Nifty ends below 8550, Sensex flat; Reliance, TCS, ONGC gainers
19 July 2016
3:30 pm Market closing: The market has ended flat with the Nifty below 8250. The 50-share index ended up 19.85 points or 0.2 percent at 8528.55 and the Sensex was up 40.96 points at 27787.62. About 1223 shares have advanced, 1446 shares declined, and 169 shares are unchanged.
ICICI Bank, Lupin, Reliance, TCS and ONGC were top gainers while HUL, HDFC Bank, Coal India, Axis Bank and Hero were losers in the Sensex.
3:10 pm Earnings Estimates: Software services exporter Wipro's first quarter (April-June) IT services revenue may grow 2.28 percent sequentially to USD 1,925 million and rupee revenue may increase 1.1 percent to Rs 12,940 crore, according to average of estimates of analysts polled by CNBC-TV18.
Analysts say growth may be boosted by full quarter integration of Healthplan acquisition and currency tailwinds. According to them, Healthplan can contribute around 200 basis points to topline.
They expect constant currency revenue growth of around 1.7-2 percent for the quarter, which is within the company's guidance of 1-3 percent at USD 1,901-1,939 million.
Wipro may guide for 1.5–3.5 percent growth for Q2FY17, which may be included acquisition of Vitoes.
2:59 pm Market Update: Equity benchmarks rebounded amid consolidation. The Sensex was up 10.43 points at 27757.09 and the Nifty rose 7.80 points to 8516.50.
Oil marketing companies surged in late trade with the BPCL, HPCL and IOC rising 3-4 percent.
2:50 pm Ricoh's loss: Ricoh India continues to be in troubled water as probe indicates that the company's accounts have been falsified.
According to preliminary findings of PricewaterhouseCoppers (PWC), the "company's financial statements of June and September quarter 2015 did not reflect a true and fair view of the state of affairs and the company is investigating extent of deviations and also reason for it."
In a statement to the exchanges, Ricoh said that it appears that the accounts have been flasified and its accounting principles and standards have been violated. "Such acts of omission and commission have caused a grave loss to the company and its shareholders."
As per its estimates, Ricoh India had an unaudited estimate of aggregate loss after tax would be Rs 1123 crore.
2:40 pm Earnings: UltraTech Cement's first quarter (April-June) profit and operational numbers beat analysts' expectations but revenue was a miss. Profit on standalone basis jumped sharply by 26.2 percent to Rs 757.6 crore compared with year-ago period, driven by strong operational income and higher other income despite sharp jump in tax cost.
Revenue increased 3.8 percent to Rs 6,232.5 crore in the quarter ended June 2016 compared with Rs 6,007 crore in corresponding period of last fiscal.
During the quarter, sales volume was up by 6.4 percent to 13.20 million tonne from 12.41 million tonne while blended sales increased by 3 percent YoY, which was lower than analysts' estimates of at least 5 percent.
Profit was estimated at Rs 740 crore on revenue of Rs 6,429 crore for the quarter, according to average of estimates of analysts polled by CNBC-TV18.
2:20 pm Banks' loan disbursement under MUDRA: Banks are expected to disburse Rs 1.80 lakh crore as loan under Micro Units Development and Refinance Agency Yojna during the current fiscal, MUDRA CEO Jiji Mammen said today.
"We started our operation from April 2015. The total target for the year 2015-16 was Rs 1.22 lakh crore, against which by the end of the year Rs 1.33 lakh crore was disbursed by all the banks and MFIs. It exceeded the target.
"In 2016-17, the government has set a target of Rs 1.80 lakh crore to be disbursed under the MUDRA. So far during the first quarter, the banks have disbursed Rs 25,000 crore," Mammen told reporters here.
He said of the total loans disbursed, banks contributed Rs 87,000 crore while MFIs' contribution was Rs 46,000 crore. Under the Pradhan Mantri Mudra Yojana (PMMY), loans ranging from Rs 50,000 to Rs 10 lakh are provided to small entrepreneurs.
