Nifty ends above 8000, Sensex firm; M&M, HDFC twins laggards
23 November 2016
3:30 pm Market closing: After a volatile session, the market has ended on firm note. The Sensex closed up 91.03 points or 0.3 percent at 26051.81, and the Nifty up 31.00 points or 0.4 percent at 8033.30. About 1906 shares have advanced, 682 shares declined, and 168 shares are unchanged.
Lupin, Tata Steel, Asian Paints, Tata Steel, NTPC and L&T were gainers while M&M, HDFC twins, Bharti Airtel and Maruti were losers in the Sensex.
3:00 pm Deal: Reliance Capital, part of Anil Ambani-led Reliance Group, on Wednesday announced value unlocking in radio and TV businesses that will help it reduce debt by approximately Rs 1900 crore.
"Reliance Broadcast Network (RBNL), the largest operator of FM channels in India, has signed definitive and binding agreements with Zee Media Corporation (ZMCL) to sell 49 percent stake in its radio broadcast business," the company said in its filing.
Simultaneously, Zee Entertainment Enterprises (ZEEL), a separate entity under Zee Group, will also acquire 100 percent stake in the Reliance Group's general entertainment TV business.
The transaction pegs the combined enterprise value of radio and TV business at approximately Rs 1,900 crore.
2:58 pm Market Update: Equity benchmarks remained higher with the Sensex rising 122.16 points to 26082.94 and the Nifty up 35.90 points at 8038.20.
About 1836 shares advanced against 656 declining shares on the BSE.
2:43 pm P-Notes investments: Investments in domestic capital markets through participatory notes (P-Notes) fell to its lowest level in two-and-half years to Rs 2 lakh crore in end-October.
P-Notes are typical instruments issued by registered foreign portfolio investors (FPIs) to overseas investors who wish to participate in Indian markets without registering themselves directly in the country to save time. But they still need to go through a proper due diligence process.
According to data available with Sebi, the total value of P-Notes investment in Indian markets -- equity, debt and derivatives -- fell to Rs 1,99,987 crore in October-end, from Rs 2,12,509 crore at the end of September.
This was the lowest level since April 2014 when the cumulative value of such investments stood at Rs 1,87,486 crore.
The investment through the route was Rs 2,16,232 crore and Rs 2,12,179 crore at the end of August and July, respectively.
2:35 pm ATM recalibration: A week after the ATM recalibration exercise, kicked off by the Reserve Bank of India (RBI) task force, almost 50 percent of total ATMs in the country have been recalibrated so far.
Sources tell CNBC-TV18 that 1.03 lakh ATMs out of 2.10 lakh have been recalibrated between November 16-22.
Government's target was to recalibrate 12,000 ATMs per day the pace of which is slowing down to 6,000-7,000.
Non-recalibrated ATMs are running at only 25 percent capacity.
2:20 pm Earnings: Siemens' fourth quarter profit jumped more than 11-fold to Rs 2,467 crore compared with Rs 219.1 crore in year-ago period, driven by stake sale in healthcare undertaking.
Total income from operations during the quarter declined 6.3 percent year-on-year to Rs 3,091 crore while other income shot up 67.8 percent to Rs 68.3 crore.
Earnings missed analysts' expectations. Revenue was estimated at Rs 3,236 crore with EBITDA at Rs 320 crore and margin at 10 percent for the quarter, according to average of estimates of analysts polled by CNBC-TV18.
The company reported an exceptional gain of Rs 2,992 crore for the quarter ended September 2016 on account of sale of healthcare undertaking, against Rs 70.7 crore in same quarter last year.
2:00 pm Market Check
Equity benchmarks gained strength in afternoon trade with the Sensex rising more than 100 points, led by banks, healthcare and infra stocks.
The 30-share BSE Sensex was up 146.92 points at 26107.70 and the 50-share NSE Nifty gained 42.25 points at 8044.55. The broader markets continued to outperform benchmarks, rising more than 1 percent on strong breadth.
About three shares advanced for every share falling on the Bombay Stock Exchange.
Lupin was the biggest gainer among Sensex 30 stocks, up nearly 5 percent. It has received tentative approval from the USFDA for Abacavir Sulfate and Lamivudine tablets that are used in inhibition of HIV replication.
L&T, Asian Paints, NTPC and Tata Steel rallied 3-4 percent followed by Axis Bank, Sun Pharma and Tata Motors. However, HDFC, HDFC Bank, M&M, Maruti, Bharti and Wipro declined 0.5-1.5 percent.
