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NSE Intra-day chart (05 April 2021)
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Market Commentary 06 April 2021
Markets likely to make positive start amid firm global cues


Indian equity benchmarks ended sharply lower with losses of over one and half percent on Monday, as a record jump in the Covid-19 cases in the country which led to lockdown-like restrictions in the economically important state of Maharashtra spooked investors. Markets made negative start and enlarged their losses in morning deals, as the sentiments remained down-beat with ratings agency Ind-Ra stating that further surge in global commodity prices will have serious implications for India's economy which is still struggling to come out of the Covid-19 impact. It also stated a higher retail inflation not accompanied by a commensurate increase in wage growth will adversely impact the consumption demand and in turn investment revival in the economy.  Indian equities continued to witness bloodbath in afternoon session, as the survey report showed Indian manufacturing activity eased in the month of March but it remains above the boom-or-bust line of 50 that separates expansion from contraction, as firms scaled up production and input buying in line with another upturn in sales. As per the report, the Nikkei India Manufacturing Purchasing Managers' Index (PMI) - a composite single-figure indicator of manufacturing performance - stood at 55.4 in March as against 57.5 in February. Sentiments also remained dampened as Reserve Bank of India (RBI) data showed that the country's foreign exchange reserves declined by $2.986 billion to reach $579.285 billion in the week ended March 26. In the previous week ended March 19, the forex kitty had increased by $233 million to $582.271 billion. It had touched a record high of $590.185 billion in the week ended January 29, 2021. The fall in reserves was on account of a decrease in foreign currency assets (FCA), a major component of the overall reserves. Finally, the BSE Sensex fell 870.51 points or 1.74% to 49,159.32, while the CNX Nifty was down by 229.55 points or 1.54% to 14,637.80. 


The US markets ended higher on Monday as traders finally had an opportunity to react to the monthly jobs report, which was released while the markets were closed on Friday. The closely watched report from the Labor Department showed employment in the US spiked by much more than expected in the month of March. The Labor Department said non-farm payroll employment surged up by 916,000 jobs in March after climbing by an upwardly revised 468,000 jobs in February. Street had expected employment to jump by 647,000 jobs compared to the addition of 379,000 jobs originally reported for the previous month. The bigger than expected increase in employment reflected widespread job growth, with employment in the leisure and hospitality sector once again leading the way. The stronger than expected job growth resulted in a continued decrease by the unemployment rate, which fell to 6.0 percent in March from 6.2 percent in February. The drop matched expectations. Besides, Stocks saw further upside following the release of a report from the Institute for Supply Management (ISM) showing its reading on activity in the service sector soared to an all-time high in March. The ISM said its Services PMI surged up to 63.7 in March from 55.3 in February, with a reading above 50 indicating growth. Street had expected the index to rise to 58.5.


Crude oil futures ended lower on Monday weighed down by the recent decision by major oil producers to increase production beginning in May and on concerns about the outlook for energy demand due to rising coronavirus cases. The Organization of the Petroleum Exporting Countries, Russia and their allies, collectively known as OPEC+, decided last week to boost output in May by 350,000 barrels a day, and by the same amount again in June, and a further 400,000 bpd or so in July. Saudi Arabia will restore an additional 1 million barrels per day in cuts that it made on its own as economies slowly expand after pandemic lockdowns. Crude oil futures for May fell $2.80 or 4.6 percent to settle at $58.65 barrel on the New York Mercantile Exchange. June Brent crude declined $2.61 or 4 percent to settle at $62.25 a barrel on London's Intercontinental Exchange.


Indian rupee ended weaker against dollar on Monday with fresh dollar demand by banks and importers. Sentiments remained down-beat as Reserve Bank of India (RBI) data showed that the country's foreign exchange reserves declined by $2.986 billion to reach $579.285 billion in the week ended March 26. In the previous week ended March 19, the forex kitty had increased by $233 million to $582.271 billion. Traders were also worried as India's manufacturing sector activities lost further growth momentum and fell to a seven-month low in March as demand was constrained by the escalation of the COVID-19 pandemic. Hefty selloff in domestic equity markets amid concerns over the pace of national economic recovery after the daily surging coronavirus infections also impacted investors' mood. On the global front, US dollar has been strengthening against most leading currencies worldwide over rising hopes that the US economy could post a faster than expected recovery from the coronavirus crisis. Finally, the rupee ended 73.30, weaker by 18 paise from its previous close of 73.12 on Wednesday. The currency touched a high and low of 73.45 and 73.28 respectively.


