The benchmarks indices ended with strong gains on Monday, led by the rally in bank stocks. The barometer index, the S&P BSE Sensex, jumped 448.62 points or 1.12% to 40,431.60. The Nifty 50 index added 110.60 points or 0.94% to 11,873.05.

Global stocks advanced amid hopes of fresh stimulus package in the US before the presidential election and expectation of coronavirus vaccine by the end of the year.

In the broader market, the BSE Mid-Cap index rose 0.58% and the BSE Small-Cap index gained 0.43%. Both these indices underperformed the Sensex.

The market breadth was positive. On the BSE, 1490 shares rose and 1170 shares fell. A total of 157 shares were unchanged.

Economy:

India's foreign exchange reserves jumped by $5.86 billion in the week ended October 9 to hit a fresh high of $551.5 billion. As COVID-19 pandemic led to a sharp decline in imports of crude oil and gold and Indian companies attracted huge foreign direct investments, the forex reserves swelled by $75 billion since lockdown announcement in last week of March.

Meanwhile, finance minister Nirmala Sitharaman today said that capital expenditure (CAPEX) by Central Public Sector Enterprises (CPSEs) is a critical driver of economic growth and need to be scaled up for the financial years 2020-21 and 2021-22. FM reviewed the capital expenditure of CPSEs in this financial year. The CAPEX target for 2020-21 is Rs 1,15,934 crore.

While reviewing the performance of CPSEs, the finance minister asked the concerned secretaries to closely monitor the performance of CPSEs in order to ensure the capital expenditure to the tune of 75% of the capital outlay by the end of third quarter of financial year 2020-21 and make appropriate plan for it. Sitharaman expounded that more co-ordinated efforts are required at the levels of secretary of concerned ministries and CMDs of CPSEs to achieve CAPEX targets.

While mentioning the significant role of CPSEs in giving a push to the growth of the Indian economy, the finance minister encouraged the CPSEs to perform better to achieve their targets and to ensure that the capital outlay for FY 2020-21 is spent properly and within time.

Numbers to Watch:

The yield on 10-year benchmark federal paper rose to 5.940% as compared with 5.935% at close in the previous trading session.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 73.37, compared with its close of 73.35 during the previous trading session.

In the commodities market, Brent crude for December 2020 settlement fell 28 cents at $42.65 a barrel. The contract fell 23 cents, or 0.53% to settle at $42.93 a barrel in the previous trading session.

Foreign Markets:

The US Dow Jones futures were up 199 points, indicating a strong opening for the US stocks today.

European shares were mixed while Asian stocks ended higher on Monday. China's economy recovered further from the coronavirus in the third quarter, according to data released Monday by the National Bureau of Statistics. China's GDP rose by 4.9% YoY in the third-quarter. That brings growth for the first three quarters of the year to 0.7% from a year ago. Slower recovery in Chinese consumption remained a drag, while uncertainty persisted about the ability of other countries to control the coronavirus pandemic and return to economic growth.

US stocks rose on Friday as further clarity regarding the timeline for the development of a coronavirus vaccine and much better-than-expected retail sales data and brought buyers back to the market. However, market gains were capped amid lingering uncertainty about a new stimulus bill.

Retail sales rose strongly in September, the fifth consecutive month of growth, as Americans spent more on clothing, cars and sporting goods. The US Commerce Department said Friday that retail sales jumped 1.9% last month. That's up from an increase of 0.6% in August.

US industrial production fell 0.6% in September. The Federal Reserve reported Friday that industrial production suffered its first decline since a 12.7% drop in April during the spring lockdowns.

The University of Michigan released a report showing a bigger than expected improvement in consumer sentiment in the month of October. The preliminary report said the consumer sentiment index rose to 81.2 in October from the final September reading of 80.4.

Meanwhile, US House Speaker Nancy Pelosi reportedly said on Sunday she was optimistic legislation on a wide-ranging coronavirus relief package could be pushed through before the election.

Pfizer shares jumped after Pfizer (PFE) Chairman and CEO Albert Bourla said the drug giant will apply for emergency use of the Covid-19 vaccine it is developing with BioNTech (BNTX) soon after the safety milestone is achieved in the third week of November.

Buzzing Indian Index:

The Nifty Bank index rose 3.12% to 24,266.75. The index has climbed 5.18% in two sessions.

Bank of Baroda (up 8.05%), Federal Bank (up 7.66%), ICICI Bank (up 5.33%), Axis Bank (up 4.43%), State Bank of India (up 4.21%), RBL Bank (up 4.01%), IDFC First Bank (up 3.59%), Bandhan Bank (up 3.44%), Kotak Mahindra Bank (up 3.01%) and Punjab National Bank (up 2.01%) advanced.

