Nifty ends above 8900, Sensex rises 100 points; Axis Bank jumps 5%
21 February 2017
3:30 pm Market Closing: Equity benchmarks retained its uptrend for the second consecutive session Tuesday, especially led by banks post Axis Bank merger talks and Reliance Industries after Reliance Jio tariff plans.
The 30-share BSE Sensex was up 100.01 points at 28761.59 and the 50-share NSE Nifty gained 28.65 points at 8907.85 but the market breadth was not that strong.
About 1553 shares advanced against 1277 declining shares on the Bombay Stock Exchange.
Axis Bank surged 5 percent after sources told CNBC-TV18 that Kotak Mahindra Bank informally approached government seeking Axis Bank's hand.
3:13 pm Interview: The bank's executive director RK Gupta confirmed the report and told CNBC-TV18 that the aim of the strategy is to boost operating profits by cutting operating expenditure, and ease capital.
The exercise to identify the branches to be merged is still underway and there are no plans to merge rural branches, Gupta informed.
There are around 1,940 branches and around 300 branches are loss-making ones, he added.
3:00 pm Market Update: Equity benchmarks as well as broader markets gained strength in last hour of trade after Axis Bank merger talks gathered steam.
The 30-share BSE Sensex rose 75.01 points to 28736.59 while the Nifty surpassed 8900 level, up 22.45 points at 8901.65.
The Nifty Midcap hit a record high 16479.40, up nearly a percent.
2:55 pm Axis Bank merger?: Sources told CNBC-TV18 that Kotak Mahindra Bank informally approached government seeking Axis Bank's hand.
Its informal offer sparked interest from other private banks for Axis Bank, sources say.
Bankers, industry leaders reached out to government informally showing interest in Axis bank. HDFC Bank, HDFC, ICICI Bank and IndusInd Bank approached government informally w.r.t Axis Bank.
CNBC-TV18 reached out to Axis Bank, Kotak Mahindra Bank, HDFC & government officials.
HDFC Bank said it did not comment on speculation. Kotak said it won't comment on rumours while Axis Bank strongly denied merger talks.
Key secretaries in finance ministry said they had not heard of any deal talks on Axis Bank.
2:50 pm NBFC license: The Reserve Bank of India has granted a non-banking finance company license to company's wholly owned subsidiary APM Finvest.
The board of directors of the company had in meeting held on January 29, 2016 decided to enter into the business of finance, lending and investment business through a wholly owned subsidiary and hence the company incorporated APM Finvest and applied for the NBFC license.
APM Industries shares surged more than 11 percent intraday.
2:40 pm Buzzing: Bank of Maharashtra shares rallied nearly 19 percent intraday after CNBC-TV18 reports quoting Cogencis that the bank merge branches & cut zonal offices in FY18.
The public sector bank may merge 450-500 loss-making branches in next financial year.
2:35 pm Credit Suisse says it likes Tech Mahindra as the revival in growth momentum is already visible and valuations are attractive. The stock gained 2 percent.
2:30 pm Economic growth: India's millennial population is a massive disruptive force and driven by this supportive demographics alongwith government's policy action, Indian economy is likely to reach USD 5 trillion by 2025, says a report.
India's USD 2.2 trillion economy makes it the seventh largest in the world in terms of nominal GDP (and the third largest in PPP terms), but the country's per capita income is less significant.
With a per capita income of USD 1,700, India ranks well behind some of the key emerging markets, like China, Russia, Brazil, Indonesia, the Philippines, Mexico, and Turkey.
"We expect a confluence of supportive factors, led by demographics, government policy action, and globalisation, to lead to a sustained period of productive growth in the medium term," Morgan Stanley said in a research note adding "in our base case, we expect the Indian economy to reach USD 5 trillion by FY2025.
2:25 pm Divestment: IDBI Bank shares gained little more than one percent intraday after the board approval for divestment of non-core investments.
"The board of directors of the bank, on February 21, has approved in-principle, the proposal to divest some of its non-core investments," the state-run lender said in its filing.
The divestment is subject to compliance with all applicable laws and regulations and subject to final approval to be obtained for each transaction by Delegated Authority.
Analysts were hoping for some news on privatisation of the bank as the government indicated in the Union Budget 2017 but that did not discuss in this board meeting.
2:23 pm IOB gets new ED: Public sector Indian Overseas Bank today said K Swaminathan has been appointed as its Executive Director with immediate effect.
"In its notification, Government of India appointed K Swaminathan as Executive Director of our Bank and he assumed charge on February 17", the city-headquartered bank said in a BSE filing.
2:21 pm USFDA inspection: Aurobindo Pharma shares gained more than 3 percent after sources told CNBC-TV18 that unit 11 inspection completed today with zero observations by US Food & Drug Administration.
