Sensex, Nifty end flat; HDFC Bank, Hero major laggards

07 Nov 2014

1

03:30 pm Market closing
The market has ended flat. The Sensex is down 47.25 points at 27868.63 and the Nifty is down 1.30 points at 8337.00.  About 1445 shares have advanced, 1562 shares declined, and 103 shares are unchanged.

Dr Reddy's Labs,  Axis Bank, Sun Pharma, HUL and ONGC were top gainers in the Sensex. Among the losers were BHEL, GAIL, Hero Moto, Sesa Sterlite and HDFC Bank.

03:10 pm Results
Public sector lender UCO Bank's second quarter net profit fell 74 percent year-on-year to Rs 103.5 crore dented by higher provisions and lower net interest income but was supported by higher other income. Profit was Rs 400.2 crore in the year-ago period.

Net interest income (NII - the difference between interest earned and interest expended) declined 11.9 percent to Rs 1,383 crore in the quarter ended September 2014 compared to Rs 1,570 crore in same quarter last year. However, other income (non-interest income) climbed 71.6 percent year-on-year to Rs 358.97 crore in the quarter gone by.

Provisions and contingencies jumped 23.3 percent Y-o-Y (up 80.9 percent sequentially) to Rs 935.3 crore in the second quarter of current financial year 2014-15.

Asset quality deteriorated sequentially. Gross non-performing assets (NPA) declined 12 basis points on yearly basis (up 89 bps quarter-on-quarter) to 5.20 percent while net NPA rose 2 bps year-on-year (up 82 bps quarter-on-quarter) to 3.15 percent during the quarter.

02:50pm Chambal Fertilisers hits 52-week high
Chambal Fertilisers and Chemicals beat street expectations on all parameter except textile business. Net profit in July-September quarter climbed 22 percent year-on-year to Rs 115 crore on strong operational performance. Profit in the year-ago period was Rs 94 crore.

Profit was expected at Rs 95 crore on revenue of Rs 2,400 crore for the quarter, according to the average of estimates of analysts polled by CNBC-TV18.

Net sales rose by 1 percent to Rs 2,507 crore in the quarter ended September 2014 compared to Rs 2,489 crore in same quarter last year.

Operating profit grew by 28 percent year-on-year to Rs 247 crore and margin expanded by 220 basis points to 10 percent during the quarter, which both were higher than analysts' estimates of Rs 203 crore and 8.5 percent, respectively.

The stock hit 52-week high of Rs 70 on the BSE, up by Rs 5 compared to Wednesday's close.

02:30pm Gold Update
Gold tumbled to a fresh 4-1/2 year low and looked set to post its third straight weekly drop on Friday, as the US dollar rallied on economic optimism and expectations the Federal Reserve could raise rates sooner rather than later.

A robust US nonfarm payrolls report later in the day could provide more evidence of a strengthening economy, influencing the Fed and possibly hurting gold, a non-interest-bearing asset.

After subdued trading early on, US gold futures slid 1 percent after nearly 4,000 lots were traded in just one minute at 0459 GMT (1159 ET). They fell to USD 1,130.40 an ounce - their lowest since March 2010.

Spot gold fell as much as 0.8 percent to USD 1,131.85 - lowest since April 2010 - before recovering modestly to USD 1,133.30 by 0622 GMT. The yellow metal has fallen over 3 percent so far this week, reports Reuters.

02:00pm Market Check
It is a quiet day of consolidation as the Nifty hovered in a 50-point range while the broader markets outperformed benchmarks with the BSE Midcap index rising 0.5 percent.

The 30-share BSE Sensex declined 45.61 points to 27870.27 and the 50-share NSE Nifty fell 2.45 points to 8335.85. About 1342 shares have advanced, 1509 shares declined, and 96 shares are unchanged on the BSE.
 
Vibhav Kapoor of IL&FS says this is still a market to buy on every dip. He expects to see the Nifty at 9000 by March 2015.

Dr Reddy's Labs surged nearly 5 percent as it received USFDA approval for Valcyte generic while DLF climbed 5.5 percent as the Securities Appellate Tribunal or SAT has allowed the realty major to redeem Rs 1,806 crore from mutual funds till next month.

The rupee weakened marginally today to 61.53 a dollar versus a close of 61.41 on Wednesday on account of dollar strength. The dollar index hit a fresh 52-week high of 88 spurred by dovish comments from the European Central Bank, falling oil prices and tepid data from UK.

