Equity indices ended with steep losses on Wednesday, sliding for the second trading session. The Nifty closed below the 14,700 mark. PSU banks and auto shares bucked weak market trend while private banks and metal shares tumbled. Investors were concerned that rising commodity prices and inflationary pressure could push up global interest rates sooner than expected.

The barometer index, the S&P BSE Sensex, dropped 471.01 points or 0.96% at 48,690.80. The Nifty 50 index lost 154.25 points or 1.04% at 14,696.50. Both the indices have corrected about 1.65% in two consecutive sessions.

Hindustan Unilever (down 3.07%), ICICI Bank (down 2.43%), Axis Bank (down 2.23%), Kotak Mahindra Bank (down 2.12%) and Reliance Industries (down 1.04%) were major drags.

Trading was volatile due to expiry of weekly index options on the NSE today. Indian stock markets will remain shut tomorrow, 13 May 2021, on account of Id-Ul-Fitr (Ramzan Id).

In the broader market, the BSE Mid-Cap index fell 0.90% and the BSE Small-Cap index skid 0.62%.

The market breadth was positive. On the BSE, 1,586 shares rose and 1,488 shares fell. A total of 159 shares were unchanged.

COVID-19 Update:

Total COVID-19 confirmed cases worldwide stood at 15,97,03,471 with 33,18,053 deaths. India reported 37,04,099 active cases of COVID-19 infection and 2,54,197 deaths while 1,93,82,642 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.

India lost 4,205 people to the coronavirus pandemic in the last 24 hours, said the government data released on Wednesday morning. This is the highest-ever death count that India has ever seen in a single day since the pandemic began in 2020. This is the third time in the span of 10 days that India has officially recorded over 4,000 deaths in 24 hours. India had seen over 4,000 deaths on 8 May 2021. On 9 May 2021, the second day in a row, India reported 4,092 deaths.

Economy:

Amid a strong second COVID-19 wave, Moody's cut India's FY22 GDP growth forecast. The rating agency slashed the projection to 9.3% for FY22 from earlier forecast of 13.7%. It also ruled out a sovereign rating upgrade, at least for now.

However, the UN has raised India's growth forecast to 7.5% for calendar year 2021, a 0.2% increase from its projection in January 2021. The country's outlook for the year, remained highly fragile, it said. The World Economic Situation and Prospects report released on Tuesday, 11 May 2021, also projected India's GDP to grow by 10.1% in 2022.

Numbers to Watch:

The yield on 10-year benchmark federal paper rose to 6.010% as compared with 6.008% at close in the previous trading session.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 73.4225, compared with its close of 73.34 during the previous trading session.

MCX Gold futures for 4 June 2021 settlement rose 0.03% to Rs 47,645.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, rose 0.11% to 90.24.

In the commodities market, Brent crude for July 2021 settlement rose 71 cents at $69.26 a barrel. The contract rose 23 cents, or 0.34% to settle at $68.55 a barrel in the previous trading session.

Foreign Markets:

European shares traded higher while Asian stocks were mixed on Wednesday, 12 May 2021 as investors remain cautious over growing inflation worries. In Asia, Taiwan Weighted index slumped 4.11%.

US stocks dropped on Tuesday amid speculation that rising inflation pressure could prompt interest rate hikes sooner than expected.

Buzzing Indian Segment:

The Nifty PSU Bank index jumped 3.24% to 2,239.70. The index has risen 5.83% in three sessions.

Punjab & Sind Bank (up 9.95%), UCO Bank (up 8.55%), Central Bank of India (up 7.89%), PNB (up 5.85%), Union Bank of India (up 5.81%), Indian Bank (up 4.85%), Bank of India (up 4.76%), Bank of Baroda (up 4.66%), Jammu & Kashmir Bank (up 3.15%), Indian Overseas Bank (up 3.13%), Bank of Maharashtra (up 2.21%), Canara Bank (up 1.27%) and SBI (up 0.85%) advanced.

Stocks in Spotlight:

Ambalal Sarabhai Enterprises (ASE) hit an upper circuit of 20% at Rs 33.40 after the company said that its subsidiary, Synbiotics, has ramped up the production of API Amphotericin B.

India is witnessing an outbreak of Mucormycosis - a very fast spreading fungal infection especially for post-COVID infection and recovery because of low immune system in the patients. The most recommended treatment for this infection is 'Amphotericin B' injection.

Godrej Consumer Products surged 22.19% to Rs 874.80 after the FMCG company's consolidated net profit rose 59.1% to Rs 365.84 crore on 26.9% jump in net sales to Rs 2,705.69 crore in Q4 FY21 over Q4 FY20. Profit before tax soared 25.8% to Rs 424.41 crore in Q4 March 2021 as against Rs 337.39 crore in Q4 March 2020. EBITDA galloped 21% Y-o-Y in Q4 March 2021 over Q4 March 2020. EBITDA margins stood at 21.2%, a decrease of 110 bps year-on-year, driven by drop in India and Latin America & SAARC margins.