1:45 pm Pharma update: Cipla said its UK subsidiary has sold its entire stake in Chase Pharmaceuticals Corporation, a Delaware-based corporation, to a subsidiary of Allergan plc. Cipla UK arm, Cipla (EU) had 16.7 percent stake in Chase Pharmaceuticals, which was acquired in May 2014 via a syndicated venture investment. "Allergan has agreed to pay USD 125 million upfront plus potential regulatory and commercial milestones of up to USD 875 million to the shareholders of Chase," the healthcare firm said in its filing.
1:30 pm GST council meet: CNBC-TV18 learns that that GST Council meeting which was scheduled on November 25 has been cancelled. No new date is yet to be finalized. India's plans to implement a country-wide Goods and Services Tax (GST) entered the final leg with the Finance Minister Arun Jaitley-headed GST Council agreeing on a formula last month to compensate states in case of a revenue loss after moving to the new system. On compensation to states, 2015-16 will be taken as the base year for calculating revenue assuming a secular or long-term growth rate of 14 percent. States will be fully compensated till five years for potential revenue loss. The GST Council has also finalised area-based exemptions and how 11 states-the eight north-eastern states and the three hilly states, will be treated under the new tax regime.
The market is still rangebound. The Sensex is up 60.02 points or 0.2 percent at 26020.80 and the Nifty is up 18.25 points or 0.2 percent at 8020.55. About 1634 shares have advanced, 712 shares declined, and 160 shares are unchanged.
Lupin, Asian Paints, L&T, Tata Steel and NTPC are gainers while HDFC, M&M, Wipro, Bajaj Auto and Maruti are losers in the Sensex.
Gold stuck to a narrow range in Asian trade on Wednesday ahead of release of minutes from the Federal Reserve policy meeting earlier this month amid expectations of an interest rate hike in December.
Analysts cautioned that higher interest rates and a more positive sentiment in equity markets could weigh further on gold prices. Gold is highly sensitive to rising rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar, in which it is priced.
12:58 pm Market Update: The Sensex was up 52.94 points at 26013.72 and the Nifty gained 14.90 points at 8017.20. About two shares advanced for every share falling on the BSE.
12:35 pm Stake sale: Cipla said its UK subsidiary has sold entire stake in Chase Pharmaceuticals Corporation, a Delaware based corporation to the subsidiary of Allergan plc.
Cipla UK arm, Cipla (EU) had 16.7 percent stake in Chase Pharmaceuticals, which was acquired in May 2014 via a syndicated venture investment.
"Allergan has agreed to pay USD 125 million upfront plus potential regulatory and commercial milestones of up to USD 875 million to the shareholders of Chase," the healthcare firm said in its filing.
12:20 pm More relief to farmers: The government on Wednesday announced fresh measures to make more cash available for farmers and removed charges shops pay banks for card payments.
National Bank for Agriculture and Rural Development (Nabard) has sanctioned an additional Rs 21,000 crore to district cooperative banks to enable more loans available for farmers ahead of the winter sowing season.
Economic affairs secretary Shaktikanta Das said that more than 40 percent of small and marginal farmers' loan needs are met through the cooperative credit structure.
Das said that to ensure that farmers get credit and some quantum in cash, NABARD and the Reserve Bank of India (RBI) have been advised to make the required cash available to the district cooperative banks.
12:00 pm Market Check
The market continued to consolidate ahead of expiry of November derivative contacts due tomorrow. Infra, healthcare, technology and Tata Group stocks supported equity benchmarks but the selling in banking & financials limited upside.
The 30-share BSE Sensex was up 44.53 points at 26005.31 and the 50-share NSE Nifty rose 11.85 points to 8014.15 while the broader markets extended upside.
The BSE Midcap and Smallcap indices gained 0.6-0.8 percent on positive breadth as about two shares advanced for every share falling on the exchange.
Investors continued to assess the impact of demonetisation on earnings and economy.
Making no bones about the government's demonetisation drive Helios Capital Management Founder Samir Arora said it will take about 6-12 months for a recovery to take place.
Even though the move has been timed right, the shock to the system is huge and demonetisation won't solve it in 3-6 months, Arora said. He, however, pointed out that the financial regulation took away momentum that the consumer space had.
HDFC lost 2 percent while L&T and Asian Paints continued to top the buying list with 2.8 percent upside.
