Sensex, Nifty end lower amid volatility; metals surge
05 May 2015
03:30pm Market ends: After a volatile session, the market has ended in negative terrain. The Sensex ended down 50.45 points at 27440.14 and the Nifty was down 11.25 points at 8320.70. Metal stocks jumped with top gainers like Vedanta and Tata Steel. ONGC, Hindalco and HUL were other gainers in the Sensex. Among the losers were M&M, Bajaj Auto, HDFC, SBI and Coal India.
02:50pm South Indian Bank falls: South Indian Bank disappointed street on Tuesday with the fourth quarter net profit falling sharply to Rs 16.3 crore compared to Rs 124.6 crore in the year-ago period due to higher provisions.
Net interest income too declined 4.8 percent to Rs 347.1 crore from Rs 364.7 crore during the same period.
Provisions for bad loans jumped 4.9 times to Rs 137.7 crore during January-March quarter compared to Rs 28.3 crore in the corresponding quarter of last fiscal.
02:25pm Welspun Projects in focus: Welspun Projects today said Merrill Lynch Capital has raised its stake in the company to 7.55 percent . Prior to acquisition, Merrill Lynch Capital Markets Espana's stake in the company was 3.80 percent , Welspun Projects said in a regulatory filing.
The mode of acquisition was market purchase, it further said, adding that the buyout of 15 lakh shares by Merrill Lynch Capital took place on April 30.
Welspun Projects (WPL), formerly known as MSK Projects (India) and part of the Welspun Group, is into engineering, procurement and construction (EPC) projects across sectors like roads, water and industrial structures.
02:00pm Market Check
The market remained volatile with the Sensex falling 84.39 points to 27406.20 and the Nifty declining 21.90 points to 8310.05.
About 1237 shares have advanced, 1391 shares declined, and 182 shares are unchanged on the Bombay Stock Exchange.
Neelkanth Mishra of Credit Suisse says their FY16/17 Nifty EPS estimates have been cut by 2 percent & 1.3 percent, respectively, with bulk of the cuts from energy stocks like Cairn, industrials like BHEL & cement. Second half of earnings season will be weaker than first half in FY16, he adds.
Asian market hit by weakness today. Shanghai closed with a 4 percent cut, its biggest loss in the last 4 months on news reports that several Chinese brokerages have tightened requirements for margin financing. Hang Seng lost more than 350 points today.
In stock action, Kotak Mahindra Bank surged 5 percent post reporting earnings better than estimates with profits of Rs 527 crore, a growth of 30 percent. The bank also announced bonus issue of 1:1. NIIT Technologies gained 4 percent on fourth quarter earnings.
1:30 pm Market outlook: Neelkanth Mishra, Credit Suisse said FY16/17 Nifty EPS estimates have been cut by 2 percent/1.3 percent respectively, but with bulk of the cuts from energy (Cairn), industrials (BHEL) & cement, the pace of cuts should ease in coming quarters. According to him, IT cuts are unlikely to repeat. 2H of the earnings season may be weaker as PSU banks, utilities & metals companies report. FY15 Nifty EPS may settle at 6 percent YoY (against 8 percent now). However, later reporting companies may comment on revival in April-May operations, he added. According to Mishra, the April sell-off has been broad-based. He stays overweight on private banks, consumption, cement & IT.
The market is losing its grip as the Sensex is down 93.18 points at 27397.41 and the Nifty is down 33.15 points at 8298.80. About 1226 shares have advanced, 1256 shares declined, and 159 shares are unchanged.
Vedanta, Tata Steel, ONGC, Hindalco and TCS are top gainers in the gainers while Cipla, Bharti Airtel, M&M, NTPC and SBI are laggards.
Gulf oil exporters must reduce spending, including subsidies, and diversify their economies to cope with lower revenues caused by the sharp drop in crude prices, the International Monetary Fund said. Oil prices have shed half of their value since June 2014, and are expected to be lower than the breakeven point for Gulf countries in the next three to four years.
12:59pm Market Update: The Sensex rose 12.47 points to 27503.06 and the Nifty slipped 3.55 points to 8328.40. About 1273 shares have advanced, 1181 shares declined, and 152 shares are unchanged on the BSE.
12:55pm Tata Communications in News: Tata Communications today announced that it has been chosen by Formula One Management (FOM) to provide broadcast services for the GP2, GP3 and Porsche Supercup racing series.
