Sensex up 517 points, Nifty ends tad below 8500; banks lead
30 March 2015
03:30pm Market Closing: The market staged spectacular performance on Monday with the Nifty reclaiming 8500 level and Sensex hitting 28000-mark intraday led by banking & financials, FMCG, capital goods and IT stocks.
The Sensex surged 517.22 points or 1.88 percent to 27975.86 and the Nifty rallied 150.90 points or 1.81 percent to 8492.30. Nearly three shares advanced for every share declining on the Bombay Stock Exchange.
Idea Cellular was the biggest gainer on Nifty, up 6.21 percent. UltraTech Cement, Asian Paints, HDFC, Bharti Airtel, ONGC, Axis Bank and L&T rallied 3-5 percent. Hindalco, Tech Mahindra and Cairn India lost 1.5-3 percent.
The BSE Midcap and Smallcap indices gained 1.93 percent and 3.4 percent, respectively.
03:25pm FII View: Vivek Misra, Strategist- Asian Equities, Global Research & Strategy, Societe Generale, said he is overweight on both India and China, with the latter being his top pick.
According to Misra, the investor flows have been relatively strong into India. He expects relatively strong earnings from Indian corporates over the next 2 years, with signs of improvement being visible in 2-3 quarters.
Societe Generale expects potential upside of 32 percent in India by 2016 and has a Sensex target of 32,500 by the end of 2015, Misra said.
03:15pm Nifty eyes 8500: The Sensex rallied 520.10 points or 1.89 percent to 27978.74 and the Nifty climbed 154.40 points or 1.85 percent to 8495.80.
About 2042 shares have advanced, 746 shares declined, and 147 shares are unchanged on the BSE.
03:00pm Market Update: The market gained more strength in last hour of trade. The Sensex rallied 480.04 points or 1.75 percent to 27938.68 and the Nifty rose 140.35 points or 1.68 percent to 8481.75. About 1987 shares have advanced, 725 shares declined, and 139 shares are unchanged on the BSE.
Bank Nifty gained 250 points as State Bank of India, ICICI Bank, HDFC Bank and Axis Bank rallied 1-2.6 percent. Housing finance company HDFC, cigarette major ITC and state-run oil company ONGC climbed over 3 percent.
02:50pm Global Markets: Shares rose today with Asian stocks buoyed by hopes for stimulus to boost China's economy, but the euro slipped on more concern about Greece's finances.
In Europe, a rally in technology shares, tracking Friday's surge in the US tech sector, helped equities bounce back from losses last week, although Athens' stock market was down on concern about whether the country will be able to reach agreement with its creditors.
Germany's DAX index rose 1.5 percent, Paris gained 1.2 percent and the overall FTSE Eurofirst index of 300 leading European companies was up by 1.1 percent.
Chinese stocks surged to seven-year highs, helped by Beijing's unveiling of an ambitious plan to build a modern Silk Road to Europe and Africa and signs from People's Bank of China Governor Zhou Xiaochuan that added to expectations of more monetary policy easing.
Shanghai shares were up another 2.5 percent today, the market's best day since the middle of January.
02:40pm Interview: Irfan Razack, CMD of Prestige Estates said the company is confident of beating FY15 sales guidance of Rs 5000 crore backed by a healthy demand scenario.
The company did pre-launch of six projects in Bangalore and it is also seeing a good response for their new projects in Hyderabad.
Going forward they are confident of attaining 15-20 percent growth and expect revenues from Kochi and Chennai to improve significantly in FY16.
02:20pm Gold Update: Gold dropped for a second straight session today, slipping further from a three-week high, as the dollar climbed after Federal Reserve Chair Janet Yellen signaled the US central bank may be on course to raise interest rates later this year.
Bullion may be set to give up recent gains fueled by the Fed's March policy statement that it was prepared to move more slowly in hiking US rates than the market expected. The metal rose for seven consecutive sessions after the Fed's meeting this month in its longest rally since 2012.
On Friday, Yellen said an increase in the Fed's benchmark rate "may well be warranted later this year" given sustained improvement in US economic conditions.
Bullion is headed for a second consecutive monthly drop in March as a looming US rate hike dims the appeal of a non-interest bearing asset.
02:00pm Market Check:
Bulls kept complete control over Dalal Street today. The Sensex extended rally, up 401.19 points or 1.46 percent at 27859.83 and the Nifty surged 111.50 points or 1.34 percent to 8452.90.
The broader markets also gained further with the BSE Midcap and Smallcap indices rising 1.6 percent and 2.8 percent, respectively. About 1911 shares have advanced, 723 shares declined, and 133 shares are unchanged on the BSE.
UltraTech Cement, Idea Cellular, ONGC, ITC, Bharti Airtel and Coal India topped the buying list on Sensex, up 3-4 percent.
