Sensex sheds 152 points, Nifty weak; SBI, BHEL, Reliance drag

19 Mar 2015

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03:20pm Market close: The market ended lower. The Sensex was down 152.45 points or 0.5 percent at 28469.67 and the Nifty slipped 51.25 points or 0.6 percent at 8634.65. About 1123 shares advanced, 1714 shares declined and 195 shares were unchanged. Axis Bank, BHEL, SBI, Reliance and ICICI Bank were laggards. Among the gainers were GAIL, TCS, NTPC, ONGC and Tata Steel.

03:10pm Market Update: The market washed out all its gains. The Sensex plunged 165.19 points to 28456.93 and the Nifty fell 70.10 points to 8615.80.

About 1125 shares have advanced, 1619 shares declined, and 197 shares are unchanged on the BSE.

03:00pm BNP Paribas may exit AMC biz: Sources suggested that BNP Paribas may look at exiting its asset management business in India, reports CNBC-TV18.

According to sources, BNP Paribas wants to consolidate its operations in India and wants to exit its non-core assets. The company is learnt to have invited expression of interest (EoI) from prospective buyers. Private equity player KKR is said to have expressed interest to acquire stake.

BNP Paribas may sell part or complete stake in the business, sources said, adding that the company's new CEO Sharad Sharma has given a mandate to optimise operations.

02:45pm Market off day's high: The market trimmed gains in last hour of trade. The Sensex advanced 76.63 points to 28698.75 and the Nifty rose 19.50 points to 8705.40, dragged by Reliance Industries, HDFC Bank, SBI, ICICI Bank and Axis Bank.

The market breadth too turned in favour of declines. About 1282 shares have advanced, 1438 shares declined, and 189 shares are unchanged on the BSE.

02:30pm FII View: Richard Gibbs of Macquarie Securities believes the US central bank's removal of a reference to being ''patient'' on rates from its policy statement has pushed the rate hike to as late as September.

In an interview to CNBC-TV18, Gibbs says the Fed is focusing on price stability and full employment.

Furthermore, he expects India to be a greater beneficiary of capital inflows and expects the growth differentiation between India and China to widen further.

02:00pm Market Check:
The market continued to see buying interest following the Federal Reserve statement lastnight saying rate hikes won't start until the labour market has healed further and the 2 percent inflation target looks achievable.

The Sensex rose 212.68 points to 28834.80 and the Nifty advanced 62.80 points to 8748.70. The market breadth has been in favour of advances.
 
Jitendra Sriram of HSBC said the market will be rangebound here on. Earnings growth is likely to be muted till June quarter, he added, while he maintained December 2015 Sensex target at 30000.
 
Lupin, Asian Paints and Tata Steel topped the buying list on Nifty, up 4 percent each. GAIL, Sun Pharma, L&T and TCS gained 1.6-2.8 percent.

The rupee too recovered today to trade at 2-week high post dovish statements from Federal Reserve, up 10 paise to 62.59 a dollar.

Global markets traded mostly in the green today. Hong Kong rallied 350 points while European markets traded with more than 0.5 percent gains. Crude slipped in afternoon trade with the NYMEX falling 1 percent to USD 43 a barrel as US stockpiles increased.

1:45 pm IPO? Business services and staffing company Quess Corp, a subsidiary of Thomas Cook India , has received board approval relating to its raise long-term funding needs, options that could also include coming out with an initial public offering (IPO), CMD Ajit Isaac told CNBC-TV18. Quess, earlier known as Ikya, was acquired by Thomas Cook India in early 2013, a company known in analyst circles for its aggressive acquisition strategy as well as rapid growth. The travel-services firm Thomas Cook India itself is owned by legendary Canada-based investor Prem Watsa of Fairfax Financial, and with an 85 percent annualized five-year revenue growth at Quess, an IPO for the subsidiary will be closely watched by some investors.

1:30 pm Buzzing: Shares of Wockhardt rallied 5.4 percent intraday after the US health regulator did not find any issues at Chikalthana plant. The stock hit a 52-week high at Rs 1980.

The drug maker on Wednesday said there were no findings with respect to data security and control measures in laboratory and manufacturing at Chikalthana plant in a recent inspection by US Food and Drug Administration (USFDA). However, the US health regulator suggested continuous voluntary compliance for "desired quality culture".

According to the pharma firm, the recent inspection at the Aurangabad L1-Chikalthana site was a follow-up inspection by the US FDA as an outcome of completion of good manufacturing practise (GMP) remediation submitted by Wockhardt in October 2014.