It will provide a fully diverse end-to-end fibre and satellite solution to broadcasters from across the globe at the 12 race locations in 2015.
With this agreement broadcasters will have access to a provider with knowledge and experience in motor racing and the infrastructure capability to provide specific media management and movement services that go above and beyond the core technology.
12:25pm IT companies growth: TV Mohandas Pai, Chairman, Manipal Universal said the key issues for IT are weakness in euro and pricing contamination.
Adding to the discussion, Sudin Apte, CEO and Research Director, Offshore Insights said client decision making has slowed down over the past couple of months. He believes TCS is better placed to transform itself into new age technology.
According to Pai, management transformation is the key to success for the IT companies now. Execution is a challenge Infosys has to face, he added. He expects the companies to grow in low double digits going forward.
12:00pm Market Check
The market continued to consolidate above 8300 level in noon trade. Metals, select IT and oil stocks gained while banks and select auto stocks remained under pressure.
The Sensex gained 2.64 points at 27493.23 while the Nifty slipped 5.45 points to 8326.50. The BSE Midcap and Smallcap indices outperformed, up 0.4-0.5 percent.
Kotak Mahindra Bank gained 1.7 percent ahead of its Q4 numbers. A CNBC-TV18 poll sees 19 percent profit growth on a standalone basis helped by a low base. Asset quality is expected to be stable. ING Vysya Bank numbers will be merged into Kotak from Q1FY16 onwards.
Metals stocks extended rally with the BSE Metal Index rising more than 2 percent. Vedanta surged over 5 percent and Tata Steel gained more than 4 percent followed by Hindalco with 2 percent upside.
Realty stocks like Oberoi Realty, HDIL etc gained 1-2 percent as the Real Estate Bill is scheduled to be taken up by Rajya Sabha members. Sources suggest that the government may send Real Estate Bill to standing panel today. Also GST Bill is lined up for discussion in Lok Sabha today.
Finance Minister said he is reasonably confident of passage of the GST Bill in the Budget session. He is bullish on the India growth story, saying issues like MAT need to be resolved at the earliest.
11:50 am Result poll: Kotak Mahindra Bank's fourth quarter standalone profit is expected to jump 19.3 percent year-on-year to Rs 485.67 crore, according to a CNBC-TV18 poll. The private sector lender will announce its earnings on Tuesday. The standalone numbers include only core banking operations. Net interest income, the difference between interest earned and interest expended, may grow by 15.2 percent to Rs 1,114 crore for the quarter ended March compared to Rs 966.53 crore in the year-ago period. March quarter earnings did not include ING Vysya Bank numbers as ING merger took place in Q1FY16.
11:30 am Buzzing: Technology stocks are bouncing back on buyers after Cognizant announced its firm March quarter results. What is aiding investor sentiments is Cognizant's confidence in increasing its FY15 revenue guidance. Cognizant results is the first revenue beat for March 2015 by an offsore IT company, after misses across the board from TCS, Infosys, HCL Tech and Wipro
The IT company has hiked its revenue forecast for fiscal 2015 to be up at least 19.3 percent to USD 12.24 billion from its earlier forecast of at least 19 percent growth (USD 12.21 billion) compared to 2014. According to CLSA this may revive investor confidence on 2015 demand health for Indian IT firms after a disappointing March quarter.
This should set the anchor for the upper end of industry growth setting up another year with a wide range of dollar revenue growth 6-13 percent year-on-year. With Wipro and Infosys, stumbling at the exit, broader growth convergence is still over a year away, it says in a report.
The market is gaining strength bit by bit. The Sensex is up 74.99 points at 27565.58 and the Nifty is up 19.75 points at 8351.70. About 1275 shares have advanced, 864 shares declined, and 136 shares are unchanged.
ONGC, Tata Steel, TCS, L&T and Vedanta are top gainers in the Sensex. Cipla, Bharti Airtel, Bajaj Auto, Coal India and HDFC are losers.
Brent crude oil futures slipped towards USD 66 a barrel, falling from a 2015 high, as Saudi Arabia considered halting bombing in Yemen to allow the delivery of aid, which eased concerns about oil supply from the Middle East.
A stronger US dollar also weighed on the dollar-denominated commodity, while investors waited for data on US commercial crude oil inventories later this week for more direction.
Brent crude oil futures slipped by 8 cents to USD 66.37 a barrel by 0215 GMT, after touching a 2015 high of USD 67.10 on Monday.
