Nifty ends below 8000, Sensex tanks 249 points; BHEL down
05 November 2015
Total clean energy supply from eight of the world's 10 largest greenhouse gas emitters - Brazil, China, the European Union, India, Indonesia, Japan, Mexico and the United States - will jump to 20,000 terawatt hours (TWh) from around 9,000 TWh in 2009.
That is equivalent to India's current energy demand.
2:20 pm Tata Steel down 2%: Tata Steel , one of the country's largest steel companies, is expected to report dismal performance in July-September quarter earnings. Consolidated profit may fall 32.2 percent year-on-year to Rs 851 crore from Rs 1,254 crore, according to analysts polled by CNBC-TV18.
Degrowth in bottomline is because of high base in year-ago period. In Q2FY15, profit included income on sale of non current assets amounting to Rs 1,146 crore (sale of a land at Borivali, Mumbai).
Consolidated revenue is seen down 17.3 percent to Rs 29,600 crore in quarter ended September 2015 compared to Rs 35,777 crore in year-ago period.
2:00 pm Market Check
Equity benchmarks continued to see selling pressure amid volatility, weighed down by banking & financials, healthcare, technology and oil stocks.
The Sensex declined 137.44 points to 26415.48 and the Nifty fell 49.65 points to 7990.55. The BSE Midcap dropped 0.8 percent and Smallcap declined 1 percent.
Even market breadth breadth was weak as about 1,636 shares declined for 899 advancing shares on the BSE.
Coal India topped buying list on Sensex, up 2 percent followed by Mahindra & Mahindra with 1 percent gain ahead of Q2 earnings tomorrow.
Reliance Industries, Sun Pharma, TCS, ICICI Bank, Axis Bank, Bharti Airtel, SBI and Vedanta dropped 1-4 percent.
JPMorgan and Morgan Stanley have been engaged by DLF and its promoters. It is a two tranche deal. The promoters of the company will first resolve the compulsory convertible preference shares and sell that to private equities and sovereign funds and then infuse that money into DLF.
1:30 pm Gold scheme: Prime Minister Narendra Modi launched three gold related schemes- Gold Monetisation Scheme (GMS), Gold Sovereign Bond Scheme and the Gold Coin and Bullion Scheme. Speaking on the occasion, Modi said India has surpassed China as the world's largest gold consumer, buying 562 tonnes of yellow metal so far this year, against China's 548 tonnes.
"People should take advantage of the golden opportunity to help India march to a golden period," he said.
The market is still down as the Sensex slips 81.39 points or 0.3 percent at 26471.53. The Nifty falls 32 points or 0.4 percent at 8008.20. About 910 shares have advanced, 1563 shares declined, and 119 shares are unchanged.
Coal India, NTPC, Hero MotoCorp, HUL and ITC are top gainers while Vedanta, Tata Steel, Bharti Airtel and Sun Pharma are among losers in the Sensex.
Sixty percent of earnings are in-line or mildly better than expectation, says Mahesh Patil of Birla Sun Life AMC. Going ahead, earnings in the second half of FY16 is likely to be better than the first half, he told CNBC-TV18. As far as the second quarter numbers are concerned, he says margin expansion has been the biggest positive in this earnings season.
Additionally, he does not see Bihar election outcome impacting the markets much. However, if there is any correction in the market post Bihar polls, investors should use it as a buying opportunity.
12:59 pm Market Update: Equity benchmarks remained under pressure. The Sensex declined 94.66 points to 26458.26 and the Nifty fell 38 points to 8002.20. About 886 shares have advanced, 1537 shares declined, and 98 shares are unchanged on the BSE.
12:50 pm Earnings: Pharma company Novartis India reported a multi-fold jump in its standalone net profit at Rs 103.82 crore for the September quarter on back of slump sale of its OTC division to GlaxoSmithKline Plc.
The company had posted a net profit of Rs 14 crore a year ago. "The company has received a sale consideration in relation to the slump sale of the OTC division to GSK CPL amounting to Rs 1,097.3 million and the same has been accounted for in the quarter ended September 30, 2015 results," Novartis said in a note.
The company's board in January had approved a slump sale of OTC business to GSK Consumer Private Limited . In April, Novartis had agreed to divest its global Animal Health business to Lilly by transferring it to Elanco India or another affiliate of Lilly.
12:35 pm Gold scheme: Prime Minister Narendra Modi today launched three gold related schemes- Gold Monetisation Scheme (GMS), Gold Sovereign Bond Scheme and the Gold Coin and Bullion Scheme.
PM Modi also unveiled the first ever national gold coin minted in India with the national emblem of Ashok Chakra engraved to be released among others on the occasion.
