Market Hightlights: Sensex ends 415 pts up; banks, financials gain after RBI announces liquidity facility for MFs

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Updated:Apr 27, 2020 6:17:43 pm

Share Market News Today | Sensex, Nifty, Share Prices Highlights: Out of 30 stocks that constitute the S&P BSE Sensex, 26 scrips ended the session in green today with IndusInd Bank as top gainer up over 6 per cent, followed by Axis Bank, Kotak Mahindra Bank, ICICI Bank .

Share Market Today, Share Market LiveAll the Nifty sectoral indices traded in green throughout the day. Nifty Private Bank was top sectoral gainer, up 3 per cent led by gains in RBL Bank

Share Market News Today | Sensex, Nifty, Share Prices Highlights: Indian stock market posted gains on Monday as financial and bank stocks jumped after the Reserve Bank of India’s (RBI’s) announcement of special liquidity facility (SLF) for mutual funds of Rs 50,000 crore. BSE Sensex advanced 415 points or 1.33 per cent to 31,743, while the broader Nifty 50 index soared 128 points or 1.40 per cent to end the session at 9282. Out of 30 stocks that constitute the S&P BSE Sensex, 26 scrips ended the session in green today with IndusInd Bank as top gainer up over 6 per cent, followed by Axis Bank, Kotak Mahindra Bank, ICICI Bank and Bajaj Finance. On the flip side, just four stocks NTPC, Mahindra & Mahindra (M&M), HDFC Bank and Bharti Airtel closed in red. All the Nifty sectoral indices traded in green throughout the day. Nifty Private Bank was top sectoral gainer, up 3 per cent led by gains in RBL Bank, IndusInd Bank and Kotak Mahindra Bank. Nifty FMCG index too advanced 415 points driven by Tata Consumer Products, Britannia and UBL.

The Reserve Bank of India on Monday, stepped forward with a Rs 50,000 crore rescue plan to save mutual funds, days after Franklin Templeton wound up six of its debt and credit schemes with an aggregate AUM (Asset Under Management) of Rs 36,000 crore. RBI said that it has taken note of the heightened volatility in capital markets, after the coronavirus breakout, and acknowledged that the volatility has imposed liquidity strains on mutual funds. The liquidity crunch at fund houses has intensified in the wake of redemption pressures related to the closure of some debt mutual funds.

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Highlights

    15:49 (IST)27 Apr 2020
    All sectors participated in today's rally which was led by Private banks and IT

    Stocks in the Chemical sector are showing momentum on the basis of expectation of an increase in demand due to the shifting of chemical plants from China. Market Breadth was in favor of the Bulls. For every loser, there were a couple of gainers. All sectors participated in today's rally which was led by Private banks and IT. India VIX contracted further by more than 2.8%, remained just above 38 levels. Going forward, Nifty will find support around 9150 levels, and resistance will be around 9376-9390 levels. Above 9400 one can see levels of 9460-9510. Below 9150 it is open for the levels of 8900-8800, says Vishal Wagh, Head of Research, Bonanza Portfolio Ltd.

    15:21 (IST)27 Apr 2020
    This credit risk mutual fund lost half of NAV; fund head still not excited about RBI liquidity offer

    After the Franklin Templeton liquidity crisis came into light, the net asset value (NAV) of three BOI AXA credit risk funds fell by 50 per cent in a single day on Friday last week. The fund house wrote down its entire holding in Dewan Housing Finance Corp Ltd (DHFL) and Avantha Holdings. Also, it marked down its exposure to Dinram Holdings Private Ltd and Amantha Healthcare. Taking cognizance of the liquidity issue in the mutual fund industry, Reserve Bank of India (RBI) tried to calm the investors’ nerves by announcing a special liquidity facility for mutual funds worth Rs 50,000 crores. However, despite a massive plunge in the NAV of BOI AXA credit risk funds, the fund house doesn’t seem to be keen on borrowing from RBI’s special liquidity facility.

