Sensex, Nifty close higher for 2nd day; RIL, ITC, HDFC support
15 September 2016
3:30 pm Market Closing: Equity benchmarks ended marginally higher for the second consecutive session after rangebound trade.
The Sensex was up 40.66 points at 28412.89 and the Nifty up 15.95 points at 8742.55. About 1460 shares advanced against 1258 declining shares on the BSE.
Reliance Industries, HDFC, HDFC Bank and ITC supported the market whereas banks and auto stocks were under pressure.
3:10 pm IPO subscription: IPO of L&T Technology Services, an arm of engineering giant Larsen and Toubro (L&T), got oversubscribed 1.43 times till afternoon trade on the last day of the offer today.
The Rs 900-crore IPO, received bids for 1,04,33,712 shares as against the total issue size of 72,80,000 shares, data available with the NSE till 1400 hrs showed.
This is the second company from the L&T Group to hit the market with an IPO since July, when L&T Infotech had launched a public offer. The flagship Larsen and Toubro is already listed.
3:04 pm Market Update: Equity benchmarks gained strength in late trade with the Sensex rising 64.14 points to 28436.37 and the Nifty up 23.85 points at 8750.45.
About 1427 shares advanced against 1224 declining shares on the BSE.
2:58 pm Foodgrains output: Buoyed by a good monsoon after two consecutive years of drought, the country's foodgrain output is expected to touch a record in the ongoing 2016-17 crop year, Agriculture Minister Radha Mohan Singh said today.
The country had last achieved a record output of 265.04 million tonnes (MT) in the 2013-14 crop year (July-June).
However, the production in 2014-15 and 2015-16 fell to 252.02 MT and 253.23 MT, respectively, due to drought.
The government has set a target to achieve a record foodgrains production of 270.10 MT in 2016-17 crop year on hopes of bountiful rains. It has pegged paddy output at 108.50 MT, wheat at 96.50 MT and pulses at 24.50 MT for this year.
2:40 pm Order win: Power equipment maker Transformers and Rectifiers said it has bagged order worth Rs 103 crore from Power Grid Corporation of India Ltd to supply power transformers.
"Transformers and Rectifiers (India) Ltd has been awarded the order for...power transformers up to 220 kV class amounting to Rs 103 crore from Power Grid Corporation of India Ltd (PGCIL)," the company said in a filing to BSE.
The said order falls under the normal course of business, it said.
The company neither has any interest in the entity that awarded the order nor fall within related party transactions, it added.
With this order, the company's order book as on date stands at Rs 960 crore, it said.
2:20 pm Buyback offers: Mining giant NMDC and manganese miner MOIL today said their share buyback programmes worth close to Rs 8,400 crore will open next week on September 19.
A major portion of the proceeds from the offer will go to the government, which owns 80 percent in both the PSUs and is eying to meet its disinvestment target of Rs 56,600 crore for the current fiscal ending March 2017.
In separate regulatory filings, both the public sector undertakings (PSUs) informed about the 'Letter of Offer'.
The buyback offers will open on September 19 and will close on September 30, 2016.
2:00 pm Market Check
Equity benchmarks remained lacklustre on mixed global cues as investors waited for the outcome of two-day Federal Reserve policy meeting on September 21.
The Sensex was up 28.24 points at 28400.47 and the Nifty up 8.35 points at 8734.95 while the market breadth remained positive as about 1417 shares advanced against 1192 declining shares on the BSE.
Reliance Industries extened gains in afternoon trade, up 1.35 percent. However, Infosys fell 0.6 percent after Vishal Sikka, MD & CEO says he sees some challenges in BFSI, but won't have any negative impact overall. He expects Q2 to be better than Q1.
European seesawed as global markets trod carefully amid nerves over central bank action. The US Federal Reserve meets on September 20, although the chances of a rate hike remain slim; market expectations for a Fed rate hike next week were 15 percent, according to the CME Group's FedWatch tool.