The market is still maintaining its uptrend as the Sensex is up 181.81 points at 28803.93. The Nifty is up 50.15 points at 8736.05. About 1363 shares have advanced, 1205 shares declined, and 178 shares are unchanged.

Tata Steel, Sun Pharma, GAIL, L&T and TCS are top gainers in the Sensex. Among the losers are Reliance, HDFC Bank and M&M.

Short-term US yields boasted their biggest drop in six years after the Federal Reserve trimmed forecasts for inflation and growth, and said unemployment could fall further than first thought without risking a spike in inflation.

The median projection for the Fed funds rate at the end of 2015 was cut to 0.625 percent, down half a point from December. Fed Chair Janet Yellen also sounded uncomfortable with the strength of the dollar, saying it would be a "notable drag" on exports and a downward force on inflation. The Fed's seeming caution on hikes rattled the dollar as investors have been massively long in the expectation its interest rate advantage could only get wider.

12:55pm Interview: Business services and staffing company Quess Corp, a subsidiary of Thomas Cook India, has received board approval relating to its raise long-term funding needs, options that could also include coming out with an initial public offering (IPO), CMD Ajit Isaac told CNBC-TV18.

Quess, earlier known as Ikya, was acquired by Thomas Cook India in early 2013, a company known in analyst circles for its aggressive acquisition strategy as well as rapid growth.

The travel-services firm Thomas Cook India itself is owned by legendary Canada-based investor Prem Watsa of Fairfax Financial, and with an 85 percent annualized five-year revenue growth at Quess, an IPO for the subsidiary will be closely watched by some investors.

Isaac, however, said it was too soon to whether or when the company would issue a public offer.

12:40pm Kotak on Oil India: Kotak upgraded Oil India to buy from add previously with an unchanged target price of Rs 615, as it believes the stock is discounting a fairly bleak scenario of no improvement in net crude realisations after subsidy burden.

Potential clarity on the subsidy-sharing mechanism, likely by May 2015, may ensure higher level of net crude realizations and provide comfort to earning estimates. Inexpensive valuations and good dividend yield of around 5 percent will provide adequate support on the downside, says the brokerage.

12:25pm Market Expert: The US Federal Reserve event has only been postponed by 2-3 months and the dollar strength is here to stay, is the word coming in from Harendra Kumar, head of institutional broking and global economy at Elara Capital.

He believes if the market continues to stay higher, long-term investors and traders will look to book profits and the market will go into a consolidation phase.

According to Kumar, the market will once again become a buy once the Nifty hits 8400-odd levels. He recommends investors to sell on every rally.

Inflows into India can remain flattish, he says and hence is worried on financials in the interim.

12:00pm Market Check:
The market remained firm though it came off day's high. The Sensex gained 201.17 points at 28823.29 and the Nifty jumped 55.50 points to 8741.40 led by banks, FMCG, pharma, IT and capital goods stocks.

The broader markets too traded in line with benchmarks. The BSE Midcap and Smallcap indices gained 0.5 percent each. About 1382 shares have advanced, 1052 shares declined, and 171 shares are unchanged on the BSE.

Globally, Asian equities traded mostly higher as investors reacted to a dovish statement from the US Federal Reserve. Nikkei bucked the trend, trading weak owing to a stronger yen. Hang Seng, Straits Times, Kospi and Taiwan gained 0.4-1 percent while Shanghai was flat.

Lupin spiked 3.6 percent after receiving ANDA approvals for it's drug, Celebrex. Analysts expect 15 percent market share during exclusivity. Wockhardt too rallied 3 percent on news that USFDA gave a clean chit to its Chikalthana facility.

SpiceJet fell 3 percent as the Delhi High Court directed DGCA to de-register 6 planes of the company. Two Irish lessors had moved court seeking de-registration of planes alleging non-payment of dues.

Ortel Communications traded at 5 percent discount to its issue price of Rs 181 on first day. The management told CNBC-TV18 that they are confident of performing better in FY16 than FY15.

11:55 am Realty stocks: Shares of Maharashtra-based realty companies are on buyers' radar after the floor space index (FSI) booster in the state. Maharashtra Finance Minister Sudhir Mungantiwar, presenting the state Budget, announced enhancing premium on additional FSI which will result in substantial revenue gains. FSI is the ratio of a building's total floor area to the size of the piece of land upon which it is built. The minister said the government has promised to enhance the FSI limit from 0.33 to 0.60 and increase the rate of premium in Brihanmumbai Municipal Corporation limit. It is also under consideration of the government to enhance the rate of premium on grant on all kinds of FSI. These gains in FSI will benefit individuals, but the government does not get benefit of revenue increase in the same proportion.

