Daily Markets View - Oct 6, 2020 - Mr. Deepak Jasani, Head of Retail Research, HDFC Securities

Indian equity benchmark indices ended higher for the fourth straight day on Oct 06 aided by positive global sentiments and reports that new Covid cases in India are falling. At close the Nifty was up 159 points or 1.38% at 11662.40, ending at its highest close since Feb 2020.

Volumes on the NSE were just under the recent average with Financials, Auto, Realty and Media sectors being the key gainers, while Metals index ended lower. Broader markets underperformed.

The India Services Business Activity Index, compiled by IHS Markit, stood at 49.8 in September compared with 41.8 in August. It rose for the 5th straight month. With manufacturing activity also improving, the Composite PMI Output Index rose to 54.6 in September from 46 in August.

World stock markets neared a more than two-week high on Tuesday after U.S. President Donald Trump's return to the White House from hospital where he was treated for COVID-19, and expectations of a new U.S. stimulus package being agreed rose. European stocks eased from a two-week high on Tuesday as a slide in technology and healthcare stocks along with mixed corporate updates tempered optimism about a U.S. stimulus package.

European stocks also reacted to a report from one leading bank which said the region was vulnerable to a stalling economy as COVID-19 cases remained elevated.

Traders bid up the prices of frontline stocks that reported good monthly data including financials and Auto stocks. Now the next resistance for the Nifty is at 11782. While global cues will impact Indian stock market trajectory temporarily, unless the trigger is very large, impacting the risk on sentiments, we do not see a large correction till the current results season is out.

Source : Equity Bulls

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