Nifty ends F&O expiry higher, loses 1% in September series

After a consolidation in narrow range, the 50-share NSE Nifty closed marginally higher on Thursday, the expiry day for September Futures & Options contract. The broader markets slightly outperformed benchmarks with the BSE Midcap and Smallcap indices rising 0.2 percent and 0.6 percent, respectively. The Nifty rose 22.55 points to 7868.50 and the Sensex gained 40.51 points at 25863.50. The market breadth was positive as about 1444 shares advanced against 1238 shares declined on the Bombay Stock Exchange.

Analysts do not expect the October series to be good, citing current global growth concerns. RBI's monetary policy on September 29 will be key event to watch out for in near term.

Siddharth Bhamre expects the market to be negative in initial part of October series irrespective of RBI lowering rates or maintaining status quo. According to him, resistance range of 8050-8100 is the optimistic scenario if RBI cuts interest rates by 50 basis points.

Suhas Harinarayanan, JM Financial says until the PSU capex picks up, he expects domestic recovery to remain stuck in the 'early to mid-cycle' stage, given that tepid industrial recovery was led by replacement demand in certain sectors and exports until now.

For September series, the Nifty lost 1 percent and the Sensex declined 1.4 percent while for the truncated week, benchmark indices shed 1.4 percent on outflow of foreign money and weak global cues.

The market will remain shut on Friday for Bakri Id holiday.

Global markets were mostly negative today. Nikkei plunged 2.8 percent after Japanese PMI data declined to to 50.9 in September against 51.7 in August, falling for the first time in 3 months. Hang Seng lost 1 percent while China's Shanghai ended 0.9 percent higher. European markets were weak; Germany's DAX was down 2 percent and France's CAC dropped 1.4 percent while Britain's FTSE slipped 0.7 percent. Fed chair Janet Yellen's speech at the University of Massachusetts later today will be keenly watched.

Meanwhile, Prime Minister Narendra Modi reached the New York for his 5-day visit to the US. A meeting with President Barack Obama & UN Secretary General, Ban Ki-moon along with a high profile visit to the Silicon Valley is on the agenda.

Back home, technology and select pharma stocks gained while oil, capital goods and select metals stocks lost ground.

Lupin was the top gainer on Sensex, up 3.55 percent after Nomura and Credit Suisse upgraded stock to outperform on strong product approvals. Credit Suisse raised its target price by 27 percent, citing high upside potential from the company's diabetes drugs.

CNX IT rallied more than 2 percent on depreciation in rupee against dollar. Infosys jumped 2.2 percent while its peers TCS and Wipro gained more than 1.5 percent. HCL Technologies was up 2.75 percent; CLSA has reiterated its buy rating on stock as it believes infrastructure management services (IMS) will drive its near-term growth.

The Indian rupee closed at 66.16 a dollar, down 18 paise compared to 65.98 in previous session.

ITC, HDFC, Maruti Suzuki, Bajaj Auto and GAIL were other prominent gainers, up 1-2 percent. However, ICICI Bank, L&T, Reliance Industries, ONGC, Tata Motors, Bharti Airtel, Coal India and Hindalco Industries plunged 1.5-4 percent.

Tata Steel was down 2.6 percent. Macquarie has slashed FY16-17 earnings per share by 88-55 percent on lower price assumptions and target price to Rs 194.

In the broader space, IDFC gained 2 percent. Chairman Rajiv Lall says IDFC Bank will start operations with 15 percent of its assets classified as stressed and NPA levels of 2-2.25 percent.

3:30 pm Market Closing: Equity benchmarks closed higher on Thursday, the expiry day for September derivative contracts. The Sensex gained 40.51 points at 25863.50 and the Nifty rose 22.55 points to 7868.50. The market breadth was positive as about 1435 shares advanced against 1241 shares declined on the Bombay Stock Exchange.

Lupin topped the buying list on Sensex, up 3.82 percent followed by Infosys, GAIL, ITC, Bajaj Auto, HCL Technologies, Tata Power and IndusInd Bank with 1.8-3 percent.

