Sensex dives 551 points, Nifty ends at 8361; metals crash
27 July 2015
03:30 pm Market closing: Spooked by SIT investigation on P-Notes and weak China, the market ended with severe losses. The Sensex slumped 550.93 points or 1.9 percent at 27561.38 while the Nifty slipped 160.55 points or 1.9 poercent at 8361.00. About 1083 shares have advanced, 1741 shares declined, and 142 shares are unchanged.
Tata Steel and Hero fell 5 percent while Hindalco, Axis Bank and ONGC were other laggards. Bajaj Auto gained 1 percent.
03:20 pm Poll: Maruti's earnings are expected to be strong for another quarter led by good volume growth and margin expansion, feel analysts. Profit after tax is likely to jump 69 percent year-on-year to Rs 1,287 crore and revenue is seen rising 18 percent to Rs 13,455 crore, according to the average of estimates of analysts polled by CNBC-TV18. The company will announce its earnings on July 28.
The country's largest car maker sold 3.41 lakh units in June quarter, a growth of 13.8 percent over 2.99 lakh units sold in in the year-ago period. Domestic sales volumes grew by 13 percent and exports surged by 21.8 percent during the same period.
New offerings like Ciaz, Celerio and Alto ATM did very well in the quarter and Celerio sales crossed the 1 lakh unit mark.
03:00 pm Drug sale: AstraZeneca, under pressure from falling sales of older drugs, is selling a medicine for a rare type of cancer to Sanofi as it continues a drive to raise cash by divesting certain assets.
Sanofi's rare diseases division Genzyme will pay AstraZeneca up to USD 300 million for global rights to Caprelsa, including an upfront payment of USD 165 million and milestone payments based on the drug's performance of up to USD 135 million, the companies said on Monday.
Caprelsa is sold in 28 countries for treating medullary thyroid carcinoma and had sales last year of USD 48 million.
02:45 pm Market Update: Equity benchmarks extended losses in last hour of trade. The Sensex crashed 500.32 points or 1.78 percent to 27611.99 and the Nifty plunged 146.65 points or 1.72 percent to 8374.90.
About 1046 shares have advanced, 1678 shares declined, and 136 shares are unchanged on the BSE.
02:35 pm Aurobindo in News: Aurobindo Pharma has received final approvals from the US Food & Drug Administration (USFDA) to manufacture and market Esmolol hydrochloride injection, 100mg/10mL (10mg/mL).
Esmolol hydrochloride injection, 100mg/10mL (10mg/mL) is bioequivalent and therapeutically equivalent to the reference listed drug product (RLD) Brevibloc injection, 10mg/mL of Baxter Healthcare Corporation.
Esmolol Hydrochloride Injection is indicated for the short-term treatment of tachycardia and hypertension that occur during induction and tracheal intubation, during surgery, on emergence from anesthesia and in the postoperative period.
Aurobindo now has 13 ANDAs (represented by 10 product classes) approved out of Unit IV formulation facility in Hyderabad, India for manufacturing general injectable products and will be marketed and sold by Aurobindo's wholly owned subsidiary AuroMedics Pharma LLC.
02:20 pm Jaitley on P-Note woes: To soothe nerves of jittery foreign investors after an SIT on black money suggested stricter norms for P-notes, the Government today said it will not take any "knee-jerk" reaction that will adversely impact country's investment climate.
With markets tanking on the recommendations of the Supreme Court-appointed SIT on black money last week that Sebi should tighten norms related to Participatory notes (P-notes) investments into India, Finance Minister Arun Jaitley said the government will study the suggestions before taking a stand.
"It is too early to say what view the government would take. But the it will certainly not take any such action in a knee-jerk reaction, particularly one which has any adverse impact on investment environment," he told reporters in his Parliament House Office.
"No such step would be taken which could adversely impact investment sentiment in the country," Jaitley said.
Jaitley said the suggestions and recommendations made by the SIT on black money will come up to the government and "the government will apply its mind in due course keeping in mind the investment environment of the country as also the objective behind the SIT recommendations and then take a final view on the matter."
02:00 pm Market Check
Equity benchmarks continued to see selling pressure, heading towards weak closing for the third consecutive session. The Sensex plunged 429.37 points or 1.53 percent to 27682.94 and the Nifty fell 123.60 points or 1.45 percent to 8397.95 as China's crash and P-Note concerns weighed.
Global markets tumbled today with the shanghai closing down more than 8 percent on the back of growth worries as industrial profits declined 0.3 percent Y-o-Y in June. Hang Seng lost more than 750 points while in commodities, oil prices fell further on oversupply worries.
The rupee slipped to 6-week low against the dollar at 64.06 as traders avoided taking large positions ahead of Fed Reserve meeting later this week. Most of asian currencies are trading lower.