2:00 pm Market Check
Equity benchmarks were marginally lower amid consolidation in afternoon trade with the Nifty struggling below the 8500 level, weighed down by FMCG, infra and HDFC group stocks.
The 30-share BSE Sensex was down 49.03 points to 27697.63 and the 50-share NSE Nifty declined 13.85 points to 8494.85. The market breadth also turned lower as about 1486 shares declined against 1069 advancing shares on the Bombay Stock Exchange.
European stocks traded lower as investors trod carefully amid a drop in oil prices and ongoing geopolitical tensions, despite US markets closing at all-time highs on Monday. France's CAC, Germany's DAX and Britain's FTSE were down 0.3-1 percent.
Oil prices eased as concerns over a crude and refined fuel glut outweighed an expected cut in US shale production and a probable further draw in US crude inventories. Brent and US crude futures were down 0.4 percent each.
1:45 pm Market view: The market is placed at a position where there is a 50:50 chance that Nifty can swing both ways, according to Sanjay Sinha, Founder, Citrus Advisors. Nifty could touch 9,000 or fall to 8,000 levels again, he said.
Earnings performance of IT and banks sector will have to be closely observed to get a sense of Nifty performance, Sinha said. "If we don't have shockers in the June quarter results then I think the possibility of the market now breaking that 8,600 barrier is quite likely," he said, adding that the passage of GST Bill will only add tailwinds to the rally.
1:30 pm Result: UltraTech Cement's first quarter (April-June) profit and operational numbers beat analysts' expectations but revenue was a miss. Profit on standalone basis jumped sharply by 26.2 percent to Rs 757.6 crore compared with year-ago period, driven by strong operational income.
Revenue increased 3.8 percent to Rs 6,232.5 crore in the quarter ended June 2016 compared with Rs 6,007 crore in corresponding period of last fiscal.
Operating profit (earnings before interest, tax, depreciation and amortisation) grew by 23.4 percent year-on-year to Rs 1,422 crore and margin expanded by 362 basis points to 22.82 percent in quarter gone by.
The market is flat with the Nifty hovering around 8500. The 50-share index is up 4.20 points at 8512.90 and the Sensex is up 0.18 points at 27746.84. About 1199 shares have advanced, 1248 shares declined, and 154 shares are unchanged.
ICICI Bank, SBI, Lupin, Sun Pharma and ONGC are top gainers while HUL, M&M, Hero and HDFC twins are losers in the Sensex.
Shares of state-run banks gained 1-4 percent intraday after government provided recapitalisation fund to 13 PSU banks that have high non-performing loans and stressed assets.
The government has allotted Rs 22,915 crore in the first tranche of bank recapitalisation. "Consequent upon the capital infusion exercise for the current year, 75 percent of the amount collected for each bank is being released now to provide liquidity support for lending operations as also to enable banks to raise funds from the market," says the government in its release.
Gold prices were up by Rs 35 to Rs 31,050 per 10 grams in futures trade today as speculators raised their bets amid firm global trend.
The yellow metal for delivery in October gained Rs 33 or 0.11 percent to Rs 31,450 per 10 gm in 7 lots.
Market analysts attributed rise in gold prices at futures trade to positive global cues. Meanwhile, gold was trading higher 0.09 percent at USD 1,329.70 an ounce in Singapore.
12:50 pm Europe Update: European stocks traded lower as investors trod carefully amid a drop in oil prices and ongoing geopolitical tensions, despite U.S. markets closing at all-time highs on Monday.
The pan-European STOXX 600 was down 0.47 percent.
12:40 pm PSU banks rally: Shares of state-run banks gained 1-4 percent intraday after the government provided recapitalisation fund to 13 PSU banks that have high non-performing loans and stressed assets.
The government has alloted Rs 22,915 crore in the first tranche of bank recapitalisation.
"Consequent upon the capital infusion exercise for the current year, 75 percent of the amount collected for each bank is being released now to provide liquidity support for lending operations as also to enable banks to raise funds from the market," says the government in its release.
12:20 pm Market Expert: Last few weeks have seen ETF inflows worth USD 3.5 billion into emerging markets. India's weightage in the ETF flows is at about 9-11 percent and in fact, last week saw inflows worth USD 60 million, said Anish Damania of IDFC Securities.
