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NSE Intra-day chart (06 May 2021)
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Market Commentary 07 May 2021
Markets likely to continue gaining momentum with positive start


Extending their previous session gains, Indian equity benchmarks ended the Thursday's trade in green terrain with Sensex and Nifty settling above their crucial 48,900 and 14,700, respectively. Markets started the session on optimistic note as traders took support 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. Soon market participants turned cautious and key gauges pared all their gains to trade near neutral lines after 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. Meanwhile, the cumulative caseload has surged past 21 million, Worldometer showed. However, markets gained traction in second half of the day as traders turned optimistic with US President Joe Biden's decision to back waiving intellectual property rights on vaccines. This will quicken the vaccination process enabling countries like India to come out of the pandemic faster. Markets extended gains in last leg of trade as in order to prevent the COVID-induced health crisis from turning into a full-blown economic catastrophe, Finance Minister Nirmala Sitharaman has asked multilateral lending institutions like the Asian Development Bank (ADB) to extend support to developing countries. Besides, the Union Cabinet has given ex-post facto approval to the signing of Memorandum of Understanding (MoU) between the Ministry of External Affairs of the Government of Republic of India and Foreign, Commonwealth and Development Office (FCDO) of the United Kingdom on Global Innovation Partnership (GIP). Traders shrugged off report that S&P Global Ratings has slashed India's GDP growth forecast for the current financial year (FY22) to 9.8 per cent. 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. Finally, the BSE Sensex surged 272.21 points or 0.56% to 48,949.76, while the CNX Nifty was up by 106.95 points or 0.73% to 14,724.80.


The US markets ended higher on Thursday with Dow Jones Industrial Average reaching new record closing high. The strength that emerged on markets came following the release of a Labor Department report showing first-time claims for US unemployment benefits fell by much more than expected in the week ended May 1st. The report said initial jobless claims slid to 498,000, a decrease of 92,000 from the previous week's revised level of 590,000. Street had expected initial jobless claims to edge down to 540,000 from the 553,000 originally reported for the previous week. The bigger than expected decrease once again dragged jobless claims down their lowest level since the early days of the coronavirus pandemic. After reporting a sharp pullback in US labor productivity in the previous quarter, the Labor Department released a report showing productivity rebounded by more than expected in the first quarter of 2021. The Labor Department said labor productivity spiked by 5.4 percent in the first quarter after tumbling by a revised 3.8 percent in the fourth quarter of 2020. Street had expected productivity to surge up by 4.3 percent compared to the 4.2 percent nosedive that had been reported for the previous quarter. The rebound in productivity, a measure of output per hour, came as output shot up by 8.4 percent compared to a 2.9 percent increase in hours worked. Besides, significant strength was visible among steel stocks, as reflected by the 2.8 percent jump by the NYSE Arca Steel Index. The index once again reached its best closing level in nearly ten years. Telecom stocks also turned in a strong performance on the day, driving the NYSE Arca North American Telecom Index up by 1.9 percent to a four-year closing high.


Crude oil futures ended lower on Thursday amid worries about outlook for energy demand due to surge in coronavirus cases in India. India posted record daily COVID-19 infections and deaths, with the virus spreading from cities to villages across the world's second-most populous nation, dashing hopes that the country's deadly second wave was about to peak. The record numbers of new infections in India have been making the headlines and fueling fears that demand may recover more slowly. Crude oil futures for June dropped $0.92 or 1.4 percent to settle at $64.71 barrel on the New York Mercantile Exchange. July Brent crude fell $0.43 or 0.6 percent to settle at $68.54 a barrel on London's Intercontinental Exchange.


Indian rupee ended stronger against dollar on Thursday due to fresh selling of the American currency by banks and exporters. Domestic currency also derived its strength from strong gains in the local equity markets. Traders were taking comfort with US President Joe Biden's decision to back waiving intellectual property rights on vaccines. This will quicken the vaccination process enabling countries like India to come out of the pandemic faster. Traders shrugged off Industry chamber PHDCCI's statement that 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. On the global front, pound hovered around the $1.39 mark as traders waited for a Bank of England policy meeting later on Thursday where the central bank will say the British economy is rebounding strongly and that it might begin to slow its bond-buying. Finally, the rupee ended 73.78, stronger by 13 paise from its previous close of 73.91 on Wednesday.


The FIIs as per Thursday's data were net seller in equity segment, while net buyer in debt segment. In equity segment, the gross buying was of Rs 5379.06 crore against gross selling of Rs 5836.60 crore, while in the debt segment, the gross purchase was of Rs 311.25 crore with gross sales of Rs 290.22 crore. Besides, in the hybrid segment, the gross buying was of Rs 0.67 crore against gross selling of Rs 244.17 crore.


The US markets ended higher on Thursday bolstered by an upbeat weekly jobless claims report, while vaccine makers dipped after US President Joe Biden backed plans to waive patents on COVID-19 shots. Asian markets are trading in green on Friday following overnight gains on Wall Street. Indian markets ended higher on Thursday led by gains in metals, auto, and IT stocks amid positive global cues. Today, markets are likely to continue gaining momentum for yet another day with optimistic start tacking firm global cues. Upbeat earning from many companies may add support to the markets. Traders will be taking encouragement as Union Minister Nitin Gadkari said the Centre has decided to increase production of anti-viral drug Remdesivir and it will be provided to people at government's price. Some support will come as secretary ministry of Earth Sciences, M Rajeevan said India's southwest monsoon is expected to arrive over the Kerala coast on June 1, its normal onset date. Though the India Meteorological Department (IMD) will officially announce the 2021 monsoon onset date on May 15. Though, traders may be concerned with rising coronavirus cases. India reported a record 414,433 new infections and 3,920 deaths on Thursday, according to Worldometer. Also, the Supreme Court said the country needs to be prepared for the third wave of COVID-19 which experts say could be more harmful, especially for children, and emphasised upon the need to create buffer stock of oxygen. It asked the Centre not to reduce oxygen supply to Delhi from 700MT till further orders. There may be some cautiousness as Credit Suisse sharply lowered its real GDP growth forecast for this fiscal year to around 8.5-9 percent, citing economic disruptions in the country due to the raging second wave that is likely to shave 100-150 bps growth off the economy. Also, the International Monetary Fund said the recent jump in COVID-19 cases in India posed downside risks to the Fund's April forecast for 12.5% growth in India's economic output in fiscal years 2021 and 2022. The IMF will revisit that forecast when it issued a fresh World Economic Outlook in July. There will be some reaction in power stocks as India Ratings and Research (Ind-Ra) said restrictions following the second wave of the COVID-19 pandemic could impact energy demand growth recovery in the first quarter of this financial year. 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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  • Wipro has entered into partnership with Transcell Oncologics to transform vaccine safety assessment using artificial intelligence. 
  • Tata Steel has reported consolidated net profit attributed to shareholders of Rs 6,644.15 crore for Q4FY21 against net loss of Rs 1,481.34 crore for Q4FY20. 
  • Reliance Industries has sought special permission to fly an Israeli team of experts to India to train and install a rapid COVID-19 identification solution it acquired from an Israeli start-up for $15 million. 
  • Maruti Suzuki India's total production in April 2021 stood at 1,59,955 units, down 7 per cent from March this year.
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