Sensex falls 104 points, Nifty holds 8750; BHEL soars 5%

3:30 pm Market closing: Benchmark indices lost ground on profit booking as investors remained cautious ahead of RBI policy due tomorrow.

The 30-share BSE Sensex was down 104.12 points at 28335.16 and the 50-share NSE Nifty declined 32.75 points to 8768.30.

The market breadth was negative as about 1551 shares declined against 1342 advancing shares on the BSE.

BHEL surges 5 percent on better-than-expected earnings.

3:08 pm Results: IDBI Bank has reported a net loss of Rs 2,255 crore in the quarter ended December 2016, which widened compared with loss of Rs 2,184 crore in same quarter last year. Higher non-performing assets & provisions and lower net interest income & operating profit impacted profitability of the bank.

Net interest income during the quarter fell sharply by 45.3 percent to Rs 850.4 crore from Rs 1,555 crore in corresponding quarter of last fiscal.

Non-interest income (other income) also declined 4.7 percent year-on-year to Rs 551.15 crore and operating profit tanked 83.7 percent to Rs 182.2 crore in quarter ended December 2016.

Asset quality deteriorated further, with gross non-performing assets as a percentage of gross advances rising 211 basis points sequentially to Rs 15.16 percent and net NPA up 129 basis points at 9.61 percent in quarter gone by.

2:45 pm Interview: The fresh slippages reduced for Punjab National Bank in the third quarter to Rs 4,800 crore compared to the Rs 5,089 crore quarter-on-quarter, the bank reported in its Q3 earnings. In Q4, the slippages are expected to decline further, says the Usha Ananthasubramanian, Managing Director and CEO Of the bank.

The recovery for Q3 was set at Rs 2,413 crore and upgradation was at Rs 1,534 crore. The recoveries have been more in line with the earlier provided guidance, says Ananthasubramanian.

She adds that the bank may allot another Rs 5,000 crore for recoveries and upgradations for Q4. The recovery guidance for the year given by the bank earlier, was Rs 20,000 crore.

The non-performing asset situation for PNB would have been much better had it not been for demonetisation, she says.

2:32 pm Market update: Benchmark indices extended losses in last hour of trade. The Sensex was down 115.47 points at 28323.81 and the Nifty fell 34.75 points to 8766.30.

2:25 pm Earnings: State-run power equipment maker BHEL's third quarter earnings surpassed analysts' subdued expectations on all counts. Profit for the quarter stood at Rs 93.5 crore against loss of Rs 1,085 crore in year-ago quarter.

Revenue during the quarter increased 18.7 percent to Rs 6,325.4 crore compared with Rs 5,327.2 crore in corresponding quarter of last fiscal.

Earnings were far ahead of analysts' estimates. Profit was expected at Rs 31 crore on revenue of Rs 6,220 crore and operating profit was estimated at Rs 72 crore with margin at 3.5 percent for the quarter, according to analysts polled by CNBC-TV18.

2:15 pm Fund raising: India Inc raised about Rs 46,000 crore through private placement of corporate debt bonds in January, taking the total to a staggering Rs 5.25 lakh crore during 10 months of the current fiscal.

The funds have been raised for business expansion, to repay loans and meet working capital requirements.

In debt private placement, firms issue debt securities or bonds to institutional investors to raise capital.

According to the data available with the Securities and Exchange Board of India (Sebi), companies garnered Rs 45,957 crore in January this year, compared to Rs 59,587 crore in the preceding month.

2:00 pm Market Check
The market remained moderately lower amid volatility in afternoon, weighed by profit booking ahead of outcome of monetary policy committee meeting due on February 8.

The 30-share BSE Sensex declined 74.01 points to 28365.27 and the 50-share NSE Nifty fell 19.90 points to 8781.15. The broader markets erased all morning gains, trading flat.

Nifty PSU Bank gained nearly a percent after improvement in asset quality of Punjab National Bank, the country's third largest public sector lender by market capitalisation. SBI and Bank of Baroda are also going to announce their quarterly earnings on February 10.

PNB, SBI, ITC, UPL, Indiabulls Housing, Jindal Steel and BHEL were most active shares on bourses.

Ceat fell 3 percent after weak earnings. Profit declined 25 percent to Rs 83.8 crore and operating profit margin contracted by 280 basis points to 9.8 percent in Q3 YoY.

Markets in Europe were hovering around the flatline as earnings and data continue to be the main focus for investors.

