Sensex snaps 2-day losses, Nifty ends above 8750; pharma shines

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16 February 2017

3:30 pm Market Closing: Benchmark indices snapped two-day losing streak on Thursday, driven by healthcare, technology and auto stocks.

The 30-share BSE Sensex was up 145.71 points at 28301.27 and the 50-share NSE Nifty rose 53.30 points to 8778. About 1814 shares advanced against 992 declining shares on the BSE.

Sun Pharma, Infosys, Maruti Suzuki, Tata Steel, GAIL, Aurobindo Pharma and Tata Motors (DVR) gained 2-4 percent while ITC, L&T, ICICI Bank, Asian Paints, Coal India, Bharti Infratel, Bosch and BPCL were under pressure.

3:20 pm Buzzing: Bharat Forge shares hit a fresh 52-week high of Rs 1,072.80, up 5.35 percent intraday after signing agreement for joint venture company with Israel Aerospace Industries.

"Kalyani Strategic Systems (KSSL), the defence arm of Kalyani Group and Israel Aerospace Industries (IAI) signed a memorandum of understanding to incorporate a joint venture company in India, at the Aero-India exhibition in Bangalore," the auto ancillary and defence company in its filing.

As part of the MOU, IAI and KSSL are aiming to expand their presence in Indian defence market and to build, market and manufacture specific air defence systems and ground to ground & ground to sea munitions.

3:05 pm Defence deal: Reliance Aerostructure (RAL)'s Joint Venture with Rafale fighter jet manufacturer Dassault Aviation Dassault Reliance Aerospace Limited (DRAL) has been incorporated.

Eric Trappier, Chairman of Dassault Aviation France, will be the Chairman, and Anil D Ambani, Chairman of Reliance Group, Co-Chairman of DRAL, it was announced at the ongoing Aero India 2017 air show at Yelahanka airbase here.

Reliance Infrastructure Limited (RInfra)-promoted RAL will have 51 percent shareholding in the JV and Dassault Aviation (DA) will hold 49 percent, the company said in a statement.

In September 2016, India and France signed a purchase agreement for supply of 36 Rafale fighter jets at a value of 7.87 billion, or about Rs 60,000 crore.

2:48 pm Market Update: Benchmark indices extended gains in last hour of trade, with the Sensex up 153.23 points at 28308.79 and the Nifty rising 51.20 points to 8775.90.

About 1769 shares advanced against 955 declining shares on the BSE.

2:40 pm USFDA inspection: Cadila Healthcare shares rallied 17 percent after the US health regulator completed inspection of Moraiya facility with no observation.

"The US Food & Drug Administration inspected company's Moraiya facility from February 6, 2017 to February 15, 2017," the company said.

At the end of the inspection, no observation (483) is issued, it added.

2:26 pm StanChart on GDP: Indian growth story does not look rosy if we have to go by the estimates of analysts at Standard Chartered.

In conversation with CNBC-TV18, Anubhuti Sahay, Head-Economic Research pegs gross domestic product (GDP) at 7.2 percent for financial year 2018 versus 6.8 percent in 2017. This is while a majority of economists expect FY18 growth to be 7.5 percent or higher.

Sahay pointed out three concerns that she believes will slow growth; the effects of remonetisation lingering on in the initial part of the second quarter, global data suggesting Goods and services tax (GST) has proved detrimental to growth in the first year of implementation, and uncertainty on recovery in the investments cycle.

GST is likely to be rolled out in India on July 1.

2:00 pm Market Check
Benchmark indices maintained positive momentum in afternoon trade, with the Nifty holding 8750 level despite weakness in European stocks.

The 30-share BSE Sensex was up 130.77 points at 28286.33 and the 50-share NSE Nifty rose 42.15 points to 8766.85. The BSE Midcap index gained 0.7 percent and Smallcap jumped over a percent.

Market breadth remained in favour of advances. About two shares advanced for every share falling on the BSE.

SBI, TCS and Infosys were most active shares on bourses.

Bharat Forge, ABB India, MRPL, Indian Bank and Cadila Healthcare were biggest midcap gainer, up 3-4 percent while PNB Gilts, Indiabulls Ventures, ISGEC Heavy, SRS Real Infra and Rai Saheb Mills were top smallcap gainers, up 8-13 percent.

Markets in Europe were lower following record closes on Wall Street. France's CAC, Germany's DAX and Britain's FTSE were down 0.3 percent each.

1:25 pm Interview: The decision of the OPEC countries to cut output in an effort to reduce global glut has created ripples in the oil market. But, HPCL's Chief, MK Surana believes oil prices will not rise substantially.

"There is a surplus overhang of petrol and diesel in the world market as far as the inventories are concerned. We believe crude prices will not substantially go higher,'' said Surana in an interview to CNBC-TV18.

He pointed out the production in US has increased and there are additions from Libya and Nigeria.

There is surplus inventory which hasn't been soaked up completely and Surana says the market is still oversupplied. "We believe that the crude prices will continue to hover between in USD 55-60 per barrel in near future."

