Sensex, Nifty end flat; Tata Steel & Sun Pharma gainers
25 January 2016
3:30 pm Market closing: After a good rally, the market ended flat. The Sensex was up 50.29 points or 0.2 percent at 24485.95 and the Nifty was up 13.70 points or 0.2 percent at 7436.15. About 1734 shares advanced, 929 shares declined, and 157 shares were unchanged.
Tata Steel, Sun Pharma, ICICI Bank, Coal India and ONGC were top gainers while Hero MotoCorp, L&T, GAIL, Tata Motors and Adani Ports were losers in the Sensex.
2:58 pm Market Update: Equity benchmarks continued to be volatile in afternoon trade. The Sensex rose 46.23 points to 24481.89 and the Nifty went up 13.60 points to 7436.05.
About 1669 shares have advanced, 920 shares declined, and 154 shares are unchanged on the BSE.
2:40 pm Interview: Nearly half of the revenue growth has come from recent acquisitions, says Anand Deshpande, Founder, MD & CEO, Persistent Systems , adding there was extra contribution from the Aepona acquisition.
At the same time, margins are under pressure because of the acquisitions, Deshpande tells CNBC-TV18.
He expects the current quarter to be better than the December quarter, and is optimistic about the deal pipeline.
He says the third quarter saw a volume growth of 1.9 percent and a price growth of 1.1 percent.
2:20 pm Earnings: HDFC Bank's third quarter earnings matched analysts' expectations on Monday. Profit increased 20 percent year-on-year to Rs 3,357 crore during the quarter, supported by operating profit, net interest income and other income. Net interest income, the difference between interest earned and interest expended, climbed 24 percent to Rs 7,068.51 crore in Q3 compared to Rs 5,700 crore in year-ago period.
Profit was estimated at Rs 3,350 crore (20 percent growth) and net interest income at Rs 6,911 crore (21.3 percent growth) for the quarter, according to analysts polled by CNBC-TV18.
Other income (non-interest income) during the quarter grew by 13.3 percent to Rs 2,872.2 crore and operating profit surged 20 percent to Rs 5,735.9 crore compared to same quarter last fiscal.
2:00 pm Market Check
Equity benchmarks as well as broader markets trimmed gains following correction in European peers and crude oil prices. The Sensex rose 17.59 points to 24453.25 and the Nifty gained 7.45 points at 7429.90.
The BSE Midcap and Smallcap indices climbed 0.4 percent and 1 percent, respectively. The market breadth remained positive as more than two shares advanced for every share declining on the BSE against 5:1 in morning.
L&T, Axis Bank, Hero Motocorp, GAIL and NTPC were down 1-3 percent followed by Infosys, ITC.
1:55 pm Stock view: Shares of ITC slipped over 1 percent intraday after it announced December quarter results. Analysts are not bearish on the stock but have tweaked target and earnings estimates. ITC's key product tobacco-based items mainly cigarettes sales volume saw a moderate decline in Q3 FY16 to 4.5 percent after four quarters of double digit declines. ITC's cigarette sales volume has fallen over 20 percent in the last three years due to steep increases in taxation and subsequent price hikes.
Jefferies has maintained buy rating on ITC but lowered FY16-18 earnings per share (EPS) estimates by 3 percent and target price to Rs 381 per share mainly to account for higher tax rates. It says near-term earnings are likely to be weak but believes we are nearing the bottom of the weak demand cycle.
1:45 pm Poll: Non-banking finance company SKS Microfinance is expected to continue to report solid set of earnings for third quarter. Profit is likely to jump 96.3 percent during the quarter to Rs 80.6 crore and net interest income is seen rising 89 percent to Rs 161 crore compared to year-ago period, according to analysts polled by CNBC-TV18. Earnings will be announced on January 27.
In Q2, profit rose 37 percent and NII jumped 51.4 percent year-on-year following 46 percent NII growth and 24 percent profit growth in Q1.
After Q2 earnings, the company raised its profit guidance for FY16 to Rs 290 crore against Rs 235 crore earlier. In 1HFY16, profit stood at Rs 139 crore.
1:30 pm FII view: Market sentiment is a little better now, but there is still a sense of caution in global markets, says David Mann of Standard Chartered. The European Central Bank's president, Mario Draghi on Thursday said that the bank might step up its stimulus as early as March on the back of low inflation and volatility in financial markets. Speaking to CNBC-TV18, Mann says that monetary easing by major central banks will help lift global sentiments. Europe, he says, is more likely to see further easing than the Bank of Japan. The key is the tone of the Federal Reserve, Mann says adding that it will stimulate markets if it is dovish.
The market is firm as the Nifty holds 7450 comfortably. The 50-share index is up 31.45 points or 0.4 percent at 7453.90. The Sensex is up 113.55 points or 0.5 percent at 24549.21. About 1794 shares have advanced, 640 shares declined, and 128 shares are unchanged.
Tata Steel, Sun Pharma, ICICI Bank, Coal India and HDFC are top gainers while Hero MotoCorp, Axis Bank, L&T and Wipro are losers in the Sensex.