However, ONGC, Coal India, Tata Motors, Tata Steel, L&T, NMDC and YES Bank were down 2-4 percent.

3:15 pm Buzzing: Shares of Prime Focus rallied 11.5 percent intraday today after Standard Chartered PE increased its stake in the media services powerhouse.

Standard Chartered Private Equity (Mauritus) has purchased 9.75 percent stake in the company through bulk deal today, reports CNBC-TV18 quoting unnamed sources.

The private equity player has raised its stake to 21.98 percent from 12.23 percent stake in the company.

Reliance Mediaworks is biggest public shareholder in the company, holding 44.86 percent stake as of June 2015. Promoters (Naresh Malhotra, Namit Malhotra and Mansoon Studio) have 35 percent shareholding.

3:02 pm Market Update: The Sensex gained 33.60 points at 25856.59 and the Nifty rose 22.60 points to 7868.55. About 1409 shares have advanced, 1177 shares declined, and 132 shares are unchanged on the BSE.

2:55 pm VLCC IPO: Beauty and wellness firm VLCC Health Care has filed draft papers with markets regulator Sebi to raise at least Rs 400 crore through initial public offer (IPO) to fund expansion in domestic as well as international markets.

The IPO comprises fresh issue of shares worth Rs 400 crore and an offer for sale of up to 37.67 lakh equity shares by the existing shareholders -- Indivision India Partners and Leon International.

The company plans to sell up to 18 lakh equity shares for Rs 100 crore through a pre-IPO placement of its shares to institutional investors.

The proceed of the issue would be utilise for setting up VLCC Wellness Centers in India and abroad. Besides, the firm plans to establish VLCC Institutes in the country.

In addition, funds would be used for payment of loans, brand development and general corporate purpose, among others.

2:45 pm Idea in News: Idea Cellular has shifted its 1.5 million pre-paid customers who were on per minute billing (PMB) plan to per second billing (PSB), thus ensuring all its pre-paid users pay only for the time they use the network.

Apart from the 1.5 million, who will be shifted over the next 30 days, the rest of its pre-paid users are already on per second billing.

The company said that out of its total customer base of over 166 million, nearly 157 million are pre-paid.

Bharti Airtel too announced earlier this week that all its pre-paid customers will be put on per second billing.

The move by mobile operators comes amid regulator TRAI's scrutiny whether there are any tariff plans by service providers wherein call drops actually incentivise or benefit the companies.

2:30 pm Buzzing: Poddar Developers gained nearly 3 percent. The company has sold investments in three subsidiaries - Poddar Natural Resources and Ores, Poddar Infrastructure and Poddar Leisure Infrastructure at par today.

All three companies will no longer be subsidiaries of the company w.e.f. September 24, 2015.

2:15 pm NTPC closes bond issue: State-run NTPC has pre-closed its public issue of Rs 700 crore tax-free bonds as it was oversubscribed by 11.04 times on the opening day yesterday.

"In view of oversubscription, the company is pre-closing the public issue of tax free bonds on September 24, 2015," the power major has informed BSE.

"By the end of Day 1 ie by 5.00 PM the issue was oversubscribed by 11.04 times of the base issue size of Rs 400 crore and 6.31 times of the overall issue size of Rs 700 crore," the company had said in a statement yesterday.

The retail portion was oversubscribed by 6.60 times (of the total issue size allocated to retail), reflecting a huge confidence of retail investors in the company, it said.

A total demand of over Rs 4,400 crore was generated against the issue size of Rs 700 crore. NTPC's issue was the first tax-free bond issuance in this fiscal, it said.

2:00 pm Market Check
The marked gained marginal strength amid consolidation in afternoon trade. The Sensex rose 62.68 points to 25885.67 and the Nifty advanced 26.90 points to 7872.85.

Infosys extended rally, up nearly 3 percent while its peers TCS and Wipro gained more than 1 percent.

Lupin surged over 3 3 percent after Nomura and Credit Suisse upgraded stock to an outperform on strong product approvals. Credit Suisse raised its target price by 27 percent, citing high upside potential from the company's diabetes drugs.