On the global front, all eyes are on the October jobs report due for release later this evening, the US is likely to add 2,43,000 jobs in October.

1:50 pm Results: FMCG major Marico has reported a 11.7 percent growth in consolidated net profit at Rs 118.3 crore in July-September quarter led by higher revenue growth. Profit in the year-ago period was Rs 105.9 crore.

Consolidated total income from operations grew by 28 percent to Rs 1,431 crore in the quarter ended September 2014 compared to Rs 1,118.4 crore in same quarter last year with volume growth of 7 percent.

"Volume growth in India was 8 percent and 5 percent in International business," said the company in its filing.

1:30 pm Buzzing: Shares of Aurobindo Pharma hit record high at Rs 1043.40 per share, up 4 percent intraday on Friday after it has reported a whopping 58.3 percent growth in consolidated net profit at Rs 372 crore for July-September quarter led by US generics. Profit in the year-ago period was Rs 235 crore.

Consolidated revenue grew by 50.5 percent to Rs 2,881 crore in the quarter ended September 2014 compared to Rs 1,914 crore in the same quarter last year driven largely by US business that reported a 60.7 percent growth during the quarter.

Europe business in July-September quarter increased by 349.3 percent while rest of the world business showed a 67.2 percent growth compared to year-ago period.

The market consolidates with a negative bias. The Sensex is down 104.93 points at 27810.95 and the Nifty is down 23.25 points at 8315.05. About 1281 shares have advanced, 1496 shares declined, and 96 shares are unchanged.

Dr Reddy's Labs, Axis Bank, Hindalco, Sun Pharma and Infosys are top gainers in the Sensex. Among the losers are Sesa Sterlite, BHEL, GAIL and SBI.

Asian shares edged down on ahead of US employment data later in the session, while the euro wallowed around two-year lows after European Central Bank President Mario Draghi vowed to take more easing steps to spark growth in the euro zone.

Investors were likely to remain cautious ahead of the key US nonfarm payrolls report. Solid gains in employment are projected, and could increase speculation the Federal Reserve could raise US interest rates in the middle of next year.

12:50pm Syndicate Bank under pressure
Public sector lender Syndicate Bank's net profit slipped 32.9 percent year-on-year to Rs 315.6 crore in July-September quarter dented by higher provisions and tax cost but was supported by higher other income. Profit in the same quarter last year was Rs 470 crore.

Net interest income, the difference between interest earned and interest expended, increased marginally to Rs 1,422.5 crore in the quarter ended September 2014 compared to Rs 1,411 crore in the year-ago period. Other income (non-interest income) jumped 58 percent to Rs 437 crore from Rs 276.4 crore during the same period.

In September quarter, domestic net interest margin of the bank improved sequentially to 2.96 percent from 2.86 percent and global net interest margin expanded to 2.57 percent from 2.47 percent. The stock fell 2 percent.

12:25pm Brent crude update
Brent crude dropped for the second straight session today, dragged below USD 83 by worries over the strong US dollar.

The dollar held near a four-year high against a basket of major currencies, with its near-term fortunes hinging on whether US jobs data will add to or temper optimism about the US economy's outlook.

A stronger greenback makes it more expensive for holders of other currencies to buy dollar-denominated commodities.

Brent had dropped 52 cents to USD 82.34 a barrel by 0625 GMT after falling as much as 90 cents the session before. It has fallen around 4 percent so far this week.

US crude eased 42 cents to USD 77.49 a barrel, reports Reuters.

12:00pm Market Check
Equity benchmarks continued to consolidate with a negative bias in noon trade, weighed down by HDFC Bank that fell 1.6 percent as the MSCI has deleted it from its India index.

The Sensex declined 92.45 points to 27823.43 and the Nifty slipped 17.20 points to 8321.10. About 1250 shares have advanced, 1442 shares declined, and 89 shares are unchanged.

Ranbaxy, Sun Pharma and Dr Reddy's Labs are in focus as Ranbaxy reacted to the USFDA withdrawing tentative approval on Valcyte and Nexium generic and forfeiting 180-day exclusivity on Valcyte generic. Ranbaxy recovered nearly 6 percent from day's low, up 0.44 percent. Dr Reddy's gained 3 percent as it received USFDA approval for Valcyte generic.