US crude oil futures fell by 8 cents to USD 58.85 a barrel.
10:25am SKS Microfinance rallies 5%: SKS Microfinance has registered over 49 percent rise in its net profit at Rs 40.54 crore for the last quarter ended March 2015 compared to Rs 27.11 crore in the corresponding last quarter in the previous fiscal. "Total income increased from Rs 147.38 crore for the quarter ended March 31, 2014 to Rs 226.20 crore for the quarter ended March 31, 2015," it said in a filing to the BSE.
For the full fiscal ended March 31, 2015, company's net profit rose by over two-and-a half times to Rs 187.66 crore. It had earned net profit of Rs 69.85 crore in 2013-14. Full year income increased from Rs 544.84 crore for the year ended March 31, 2014 to Rs 803.07 crore for the year ended March 31, 2015, it said.
10:00am Market Check
The market continued to see profit booking amid consolidation. The Sensex fell 37.40 points to 27453.19 and the Nifty declined 15.90 points to 8316.05.
However, the broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising 0.4 percent each. Advancing shares outnumbered declining ones by a ratio of 1052 to 754 on the BSE.
HDFC, ITC, Infosys, Mahindra & Mahindra, Bharti Airtel, Bajaj Auto, Cipla, NTPC and Coal India lost 1-2 percent while Tata Steel topped the buying list on Sensex, up 3.4 percent.
TCS, Larsen & Toubro, ONGC, HUL, Vedanta and Hindalco gained 1-2 percent.
9:50 am Boardroom: Cognizant's quarterly results brought some cheer for the IT sector, still reeling from weak performances by TCS , Infosys and Wipro this quarter. The company topped expectations on the revenue front, raking in over USD 2.9 billion against a company guidance of USD 2.88 billion. Its margins, however, missed the street view. Cognizant chief executive officer Francisco D'souza is confident of delivering margins in the 19-20 percent range on a non-GAAP basis. He says the guidance does not factor in any acquisitions. According to him, Congizant saw very strong demand from clients and saw revenue growing 6 percent quarter-on-quarter. He adds that it would have been higher if not for cross currency headwinds.
9:30 am Poll: Kotak Mahindra Bank 's fourth quarter standalone profit is expected to jump 19.3 percent year-on-year to Rs 485.67 crore, according to a CNBC-TV18 poll. The private sector lender will announce its earnings on Tuesday. The standalone numbers include only core banking operations. Net interest income, the difference between interest earned and interest expended, may grow by 15.2 percent to Rs 1,114 crore for the quarter ended March compared to Rs 966.53 crore in the year-ago period. March quarter earnings did not include ING Vysya Bank numbers as ING merger took place in Q1FY16.
After a stellar rally, the market has opened on a weak note. The Sensex is down 36.13 points at 27454.4 and the Nifty is down 14.35 points at 8317.60. About 424 shares have advanced, 253 shares declined, and 82 shares are unchanged.
TCS, ONGC, Wipro, Sun Pharma and Tata Motors are top gainers in the Sensex. Among the losers are Bajaj Auto, Bharti Airtel, Coal India, ITC and Dr Reddy's Labs.
The Indian rupee has opened lower after a long weekend. The currency fell to 63.54 per dollar, down 12 basis points compared to 63.42 a dollar on Thursday.
Pramit Brahmbhatt, Veracity feels the reduction in FII inflows coupled with profit booking in local equities may pressurise rupee to depreciate. However, gains in Asian equities and some exporters selling may limit losses in the local unit, he adds. He sees the rupee range for today between Rs 63.10-63.80/USD.
The dollar was slightly firm against a basket of major currencies advancing in thin trade.
On the global front trading volumes are light in Asia this morning because Japanese, South Korean and Thailand markets are shut today. While the two Asian markets that are trading today have opened up with a negative bias.
Following positive momentum from Europe, as investors looked to Federal Reserve speeches and economic data for signals on the timing of a rate hike, US stocks closed higher. Moreover, the US 10-year treasury yield gained to trade near 2.14 percent.
Greece is still in focus following further negotiations between the country and its lenders that concluded Sunday. Negotiations made headway and an agreement could be reached this month or in June. Next big get-together for Greece and its lenders is the euro-group meeting of finance ministers on May 11.
Precious metal gold climbed 1 percent yesterday, buoyed by weak Chinese factory data, lifting prices above the prior session's six-week low, though caution over the timing of a US interest rate hike kept prices within a narrow range.