11:45 am Market outlook: Investors in South East Asia believe 9000 came too soon on the Nifty, says Rahul Arora, CEO, Nirmal Bang Institutional Equities. He believes the expectation from the government is exceeding what is actually happening on the ground.

According to him, the Nifty will consolidate between 8400-8500 over the next 4-5 months. He says people are buying the growth story on pharma and consumer durables.

He doesn't see any concern on Bank Nifty as a whole. Among private sector banks – in the midcap space – his top pick is Federal Bank.

11:30 am Buzzing: Shares of Larsen & Toubro jumped over 2 percent intraday on Thursday after its construction arm won orders worth Rs 1255 crore across various business segments in March 2015 so far.

The company's building and factories business secured a major order for design and construction of a residential building worth Rs 825 crore from a premium developer in Bengaluru. The power transmission and distribution business bagged new orders worth Rs 430 crore.

On global front, L&T secured an order from a private developer for design, supply, installation, testing and commissioning of a 132/11 KV substation in Dubai.

The market is firmly in the green supported by the global risk off trade. The Sensex is up 226.90 points or 0.7 percent at 28849.02 and the Nifty is up 61.15 points or 0.7 percent at 8747.05. About 1426 shares have advanced, 779 shares declined, and 160 shares are unchanged.

Tata Steel, Sun Pharma, GAIL, Axis Bank and L&T are top gainers in the Sensex. Among the losers are NTPC, Bajaj Auto and Bharti Airtel.

Rupee rises in line with other emerging market currencies, It is close to a 2-week high against the dollar. Bonds trade higher as well.

Brent crude futures fell towards USD 55 a barrel after a bigger than expected crude stock build in the United States, though losses were limited by a weaker dollar as the Federal Reserve signalled a slower pace of interest rate hikes. Brent crude for May delivery fell 50 cents to USD 55.41 a barrel, after jumping as much as 6 percent in the previous session on the dollar's tumble.

US crude for April delivery dropped 90 cents to USD 43.76 a barrel, after ending the previous session 3 percent higher.

Globally Asian equities except Japan trade higher taking cues from the rebound on Wall Street overnight as investors reacted to the less aggressive timeline from the fed on raising rates. Japan however trades lower on account off a stronger yen. The dollar index saw a sharp drop for example seeing the steepest fall in the the euro in 6 years. Crude rose overnight with brent now trading above USD 55 and gold near 2-week highs.

10:58am Market Update: The Sensex rose 224.29 points to 28846.41 and the Nifty climbed 64 points to 8749.90.

About 1422 shares have advanced, 767 shares declined, and 164 shares are unchanged on the BSE.

10:45am FII View: Keith Parker, Barclays says as the March FOMC shifted the goalposts, the brokerage now expects the first rate hike in September.

"As expected, "patience" was dropped & the economic outlook was downgraded. We also now expect the target range for the federal funds rate to reach 50-75 bps in December versus 75-100 bps before," he adds.

10:30am New Listing: Investors turned sellers in Ortel Communications today, the day one. The stock fell 11.6 percent in opening trade to Rs 160.05 (the day's low) on the National Stock Exchange against the issue price of Rs 181.

It was trading at Rs 168.05, down Rs 12.95, or 7.15 percent currently while on the Bombay Stock Exchange, it was trading at Rs 171.95, down Rs 9.05, or 5 percent.

The Orissa-based cable TV services provider raised Rs 175 crore through the issue, which was opened for subscription during March 3-5. It had cut the size of offer for sale to sail through the issue on last day.

Total shares on sale were 1.2 crore shares, consisting 60 lakh shares fresh issue and 60 lakh shares offer for sale by New Silk Route. On last day, the size of offer for sale was reduced to 36.7 lakh shares.

10:00am Market Check
The market is in high spirits on Fed move. The Sensex is up 334.17 points or 1 percent at 28956.29 and the Nifty is up 93.10 points or 1 percent at 8779.00. About 1439 shares have advanced, 553 shares declined, and 143 shares are unchanged.

GAIL, Axis Bank, Sun Pharma, HDFC and L&T are top gainers while NTPC is still down.

World oil prices jumped as a cautious Federal Reserve statement offset data showing a big increase in US crude inventories. US benchmark West Texas Intermediate gained USD 1.20 to USD 44.66 a barrel after earlier falling to a new six-year low. European benchmark Brent oil for May delivery advanced USD 2.40 to USD 55.91 a barrel.