1:45 pm Issue oversubscribed: Auto components maker GNA Axles' Rs 130-crore IPO was oversubscribed 1.36 times till afternoon trade on the second day of the bidding today.
The IPO received bids for 60,60,390 shares against the total issue size of 44,70,000 shares, as per NSE's data till 1300 hrs.
The issue was subscribed 64 per cent yesterday.
The company has fixed a price band of Rs 205-207 per share for the offer, which would close tomorrow.
1:35 pm IPO: HPL Electric & Power has fixed the price band for its Rs 361 crore IPO at Rs 175-202 per share. The company's initial public offer (IPO) will open from September 22-26.
It had filed its Draft Red Herring Prospectus (DRHP) with Sebi in February for its IPO. The regulator cleared the proposed initial share sale and gave its final observations on the IPO on May 20.
The proceeds of the issue will be utilised for repayment of loans, to fund working capital requirements and for other general corporate purposes, according to the prospectus of the company.
1:25 pm Rupee devaluation?: As the rupee saw a sudden plunge this morning on reports of currency devaluation, Finance Ministry officials today said there were no plans to devalue the domestic unit and its value will continue to be determined by the market.
With exports falling in all but one of the past 20 months, there were reports that the Commerce Ministry may discuss with Finance Ministry possible rupee-devaluation.
"Commerce Ministry pushes for all these things. There is no proposal to devalue," a top Finance Ministry official said.
"Exporters would have come to the Commerce Ministry with this issue. However, there is nothing to discuss from our side." Commerce Minister Nirmala Sitharaman too said she had not said that the government was discussing a devaluation.
"I had no conversation on devaluation of any currency with any news correspondent. Any quotes/mentions referring to me on this topic baseless," she tweeted.
1:00 pm Market Check
The choppy trade continued for second consecutive session as investors remained cautious ahead of two-day Federal Reserve's policy meeting that will start on September 20.
The 30-share BSE Sensex was down 30.49 points at 28341.74 and the 50-share NSE Nifty declined 11.95 points to 8714.65.
Axis Bank, Hero Motocorp and Tata Steel fell over 2 percent while ITC, Maruti, BHEL and Cipla gained 1-2 percent.
European stocks were mixed as global markets trod carefully amid nerves over central bank action.
Oil prices rebounded after falling around 3 percent in the previous session, supported by an unexpected fall in US crude inventories. Brent crude futures were trading at USD 46.04 per barrel, up 0.45 percent, from the last settlement. US West Texas Intermediate futures were up 0.16 percent, at USD 43.65 a barrel.
12:43 pm Europe opens: European stocks opened slightly lower as global markets tread carefully amid nerves over central bank action.
The pan-European STOXX 600 was down 0.1 percent.
Markets in Asia opened lower, following a mixed finish in the US as oil prices dropped further and uncertainty lingered over key central bank policy meetings next week.
The US Federal Reserve meets on September 20, although the chances of a rate hike remain slim; market expectations for a Fed rate hike next week were 15 percent, according to the CME Group's FedWatch tool.
12:25 pm Salary growth: India has seen a salary growth of just 0.2 per cent since the great recession eight years back, while China recorded the largest real salary growth of 10.6 per cent during the period under review, says a report.
According to a new analysis by the Hay Group division of Korn Ferry, India's salary growth stood at 0.2 per cent in real terms, with a GDP gain of 63.8 per cent over the same period.
During the period under review, China, Indonesia and Mexico had the largest real salary growth at 10.6 per cent, 9.3 per cent and 8.9 per cent, respectively.
Meanwhile, some other emerging markets including Turkey, Argentina, Russia and Brazil had the worst real salary growth at (-) 34.4 per cent, (-) 18.6 per cent, (-) 17.1 per cent and (-) 15.3 per cent, respectively.