1:40 pm Border tax: The US Republicans' plans to introduce a Border Adjustment Tax is going to be counter-productive for America and may never come to fruition, says Arun Kumar, Executive Vice Chairman and Managing Director at Strides Shasun .

"Things will remain status quo and the Indian generics business will continue to grow," he says.

Even if it is introduced, Strides has an exposure of only USD 100 million in the US and so will not be a big hit to company's sales, Kumar adds.

Going forward, the pharma company is going to to focus on its B2C business and the high cash generating verticals, he says.

1:30 pm Interview: IOC, the country's largest refiner, expects its crude processing to inch up in 2017/18 despite planned maintenance at some plants.

The company's head of refineries told Reuters in an interview late on Monday that "high runs" at one of its biggest plants, on the east coast, would offset the impact of maintenance work at other facilities.

IOC, which accounts for over a third of India's 4.6 million barrels per day (bpd) of refining capacity, is likely to process 1.4 million bpd in the fiscal year that starts in April, said Sanjiv Singh. That would be up from 1.34-1.36 million bpd in the current year.

IOC plans to completely shut its 160,000 bpd Mathura refinery in northern India for a month for planned maintenance in 2017/18, Singh said, without specifying when that would happen.

1:20 pm Auto sales: Tata Motors-owned Jaguar Land Rover (JLR) today reported its best-ever retail sales for January at 47,693 units, up by 4 percent from the same month of 2016.

The month's performance has been driven by the success of Jaguar F-PACE, XF, Land Rover Discovery Sport and the Range Rover Sport, JLR said in a statement.

The Jaguar brand recorded retail sales of 13,949 units in January, up 76 percent, driven by continuing strong sales of the F-PACE and strong demand for the long wheel base Jaguar XFL in China.

Land Rover recorded sales of 33,744 units in January, down 11 percent from January 2016, as continuing solid sales of the Land Rover Discovery Sport and Range Rover Sport were outweighed by discontinuation of Land Rover Defender and Discovery models, the company added.

1:00 pm Market Check
The market continued to consolidate with a negative bias in afternoon trade as investors awaited the outcome of two-day monetary policy committee meeting due tomorrow.

Edelweiss foresees a 25bps cut in repo rate in the forthcoming monetary policy review on February 8.

"The domestic macroeconomic backdrop remains one of benign inflation (with CPI likely to undershoot RBI's indicative trajectory), continued fiscal consolidation (fiscal impulse is modestly negative) and sustained weakness in private capex. At the global level, though uncertainty persists, the situation still offers space as Federal Reserve is not in a hurry to raise rates immediately and the USD is showing a weakening bias. Moreover, the INR is also overvalued. This backdrop warrants a 25bps rate cut," the research firm reasons.

The 30-share BSE Sensex was down 62.49 points at 28376.79 and the 50-share NSE Nifty fell 18.25 points to 8782.80 as oil and auto stocks were under pressure.

Punjab National Bank rallied 3.5 percent on fall in slippages & provisions and improvement in asset quality.

Amtek Auto shares gained 11 percent after sources told CNBC-TV18 that the auto ancillary company is expected to close asset monetisation deals by March 2017 and is likely to raise USD 1 billion via asset monetisation that may result in debt reduction of Rs 6,000-7,000 crore.

12:41 pm Buzzing: Domestic rating agency ICRA shares rallied nearly 7 percent as its board of directors will meet later this week to consider a proposal for buy-back of equity shares of the company.

"...Board meeting of the company scheduled to be held on February 9, 2017 ... At the said meeting, the Board will also consider a proposal for buy-back of the equity shares of the company," Icra said in a regulatory filing.

The company, however, did not elaborate on the size of the buyback. It will also announce its quarterly result on the said date.

12:20 pm Fitch on oil cos' merger: The proposed merger of state-owned oil companies could reduce inefficiencies across the sector and create an entity better placed to compete globally for resources, Fitch Ratings said today.

"However, a merger would face significant execution challenges, particularly in terms of managing the integration of employees, addressing overcapacity in the merged entity, and winning the backing for the merger from private shareholders," the rating agency said in a statement.

More than 12 years after a proposal to merge oil PSUs was first mooted by the then Oil Minister Mani Shankar Aiyar, Finance Minister Arun Jaitley in his Budget for 2017-18 last week, proposed to "create an integrated public sector 'oil major' which will be able to match the performance of international and domestic private sector oil and gas companies."