    Read full story

    15:05 (IST)27 Apr 2020
    RBI's move more of a confidence-boosting measure

    This is more of a confidence-boosting measure. Most debt MFs invest in AA or higher rated paper and A or below is a very small part of their portfolios. There is enough liquidity in the market for a good quality paper. However, it was important for RBI to issue this communication and support to calm nerves. This should help settle some of the panics that was caused over the weekend over the FT news. Even in 2008 when this measure was introduced, none of the MFs actually utilised it. So this is more of a backstop, says Ashish Shanker, Head of Investments, Motilal Oswal Private Wealth Management.

    14:45 (IST)27 Apr 2020
    Franklin Templeton tries to calm mutual fund investors; here's what India head says about returning money

    Franklin Templeton’s top management, in an effort to reassure investors, said that it is committed to returning the money invested at the earliest. The fund house is trying to soothe investors after having closed six of its debt and credit mutual fund schemes. “We are committed to doing all we can to return monies in the schemes that are wound up at the earliest to investors, and to regain your trust in our brand,” Franklin Templeton Asset Management (India) President, Sanjay Sapre said in a note to investors. The fund house last week announced the closure of six schemes owing to redemption pressure and lack of liquidity in the secondary market.

    Read full story

    14:26 (IST)27 Apr 2020
    RBI's announcement a big plus for the industry

    The announcement is definitely a big plus for the industry and the move hints at providing a sigh of relief to the debt fund investors who were panicking and planning to withdraw their investments. Although, as an investor, you should still be cautious while staking your money on shares of AMCs and make sure that you choose only those companies which possess more quality debt instruments (AAA rated) in their portfolio, says Pranjal Kamra, CEO, Finology. 

    14:13 (IST)27 Apr 2020
    RBI's step a confidence booster for investors, mutual fund industry

    This is an unexpected yet crucial step taken up by RBI after the market witnessed a series of financial debacles that had taken almost a medium-term to understand what's happening in the industry. However, in the current scenario, RBI's move to provide liquidity to the high-risk debt mutual fund segment would be a confidence booster for the investors as well as for the mutual fund industry from succumbing into the negative sentiment. This will help the mutual funds to have a buffer to withstand the redemption pressures and would save the NAVs losing their value. With such quick steps being taken up by the government institutions, consumer confidence in the markets increases and the markets would revive their original trajectory without any panic selling and from further avalanche effects thereafter, says Ravi Singh, VP- Head of Research, Karvy Stock Broking.

    13:47 (IST)27 Apr 2020
    Sensex, Nifty gain 2 per cent

    BSE Sensex was trading at 31,936.03, up 608.81 points or 1.94 per cent, while the broader Nifty 50 index was ruling 184 points or 2 per cent up at 9,338.

    Check live Sensex, Nifty levels

    13:43 (IST)27 Apr 2020
    This many MSME loans are at higher risk of becoming NPAs in next 12 months: CIBIL

    MSME loans worth Rs 2.32 lakh crore are at a higher risk of becoming non-performing assets (NPA) as they fall in the highest risk category of 7 to 10, according to credit information firm TransUnion Cibil. The risk bracket is based on TransUnion Cibil’s solution Cibil MSME Rank (CMR) that assigns a ranking to MSMEs on a scale of 1 to 10 based on their credit history. A higher ranking suggests a greater risk of small business loans going bad in the coming 12 months. Out of Rs 2.32 lakh crore loans at risk, micro-enterprises having loans of less than Rs 10 lakh, in the highest risk category of CMR-7 to CMR-10, totals up to Rs 13,600 crore.

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    13:15 (IST)27 Apr 2020
    For the time being the sentiments may have stabilized

    For the time being the sentiments may have stabilized, but going by the way the corporate health could deteriorate due to the pandemic, there is some probability that RBI might have to step in again after a few weeks. In the meanwhile investors in debt mutual funds will do well to review the investment by the schemes in which they have invested and in case they feel the need, shift to safer (even if they yield lesser) categories of mutual fund schemes or in extreme cases other safer instruments including Bank FD (subject to limit of Rs.5 lakhs per Bank) or Govt savings schemes, says Deepak Jasani, Head Of Research, HDFC Securities.

