Nifty ends above 8300 for 1st time in 10 months,Sensex up 145 points
01 July 2016
3:30 pm Market closes: The Sensex closes up 145.19 points or 0.5 percent at 27144.91, and the Nifty was up 40.60 points or 0.5 percent at 8328.35. About 1559 shares have advanced, 1157 shares declined, and 139 shares are unchanged. ONGC, BHEL, L&T, GAIL and Dr Reddy's were top gainers while TCS, Coal India, Adani Ports and HDFC were losers.
3:10 pm Gold check: Gold prices rose for the second straight day today, gaining Rs 200 to Rs 30,550 per 10 grams at the bullion market today, driven by a firm global trend and persistent buying by jewellers at the domestic spot market.
Silver too continued its rising streak for the fourth day in a row and reclaimed Rs 44,000 per kg mark by surging Rs 1,300 to Rs 44,600 per kg on increased offtake from industrial units and coin makers.
Analysts said the firming global trend where gold climbed on speculation that central banks would support their economies in the wake of Britain's vote to quit the European Union buoyed sentiment here.
2:59 pm Market Update: Equity benchmarks continued to rally. The Sensex rose 165.92 points or 0.61 percent to 27165.64 and the Nifty gained 49.50 points or 0.60 percent at 8337.25.
2:45 pm RBI on Reliance Defence CDR: Reliance Defence and Engineering has received RBI approval to exit the corporate debt restructuring package.
Anil Ambani-led Reliance Infrastructure has acquired nearly 35 percent in Pipavav Defence and Offshore Engineering Co, which has been renamed as Reliance Defence and Engineering.
Sources said the Reserve Bank of India (RBI) has cleared Reliance Defence exiting the CDR package.
The company's debt to the tune of Rs 6,000 crore will be refinanced with maturity of 20 years while interest cost on the debt would be reduced to 11 percent, sources added.
2:35 pm Oil demand & supply: The global oil market should see supply and demand in balance by 2017 though it will remain structurally well-supplied for the next couple of years, US Energy Secretary Ernest Moniz said today.
Speaking to reporters after meeting with Saudi Arabia's Energy Minister Khalid al-Falih at the G20 energy meeting in Beijing, Moniz said the two men agreed that despite short-term production impacts, oil supply still exceeds demand.
"Unless there are big surprises we are still in a situation of more production than demand. The gap is narrowing as global demand grows slowly," Moniz said.
"His (Falih's) statement is that balance in supply and demand will probably be reached in the end of this year. That's reasonable, but it could also go into next year."
However, when that balance comes, there will still be large supplies due to historically high reserves, he added.
2:20 pm Auto sales: Hinduja Group flagship company Ashok Leyland today reported a 7 percent increase in total sales at 11,108 units in June 2016.
The company had sold 10,429 units in June last year.
Sales for its heavy and medium commercial vehicles rose 8 percent to 8,685 units last month as against 8,016 units in the year-ago period, the company said in a BSE filing.
Light commercial vehicle sales remained flat at 2,423 units compared with 2,413 in June last year.
2:00 pm Market Check
The market maintained its morning rally with the Sensex rising 200 points following upside in global peers.
The 30-share BSE Sensex climbed 202.62 points or 0.75 percent to 27202.34 and the 50-share NSE Nifty rose 59.05 points or 0.71 percent to 8346.80.
The market breadth remained positive as about 1567 shares advanced against 1002 declining shares on Bombay Stock Exchange.
Shriram City was the most active stock on Bombay Stock Exchange after multiple block deals. Mahanagar Gas, L&T, Sun Pharma, ITC, SBI and Axis Bank were other most active shares on exchanges.
European stocks posted slight gains on the first trading day of July, as the recovery in global stocks continued despite uncertainties over the Brexit vote. London's FTSE index saw gains of 0.4 percent, while the French CAC jumped 0.3 percent, while Germany's DAX recovered, up 0.4 percent.
Asia markets finished mostly higher on the first day of the new quarter, tracking global stocks' third day of recovery from the post-Brexit sell-off despite a slew of downbeat data from China and Japan.