11:45 am FII view: Making no bones about the government's demonetisation drive Helios Capital Management Founder Samir Arora said it will take about 6-12 months for a recovery to take place. Even though the move has been timed right, the shock to the system is huge and demonetisation won't solve it in 3-6 months, Arora said. He, however, pointed out that the financial regulation took away momentum that the consumer space had. In the past 4-5 years, investors didn't make money in sectors such as realty, pharma and IT; only consumer stocks were profitable and demonetisation has blown away that advantage with demonetisation, Arora said. He cautioned that it will be tough to get that momentum back in 6 months.
11:30 am Market outlook: Speaking to CNBC-TV18 Saurabh Mukherjea of Ambit Capital said that we have been accused of saying a lot of things that are thought of as sensational but facts and subsequent events have borne them out. He was responding to Ambit's report that had estimated that GDP growth will trend down from 6.4 percent in the first half of this fiscal to 0.5 percent in the second half with likelihood that growth would shrink in the third quarter of this fiscal. He said PM Modi is clearly ringing in the changes and India will go through structural changes that will reduce black money, cost of capital and cost of land and real estate. However, he warned that such measures will entail short-term pain. He believes the real action will begin next year as some SMEs will realise they can't function in an environment where they have to pay full taxes. They will start winding up next year, he said.
After a brief rally, the market continued to slip. The Sensex is up 78.69 points or 0.3 percent at 26039.47 and the Nifty is up 17.45 points or 0.2 percent at 8019.75. About 1423 shares have advanced, 682 shares declined, and 107 shares are unchanged.
L&T, Asian Paints, Tata Steel, Lupin and Sun Pharma are top gainers while HDFC, Wipro, BHEL, Maruti and GAIL are losers in the Sensex.
Gold prices were up by Rs 59 to Rs 29,162 per 10 grams in futures trade today as speculators raised their bets even as metal weakened overseas.
Market analysts attributed the rise in gold prices at futures trade to widening of positions amid a better trend in precious metals overseas.
10:58 am R&D centre: Bakery and dairy products maker Britannia Industries announced the launch of a state-of-the-art research & development centre at Bidadi in Bengaluru with an investment of Rs 200 crore.
The new centre and the company's first owned manufacturing facility in the state will focus on fostering innovations and launch of disruptive products for Indian and global consumers, the company said.
The 55,000 square foot centre was inaugurated by Karnataka Industries Minister R V Deshpande.
The state-of-the-art centre houses analytical, sensory and microbiology labs, in addition to pilot plants for its core product portfolio, which includes biscuits, cakes, rusk, breads and dairy, the company said in a statement.
"We aim to be a 'Total Foods' Company in five years from now, serving over a billion Indians four times a day," said Varun Berry, Managing Director, Britannia Industries Limited.
10:38 am CLSA on IRB: Demonetisation will slow traffic, but stock overreacts IRB reported yet another quarter of strong toll revenue growth (+19 percent YoY); however, PAT declined 4 percent due to higher depreciation and Ind AS related non-cash finance charge.
IRB's stock has fallen 26 percent in the last one month on delay in InvIT and govt's toll-free NH policy post demonetisation, which we believe is transitory. IRB confirmed that toll road operators will be compensated by the NHAI for embargo on toll collection during the last two weeks.
However, we have cut EPS 5-10 percent in FY17-19 on cut in traffic growth estimate for potential weak economic activity led by demonetisation. On the flipside, decline in Indian G-sec yield is likely to increase attractiveness of its InvIT to investors. Robust BOT revenues and EPC orders won during 2Q increase revenue visibility
for the next two years.
CLSA advises buying the stock with a reduced price target of Rs 310 (Rs 330).
10:18 am Market Expert: Saurabh Mukherjea of Ambit Capital said PM Modi is clearly ringing in the changes and India will go through structural changes that will reduce black money, cost of capital and cost of land and real estate. However, he warned that such measures will entail short-term pain.
He believes the real action will begin next year as some SMEs will realise they can't function in an environment where they have to pay full taxes. They will start winding up next year, he said.
10:00 am Market Check
Equity benchmarks wiped out early gains with the Nifty breaking 8000 level on profit booking. Banking & financials, auto and FMCG stocks were under pressure while healthcare, technology and metals stocks gained.
The 30-share BSE Sensex was down 13.78 points at 25947 and the 50-share NSE Nifty fell 4.55 points to 7997.75 while the broader markets outperformed benchmarks.
