Indian Indices Witness Buying, Fed's Policy and the US Economy, Stocks in Focus, and Top Cues to Track Today

Mon, 4 May Pre-Open

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Indian share markets ended on a strong note on Friday last week.

Auto and metal stocks surged amid hopes of improvement in demand as major world economies started resuming business activities and lifting restrictions imposed in the wake of the coronavirus pandemic.

Benchmark indices registered their best month in nearly 11 years on Friday, buoyed by news of a possible breakthrough in testing for a treatment of Covid-19.

Reportedly, Gilead's antiviral Remdesivir in early clinical trials seemed to show it helped speed recovery in Covid-19 patients.

Besides, the government's announcement to give considerable relief to many districts post May 4 boosted sentiment.

At the closing bell on Friday, the BSE Sensex stood higher by 997 points (up 3.1%) and the NSE Nifty closed higher by 307 points (up 3.2%).

The BSE Mid Cap index ended up by 1.5%, while the BSE Small Cap index ended up by 1.2%.

On the sectoral front, gains were largely seen in the metal sector, auto sector and IT sector.

Apurva Sheth, in his latest video, talks about the recent rally in markets and what to expect going forward.

He talks about some important market indicators which will determine whether this rally will continue or not.

You can check the same here: Will the Market Rally Continue?

Also, speaking of Indian share markets, the coronavirus impact has shaken markets worldwide. Indian stock markets have felt the full impact too.

For the BSE Sensex, FY20 was the second worst year post FY08, the year of the global financial crisis.

Good Time to Start Investing Now?

Naturally, there is an atmosphere of fear all round.

Is it time to sell stocks now? Will the correction get worse?

History has shown that after years like the one we had just now, the next 3 years are good for the markets. In fact, these corrections are the rare times when you find businesses with solid fundamentals at reasonable valuations.

If you can find good businesses that can survive the current crisis, you will do well in the long run.

Our special report, How to Trade the Coronavirus Crash, is the most comprehensive report on how to trade the coronavirus, both from a short-term and long-term perspective. You can claim your FREE copy here...

Top Stocks in Focus Today

Market participants will be tracking HUL share price, Reliance Industries share price and Tech Mahindra share price as these companies announced their March quarter results (Q4FY20) last week.

You can read our recently released Q4FY20 results of other companies here: Wipro, TCS, Infosys, HDFC Bank, Tata Elxsi, ACC, CRISIL, Ambuja Cement, IndusInd Bank, Axis Bank.

From the pharma sector, Lupin share price will be in focus as the company last week announced that it has received tentative approval for its Arformoterol Tartrate Inhalation Solution from the US drug regulator. The drug was approved by the United States Food and Drug Administration (USFDA) to market a generic version of Brovana Inhalation Solution, 15 mcg/2 mL of Sunovion Pharmaceuticals Inc. (Sunovion).

Speaking of the pharma sector, in December 2019, co-head of Research at Equitymaster, Tanushree Banerjee had predicted that pharma could be the sector to see a big rebound in 2020.

And rightly so, most pharma companies have re-emerged as the safer bets for investors in the ongoing market turmoil. Earlier this month, the Indian rupee touched a new record low of Rs 76.92 against the US dollar. Most pharma companies generate their revenues through exports. Hence, a depreciating rupee is a positive development for them.

As per Tanushree, in a post Covid-19 world, healthcare expenditures globally will see a big rejig.

Fed's Take on the US Economy

In news from the global financial markets, the Federal Reserve last week left interest rates near zero and repeated a vow to do what it takes to shore up the US economy amid an ongoing coronavirus pandemic.

In a statement, the central bank said, "The Federal Reserve is committed to using its full range of tools to support the US economy in this challenging time, thereby promoting its maximum employment and price stability goals."

The Fed said it expects to maintain the target range for its benchmark overnight lending rate at the current 0% to 0.25% until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.

It also said it will continue to buy US Treasuries and agency residential and commercial mortgage-backed securities in the amounts needed to support smooth markets, and to offer large-scale overnight and term repurchase agreement operations.

The US economy has gone from historically low unemployment to seeing more than 26 million people file for unemployment benefits and the sharpest plunge in activity since the Great Recession.

The meeting was the first held by the Fed since it took emergency steps in March and April to stabilize financial markets, slashing interest rates to near zero and throwing a credit lifeline to businesses and local governments.

US stock markets were lifted by the Fed's commitment, and by optimism that economies will recover as lockdowns are eased soon.

What effect this decision has on the US economy and global stock markets remains to be seen. Meanwhile, we will keep you updated on all the developments from this space.