Bank of Baroda recovered marginally after reacting to disappointing earnings in the second quarter. Profit fell over 5 percent against estimates of growth of more than 5 percent and asset quality ratios worsened.

Larsen and Toubro (the most active stock) traded almost a percent lower ahead of its Q2 numbers today. A CNBC-TV18 poll expects net sales to rise by around 11 percent driven by the infra segment while profits are expected to increase 12 percent to Rs 970 crore on a standalone basis.

DLF surged nearly 6 percent as the Securities Appellate Tribunal or SAT has allowed the realty major to redeem Rs 1,806 crore from mutual funds till next month. Meanwhile Hero Motocorp lost 2.5 percent as 2.9 percent equity shares changed hands today and most likely Bain Capital was the seller.

In the midcap space, Aurobindo Pharma surged over 3 percent and hit a life high of Rs 1,043 after reporting a whopping 58.3 percent growth in consolidated net profit at Rs 372 crore for July-September quarter led by US generics year-on-year.

11:50 am Results: Public sector lender Bank of Baroda 's second quarter net profit fell 5.5 percent year-on-year to Rs 1,104 crore due to higher provisions and tax rate, and slow growth in non-interest income. Profit in the year-ago period was Rs 1,168 crore.

Net interest income, the difference between interest earned and interest expended, climbed 17.5 percent on yearly basis to Rs 3,401 crore from Rs 2,895 crore while other income (non-interest income) grew by 1.8 percent to Rs 991.65 crore during the same period. Profit was well below the street expectations of Rs 1,233 crore while net interest income was tad above estimates of Rs 3,360 crore for the quarter.

11:20 am Pharma: The US Food and Drug Administration (FDA) said it has granted final approval to Indian drugmaker Dr Reddy's Laboratories and US firm Endo International Plc to make cheaper copies of Roche Holding AG's anti-viral Valcyte. The move comes after Ranbaxy Laboratories that FDA had stripped the company of its tentative approval to launch the first copy of the drug due to quality control issues at its manufacturing plants.

Ranbaxy, whose all India-based manufacturing plants have been banned by the FDA from exporting to the United States, also lost its rights to a six-months market exlusivity for Valcyte generic.

The market is on a losing spree. The Sensex is down 84.78 points at 27831.10 and the Nifty slips 18.45 points at 8319.85. About 1113 shares have advanced, 1310 shares declined, and 88 shares are unchanged.

Axis Bank, Dr Reddy's Labs, Cipla, HUL and Tata Motors are top gainers in the Sensex. Among the losers are HDFC Bank, Hero MotoCorp, M&M, GAIL and Sesa Sterlite.

Globally, Asian markets are mostly higher on assurance from the European Central bank to do more to fuel growth and confirmation from the Chinese central bank that it injected liquidity into the banking system.

Crude palm oil prices moved up by 0.47 percent to Rs 452.30 per 10 kg in futures trade today as speculators created fresh positions amid pick-up in demand in spot markets against tight supplies from producing regions. At the Multi Commodity Exchange, crude palm oil for delivery in November traded higher by Rs 2.10, or 0.47 percent, to Rs 452.30 per 10 kg in a business turnover of 24 lots.

10:59am Interview
Godrej Properties sees robust portfolio launched for the second half of FY15 said MD & CEO, Pirojsha Godrej in an interview to CNBC-TV18.

According to him, the real estate market is likely to pick up in Mumbai and Haryana. ''Now with new State governments in place in both Maharashtra and Haryana, our sense is that the real estate market in both these cities and for that matter in the rest of the country should start picking up," he added.

The company has new launches planned in Pune, NCR and Nagpur.

Real estate developer Godrej Properties ' second quarter consolidated net profit jumped 35.9 percent year-on-year to Rs 46.6 crore led by lower tax rate and minority interest payment. Profit in the year-ago period was Rs 34.3 crore.

10:30am Market Expert
This is a market in which investors should buy on dips feels Vibhav Kapoor, Group Chief Investment Officer, IL&FS. In an interview to CNBC-TV18, Kapoor said the market was right now banking on hope and trying to discount FY16 numbers instead of FY15 numbers, be it macro or corporate earnings.

Kapoor said the the macro environment still looked a bit uncertain at the moment, but there were enough signs of an improvement in FY16.

He said most stocks were looking expensive in the short term, but investors would do well to buy and hold on to good stocks for 12-15 months. Kapoor is bullish on cyclicals, particularly auto and financials.

