲ 0.12%
Dow Jones: 28,837.52 ▲ 0.88% - Oct 12
Nasdaq: 11,876.26 ▲ 2.56% - Oct 12
HAPPY INVESTING
SEE YOU TOMORROW
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