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NSE Intra-day chart (05 May 2021)
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Market Commentary 06 May 2021
Benchmarks to get optimistic start tracking firm trend in Asian peers


Indian equity benchmarks ended the Wednesday's trades in green terrain on Wednesday with Sensex and Nifty ending above their crucial 48,600 and 14,600 levels, respectively. Markets started the day on optimistic note as upbeat earning from several companies aided sentiments. Some support came in with report that Brihanmumbai Municipal Corporation (BMC) received a fresh stock of one lakh COVID vaccine doses and it will resume vaccination of people above 45 years at government vaccination centres. Market participants largely overlooked S&P Global Ratings' statement that an ongoing second wave of COVID-19 infections in India could hurt its near-term economic recovery and possibly diminish growth for the full year. It added that India's COVID wave will inevitably hit the recovery and could push growth below 10%. Markets extended gains in late trade to end near intraday highs as traders got support after Reserve Bank of India (RBI) Governor Shaktikanta Das unveiled liquidity support measures amid rising Covid-19 cases in India. Shaktikanta Das said that the 2nd wave of COVID-19 in India has drastically altered the economic situation. He added that RBI will continue to monitor emerging situation, using all resources. Further, RBI announced fresh restructuring resolutions for individuals, small businesses and Micro, Small and Medium Enterprises (MSME) borrowers who have an aggregate exposure of upto Rs 25 crore.  Traders shrugged off reports that India's services sector activities eased to a three-month low in April, as the rise in business activity was constrained by the pandemic and sentiment towards growth prospects faded. The seasonally adjusted India Services Business Activity Index fell to 54 in April from 54.6 in March, the slowest increase in output in three months. Finally, the BSE Sensex rose 424.04 points or 0.88% to 48,677.55, while the CNX Nifty was up by 121.35 points or 0.84% to 14,617.85.


The US markets ended mostly higher on Wednesday amid the Biden administration announced that it supports waiving intellectual patent protections for Covid-19 vaccines, as countries struggle to manufacture the life-saving doses. The continued upward move by the Dow came after the blue chip index bucked the downtrend seen during trading on Tuesday to close modestly higher. Strong gains by Dow Inc., Chevron and Merck helped lift the Dow to a new record closing high. On the economic data front, after reporting an unexpected slowdown in US manufacturing growth earlier this week, the Institute for Supply Management (ISM) released a report showing the pace of US service sector growth also unexpectedly slowed in the month of April. The ISM said its services PMI edged down to 62.7 in April after jumping to an all-time high of 63.7 in March. A reading above 50 still indicates growth in the service sector, but street had expected the index to inch up to 64.3. Private sector job growth in the US accelerated in the month of April but still came in below street estimate, according to a report released by payroll processor ADP. ADP said private sector employment spiked by 742,000 jobs in April after surging by an upwardly revised 565,000 jobs in March. However, Street had expected private sector employment to soar by 800,000 jobs compared to the jump of 517,000 jobs originally reported for the previous month. Chief economist at ADP, Nela Richardson said the labor market continues an upward trend of acceleration and growth, posting the strongest reading since September 2020. The report showed notable job growth in the goods-producing sector, which added 106,000 jobs amid increases in both manufacturing and construction jobs.


Crude oil futures ended marginally lower on Wednesday despite US crude stocks falling more sharply than expected. Data released by Energy Information Administration (EIA) showed crude oil inventories dropped by 7.99 million barrels last week (April 30), more than three times the expected decline. The EIA data also said US crude exports hit a record high of 4.1 million barrels per day last week.The American Petroleum Institute (API) reported on Tuesday that US crude stockpiles fell by 7.7 million barrels in the week ended April 30. Crude oil futures for June lost 6 cents or 0.09 percent to settle at $65.63 barrel on the New York Mercantile Exchange. However, July Brent crude added 8 cents or 0.1 percent to settle at $68.96 a barrel on London's Intercontinental Exchange.