12:00 pm Market Check:
Equity benchmarks remained choppy in noon trade with the Sensex hovering around 28400 level. The Indian rupee fell sharply to breach 67 a dollar on proposal for devaluation.
The 30-share BSE Sensex was up 22.72 points at 28394.95 and the 50-share NSE Nifty up 5.35 points at 8731.95. About 1319 shares advanced against 1050 declining shares on the BSE.
The Indian rupee fell abruptly today after sources told CNBC-TV18 that the commerce ministry will propose a devaluation in the unit to promote dwindling exports, but trimmed losses after a finance ministry denial.
The rupee was trading at 67.03 to the dollar, down 14 paise compared with previous close.
ITC, Sun Pharma, Maruti, HUL, Cipla and Bharti gained 1-2 percent while Axis Bank, ICICI Bank, Hero Motocorp and Tata Steel dropped 1-2.5 percent.
11:40 am FII View: Herald Van Der Linde of HSBC said while risk to Asian equities from earnings was falling, new risks are emerging with the steeper US yield curve.
Generally Asian equities do not perform well in such an environment. The markets that have historically been most sensitive to this are Indonesia, the Philippines and Thailand. China, Singapore and Taiwan have tended to do better.
Hence, the brokerage house feels Asian equities tend to perform poorly in times of steeper yield curves but believes their long-term story remains intact.
HSBC has maintained overweight rating on Indian equities and believes that the August CPI print of 5 percent marks the start of a prolonged period (approximately a year) in which CPI inflation is likely to trend at or below 5 percent.
"This makes us believe that there is room for a 50 bps rate cut, which would further support our case to be overweight on India," Herald said.
11:25 am Rupee devaluation likely?: The Commerce and Finance ministries are likely to discuss a possible devaluation of the rupee at a meeting next week, according to a government official who did not wish to be quoted, reports CNBC-TV18.
The Commerce Ministry is in favour of a 'calibrated' devaluation of rupee as it feels current rupee level does not reflect market dynamics, the official said. The ministry believes rupee's real effective exchange rate is overvalued against several emerging market economies, the official added.
The ministry feels that rupee devaluation is a must for export competitiveness, the official said.
11:00 am Market Check
Equity benchmarks remained in rangebound in morning trade with the Nifty hovering around 8725 level. Gains in FMCG, pharma, HDFC group stocks offset by fall in banks, select auto & infra stocks.
The 30-share BSE Sensex was up 8.52 points at 28380.75 and the 50-share NSE Nifty fell 1.65 points to 8724.95. About 1264 shares advanced against 899 declining shares on the BSE.
Hinduja Foundries was locked at 20 percent lower circuit and Ashok Leyland fell 4 percent on merger plan.
Cipla, ITC, HUL, Sun Pharma, Maruti Suzuki, Aurobindo Pharma and Zee Entertainment were gainers while Axis Bank, Hero Motocorp, Tata Steel, L&T, ICICI Bank, Yes Bank and Bank of Baroda were losers.
10:22 am Market turns negative: Equity benchmarks erased early gains amid consolidation. The Sensex was down 27.58 points at 28344.65 and the Nifty down 14.15 points at 8712.45.
About 1165 shares advanced against 836 declining shares on the BSE.
10:20 am Market Outlook: Concerns of a weak monsoon have started to worry Indian markets but a 4-5 percent deficit is no cause for concern, according to experts. About 86 percent of the country has got "normal" and "above normal" rainfall, but the figure may slide when withdrawal of the southwest monsoon begins this week.
A subdued monsoon is a disappointment but it is unlikely to affect the rural economy, Sanjeev Prasad, Senior Executive Director & Co Head (Strategy) at Kotak Institutional Equities, told CNBC-TV18. The concerns are more in the non-agricultural segment of the rural economy such as construction and mining which have not been doing well in the past, he said. One good monsoon would not have changed the segment, he added.