HDFC gained 2.5 percent after Keki Mistry told CNBC-TV18 that with regards to HDFC Life the timing or amount of IPO is not decided yet and Standard Life will want to increase stake in HDFC Life but the quantum is not decided. Separately, they see scope of further 25 to 50 bps rate cuts but don't expect any movement on April 7.
Shares of HDFC Bank, L&T, Axis Bank, ICICI Bank, TCS, SBI, HUL, Wipro, Hero Motocorp and Tata Steel climbed 1-2 percent whereas Reliance Industries, Hindalco Industries and Tata Power remained under pressure.
01:30pm Market Update: The market moved up further following rally in global peers. The Sensex surged 363.11 points or 1.32 percent to 27821.75 and the Nifty rose 104.15 points or 1.25 percent to 8445.55.
About 1848 shares have advanced, 703 shares declined, and 140 shares are unchanged on the BSE.
01:20pm Crompton in News: Avantha Group company Crompton Greaves has bagged an order worth Rs 115 crore from central transmission utility Power Grid Corporation for supply of power equipment.
"The scope of this Rs 115 crore contract from Power Grid, to be executed in 20 months, include design, engineering, manufacture, shop testing, supply, erection testing and commissioning at site, and other associated civil works," Avantha Group said in a statement.
These reactors will be installed at Power Grid's Vemagiri and Srikakulam sub-stations in Andhra Pradesh.
01:00pm Market Check
It is a strong day of trade on Dalal Street as the equity benchmarks gained more than a percent led by telecom and FMCG stocks.
"Downside risks to the market are limited to 3-4 percent from here, while we forecast 15 percent upside potential for the Nifty to 9,600 from 9,940 earlier," says Rakesh Arora, Macquarie.
The Sensex gained 324.40 points at 27783.04 and the Nifty surged 88.80 points to 8430.20. Advancing shares outnumbered declining ones by a ratio of 1807 to 697 on the Bombay Stock Exchange.
Telecom stocks like Idea and Bharti Airtel spiked more than 4 percent each. Bank of America Merril Lynch upgraded Idea to a buy with a revised target of Rs 205. MD and CEO Himanshu Kapania of Idea told CNBC-TV18 that a significant jump in debt will be balanced by cash flows.
Shares of ITC, HDFC, Larsen & Toubro, ONGC, Axis Bank and Coal India continued to lead the market higher. However, Reliance Industries, Tata Motors, Hindalco and Tata Power remained under pressure.
The Indian rupee fell 22 paise to 62.63 a dollar in afternoon trade.
12:40pm Jefferies on Tata Motors: Brokerage house Jefferies feels the market underestimating the value of Tata Motors' domestic business.
''As troubled as the business is today, the signs of turnaround are visible, the extent of margin improvement significant and contribution to overall value material. Recently announced equity issuance is long overdue and welcome in the interest of risk mitigation,'' the Jefferies note to clients says.
The brokerage has raised target price of the company 'marginally' to Rs 669.
Jefferies sees Tata Motors medium and heavy commercial vehicle sales volumes growing 23.5 percent over FY15-17 boosted by recovery in commercial vehicle cycle.
''Passenger vehicle sales will likely grow 22.3 percent in this period on the back of new products (2 launched, 2 more in 1HFY16), recovering from an extremely low base. Combined, we expect ASP (average selling price) to grow 6.3 percent and per unit costs to grow around 0.3 percent, resulting in EBIT margins increasing to 2.6 percent in FY17E, still about 600 basis points below peak,'' says the note.
12:20pm Infosys hikes salary: The country's second largest software services will give 15-20 percent salary hike to the top performers, say sources. The intention behind this move clearly seems to be to curb attrition, which the company has been struggling with it.
On Friday, the compnay said they would give out pay hikes in the range of 6.5 percent to 9 percent to employees in India for the financial year 2015-16.
While the overall average wage hike would be effective from April 1, which is 1-2.5 percent for onsite and 6.5 percent for offshore, higher performers would get a hike of 9.5 percent and the top performers would get 15-20 percent hike. For this, per team one to two percent of the top most employees have been scrutinized, say sources.
This step would not only encourage people to work better by increasing utilisation but also help the company contain attrition. This is the highest hike by company had done in the last three years for top performers.
12:00pm Market Check
The 50-share NSE Nifty held its 8400 level in noon trade led by capital goods, banks and FMCG stocks. The index rallied 68.45 points to 8409.85 and the Sensex climbed 248.95 points to 27707.59.
The broader markets continued to outperform benchmarks. The BSE Midcap gained 1.2 percent and Smallcap surged 2.3 percent. Nearly three shares advanced for every share declining on the Bombay Stock Exchange.
