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Post Session: Quick Review
Jan-18-2021

Bears held their tight grip over the Dalal Street on Monday’s trading session. Both the Sensex and the Nifty ended with sharp losses. After a cautious start, key benchmarks remained weak for the whole trading day, after report stated that the Indian economy is not recovering as fast as the government claims and the country's economy may contract 25 per cent in the current financial year. It further stated that due to a big decline in the GDP during the current financial year, the budget estimates have gone completely out of gear and, therefore, there is a need to correct the Budget.

In the second half of the trading session, Indian markets managed to cut their losses, as the Reserve Bank of India (RBI) has decided to conduct purchase of Government securities under Open Market Operations (OMO) for an aggregate amount of Rs 10,000 crore on January 21, 2021. Losses got trimmed with the government data showing that India's exports rose marginally to $27.15 billion in December 2020, while imports surged 7.56 per cent to $42.59 billion. The merchandise exports were valued at $27.11 billion in December 2019, while imports had totalled $39.59 billion.

However, in the last hour of the trade, indices witnessed sharp fall. Traders were cautious with former chief economic adviser Arvind Virmani’s statement that the Indian economy is likely to contract in the range of 5-7.5 per cent this fiscal (FY21) but will see a growth of 9 to 11 per cent in FY 2021-22. Further, Virmani said in the upcoming Budget, the government should come up with policies to accelerate India's economic growth. Sentiments were also negative  despite RBI in its latest report has showed that bank credit grew 3.2 per cent to Rs 107.05 lakh crore in the first nine months (April-December) of the current financial year (FY21), against a growth of 2.7 per cent registered in the corresponding period of 2019-20.

On the global front, European markets were trading lower, amid a pullback in global markets. Asian markets finished mostly lower on Monday, even after China's economy gained further momentum towards the end of 2020 as the domestic activity continued to recover from the Covid-19 driven downturn. Gross domestic product climbed 6.5 percent on year in the fourth quarter of 2020. The rate exceeded the expected 6.1 percent and up from 4.9 percent growth posted in the third quarter. On a seasonally adjusted basis, GDP expanded 2.6 percent but slower than the revised 3 percent rise in the preceding three months.

The BSE Sensex ended at 48564.27, down by 470.40 points or 0.96% after trading in a range of 48403.97 and 49122.23. There were 4 stocks advancing against 26 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 2.01%, while Small cap index down by 1.89%. (Provisional)

The only gaining sectoral indices on the BSE were Energy up by 1.10% and Consumer Durables up by 0.77%, while Metal down by 4.14%, PSU down by 2.68%, Utilities down by 2.66%, Telecom down by 2.41% and Healthcare down by 2.31% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Reliance Industries up by 2.37%, Titan Co up by 1.86%, HDFC Bank up by 1.15% and ITC up by 0.76%. On the flip side, ONGC down by 4.59%, Sun Pharma down by 3.74%, Indusind Bank down by 3.71%, Power Grid down by 3.50% and Bajaj Finance down by 3.44% were the top losers. (Provisional)

Meanwhile, following a review of current liquidity and financial conditions, the Reserve Bank of India (RBI) has decided to conduct purchase of Government securities under Open Market Operations (OMO) for an aggregate amount of Rs 10,000 crore on January 21, 2021.

The RBI reserves the right to decide on the quantum of purchase of individual securities, accept bids for less than the aggregate amount, purchase marginally higher/lower than the aggregate amount due to rounding-off and accept or reject any or all the bids either wholly or partially without assigning any reasons.

As per the notification, eligible participants should submit their bids in electronic format on the Reserve Bank of India Core Banking Solution (E-Kuber) system between 10:00 am and 11:00 am on January 21, 2021. Only in the event of system failure, physical bids would be accepted.

The CNX Nifty ended at 14281.30, down by 152.40 points or 1.06% after trading in a range of 14222.80 and 14459.15. There were 6 stocks advancing against 44 stocks declining on the index. (Provisional)

The top gainers on Nifty were UPL up by 7.42%, Reliance Industries up by 2.40%, Titan Co up by 1.78%, HDFC Bank up by 1.12% and ITC up by 0.87%. On the flip side, Tata Steel down by 5.55%, Tata Motors down by 5.51%, ONGC down by 4.68%, Hindalco down by 4.03% and Sun Pharma down by 3.78% were the top losers. (Provisional)

European markets were trading lower, UK’s FTSE 100 decreased 8.12 points or 0.12% to 6,727.59, France’s CAC decreased 21.24 points or 0.38% to 5,590.45 and Germany’s DAX was down by 24.93 points or 0.18% to 13,762.80.

Asian markets finished mostly lower on Monday as surging corona virus infections and worries about worsening Sino-US relations kept the market sentiments under pressure. Japanese shares declined as investors booked profits after gains on hopes of big US stimulus spending by Biden Administration. However, Chinese shares ended higher on optimism over swift economic recovery after better-than-expected growth and industrial production data. China's GDP climbed 6.5 percent year-on-year in the fourth quarter of 2020 against expectations for an increase of 6.1% and up from 4.9% in the three months prior. Industrial production jumped an annual 7.3% in December against forecasts for 6.9% and up from 7% in November.

Asian Indices

Last Trade           

Change in Points

Change in %

Shanghai Composite

3,596.22
29.84
0.84

Hang Seng

28,862.77
288.91
1.01

Jakarta Composite

6,389.83
16.42
0.26

KLSE Composite

1,609.52

-17.49

-1.07

Nikkei 225

28,242.21
-276.97
-0.97

Straits Times

2,990.40
-14.47
-0.48

KOSPI Composite

3,013.93
-71.97
-2.33

Taiwan Weighted

15,612.00
-4.39
-0.03
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