Crude prices surged after the Fed's statement, which noted that US economic growth had "moderated somewhat" since January. The Fed dropped a pledge to remain "patient" on raising interest rates, signaling a midyear federal funds rate hike remained possible after keeping it at the zero level for more than six years.

But other language in the Fed's statement emphasised that the central bank was in no rush to hike rates, sending the dollar lower.

9:55 am Trending: Shares of Maharashtra-based realty companies are on buyers' radar after the floor space index (FSI) booster in the state. Maharashtra Finance Minister Sudhir Mungantiwar, presenting the state Budget, announced enhancing premium on additional FSI which will result in substantial revenue gains.

FSI is the ratio of a building's total floor area to the size of the piece of land upon which it is built.

The minister said the government has promised to enhance the FSI limit from 0.33 to 0.60 and increase the rate of premium in Brihanmumbai Municipal Corporation limit. It is also under consideration of the government to enhance the rate of premium on grant on all kinds of FSI. These gains in FSI will benefit individuals, but the government does not get benefit of revenue increase in the same proportion.

9:45 am Buzzing: Shares of United Spirits jumped over 2 percent intraday on Thursday. CLSA retains buy rating on the stock with a target of Rs 4100 per share. The brokerage is positive on Indian spirits and USL remains its best play in the sector. The stock is up 36 percent in the past 3 months and CLSA feels it may remain range-bound in the near-term.

It says that addition of Diageo portfolio may further add to growth from Q1FY16. Over the next 12-15 months, USL plans to monetise some of the non-core assets to deleverage the balance sheet. ''The revenue growth in recent quarters was impacted due to price cuts in brands like Royal Challenge in north but this is now in the base and revenue growth should now improve,'' it states in a report.

However, CLSA also points out that concerns on wet goods' prices persists while glass prices are stable. Over the next 3-4 years, EBITDA margins should rise to high double digits even while higher advertising & promotions (A&P) spends would moderate FY16 margins to 8-10 percent.

9:30 am Market outlook: Harendra Kumar, head of institutional broking and global economy at Elara Capital believes if the market continues to stay higher, long-term investors and traders will look to book profits and the market will go into a consolidation phase. According to Kumar, the market will once again become a buy once the Nifty hits 8400-odd levels. He recommends investors to sell on every rally. Inflows into India can remain flattish, he says and hence is worried on financials in the interim. Kumar says the resumption of mining activity is a big positive for the Indian economy. He is bullish on Sesa Sterlite due to resumption on mining in Goa.

The market rallied in early trade following the dovish statement from the US Federal Reserve. The Sensex rose 187.74 points to 28809.86 and the Nifty rose 47.65 points to 8733.55. About 617 shares have advanced, 102 shares declined, and 81 shares are unchanged on the BSE.

The FOMC last night removed the word 'patient' from the text as expected, opening the door for rate increases, bolstering the bullish tone as it lowered its growth and inflation forecast and said hikes won't start until the labour market has healed further and the 2 percent inflation target looks achievable.

The Fed also noted that the change in rate guidance did not mean the FOMC had decided on the timing of a hike. Jannet Yellen added that the timing of initial increase in target range will be data dependant.

Back home, banking & financials, capital goods, auto, pharma and metals stocks gained. However, NTPC was the only loser on Sensex, down 1.4 percent.

The Indian rupee gained in the early trade following outcome of the Federal Reserve two-day meeting. The currency has opened higher by 31 paise at 62.38 per dollar against 62.69 a dollar Wednesday.

Mohan Shenoi of Kotak Mahindra Bank said, ''The Fed outcome has halted the dollar rally against major currencies along with stock and bond market rally. Markets in India are expected to follow suit. The rupee is expected to trade today in a range of 62.35-62.70/USD.

Globally, Asian stocks were mixed as investors reacted to a dovish statement from the US Federal Reserve. Dollar had its worst day versus the yen since December 2014. The Kospi opened up to a near six-month high led by brokerages and IT-related shares.

Stocks in the US closed sharply higher as investors cheered the Fed's statement. Dow Jones recovered a 150-point loss to close above 18,000. The CBOE VIX, fell more than 10 percent to trade below 14.

In Europe, equities closed mixed as investors digested the annual UK Budget statement in which finance minister George Osborne upped his economic growth forecast for 2016 to 2.3 percent but revised down growth figures for last year. Oil and gold prices gained after the Fed removed 'patient' from its statement.

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