Shares of ICICI Bank, L&T, Axis Bank, Tata Motors, Bharti Airtel, ONGC, Bharti Airtel, Tata Steel, Hindalco, Hero Motocorp and Vedanta plunged 2.5-5 percent.
1:45 pm FPC: The Government's 5 percent stake sale on Monday in power sector lender PFC got fully subscribed with strong demand coming in from institutional investors.
However, retail demand was tepid with the portion reserved for them getting subscribed 43 percent so far.
PFC is the second PSU to be divested in the current fiscal under the government's disinvestment programme.
In April, Government had sold 5 percent stake in REC for Rs 1,550 crore.
1:30 pm FM on P-Notes: To soothe nerves of jittery foreign investors after an SIT on black money suggested stricter norms for P-Notes, the Government today said it will not take any "knee-jerk" reaction that will will adversely impact country's investment climate. With markets tanking on the recommendations of the Supreme Court-appointed SIT on black money last week that Sebi should tighten norms related to Participatory Notes (P-Notes) investments into India, Finance Minister Arun Jaitley said the government will study the suggestions before taking a stand.
The market is drifting away under severe pressures mostly from infra, metals and auto. The Sensex is down 420.53 points or 1.5 percent at 27691.78, and the Nifty is down 124.35 points or 1.5 percent at 8397.20. About 983 shares have advanced, 1567 shares declined, and 134 shares are unchanged.
Tata Steel, Tata Motors, Hindalco, Bharti Airtel and Hero Motocorp are laggards while Bajaj Auto, NTPC and Cipla are top gainers in the Sensex.
China stocks plunged more than 8 percent, their biggest one-day drop in more than eight years, as a government-triggered rebound petered out amid profit-taking, concerns over economic health and fears of an end to Beijing's inclination toward looser monetary policies.The CSI300 index of the largest listed companies in Shanghai and Shenzhen fell 8.6 percent, to 3,818.73, while the Shanghai Composite Index lost 8.5 percent, to 3,725.56 points.
The drops were the biggest since Feb. 27, 2007.
In the Asian market, China is the main problem with low demand and weaker industrial production, Richard Gibbs of Plantagenet Investments told CNBC-TV18.
"China is the genesis of the problems and that is impacting the US and also commodity prices," he said.
Gibbs said that in Indian context, there are still worries over capital flow investments due to various risk. There is uncertainty over regulatory policies as well, he said. Despite weak earnings, Gibbs believes that sectors in Indian market that enjoyed foreign inflows will do well this year.
12:55 pm Nifty breaks 8400: Equity benchmarks extended losses with the Sensex crashing 401.29 points or 1.43 percent to 27711.02 and the Nifty falling 126.55 points or 1.49 percent to 8395.
About 1005 shares have advanced, 1531 shares declined, and 131 shares are unchanged on the BSE.
12:50 pm FII View: According to Hartmut Issel (Head - Equity & Credit APAC, UBS), weak data out of China was the main dampener for global markets but the house continues to be positive on global equities and is overweight on European markets & Japan.
Within emerging markets, he was still overweight on India and Taiwan. However, the house has cut the weightage on India a bit, he said.
When asked if he saw global investors worried over the P-Note issue by SIT in India, he said international investors need not be worried as long as they were investing through legitimate sources.
With regards to weakness in US market, he thinks it is more of a micro issue related to corporate earnings than a macro one.
12:45 pm Market Update: The Sensex extended fall in afternoon trade, down 406.73 points or 1.45 percent to 27705.58. The Nifty plunged 117.25 points or 1.38 percent to 8404.30.
About 1024 shares have advanced, 1503 shares declined, and 133 shares are unchanged on the BSE.
12:40 pm Europe opens: European stock markets opened lower after a sell-off in Asian shares, as traders await the opening of a key meeting of the US Federal Reserve's rate-setting committee.
The UK's benchmark FTSE opened flat, while Germany's DAX and France's CAC both opened 0.5 percent lower.
12:30 pm Asia Update: Asian stocks sold off today, mirroring the declines offshore and as the fall in commodity prices continues to sap risk appetite. Meanwhile, caution ahead of the Federal Reserve's two-day policy meeting also kept investors on the sideline.
The China's Shanghai Composite index plunged 8.5 percent to close at 3,725.56, the biggest intraday fall today since 2007. The index rose more than 17 percent since July 8 crash.
12:20 pm Market Expert: In the monsoon session of Parliament, all investor eyes are on the Goods & Services Tax (GST) Bill, Dipan Mehta, member of BSE and NSE said. The eventual outcome will be revealed only at the end of this session, he added.
On the p-notes issue, Mehta said that the government will try bringing in reforms and transparency in the p-notes issue.