Oil prices extended their rally in Asia buoyed by hopes of extra stimulus measures in the eurozone and Japan that could help boost demand in the face of a global supply glut.
On Thursday European Central Bank chief Mario Draghi signalled further stimulus measures for the region, while a report in the respected Nikkei business daily Friday said the Bank of Japan is also considering extra measures. "The demand side of the situation was what was worrying us.
12:58 pm Market Update: Equity benchmarks remained positive, though it lost some gains from day's high. The Sensex rose 112.80 points or 0.46 percent to 24548.46 and the Nifty advanced 32.85 points or 0.44 percent to 7455.30.
About three shares advanced for every share declining on the Bombay Stock Exchange.
Long build-up was seen in Cairn India, Bata India and Jubilant Foodworks. These stocks rallied 5 percent each in cash market. Cairn's open interest increased 6.5 percent followed by Jubilant Foodworks 5 percent and Bata India 4 percent.
12:40 pm Interview: Force Motors reported a nearly three-fold jump in net profit at Rs 27.44 crore for the third quarter ended December 2015, compared with Rs 10 crore Year-on-Year (YoY). Prasan Firodia, MD, Force Motors, expects to see revenue growth of 25 percent by FY16-end. He also expects the company to grow 25-30 percent in FY17. Firodia says margins will come in at 8-10 percent in FY17.
He also says the company is growing at a steady rate in the van segment, while the traveller product has seen 21 percent growth in the nine months of FY16.
12:20 pm Market Outlook: Nandan Chakraborty, Axis Capital says India is less susceptible to global pain points as Indian growth recovery would gain traction in 2016.
According to him, midcaps are at risk as they usually do well when GDP growth surprises and/or when the broader market has run-up and pauses to catch its breath and midcaps catch up. However, both the conditions are not in place and hence midcaps remain vulnerable, he feels.
Chakraborty says importantly, once FII flows stabilise/return, large caps with better risk-reward will be back in favour.
12:00 pm Market Check: Equity benchmarks continued to see buying interest led by banking & financials, pharma, oil and auto stocks. The broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising more than a percent.
The 30-share BSE Sensex climbed 135.57 points to 24571.23 and the 50-share NSE Nifty rose 39.85 points to 7462.30. The market breadth remained positive as more than three shares advanced for every share declining on the Bombay Stock Exchange.
SpiceJet, InterGlobe Aviation, Force Motors, Jet Airways, Axis Bank, ICICI Bank and SBI were most active shares on exchanges.
Crude oil futures extended gains following a surge at the end of last week on short-covering and fuel demand triggered by freezing weather in parts of the northern hemisphere. Oil prices soared 10 percent on Friday, one of the biggest daily rallies ever, as bearish traders who had taken out record short positions scrambled to close them, betting the market's long rout may finally be over. Brent crude today rose 1.7 percent to USD 32.7 a barrel.
11:50 am Given that the Indian market has corrected so much, this is definitely a relief rally, says Nischal Maheshwari, head institutional equities at Edelweiss Securities. "We have hit a bottom for now, but I am not sure if markets have made a medium-term bottom," he told CNBC-TV18. He feels Nifty can find a floor at around 6700-7000 level. As far as earnings growth is concerned, Maheshwari expects it to be around 12-14 percent in FY17. He also adds that South East Asia is seeing a lot of redemption pressure, but India is in a much better position, he says.
11:30 am FII view: Given the current market scenario, a bottom is definitely difficult to assess, is the word coming in from Pramod Gubbi of Ambit. He, however, says the market is relatively more attractive now. He advises investors to have a bottom up approach. He is positive on Indian equities from a long-term perspective 2-3 years time horizon. On the ongoing earnings season, he says it is as per expectation. He had expected earnings downgrades and sees a few more of them in the banking sector. He feels the banking sector is likely to remain weak for a while.
The market is gaining strength with from banks and pharma stocks. The Sensex is up 155.81 points or 0.6 percent at 24591.47 and the Nifty is up 43.35 points or 0.6 percent at 7465.80. About 1730 shares have advanced, 423 shares declined, and 93 shares are unchanged.
Sun Pharma, HDFC, Tata Steel, TCS and ICICI Bank are top gainers while Hero MotoCorp, Axis Bank, L&T, Bharti and ITC are laggards in the Sensex.
Gold steadied near a 1-1.5 week peak at just below USD 1,100 an ounce early on Monday, with investors eyeing whether equities will come under renewed pressure and refresh safe-haven demand for bullion. The precious metal had benefitted from investor aversion towards risky assets that has hit global stocks and crude oil. It peaked at USD 1,109.20 last week, its loftiest since January 8.
10:58 am Market Update: Equity benchmarks continued to hold early gains. The 30-share BSE Sensex surged 182.69 points or 0.75 percent to 24618.35 and the 50-share NSE Nifty rose 51.80 points or 0.70 percent to 7474.25.
More than four shares advanced for every share declining on the Bombay Stock Exchange.
In F&O, Wockhardt added 5 percent in open interest and has seen long build-up. Adani Power's open interest declined 7 percent and saw short covering.