1:00 pm Market Check
Equity benchmarks as well as broader markets continued to hold positive momentum in afternoon trade, led by technology and auto stocks. FMCG and infra stocks were under pressure.

The 30-share BSE Sensex gained 97.39 points at 28252.95 and the 50-share NSE Nifty rose 34.40 points to 8759.10. About 1616 shares advanced against 978 declining shares on the BSE.

TCS shares gained 1.4 percent as the company will consider share buyback on February 20. Infosys rose 2.7 percent as hopes increased that the company would follow suit.

Tata Sons' N Chandrasekaran says 2017 looks set to be a good year for the company, with strong demand keeping margins healthy.

The mega merger of SBI and its 5 subsidiaries received the cabinet nod. SBI says the merger process should be nearly completed in a month from the date of notification. The stocks gained 0.6 percent but off early highs.

Oil held steady today, supported by ongoing supply cuts led by producer group OPEC, while rising fuel inventories and crude production in the United States dragged on prices. Brent crude futures were trading at USD 55.69 per barrel, down just 0.11 percent from their last close.

Gold prices rose as the dollar drifted down from one-month highs hit in the previous session on upbeat US economic data.

12:50 pm Vedanta expansion: Keen to get a strong foothold in Jharkhand, mining baron Anil Agarwal today said he has "big plans" for the state but initial foray will be with USD 1 billion investment that includes setting up a 1 million tonne steel plant.

Dubbing Jharkhand as "a diamond in the crown of the world", Vedanta Resources Group Chairman Anil Agarwal said the state is "full of potential" and Vedanta has big plans for it.

"There is a lot of potential...This (Jharkhand) is a real Australia in India with its huge natural resources. We have a big plan but we will start with the medium size or small size project...We intend to set up a one million tonne of steel plant," Agarwal told PTI in an interview.

12:31 pm Buzzing: Shares of IL&FS Engineering advanced 7.5 percent intraday on winning of two contracts worth Rs 123.05 crore.

The company has received fax of acceptance (FOA) from GAIL for two pipeline laying contracts worth Rs 123.05 crore in Kerala/Karnataka.

It also received a contract worth Rs 83.76 crore for laying and construction of pipeline along with associated works in Kerala.

Another contract is for laying and construction of pipeline along with associated works in Karnataka. The total value of this contract is Rs 39.29 crore.

Both the contracts are to be mechanically completed in 11 months from date of FOA and with additional 1 month for commissioning and Gas-in.

12:00 pm Market Check
The market gained strength again in noon trade, with the Nifty climbing back above 8750 level, driven by index heavyweights Infosys and Reliance Industries.

The 30-share BSE Sensex rose 115.72 points to 28271.28 and the 50-share NSE Nifty gained 43.10 points at 8767.80.

The broader markets extended gains, with the BSE Midcap index rising nearly a percent on strong breadth. About two shares gained for every share falling on the exchange.

Infosys continued to be leading contributor to Sensex's gains, up more than 2 percent on hopes that the management might consider share buyback. Hopes raised after its peer TCS announced that its board of directors will consider share buyback on February 28. The stock was up 1.4 percent.

Sun Pharma was biggest gainer among Sensex stocks, up 3 percent after a media report indicated that the company is planning to shift production of key products from its Halol, Gujarat factory to other plants.

State Bank of India, State Bank of Bikaner and Jaipur, State Bank of Mysore and State Bank of Travancore retained their upside in noon, up 1-4 percent after Cabinet has approved merger plan.

Auto stocks rebounded after recent selling pressure. Tata Motors gained 1.4 percent and Maruti Suzuki rose 1.9 percent on short covering.

11:51 am Jio subscriber base: Reliance Industries chairman Mukesh Ambani said his telecom venture Jio has crossed a customer base of 100 million.

"When we started Jio, we set a target for ourselves that we will acquire 100 million customers in shortest time. Even we didn't imagine that we would do it in months," Ambani said at the three-day Nasscom leadership forum here.

The company has been providing free 4G service since its soft launch on December 27, 2015 for RIL employees only and later opened it for all customers on September 5, 2016 thus completing over 160 days of its commercial operations.

"We just set ourselves a goal. Aadhaar enabled us to acquire a million customer a day which is unheard of in the industry as a whole," Ambani said.

Disclosure: Reliance Industries, the parent company of Reliance Jio, owns Network 18 that publishes Moneycontrol.com.
 
11:27 am Buzzing: IT firm Cyient shares gained 2 percent intraday after its subsidiary signed a joint go-to-market agreement with Italian company during Aero India seminar.

"Italian company ASE S.p.A and Cyient Inc, on February 15, announced a joint go-to-market agreement for joine market development of products in electric power generation arena," the company said in its filing.

This collaboration will provide full life-cycle services, products and systems to aerospace and defence industry.

11:00 am Market Check
Benchmark indices continued to consolidate in morning as investors digested quarterly corporate earnings. Now all eyes on assembly elections of five states and GST Council meet later in the week.

The 30-share BSE Sensex was up 29.02 points at 28184.58 and the 50-share BSE Nifty gained 14.25 points at 8738.95 while the broader markets outperformed benchmarks.

