Market expected to be very volatile with first half of the year likely to be on more downside and impact of COVID19 would be known in next few months
Bouncing back from the previous session’s gains, domestic equity market benchmarks Sensex and Nifty started the financial year 2020-21 on a negative note, down 2 per cent on Wednesday, taking cues from the weak global cues. The 30-share index Sensex was down 658 points or 2.24 per cent to 28,809, while the broader Nifty 50 index was ruling at 8417, down 191 points or 2.22 per cent. “Traders should align their positions keeping in mind the prevailing scenario. On the other hand, investors should not worry much about the daily fluctuations and maintain their focus on accumulating quality names in a phased manner,” Ajit Mishra, VP – Research, Religare Broking Ltd said.
IndusInd Bank emerges as top Sensex gainer: Paring opening gains, IndusInd Bank share price was up 2 per cent to Rs 358 a piece on BSE on Wednesday after the promoters made full loan repayment to Citi Bank. HUL and Power Grid were other Sensex gainers today. While Kotak Mahindra Bank was the top Sensex loser, down 8.19 per cent, followed by SBI, HDFC Bank.
Nifty FMCG index holds ground- Barring NIfty FMCG index and Nifty Realty index, all the sectoral indices were trading lower in Wednesday’s trade. Nifty Bank index was down 2.21 per cent weighed by Kotak Mahindra Bank, SBI and HDFC Bank. While Nifty FMCG index was up nearly a per cent led by gains in Godrej Consumer Products, Britannia and Emami.
PSU banks merger to come into effect from today- Meeting the schedule for the amalgamation, the merger scheme for all the 10 public sector lenders into four bigger and stronger banks will come into force on April 1. The Reserve Bank of India, on Saturday said all branches of Oriental Bank of Commerce and United Bank of India will function as branches of Punjab National Bank, the anchor bank, from April 1. Similarly, all branches of Allahabad Bank will function as branches of Indian Bank from that day, while all branches of Andhra Bank and Corporation Bank will function as branches of Union Bank of India from April 1, according to a PTI report.
Global markets- Asian shares fell on Wednesday as the coronavirus sharply slows global growth. Japan’s Nikkei fell 1.86% in early trade. MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.35% in early trade. Overnight on Wall Street, all three major indices tumbled. The Dow Jones Industrial Average fell 410.32 points, or 1.84%, to 21,917.16, the S&P 500 lost 42.06 points, or 1.60%, to 2,584.59 and the Nasdaq Composite dropped 74.05 points, or 0.95%, to 7,700.10.
Markets outlook for FY21- Analysts see equity markets to remain volatile in the financial year 2020-21. “Market expected to be very volatile with first half of the year likely to be on more downside and impact of COVID19 would be known in next few months. In the second half, we would see a good recovery but reaching all time high would be very difficult in FY21. However, by FY22 we can possibly see all time high. FMCG, IT, Pharma and Retail segment would be fast to recover post May 2020 correction,” A K Prabhakar, Head of Research, IDBI Capital said.
Coronavirus cases near 1,400 mark- The total number of coronavirus cases in India has reached 1,397, including 1,238 active cases, while 124 people have been cured or discharged. According to the Ministry of Health and Family Welfare, a total of 35 people have died so far. The cases in National Capital, Delhi, have risen to 97.
Govt misses disinvestment target- The government has missed the collection target for the financial year 2019-20 from CPSE disinvestment set in the Revised Estimates of Budget by about Rs 14,700 crore. In FY20, the actual disinvestment mop-up has come in at Rs 50,298.64 crore.