Nifty ends above 8600, Sensex up 120 points; Tata Motors, RIL gain
29 August 2016
3:30 pm Market closing: Late minute buying pushed market higher at closing. The Sensex closed up 120.41 points or 0.4 percent at 27902.66 and the Nifty was up 34.90 points or 0.4 percent at 8607.45. About 1214 shares advanced, 1472 shares declined, and 202 shares were unchanged.
Tata Motors, Reliance, Hero MotoCorp, Adani Ports and ICICI Bank were gainers while Wipro, Lupin, HDFC Bank, Bharti Airtel and Asian Paints were losers in the Sensex.
3:10 PM Pharma update: Dr Reddy's Laboratories said it has launched nitroglycerin sublingual tablets, a therapeutic equivalent generic version of Nitrostat (Nitroglycerin) sublingual tablets in the US.
The drug which is used in preventing or relieving a sudden attack of angina (chest pain) caused by heart disease was approved by the United States Food and Drug Administration (USFDA).
According to a statement issued by the drug maker, Nitrostat (Nitroglycerin) sublingual tablet brand had the US sales of about USD 108 million for the most recent 12 months ending in March 2016 (according to IMS Health data).
2:56 pm Acquisition: Sony is likely to buy Ten Sports from Zee Entertainment for nearly Rs 2,000 crore, reports CNBC-TV18.
The deal could be announced this week.
Zee had bought 50 percent stake in Ten Sports in 2006 for an enterprise value (EV) of USD 114 million or roughly Rs 800 crore.
Ten Sports contributes about 15 percent to Zee's total sales. However, Zee wanted to exit the business as it incurred earnings before interest and tax (EBIT) loss of nearly Rs 100 crore.
If it goes through, the deal will be positive for Zee with fund inflow of nearly Rs 2,000 crore and exit from a loss making business. Sony, on the other hand, will get additional channels in its Sports bouquet to compete with Star India.
2:45 pm Buzzing: Credit Suisse said it slashed target price further on Lupin to Rs 1,290 from Rs 1,450 per share as base business is only 40-50 percent of total profits due to high contribution from Fortamet, Glumetza and Minastrin.
It also cut FY17 earnings per share by 15 percent to factor Mylan entry in Fortamet.
The stock lost more than 2 percent.
2:35 pm Market Update: Equity benchmarks extended upside in last hour of trade with the Sensex rising 108.67 points to 27890.92 and the Nifty gaining 27.70 points at 8600.25.
2:20 pm Earnings: IOC has posted better-than-expected net profit at Rs 8269 crore in June quarter up by a whopping 390 percent from Rs 1685.3 crore in last quarter. Total income also rose to Rs 1,07,200.7 crore against Rs 98,704.7 crore on sequential basis.
Gross refining margins in Q1 was at USD 9.98 per barrel from USD 10.77 per barrel in corresponding quarter last fiscal. The board has approved 1:1 bonus issue.
According to a CNBC-TV18 poll, the state-run oil retailer first quarter standalone profit was likely to grow more than 3-fold to Rs 4127 crore while revenue was seen rising 20.6 percent to Rs 97,032 crore during the quarter compared in previous quarter.
The oil marketing company had reported a high refining inventory loss of Rs 3,300 crore in Q4FY16, and product inventory loss of Rs 1,100 crore. Hence sequential earnings increase in Q1 is sharp.
2:00 pm Market Check: Equity benchmarks gained strength in afternoon trade with the Nifty inching towards 8600, driven by Tata Motors, Reliance Industries, HDFC, ICICI Bank and L&T.
The 30-share BSE Sensex rose 86.52 points to 27868.77 and the 50-share NSE Nifty was up 22.20 points at 8594.75.
Tata Motors surged 4.5 percent as brokerage houses increased target price on the stock after Q1 earnings.
1:55 pm Macro: HDFC Chairman Deepak Parekh said the country's economy is in a "stronger position" and demonstrating an immense growth potential with a strong leadership at the helm bringing in key reforms.
"India has never been in a stronger position than today from a macro-economic perspective. The country is demonstrating an immense growth potential helped by a strong leadership at the helm, driving key policy changes," Parekh said at a risk summit organised by CII.
He noted that with the present government, large scale corruption has been weeded out.