    13:13 (IST)27 Apr 2020
    RBI's SLF will alleviate the fears in the minds of investors

    The RBI’s special package for providing liquidity to Mutual funds will alleviate the fears in the minds of investors and also dissuade many from getting into the redemption mode. It will help stabilize sentiments across debt and equity markets at least for a few days/weeks. For Mutual funds, this will be an additional window for liquidity. However, borrowing against the investment-grade paper for redemption may not be a good idea generally (except occasionally and for a limited period). Also, this will do little to halt the NAV hit due to possible downgrade of papers held by the Mutual funds due to the economic slowdown and the resultant sluggishness in economic activity emanating from the pandemic, says Deepak Jasani, Head Of Research, HDFC Securities 

    12:57 (IST)27 Apr 2020
    Watch out for telecom, insurance, healthcare stocks in post COVID-19 world | HDFC Securities Interview

    With social distancing and work-from-home becoming the new normal, the coronavirus lockdown is changing human behaviour and consumption patterns. A few sectors that might get their fair share of attention as a result of this change include; telecom, insurance, and healthcare, according to Devarsh Vakil, Head - Advisory, HDFC Securities.

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    12:51 (IST)27 Apr 2020
    By when BOI AXA credit risk fund's 50% NAV will be regained?

    As of now, we have a decent amount of cash, depending upon if we get redemptions. As of now, we don't see the need for borrowing. It all depends upon the market condition that how it shapes up. What RBI has enabled is a facility. Now there is another lag of it which is the bank. Mutual funds don't get access directly from RBI. This means that banks will have to borrow and banks are willing to lend. As of now, specifically, we don't have the requirement. Things getting stablised, markets are getting credit properly and when we start getting bids in our papers, we will accordingly adjust. It is difficult to put up a timeline right now because we are still in a lockdown situation and because of that lockdown trading hours have also been truncated and people are operating from homes. So, it is difficult to get credit limit on papers when everybody is operating from home, says Alok Singh, Chief Investment Officer, BOI AXA Investment Managers Ltd

    12:50 (IST)27 Apr 2020
    Will BOI AXA take RBI's SLF?

    We have liquidity and we are not in the borrowing mode. Mutual fund liability, unlike a bank where the liabilities are long term, here the liabilities are T 1 or maximum T 10 which means that the entire fund of yours can be redeemed at one day notice and the libailities in which you have invested in are the securities of various forms and tenure. Now, if supposedly, eveyone asks for the money today, can you liquidate the security today and sell? the answer is No. That's how the NAV should keep on adjusting accordingly. I don't see the need of borrowing, says Alok Singh, Chief Investment Officer, BOI AXA Investment Managers Ltd

    12:44 (IST)27 Apr 2020
    A decisive fall below 9,000 in the index would trigger fresh fall: Ajit Mishra, VP, Religare Broking

    Markets are constantly facing headwinds as the prevailing lockdown has completely derailed the economy and the news of a further delay in the stimulus package has further dampened the sentiment.  At the top of it, there’s no relief from the COVID-19 front as the numbers are not showing any signs of slowing down yet and that could result in further extension of the lockdown. In such a scenario, we doubt the recent rebound can extend further and Nifty would find it difficult to hold above 9,400. On the other hand, a decisive fall below 9,000 in the index would trigger fresh fall and we feel banking could lead that decline so traders should plan their positions accordingly: Ajit Mishra

    12:41 (IST)27 Apr 2020
    Raghuram Rajan’s prescription for ailing economy; says both lives, livelihoods are important

    As the government extended lockdown till 3rd May with speculations still rife that it might still not be over by next week, former RBI Governor Raghuram Rajan has said that the lockdown situation cannot persist forever as both lives and livelihoods are important. “It is not a stump choice — saving lives or saving livelihoods. You have to do both. On one hand, you can’t remain in a lockdown forever, as that would be focussing more on saving lives. But, in the process if people don’t have livelihoods, it may also impact their lives".