The India sales grew 35% to Rs 1,466 crore in Q4 FY2021 over Q4 FY2020 while the volume jumped 29% during the period under review. Overseas, Indonesia sales growth recorded 5% rise (in INR) and 4% in constant currency terms, Y-o-Y (year-on-year). Africa, USA and Middle East sales registered 30% growth (in INR) and 36% in constant currency terms, Y-o-Y. Latin America & SAARC sales jumped 30% (in INR) and 54% in constant currency terms, Y-o-Y.

Siemens jumped 2.81% after the company reported 90.8% jump in standalone net profit to Rs 328.30 crore in Q2 March 2021 as against Rs 172.10 crore in Q2 March 2020. Net sales during the quarter increased 29.7% year-on-year (YoY) to Rs 3298.30 crore in Q2 March 2021. Profit before tax from continuing operations in Q2 March 2021 stood at Rs 433 crore, an increase by 94.8% over the same period last year. In the second quarter, the company registered new orders from continuing operations of Rs 3,309 crore, registering a 16.9% increase over the same period last year. The company's order backlog stands at Rs 12,677 crore.

KEC International rose 0.18%. On a consolidated basis, the EPC company reported a 0.7% rise in net profit to Rs 194.30 crore on 18.8% increase in net sales to Rs 4,360.54 crore in Q4 FY21 over Q4 FY20. Profit before tax declined 1.3% to Rs 265.66 crore in Q4 FY21 from Rs 269 crore posted in Q4 FY20. EBITDA fell 4.3% to Rs 355 crore in Q4 FY21 from Rs 371 crore in Q4 FY20. EBITDA margin declined to 8.1% in Q4 FY21 as against 10.1% in Q4 FY20.

Kalpataru Power Transmission rose 0.18%. On a consolidated basis, the company's net profit spurted 1338.5% to Rs 187 crore on 16% increase in net sales to Rs 4,086 crore in Q4 FY21 over Q4 FY20. EBITDA grew 15% Y-o-Y (year-on-year) to Rs 445 crore in Q4 FY21 over Q4 FY20 with EBITDA margin at 10.9% during the quarter. Profit before Tax (PBT) (after exceptions) surged 199% to Rs 283 crore in Q4 FY21 from Q4 FY20 with PBT (after exceptions) margin at 6.9%. The net debt stood at Rs 2,304 crore as on 31 March 2021 as compared to Rs 3,458 crore as on 31 March 2020, registering a 33.37% Y-o-Y fall. Consolidated order book was at Rs 27,900 crore as on 31 March 2021 and L1 at Rs 2,300 crore.

Huhtamaki India tumbled 5.13% after the company's net profit declined 40.8% to Rs 16.17 crore in Q1 March 2021 from Rs 27.31 crore in Q1 March 2020. “Profitability for the quarter was impacted by the unprecedented increase in raw material prices,” the company said in a statement. Net sales rose 9.3% to Rs 620.52 crore in the first quarter compared with the same period last year, driven by growth in volume. Profit before tax in Q1 March 2021 stood at Rs 19.86 crore, down 17.9% from 24.18 crore recorded in Q1 March 2020.

Linde India fell 2.94%. On a consolidated basis, the company's net profit soared 677% to Rs 303.24 crore in Q1 March 2021 from Rs 39.03 crore in Q1 March 2020. Net sales during the quarter increased by 17% year-on-year (YoY) to Rs 441.42 crore. On the segmental front, revenue from Gases and related products was Rs 380.60 crore (up 23.9% YoY) while that from Project engineering was Rs 63.25 crore (down 10.3% YoY) in Q1 March 2021. Profit before tax jumped to Rs 385.45 crore in the first quarter, up 581.1% from Rs 56.59 crore reported in the same period last year.

Saregama India fell 4.92%. The company reported 151% jump in consolidated net profit to Rs 37.2 crore in Q4 FY21 as against Rs 14.8 crore in Q4 FY20. Revenue from operations increased 14% year-on-year (YoY) to Rs 123.5 crore. Among segments, revenue from Music business was Rs 101.3 crore (up 10% YoY), revenue from TV & Films business was Rs 21 crore (up 27% YoY) and revenue from Publication business was Rs 1.2 crore (up 140% YoY) in the fourth quarter. Profit before tax in Q4 FY21 stood at Rs 50.3 crore, up by 126% from Rs 22.3 crore reported in Q4 FY20.

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