1:30 pm Result poll: DLF is likely to post another weak quarter due to slowdown in sales. According to CNBC-TV18 poll, its net profit may see growth of 19 percent at Rs 144 crore in April-June quarter from Rs 121 crore in corresponding quarter last fiscal. During the quarter, its revenue is expected to be flat at Rs 2240 crore against Rs 2231 crore on annual basis. In Q1 its EBITDA is seen up 5 percent at Rs 870 crore from Rs 828 crore while its operating profit margin (OPM) may stand at 38.9 percent against 37.1 percent year-on-year. Slowdown in sales seen across all micro markets except Gurgaon. Pre-sales are expected to fall 50 percent (QoQ) at 0.24 msf versus 0.5 msf QoQ. Pre-sales value expected to fall 55 percent (QoQ) at Rs 510 crore against Rs 1130 core.
The market is still under pressure as the Sensex is down 12.74 points at 27769.51. The Nifty is down 6.40 points at 8566.15. About 1075 shares have advanced, 1400 shares declined, and 196 shares are unchanged.
Tata Motors, L&T, Hero MotoCorp, Relinace and Tata Steel are top gainers in the Sensex while Lupin, Wipro, TCS, Asian Paints and HDFC are losers in the Sensex.
Global and domestic stock markets may be doing well but they are not in the exuberance zone, says Motilal Oswal, Chairman and MD of Motilal Oswal Financial Services (MOFSL).
Speaking to CNBC-TV18's Prashant Nair, Oswal dissected the argument that excess liquidity sloshing around had lifted all assets globally, and said that only good quality stocks were doing well.
Locally, Oswal says that the market had rallied because of a number of factors such monsoon, passage of Goods and Services Tax (GST) Bill and announcement of new Reserve Bank governor. Going forward, the market may need fresh cues to keep running, he adds.
12:59 pm Market Update: Volatility continued in afternoon trade. The Sensex gained 17.03 points at 27799.28 and the Nifty rose 1.90 points to 8574.45.
About 1346 shares declined against 1088 advancing shares on the BSE.
12:40 pm Europe opens: European stocks opened lower as the US dollar strengthened after hawkish comments from US Federal Reserve Chair Janet Yellen in a closely watched speech last Friday.
The pan-European STOXX 600 was down 0.32 percent. London's FTSE 100 is closed for a public holiday.
Yellen said the case for a rate hike had "strengthened in recent months" pointing towards the "solid performance" of the labor market and positive outlook on economic activity, at a speech at the annual Jackson Hole gathering of central bankers on Friday.
12:20 pm Interview: Shree Renuka Sugars share are trading higher on news that the Judicial Protection Law has approved a rejig plan presented by the company's Brazilian arm.
Speaking about the same to CNBC-TV18, Narendra Murkumbi of Shree Renuka Sugars said the banks were ready to take 70 percent haircut and exit with 30 percent of the face value of the debt.
Murukumbi said the company was not putting in any new money at the moment, but in fact was hiving off one of the units of the Brazilian subsidiary.
12:00 pm Market Check
Equity benchmarks as well as broader markets remained volatile and have been moving in a tight range as investors remained sideways after pricing in all events.
The 30-share BSE Sensex was up 18.60 points at 27800.85 and the 50-share NSE Nifty gained 3.35 points at 8575.90.
Multi-format retailer Future Retail shares are locked at 5 percent upper circuit at Rs 161.05. Retail business of the Future Group has been merged with Bharti Retail and then changed the name to Future Retail. Under the scheme of arrangement, the company was divided into Future Enterprises, which is a backend business, and Bharti Retail that is a fronted business.
Japanese shares climbed, boosted by a weaker yen, while other Asia markets put in a mixed performance. The benchmark Nikkei 225 gained 2.3 percent, while the Topix added 2.01 percent.
Oil prices fell over 1 percent as Iraq's production rose and as Iran said it would only cooperate in producer talks to freeze output if fellow exporters recognized its right to fully regain market share. International Brent crude oil futures were trading at USD 49.29 per barrel, down 1.26 percent, from their previous close. US West Texas Intermediate (WTI) crude futures were down 1.49 percent, at USD 46.93 a barrel.
Prices have fallen by over 3.5 percent since their August peaks.
11:55 am View on consumption sector: Industry experts expect a consumption boom in second half of the fiscal as government has raised expenditure for the rural sector and the country was blessed with a good monsoon.
Gautam Duggal, Head of Research, Institutional Equities, Motilal Oswal, told CNBC-TV18 that after a good monsoon, there is hope for consumption to improve in the second half of the fiscal.
