Domestic shares soared on Tuesday, amid positive global cues, buoyed by tentative signs the coronavirus crisis could be slowing. The barometer index, the S&P BSE Sensex, spurted 2,476.26 points or 8.97% at 30,067.21. The Nifty 50 index added 708.40 points or 8.76% at 8,792.20.

Buying was also triggered by hopes that India may attract about Rs 9,900 crore in passive flows as the country has moved into a new regime in which the FPI limit has been increased to the sector foreign limit.

Sentiment also received a boost after media reports suggested that the government could consider a phased exit from the national lockdown. Authorities are reportedly examining a proposal to partially lift restrictions in low-risk states and districts while continuing with stringent curbs in areas with the maximum number of cases.

The NSE's India VIX, a gauge of market's expectation of volatility over the near term, tumbled 5.86% to 52.06. The VIX is has correct by 39.91% from its 52-week high of 86.64 recorded on 24 March 2020.

According to data from John Hopkins University, the number of confirmed cases of the coronavirus worldwide on Tuesday surpassed 1.35 million resulting in more than 74,000 deaths so far. Active coronavirus cases in India stood at 4,340 while 136 people have died from the infection.

In the broader market, the BSE Mid-Cap index jumped 5.40% and the BSE Small-Cap index gained 4.13%. Both these indices underperformed the Sensex.

The market breadth was strong. On the BSE, 1843 shares rose and 539 shares fell. A total of 194 shares were unchanged.

Economy:

The IHS Markit India Services Business Activity Index recorded 49.3 in March, down from February's 85-month high of 57.5. According to panel members, business activity was reduced in response to weaker demand. The global COVID-19 pandemic reportedly led a fall in new orders from clients, particularly overseas.

Numbers to Watch:

The yield on 10-year benchmark federal paper rose to 6.418% compared with 6.306% at close in the previous trading session.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 75.64, compared with its close of 76.13 during the previous trading session.

In the commodities market, Brent crude for June 2020 settlement rose 89 cents at $33.94 a barrel. The contract fell $1.06, or 3.11% to settle at $33.05 a barrel in the previous trading session.

Foreign Markets:

European shares extended gains while Asian stocks ended higher on Tuesday on rising hopes the spread of the global coronavirus pandemic may be slowing.

South Korea reported less than 50 new cases of infection for the second day on Tuesday. China on Tuesday reported no new deaths from the coronarivus over the past 24 hours and had 32 new cases, all from people who returned from overseas. The number of new coronavirus cases is dropping in the European hotspots of Italy and Spain. The center of the US outbreak, New York, also reported its number of daily deaths has been effectively flat for two days.

In US, stocks rocketed higher, after a fall in the daily death toll in New York, the country's biggest coronavirus hot spot, fueled optimism a leveling off of the pandemic was on the horizon.

Buzzing Index:

The Nifty Pharma index jumped 10.43% to 8,129.15. The index climbed 15.69% in two trading sessions.

Aurobindo Pharma (up 16.52%), Dr. Reddy's Laboratories (up 14.6%), Cadila Healthcare (up 13.62%), Sun Pharmaceutical Industries (up 10.96%), Ipca Laboratories (up 10.06%), Cipla (up 9.54%), Divis Laboratories (up 8.07%), Wockhardt (up 7.99%), Lupin (up 6.91%), Glenmark Pharma (up 6.84%), Abbott India (up 5.66%), Strides Pharma (up 3.3%), Alkem Labs (up 2.63%) and GlaxoSmithKline Pharmaceuticals (up 1.87%), advanced.

Pharma stocks were in demand after the government allowed export of select active pharmaceutical ingredients (API), including antibiotics, vitamins and hormones as well as their formulations, that were placed under restriction early last month. The government had imposed the restrictions last month as the coronavirus outbreak disrupted global supply chains.

Further, India will also supply paracetamol and hydroxychloroquine in appropriate quantities to all neighbouring countries and nations who badly need the medicines in wake of coronavirus crisis. The export of hydroxychloroquine and paracetamol will be now taken up on a 'case-to-case basis', depending on the availability of stock after meeting domestic requirements, reports suggested.

Hydroxychloroquine tablet is used to prevent and treat malaria, lupus and rheumatoid arthritis, among other ailments, while paracetamol is used to treat pain and fever. The United States has been touting hydroxychloroquine as a potential drug that can cure Coronavirus.

The Nifty Bank index jumped 10.42% to 19,046.35. The index fell 9.90% in the past two trading sessions.

Among public sector banks, State Bank of India (up 6.15%), Punjab & Sind Bank (up 3.7%), Canara Bank (up 3.15%), Indian Bank (up 2.46%), Bank of Maharashtra (up 2.15%) and IDBI Bank (up 1.79%) jumped.

