Daily Markets - April 5, 2021 - Mr. Deepak Jasani, Head of Retail Research, HDFC Securities

Indian benchmark equity indices began the new trading week on April 05 on a negative note, as rising coronavirus cases kept a check on investor sentiment. Nifty opened gap down, kept falling and made an intra day low at 1110 Hrs. a recovery from there resulted in losses being cut. At close, the Nifty 50 index ended 1.5% or 230 points lower at 14,637.

Volumes on the NSE were in line with recent averages as Nifty fell with volumes. Among sectors, Banks, Financials, Realty, Media, Auto, FMCG indices fell the most while Metals and IT ended in the positive. Broader markets also ended with losses, majorly in-line with the benchmark indices.

India's manufacturing activity hit a speed bump in March after being on the slow road to improvement over the previous few months due to the renewed escalation of the (COVID-19) pandemic and subsequent restrictions played spoilsports for factory activity. As per the IHS Markit India Manufacturing Purchasing Managers' Index (PMI) survey, manufacturing PMI stood at a seven-month low of 55.4 in March, down from 57.5 in February.

Asian stock markets were mostly higher on Monday amid thin holiday trade across the region, following positive cues from US markets on Thursday on upbeat jobs and manufacturing data and stimulus-fuelled global economic recovery post $2 trillion infrastructure and economic recovery plan announced by the US President. European markets were largely shut on account of Easter holidays.

On April 05, Nifty filled the upgap made on March 30 in the morning weakness. Severely adverse advance decline ratio suggests broad nervousness in the markets. RBI's credit policy and Q4 earnings numbers create some added uncertainty for traders when Covid cases are on the rise. Indian markets have underperformed severely. Nifty could remain in 14471-14814 band for the next few days with downward bias.

Source : Equity Bulls

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