Two droughts and a deceleration in rural wage growth have led to moderation in rural consumption, even as urban spending has fared decently and sustained a 7-8 percent growth, he added.
11:45 am Macro outlook: India is expected to clock a gross domestic product (GDP) growth of nearly 8 percent for this financial year on the back of good monsoon rains, Economic Affairs Secretary Shaktikanta Das said.
"Last year, we achieved 7.6 percent growth on the back of failure of two monsoons. This year monsoon rains have been good, he said.
"Agriculture production is expected to be much better than previous two years and definitely agriculture will contribute significantly to the GDP," Das added on the sideline of a conference on 'International Arbitration in BRICS: Challenges, Opportunities and Road ahead'.
11:30 am Market outlook: Infosys is more likely to grow at 12-13 percent now on, unlike the 25-30 percent growth rates seen in the past, says Raamdeo Agrawal, Joint MD, Motilal Oswal Financial Services after attending the Infosys analyst call. The company is currently in a transformation mode and is trying to build the next generation company with focus on digitisation, Agrawal says. Talking on the sidelines of Motilal Oswal Annual Investor Conference, he says the idea of the meet is to gauge the mood in corporate circles, especially post passage of the GST Bill. The spotlight will also be on what is happening in the banking space. According to Agrawal, power has not made lot of money for investors but holds good potential. He said he was looking forward for Power Minister Piyush Goyal's commentary at the conference and the government's plans for the next two and half year.
The market continues its struggle with the Sensex up 4.20 points at 27786.45. The Nifty is down 2.50 points at 8570.05. About 1003 shares advanced, 1147 shares declined, and 146 shares are unchanged.
Tata Motors, Hero MotoCorp, Tata Steel, Axis Bank and Reliance are gainers while TCS, Wipro, HDFC Bank, Asian Paints and Adani Ports are losers in the Sensex.
Oil prices tumbled in Asia today on a strong dollar and after key OPEC producers downplayed the prospects of limiting output at a meeting next month.
Iranian oil minister Bijan Zanganeh on Friday said his country wanted its share of the crude market to return to levels seen before Western nuclear sanctions were imposed on it 13 years ago.
The comments suggest Tehran might not join possible efforts by OPEC and Russia to cap production at the gathering in Algeria.
Earlier, Saudi Arabia's energy minister Khalid Al-Falih also downplayed hopes for a cut in production.
10:50 am Coal India buys coal mines: Coal India 's board has approved signing of a pact with African Exploration Mining & Finance Corporation SOC Ltd (AEMFC), owned by the South African government, for acquisition of coal mines in that country.
"The CIL board has accorded approval to the proposal for execution of MoU between CIL (Coal India) and African Exploration Mining & Finance Corporation, SOC Ltd (AEMFC), an entity owned by the government of South Africa for identification, acquisition, exploration, development and operation of coal assets in South Africa," a recent report of the PSU said.
The decision of the CIL board, it said, has been communicated to AEMFC requesting them to finalise the date and venue of signing of the agreement.
Coal and Power Minister Piyush Goyal had earlier in the month informed Parliament that CIL is looking at entering into a pact with a South African government miner to jointly acquire coal mines in that country.
10:20 am New listing: Multi-format retailer Future Retail shares started off first trade at Rs 153.40 on Monday against previous close of Rs 151.05 on the National Stock Exchange.
The stock is locked at 5 percent upper circuit at Rs 161.05.
The exchanges have fixed circuit limit of 5 percent for the stock as it is available for trading in T Group category.
Future Retail, the flagship company of Future Group, operates multiple retail formats in the hypermarket, supermarket and home segments through Big Bazzar, Easy Day, KB's, FBB, Food Bazzar, Foodhall, Home Town and ezone.
Promoters held 48.82 percent stake in the company, including Future Corporate Resources' 37.66 percent shareholding as of July 25.
10:17 am Market Expert: Global markets may correct 5-6 percent if the US Fed decides to hike rate depending on the job data expected this Friday, says CNBC-TV18's Consulting editor Udayan Mukherjee.
If the Fed does hike rates, there is unlikely to be a mayhem in equities as markets will price it in advance.
Nifty, which is struggling to top 8700, has been rallying sideways over the last month with some shallow corrections. Liquidity, the big driver of this market, is now drying up, Mukherjee says.
