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NSE Intra-day chart (24 August 2020)
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Market Commentary 25 August 2020
Benchmarks to make positive start amid firm global cues


Extending gains for second straight session, Indian stock markets ended around one percent higher each on Monday, as signs of progress in developing a Covid-19 treatment offset fears about resurgence in virus cases that could risk stifling an economic recovery. Markets made optimistic start and stayed in green for whole day, amid firm cues from global markets. Traders took encouragement with union minister Nitin Gadkari's statement that focus on critical infrastructure building through an integrated approach, right from a number of strategic tunnels and bridges to 22 green expressways, is bound to place India in the league of advanced nations like the US, UK and Australia in the coming two years. Investors got some comfort with data showing that investments through participatory notes (P-notes) in the domestic capital market soared to Rs 63,288 crore till July-end. Domestic bourses added more strength in second half of the session, as traders remain energized with Ministry of Finance stating that businesses with an annual turnover of up to Rs 40 lakh are Goods and Services Tax (GST) exempt and those with a turnover up to Rs 1.5 crore can opt for the Composition Scheme and pay only one percent tax. Initially, this limit was Rs 20 lakh. Adding to the optimism, the government has come out with norms for the enforcement of rules of origin provisions for allowing preferential rate of customs duties on products imported under free trade agreements. The new norms have been framed with a view to checking inbound shipments of low quality products and dumping of goods by a third country routed through an FTA partner country. Traders also took a note of US India Strategic and Partnership Forum (USISPF) president Mukesh Aghi's statement that India needs to look at environmental, social and governmental (ESG) factors to attract major investors and get the sustained foreign direct investment (FDI) of $100 billion per annum that the country needs to get back to 8-9 percent growth. Finally, the BSE Sensex rose 364.36 points or 0.95% to 38,799.08, while the CNX Nifty was up by 94.85 points or 0.83% to 11,466.45.


The US markets ended higher on Monday as hopes for a potential COVID-19 treatment bolstered trading for more growth-sensitive sectors that have lagged the rest of the market. The Food and Drug Administration (FDA) announced that it has issued an emergency use authorization for investigational convalescent plasma for the treatment of COVID-19 in hospitalized patients. The FDA concluded convalescent plasma may be effective in treating COVID-19 and that the known and potential benefits of the product outweigh the known and potential risks. FDA Commissioner Dr. Stephen Hahn said I am committed to releasing safe and potentially helpful treatments for COVID-19 as quickly as possible in order to save lives. He added the data from studies conducted this year shows that plasma from patients who've recovered from COVID-19 has the potential to help treat those who are suffering from the effects of getting this terrible virus Adding to the positive sentiment, a private report said the Trump administration is considering fast-tracking an experimental coronavirus vaccine from the U.K. for use in America ahead of the presidential election.


Crude oil futures settled in green on Monday as a pair of tropical storms, which are expected to make landfall within days of each other, closed in on the Gulf of Mexico, forcing the shutdown of offshore drilling rigs responsible for more than half of the region's crude production and nearly half of its natural-gas output. Based on information submitted by operators, the Bureau of Safety and Environmental Enforcement estimated that 57.6% of current Gulf oil production has been shut in, along with 44.6% of natural-gas output. That equates to around 1.1 million barrels a day of oil output. Crude oil futures for October rose 23 cents or 0.5 percent to settle at $42.57 a barrel on the New York Mercantile Exchange. October Brent crude gained 43 cents or 1 percent to settle at $44.78 a barrel on London's Intercontinental Exchange.


Indian rupee ended substantially stronger on fresh selling of American currency by banks and exporters, in line with upbeat domestic equities and sustained foreign fund inflows. Besides, weaker American dollar against key global currencies also supported the Indian unit. Sentiments remained upbeat as Ministry of Finance has said that businesses with an annual turnover of up to Rs 40 lakh are Goods and Services Tax (GST) exempt and those with a turnover up to Rs 1.5 crore can opt for the Composition Scheme and pay only one percent tax. Meanwhile, investments through participatory notes (P-notes) in the domestic capital market soared to Rs 63,288 crore till July-end. P-notes are issued by registered foreign portfolio investors (FPIs) to overseas investors who wish to be part of the Indian stock market without registering themselves directly. On the global front; dollar fell on Monday, riskier currencies gained and European markets opened higher, with the pickup in sentiment to U.S. regulators approving a treatment for COVID-19 patients. Finally, the rupee ended at 74.32, 52 paise stronger from its previous close of 74.84 on Friday.


The FIIs as per Monday's data were net buyers in both equity segment and debt segment. In equity segment, the gross buying was of Rs 3915.56 crore against gross selling of Rs 3477.79 crore, while in the debt segment, the gross purchase was of Rs 1445.97 crore with gross sales of Rs 477.75 crore. Besides, in the hybrid segment, the gross buying was of Rs 3.03 crore against gross selling of Rs 13.41 crore.


The US markets ended higher on Monday  following upbeat news on the coronavirus front, with companies that have been hit hardest by the pandemic, like cruise operators and airlines, helping lead the markets higher. Asian markets are trading mostly in green on Tuesday following rally on Wall Street overnight. Indian markets ended higher on Monday led by financial stocks and Eicher Motors. Today, the markets are likely to continue optimism with positive start for second consecutive day tracking firm global cues. Traders will be getting some encouragement with a private report that the phase 2 human clinical trial of the Oxford COVID-19 vaccine candidate by Pune-based Serum Institute of India (SII) is set to begin from Tuesday. The observer-blind, randomised controlled study to determine the safety and immunogenicity of Covishield on healthy Indian adults will begin at Bharati Vidyapeeth Medical College and Hospital in Pune. Some support will also come as ratings agency Crisil said it expects India's retail food inflation, measured through the Consumer Price Index (CPI), to ease in the second half of this financial year owing to the effect of high base of previous year coupled with a bumper rabi harvest and good prospect of kharif harvest. Traders may take note of report that the government is considering a proposal to permit foreign direct investment (FDI) in limited liability partnership (LLP) firms engaged in construction development with a view to attracting overseas fund inflows. Meanwhile, the government has extended the validity of expiring driving licence and motor vehicle documents till December 31 in view of the prevailing condition in the country due to coronavirus. Though, rising coronavirus cases in the country may keep upside in check. India has recorded 59,696 coronavirus cases in the past 24 hours, taking its total to 3,164,881. With 854 fatalities reported on Monday, the country's death toll has surged to 58,546 - only a notch below Mexico. Telecom stocks will be in focus as the Supreme Court reserved its judgment on the AGR case after several rounds of hearing. The court observed that if telecom companies are unwilling to pay their dues, it would direct the Union government to cancel their spectrum allocation and licence.


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Tata Motors






  • NTPC has received the approval of Niti Aayog and DIPAM to set up a wholly-owned company for its renewable energy business. 
  • State Bank of India has received an approval to raise Rs 8,931 crore. 
  • Maruti Suzuki India's multi-purpose vehicle XL6 has crossed the 25,000-unit sales milestone in a year of its launch. 
  • Axis Bank is planning to acquire 17.002% of the equity share capital of Max Life Insurance Company, resulting in total ownership of 18.0% post the transaction.
News Analysis