ITC, HDFC, Maruti Suzuki, Bajaj Auto and Cipla rose 1-2 percent while L&T, Reliance Industries, ICICI Bank, ONGC, Coal India, Bharti Airtel, Tata Steel, Vedanta and Hindalco were down 1-3 percent.

South Indian Bk (10 percent), Hindustan Zinc (6 percent), Mindtree (4 percent), SAIL (4 percent) and Motherson Sumi (4 percent) were the big winners in the midcap space. Other notable gainers included United Brewerie (2 percent), Gujarat State Petronet (2 percent), Oracle Financial (3 percent), Piramal Enterprises (3 percent) and GSK Consumer (3 percent).

The rupee was quoting at 66.11 to the dollar, down 14 paise over its previous close.

European shares were trading firm with Germany's DAX up 51 points at 9664, France's CAC up 7 points at 4440, and UK's FTSE up 7 points at 6039.

The Sensex and Nifty turned positive in the afternoon trade ahead of Septmebr F&O expiry. The Sensex was up 107.06 points at 25930.05, and the Nifty was up 48.50 points at 7894.45. About 1457 shares have advanced, 1007 shares declined, and 118 shares are unchanged.

Lupin, Infosys, Bajaj Auto, Maruti Suzuki, Tata Power, HCL Tech are the top gainers, while top losers includes Coal India, ONGC, Tata Steel, Larsen, RIL and Vedanta.

1:30 pm BILT in News: Ballarpur Industries said Ballarpur Paper Holdings BV, a step down subsidiary of the company and holding company of SFI (BPH), has signed a share sale agreement with Pandawa Sakti (Sabah) Sdn Bhd, Malaysia for sale of its entire equity stake of 98.08 percent in SFI, at enterprise value of USD 500 million on a cash free debt free basis.

Significant part of consideration is proposed to be used for debt reduction at the level of SFI, Bilt Paper BV and Bilt Graphic Paper Products, said the company.

Completion is expected to take place within 3 months from the date of signing.

1:20 pm Oil gains: Oil prices pared losses today after sharp falls overnight on an unexpectedly large buildup in US gasoline stocks and seasonally tepid demand.

The global benchmark November Brent contract climbed 29 cents to USD 48.04 a barrel, after ending the previous session down USD 1.33 at USD 47.75 a barrel.

US crude rose 33 cents to USD 44.81 a barrel, having slumped USD 1.88 on Wednesday to settle at USD 44.48.

1:00 pm Market Check
The market declined marginally amid consolidation ahead of September F&O expiry. The 30-share BSE Sensex fell 91.10 points to 25731.89 and the 50-share NSE Nifty slipped 18.70 points to 7827.25. The broader markets continued to outperform benchmarks, rising 0.3-0.6 percent.

Asian markets remained mixed. Nikkei dropped almost 3 percent to a 2-week low as the Japanese market reopened after a 3-day break. Shanghai saw marginal gains. In Europe, FTSE and CAC saw marginal losses while DAX gained 0.3 percent.

Bank Nifty remained under pressure trading with a cut of more than half a percent. SBI, HDFC Bank and ICICI Bank slipped 0.5-1 percent.

ONGC, Coal India, Tata Steel and Vedanta plunged 2-3 percent followed by Reliance Industries and L&T with more than 1.5 percent rise.

Lupin topped the buying list on Nifty, up more than 3 percent after Nomura and Credit Suisse upgraded stock to an outperform on strong product approvals. Credit Suisse raised its target price by 27 percent, citing high upside potential from the company's diabetes drugs.

Infosys, Maruti Suzuki, Dr Reddy's Labs, Bajaj Auto and GAIL gained 1-1.5 percent.

Among midcaps, Elder Pharma surged 13 percent as the company will consider selling its overseas arm on Monday. Andrew Yule gained 9 percent as it said the company has 40 percent stake in Tide Water and doesn't see Standard Grease's open offer for tide Water generating much interest.

12:50 pm Rate cut possible?: The Reserve Bank of India is likely to cut interest rates for the fourth time this year at a policy review next week, as falling energy prices have cooled inflation and the economy has slowed, a poll showed.