12:00 pm Market Check
The market remained under selling pressure in noon trade with the Nifty below 8,450, dented by SIT recommendations on P-Notes and weak global cues.
The 30-share BSE Sensex plunged 302.04 points or 1.07 percent to 27810.27 and the 50-share NSE Nifty fell 87 points or 1.02 percent to 8434.55. The BSE Midcap and Smallcap indices dropped half a percent.
Revenue secretary Shaktikanta Das told CNBC-TV18 that there is no reason for market to react adversely or panic yet. He said the government will study the special investigative team's recommendations on black money and take a considered decision.
Ridham Desai of Morgan Stanley said it is premature to react to SIT recommendations on P-Notes and is confident that government will make a studied decision on the issue. He remains bullish on India, saying long-term sentiment remains intact.
Asian markets saw a sharp sell-off as investors took a cautious stance ahead of this week's Fed meeting. Shanghai plunged 5.5 percent, Hang Seng lost 3 percent and Nikkei slipped 1 percent. Also the fall in commodity prices continued with Brent crude below USD 55 a barrel.
Tech Mahindra gained nearly 2 percent ahead of Q1 earnings. The software company is likely to see a growth of 27 percent in Q1 net profit at Rs 600 crore from Rs 472 crore in quarter-ago period, according to a CNBC-TV18 poll.
11:45 am Update: Hinduja Group-promoted IndusInd Bank said it has completed acquisition of Royal Bank of Scotland's diamond and jewellery financing business in the country.
"IndusInd Bank has completed the acquisition with the entire business portfolio migrating to the bank. The acquired loan book is approximately Rs 41 billion (Rs 4,100 crore," IndusInd Bank said in a BSE filing.
In April this year, IndusInd Bank said it has entered into an agreement with Royal Bank of Scotland to acquire the latter's diamond and jewellery financing business in the country for an undisclosed sum.
11:30 am Result: Geometric's first quarter net profit grew by whopping 480 percent or 5.8 times sequentially to Rs 19.12 crore, led by other income, engineering services business and operational performance.
Revenue increased by 11 percent quarter-on-quarter to Rs 297.5 crore and dollar revenue jumped 9 percent to USD 46.8 million in the quarter ended June.
"This quarter, we saw volume growth in both software services and engineering services. We have also taken several steps to streamline operations, which should lead to an improvement in margins," said Manu Parpia, Managing Director & CEO.
The market is still under pressure as the Nifty struggles to hold 8450. The 50-share index is down 75.75 points or 0.8 percent at 8445.80. The Sensex is down 262.80 points or 0.9 percent at 27849.51. About 982 shares have advanced, 1240 shares declined, and 115 shares are unchanged.
Tata Motors, Tata Steel, ONGC, Hindalco and Axis Bank are major losers while NTPC, M&M, Cipla, Wipro and Lupin are among top gainers in the Sensex.
Investors are spooked by the SIT recommendation to go after P-Notes to stem. However, Ridham Desai, managing director at Morgan Stanley says black money is unlikely to impact market. He is confident that the government will make a studied decision on the issue and rules out the possibility of the FII community panicking over P note issue.
Oil prices fell further in Asia on Monday, hurt by a slump in the manufacturing sector in China, the world's top energy consuming nation.
A strong dollar and signs of increasing US oil production added pressure on oil prices, which have already been depressed by a global crude oversupply, analysts said.
10:45 am Rajesh Exports in News: Rajesh Exports bought Valcambi, the world's largest gold refining company, in an all-cash deal worth USD 400 million.
The company was selected after a global search by Valcambi's existing owners led by Newmont Mining Corp, the world's largest gold jewellery maker said.
The deal will help it secure raw material supplies and will add to earnings per share, the company said.
India is the world's biggest consumer of gold, with annual demand hovering around 900 tonnes per year.
10:25 am Earnings Poll: Ambuja Cements' second quarter is expected to be subdued as profit after tax is seen falling 37 percent year-on-year to Rs 258 crore on poor realisation and lower revenue, according to the average of estimates of analysts polled by CNBC-TV18.
Total income from operations is likely to fall 8 percent to Rs 2,490 crore in June quarter compared to Rs 2,720.1 crore in the year-ago period due to lower sales volumes.
The company follows January-December as its financial year. Analysts expect cement volumes to inch up very marginally by 1 percent to 5.85 million tonnes from 5.79 million tonnes during the same period as Pan India demand has been very weak.
Degrowth on year-on-year basis may be due to eroding market shares in the last two years. Realisations may take a sharp knock in June quarter due to Northern and Western presence. West is the key market for Ambuja cements while Ambuja has no presence in South.
10:10 am FII View on P-Notes woes: The SIT recommendation to go after P Notes to stem black money is unlikely to impact market, says Ridham Desai of Morgan Stanley.