10:00 am Market Check
Equity benchmarks continued to consolidate for the second consecutive session as investors waited for the outcome of two-day policy meeting of the Federal Reserve next week.
The 30-share BSE Sensex was up 31.18 points at 28403.41 and the 50-share NSE Nifty rose 9.45 points to 8736.05.
The market breadth remained positive for second day as about two shares advanced for every share falling on the Bombay Stock Exchange.
ITC, Adani Ports, Sun Pharma, Cipla, BHEL and GAIL were top gainers on the Sensex, up 1-2 percent whereas Infosys, Axis Bank, Hero Motocorp and Bajaj Auto lost 1-2 percent.
Oil prices rebounded today after falling around 3 percent in the previous session, supported by an unexpected fall in US crude inventories.
Brent crude futures were trading at USD 46.10 per barrel, up 0.55 percent, from the last settlement. US West Texas Intermediate futures were up 0.3 percent, at USD 43.71 a barrel.
9:45 am Stake acquisition: ONGC Videsh signed an agreement to raise stake in Russia's Vanok oil field by 11 percent to 26 percent for about USD 930 million.
OVL, the overseas arm of state-owned Oil and Natural Gas Corp (ONGC), had last year bought 15 percent stake in the field for USD 1.268 billion. It paid an additional USD 930 million for another 11 percent stake.
The firm and its wholly-owned subsidiary ONGC Videsh Vankorneft Pte Ltd, Singapore "jointly signed definitive agreements with Rosneft, the national oil company of Russia for acquiring additional 11 percent shares in JSC Vankorneft, a company organized under the law of Russian Federation which is the owner of Vankor Field and North Vankor license," the company said in a statement.
After the closing of the present transaction, OVL will raise its participation share in Vankorneft to 26 percent.
9:25 am Cement volumes: Adversely impacted by heavy rains and sand mining issues, cement industry's volumes seems to have slowed down to 22 million tonnes during August, but is expected to improve from October as construction activities resume post monsoon, says a report.
According to ICICI Securities, the volumes have been impacted primarily due to decline in cement growth in the north and the central regions. These regions have likely seen a decline of 5-7 percent in August compared to same period year-ago, due to heavy rains and sand mining issues.
Meanwhile, the eastern part of the country continued with its growth momentum with 6 percent in the last month over the same period a year ago.
The southern region also appeared to have grown 5-6 year- on-year on low base from last year, it said.
9:15 am Market Check
Equity benchmarks started off trade marginally higher on Thursday with the Sensex rising 42.89 points to 28415.12 despite mixed Asian cues.
The Nifty is inching towards 8750, up 11.30 points at 8737.90.
Asian Paints, HDFC, Reliance Industries, ICICI Bank, HDFC Bank and ITC were early gainers while Infosys, Axis Bank, Hero Motocorp, L&T and Tata Steel were under pressure.
Tata Power gained more than a percent after its unit acquired Welspun Renewables Energy Private Ltd while Reliance Communications rose nearly 2 percent on merger with Aircel.
Yes Bank fell nearly 4 percent on a media report the Securities & Exchange Board of India is looking into the lender's notices to stock exchanges about the planned equity placement (QIP), the surge in the Yes Bank scrip in the run-up to the issue date and its intra-day fall before the announcement to call off the issue.
The Indian rupee has opened at 66.88 a dollar compared with 66.89 a dollar in previous session.
Mohan Shenoi of Kotak Mahindra Bank says global currency markets are rangebound ahead of the September FOMC rate setting decision.
According to him, the rupee is likely to trade in a range of 66.70-67 per dollar today.
The currency closed marginally higher at 66.89 a dollar yesterday compared with 66.92 a dollar on Monday.
Markets in Asia were mixed, following a mixed finish in the US as oil prices dropped further and uncertainty lingered over key central bank policy meetings next week. Nikkei fell over a percent and Shanghai was down 0.7 percent while Hang Seng gained 0.6 percent.