    Read full story

    12:15 (IST)27 Apr 2020
    No Income Tax at 40% rate for those earning over Rs 1 crore! CBDT trashes IRS officials report

    The Central Board of Direct Taxes has rejected a report by Indian Revenue Services (IRS) Officials that suggested to charge tax at 40 per cent to those earning over Rs 1 crore. In an official statement, the CBDT said, “The Central Board of Direct Taxes (CBDT) has said today that there is some report circulating on social media regarding suggestions by a few IRS officers on tackling COVID-19 situation

    Read full story

    12:02 (IST)27 Apr 2020
    JioMart to now deliver daily-use goods; RIL firm starts delivery in these select locations

    Within days of securing a deal with social-media company Facebook, RIL’s e-commerce app for groceries — JioMart — has gone live with the platform starting deliveries of essential commodities in select locations such as Navi Mumbai, Thane and Kalyan. The same was communicated to users in these places by a message by the company. Reliance Jio, a subsidiary of RIL, has recently made a pact with US-based Facebook which also runs Whatsapp in India.

    Read full story

    11:49 (IST)27 Apr 2020
    Top stock picks by Anand Rathi

    KNR Constructions, PNC Infratech and Ahluwalia Contracts. With their strong balance sheets, they are likely to emerge from this stronger than ever.

    11:48 (IST)27 Apr 2020
    Timely and extremely laudable action from RBI

    This (RBI's announcement) will serve to alleviate the fears in the minds of investors and also dissuade many from getting into the redemption mode. Even then, the after-effects of the low rated credit risk fund portfolios may haunt the mutual funds for some more time to come because of the economic slowdown and the resultant sluggishness in economic activity emanating from the pandemic. Timely and extremely laudable action from the RBI, says Joseph Thomas, Head of Research - Emkay Wealth Management

    11:47 (IST)27 Apr 2020
    RBI's SLF announcement to to bring back confidence

    The closure of its six debt schemes by FT has resulted in eroding the confidence of investors to a large extent. This usually results in more redemptions and may lead to liquidity problems for the mutual fund industry, when many of them already have negative cash in debt funds. So, more than a crisis of liquidity, it is a crisis of confidence. In order to bring back confidence, the RBI has announced the liquidity support measures for the mutual funds specifically, says Joseph Thomas, Head of Research - Emkay Wealth Management

    11:45 (IST)27 Apr 2020
    Add MinTree with target price at Rs 830: HDFC Securities

    We maintain our positive view on MindTree based on (1) Growth visibility in Hi-tech & Media and Retail, CPG, Mfg verticals ((2) Healthy pipeline, deal wins (highest-ever in 4Q) and minimal deal deferrals, and (3) Sustainability of operational stability. Target Price at Rs 830, HDFC Securities said in its latest research report. 

    11:37 (IST)27 Apr 2020
    Bank stocks gain up to 5% post RBI's SLF announcement

    Kotak Mahindra Bank jumped 5 per cent, Axis Bank (up 5 per cent), RBL Bank (3.8 per cent), IndusInd and ICICI Bank, gained up to 3 per cent each. Also. State Bank of India gained early 1.5 per cent after the RBI announced an SLF for mutual funds worth Rs 50,000 crore.

    11:37 (IST)27 Apr 2020
    Mutual Fund investors: RBI has your back, opens up money bags for fund houses to ease investor pain

    The Reserve Bank of India on Monday, stepped forward with a Rs 50,000 crore rescue plan to save mutual funds, days after Franklin Templeton wound up six of its debt and credit schemes with an aggregate AUM (Asset Under Management) of Rs 36,000 crore. RBI said that it has taken note of the heightened volatility in capital markets, after the coronavirus breakout, and acknowledged that the volatility has imposed liquidity strains on mutual funds. The liquidity crunch at fund houses has intensified in the wake of redemption pressures related to the closure of some debt mutual funds. "The stress is, however, confined to the high-risk debt Mutual Funds segment at this stage; the larger industry remains liquid,” a notification issued by the Reserve Bank said.Read full story

    11:32 (IST)27 Apr 2020
    Why did NAV of BOI AXA credit risk fund fall by 50% in a single day on Friday?

