Sensex ends in red, Nifty holds 8150; IT, realty fall most
09 September 2014
03:30 Market closing
The market has ended in red after hitting record high yesterday. The Nifty managed to hold on to 8150 and ended at 8151.80, down 22.10 points. The Sensex was down 52.96 points at 27266.89.
IT and realty stocks led the fall with major laggards as Tech Mahindra, HCL Tech and DLF on the Nifty. Cipla, Coal India, ITC, IndusInd Bank and Tata Motors were top gainers.
Nalin Gupta, executive director of civil engineering and infra development company J Kumar Infra said the Rs 137 crore funds raised from QIP would be mainly used for capital expenditure and working capital requirements and would not be used for paring debt.
The debt for the company currently stands at around Rs 500 crore.
According to him, Rs 70 crore capex would be sufficient for the next two-three years.
With the infrastructure sector slated to get a boost from the new government, Gupta is upbeat for the company's future prospects. The company has bid for development of Mumbai Metro. The pre-qualification have been submitted and the procedures are in advance stages now, said Gupta. The project could be around Rs 20,000-25,000 crore.
The company had also bagged reasonable amount of the Rs 3000 crore tenders floated by Bombay Muncipal Corporation (BMC) last December. Moreover, they also aim to bag substantial orders from the Rs 2000 crore tenders floated in September now, he added.
J Kumar Infra stock rallied 84 percent this year.
02:45pm Dollar at 14-month high
A robust dollar swept to a 14-month high as investors tweaked bets on an early hike in US interest rates, burdening oil, gold and stocks in the energy majors.
As the dollar broke to a six-year peak on the yen and a 14-month top against the euro, gold sagged to a three-month trough and Brent oil settled below the $100 a barrel mark.
Giving the dollar bulls encouragement was research from San Francisco Fed economists that showed investors are pricing in a lower trajectory for interest rates rises than members of the Fed itself are.
The dollar index, which benchmarks the greenback against six other major currencies, was up 0.25 percent, having climbed to a 14-month high of 84.519. A break above 84.753 would take it to highs not seen since July 2010, reports Reuters.
02:30pm Brigade Enterprises on buyers' radar
Shares of Brigade Enterprises climbed 3 percent after Crisil Research assigned fundamental grade 4/5 to the stock. The grade indicates that the company's fundamentals are superior relative to other listed equity securities in India.
According to the report, the fair value of the stock is Rs 210 per share and at the current market price of Rs 131 per share, valuation grade is indicating that the market price has strong upside from the current levels.
Crisil Research said the assigned fundamental grade reflects Brigade's strong brand equity due to high quality construction, a track record of timely delivery of projects and the resultant established position in the Bengaluru real estate market, which is poised for robust growth.
02:15pm Market Expert
With investment sentiment turning positive in India, Quant Capital Institutional Equities maintains an 'overweight' rating on EM equities.
Furthermore, he sees incremental inflows in Indian equities if FII cap for debt breaches, as debt market stands only Rs 3,000 crore short of breaching the FII limit. Currently, debt inflows stand at USD 18.3 billion year-to-date.
However, Quant Capital's equity strategist Rishav Dev sees consistent inflows from ETFs.
Amongst the emerging markets, the Brazilian market has set in motion with significant inflows in the past 2-3 weeks. On the other hand, China witnessed the biggest outflow this week, he says in an interview with CNBC-TV18.
02:00pm Equity benchmarks fell about half a percent in afternoon trade but the broader markets outperformed with the BSE Midcap and Smallcap indices rising 0.44 percent and 0.2 percent, respectively.
The Sensex declined 110.98 points to 27208.87 and the Nifty slipped 37.30 points to 8136.60 weighed down by capital goods, oil & gas, technology and select banks stocks.
Top private sector lender ICICI Bank, two-wheeler maker Bajaj Auto and state-run oil and gas producer ONGC topped the selling list, falling 1.6 percent each followed by Infosys and Wipro with over a percent loss.