Bharti Airtel topped the buying list, up 3.6 percent followed by HDFC, ITC, Coal India and BHEL with 2-2.5 percent rally. L&T, HDFC Bank, Axis Bank, HUL, M&M, Wipro and Cipla climbed 1-1.9 percent whereas Reliance Industries, Hindalco Industries, GAIL and Tata Power fell 1.3-1.9 percent.
Telecom stocks like Idea Cellular gained more than 4 percent. Bank of America Merril Lynch upgraded the stock to a buy with a revised target of Rs 205. The management told CNBC-TV18 that a significant jump in debt will be balanced by cash flows.
Oil & gas companies continued to be in focus on account of the likelihood of gas prices being cut to USD 5.02 per mmbtu effective April 1, 2015. Analysts say the lower gas prices will impact the likes of ONGC where a 10 percent fall in gas prices is likely to impact earnings by 9 percent. Analysts also believe that this has been priced in by recent fall in stock prices.
Globally, Asian markets gained with Chinese markets at new high as a modestly positive lead from Wall Street offset the impact of sliding oil prices. Brent crude slipped below USD 56 a barrel.
11:30am Buzzing: HDFC gained over 2 percent after Keki Mistry told CNBC-TV18 that with regards to HDFC Life the timing or amount of IPO is not decided yet and Standard Life will want to increase stake in HDFC Life but the quantum is not decided. Separately, they see scope of further 25 to 50 bps rate cuts but don't expect any movement on April 7.
Idea Cellular saw a bounceback today. BoAML has upgraded Idea to buy from neutral. According to them, Idea was the most vulnerable in the upcoming auction with around 70 percent of revenue at risk but with the regulatory overhang behind, BoAML expects the focus to return to operations. They prefer Idea to Bharti Airtel.
11:00am Market Check:
The market has maintained its strong momentum with the Nifty trading at 8400 supported by telecom, banking & financials, IT and FMCG stocks. The broader markets continued to outperform benchmarks with the BSE Midcap and Smallcap indices rising 1.3 percent and 2.3 percent, respectively.
The Sensex surged 281.01 points or 1.02 percent to 27739.65 and the Nifty rallied 75.40 points or 0.90 percent to 8416.80. About 1703 shares have advanced, 540 shares declined, and 120 shares are unchanged on the BSE.
Asian markets traded mostly higher. Shanghai markets hit a new high as a modestly positive lead from Wall Street offset the impact of sliding oil prices. Crude continued to decline with the Brent trading near USD 56 per barrel.
Oil and gas companies remained in focus on account of the likelihood of gas prices being cut to USD 5.02 per mmbtu effective April 2015. Analysts say the lower gas prices will impact the likes of ONGC where a 10 percent fall in gas prices is likely to impact earnings by 9 percent. Reliance Industries is expected to see a small impact as analysts say gas is now a small component of its business.
Staying with the story city distribution gas stands to benefit as the segment will get 100 percent allocation of cheap domestic gas which will enhance margins. According to Edelweiss, Indraprastha Gas will be the largest beneficiary while GSPL will benefit via stakes in city gas companies.
10:52am Market Update: The Sensex rose 317.15 points or 1.16 percent to 27775.79 and the Nifty climbed 85.35 points or 1.02 percent to 8426.75.
About 1660 shares have advanced, 451 shares declined, and 118 shares are unchanged on the BSE.
10:40am Market Expert: Sandeep S Shenoy of Pioneer Investcorp is of the strong belief that fundamentals in the market are not in sync with valuations, so choppiness could continue for some more time.
According to Shenoy, market is in a zone which suggests sell on all bounce back because valuations have gone ahead of fundamentals. However, he clarifies that the capital inflows into the market have not got impacted and continue to come in.
With regards to fundamentals there are already some downgrades happening, says Shenoy. There are some talks of FY15 EPS being slashed downwards and one might also see a down tick of 7-8 percent for the FY16 EPS compared to what was projected last September believes Shenoy.
According to Shenoy, even a 7-10 percent draw down from the current levels may not impact the extreme long-term investors so much and it may also not impair the structural bull run but the short-term investors could get slaughtered. However, one can insulate from this draw down by staying away from cylicals and sticking to cash flow positive companies, he adds.
10:20am Railway stocks in focus: The ministry has been relying on Finance Ministry for financial support, but the Railways has adequate funds for at least 5 years, said Railway Minister Suresh Prabhu.
In an exclusive interview to CNBC-TV18, Prabhu said the national transporter is losing money due to lack of investment in scale of operations. He feels dedicated freight corridors will help bring in more investments. Even tax-free bonds are a good avenue available to Railways, he said.
Prabhu said the ministry is in advanced stage of negotiations with agencies like IMF and World Bank. Stating that the ministry is not ruling out any avenue of fund raising at this stage, the Prabhu said he is even open to talking to sovereign funds and private equity firms for funding. ''The cycle of under-investing in Indian Railways is hopefully behind us,'' the minister said.