Speaking at the event PM Modi said the question of physical gold's security will now be ruled out and women will benefit the most from these schemes.
12:15 pm Interview: Industrial paint company Kansai Nerolac 's second quarter net-profit rose 33 percent to Rs 96.8 crore this year. Speaking to CNBC-TV18, HM Bharuka, MD of Kansai Nerolac says the company has registered an 11 percent volume growth during the quarter.
He is of the view that a delay in Diwali, compared to the last year, will lead to better performance in the third quarter versus that of the second.
Bharuka adds that 53 percent of the company's revenues come from its decorative segment.
12:00 pm Market Check
The market continued to consolidate for the fourth consecutive session despite positive Asian cues. The Sensex declined 50.69 points to 26502.23 and the Nifty fell 18.85 points to 8021.35.
The broader markets were also under pressure as the BSE Midcap and Smallcap indices slipped around half a percent. The market breadth was weak too as about 1413 shares declined against 866 advancing shares on the BSE.
Tata Steel lost 2 percent ahead of earnings. Consolidated profit may fall 32.2 percent year-on-year to Rs 851 crore from Rs 1,254 crore, according to a CNBC-TV18 poll.
Sun Pharma, Vedanta, Axis Bank and Bharti Airtel were other top losers on Sensex, down 1.5-2.5 percent. Infosys, ITC, Maruti, L&T, Tata Motors, Hero Motocorp, HUL, Coal India and NTPC gained 0.4-1.5 percent.
11:55 am Result poll: Pharma company Cipla is expected to report robust earnings for July-September quarter, driven by export formulation business. Profit is likely to surge 74.4 percent year-on-year to Rs 520.9 crore, aided by operational performance. It will announce its earnings on November 5. Revenue is seen rising 28.7 percent to Rs 3,562.7 crore in quarter ended September 2015 compared to Rs 2,767.3 crore in year-ago period.
Nexium (used to treat certain stomach and esophagus problem) & Pulmicort (used to prevent asthma attacks) supply may boost company's export formulation business during the quarter. Hence, export formulation business may grow around 35-40 percent year-on-year.
11:45 am market outlook: About 35 of 50 Nifty companies have reported results so far representing 75 percent of market cap. Headline sales are down 5 percent and profit after tax is up 3 percent and hence the weakness continues, but adjusted for sectors seeing acute deflation like metals and oil, sales/profit after tax grew 9 percent and 8 percent year-on-year, in line with Q1 trends, says Neelkanth Mishra, Credit Suisse.
11:30 am World view: With Federal Reserve chair Janet Yellen saying that December would be a "live possibility" for a rate hike if the upcoming data are supportive, emerging market currencies can see downward pressure, says Xavier Denis, global strategist, Societe Generale Securities. However, equities in the region on the other hand will react more to earnings, which has not been too bright, he says. According to him, the outlook for equities is mixed. In the near-term though, he says equities in EM can see additional upside in the coming weeks, but a lot will deoend on data coming out of China.
The market continues to reel under pressure, as the the Sensex is down 130.83 points or 0.5 percent at 26422.09, and the Nifty down 45.40 points or 0.6 percent at 7994.80. About 751 shares have advanced, 1388 shares declined, and 91 shares are unchanged.
Hero MotoCorp, Coal India, NTPC, HUL and Maruti are top gainers while Bharti Airtel, Tata Steel, Vedanta, Sun Pharma and Axis Bank are losers in the Sensex.
Gold held near a one-month low and looked likely to drop below the USD 1,100-an-ounce level after Federal Reserve Chair Janet Yellen bolstered market expectations for a US interest rate hike in December.
Yellen pointed to a possible December interest rate lift-off and laid out what now appears the base case at the US central bank - that low unemployment, continued growth and faith in a coming return of inflation means the country is ready for higher interest rates. Other Fed officials also voiced similar opinions, sending non-interest-paying bullion lower for a sixth straight session on Wednesday.
10:40 am FII View: About 35 of 50 Nifty companies have reported results so far representing 75 percent of market cap. Headline sales are down 5 percent and profit after tax is up 3 percent and hence the weakness continues, but adjusted for sectors seeing acute deflation like metals and oil, sales/profit after tax grew 9 percent and 8 percent year-on-year, in line with Q1 trends, says Neelkanth Mishra, Credit Suisse.
He further says Credit Suisse analysts have cut FY16/17 Nifty EPS estimates by 0.6-2 percent, adding cuts were broad-based, only energy and telecom have seen upgrades.
The most aggressive cuts were in metals and healthcare, he says.
10:20 am Boardroom: Pune-based Bank of Maharashtra reported weak Q2 numbers with its net profit falling 55.8 percent at Rs 72.03 crore versus Rs 162.91 crore on a year-on-year basis.