"We are seeing traction from FIIs. There is net selling taking place on domestic side but that is for profit booking," he said.
Since the Budget, the market has delivered 20 percent returns on Nifty and the brokerage holds a target of 8900 for March 2017, he said.
The brokerage will make further calls on Nifty target after how how first and second quarters pan out, he added.
12:00 pm Market Check
The market remained in a consolidation mode with the Nifty hovering around 8500 level as investors are closely watching first quarter earnings season and Monsoon Session of Parliament.
The 30-share BSE Sensex was down 20.42 points at 27726.24 and the 50-share NSE Nifty fell 1 point to 8507.70.
Infosys, ICICI Bank, Tata Motors, Mindtree and Vedanta were top five most active shares on the National Stock Exchange.
Asian markets were mostly lower today with the Hong Kong's Hang Seng and China's Shanghai falling 0.6 percent each. Japan's benchmark Nikkei 225 beat its regional peers to trade up 1.4 percent, with stocks receiving a boost from a relatively weaker yen, after the market was closed on Monday for a public holiday.
11:55 am Call on telcos: Telecom stocks have been under pressure lately as industry majors Bharti Airtel and Idea announced a major price cut for their data plans, ahead of Reliance Jio's launch on August 15.
But even as a price cut could eat into realisations of telecom companies, one noted telecom analyst thinks it will more than make up for it by way of gains in reveneus.
"I think the mobile internet revenue pie can expand significantly. Only a small number of users in India -- high teens in percentage terms -- use data today. That number will go up significantly," said UBS' Suresh Mahadevan, pointing out that with 4G phones now starting to cost Rs 3,000 at the lowest price point means that the "data pie will expand manifold".
11:30 am Result poll: Software services exporter Wipro's first quarter (April-June) IT services revenue may grow 2.28 percent sequentially to USD 1,925 million and rupee revenue may increase 1.1 percent to Rs 12,940 crore, according to average of estimates of analysts polled by CNBC-TV18. Analysts say growth may be boosted by full quarter integration of Healthplan acquisition and currency tailwinds. According to them, Healthplan can contribute around 200 basis points to topline. They expect constant currency revenue growth of around 1.7-2 percent for the quarter, which is within the company's guidance of 1-3 percent at USD 1,901-1,939 million.
The market is rangebound with FMCG stocks under pressure. The Sensex is up 16.31 points at 27762.97, and the Nifty is up 6.35 points at 8515.05. About 1222 shares have advanced, 978 shares declined, and 124 shares are unchanged.
ICICI Bank, Tata Motors, GAIL, Tata Steel and Sun Pharma are gainers while HUL, Hero, ITC, HDFC Bank and M&M are losers in the Sensex.
Turkey is a strategic conduit for shipments from Russia and Iraq to the Mediterranean and there had been fears that the bid to grab power by a military faction at the weekend would disrupt flows.
The coup, however, was quickly crushed. After topping USD 50 in early June on the back of unrest in key African producer Nigeria and wildfires in Canada's key crude region, prices have been falling as the crises eased.
10:45 am Oil weak: Oil prices eased as concerns over a crude and refined fuel glut outweighed an expected cut in US shale production and a probable further draw in US crude inventories.
The market is waiting for US crude stocks data on Tuesday and Wednesday to help give direction to prices.
10:30 am Citi initiates buy on Crompton Consumer: Citi has initiated coverage on Crompton Greaves Consumer Electrical with a buy rating and target price of Rs 174, citing growth prospects and return on equity (RoE).
The brokerage house expects a 13 percent sales compounded annual growth rate (CAGR) and 74 basis points operating profit margin expansion in FY16-19.
It feels refinancing/repayment of debt should rapidly lower interest costs and in part drive a 25 percent EPS CAGR in FY17E-19, leading to sector-high RoEs of around 50 percent.
Crompton Greaves Consumer Electricals is top player in fans, domestic lighting and pumps in India.