New Business Premium for Life Insurance Companies Tank

New business premium for life insurance companies tanked 32% in March to Rs 254.1 billion compared with Rs 374.6 billion in March 2019, according to data published by the Insurance Regulatory and Development Authority of India (Irdai).

Life Insurance Corporation of India (LIC) reported a dip of 31% in new premium income in March compared to the same month last year.

However, for the financial year, the new business premium for life insurance companies grew at 26.60%.

Speaking of the insurance sector, India's life insurance penetration i.e. insurance premiums as a percentage of GDP, is very low compared to the global average.

The industry is expected to grow at a CAGR of 11-13% over the next five years. India's large youth population and growing awareness about insurance is bound to accelerate growth.

As per Tanushree Banerjee, this is one of the megatrends that will help what she calls the Rebirth of India.

She has identified the 7 best stocks that will profit from the Rebirth of India. You can read about these top 7 stocks here.

To know what's moving the Indian stock markets today, check out the most recent share market updates here.

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

Read the latest Market Commentary

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INDICESBSE (Rs 0 to 1)BSE (Rs 1 to 2)BSE (Rs 2 to 4)BSE (Rs 4 to 10)BSE (Rs 10 to 20)BSE (Above Rs 20)BSE - AllBSE-30BSE-100BSE-200BSE-500BSE AutoBSE BankexBSE Capital GoodsBSE Consumer DurablesBSE FMCGBSE HealthcareBSE ITBSE MetalBSE Oil & GasBSE PSUBSE TeckBSE RealtyBSE PowerBSE A GroupBSE B GroupBSE Mid-CapBSE Small-CapBSE Basic MaterialsBSE Consumer DiscretionaryBSE IndustrialsBSE UtilitiesBSE Sensex 50BSE Sensex Next 50BSE Bharat 22BSE 150 MidCapBSE 250 SmallCapBSE 250 LargeMidCapBSE 400 MidSmallCapBSE AllCapBSE LargeCapBSE SmallCap SelectBSE 100 LargeCap TMCBSE InfraBSE ManufacturingBSE CPSEBSE Private BankBSE Diversified FinancialsBSE MomentumBSE Low VolatilityBSE QualityBSE Enhanced ValueBSE Divident StabilityS&P BSE IPOBSE SMEIPOBSE 100 ESGBSE CarbonexBSE GreenexNSE (Rs 0 to 10)NSE (Rs 10 to 20)NSE (Above Rs 20)NSE - AllNSE-50NSE ITNSE Nifty Midcap 50NSE JR. NiftyNSE Bank NiftyNIFTY Next 50NIFTY 100NIFTY 200NIFTY 500NIFTY MidCap 100NIFTY SmallCap 250NIFTY SmallCap 50NIFTY SmallCap 100NIFTY LargeMidCap 250NIFTY MidSmallCap 400NIFTY AutoNIFTY Consumer DurablesNIFTY FinanceNIFTY FMCGNIFTY MediaNIFTY MetalNIFTY PharmaNIFTY Private BankNIFTY PSU BankNIFTY RealtyNIFTY Oil & GasNIFTY SME EmergeNIFTY CommoditiesNIFTY CPSENIFTY EnergyNIFTY India ConsumptionNIFTY InfraNIFTY MNCNIFTY PSENIFTY Serv SectorNIFTY100 Liquid 15NIFTY Midcap Liquid 15NIFTY Midcap 150 Quality 50NIFTY50 Equal WeightNIFTY100 Equal WeightNIFTY100 Low Volatility 30NIFTY100 Alpha 30NIFTY Alpha 50NIFTY Dividend Opportunities 50NIFTY High Beta 50NIFTY Low Volatility 50NIFTY200 Quality 30NIFTY 500 Value 50NIFTY 100 Quality 30SECTORSAgricultureAirlinesAluminiumAsset Management CompaniesAutomobilesAuto AncillariesBanks (Private)Banks (PSU)BankingCementChemicalsDefenceDiagnosticsDronesEngineeringElectric VehicleElectric Vehicle BatteryEnergy SourcesESGEthanolFertilizersFintechFMCGFoodGreen HydrogenHotelsInfrastructureInsuranceInvestment and FinanceInvITIT (Large)IT (Others)LogisticsMediaMetalMiningIndia's Big Tech StocksIndian PharmaMNC PharmaPSUPaintPaperPlasticPowerRating AgenciesReal EstateREITsRenewable EnergyRetailingSemiconductorShippingSteelSugarSupply ChainTelecomTextilesTravel Support Services

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Indian Share Market Update: Top Gainers and Losers