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NSE Intra-day chart (07 September 2020)
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Market Commentary 08 September 2020
Markets to open slightly in green amid positive Asian cues


Swinging in between gains and losses, domestic benchmark indices ended a choppy day of trade with marginal gains on Monday, as IT, FMCG and TECK stocks witnessed buying. After making cautious start, key indices fell sharply as traders got anxious with FICCI's statement that the recent rise in smuggling in the northeastern region can be attributed to economic distress insinuated by Covid-19 pandemic. After that, key gauges trimmed some of their initial losses and traded in range-bound for most part of the day, as rising coronavirus cases in the country kept the inventors nervous. Sentiments remained in lackluster mood with former Reserve Bank Governor Raghuram Rajan stated that the negative GDP growth numbers should alarm everyone. Emphasising on the importance of government relief or support in the given scenario, he pointed out that it is meagre so far. However, domestic markets erased all the losses and managed to end marginally higher, taking support from Finance Minister Nirmala Sitharaman's statement that India's commitment to reform is being taken seriously by foreign investors, which is evident from the good inflow of FDI even during the time of COVID-19. Between April-July, the Foreign Direct Investment (FDI) into India stood at $20 billion. Market participants also took a note of Former Union finance minister P Chidambaram's statement that the government needs to borrow more to help stimulate demand and revive the country's Gross Domestic Product (GDP) growth. He also suggested some measures to raise money which include relaxing FRBM norms, accelerating disinvestment and borrowing money from global banks. Finally, the BSE Sensex rose 60.05 points or 0.16% to 38,417.23, while the CNX Nifty was up by 21.20 points or 0.19% to 11,355.05.


The US markets were closed on Monday on account of Labor Day.


Indian rupee depreciated significantly against dollar on Monday, on account of sustained dollar demand from importers and banks. Sentiment remained downbeat despite finance ministry in its Monthly Economic Review for August has said the country is witnessing a V-shaped pattern of recovery. Meanwhile, former Union finance minister P Chidambaram suggested that the government to borrow more to help stimulate demand and revive the country's Gross Domestic Product (GDP) growth. He also suggested some measures to raise money which include relaxing FRBM norms, accelerating disinvestment and borrowing money from global banks. On the global front; euro-dollar exchange rate steadied above $1.18 on Monday as traders took stock of the latest U.S. jobs data and prepared for the European Central Bank meeting on Thursday to see if policymakers will introduce yet more stimulus. Finally, the rupee ended at 73.35, 21 paise weaker from its previous close of 73.14 on Friday.


The FIIs as per Monday's data were net sellers in equity segment, while they were net buyers in debt segment. In equity segment, the gross buying was of Rs 3796.92 crore against gross selling of Rs 6604.23 crore, while in the debt segment, the gross purchase was of Rs 1361.68 crore with gross sales of Rs 244.75 crore. Besides, in the hybrid segment, the gross buying was of Rs 5.13 crore against gross selling of Rs 23.00 crore.


The US markets remained closed on Monday on account of Labor Day. Asian markets are trading mostly in green on Tuesday as Japan released revised gross domestic product figures for the second quarter. Indian markets ended marginally higher after a volatile session on Monday led by IT, FMCG stocks and heavyweights HDFC and RIL. Today, the markets are likely to make flat-to-positive start following gains in Asian peers. Some support will come with report that the Reserve Bank of India (RBI) announced a special round of simultaneous sale and purchase of government securities (G-Secs) for Rs 10,000 crore each, on September 10, 2020. It has released details of the sale and purchase of securities, which will be done using the multiple price auction method. Traders may take note of the Kamath Committee's recommendations for Covid-19-related debt restructuring. The committee has recommended financial ratios for 26 sectors which could be factored in by lending institutions while finalising a resolution plan for a borrower. Meanwhile, a day after a record spike of over 90,000, India has seen a major drop in the number of new cases. The country's tally now stands at 4,277,584. Though, geo-political concerns may weight down on gains in the markets. According to reports, an incident of firing took place on the Line of Actual Control in Eastern Ladakh sector where troops of India and China have been engaged in a stand-off for over three months. Traders will be concerned as global credit rating agency Fitch revised India's FY21 central government fiscal deficit forecast to 8.2 percent of GDP from 7.2 percent due to higher than anticipated willingness of govt to spend amid weak revenue collection. There may be some cautiousness with Moody's Investors Service's report that the continued rise in new infection rates across parts of Europe and Asia highlights the risk of a second wave of infections which could lead to renewed closures and a sustained pullback in consumption. The MSME stocks will be in focus as the Finance Ministry said banks have sanctioned loans of about Rs 1,61,017 crore under the Rs 3-lakh crore Emergency Credit Line Guarantee Scheme (ECLGS) for the MSME sector reeling under the slowdown caused by the coronavirus pandemic. There will be some reaction in aviation stocks as rating agency ICRA said air passenger traffic in the country logged a 26 per cent month-on-month growth at 2.6 million passengers in August, with airlines scaling up capacity by 27 per cent over July.


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  • L&T's construction arm -- L&T construction has won prestigious package for its Power Transmission and Distribution Business. 
  • HDFC has approved home loans of over Rs 47,000 crore to more than 2 lakh first-time homebuyers under the government's CLSS. 
  • TCS has partnered with Transnet Port Terminals in South Africa to help the latter develop an integrated online marketplace platform. 
  • State Bank of India has planned a voluntary retirement scheme under which about 30,190 employees are eligible.
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