Market HIGHLIGHTS: Sensex ends at record closing high, Nifty above 14,600; RIL, Infosys, TCS top gainers

BSE Sensex settled 394 points or 0.80 per cent higher at 49,792.12, while the broader Nifty 50 index settled at 14,623.10, up 102 points or 0.70 per cent.

Domestic equities extended their gains today with benchmark indices recording fresh highs despite mixed global cues. Barring FMCG and realty, most of the sectoral indices contributed positively. IT stocks witnessed sharp recovery today after seeing profit-booking for last couple of trading days. Similarly, PSU Banks again remained in focus today especially on news regarding fresh recapitalization. Notably, volatility index softened for second consecutive day in the range of 21-22, which augurs well for the markets.: Binod Modi, Head Strategy at Reliance Securities

The market witnessed some strong trends and an attempt to overcome the resistance level around the Nifty 50 Index level of 14600. While sustaining above 14600 is the key factor from a short-term perspective, maintain above this level market to gain momentum and open the gate for a movement till 14800/14930. The momentum indicators like RSI, MACD to recover, and market breadth to improve, further strengthening the view of a short-term bullish outlook.: Ashis Biswas, Head of Technical at CapitalVia Global Research Limited

Markets staged a smart recovery from 14300 levels and now trade around 14650. We continue to believe the undertone remains positive for the medium term; for the short term the momentum parameters are stretched and require some sustained correction/time consolidation to neutralize. Expect volatility to rise in the near term. Energy, Banking and FMCG remain preferred sectors with gradual accumulation advisable. Buying on meaningful corrections is advisable; traders are advised to keep leverage under check for the near term: Sahaj Agrawal, Head of Research- Derivatives at Kotak Securities

Just minutes ahead of the closing bell, Tech Mahindra, Maruti Suzuki India, M&M, and Reliance Industries are the top index gainers. 

The Union Cabinet on Wednesday gave ex-post facto approval to a memorandum of understanding (MoU) between India and Uzbekistan for cooperation in the field of solar energy. “The Union Cabinet, chaired by Prime Minister Narendra Modi was apprised of signing of Memorandum of Understanding(MoU) between India and Uzbekistan for cooperation in the field of solar energy,” an official statement said.

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Sensex has once again claimed 49,800 as the index jumped 400 points on Wednesday. Nifty was sitting near 14,650.

"L&T Infotech reported a 5.8% qoq growth in revenues to USD 427.8mn which was well ahead of our expectations. In rupee terms consolidated revenue increased by 5.1% qoq to ?3152.8 crore while gross profits increased by 5.5% qoq to ?1,102.1 crore. During the quarter growth was driven by India which grew by 30.4% QoQ while RoW witnessed a degrowth of 4.2% QoQ. BFS, manufacturing and other verticals witnessed strong growth while Insurance, Energy & Utilities verticals reported sluggish growth. Overall the numbers were ahead of our expectations on all fronts. Post the Q3FY21 numbers we maintain our positive stance on L&T Infotech and expect strong earnings growth of 24.2% CAGR between FY20-23E, though valuations at 24.5xFY23 earnings are expensive," said Jyoti Roy - DVP- Equity Strategist, Angel Broking.

India’s mutual fund industry might be sitting right at the beginning of a massive growth cycle, analysts at Citi Research say. The penetration of mutual funds in India remains low when compared to global peers, leaving abundant ground for various asset managers to cover. “India's AMCs should deliver healthy (~15%) AUM/profit growth in the long term, given a large untapped base of savers and high operating leverage – a view reinforced by our analysis of the performance seen in other countries at a similar point in the industry cycle,” a recent note by Citi Research said.

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Early-stage venture capital firm Fireside Ventures has closed their second fund — Fireside Fund II at Rs 863 crores (around $118 million) with backing from marquee investors including SIDBI’s Rs 10,000 crore Fund of Funds for Startups, Investment Corporation of Dubai, Nippon India Digital Innovation AIF, Bajaj Holdings and Investment, ITC, L’Oréal, Pidilite group, Premji Invest, and a US university endowment. The fund will invest in 15-20 consumer startups while focusing on digital-first brands.

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IT stocks were the top BSE Sensex contributors in today’s upbeat trade. Out of 30 Sensex stocks, the top three gainers were Tech Mahindra, HCL Technologies and Infosys. Also, Tata Consultancy Services (TCS) shares hit a fresh 52-week high of Rs Rs 3,327 apiece, rising nearly 2 per cent from the previous close. Similarly, shares of Tata Elxsi also scaled a fresh 52-week of Rs 2,826 apiece. So far, most of the IT companies have reported better-than-expected October-December quarter earnings and revised revenue guidance for FY21.

