The domestic stock market ended with strong gains on Friday after the Reserve Bank of India's Monetary Policy Committee decided to maintain its status quo on interest rate. IT shares and PSU banks rallied while realty shares tumbled. Global stock markets were mixed ahead of US jobs data due later in the day.

The barometer index, the S&P BSE Sensex, advanced 381.23 points or 0.64% to 60,059.06. The Nifty 50 index added 104.85 points or 0.59% to 17,895.20.

The NSE's India VIX, a gauge of market's expectation of volatility over the near term, slumped 3.11% to 15.65.

In the broader market, the S&P BSE Mid-Cap index rose 0.15% while the S&P BSE Small-Cap index gained 0.83%.

The market breadth was positive. On the BSE, 1,847 shares rose and 1,458 shares fell. A total of 148 shares were unchanged.

RBI's six-member Monetary Policy Committee (MPC) at its meeting today (8 October 2021) decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 4%. The reverse repo rate under the LAF remains unchanged at 3.35% and the marginal standing facility (MSF) rate and the bank rate at 4.25%.

The MPC also decided to continue with the accommodative stance as long as necessary to revive and sustain growth on a durable basis and continue to mitigate the impact of COVID-19 on the economy, while ensuring that inflation remains within the target going forward.

These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4% within a band of +/- 2%, while supporting growth, RBI statement said.

Air India Stake Sale:

The Tata Group will take over state-owned Air India. Talace Pvt. Ltd., the SPV of Tata Sons, will pay Rs 18,000 crore to acquire Air India from the government. Of the total money 15% will go to the government and the rest will go in clearing debt. Transaction to be closed by December 2021.

India's state-run banks, which have major exposure to Air India, rose across the board. The Nifty PSU Bank index rose 1.65% to 2,550.

Numbers to Track:

MCX Gold futures for 3 December 2021 settlement rose 0.20% to Rs 46,920.

The yield on India's 10-year benchmark federal paper (06.10 GS 2031) was currently at 6.3164% as compared with its previous closing of 6.267%.

In the commodities market, Brent crude for December 2021 settlement advanced 69 cents or 84% to $82.64 a barrel.

In the foreign exchange market, the partially convertible rupee fell to 74.99 from its previous closing of 74.79.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, was down 0.09% to 94.13.

The yield on the benchmark 10-year U.S. Treasury note stood at 1.596%, lifted by the prospects of tighter monetary policy.

Global Markets:

Most European shares declined while most Asian stocks advanced. Chinese stocks jumped on the first day of trade after a week-long holiday.

Investors eyed key US jobs data for any fresh insight into the timing of Federal Reserve tapering.

Activity in China's services sector returned to growth in September as a major COVID-19 outbreak in the eastern province of Jiangsu receded, a private-sector survey showed on October 8. The Caixin/Markit services Purchasing Managers' Index (PMI) rose to 53.4 from 46.7 in August.

US stocks rallied on Thursday as Senate leaders moved to avert a US debt default. Senate Majority Leader Chuck Schumer announced Thursday that lawmakers have reached a deal on a short-term debt ceiling increase after hours of discussion with Minority Leader Mitch McConnell.

Markets will look ahead to Friday's key September jobs report as the Federal Reserve prepares to slow its $120 billion-per-month bond-buying program.

Buzzing Segment:

Shares of hotel companies were in demand after the Indian government announced that it will start issuing tourist visas from 15 October 2021.

Kamat Hotels (up 16.98%), Lemon Tree Hotel (up 6.94%), Asian Hotels (N) (up 3.53%), Indian Hotels Co (up 3.29%), EIH Associated Hotels (up 3.13%), Asian Hotels (W) (up 2.58%), TajGVK Hotels (up 2.01%), EIH (up 1.24%), Asian Hotels (E) (up 1.10%), ITDC (up 0.74%) and Chalet Hotels (up 0.15%) surged.

India's Ministry of Home Affairs (MHA) on Thursday said it will begin granting fresh tourist visas to foreigners coming to India through chartered flights with effect from 15 October 2021. Foreign tourists traveling to India by flights other than chartered aircraft will be able to do so with effect from 15 November 2021.

With this, the restrictions placed on visa and international travel stand further eased given the present overall COVID-19 situation, the home ministry statement added.

Stocks in Spotlight:

IT major TCS rose 1.10% ahead of its Q2 results today, 8 October 2021. The stock hit a record high of Rs 3990 in mid-morning trade today.

Infosys (up 1.91%) will announce Q2 results on Wednesday, 13 October 2021.

Reliance Industries (RIL) added 3.84%. RIL on Thursday announced the launch of its premium retail destination, Jio World Drive (JWD), in Mumbai's Bandra Kurla Complex. It will be home to prominent international and Indian brands, 27 culinary outlets, Mumbai's first rooftop Jio Drive-In Theatre, an open-air weekend community market, pet-friendly services, a dedicated pop-up experience and other services.

JSW Energy gained 0.7%. The company has signed a contract with GE Renewable Energy for supply of 810 MW of onshore wind turbines for the company's underconstruction pipeline of approximately 2.5 GW of renewable projects in India. The supply of the turbines will start by the second quarter of CY2022.

K P I Global Infrastructure jumped 7.06%. The company informed that it signed a new long-term Power Purchase Agreement (PPA) with GHCL, Bhilad for sale of 1.25 MW solar power for a period of 20 years under Independent Power Producer (IPP) business vertical.

Tata Motors rose 1.74%. The media reported that the auto major is seeking to buy Ford's units in Tamil Nadu and Gujarat states. According to reports, Ford's manufacturing plants could help Tata Motors augment capacity as it focuses on eco-friendly vehicles.

Separately, the media reported that TPG is in advanced talks with the Tata group to invest $1 billion-$1.5 billion in its electric vehicle unit. The group is also in talks with several Middle East-based sovereign wealth funds (SWFs) such as Abu Dhabi Investment Authority and Saudi Arabia's PIF to come as anchor investors on the deal, the report added.

Bajaj Auto shed 0.37%. The auto major on Friday announced the resignation of Soumen Ray as the company's chief financial officer with effect from 20 December 2021. The company further added that it is in the process of identifying and appointing a suitable person for the said position.

Shares of Multi Commodity Exchange Of India (MCX) surged 5.56% to Rs 1923.80. Shares of Indian Energy Exchange (IEX) rose 8.86% to Rs 696.95.

The Union power ministry said on Thursday that the Supreme Court has approved the introduction of new market instruments for electricity trading as per the terms mutually agreed between the Central Electricity Regulatory Commission (CERC) and the Security Exchange Board of India (SEBI).

CERC and SEBI had earlier moved to the Supreme Court to ascertain who will regulate electricity derivatives trading. Based on the recommendations, both SEBI and CERC have come to an agreement that CERC will regulate all the physical delivery based forward contracts whereas the financial derivatives will be regulated by SEBI.

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