He is confident that the government will make a studied decision on the issue and rules out the possibility of the FII community panicking over P-Note issue.
Desai, on the other hand, is worried that if GST Bill does not get passed during the Monsoon Session of parliament, it may hurt sentiment. But that is "short-term" glitch in the 3-5 year bull run, he says.
10:00 am Market Check
The market extended losses in morning trade with the Sensex falling 318.40 points or 1.13 percent to 27793.91 and the Nifty declining 87.95 points or 1.03 percent to 8433.60.
The broader markets, too, slipped into red. The BSE Midcap index dropped 1 percent and Smallcap declined 0.8 percent. About 760 shares have advanced, 1111 shares declined, and 102 shares are unchanged on the BSE.
Bank Nifty fell 300 points.
9:55 am Why P-Notes are scary? Udayan Mukherjee of CNBC-TV18 says the P-Note scare had affected market in the past. The government should come out with a clarification, to quell the panic, that that going after P Notes will not destabilise markets.
He said the market is extremely sensitive to the word P Note and the government should tread very carefully. Udayan Mukherjee says many entitites trading through P Notes are not keen to identify themselves. 'So the government has justification in seeking identification of P Note owners," he said.
Talking of the market, he said the Nifty had a good run with a good amount of domestic liquidity. A large part of the works were part of India-China relative trade. But that sheen has come off and is favouring China because of poor earnings, impending Bihar elections, deadlock over GST and now the P-Note may push the market down.
9:48 am Market check: The market continues its downward journey. The Sensex is down 254.91 points or 0.9 percent at 27857.40, and the Nifty is down 77.80 points or 0.91% at 8443.75. About 766 shares have advanced, 976 shares declined, and 95 shares are unchanged.
Tata Motors, ICICI Bank, GAIL, Tata Steel and L&T are among laggards. Cipla and NTPC are up on the Sensex.
9:30 am Buzzing: Shares of Relaxo Footwear rose 8 percent after it posted strong April-June quarter earnings. Its Q1FY16 net profit surged 56 percent to Rs 36 crore from Rs 23 crore in corresponding quarter last fiscal. During the quarter, revenues also increased 21.3 percent at Rs 454 crore against Rs 374 crore on an annual basis as higher realisations pushed revenues.
Gross margins expanded substantially (510 basis points at 59.3 perent Y-o-Y) over fall in raw material costs. Raw material costs fell 3.3 percent at Rs 153 crore in the first quarter of current fiscal.
The footwear manufacturer's EBITDA was up 42.7 percent at Rs 69 crore in June quarter compared to Rs 48 crore (Y-o-Y) while EBITDA margins stood at 15.2 percent versus 12.9 percent.
The market has opened on lower note as traders seem to be cautious of the Participatory Notes (P-Notes)issue. The Sensex is down 161.11 points or 0.6 percent at 27951.20 and the Nifty is down 49.45 points or 0.6 percent at 8472.10. About 469 shares have advanced, 442 shares declined, and 91 shares are unchanged.
Concerned over flow of black money into stock market, the Supreme Court-appointed SIT has asked regulator Sebi to compulsorily identify real owners of foreign funds coming through the controversial P-Note route and also prosecute those using equities for tax evasion.
P-Notes are typically Offshore Derivative Instruments issued abroad by Foreign Institutional Investors (FIIs) or their associates against the underlying Indian securities.
ICICI Bank, Tata Motors, L&T, Tata Steel and GAIL are among major losers while Lupin, HUL, Cipla, NTPC and Dr Reddy's Labs are major gainers in the Sensex.
The Indian rupee opened with marginal loss of 3 paise at 64.07 per dollar against previous close of 64.04.
On Friday, rupee ended at lowest closing level since June 17.
Agam Gupta of Standarad Chartered said," Expect the USD-INR to open around 64.10/dollar. Dollar buyers should emerge on dips towards 63.80-63.85/dollar. Exporters are seen to have decent selling interest in any run-up towards 64.20-64.25 levels."
The dollar was subdued against the euro and yen after a drop in US market and bond yields dimmed its allure, with markets focused on whether the upcoming Federal Reserve policy meeting can lift the greenback.
Meanwhile, global cues are negative as the Asian markets start the week on a weak note as the fall in commodity prices continues to sap risk appetite. China's Shanghai index slumped more than 2 percent from the get-go, as the country's industrial profits declined 0.3 percent year-on-year in June, according to data.
Both US and European markets closed the past week in red.
Precious metal is again losing its sheen with gold currently trading below USD 1100 dollars an ounce.
Crude prices declined after Baker Hughes data showed an increase in US oil rigs. Brent crude too fell to USD 54 per barrel.