HDFC Bank added 0.36%. The bank's net profit increased 18.4% to Rs 7513.11 crore on a 6.9% rise in total income to Rs 36,069 crore in Q2 September 2020 over Q2 September 2019.

The board of HDFC Bank at its meeting held on 17 October 2020 has approved the appointment of Sashidhar Jagdishan as an additional director and as the managing director and chief executive officer of the bank, subject to the approval of the shareholders of the bank, for a period of three years from 27 October 2020, as approved by the Reserve Bank of India vide its email dated 03 August 2020.

CSB Bank rose 1.73%. The private lender's standalone net profit surged 178.60% to Rs 68.90 crore on 31.66% jump in total income to Rs 567.55 crore in Q2 September 2020 over Q2 September 2019. The bank's provisions and contingencies jumped 228.53% to Rs 80.72 crore in Q2 September 2020 over Q2 September 2019. Provision coverage ratio improves to 84.24% as on 30 September 2020 from 81.7% as on 30 June 2020 and 80.0% as on 31 March 2020.

IndusInd Bank rose 3.09%. The bank said that the Reserve Bank of India (RBI) had imposed a monetary penalty of Rs 4.5 crore on the bank for non-compliance with certain directions issued by the country's central bank.

Earnings Update:

ACC rose 0.09%. The cement major's consolidated net profit rose 20.26% to Rs 363.85 crore on 0.26% increase in net sales to Rs 3537.31 crore in Q3 September 2020 over Q3 September 2019. Operating EBITDA increased 20.47% to Rs 671 crore in Q3 September 2020 over Q3 September 2019. Operating EBITDA margin rose by 328 basis points to 19.4% in Q3 September 2020 compared with 16.1% in Q3 September 2019, supported by efficiency and cost reduction.

Hatsun Agro Product rose 0.75% after the company's standalone net profit jumped 160.66% to Rs 65.79 crore on 3.79% rise in revenue from operations to Rs 1,327 crore in Q2 September 2020 over Q2 September 2019.

Meanwhile, the board of Hatsun Agro Product recommended issuing one bonus shares for every three existing equity shares of Re 1 each fully paid up held by the shareholders on the record date i.e., 3 December 2020. The board also approved the proposal for raising of funds through private placement of equity shares by way of qualified institutional placement.

IIFL Securities surged 10.07% after consolidated net profit jumped 104.9% to Rs 50.92 crore on 18% increase in total income to Rs 218.22 crore in Q2 September 2020 over Q2 September 2019. Consolidated profit before tax (PBT) soared 42.6% to Rs 69.32 crore in Q2 September 2020 as against Rs 48.60 crore in Q2 September 2019. Tax expense for the quarter spurted 127.4% at Rs 19.31 crore as against Rs 8.49 crore in Q2 September 2019. The Q2 result was declared after market hours on Friday, 16 October 2020.

Bajaj Consumer Care gained 3.04% after the FMCG company posted a 1.6% rise in consolidated net profit to Rs 56.92 crore on a 4.3% rise in net sales to Rs 223.37 crore in Q2 September 2020 over Q2 September 2019. Profit before tax (PBT) stood at Rs 69 crore in Q2 September 2020 (Q2 FY21), increasing 7.1% from Rs 64.44 crore in Q2 September 2019 (Q2 FY20). Current tax expense rose 43.60% to Rs 12.12 crore in Q2 FY21 over Q2 FY20.

Stocks in Spotlight:

Cosmo Films spurted 7.57% to Rs 459.65 after the company said its board will consider a share buyback on Monday, 26 October 2020.

Jet Airways (India) hit an upper circuit of 5% at Rs 42.15. The airline's committee of creditors has approved the resolution plan submitted by Murari Lal Jalan and Florian Fritsch. As per reports, the Kalrock Capital-Murari Lal Jalan consortium has proposed to re-launch Jet Airways as a full-service carrier, with an initial investment of Rs 1,000 crore. It has initiated discussions with lessors and international airlines for contracts and partnerships.

JK Cement rose 2.47%. The company has successfully implemented additional capacity of 3 lakh tonnes per annum of white cement based wall putty at J K White, a unit of the company in Madhya Pradesh. The unit also commenced commercial dispatches on 19 October 2020. Therefore, the installed capacity at J K White, Katni stands at 7 lakh tonnes per annum. With this, the company has achieved white cement based wall putty manufacturing capacity of 12 lakh tonnes per annum.