Several government policymakers and business leaders have advocated a cut in interest rates to boost economic growth, but the central bank's priority is to ensure a sustainable reduction in inflation. Forty-five of 51 economists polled this week predicted the repo rate will be cut by 25 basis points to 7.0 percent, a four-year low, at the policy review on September 29.

A month back, economists gave only a 60 percent chance of it happening.

Since then, consumer inflation sank to a record low of 3.66 percent in August, over two percentage points lower than the central bank's Jan 2016 target, while annual economic growth slowed to 7.0 percent in the quarter ending June.

12:40 pm Europe Update: European stocks opened lower today after an uninspiring lead from Asia and Wall Street, and as investors keep an eye on Volkswagen shares after the resignation of the embattled company's chief executive Wednesday.

London's FTSE 100 was down over 0.3 percent, the German DAX was flat while the French CAC was 0.3 percent lower.

In Asia, shares turned mixed today, with Japan's Nikkei 225 index deepening losses as it played catch-up after being shut for public holidays in the previous sessions. An uninspiring lead from Wall Street overnight amid a persisting slump in commodity prices likely added to the nervousness of traders in Tokyo.

12:20 pm Buzzing: Investors have queued up to buy shares of C & C Constructions on Thursday after it has received big road project in Oman. The stock is locked at 20 percent upper circuit at Rs 13.64 amid high volumes on the Bombay Stock Exchange.

"The company has been awarded a project by Engineering Projects (India), for road and civil works in the Sultanate of Oman," says the Gurgaon-based infrastructure company in its filing.

The contract value of the project is USD 141.28 million, it adds. The order value is quite high compared to its current market capitalisation of Rs 35 crore.

12:00 pm Market Check
The market continued to be volatile ahead of expiry of Nifty September derivative contracts. The Sensex declined 41.44 points to 25781.55 and the Nifty fell 4.35 points to 7841.60.

However, the broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising 0.55 percent and 0.8 percent, respectively. The market breadth was positive as about 1414 shares have advanced against 855 shares declined on the Bombay Stock Exchange.

Coal India (-3 percent), ONGC (-2 percent), Tata Steel (-2 percent) and Vedanta (-2 percent) were the big losers in the Nifty. Other laggards in the index were ICICI Bank (-1 percent), HDFC Bank (-1 percent), Reliance Industries (-1 percent) and Ambuja Cements (-1 percent).

Gainers included Tata Power (4 percent), Lupin (3 percent), Zee Entertain (2 percent) and Tech Mahindra (2 percent).

In sectoral performance as reflected by the respective indices, metals (-1.3 percent), capital goods (-0.9 percent), bank (-0.6 percent) and oil & gas (-0.4 percent) were under pressure, while IT (1.2 percent), consumer durables (1.2 percent), healthcare (1.1 percent) and auto (0.8 percent) gained.

South Indian Bank (10 percent), Hindustan Zinc (5 percent), GSK Consumer (3 percent), Sun TV Network (3 percent) and Piramal Enterprises (3 percent) were big winners in the midcap space. Other notable gainers included Marico (2 percent), Oracle (2 percent), Motherson Sumi (2 percent), Strides Arcolab (3 percent) and Mindtree (3 percent).

The rupee was quoting at 66.08 to the dollar, down 11 paise over its previous close.

11:55 am Volkswagen fiasco: The German automaker Volkswagen admitted to the role it played in rigging the proprietary software in 11 million of its diesel cars in order to pass the emission tests in the US.

Following this, the company's CEO Martin Winterkorn resigned taking responsibility for the German carmaker's rigging of US emissions tests in the biggest scandal.

Guido Reinking, an auto expert told CNBC-TV18 that more than the monetary loss, it will be difficult for the company to rebuild its longstanding "high-quality and loyal brand" reputation.

The European Union and Germany have also brought the company under investigation after the scandal broke out in the US. The names associated with Volkswagen, like its suppliers, will also have to bear the brunt of the scandal all over the world, Reinking said. However, he believes that the Indian suppliers will not be impacted to a great extent.