10:00am Market Check
The market extended gains led by banking & financials, FMCG, telecom, capital goods and technology stocks. The Sensex climbed 246.48 points or 0.90 percent to 27705.12 and the Nifty jumped 67.70 points or 0.81 percent to 8409.10.
The broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising 1.4 percent and 2.2 percent, respectively. More than 4 shares advanced for every share declining on the Bombay Stock Exchange.
Rakesh Arora, Macquarie says, "Downside risks to the market are limited to 3-4 percent from here, while we forecast 15 percent upside potential for the Nifty to 9,600 from 9,940 earlier."
Telecom stocks rebounded today after the sell-off seen on Friday. Idea Cellular and Bharti Airtel gained 2.5 percent each.
Shares of HDFC, ITC, L&T, SBI, Axis Bank, M&M, HUL, Cipla, Wipro, NTPC, Tata Steel, Sesa Sterlite and BHEL were prominent gainers in trade, up 1-2 percent. ICICI Bank, HDFC Bank, Infosys and Sun Pharma advanced over half a percent.
However, Reliance Industries, Hindalco Industries, Bajaj Auto, Dr Reddy's Labs and GAIL underperformed.
09:45am CLSA on Bharti Infratel: Brokerage house CLSA has retained its buy rating on Bharti Infratel with a price target of Rs 450.
''Infratel's EV/Ebitda discount to global peers has reduced from 67 percent in 2013 to 35 percent now, on the same lines as its RoE (Return on Equity) discount. Given the higher growth and operating leverage in the business, we expect Infratel's RoE to double by FY18 to 18% which could reduce the EV/Ebitda discount further,'' says the CLSA note to clients.
''Infratel had a consolidated net cash balance of Rs 3900 crore at the end of 3QFY15, and is generating free cashflow of Rs 2000-4000 crore annually. With the build-up of cash, management has stated its intent to further return excess cash to shareholders within the legal framework which could include a special dividend or share buyback,'' says the CLSA note
09:30am Wipro in News: The country's third largest IT exporter has reshuffled its top management in BFSI business that will be split between 2 leaders.
Wipro's new BFSI heads will report to global head of BFSI, Shaji Farooq while Angan Guha will head Wipro's North America, Australia, India, ME & EM business.
Angan Arun Guha currently heads Citigroup business unit at Wipro. Shailendra Singh will oversee Wipro's Rest Of The World operations. Shailendra currently heads South Africa division of Wipro.
Reshuffle came after erstwhile head Rajan Kohli was moved to digital business.
Wipro told CNBC-TV18 that the company will align its BFSI unit along geographical lines. "Reshuffle will be effective from April 1 and will further improve competitiveness. It will better serve the needs of global client footprint," it said.
09:15am Market Check:
The market rebounded sharply on Monday, tracking positive global cues. The Sensex rallied 197.15 points or 0.72 percent to 27655.79 and the Nifty reclaimed 8400, up 60.80 points or 0.73 percent at 8402.20. About 474 shares have advanced, 71 shares declined, and 88 shares are unchanged on the BSE.
Wipro, HDFC, Sesa Sterlite, M&M, Bharti Airtel, ITC, BPCL, Idea Cellular and Asian Paints rallied 1-1.5 percent.
The Indian rupee opened lower by 15 paise at 62.56 per dollar on Monday against Friday's closing value of 62.41 a dollar.
The dollar holds steady after the head of the US Central Bank assured investors that the path back to 'normal' interest rates will only occur at a gradual pace.
Agam Gupta of Standard Chartered said, "Expect year-end dollar inflows to continue in this shortened week."
He further added, "Exporters will continue to sell on upticks to levels of 62.65-62.70 and local government banks will mop up dollars on any downticks to 62.35-62.40/dollar. Expect it to be a rangebound day with good two way interest."
Among global markets, in the US, stocks closed mildly higher as investors digested Fed Chair Janet Yellen's remarks remained cautious ahead of first quarter earnings in April. Yellen said a rate increase may be warranted later this year, adding that an increase in core inflation is not essential before the fed raises rates.
The third estimate for Q4 US GDP came in unchanged at 2.2 percent. While corporate profits fell, consumer spending was revised higher to 4.4 percent from 4.2 percent, the fastest rate since the first quarter of 2006.
And in Asia, shares opened with a positive bias. Softer than expected factory output from Japan hurt sentiment, February industrial production fell 3.4 percent month-on-month, biggest drop since June 2014.
Among commodities, oil prices slipped as Iran and six world powers tried to reach a deal that could add oil to the market if sanctions against Tehran are lifted.
From precious metals space, gold snapped its rally to slip below USD 1200 an ounce as dollar steadies.