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IndiaMART delivered strong operational performance during 3QFY21, led by robust increase in paid suppliers (at 7k v/s their target range of ~5k). Collections were up 9% sequentially but flat on a YoY basis. We increase our FY22E/FY23E EPS estimate by 17%/16% as we anticipate greater resilience on the margin front over the longer term. We value IndiaMART on a DCF basis at INR9,000 per share (+22% upside) assuming 11% WACC and 5% terminal growth rate, implying 62x FY23E EPS. Reiterate Buy.

~ Motilal Oswal Financial Services

Today, millennials have emerged as the smartest breed of financial investors. This new community of investors needs to be encouraged to channel their savings into equities early and start the wealth creation journey. To achieve the mission of building a $5 trillion economy by 2024, the government should consider doing away with the tax on dividend payouts. The other important element will be to streamline taxation on stock market gains. There are multiple classifications such as speculative income, business income, short-term capital gain, and long-term capital gain. This should be reduced to only three categories: 1) business income 2) long-term capital gain, and 3) short-term capital gain. This will ease income classification from the taxpayer's point of view and not lead to any significant tax loss.: Puneet Maheshwari, Director, Upstox

Many Indians who had planned to enjoy an overseas holiday last summer got a rude shock in March last year, when an uncontrollable virus wrecked their travel plans. Little did they know that the virus would not stop at that, but would go on to enforce extended lockdowns, movement restrictions, and radically change the way they consume, work and interact.

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Indian Railway Finance Corporation (IRFC) initial public offer was subscribed 1.22 times on day two of the bidding process. The issue will conclude today for subscription. While Indigo Paints Rs 1,170.16-crore IPO has opened for subscription today and will close on January 22, 2021. Indian share markets will see a third IPO also this week with Home First Finance launching its initial public offer tomorrow (January 21). In the grey market today, a strong premium was seen only in Indigo Paints shares. 

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Shares of ICICI Prudential Life Insurance have soared 30% since the beginning of November last year to now trade at Rs 524 per share. However, that might not be the end of the rally for this insurance stock as global brokerage and research firm Jefferies sees at least another 20% upside for ICICI Prudential Life. “ICICI Pru Life can benefit from a combination of stability in product-mix & expansion in distribution that will lift growth in FY22-23, besides a low base,” analysts at Jefferies said in a report.

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We are trading above the 14550 level which is a resistance point for the Nifty. If we can keep above this, our next target should be 14750-14800. Given the strong undercurrent we can possibly stretch towards 15000 too. A strong support now lies at 14200 and hence any dip or correction can be utilised to enter the index for higher targets.: Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments

An important feature of yesterday's sharp rally of 240 points in Nifty was that it was not triggered by high FII buying. The net institutional buying (FII buying minus DII selling) was only Rs 50 crores. This means the rally was triggered more by short-covering by the cornered bears. However, the sustained delivery buying in large-caps like RIL, HDFC Bank and HDFC indicate strong interest and acumulation in bluechip large-caps. The important message to look out for today would be the economic message from the newly installed President Biden. Early Q3 results indicate a continuation of the better than expected results: V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services

Today, sluggish movement in the US dollar and optimism over global equity markets could pull USDINR pair again towards 73.00 mark. FII investments and corporate results will drive the momentum in the equity markets and will result in the USDINR pair. The lower Short term USDINR volatility suggests forthcoming higher volatility and usually Rupee depreciates in such scenarios. Hence, one can expect upside breakout in USDINR. Meantime, the pair to remain in its comfortable range of 73.00-74.00 levels, therefore one can buy on dips near 73.00-73.10 and sell on upticks above 73.40 levels in the near term.: Amit Pabari, managing director, CR Forex Advisors

TCS share price hit a new 52-week high of Rs 3,327 apiece, rising over 1.5 per cent on BSE today.

Bharti Airtel, Kotak Mahindra Bank, HUL among nine stocks which are dragging the BSE Sensex today. Power Grid Coporation of India was the top Sensex loser.

Tech Mahindra, HCL Technologies, TCS and Infosys were top BSE Sensex gainers in the early trade on Wednesday

USD/INR again ran into resistance around 73.30. Domestic equities made a strong comeback after two sessions of profit taking. Bonds too have recovered after the OMO announcement on Friday. There are rumours that the RBI could have possibly intervened in normal secondary market trading as well to manage sentiment. Rupee is likely to open around 73.17 and trade a 73.10-73.45 range. SGX is indicating a 30-40pt cut for Nifty on open. Today the focus would be on President Biden's inauguration ceremony. : Abhishek Goenka, Founder and CEO, IFA Global

BSE Sensex was trading 166 points or 0.34 per cent higher at 49,564, while the Nifty 50 index was ruling above the crucial 14,550 on Wednesday.