11:45 am Buzzing: Shares of Strides Arcolab jumped over 3 percent intraday. Jefferies has initiated coverage on the stock with a buy rating and a target price of Rs 1500 per share.

The brokerage sees 320 basis points (bps) margin improvement in the next 3 years. It also adds that backward integration and product mix will aid margin expansion. Meanwhile, Strides Arcolab is also Macquaire's top small cap pick in India's pharma sector with a target price of Rs 1600 per share. Recently, Strides and Sun Pharma have entered into an agreement to acquire Ranbaxy's Solus and Solus Care divisions operating in the central nervous system (CNS) segment in India.

11:30 am Interview: Government-run Andrew Yule , which is the promoter of Tide Water Oil Company (India) Ltd , is confident of fending off a takeover attempt by a minority shareholder (Standard Greases) and ruled out a counter open offer on its part.

In an interview with CNBC-TV18, Andrew Yule CMD K Datta said the company has the support of financial institutions and employee trusts, which own another 14 percent, aside of its own 26 percent in Tide Water Oil. Standard Greases, which owns 25 percent in Tide Water and is also a supplier to the company, has come together with a couple of private-equity funds to come out with an open offer. Tide Water sells the Veedol brand of lubricants in India.

The market is in red on September expiry day with midcaps eeking out a marginal outperformance. The Sensex is down 85.50 points or 0.3 percent at 25737.49 and the Nifty slips 16.55 points or 0.2 percent at 7829.40. About 1279 shares have advanced, 779 shares declined, and 81 shares are unchanged.

Lupin, Infosys, Maruti, Cipla and Bajaj Auto are top gainers while ONGC, Coal India, Tata Steel, L&T and Vedanta are major losers in the Sensex.

Manoj Murlidharan of Religare Securities expects the Nifty to hover near 7886 level at the expiry. He has the stop loss for Nifty at 7764 level. For Bank Nifty, Murlidharan's call option is 17300 with a sell call at 17500 level.

Asian shares traded mixed, with Japan's Nikkei 225 index lagging behind its regional peers after returning from a three-day national holiday earlier in the week.

10:55 am Market outlook: The recent Nifty lows of 7,500 look like a reasonable bottom and all domestic negatives are priced in at that price, UR Bhat of Dalton Capital says.

"The joker in the pack is China but I hope it will be able to handle its economy well," he told CNBC-TV18.

India is in the early stage of an economic recovery, Bhat said, adding that he was bullish on the pharmaceutical sector, which could lead up the next bull rally.

10:45 am Interview: The second quarter could be relatively better than the first quarter in terms of demand because gold prices in the month of June helped push sales is the word coming in from S Subramaniam, CFO, Titan Company.

He is also hopeful of a pick-up in demand from the upcoming festival season which is likely to begin in next 15-20 days.

In spite of walk-ins being a challenge for the industry, the company will go ahead with its store expansion plans because of its belief in the long-term Indian growth story, says Subramaniam, "We will continue to invest in network expansion,' he adds.

Although softer real estate prices have helped them reach breakeven earlier for their new stores, the company has more franchise stores, so the benefit may not flow directly for them always. However, it does help them get more franchisees.

10:30 am Buzzing: Shares of Oberoi Realty rose over 3 percent intraday. Bank of America Merrill Lynch has maintained a buy rating with a target of Rs 335 per share.

The brokerage expects multiple triggers for Oberoi over next three-four quarters. It says that the real estate developer is eyeing launches in the upcoming period. Launch at Borivali is during an auspicious period in October-November while Mulund phase II is expected to launch soon as approvals are already received. Oberoi Realty is likely to launch Worli in Q4FY16 and Goregaon as early as H1FY17. "The market isn't valuing all upcoming launches & additional FSI," it says.

The market is sluggish on September F&O expiry day. The Sensex is down 81.52 points or 0.3 percent at 25741.47 and the Nifty slips 18.90 points or 0.2 percent at 7827.05. About 970 shares have advanced, 661 shares declined, and 74 shares are unchanged.

Lupin, Maruti, Dr Reddy's Labs, M&M and Bajaj Auto are top gainers while ONGC, Reliance, L&T, Coal India and Vedanta are major losers.