12:00 pm Market Check
Benchmark indices remained moderately lower in noon trade, with the Nifty struggling below 8800 level amid consolidation ahead of monetary policy committee decision due tomorrow.

The 30-share BSE Sensex was down 54.84 points at 28384.44 and the 50-share NSE Nifty fell 18.15 points to 8782.90.

The ongoing stock market rally is driven by fund flows but has little support from fundamentals, Pramod Gubbi of Ambit Capital said.

He further said he would prefer to wait for a turnaround in earnings.

Punjab National Bank shares gained nearly 3 percent after fall in slippages to Rs 4,800 crore and stable asset quality in Q3.

Hexaware Technologies climbed over 2 percent on better-than-expected earnings in the quarter ended December 2016.

ITC, ICICI Bank, Asian Paints, SBI, NTPC, BHEL and Tata Steel were gainers while Tata Motors, Reliance Industries, HDFC Bank, M&M, Adani Ports and Bajaj Auto were under pressure.

Oil firmed after falls the previous session, with markets torn between mixed price indicators that have kept crude range-bound for much of the year. Brent crude futures, the international benchmark for oil prices, were trading at USD 55.88 per barrel, up 0.29 percent from the last close.

11:58 am Results: Midcap software firm Hexaware Technologies said profit in fourth quarter grew by 9 percent to Rs 121.5 crore compared with Rs 111.4 crore in previous quarter. It was driven by forex gain and better-than-expected revenue & operational performance.

Rupee revenue during the quarter increased 4.1 percent sequentially to Rs 941 crore and dollar revenue rose by 2.7 percent to USD 138.9 million.

EBIT (earnings before interest and tax) was up 3.4 percent at Rs 148.3 crore, with margin contraction of 10 basis points at 15.7 percent compared with previous quarter.

Hexaware earned forex gain of Rs 12.5 crore in the quarter ended December 2016 against Rs 6.3 crore in September quarter.

11:35 am Earnings estimates: Watch and jewellery maker Titan Company's third quarter profit is expected to be flat at Rs 225.1 crore compared with year-ago quarter, impacted by demonetisation.

Revenue during the quarter is seen rising 6 percent year-on-year to Rs 3,633.88 crore and operating profit may grow 7 percent to Rs 332 crore, according to average of estimates of analysts polled by CNBC-TV18.

Margin is expected to be flat at 9 percent on year-on-year basis.

Jewellery business is likely to grow by 10 percent. Golden Harvest Scheme may support revenue growth.

11:20 am Coal scam: Former Coal Secretary H C Gupta was granted bail by a special court here in connection with a case related to alleged irregularities in allocation of a Chhattisgarh-based coal block to SKS Ispat and Power Ltd (SIPL).

Besides Gupta, who is already facing prosecution in over seven cases related to the coal scam, the court also granted the relief to senior public servant K S Kropha, firm's two directors Anil Gupta and Deepak Gupta, and three others -- Amit Singh, Rakesh Singh and Jagan Nath Panda -- in the case All the seven accused persons were granted the bail on a personal bond of Rs one lakh and one surety of like amount.

The accused persons and the firm were summoned by the court for allegedly misrepresenting the facts before the Screening Committee in relation to the land and net worth of company.

11:00 am Market Check
Equity benchmarks continued to trade lower in morning, tracking negative Asian cues and due to profit booking. Investors turned cautious ahead of monetary policy committee decision due tomorrow.

The 30-share BSE Sensex was down 73.04 points at 28366.24 and the 50-share NSE Nifty fell 24.15 points to 8776.90 while the market breadth was moderately positive.

Tata Motors fell more than 2 percent after a 4 percent growth in JLR total retail sales at 47,693 units in January year-on-year.

Hexaware Technologies gained 2 percent as quarterly earnings beat analysts' expectations. Profit in Q3 grew by 9 percent and revenue by 4 percent QoQ.

BHEL shares climbed 2.7 percent ahead of quarterly earnings due later today. A CNBC-TV18 poll expects profit at Rs 31 crore against loss of Rs 1,100 crore in year-ago quarter.

ITC was off day's high, up 0.9 percent after the government sold 2 percent stake in opening trade today. The government held 11.12 percent stake in the cigarette major through SUUTI.

10:40 am Earnings estimates: Tata Steel is expected to report consolidated profit at Rs 100 crore for the quarter ended December 2016 compared with Rs 2,127 crore in same quarter last year, driven by operational performance.