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Sequoia Capital-backed Indigo Paints raised Rs 348 crore from 25 anchor investors just ahead of its initial public offering (IPO) opening today. Among the marquee names that lined up to pick a stake in the decorative paints manufacturing firm include, government of Singapore, Nomura, HSBC, and even Goldman Sachs. The issue will open from today for subscription, making it the second IPO of 2021 just after IRFC’s IPO that closes today. Indigo Paints is looking to raise Rs 1,170 crore from capital markets through the public issue of equity shares and listing the firm on the bourses.

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Multi Commodity Exchange of India (MCX) has received extremely encouraging response with cotton deposits in the current season (October 2020) till date, notably increasing by 285% in December 2020 as against December 2019. (on 31st December 2020 cotton deposit was 80250 bales and on 31st December was 20825 bales). Average daily turnover increased from Rs 61.26 crore in the month of December 2019 to 61.58 crore in December 2020. Moreover, the cotton stocks eligible for delivery at warehouses hit a nine year (since 2011) high at 80,250 bales in December 2020, it is up by 285% compared with 20825 bales in December 2019. The open interest stood at 4236 lots or 105900 bales at the end of December 2020, up compared with 3868 lots or 96700 bales from December 2019, the exchange said in a statement.

COMEX gold trades modestly higher near $1845/oz after a 0.6% gain yesterday. Gold is supported by correction in the US dollar index after recent gains. Comments from US Treasury Secretary nominee Janet Yellen added to market expectations of additional stimulus measures pressurizing the US dollar. Rising virus cases have also lent support to gold however weighing on price is ETF outflows and progress on the vaccine front. Gold may remain in the $1800-1860/oz range unless there are fresh triggers however the general bias may be on the upside owing to stimulus expectations.: Ravindra Rao, VP- Head Commodity Research at Kotak Securities

Shares of Sun Pharma, ONGC, HDFC Bank, Dr Reddy's, Maruti Suzuki were among the top BSE Sensex gainers in the pre-open.

BSE Sensex was trading 188 points or 0.38 per cent higher at 49,586, while the Nifty 50 index was ruling above the crucial 14,600 in the pre-opening session on Wednesday.

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The RBI on Tuesday said state-owned SBI, along with private sector lenders ICICI Bank and HDFC Bank continue to be Domestic Systemically Important Banks (D-SIBs) or institutions which are ‘too big to fail’. SIBs are subjected to higher levels of supervision so as to prevent disruption in financial services in the event of any failure.

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A total of 36 companies including Bajaj Finance, Bajaj Finserv, HDFC Asset Management Company, Federal Bank, Hindustan Zinc, Havells India, L&T Technology Services, Newgen Software Technologies, GMM Pfaudler, Everest Industries, Sterlite Technologies, Syngene International, Tejas Networks, and VST Industries, among others slated to announce their quarterly earnings later in the day today.

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On Tuesday, foreign institutional investors (FIIs) lapped up shares worth Rs 257.55 crore, while domestic institutional investors (DIIs) sold shares worth Rs 199.3 crore on a net basis in the Indian equity market, according to provisional data available on the NSE.

Domestic equity markets Sensex and Nifty made a stellar comeback on Tuesday, after having suffered losses for two consecutive trading sessions. Now after having recouped almost all those losses, S&P BSE Sensex sits at 49,398 points while Nifty 50 is at 14,521. However, the leap from yesterday may not continue on Wednesday morning, as SGX Nifty was hinting at a gap-down start. Just ahead of the change in the Oval Office, Wall Street was buzzing with gains on Tuesday. Asian Peers were also seen mirroring the up-move.

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Investor wealth grew by Rs 3.41 lakh crore on Tuesday as markets made a dashing comeback after two days of losses. The 30-share BSE Sensex soared 834.02 points or 1.72 per cent to close at 49,398.29. Following the upbeat sentiment, the market capitalisation of BSE-listed companies jumped Rs 3,41,846.01 crore to Rs 1,96,19,149.34 crore.

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The initial public offer of Indian Railway Finance Corporation was subscribed 1.22 times on the second day of subscription on Tuesday. The offer received bids for 1,52,64,04,775 shares against 1,24,75,05,993 shares on offer, as per the data available with NSE.

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