The FIIs as per Monday's data were net seller in equity segment and net buyer in debt segment. In equity segment, the gross buying was of Rs 14663.98 crore against gross selling of Rs 16357.69 crore. In the debt segment, the gross purchase was of Rs 2493.29 crore with gross sales of Rs 843.84 crore. Besides, in the hybrid segment, the gross buying was of Rs 36.01 crore against gross selling of Rs 33.85 crore.


The US markets ended higher on Monday as a strong bounce in US job growth and solid data in the services sector raised expectations for a swift economic recovery from the pandemic. Asian markets are trading mostly higher in early deals on Tuesday after major indexes on Wall Street surged to record closing highs overnight. Indian equity benchmarks ended with sharp losses on Monday on account of rising Covid-19 cases.  Today, the start of session is likely to be positive on firm global cues.  Traders will get support as India has attracted record total FDI inflow for the first ten months of a financial year in 2020-21. Accordingly, the inflow rose to $72.12 billion during April to January, 2021, 15 per cent higher as compared to the first ten months of 2019-20, when it stood at $62.72 billion. The FDI equity inflow grew by 28 per cent in the first ten months of FY 2020-21 ($54.18 billion) compared to the year ago period ($42.34 billion). In terms of top investor countries, Singapore is at the apex with 30.28 per cent of the total FDI equity inflow followed by USA (24.28 per cent) and UAE (7.31 per cent) for the first ten months of the current financial year 2020-21. Further, support may also come as the country witnesses a rapid resurgence of coronavirus cases, a Finance Ministry report has exuded confidence in the Indian economy and termed the economic recovery as resilient citing improvement in high frequency indicators. The Monthly Economic Review for March 2021 released by the Department of Economic Affairs (DEA) said that the agricultural sector remains the bright spot of Indian economy with foodgrains production touching 303.3 million tonnes in 2020-21 beating record production levels for the fifth consecutive year in a row. Trades may take note of report that Niti Aayog CEO Amitabh Kant said India is well-positioned to become a global leader in Artificial Intelligence (AI) and there is a need to adopt it across all sectors. Kant further said the government has a crucial role to play in positioning India as the tech garage of the world. He also said AI has been catalysing leadership in the last few years and it is a game changer. However, traders may be concerned as Care Ratings has said Maharashtra's radical lockdown move will have an economic impact of Rs 40,000 crore, with the trade, hotels and transport sector to bear the biggest dent. The rating agency said the loss of economic activity will have a 0.32 per cent impact on the gross value added (GVA) growth at the national level. It revised down its national GDP growth estimate to 10.7 - 10.9 per cent from the 11 - 11.2 per cent given a week ago. Meanwhile,  with a daily increase of 96,557 in total Covid-19 cases, the second-highest so far, India's tally of coronavirus cases has risen to 12,684,477 in the last 24 hours, Worldometer showed. Active cases are nearing the 800,000-mark. India's tally of new cases is growing faster than most others in the top-five list of countries with the highest daily number of Covid-19 cases. The death toll from the deadly infection stands at 165,577. Maharashtra reported over 47,000 new coronavirus cases on Monday, nearly 10,000 cases less than Sunday when the state witnessed its highest single-day spike since the pandemic began.


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  • State Bank of India has revised its home loan rate to 6.95 per cent effective April 1. With the revision, the lowest rate of 6.70 per cent regime for limited period ended in March 31.
  • Adani Ports and Special Economic Zone (APSEZ) has signed agreement with Vishwa Samudra Holdings to acquire 25% stake of Adani Krishnapatnam Port.
  • Tata Motors' wholly owned subsidiary -- Jaguar Land Rover (JLR) is planning to initiate ten product-related actions in FY22.
  • HDFC Bank's advances aggregated to approximately Rs 11,320 billion as of March 31, 2021(Q4FY21), a growth of around 13.9% over Rs 9,937 billion as of March 31, 2020.
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