The BSE Midcap and Smallcap indices gained half a percent each on positive breadth. About 1376 shares advanced against 877 declining shares on the BSE.

Infosys was the top contributor to Sensex's gains, up 1.5 percent on hopes of share buyback from the company. TCS today morning announced that it will consider share buyback on February 20.

Sun Pharma was the biggest gainer among Sensex stocks, up 2.7 percent. The company has received tentative approval from the US Food & Drug Administration for Tadalafil tablets that are used to treat erectile dysfunction & arterial hypertension.

Tata Motors shares rebounded 1.8 percent on short covering. The stock fell nearly 14 percent in last two sessions after disappointing set of earnings.

State Bank of India, State Bank of Bikaner and Jaipur, State Bank of Mysore and State Bank of Travancore rallied 1-5 percent after Cabinet approved merger.

However, the sell-off in ITC (down 1.7 percent), ICICI Bank (down 1.9 percent) and HDFC (down 0.5 percent) shares restricted market's upside.

Benchmark indices entered into consolidation phase after opening rally as investors closely watch GST Council meet on February 18 and assembly elections in five states that will end on March 8.

The 30-share BSE Sensex gained 30.88 points at 28186.44 and the 50-share NSE Nifty rose 7.05 points to 8731.75.

Market has digested most of the news post demonetisation emerging relatively unscathed and S Krishna Kumar of Sundaram Mutual Fund feels every dip can now be invested in.

On the outperformance in midcaps and smallcap space, he says, it is better to tread with caution and pick specific quality stocks than watching the broad market index.

SBI was up 1.4 percent after the merger of five associate banks received Cabinet approval. State Bank of Bikaner and Jaipur, State Bank of Mysore and State Bank of Travancore rallied 4-5 percent.

TCS gained 1.7 percent as it says the board of directors will consider buyback of shares on February 20.

Dr Reddy's Laboratories shares fell 2 percent after it got an unfavourable ruling in a US court regarding a patent infringement case over anti-nausea injection Aloxi.

ICICI Bank, ITC, L&T, Adani Ports, Asian Paints and Hero Motocorp were down 1-2 percent while Infosys, Sun Pharma and Maruti gained 1-2 percent.

9:48 am FII View: Sean Darby of Jefferies says global equities are in a sweet spot with rising asset turnover and pricing power helping shares of the real economy while higher bond yields and firming input costs will weigh heavily on the bond proxies in 2017.

As the China data demonstrates, it is better to be upstream rather than downstream, it feels.

Value and earnings revisions styles still seem appealing. Turned modestly bearish on India since December 2016, Darby says.

9:25 am Oil Auction: State-owned refiners BPCL, HPCL and IOC alongside a company floated by directors of drugmaker Sun Pharma were declared as winners of the much-hyped small oil and gas field discovery auction.

The Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, approved award of 31 fields out of the 34 that had received bids.

Bharat PetroResources Ltd, a unit of Bharat Petroleum Corporation Ltd (BPCL), won as many as four of the fields while Hindustan Petroleum Corporation Ltd's subsidiary Prize Petroleum and Indian Oil Corporation (IOC) walked away with three each.

Sun Petrochemicals Pvt, a privately-owned company formed by the directors of Sun Pharmaceuticals Industries Ltd, won the B-37 Cluster in Mumbai offshore, for which it was the sole bidder. It had bid for 6 out of the 46 fields that were auctioned last year.

9:15 am Market Check: Equity benchmarks rebounded in opening on Thursday after two-day losses, supported by PSU banks and technology stocks.

The 30-share BSE Sensex was up 48.32 points at 28203.88 and the 50-share NSE Nifty rose 14.25 points to 8738.95.
 
SBI gained 2 percent after cabinet approved merger of five associate banks with the bank. State Bank of Bikaner and Jaipur, State Bank of Mysore and State Bank of Travancore rallied 6 percent each.

TCS rose 1.71 percent as the board of directors will consider buyback of shares on February 20.

Infosys, Cipla, Tata Motors and Sun Pharma were other gainers while ITC, Bharti Airtel, Aurobindo Pharma, Bharti Infratel, Coal India, ICICI Bank and HDFC Bank were under pressure.

The Indian rupee has opened lower by 4 paise at 66.94 per dollar against previous close of 66.90.

Mohan Shenoi of Kotak Mahindra Bank says dollar rally looks to have lost steam despite Federal Reserve chair Janet Yellen's hawkish testimony and uncertainty regarding Trump's economic & foreign policy.

Rupee has been resilient on the back of change in monetary policy stance of RBI, he feels. He expects USD-INR to trade in the range of 66.70-67 for the day.

The dollar retreated from 1-month high as investors took profits after US data showed robust growth in retail sales and consumer prices in January.

Asia markets traded mixed today, despite US gains as stocks closed at fresh highs for a fifth-straight day despite US overnight gains with Toshiba shares down anew.

Wall Street pushed further into record-high territory on Wednesday, with the S&P 500 notching a seven-session winning streak, helped by a round of robust economic data and ongoing optimism that President Donald Trump will cut corporate taxes.





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