Among private sector banks, Axis Bank (up 19.41%), ICICI Bank (up 13.82%), Federal Bank (up 7.01%), RBL Bank (up 4.73%), City Union Bank (up 1.90%) and Yes Bank (up 1.87%) soared.

IndusInd Bank jumped 22.60%. The bank said advances grew 13% year-on-year and stood at Rs 209,914 crore as of 31 March 2020 from Rs 186,393 posted on 31 March 2019. Bank's deposits registered a 4% YoY growth and stood at Rs 202,303 crore as on 31 March 2020 as compared to Rs 194,868 crore reported on 31 March 2019. Bank CASA Ratio declined to 40.5% in 31 March 2020 from 43.1% posted on 31 March 2019.

HDFC Bank climbed 10.18%. The bank on Friday (3 April 2020) said its advances grew 21% while its deposits rose 24% as of 31 March 2020 compared with corresponding period of the previous year. HDFC Bank's advances aggregated to approximately Rs 9,93,000 crore as of 31 March 2020, a rise of 21.19% against Rs 8,19,400 crore as of 31 March 2019 and a growth of 6.09% compared with Rs 9,36,000 crore as of 31 December 2019.

Kotak Mahindra Bank rose 5%. The bank on Monday (6 April 2020) said that its total customer deposits rose 19.6% to Rs 258,500 crore as on 31 March 2020 as against Rs 216,150 crore as on 31 March 2019. Total customer deposits grew 11.7% as on 31 March 2020 from Rs 231,251 crore as on 31 December 2019.

Stocks in Spotlight:

Hindustan Unilever (up 13.51%), Maruti Suzuki India (up 13.41%), HCL Technologies (up 12.42%), Nestle India (up 12.14%), Bajaj Auto (up 12.05%) and Reliance Industries (up 11.89%) were among the major gainers.

Bajaj Finance rose 2.07%. The NBFC on Monday (6 April 2020) reported a 22% sequential fall in new loans booked during Q4 March 2020 to 6 million due to the national lockdown. New loans booked during Q4 March 2020 was 6.0 million (MM) as compared to 5.8 MM in Q4 March 2019 and 7.7 MM in Q3 December 2019. The company lost about 1 MM accounts on account of nationwide lock down. On a year-on-year basis, the growth under new loans booked slowed down to 3% in Q4 March 2020 compared to a growth of 53% during Q4 March 2019.

Larsen & Toubro (L&T) advanced 3.46% after a unit of L&T Construction secured a large order from the Indian Army for unified network management system. As per the L&T's classification, the valuation of the 'large' order stands between Rs 2,500 and 5,000 crore. The announcement was made during market hours today, 7 April 2020.

Meanwhile, on Friday (3 April), depository institutions CDSL and NSDL notified changes to the foreign investment limits in individual companies, raising the same to their respective sectoral caps. Higher foreign investment limits in Indian companies would lead to MSCI (Morgan Stanley Capital Investment) to raise Indian companies' weightage on its indices. L&T is one of the stocks which could see an increase in MSCI weightage.

Moreover, L&T on Monday (6 April) said its board will meet on 9 April 2020 to consider raising funds, including through issue of debt securities.

JSW Steel added 13.04%. The steel maker reported 5% drop in crude steel production to 3.97 million tonnes (MnT) in Q4 March 2020 as against 4.17 million tonnes (MnT) in Q4 March 2019. The production of flat rolled products declined 5% to 2.87 million tonnes (MnT) in Q4 March 2020 as against 3.01 million tonnes (MnT) in Q4 March 2019.

Mahindra & Mahindra jumped 14.44%. M&M said that its board took a decision that M&M will not be able to inject any fresh equity into SsangYong Motor Company (SYMC) and has urged SYMC to find alternate sources of funding. However, with a view to enable SYMC to have continuity of business operations, whilst they are exploring alternate sources of funding, the board has authorised the M&M management to consider a special one-time infusion of upto 40 billion KRW (South Korean won) , or $32 million, over the next three months.

PNB Housing Finance rose 4.15%. The housing finance company has signed an agreement with Japan International Cooperation Agency (JICA), one of the largest bilateral development organisations in the world, to raise $75 million with co-financing of $25 million by Citibank(Citi) for the purpose of providing affordable housing to low income households in India based on the facility for accelerating financial inclusion in Asia.

Sobha were locked in an upper circuit of 10% at Rs 176.20. The real estate firm on Friday (3 April) said total new sales volume decreased by 19.8% to 9.06 lakh square feet in Q4 March 2020 over Q4 March 2019. Sales volume inched up 1% to 40,71,704 square feet in the year ended March 2020 compared with 40,29,779 square feet in the year ended March 2019. The company's average price realisation rose by 12.58% to Rs 7,668 per square feet in Q4 March 2020 from Rs 6,811 per square feet recorded in Q3 FY20. Average price realisation, however, declined 5.94% during the quarter compared with Rs 8,152 in Q4 March 2019.

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