10:00am Market Check
Equity benchmarks witnessed profit booking in morning trade with the Sensex losing 152.73 points to 27763.15 and the Nifty falling 38.95 points to 8299.35. About 1055 shares have advanced, 1190 shares declined, and 69 shares are unchanged.
 
Aditya Narain, Citigroup says overall earnings revision index has slipped back into negative territory which should prompt a reality check on expectations.

"While we remain comfortable with our market view of 31,000 on the Sensex by December 2015, the market will have to earn its way there," he adds.

Bank of Baroda fell 2.8 percent after its net profit declined 5.5 percent to Rs 1,104 crore in September quarter compared to Rs 1,168 crore in the year-ago period.

Hero Motocorp lost 2.27 percent after 87.4 lakh shares (2.9 percent equity) of the company exchanged hands on NSE at Rs 2,874-2,917 apiece.

NMDC, Asian Paints, Coal India, Mahindra & Mahindra, Gail and HDFC Bank declined 1.5-2 percent while Dr Reddy's Labs, Cipla, HUL, Axis Bank, DLF, Zee Entertainment, BPCL and ACC gained 1-3 percent.

9:50 am Market outlook: This is a market in which investors should buy on dips feels Vibhav Kapoor, Group Chief Investment Officer, IL&FS. In an interview to CNBC-TV18, Kapoor said the market was right now banking on hope and trying to discount FY16 numbers instead of FY15 numbers, be it macro or corporate earnings. Kapoor said the the macro environment still looked a bit uncertain at the moment, but there were enough signs of an improvement in FY16.

He said most stocks were looking expensive in the short term, but investors would do well to buy and hold on to good stocks for 12-15 months. Kapoor is bullish on cyclicals, particularly auto and financials.

9:30 am Buzzing: Drug firm Ranbaxy Laboratories today said the US health regulator has revoked its tentative approvals for its generic anti-viral drug and stomach and esophagus problems treatment tablets. "As a consequence, in FDA's view, Ranbaxy has forfeited its eligibility for 180-day exclusivity for its ANDA for valganciclovir hydrochloride tablets USP, 450 mg," Ranbaxy Laboratories said in a filing to BSE.

The communication from US Food and Drug Administration (USFDA) said that Ranbaxy's ANDAs of concern did not have any data integrity issues. However it added that "its original decisions granting tentative approvals were in error because of the compliance status of the facilities referenced in the ANDAs at the time the tentative approvals were granted."

The market has opened on a tepid note. The Sensex is down 37.16 points at 27878.72, and the Nifty is down 7.30 points at 8331.00. About 555 shares have advanced, 184 shares declined, and 46 shares are unchanged.

Tata Motors, Axis Bank, ITC, Dr Reddy's and Tata Steel are top gainers in the Sensex. Among the losers are Sun Pharma, Hero, M&M, Coal India and HDFC Bank. Ranbaxy lost 4 percent.

The Indian rupee fell 11 paise in early trade. The currency opened at 61.52 a dollar compared to Wednesday's closing value of 61.41 per dollar. The market was shut on Thursday for public holiday.

Pramit Brahmbhatt, Veracity expects the rupee to trade weak as overnight dollar is trading strong ahead of payrolls data due for the day. "Strength in dollar will keep rupee under pressure. The range for today is seen between 61-62/USD," he adds.

In the US on Thursday stocks climbed, lifting the Dow and S&P 500 to records, after upbeat economic reports in the US Jobless benefits fell by 10,000 to 278,000 last week, to 285,000.

In Europe, the ECB president Mario Draghi assured that the bank would adopt further easing measures, if needed. Yesterday, it decided to keep interest rates unchanged in its monetary policy review. However, president Mario Draghi's dovish comments soothed the equity markets and shares closed mixed.

The president had been the subject of speculation that members of the ECB governing council were planning to challenge him over his management and communication style.
In the Aisan markets, Nikkei saw some profit booking in Thursday's session but renewed its upmove as the yen move to 114, in the morning.

However, in the currency space, the euro languishes near two-year lows against the dollar after European Central Bank after Draghi renewed his pledge to take necessary steps to stimulate a sluggish euro zone economy.

In commodities, Brent crude prices flat near 82 dollars per barrell on  an apparent momentum towards a deal between iran and world powers over its nuclear program and higher u-s inventories

Gold prices drop further to 1140 dollars an ounce.

 

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