Key indices were trading with modest gains in early afternoon trade. At 12:21 IST, the barometer index, the S&P BSE Sensex, was up 126.08 points or 0.32% at 39,854.49. The Nifty 50 index added 37.65 points or 0.32% at 11,718. Valuing buying emerged after a steep correction on Thursday.

In the broader market, the S&P BSE Mid-Cap index rose 0.67% while the S&P BSE Small-Cap index added 0.36%.

The market breadth was positive. On the BSE, 1204 shares rose and 1138 shares fell. A total of 148 shares were unchanged.

Derivatives:

The NSE's India VIX, a gauge of market's expectation of volatility over the near term, shed 0.06% to 22.0425. The Nifty October 2020 futures were trading at 11,728, at a premium of 10 points compared with the spot at 11,718.

The Nifty option chain for 22 October 2020 expiry showed maximum call open interest (OI) of 32.42 lakh contracts at the 12,000 strike price. Maximum put OI of 21.65 lakh contracts was seen at 11,700 strike price.

The Nifty option chain for 29 October 2020 expiry showed maximum Call OI of 24.31 lakh contracts at the 12,500 strike price. Maximum Put OI of 33.88 lakh contracts was seen at 10,500 strike price.

Buzzing Index:

The Nifty Auto index rose 0.79% to 7,998.25. The index had slipped 3.03% in the past five sessions.

Ashok Leyland (up 4.01%), Bharat Forge (up 2.01%), Hero MotoCorp (up 1.78%), Bajaj Auto (up 1.42%), TVS Motor Company (up 0.96%), Eicher Motors (up 0.95%), Tata Motors (up 0.63%), Maruti Suzuki (up 0.51%) advanced while Mahindra & Mahindra shed 1.39%.

According to data released by the Society of Indian Automobile Manufacturers (SIAM), the passenger vehicle sales across the country climbed 26.45% year-on-year to 272,027 units during September 2020 from 215,124 units sold in September 2019. However, exports of passenger vehicles in September were down 35.89% YoY at 39,146 units.

Domestic two-wheeler sales in the previous month stood at 1,849,546 units, up 11.64% from 1,656,658 units reported in the same period last year. Two-wheeler exports also increased by 9.17% YoY to 331,233 units in September.

Stocks in Spotlight:

Alembic Pharmaceuticals shed 0.07% to Rs 948. The company said that it had received approval from the US Food & Drug Administration (USFDA) for its abbreviated new drug application (ANDA) amantadine hydrochloride tablets, 100 mg. The tablets are indicated for the prophylaxis and treatment of signs and symptoms of infection caused by various strains of influenza A virus. The drug is also indicated in the treatment of parkinsonism and drug-induced extrapyramidal reactions. Amantadine hydrochloride tablets, 100 mg have an estimated market size of $13 million for twelve months ending June 2020 according to IQVIA.

Cadila Healthcare gained 3.79% to Rs 431.35. The company has received final approval from the US Food and Drug Administration (USFDA) to market fingolimod capsules, 0.5mg. Fingolimod is an immunomodulating drug, indicated for the treatment of relapsing forms of multiple sclerosis (MS). The drug will be manufactured at the group's formulation manufacturing facility at the SEZ, Ahmedabad.

Cadila has also received the final approval from the USFDA to market verapamil hydrochloride injection USP, 5 mg/2 mL (2.5 mg/mL) and 10 mg/4 mL (2.5 mg/mL), single-dose vials. Verapamil injection is used to rapidly or temporarily restore normal heartbeats in people with certain heart rhythm disorders. The injections will be manufactured at the company's manufacturing facility at Jarod, near Vadodara (formerly known as Liva Pharmaceuticals).