Shares of L&T, Reliance Industries, Sun Pharma, HDFC, Sesa Sterlite, Axis Bank and Hero Motocorp declined 0.3-0.8 percent. However, Tata Motors, ITC, Cipla, Bharti Airtel, Coal India, M&M, Dr Reddy's Labs, Tata Steel and Tata Power outperformed, up 0.4-1.5 percent.
In the midcap space, Schneider Electric rallied 20 percent followed by Info Edge, Punj Lloyd, Sadbhav Engineering and Va Tech Wabag with 7-9 percent while Sobha Developer, HT Media, Trinity Trade, Torrent Power and Hathway Cable lost 3-4 percent.
1:30 pm Market outlook: There is enough risk appetite among investors for small and mid cap shares even after the recent rally, feels Amit Rathi, Managing Director, Anand Rathi Securities. His brokerage is holding an investor conference for small and mid-cap companies. Speaking to CNBC-TV18 from the sidelines of the conference, Rathi said these stocks still had enough steam left. That is because while frontline indices like Nifty and Sensex are up 30 percent from their 2008 peaks, the mid-cap index is still flat and the small cap index is 25 percent below its previous peak. On second line pharma shares, Rathi says the companies would be able to sustain the strong growth in earnings seen in recent quarters. Domestic formulation business is what most investors are bullish on, he said.
Profit booking continues as the Nifty sinks below 8150. The 50-share index is down 32.10 points at 8141.80 and the Sensex is down 90.79 points at 27229.06. About 1462 shares have advanced, 1321 shares declined, and 87 shares are unchanged.
IT stocks are leading the fall with major losers as Infosys, Wipro, HCL Tech and Tech Mahindra. Other laggards in the Sensex are Bajaj Auto, Sesa Sterlite, ONGC and ICICI Bank.
However, small and midcap stocks are holding in green along with autos, pharma and FMCG stocks. Cipla, Coal India, Bharti Airtel, Tata Motors and Tata Power are lead gainers in the Sensex.
In a CNBC-TV18 exclusive, Environment Minister, Prakash Javadekar says that there is not even a single file pending for approval. He adds that the ministry plans faster due diligence and environmental nods for new coal mines to speed up the auction process post the supreme court decision on coal allocation.
01:00pm Ashok Leyland in News
Ashok Leyland has received orders for 4000 buses from state transport undertakings (STUs) on Monday.
"A total of 22 STUs including Calcutta State Transport Corporation, Bangalore Metropolitan Transport Corporation, AP State Transport Corporation and Pune Mahanagar Parivahan Mahamandal have placed orders to the company," said the flagship company of Hinduja group. The orders were worth Rs 1,500 crore.
Ashok Leyland will offer a mix of JanBus, midi-buses and Ultra Low Entry buses as a part of 4000 buses orderd under JNNURM-II. The company has started supplying these buses.
12:45pm Market Expert
Dhananjay Sinha, head of institutional research at Emkay Global Financial Services says people or investors are now starting to get nervous while investing in stocks that have already run up. He says it is important to look at volumes behind the rally in midcap names.
According to him, investors are now treading with caution and that is the first sign of nervousness creeping into the market. He advises investors to look at larger cap and midcap quality names with good liquidity.
12:30pm Apollo Tyres in News
Apollo Tyres hit a record high of Rs 217.70 per share as the tyre manufacture is setting up a new plant in Hungary at an investment of 442.2 million euros (about Rs 3,450 crore) and the investment aid given by the country's government has been cleared by European Commission. The stock has been on buyers' radar for some days as rubber prices have seen sharpest decline in five years.
According to the company, its project in Hungary involves investments of 442.2 million euros and is expected to create over 975 now jobs. It is to be carried out in Gyongyoshalasz, in Northern Hungary, the commission said in a statement.
There is strong demand from truck companies and this could improve in the coming months as economic recovery gathers pace, says Subba Rao Amarthaluru, group CFO, RPG Group.
In an interview to CNBC-TV18, he says overall sentiment in the sector is positive, thanks to weak rubber prices, and now easing crude prices.
Huge imports are keeping domestic rubber prices soft and lower cost of raw materials is helping boost CEAT's operating profit margins, Subba Rao says.