Revenue during the quarter is seen rising 3.4 percent to Rs 29,000 crore on year-on-year basis, according to average of estimates of analysts polled by CNBC-TV18.

Operating profit (EBITDA - earnings before interest, tax, depreciation and amortisation) is likely to grow 299.5 percent to Rs 3,100 crore and margin may expand 790 basis points to 10.7 percent compared with year-ago quarter.

10:25 am Market Expert: The ongoing stock market rally is driven by fund flows but has little support from fundamentals, Pramod Gubbi, Head of Equities at Ambit Capital, told CNBC-TV18 Tuesday.

He added that the US dollar was likely to not strengthen further, something that would help keep flows intact.

But he said that he would prefer to wait for a turnaround in earnings.

"The worst is not behind us," Gubbi said, discussing the impact of demonetisation on earnings. "You could see lot more earnings downgrades coming through. The impact could be spread out over a couple of quarters."

10:00 am Market Check
Benchmark indices continued to fall amid consolidation in morning, dragged by profit booking ahead of outcome of two-day monetary policy committee due tomorrow.

The 30-share BSE Sensex was down 45.10 points at 28394.18 and the 50-share NSE Nifty fell 14.90 points to 8786.15 while the broader markets outperformed benchmarks again.

The BSE Midcap and Smallcap indices were up 0.4 percent each on positive breadth. About 1241 shares advanced against 892 declining shares on the exchange.

Jayant Manglik of Religare Securities says markets look bit stretched now so it's prudent to book some profits and lighten up before the RBI's monetary policy review.

Also, the Nifty is now closer to 8900 hurdle so consolidation is more likely in near future, he feels.

ITC erased some gains on profit booking after rising more than 5 percent in early trade due to 2 percent stake sold by the government through SUUTI in opening. The stock was up 0.6 percent.

BHEL shares gained 2.8 percent ahead of quarterly earnings due later today. A CNBC-TV18 poll expects profit at Rs 31 crore against loss of Rs 1,100 crore in year-ago quarter.

Tata Motors, ICICI Bank, Mahindra & Mahindra and Bajaj Auto were down 1-2 percent followed by Reliance Industries, HDFC Bank and Infosys.

9:49 am FII View: Neelkanth Mishra of Credit Suisse says India is the fifth-best performing market in 2017 (so far) globally. In the first five weeks of 2017, Indian equities have outperformed global equities by 10 percent, nearly reversing the underperformance in November-December 2016.

This has mostly been driven by relative P/E jumping from a near 10-year low of negative 1 percent to positive 5 percent now, he feels.

Mishra remains constructive on narrower indices, given their significant global exposure and past positive correlation with commodity prices.

He will look through distortions induced by strong flows in a market with disoriented expectations, and continue to prefer businesses with non-India exposure.

9:31 am Stake sale: ITC shares gained 5 percent after government confirmed that it sold 2 percent shareholding in the company via block deals.

It is a part of FY17 divestment target of Rs 45,500 crore that has been revised recently from Rs 56,500 crore earlier.

The government, which held 11.12 percent stake (as of December 2016), is likely to get around Rs 6,700 crore through stake sale.

9:15 am Market Check
The market opened moderately lower on Tuesday as investors awaited monetary policy committee decision due tomorrow.

The 30-share BSE Sensex was down 11.54 points at 28427.74 and the 50-share NSE Nifty fell 8.35 points to 8792.70.

BHEL, ITC, Sun Pharma, Wipro, GAIL, Aurobindo Pharma and IndusInd Bank were early gainers while Dr Reddy's Labs, ICICI Bank, Bharti Airtel, Axis Bank, ONGC, ACC and Eicher Motors were under pressure.

The Indian rupee has started off the day on a weak note with all eyes on RBI policy tomorrow. The currency opened at 67. 29 per dollar, a loss of 8 paise against yesterday's closing of 67.21 per dollar.

Bhaskar Panda of HDFC Bank says the dollar index has been trading in and around 100 pivot and apart from this fundamental factor, the rupee has been gaining due to positive impact of the Budget.

According to him, the USD-INR pair is expected to trade in a range of Rs 67.10-67.30 for today.

Panda says the market is evenly divided on the expectations of rate cut in the policy tomorrow.

Asian markets were negative following the sluggishness in global equities amid risk-off sentiment.