The BSE Midcap and Smallcap indices gained 0.3 percent each on positive breadth. About 1143 shares advanced against 695 declining shares on the BSE.
L&T extended gains in morning, up nearly 4 percent after the company maintained its order inflow and revenue guidance for FY17.
Asian Paints and Tata Steel gained 2-3 percent whereas HDFC was the biggest loser on Sensex, down 2.7 percent followed by ITC, Maruti, M&M, ICICI Bank, Wipro and HDFC Bank.
Asian stocks traded higher, tracking US stock markets' rise to all-time closing highs on Tuesday. Australian index surged 1 percent.
9:55 am Market falls again: The Sensex is down 17.27 points at 25943.51, and the Nifty down 8.85 points at 7993.45. About 1118 shares have advanced, 634 shares declined, and 87 shares are unchanged.
9:50 am Demonetisation impact on GDP: Demonetisation is likely to pull down GDP growth by 1-2 percentage points as it is disrupting economic activities, especially in the informal sector, said former Planning Commission Deputy Chairman Montek Singh Ahluwalia.
"The (economic) growth rate is going to be adversely affected. There is no question on that. Somewhere between one to two percent," Ahluwalia said in an interview on TV channel India Today.
Earlier this month, the government demonetised currency notes of Rs 500 and Rs 1,000, replacing them with new Rs 500 and Rs 2,000 bills in an effort to root out black money and terror funding.
On the impact of the movw, Ahluwalia said, "The adverse impact will be the most on employment intensive part of GDP.
9:40 am Market erases gains: The Sensex is up 46.01 points or 0.2 percent at 26006.79 and the Nifty isup 10.15 points or 0.1 percent at 8012.45. About 1135 shares have advanced, 468 shares declined, and 64 shares are unchanged.
L&T is up 4 percent while Tata Steel, Asian Paints, Lupin and Sun Pharma are gainers. GAIL, Wipro, NTPC, BHEL and Maruti are losers in the Sensex. Wockhardt falls 3 percent.
9:30 am FII view: Khoi Le Binh of Deutsche Bank says US election results generally a net negative for Asian stocks, but unlikely to derail the improving growth backdrop.
Rates, USD & trade are the key risks, he feels.
Despite trade concerns, he is most positive on Japan and China. Amongst South East Asia, he prefers Indonesia and India.
Binh says he is unclear how the impact of demonetisation/US election will impact India as return on equity remains under pressure.
Boosted by strong global cues, the market opened firm Wednesday. The Sensex is up 152.47 points or 0.6 percent at 26113.25, and the Nifty up 48.90 points or 0.6 percent at 8051.20. About 423 shares have advanced, 79 shares declined, and 20 shares are unchanged.
L&T, GAIL, Wipro, Adani Ports and Cipla are gainers while Dr Reddy's Labs and Bajaj Auto are losers in the Sensex. Wockhardt is down around 3 percent post US FDA warning letter.
The Indian rupee has touched 8-month low in early trade. It has opened at 68.36 against the US dollar, down 11 paise compared with previous settlement at 68.25 a dollar.
Pramit Brahmbhatt of Veracity says a stronger Dollar index will continue to put pressure on the rupee for the day, as it is trading above the 101 mark.
According to him, the trading range for the USD-INR is seen between 68-68.50 against the US dollar.
The dollar resumed its uptrend helped by a surge in US existing home sales last month that further cemented expectations not only of a Federal Reserve interest rate hike in December, but also of further tightening next year.
Among global markets, Asian stocks crept to one-week highs as investors tried to share in the exuberance of Wall Street, where the three main indices seized record peaks for a second straight session.
MSCI's broadest index of Asia-Pacific shares outside Japan also added 0.3 percent, edging further away from four-month lows hit on Monday.
The Dow closed up 0.35 percent and above 19,000 for the first time. The S&P 500 gained 0.22 percent and the Nasdaq 0.33 percent. Still, the market is starting to look expensive with the S&P 500 trading near 17.3 times forward 12-month earnings, compared to the 10-year median of 14.7, according to StarMine data.
Crude oil prices gave up gains on worries Iran and Iraq were not ready to agree on an OPEC output freeze. Prices earlier rose to the highest level this month on reports cartel members had overcome their internal disputes.
Gold edged lower on after US equities hit all-time highs on market expectations for higher growth and more spending from a Donald Trump presidency. Investors cut holdings for an eighth consecutive session, amid speculation that the Federal Reserve will raise US interest rates next month.