He sees rubber prices rising 8-10 percent over the next few months, but expects the company's operating expenses to remain stable. He sees current year revenues rising 8-10 percent, driven by strong growth in the December and March quarters, which are typically strong quarters for the company.
12:00pm The market continued to reel under marginal selling pressure due to profit booking after a percent rally in previous session. The Sensex lost 89.92 points to 27229.93 and the Nifty declined 31.65 points to 8142.25.
About 1362 shares have advanced, 1282 shares declined, and 87 shares are unchanged.
Ceat, Sun TV Network, Wockhardt, Apollo Tyres, SBI, Tata Motors and Ashok Leyland were most active shares on exchanges.
Shares of Infosys, ICICI Bank, L&T, Bajaj Auto, Wipro and Sesa Sterlite were prominent gainers in the Sensex whereas Cipla bucked the trend, up 2 percent after it announced a commercial collaboration with UK-based S&D Pharma to enter Czech Republic and Slovakia.
Top telecom operator Bharti Airtel rebounded, up 1 percent followed by ITC, Tata Motors, HDFC Bank, Dr Reddy's Labs, Coal India, Tata Power and M&M with 0.2-0.8 percent.
There is enough risk appetite among investors for small and mid cap shares even after the recent rally, feels Amit Rathi, Managing Director, Anand Rathi Securities.
Speaking to CNBC-TV18, Rathi said these stocks still had enough steam left. That is because while frontline indices like Nifty and Sensex are up 30 percent from their 2008 peaks, the mid-cap index is still flat and the small cap index is 25 percent below its previous peak.
11:45 am Buzzing: Shares of TCS hit record high at Rs 2667 per share, up over 1 percent intraday on management's confidence to retain its FY15 bullish outlook. In its analysts meet, the company has maintained that FY15 will be a better growth year than last fiscal with 1HFY15 growing faster than 2HFY15.
TCS has retained its medium-term margin target of 26-28 percent. The IT major also feels that Indian business to report growth in July to September quarter and Japan JV to contribute USD 100 million in Q2. Japan JV contribution is seen at lower end of guided range of USD 300-375 million.
However, the management feels there may be an impact of 80 basis points on dollar rev growth due to cross currency.
This has got analysts excited about the prospects of the Chandrasekaran-led company. Most brokerages recommend buying the stock. Credit Suisse maintains outperfom rating on the company stating that it is well placed to top the growth in FY15 among the top-6 Indian IT firms.
The bulls seem to be resting for another day. The Sensex is down 93.46 points at 27226.39, and the Nifty is down 32.40 points 8141.50. About 1210 shares have advanced, 1220 shares declined, and 79 shares are unchanged.
Infosys, ICICI Bank, Sesa Sterlite, ONGC and Hindalco are among the laggards while Bharti Airtel, Cipla, M&M, Tata Motors and Coal India are major gainers.
Metal stocks are falling ahead of the Supreme Court's hearing on "illegal" coal block allocations.
Brent crude eased for a fourth straight session but held above USD 100 a barrel after dropping below that level on the previous day for the first time in 16 months, with prices supported by hopes of production cuts by OPEC.
Brent was trading 14 cents lower at USD 100.06 per barrel after ending the previous session 62 cents down. It had earlier on Monday slumped to USD 99.36, the lowest since May 1, 2013, before rebounding into three-digit territory.
11:00am NSE F&O additions
Shares of Eicher Motors, Motherson Sumi Systems, Mindtree, SKS Microfinance and TVS Motor Company gained 0.5-3.5 percent on additions in NSE F&O segment.
"Based on the stock selection criteria as prescribed by SEBI circular and approval received from SEBI, the futures and options contracts on above five additional securities would be available for trading w.e.f. September 10, 2014," said the National Stock Exchange of India (NSE) in its filing.
Currently, 135 scrips trade in the NSE F&O segment.
10:30am Prestige Estates on buyers' radar
Shares of Prestige Estates Projects gained more than 2 percent on hopes of strong earnings per share growth going ahead. Bank of America Merrill Lynch (BoAML) sees room for upside in the stock triggered by further launches/pre-sales, execution/EPS growth, pick-up in commercial leasing and improvement in macro.