Oil prices edged up on Thursday after taking a hit in the previous session in response to a mixed US stockpiles report, but analysts warned that headwinds remained in place for the under-pressure commodity.

Concerns about a slowdown in the global economy, particularly key energy consumer China, combined with an oversupply have seen crude prices tumble more than 60 percent from last year's peaks above USD 100 a barrel.

Prices took another hit yesterday when the US Department of Energy (DoE) said output at home rose 19,000 barrels per day to 9.136 million, snapping a six-week run of lower production.

9:55 am: State-run Rural Electrification Corp inked two separate agreements with Andhra Pradesh utilities to provide Rs 9,000 crore loan for 500-MW solar power plant and transmission network for state's capital.

The MoUs to provide debt to the utilities were signed in the presence of Andhra Pradesh Chief Minister N Chandrababu Naidu. The first MoU with APGENCO (Andhra Pradesh Power Generation Corporation Limited) is for Rs 3,000 crore for setting up a 500 MW Solar power generation project in Anantpur during the 12th Five Year Plan (2012-17) Period. 9:45 am Oil Update: Oil prices edged up today after taking a hit in the previous session in response to a mixed US stockpiles report, but analysts warned that headwinds remained in place for the under-pressure commodity.

Concerns about a slowdown in the global economy, particularly key energy consumer China, combined with an oversupply have seen crude prices tumble more than 60 percent from last year's peaks above USD 100 a barrel.

Prices took another hit yesterday when the US Department of Energy (DoE) said output at home rose 19,000 barrels per day to 9.136 million, snapping a six-week run of lower production.

The news came hours after it was announced that a gauge of factory activity in China had hit a six-and-a-half-year low in September - overshadowing figures showing US commercial crude inventories sank 1.9 million barrels in the week ending September 18. Both main contracts edged up in electronic trade today.

US benchmark West Texas Intermediate was 0.90 percent higher at USD 44.88 a barrel, while Brent crude added 0.67 percent to USD 48.07.

9:30 am Market outlook: Suhas Harinarayanan, JM Financial says until the PSU capex picks up, he expects domestic recovery to remain stuck in the 'early to mid-cycle' stage, given that tepid industrial recovery was led by replacement demand in certain sectors and exports until now."

Based on capex study, he continues to favour retail focused companies and only a few select capex themes in India.

He likes smaller contractors like Ashoka Buildcon & Sadbhav Engineering. In power T&D, he likes Techno Electric and in midcap cement, he likes JK Lakshmi Cement.

The market has opened weak on September F&O expiry day. The Sensex is down 71.40 points or 0.3 percent at 25751.59 and the Nifty slips 10.45 points or 0.1 percent at 7835.50. About 267 shares have advanced, 160 shares declined, and 29 shares are unchanged.

Lupin, NTPC, Sun Pharma, Bajaj Auto and HUL are top gainers while ICICI Bank, HDFC, Axis Bank and Tata Steel are major losers in the Sensex.

The Indian rupee has extended its fall in early trade on weakness in global equities. The currency has opened at 66.20 a dollar, down 23 paise or 0.34 percent compared to 65.97 a dollar in previous session.

Mohan Shenoi, Kotak Mahindra Bank says Federal Reserve not hiking rates initially triggered global risk-on rally. But likely Fed lift-off in December, weak China PMI and Volkswagen crisis has reversed sentiment back to risk-off, he adds.

According to him, safe-haven buying has helped the dollar rally. The rupee has been resilient with RBI presence on both sides, he feels.

Meanwhile, Asian shares got off to a cautious start after more dour economic news in China and the United States prompted a bruising selloff the previous day.

Worries that an eventual tightening in US monetary policy and slower growth in China could knock the global economy have scared off investors, particularly those invested in stocks and commodities. Japan's Nikkei average, opening for the first time since Friday after national holidays, tumbled 1.6 percent, edging near its seven-month low touched earlier this year.

Wall Street also lost ground on Wednesday, dragged down by economic reports portraying US factory growth as tepid and China in its worst manufacturing contraction since the global financial crisis.