Indian rupee ended lower against the US dollar on Wednesday, on increased demand for the greenback from importers and banks. Traders were worried as India's services sector activities eased to a three-month low in April, as the rise in business activity was constrained by the pandemic and sentiment towards growth prospects faded. The seasonally adjusted India Services Business Activity Index fell to 54 in April from 54.6 in March, the slowest increase in output in three months. However, downfall remained limited as Reserve Bank of India (RBI) Governor Shaktikanta Das said that the central bank will continue to monitor the emerging COVID-19 situation and will deploy all resources and instruments at its command for citizens, business entities, and institutions beleaguered by the second wave. On the global front, dollar hit its highest in over two weeks on Wednesday, extending a rally as chatter about the possibility of higher U.S. interest rates and a sell-off in tech stocks soured risk sentiment to the benefit of the safe-haven currency. Finally, the rupee ended 73.91, weaker by 6 paise from its previous close of 73.85 on Tuesday.


The FIIs as per Wednesday's data were net seller in equity segment, while net buyer in debt segment. In equity segment, the gross buying was of Rs 5884.79 crore against gross selling of Rs 7629.16 crore, while in the debt segment, the gross purchase was of Rs 913.25 crore with gross sales of Rs 283.83 crore. Besides, in the hybrid segment, the gross buying was of Rs 0.56 crore against gross selling of Rs 13.69 crore.


The US markets ended mostly in green on Wednesday driven higher by energy and other economically sensitive sectors. Asian markets are trading higher on Thursday as investors look ahead to the US jobs report due later this week for clues about how long the Fed will stay on hold. Indian markets rallied about 1 percent on Wednesday after the Reserve Bank of India (RBI) announced a raft of measures to help the financial services industry tide over the second coronavirus wave that threatens economic recovery. Today, the markets are likely to extend previous session's gains with optimistic start following firm trade in Asian peers coupled with a strong set of corporate numbers. Sentiments will be getting boost with a report that Roche India announced that the Central Drugs Standards Control Organisation (CDSCO) has provided an Emergency Use Authorisation (EUA) for its antibody cocktail Casirivimab and Imdevimab in India to treat COVID-19 patients. Some support will come as RBI Governor Shaktikanta Das on Wednesday hoped that a normal Southwest monsoon will have a soothing impact on inflation pressures and ruled out any wide variations in medium-term inflation forecast from what was given in April, despite admitting to price pressures both from food items and input prices. Traders may take note of Asian Development Bank's (ADB) statement that investment in health, education and social protection alongside deeper regional cooperation can help countries in Asia Pacific region in achieving equitable recovery from the pandemic. However, the addition of another 412,618 fresh Covid cases in the last 24 hours may cap the upside. With this, the cumulative caseload has surged past 21 million, Worldometer showed. Traders may be concerned as principal scientific advisor K Vijayaraghavan said the third phase of the pandemic is inevitable given the high level of circulating virus, without giving a timeframe. There may be some cautiousness as industry chamber PHDCCI said imposition of partial lockdowns and curfews in many parts of the country, due to re-emergence of COVID-19 pandemic, has created incipient signs of economic slowdown in the coming months. Also, S&P Global Ratings has slashed India's GDP growth forecast for the current financial year to 9.8 per cent saying the second COVID wave may derail the budding recovery in the economy and credit conditions. The US-based rating agency in March had a 11 per cent GDP growth forecast for India for the April 2021-March 2022 fiscal on account of a fast economic reopening and fiscal stimulus. Aviation stocks will be in focus as rating agency Icra estimates 29 per cent sequential decline in domestic air traffic in April as the second wave of Covid-19 disrupted air travel. It said in April domestic airlines flew 5.5-5.6 million passengers compared to 7.8 million passengers in March. There will be some important earnings announcements too to keep the markets buzzing.


Support and Resistance: NSE (Nifty) and BSE (Sensex)



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NSE Nifty




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Nifty Top volumes





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Oil & Natural Gas Corporation





State Bank of India





Adani Ports and SEZ





Tata Motors





Sun Pharmaceutical Industries






  • L&T has immediately started working towards a long-term solution to meet the medical-grade oxygen demand in the country. 
  • Maruti Suzuki India is expecting some impact on its production if lockdowns and curfews imposed across various states continue amid the second wave of COVID-19 sweeping across the country.
  • Coal India's operations slowed down on account of more than 5,400 of the company's employees and their wards across subsidiaries testing positive for coronavirus. 
  • Infosys has joined forces with Deakin to develop a strategic action plan for research, innovation and skill development.
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