''Market is bereft of triggers now,'' he says adding this could keep the market in check. The focus will now be on specific stocks, he says.
10:00 am Market Check:
Equity benchmarks remained in a consolidation phase with the Nifty hovering around 8550 level due to lack of global as well as domestic triggers. Inflow of foreign money also dried up last week after hefty buying by FIIs since March.
The 30-share BSE Sensex was down 55.22 points at 27727.03 and the 50-share NSE Nifty down 19.25 points at 8553.30. The market breadth was negative as about 1040 shares declined against 780 advancing shares on the BSE.
TCS, Adani Ports and Wipro were top losers on the Sensex, falling 2 percent each while Tata Motors topped the buying list again, up 4 percent as brokerage houses raised target price on the stock after Q1 earnings.
The Indian rupee has been trading above 67 a dollar from last week, down 10 paise compared to Friday's closing value.
9:55 am Upgrade: Financial services major Goldman Sachs has marginally revised upwards its India CPI forecast to 5.5 percent for the fiscal citing higher food prices but said the upside risks are limited due to delay in the rollout of the pay commission award.
According to the global major, narrowing of the output gap and abating favourable base effects from weak commodity prices may lead to an rise in inflation.
"We mechanically adjust our FY17 headline CPI inflation forecasts upwards to 5.5 percent yoy, from 5.3 percent earlier, due to higher than expected food inflation readings year-to-date," Goldman Sachs said in a research note, adding core inflation is expected to average 4.8 percent yoy this fiscal from 4.6 percent a year ago.
9:45 am Tata Motors worries: Forex losses that Tata Motors incurred in June quarter is troubling analysts though most feel that the auto major will weather the turbulence. Tata's Q1 results were dragged down by forex losses at Jaguar Land Rover(JLR) even as India business continued to improve.
Its mark-to-market (MTM) forex impact on euro payables, FX losses on realised hedges, a weaker product-mix (higher share of Jaguar) and the operating leverage impact ofpower volumes on a QoQ basis impacted its earnings in June quarter.
As pound fell to a 31-year-low as Britain voted to exit from European Unionon June 24, the auto major with British Subsidiary Jaguar Land Rover lost Rs Rs 2296 crore from its profit while adverse commodity derivatives blew a hole of Rs 167 crore.
9:30 am FII view: In what has become a clear positive trend, the Asia Pacific ex-Japan earnings revision ratio improved in August for the sixth consecutive month from 0.81 to 0.88, Nigel Tupper of Bank of America Merrill Lynch says.
In the past when the ratio has been rising and near this level, Asia Pacific ex-Japan has rallied 14 percent in the subsequent 12 months, on average.
"Also, our macro indicator, the Global Wave, remains positive on equities and cyclicals and this persistent earnings recovery should sustain the rotation into cyclical assets," Tupper says.
The market has opened flat reacting to Federal Reserve Chair Janet Yellen's comments on rate hikes. The Sensex is up 39.01 points or 0.1 percent at 27821.26, and the Nifty is up 11.20 points or 0.1 percent at 8583.75. About 172 shares have advanced, 93 shares declined, and 17 shares are unchanged.
Tata Motors, L&T, Cipla, Sun Pharma and Asian Paints are top gainers while Adani Ports, Lupin, Bharti, SBI and Axis are losers in the Sensex.
The Indian rupee opened lower by 8 paise at 67.14 per dollar versus 67.06 Friday.
Pramit Brahmbhatt of Veracity said, "Interest rate speculation will continue to keep the USD higher. We expect the USD-INR pair to trade in the range of 66.90-67.20/dollar today."
The dollar was near a two-week high against the yen after comments from Central Bank chiefs at the weekend reinforced the divergence between monetary policy in the US and other parts of the world.
Bank of Japan governor Haruhiko Kuroda reiterated a pledge to ease monetary policy further if necessary, saying that he would bolster economic stimulus "without hesitation."
Most Asian share markets slipped while the US dollar held firm. MSCI's broadest index of Asia-Pacific shares outside Japan slid 0.7 percent.
Japan's Nikkei, bucked the trend and climbed 2.2 percent as the yen weakened against the resurgent dollar.
The case for a rate hike has strengthened in recent months, with a lot of new jobs being created, and economic growth is looking likely to continue at a moderate pace, Yellen said in a speech at the Fed's annual monetary policy conference in Jackson Hole, Wyoming, on Friday.