    We had adjusted the valuation of some of our securities, basically to reflect the illiquidity in the market. As the markets have become quite illiquid and to find a buyer at the price at which we were holding was not possible. So, the NAV has to reflect the realisable value of assets and in that principal we adjusted the NAV and that's why NAV got corrected, says Alok Singh, Chief Investment Officer, BOI AXA Investment Managers Ltd

    11:31 (IST)27 Apr 2020
    Mutual Fund investors: RBI has your back, opens up money bags for fund houses to ease investor pain

    The Reserve Bank of India on Monday, stepped forward with a Rs 50,000 crore rescue plan to save mutual funds, days after Franklin Templeton wound up six of its debt and credit schemes with an aggregate AUM (Asset Under Management) of Rs 36,000 crore. RBI said that it has taken note of the heightened volatility in capital markets, after the coronavirus breakout, and acknowledged that the volatility has imposed liquidity strains on mutual funds. The liquidity crunch at fund houses has intensified in the wake of redemption pressures related to the closure of some debt mutual funds.

    Read full story

    10:41 (IST)27 Apr 2020
    RBI's move much needed to ease liquidity stress on MF industry

    RBI decided to open a special liquidity facility for mutual funds of Rs 50,000 crores. "The move is much needed to ease the liquidity stress on the MF industry. However, as has been seen in the TLRTO auctions, lenders will be cautious of credit strength before using this facility provided by RBI. Having said that, there will definitely be easing of liquidity and this move should also boost investor sentiment," Karan Mitroo, Partner, L&L, told Financial Express Online.

    10:36 (IST)27 Apr 2020
    Sensex reclaims 32,000-mark

    Sensex reclaimed 32,000-mark in trade, Nifty jumped 210 points or 2.28 per cent to trade at 9,363 on Monday.

    Check live Sensex, Nifty levels

    10:33 (IST)27 Apr 2020
    Financial stocks gain in trade as RBI announces special liquidity facility for mutual funds

    Bajaj Finance, Axis Bank, IndusInd Bank, Bajaj Finserv gain in trade after Reserve Bank of India announced a special liquidity facility of Rs 50,000 crore for mutual funds.

    10:30 (IST)27 Apr 2020
    Nifty reclaims 9,350, Sensex jumps over 650 points on firm global cues; key things from trade today

    Bouncing back from the losses in the previous session, BSE Sensex and Nifty 50 were trading with nearly 2 per cent gains on Monday, mirroring the positive global cues. S&P BSE Sensex advanced 523 points or 1.67 per cent to 31,850, while the NSE’s Nifty reclaimed the crucial 9,300-mark. Reliance Industries, HDFC, Kotak Mahindra Bank and Infosys were among the top contributors to the index.

    Read full story

    10:11 (IST)27 Apr 2020
    RBI to open a special liquidity facility for mutual funds of Rs 50,000 crores

    RBI says with a view to easing liquidity pressures on Mutual Funds, it has been decided to open a special liquidity facility for mutual funds of Rs 50,000 crores. RBI shall conduct repo operations of 90 days tenor at the fixed repo rate, ANI reported. 

    10:06 (IST)27 Apr 2020
    Rupee is likely to trade range bound between 75.50-77 levels

    The rising number of COVID-19 cases domestically and a delay in the fiscal stimulus shall keep the overall sentiments fragile. Going forward, the rupee is likely to trade rangebound between 75.50-77.00 levels and dips are expected to be short-lived until positive changes in the fundamentals occur. This majorly includes the invention of the vaccine against Covid-19, containment in further spread of the virus and foreign inflows in Indian capital markets, says Amit Pabari, managing director, CR Forex Advisors.

    10:02 (IST)27 Apr 2020
    Buy Mindtree, target price: Rs 945 : Edelweiss

    Mindtree’s Q4FY20 numbers topped expectations—revenue, up 1.2% QoQ USD, outclassed Street’s 0.3% estimate while adjusted EBIT margin, up 150bps QoQ to 13.5%, also beat the forecast. Top-line growth was again driven by the top account while the Hi-tech vertical masked the softness in other verticals. The constant improvement in delivery capabilities is mainly due to almost zero supply-side snags in a quarter marred by operational challenges for the industry at large. Given its strong deal-wins (record USD393mn), Mindtree looks better positioned than mid-cap peers to weather the imminent near-term storm as demand may hit its nadir in H1FY21E. This coupled with an expanding margin trajectory, not to mention a strong USD (weak INR), underpins our unchanged 18x Q2FY22E EPS. The stock is trading at 17.6x FY21E EPS. Retain ‘BUY’ with a TP of INR945.