1:45 pm FII view: The rally following the outcome of the British referendum may take markets into the expensive zone soon, fears Geoffrey Dennis, Head of Global Emerging Market Strategy at UBS. He believes the current rally is purely a liquidity-driven one.
In an interview to CNBC-TV18, Dennis says India looks a little overpriced, adding, there is risk that India might begin to underperform against emerging markets in the near term as earnings estimates here are on the higher side.
He says, globally, markets have now begun to wonder if the UK will indeed exit EU and it is pretty clear that whatever the decision, negotiations will be prolonged. This is contributing to a rally in risky assets. A favourable settlement could further lift markets into the overvalued zone.
1:30 pm Macro-data: Indian manufacturing activity edged up to a three-month high in June, driven by stronger demand, but firms barely raised prices, a private survey showed, leaving the door open for another rate cut by the central bank this year. The Nikkei/Markit Manufacturing Purchasing Managers' Index (PMI) rose to 51.7 in June from May's 50.7, its sixth month above the 50 mark that separates growth from contraction after it fell below that level in December for the first time in more than two years. Speaking to CNBC-TV18, Samiran Chakraborty, Chief Economist at Citi says that the infrastructure space is slowing down. It is an aberration because of a slow base last year, he said.
The market continues to surge on support from index heavyweights. The Sensex is up 203.84 points or 0.7 percent at 27203.56, and the Nifty up 61.40 points or 0.7 percent at 8349.15. About 1540 shares have advanced, 934 shares declined, and 144 shares are unchanged.
Dr Reddy's Labs, BHEL, L&T, GAIL and Tata Steel are top gainers while Coal India, TCS, Tata Motors and Maruti are losers in the Sensex.
The market is in a global deflationary environment currently, says Taimur Baig of Deutsche Bank AG. Emerging markets (EMs) are in a sweet spot in this volatility.
While the volatility continues in the global markets, EMs have strong growth potential.
Baig does not expect the US Federal Reserve to hike rates anytime soon. Considering the slowing growth momentum in the US, expectations of no hike are legitimate, he says. China, which continues to slowdown, had got sidetracked due to the UK referendum. Debt realization by China will be closely watched.
12:59 pm Market Update: The Sensex gained 209.77 points or 0.78 percent at 27209.49 and the Nifty rose 62.40 points or 0.75 percent to 8350.15.
About 1533 shares advanced against 930 declining shares on Bombay Stock Exchange.
12:50 pm Auto sales: Eicher Motors continued to register strong growth in sales. It sold 4,935 vehicles in June, a growth of 18.5 percent compared with 4,163 units sold in same period last year.
In April-June quarter, company's sales volume increased 32.5 percent to 16,070 units from 12,128 units in year-ago period.
12:40 pm Europe opens: European stocks opened higher on the first trading day of July, as the rally in global stocks continued despite uncertainties over the Brexit vote.
The pan-European STOXX 600 popped 0.5 to 0.6 percent, around Europe's open, while sectors posted modest gains overall.
London's FTSE index saw gains of 0.5 percent around the open, while the domestically-focused FTSE 250 was up 0.5 percent. Meanwhile, the French CAC jumped 0.7 percent at the open, while Germany's DAX ticked up 0.8 percent.
12:35 pm FII view: Baring Private Equity Partners is bullish on Indian markets and says that India's value accretion potential remains good. After two years, the monsoon is looking good which can spur demand and consumption, said Rahul Bhasin, Managing Partner at Baring Private Equity Partners.
Indian pharma companies contribute 6 percent to global pharma sales and Indian pharma companies will gain significant market share in the next 20 years.
He said that global debt has gone up since 2008 and that ensures that money stays easy and opportunities for business to grow will be very good, he told CNBC-TV18.
12:25 pm Interview: Adani Transmission and GMR Energy have entered into an agreement, where the former will acquire 74 percent stake of Maru Transmission Service and 49 percent shares of Aravali Transmission Service of GMR Energy.
Both the assets are in Rajasthan and are operating with an average capacity utilisation of over 99.90 percent.
The deal value for both the projects is Rs 100 crore.
Parag Parikh, CFO at GMR Energy, said that both assets were generating revenues of Rs 72 crore.