The brokerage feels it is a good time to buy the stock, which is currently trading at its average P/NAV of 0.7 compared to its recent high of 0.9 P/NAV.
It is one of the top picks, says BoAML, which expects earnings per share of the company to nearly double from Rs 9 in FY14 to Rs 17 in FY17E. According to the report, the company will beat its FY15 pre-sales target of Rs 5,000 crore.
Prestige's pre-sales in April-June quarter of current financial year 2014-15 stood at Rs 1,410 crore. Other two reasons that convinced BoAML to say buy the stock are unabated execution providing comfort towards collections (cash flows) and revenues (P&L); and aAnnuity income of Rs 4,200 crore in FY16 provides NAV stability.
10:00am Equity benchmarks remained under pressure with the Sensex falling 81.07 points to 27238.78 and the Nifty declining 27.45 points to 8146.45 weighed down by banks, capital goods and metals stocks.
Bharat Iyer, JPMorgan says comfortable global liquidity, lower global commodity prices and a historic electoral verdict have all been supportive for Indian equities this year so far.
However, elevated expectations are the main risk now as recent correction in some of the investment-linked sectors can be linked to that, he adds.
Hindalco Industries and Jindal Steel slipped around a percent ahead of Supreme Court hearing on coal block allocation case today afternoon.
Shares of Infosys, ICICI Bank, Larsen and Toubro, ONGC, HDFC, Reliance Industries, Sun Pharma, Axis Bank and Tata Steel lost 0.3-1 percent while Tata Motors, Bharti Airtel and Cipla bucked the trend, up 1-1.5 percent. ITC, Coal India, M&M and HUL gained marginally.
Advancing shares outnumbered declining ones by a ratio of 1154 to 988 on the Bombay Stock Exchange.
10:00 am FII view: Bharat Iyer, JPMorgan says comfortable global liquidity, lower global commodity prices and a historic electoral verdict have all been supportive for Indian equities this year so far.
However, elevated expectations are the main risk now as recent correction in some of the investment-linked sectors can be linked to that, he adds.
9:35 am Buzzing: Shares of Cipla jumped around 2 percent intraday on Tuesday after it announced a commercial collaboration with UK-based S&D Pharma to enter Czech Republic and Slovakia.
As per the agreement, Cipla will be driving its respiratory product portfolio in both Czech Republic and Slovakia through a Cipla owned sales force team, managed by Cipla commercial head. S&D Pharma will physically distribute all products, including respiratory products, and this portfolio will increase over the next few years.
The company said, in a press statement, that once regulatory and reimbursement approvals are in place, the Salmeterol-Fluticasone fixed combination will be launched in both markets underthe name Fullhale.
After hitting record high yesterday, the market has opened in red. The Sensex is down 23.79 points at 27296.06 and the Nifty is down 14.35 points at 8159.55. About 556 shares have advanced, 140 shares declined, and 35 shares are unchanged.
Infosys, Bharti, Tata Steel, Hindalco and Sesa Sterlite are top losers in the Sensex. Bharti, TCS, Coal India, Cipla and Tata Power are top gainers.
The Indian rupee opened on a weak note and has slipped by 14 paise to 60.43 per dollar as against previous day's closing value of 60.29 a dollar.
Ashutosh Raina of HDFC Bank said, "The US dollar posted strong gains across the board, with Euro, Yen and Pound hitting troughs and USD Index just short of it's high of 84.75 hit in July 2013. Strong FII flows and suspected Central Bank intervention have ensured that rupee consolidates in 60-61/dollar range."
The dollar traded at 14-month highs against a basket of major currencies, benefiting from a run in Sterling and after a Federal Reserve study sparked more buying interest. Giving bulls a boost, a research from the San Francisco Fed noted that investors are pricing in a lower trajectory for interest rate rises than members of the Fed itself.
In the US, stocks mostly declined, with energy producers leading losses on oil's drop to a multi-month low, as investors retreated after a fifth week of gains.
And in Europe, shares closed lower after weak trade data from China and concerns about the Scottish independence vote.