    09:51 (IST)27 Apr 2020
    Market outlook: Dharmesh Shah, Head – Technical, ICICI direct

    We believe any cool off from hereon due to global volatility should not be construed as negative instead it should be capitalised on as an incremental buying opportunity, as we expect intermediate correction would get anchored around key support threshold of 8800 as it is confluence of a) 38.2% retracement of ongoing pullback (9390 – 8055), placed at 8880 coincided with b) last weeks low is placed at 8822.Structurally, elongated uptrend along with abating downward momentum, supported by rejuvenating market breadth signifies structural improvement, auguring well for next leg of up move. Currently, index has witnessed the longest pullback in magnitude since life high of 12430. The current pullback off March low of 7511 is longer (1879 points or 25%) compared to mid-March pullback (1604 points or 19%). Looking at historical evidences (over past two decades, average correction to the tune of 40% - 45% offered an opportunity to construct long term portfolio), we advise investors that, elevated volatility in coming weeks should be capitalized to accumulate quality stocks in a staggered manner from minimum one year prospective.

    09:48 (IST)27 Apr 2020
    RIL top Sensex gainer, up nearly 4%

    RIL was top Sensex gainer with a growth of nearly 4 per cent to Rs 1,470 apiece on BSE. The market cap of Reliance Industries Ltd (RIL) zoomed Rs 1,21,904.63 crore to Rs 8,98,499.89 crore last week.

    Check live prices: RIL 

    09:45 (IST)27 Apr 2020
    MindTree share price gains over 8%

    MindTree share price gained over 8% to Rs Rs 842.30 apiece on BSE in Monday's opening deals. The stock price hit a day's high of Rs 854.70, while a low of Rs 814.20.

    Check live prices: MindTree

    09:40 (IST)27 Apr 2020
    Gold continued with positive momentum from last week

    Mcx gold continued with positive momentum from last week since Fed announced a fresh round of stimulus. The BOJ is expected to expand monetary stimulus for the second straight month aimed at combating the deepening economic fallout from the coronavirus pandemic. Another wave of states prepared to ease coronavirus restrictions on U.S. commerce this week, while the White House forecast a staggering jump in the nation's monthly jobless rate. Sentiments will be positive in the yellow metal in intraday, says Jigar Trivedi, Fundamental Research Analyst - Commodities. Anand Rathi Shares and Stock Brokers.

    09:38 (IST)27 Apr 2020
    US Q1 earnings, Q1 GDP data would be crucial

    Developments in the domestic credit markets and RBI's response to it would be closely followed. The liquidity in lower rated papers has dried out. The spreads of good AAA names also widened 20-30bps on Friday after Franklin Templeton said it was shutting 6 schemes. US Q1 earnings and US Q1 GDP data would be crucial this week says Abhishek Goenka, Founder and CEO, IFA Global

    09:34 (IST)27 Apr 2020
    IndusInd Bank to Sensex gainer

    Out of 30 stocks that constitute the S&P BSE Sensex, 29 scrips were trading in green today with IndusInd Bank as top gainer up over 3 per cent, followed by Reliance Industries (RIL), Maruti Suzuki and HDFC.

    Check live prices: IndusInd Bank

    09:32 (IST)27 Apr 2020
    Senex, Nifty up nearly 2%

    The 30-share Sensex was trading 554 points or 1.77 per cent up at 31,881, while the broader Nifty 50 index was ruling at 9,313, up 160 points or 1,74 per cent. 

    Check live Sensex, Nifty levels

    09:08 (IST)27 Apr 2020
    Income Tax rate at 40% for those earning over Rs 1 crore? CBDT rejects IRS officials report

    The Central Board of Direct Taxes has rejected a report by Indian Revenue Services (IRS) Officials that suggested to charge tax at 40 per cent to those earning over Rs 1 crore. In an official statement, the CBDT said, “The Central Board of Direct Taxes (CBDT) has said today that there is some report circulating on social media regarding suggestions by a few IRS officers on tackling COVID-19 situation.

    Read full story

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