4 Reasons Why Sensex Rallied 767 Points Today

Fri, 12 Nov Closing

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Indian share markets witnessed positive trading activity throughout the day today and ended on a strong note.

Benchmark indices snapped their 3-day losing streak with strong gains led in IT shares and select index heavyweights.

At the closing bell, the BSE Sensex stood higher by 767 points (up 1.3%).

Meanwhile, the NSE Nifty closed higher by 229 points (up 1.3%).

Tech Mahindra and Hindalco were among the top gainers today.

Bajaj Auto and Tata Steel, on the other hand, were among the top losers today.

The SGX Nifty was trading at 18,136, up by 239 points, at the time of writing.

The BSE Mid Cap index and the BSE Small Cap index ended up by 0.6% and 0.3%, respectively.

Shares of L&T Infotech and Minda Industries hit their respective 52-week highs today.

US stock futures are trading on a flat note today with the Dow Futures trading up by 38 points.

The rupee is trading at 74.44 against the US$.

Gold prices for the latest contract on MCX are trading down by 0.3% at Rs 49,051 per 10 grams.

Here are 4 Factors Why the Stock Market Zoomed Today

Positive Global Cues: Major global markets rose today and the positive sentiment spilled to the Indian bourses too.

Asian stocks ended on a positive note as investors are now hopeful that the worst price hikes could be soon over.

The Hang Seng and the Shanghai Composite ended up by 0.3% and 0.2%, respectively. The Nikkei ended up by 1.1% in today's session.

Better Earnings: The current market rally was supported by better earnings from Hindalco, Abbott India and Tata Steel.

Drug maker Abbott India reported a 6.4% rise in its net profit to Rs 1.9 bn for the quarter-ended 30 September 2021, on account of robust sales.

While, Tata Steel, the country's oldest steel producer reported a consolidated net profit at Rs 119.2 bn in the September quarter, up nearly eightfold or 6615 from the same period last year.

Economic Revival: Union Finance Minister Nirmala Sitharaman will on Monday meet chief ministers and state finance ministers to discuss measures to attract private investments to help boost the economy.

Speaking to reporters, Finance Secretary T V Somanathan said the meeting comes in the backdrop of strong economic recovery post the two Covid waves, and the central government has made a big push in capex.

Sectoral Gains: Market participants bought shares across the board with IT, telecom and realty - all indices witnessing strong gains today.

We will keep you updated on how these factors develop in the coming days and what effect they have on Indian stock markets. Stay tuned!

Speaking of stock markets, India's #1 trader Vijay Bhambwani shares his thoughts on taking up day trading as a profession, in his latest video for Fast Profits Daily.

Tune in to the video below to find out more:

In news from the aluminium sector, Hindalco was among the top buzzing stocks today.

Hindalco Industries reported a 783% year on year (YoY) rise in consolidated net profit at Rs 34.2 bn, the highest ever quarterly profit in the company's history.

The company posted a 52.6% YoY jump in consolidated revenue from operations to Rs 476.7 bn.

Satish Pai, managing director at Hindalco Industries said,

• Our record-breaking performance this quarter is an affirmation of our fully integrated business model, which powers our performance in both upstream and downstream markets.

The strong performance of the company was largely down to the record-breaking show from arm Novelis, which reported a 38% YoY rise in revenues at US$4.1 bn.

Novelis also reported record quarterly operating profit of US$553 m, which was higher by 22% when compared to year ago quarter.

Novelis once again achieved a record earnings before interest, taxes, depreciation, and amortization (EBITDA) per ton driven by higher volumes and favourable metal prices.

At home, the India aluminium business had a trailblazing quarter with record high operating profits. The aluminium business saw its adjusted operating profit rise 173% YoY to Rs 32.5 bn while its operating margins hit a decade high of 42% in the reported quarter.

Overall, the Indian business reported a record high quarterly net profit of Rs 18.2 bn, up 455% YoY. The business also reported record operating profit of Rs 37.2 bn, which rose 152% YoY.

Hindalco said that its quarterly performance was largely driven by favourable macroeconomic conditions, strategic product mix, higher volumes and stability in operations.

Hindalco share price ended the day up by 3.2% on the BSE.

Moving on to news from the healthcare sector...

Max Healthcare Witnesses Multifold Jump in Net Profit

Max Healthcare Institute reported a multifold jump in its consolidated net profit to Rs 1.4 bn for the quarter ended 30 September 2021, mainly on account of a rise in revenue from elective surgeries and improved out patient department (OPD) footfalls.

The company had posted a net profit of Rs 166.5 m for the same period of the previous fiscal.

Its consolidated revenue from operations during July-September 2021 stood at Rs 10.2 bn. It had stood at Rs 6.5 bn in the same period a year ago.

Max Healthcare Institute Chairman and MD Abhay Soi said,

• The second quarter saw the normalisation of revenues after the second wave of coronavirus infections.
  
  While occupancy and vaccination-related revenues were lower than the previous quarter, this was more than compensated by growth in average revenue per occupied bed (ARPOB) post return of elective surgeries and improved OPD footfalls.

However, medical tourism continues to be at a third of pre-Covid levels, and the company expects this to normalise in the coming quarter, he added.

Max Healthcare share price ended the day up by 3.1% on the BSE.

Speaking of the stock markets, a right investing process can help you win in the long term. It might offer some unexpected and undesirable results in the short term but lets you fare well when you average the outcomes.

According to Richa Agarwal, Senior Research Analyst at Equitymaster, any investment process should not be judged based on individual outcomes. Instead, it should have stood the test of the time.

Her smallcap service Hidden Treasure has had its fair share of failures. But sticking to a disciplined process meant that Hidden Treasure's internal rate of return (IRR) increased to 24.38% since inception. This compares favourably to the IRRs of 9.6% for the Sensex, and 8.8% for the smallcap index in the same period (February 2008 - June 2020) as can be seen in the chart below.

The service's performance did suffer in the short term after the 2018 crash in smallcaps. However, the long term track record and the post Covid rebound underscores the strength of stock picking process.

If you are interested in becoming a Hidden Treasure subscriber, here's where you can sign up.

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!

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