The bank's gross non-performing assets (NPAs) rose to 5.4 percent at Rs 7986.34 crore versus Rs 7574.86 crore on a quarter-on-quarter basis.
Speaking to CNBC-TV18, RK Gupta, Executive Director, Bank of Maharashtra, says the poor asset quality comes on the back of a drought in the state.
However, the bank is combating the stressed assets and will work towards improving cash recovery. Gupta further adds the bank's gross NPAs by FY16-end should be at 7 percent.
10:00 am Market Check
The market is slipping away as the Nifty struggles to hold 8000. The 50-share index is down 34.60 points or 0.4 percent at 8005.60. The Sensex is down 106.80 points or 0.4 percent at 26446.12. About 729 shares have advanced, 1052 shares declined, and 67 shares are unchanged.
Tata Motors, NTPC, Hero, Coal India and HUL are top gainers while Vedanta, Tata Steel, Axis Bank, Sun Pharma and Bharti Airtel are down.
World oil prices sank, erasing earlier gains as traders reacted to news of a sixth weekly gain in US crude inventories, adding to the global supply glut. The US government's Department of Energy reported Wednesday that American commercial crude stockpiles climbed 2.8 million barrels in the week to October 30.
A global economic slowdown led by top energy guzzler China has led to demand not keeping pace with the crude supply glut which is expected to persist well into next year.
9:55 am The Reserve Bank has issued operational guidelines for Sovereign Gold Bonds, 2015-16, to be launched by Prime Minister Narendra Modi today. Besides Sovereign Gold Bonds, Modi will also launch two other gold related schemes -- Gold Monetisation Scheme (GMS) and the Gold Coin and Bullion Scheme. Issuing the operational guidelines on the gold bonds, RBI said application forms from investors will be received at branches during normal banking hours from November 5 to 20.
"Relevant additional details may be obtained from the applicants, where necessary. Receiving offices need to ensure that the application is complete in all respects," it said. Regarding interest on application money, RBI said applicants will be paid interest at prevailing savings bank rate from the date of realisation of payment to the settlement date (the period for which they are out of funds).
9:45 am Result poll: Tata Steel , one of the country's largest steel companies, is expected to report dismal performance in July-September quarter earnings. Consolidated profit may fall 32.2 percent year-on-year to Rs 851 crore from Rs 1,254 crore, according to analysts polled by CNBC-TV18. Earnings will be announced on November 5. Degrowth in bottomline is because of high base in year-ago period. In Q2FY15, profit included income on sale of non current assets amounting to Rs 1,146 crore (sale of a land at Borivali, Mumbai).
9:30 am Fund raising: The board of IDBI Bank passed an enabling resolution to allow it to raise Rs 2800 crore via a qualified institutional placement (QIP) or any other instrument like follow-on public offer. But this does not follow from recent talks that the government was looking to sell direct stake in the firm, and would hold it indirectly via other public companies, as it does in Axis Bank, a move that has allowed the latter to operate like a private sector bank. In an interview to CNBC-TV18, IDBI Deputy MD BK Batra said he had not heard from government on any planned reduction of its stake.
The market has opened marginally lower on Thursday. The Sensex fell 75.74 points to 26477.18 and the Nifty declined 20.40 points or 0.25% at 8019.80.
Bharti Airtel, Lupin, Vedanta, ONGC, Sun Pharma and UltraTech Cement declined nearly a percent. NTPC, GAIL, Infosys, Hindalco, BHEL, Tata Power and Asian Paints were early gainers.
The Indian rupee slipped 12 paise in the early trade today. It has opened at 65.60 per dollar versus 65.48 Wednesday.
Mohan Shenoi of Kotak Mahindra Bank said, "After Janet Yellen's testimony to Congress yesterday, the odds of a December Fed rate hike has increased substantially. This coupled with the fact that there could be further monetary easing by ECB in December has triggered dollar strength against all major currencies."
"Expect the rupee to weaken today and is trade in a range of 65.60-65.85/dollar," he added.
On global front, the dollar was at three-month highs against a basket of major currencies following a jump in US treasury yields as Fed officials indicate that a December "lift-off" in US rates is a distinct possibility.
US stocks closed lower after Federal Reserve chairman Janet Yellen reinforced the fact that a December rate hike is a live possibility.
Nasdaq listed IT major Cognizant delivered once again with a dollar revenue growth of 3.3 percent beating expectations. The company has raised its full-year growth guidance to a whopping 21 percent.
Closer home, Asian stocks traded mostly lower in early trade today, following a weak Wall Street finish as increasing odds of a US interest-rate rise in December sapped risk appetite.