Sensex, Nifty end the week with minor losses

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The key barometers indices ended with small losses amid high volatility. The Sensex and the Nifty retreated after scaling record highs during the week. Fears of the delta COVID-19 variant and China’s tech crackdown impacted sentiment.

Markets this week

In the week ended on Friday, 20 August 2021, the Sensex fell 107.97 points or 0.19% to settle at 55,329.32. The Nifty 50 index lost 78.60 points or 0.48% to settle at 16,450.50. The BSE Mid-Cap index shed 261.17 or 1.14% to settle at 22,679.87. The BSE Small-Cap index declined 597.09 points or 2.27% to settle at 25,758.11.

Benchmark indices settled with decent gains on Monday, 16 August 2021. The Nifty ended above the 16,550 level. The barometer index, the S&P BSE Sensex, advanced 145.29 points or 0.26% at 55,582.58. The Nifty 50 index rose 33.95 points or 0.21% at 16,563.05.

The main indices extended gains on Tuesday, 17 August 2021. The Nifty managed to end above the crucial 16,600 mark. The barometer index, the S&P BSE Sensex, rose 209.69 points or 0.38% at 55,792.27. The Nifty 50 index gained 51.55 points or 0.31%.

Key indices ended a volatile trading session with small losses on Wednesday, 18 August 2021. The barometer index, the S&P BSE Sensex, slipped 162.78 points or 0.29% to settle at 55,629.49. The Nifty 50 index declined 45.75 points or 0.28% to end at 16,568.85.

The domestic stock markets were shut on Thursday, 19 August 2021, on account of Muharram. Benchmark indices settled with steep losses on Friday, 20 August 2021 amid broader selling pressure. The Nifty ended at the 16,450 mark. The barometer index, the S&P BSE Sensex, declined 300.17 points or 0.54% at 55,329.32. The Nifty 50 index declined 118.35 points or 0.71% at 16,450.50.

Covid-19 update

Total Covid-19 confirmed cases worldwide stood at 21,00,03,605 with 44,03,597 deaths. India reported 3,63,605 active cases of COVID-19 infection and 4,33,589 deaths while 3,15,61,635 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.

Stocks in spotlight

Infosys rose 1.15%. The IT major said it will invest an additional sum of $0.45 million in TidalScale Inc, a software-defined-server technology startup. Till date, the IT major has invested $3 million, taking the cumulative investment to $3.45 million as of date (subject to necessary closing conditions).

Eicher Motors advanced 2.10%. Shareholders of Eicher Motors have voted against the re-appointment of Siddhartha Lal as the managing director of the automobile company protesting the proposal to raise his salary by 10%. The proposals to raise Lal’s salary and his re-appointment as the managing director of Eicher were clubbed and brought to vote before shareholders.

Wipro gained 0.71%. The company on Friday announced the launch of its @now Studio in partnership with ServiceNow to support digital transformations for customers, increase innovation and develop unique industry solutions. The @now Studio is located at Wipro’s Technology Center in Plano, Texas where the IT major has a facility focused on developing niche capabilities in new and emerging technologies. This is Wipro’s first @now Studio. The company said it has plans to launch additional studios in Europe and APMEA in the coming months.

Economy

India’s annual rate of inflation based on the wholesale price Index (WPI) eased to 11.16% year-on-year in July 2021, from 12.07% in the previous month and steeply above (-0.25%) in July 2020. The high rate of inflation in July 2021 is primarily due to the low base effect and rise in prices of crude petroleum & natural gas; mineral oils; manufactured products like basic metals; food products; textiles; chemicals and chemical products etc. as compared with the corresponding month of the previous year.

The government on Tuesday, 17 August 2021 notified the rates for the export incentive scheme Remission of Duties and Taxes on Exported Products (RoDTEP) and its rules with an aim to boost exports. The government has decided to extend the benefit of RoDTEP scheme to all goods, with effect from 1 January 2021, according to a notification by the Directorate General of Foreign Trade (DGFT).

“The Centre has today (Tuesday) notified the RoDTEP guidelines and rates. The rates will cover 8,555 tariff lines (products),” the Commerce Ministry said in a statement. It has also notified guidelines for the scheme. Under the RoDTEP, various central and state duties, taxes, levies imposed on input products among others are refunded to exporters to boost exports. Identified export sectors and rates under RoDTEP cover 8,555 tariff lines in addition to similar support being extended to apparel and made-ups exports under RoSCTL scheme of the Ministry of Textiles.

Employment oriented sectors like marine, agriculture, leather, gems & jewellery etc. are covered under the scheme. Other sectors like automobile, plastics, electrical/electronics, machinery etc. also get support. The entire valve chain of textiles also gets covered through RoDTEP & Rebate of State and Central Levies and Taxes (RoSCTL).

The credit rating agency, CRISIL on Wednesday, 18 August 2021, upgraded India Inc’s credit quality outlook for FY22 from “cautiously optimistic” to “positive”, based on continued improvement in demand. This comes after the setbacks caused by the second wave of the Coronavirus pandemic in Q1 of FY22. “Increasing vaccination coverage should also reduce the impact of the third wave if it comes,” CRISIL said in a statement.

CRISIL Ratings Chief Rating Officer Subodh Rai said the outlook revision factor in strong economic growth, both domestic and global, and containment measures that are localised and less stringent compared with the first wave. This should sustain the pick-up in domestic demand even if the third wave hits. “We believe that India Inc is on a high and strong footing,” he said.

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