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

Indian benchmark equity indices managed to end with small gains on Feb 05, ending higher for the fifth straight session after hitting record highs in early trade. The outcome of the RBI's MPC had little effect on the markets. At close the Nifty ended 28.6 points or 0.2% higher at 14,924. For the week, Nifty closed up 9.5% - its best weekly advance since April last year.

Volumes on the NSE remained high as participation remained high from institutional players. Among sectoral indices, PSU Bank, Nifty Bank were the main gainers while Media, Auto and IT were the main losers. The Nifty Midcap index fell 1.1% while the smallcap index closed 0.3% higher.

As expected, the RBI's MPC voted unanimously to leave the policy repo rate unchanged at 4% - for the fourth consecutive time. The accommodative stance of the monetary policy is likely to continue till the end of FY22 and would be supportive for growth complementing the budgetary measures announced ensuring revival in growth on a durable basis.

Global shares came near record highs on Friday and the dollar headed for its best weekly gain in three months, as progress in vaccine distribution and U.S. stimulus hopes prompted bets on further normalisation in the global economy.

Germany's 30-year government bond yield climbed back into positive territory for the first time since September.

Nifty gained handsomely in the week gone by aided by the announcements in the Union Budget. It has turned back from 15,000 after breaching it during the day. However it may make another attempt to touch/breach that number in the coming week. Advance decline ratio again ended in the negative reflecting some profit taking in midcaps (as the attention has shifted to largecaps lately). Even as markets keep rising, portfolio and asset allocation review may help protect gains and/or release funds for deployment in happening stocks.

Source : Equity Bulls

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