10:15 am Morgan Stanley on Bharti: With underweight rating and target price of Rs 294/share on Bharti Airtel, Morgan Stanley says share price may fall relative to index over next 60 days.
According to the brokerage, first quarter earnings will be moderate for domestic operations but Africa may disappoint.
The stock fell 4 percent in previous session, especially after Idea Cellular slashed data rates.
10:00 am Market Check
Equity benchmarks as well as broader markets continued to consolidate for the second consecutive session today, especially after a 2.6 percent rally in previous week.
The 30-share BSE Sensex declined 37.63 points to 27709.03 and the 50-share NSE Nifty fell 9.65 points to 8499.05.
With real sovereign yields high in Asia and emerging markets (EM), there is room for equity outperformance, says Sean Darby of Jefferies. He remains overweight on EMs and is mildly bullish on India.
Tata Motors was the leading gainer, up 1.4 percent followed by TCS, Sun Pharma, Lupin and ONGC while ITC, HDFC, HDFC Bank, SBI, Hero Motocorp and BHEL slipped over half a percent. HUL remained down 2 percent post Q1 earnings.
9:55 am Results: Midcap IT company Mindtree missed analysts' expectations on profit front but revenue was in line during April-June quarter. Profit fell sharply by 7.1 percent sequentially to Rs Rs 123.5 crore in quarter ended June 2016.
Revenue increased marginally to Rs 1,327.6 crore from Rs 1,320.3 crore and revenue in dollar terms also rose 1.7 percent to USD 199 million from USD 195.6 million on QoQ basis.
Profit was estimated at Rs 155 crore on revenue of Rs 1,351 crore while dollar revenue was expected at USD 202 million for the quarter, according to average of estimates of analysts polled by CNBC-TV18.
9:45 am Red alert: A high incidence of corporate loans in YES Bank's books could further worsen its asset quality and the private lender could face operating challenges as it expands retail presence, Moody's Investors Service today said Moody's outlined a rapidly-expanding franchise with dominance of corporate loans, a higher dependence on corporate deposits relative to peers and a growing retail deposit base as credit challenges to Yes Bank.
"Given the high concentration risk and the dominance of corporate loans, we are still concerned about the asset quality and expect some further deterioration, given the pressure on Indian corporates," Moody's said in its credit opinion update on Yes Bank.
9:30 am View on international market: Sean Darby of Jefferies says the drop in US treasury rates to record lows last week alongside the growing likelihood of further unconventional policies in Japan has created an insatiable appetite for yield.
With real sovereign yields high in Asia and emerging markets (EM), there is room for equity outperformance, he feels.
Darby remains overweight EMs and are mildly bullish on India.
The market has opened marginally in green. The Sensex is up 39.87 points or 0.1 percent at 27786.53, and the Nifty is down 1.05 points at 8507.65. About 212 shares have advanced, 79 shares declined, and 24 shares are unchanged.
Tata Motors, ICICI Bank, TCS, HDFC and Tata Steel are gainers in the Sensex. HUL loses over 2 percent while Bharti, Wipro, BHEL and Adani Ports are losers. Mindtree falls 6 percent on its Q1 results.
Among global peers, Asian markets were mixed in early trade on Tuesday, with shares of internet and telecommunication giant, SoftBank, tumbling some 10 percent as the Japanese market re-opened after being closed for a public holiday on Monday.
Japan's benchmark Nikkei 225 traded up 0.36 percent, with stocks receiving a boost from a relatively weaker yen. Australian shares were mixed, with the ASX 200 index trading flat at 5,458.80. The materials sub-index was under pressure, dropping 0.53 percent as miners remain in focus this week for their second quarter production reports.
Wall Street closed slightly higher on Monday to mint new record highs for the S&P 500 and the Dow industrials, fueled by Bank of America's better-than-expected profit and a major tech sector acquisition.
In asset classes, the dollar held steady against the major currencies with the dollar index holding above the 96-mark. Crude prices slipped following a failed coup in Turkey as shipments continue through the vital conduit from Russia and Iraq to the Mediterranean Sea. Gold prices held steady around USD 1330 an ounce.