MRF added 4 percent in open interest and has seen long build-up. UCO Bank has seen short build-up and its January Futures added 2.9 lakh shares in OI.
10:40 am Mahindra Airbus JV: Taking forward the memorandum of understanding signed in July, Mahindra Defence and Airbus Helicopters inked a pact to form a joint venture to produce military helicopters in India.
The statement of intent was signed on Sunday by representatives of both companies in the presence of Prime Minister Narendra Modi and French President Francois Hollande.
"We have made significant progress in setting up the joint venture and together the companies are creating a world-class advanced helicopter production facility in India," Mahindra and Mahindra Group President for Aerospace and Defence S P Shukla said in statement.
10:20 am Earnings Poll: HDFC Bank , the country's second largest private sector lender, is expected to continue to report stable earnings for October-December quarter. Profit is seen rising 20 percent for the 10th consecutive quarter, to Rs 3,350 crore in Q3 compared to Rs 2,794 crore year-ago period, according to analysts polled by CNBC-TV18. Net interest income, the difference between interest earned and interest expended, may increase 21.3 percent to Rs 6,911 crore from Rs 5,700 crore on annual basis. Analysts expect fee income to grow 15-20 percent, aiding profitability. Fee income was 70 percent of other income and was up 21 percent in Q2 year-on-year.
10:00 am Market Check
The market remained strong in morning trade with the Sensex rising 173.87 points or 0.71 percent to 24609.53 and the Nifty up 52.90 points or 0.71 percent to 7475.35, tracking positive global cues.
The broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices up 1-1.5 percent. The market breadth continued to be strong as more than five shares advanced for every share declining on the Bombay Stock Exchange.
Asian markets also gained with Shanghai and Hang Seng up 1-1.8 percent, tracking a 2-2.7 percent rally on Wall Street on Friday. Crude oil prices extended gains after surge on short covering. Brent crude rose 0.7 percent to USD 32.40 a barrel.
HDFC, Reliance Industries, HDFC Bank, ICICI Bank, TCS, Sun Pharma, Tata Motors and ONGC were leading contributors to Sensex's gains, up 1-2 percent while Axis Bank and Bharti Airtel fell more than 1 percent.
9:55 am IMF on China: Financial markets need more clarity on how Chinese authorities are managing their currency, particularly the relationship of the yuan to the US dollar, IMF Managing Director Christine Lagarde said. Sharp swings in the yuan have contributed, along with a dramatic fall in the price of oil, to global market volatility since the beginning of 2016.
Bank of Japan Governor Haruhiko Kuroda, speaking on the same panel at the World Economic Forum in Davos, said he believed China should use capital controls to stabilise its currency while keeping domestic monetary policy loose.
9:45 am Moody's on India: India's GDP could grow 6.5-7.5 percent over the next 12-18 months, according to over three quarters of the market participants polled by rating agency Moody's last week. Market participants are increasingly concerned about the potential spillover of external risks, such as interest rate tightening in the US and China's ongoing slowdown, on India's growth story, the Moody's poll. "35 percent saw external shocks as the greatest challenge facing India's economy, up from just 10 percent in our previous poll in May 2015. However, this is more likely a reflection of the broad-based spike in global risk aversion rather than India's relative vulnerabilities," said the Moody's release.
9:30 am FII view: Market sentiment is a little better now, but there is still a sense of caution in global markets, says David Mann of Standard Chartered. The European Central Bank's president, Mario Draghi said that the bank might step up its stimulus as early as March on the back of low inflation and volatility in financial markets. Speaking to CNBC-TV18, Mann says that monetary easing by major central banks will help lift global sentiments. Europe, he says, is more likely to see further easing than the Bank of Japan. The key is the tone of the Federal Reserve, Mann says adding that it will stimulate markets if it is dovish.
The market has opened higher on Monday. The Sensex is up 157.91 points or 0.6 percent at 24593.57 and the Nifty is up 46.10 points or 0.6 percent at 7468.55. About 870 shares have advanced, 130 shares declined, and 35 shares are unchanged.
SBI, M&M, ICICI Bank, ONGC and Tata Steel are top gainers while Bharti Airtel, Wipro, ITC and HUL are losers in the Sensex.
The Indian rupee opened higher by 9 paise at 67.54 per dollar against 67.63 Friday.
Agam Gupta of Standard Chartered said, "We should see a range of 67.45-67.80/dollar today. I expect stronger demand for USD to emerge below 67.50 levels. Exporters will look for the upticks to hedge their dollar receivables."
"Market participants will continue to keep an eye on equity and oil moves through the day," he added. Dollar is firm, boosted by increased expectations of monetary easing by Central Banks in Europe and Japan, and by strong US housing data.
Asian stocks gained in early trade, relieved after seeing Wall Street rally overnight on the back of a sharp rise in crude oil prices.
Global equities were also boosted last week as the European Central Bank signaled additional monetary easing steps to come, and focus fell on the Federal Reserve and Bank of Japan meetings this week. From the Fed, investors will look for any hints of when a second interest rate hike would come, while speculation mounted last week toward the BOJ implementing additional easing measures.