He also added that both the projects were adding about Rs 3 crore to the total profit of the company.
Both the assets put together have a debt of Rs 324 crore, said Patil, adding that with the current divestment the debt will be brought down.
12:00 pm Market Check
Equity benchmarks hit fresh 2016 as well as 10-month high, tracking global rally. The broader markets outperformed benchmarks with the BSE Midcap index rising 1.3 percent.
Benchmarks continued upmove for the fifth straight day. The Sensex gained 199.75 points or 0.74 percent at 27199.47 and the Nifty was up 58.95 points or 0.71 percent at 8346.70.
The market breadth remained strong today as well. About two shares advanced for every share declining on the Bombay Stock Exchange.
ITC was the leading contributor to Sensex's gains, up 3 percent as it goes ex-bonus today.
Maruti fell half a percent in an otherwise strong market after it reported a fall of 14 percent in June sales on account of big export weakness.
Mahanagar Gas has a blockbuster listing with gains of over 25 percent at Rs 527.50. The company is confident of maintaining growth of 7-8 percent.
Dr Reddy's Labs gained nearly 3 percent as CNBC-TV18 learns from sources that the remediation of its 3 plants with warning letters is close to completion and will request for a meeting with the USFDA in July itself. Strides Shasun rose 5 percent as the USFDA inspected the company's new oral dosage facility without any observations in Bangalore.
11:45 am Voice on Brexit: Despite global events like Brexit, Indian markets will not see any big headwinds as monsoons have picked up and GST Bill stands a big chance of getting passed and liquidity in the system is much higher, said Mahesh Patil, Co-CIO at Birla Sun Life AMC. Even with the oil and gas space having lesser stock value, he maintained these companies have delivered and have shown improvement in refining margins and volume growth has spiked, too. "The valuations in oil and gas sector remain attractive in high single-digits," he said.
11:30 am Market outlook: Porinju Veliyath, MD & Portfolio Manager at Equity Intelligence India said equity is the best reward in the asset class. Stocks like Biocon and Anant Raj are long-term bets, he said.
"Our investors have never had the confidence to invest in equities," he said, adding that such an attitude should change.
On value picks, he says the consumer business of Tata Group is actually doing well. The change of philosophy in Tata is evident, he says, adding there is pressure in many Tata Group companies to create shareholder wealth.
"The new leadership has taken a position. There is a focus on consolidation, creating an attractive bottom line."
Bulls seems to be charging ahead taking the market higher. Both Sensex and Bank Nifty are at 2016 high. The Sensex is at 27,231.03, up 0.8 percent or 231.31 points while Nifty is at 8352, up 64.60 points or 0.7 percent.
BHEL, Dr Reddy's Labs, ITC and L&T are top gainers while Coal India, Asian Paints, Maruti, Cipla and TCS are losers in the Sensex.
Oil prices rose as traders welcomed assurances from central bank around the world that they were ready to step in to prevent a global rout following Britain's vote to leave the European Union.
Oil market watchers said last week's decline in US commercial inventories is also helping boost prices, but a sustained price rise will only come if producers make meaningful cuts in output.
10:56 am Market Update: The Nifty reclaimed 8350 level in morning trade, rising 64.20 points or 0.77 percent to 8,351.95.
The Sensex rallied 222.03 points or 0.82 percent to 27,221.75, led by ITC, L&T, Axis Bank, Dr Reddy's Labs, HDFC Bank and Infosys.
10:45 am Factory growth: Indian manufacturing activity edged up to a three-month high in June, driven by stronger demand, but firms barely raised prices, a private survey showed, leaving the door open for another rate cut by the central bank this year.
The Nikkei/Markit Manufacturing Purchasing Managers' Index (PMI) rose to 51.7 in June from May's 50.7, its sixth month above the 50 mark that separates growth from contraction after it fell below that level in December for the first time in more than two years.
"The domestic market continues to be the main growth driver, as the Indian economic upturn provides a steady stream of new business," said Pollyanna De Lima, economist at Markit.
10:30 am Auto sales: Maruti Suzuki, the country's largest car manufacturer, has disappointed analysts with its June auto sales data on Friday. The company sold 98,840 vehicles in June, down 13.9 percent compared with 1,14,756 vehicles sold in year-ago period.
Passenger cars and exports hit overall sales growth.
Domestic sales declined 10.2 percent to 92,133 units and exports fell 44.7 percent to 6,707 units on yearly basis.
10:15 am ITC hits 52-week high: ITC shares hit 52-week high of Rs 258.85 intraday Friday, up 5.5 percent after adjusted for issue of bonus shares.
The cigarette-to-hotel-FMCG major has announced bonus shares in the ratio of one share for every two shares held.
10:00 am Market check: Equity benchmarks rallied for the fifth consecutive session today with the Nifty inching towards 8350 level, tracking positive global cues.
The Sensex rose 183.79 points or 0.68 percent to 27183.51 and the Nifty climbed 53 points or 0.64 percent to 8340.75. The broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising 0.8-0.9 percent.
About 1351 shares advanced against 500 declining shares on Bombay Stock Exchange.
Mahanagar Gas jumped 30% to Rs 547.30 against issue price of Rs 421 on debut.
9:55 am Rate cut: Ratings agency Standard and Poor's cut the credit rating for the European Union by one notch saying that the bloc had grown more uncertain after Brexit.
"After the decision by the UK electorate to leave the EU as a consequence of the June 23 consultative referendum, we have reassessed our opinion of cohesion within the EU, which we now consider to be a neutral rather than positive rating factor," the agency said in a statement.
9:45 am PMI: Japanese manufacturing activity shrank in June for the fourth consecutive month, a business survey showed on Friday, as domestic and overseas demand remained stubbornly weak.
The Markit/Nikkei Japan Final Manufacturing Purchasing Managers Index (PMI) edged up to 48.1 in June on a seasonally adjusted basis, versus a preliminary reading of 47.8 and a final reading of 47.7 in May.
But it remained well below the 50 threshold that separates contraction from expansion on a monthly basis, prompting companies to hire fewer workers.
9:30 am FII view: Value in emerging markets (EMs) is looking better than developed markets. In the last two years, return on equities in the developed market has been close to nil, says Jan Dehn of Ashmore Investment Management. While EMs are more attractive, investors are still hesitant to put money into these equity markets, he says. Global economic backdrop looks uncertain and returns from developed markets continue to look bleak. Going forward, EMs are expected to perform better than developed markets. However, flows in EMs will come with a lag, Dehn says. In India, cyclical story will play out. Benign inflation expectations and stable 7th Pay Commission will give Reserve Bank the leeway to ease monetary policy.
The market opened July series on a strong note. The 50-share is up 49.05 points or 0.6 percent at 8336.80 and the Sensex is up 185.87 points or 0.7 percent at 27185.59. About 666 shares have advanced, 148 shares declined, and 41 shares are unchanged.
Dr Reddy's Labs, BHEL, Tata Steel, Wipro and Tata Motors are top gainers while ITC, Bharti Airtel, HUL, Asian Paints and NTPC are losers.
The Indian rupee opened marginally higher at 67.50 per dollar on Friday against previous close of 67.52. Pound is headed for a second weekly drop as traders mull the political fallout from the brexit vote, along with signs the Bank Of England may cut interest rates in the coming months.
Bhaskar Panda of HDFC Bank said, "We expect the USD-INR pair to remain rangebound today. The trading range for the USD-INR is seen between 67.50-67.70/dollar."
Asian stocks rose as global riskier assets continued to recover from last week's Brexit shock, while the pound came under renewed pressure after the Bank of England's governor hinted of an interest rate cut ahead.
MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.2 percent. The index has recovered nearly all the losses suffered last Friday when it plunged in response to Britain's decision to leave the European Union.
The Dow climbed 1.3 percent on Thursday, posting its third straight days of gains and erasing a bulk of its losses after Brexit. Some of the overnight gains on Wall Street were attributed to hopes for more monetary easing after BOE Governor Mark Carney said on Thursday the central bank would probably need to pump more stimulus into Britain's economy over the summer in wake of the Brexit shock.
In other asset classes, Brent crude is trading above USD 50 per barrel. In currencies, pound weakened post dovish comments from Bank of England governor.