Unit 11 is the largest API plant and is used primarily for captive consumption.
2:16 pm Ambani says Jio will cover 99 percent of India's population by 2017-end.
The company has been building 'Jio true 4G' network for the past 6 years and has doubled Jio's 4G stations as compared to peers in the market.
Ambani says Reliance will more than double Jio's data capacity.
2:14 pm Idea Cellular fell 0.5 percent and Bharti Airtel lost 2 percent after Mukesh Ambani speech on future plans of Reliance Jio. However, Reliance Communications gained nearly 3 percent.
2:11 pm Reliance CMD Ambani says Jio prime members will get bouquet of Jio media services till March 31, 2018.
2:10 pm Jio prime members will continue to enjoy Happy New Year Offer at Rs Rs 303 per month.
2:07 pm Jio prime members will avail new year scheme benefits for another 12 months after enrollment for prime membership from March 1 at Rs 99, says Ambani.
2:06 pm Reliance Jio consumers consumed more han 100 crore GB data last month.
2:05 pm Mukesh Ambani says calls to all networks will remain free even after March 31.
2:03 pm Reliance Jio will start offering tariff plans starting from April 1 after the end of free services on March 31.
2:02 pm Reliance Jio has crossed 100 million subscribers in 170 days, which means it added nearly 7 customers every second in these days.
2:00 pm Market Check
Benchmark indices remained directionless in afternoon trade ahead of expiry of February futures & options contracts on Thursday.
The 30-share BSE Sensex was down 4.17 points at 28657.41 and the 50-share NSE Nifty fell 2.40 points to 8876.80 but the market breadth remained in favour of advances.
About 1489 shares advanced against 1190 declining shares on the Bombay Stock Exchange.
Reliance Industries continued to support the market, up over 1 percent while Chairman and Managing Director speaking at Reliance Jio press conference.
Disclosure: Reliance Industries, the parent company of Reliance Jio, owns Network 18 that publishes Moneycontrol.com.
1:53 PM Reliance Jio surpasses key milestone: Reliance Jio has crossed 100-million customer mark in 170 days, said Mukesh Ambani, Chairman and Managing Director, Reliance Industries. Jio has added seven customers on an average every second in the last 170 days, Ambani added.
(Disclosure: Reliance Industries, the parent company of Reliance Jio, owns Network 18 that publishes Moneycontrol.com.)
1:45 PM Upbeat on Marksans Pharma: A successful Goa plant inspection by MHRA is a major positive for Marksans Pharma as it should enable the company to turnaround its key UK business, IDFC Securities says while retaining outperform rating on the stock. The share price rallied 7.6 percent intraday Tuesday (in addition to 20 percent upside in previous session).
Along with the expected pick-up in UK sales in the coming quarters, the company's ability to stay compliant with the USFDA norms and to keep increasing client penetration in the US as also securing new softgel ANDA approvals will be key to its recovery, the brokerage house feels.
Marksans Pharma, on February 20, announced that it has successfully completed UK MHRA inspection for its Goa facility without any critical observations. The company is now awaiting further instruction from the agency on the way forward.
1:22 PM Expert view: Even as the optimism around India is quite high, foreign investors are treading cautiously, choosing to wait for fourth quarter earnings before taking investment calls, said GV Giri, Head of Research at IIFL Institutional Equities, speaking to CNBC-TV18 from the sidelines of the 2-day IIFL Enterprising India Conference.
Foreign fund inflows that had dried up last year have started returning since the start of this calendar, he said.
Barring a couple of markets, India has outperformed most emerging markets this year, he noted.
On sector specific action, he felt that risks in the telecom space are gradually reducing and the industry will benefit from consolidation.
The market continued to remain sluggish in the post noon trade, riding on the volatility seen on the street before the expiry of derivative contracts for February series.
The 30-share Sensex fell 44 points to 28616.63, while the Nifty fell around 11 points at 8867.95. The market breadth was narrow after 1,443 shares advanced, 1,157 declined. Meanwhile 175 shares were unchanged.
Among top gainers on the Sensex and Nifty were Axis Bank, Asian Paints and Tech Mahindra, while Bharti Group cos, Airtel and Infratel, as well as TCS were the top losers on the index.
HDFC Bank and ITC were a drag after being the top negative contributors on the Sensex, while ITC and Bharti Infratel were the top negative contributors on the Nifty.
12:55 PM Open offer on cards? Diageo is going to finalise a plan on the open offer to shareholders of Indian liquor firm United Spirits this week, say sources close to the development.
The open offer will help hike Diageo's stake in USL. Diageo's global management team in India will take stock of its operations in India. Diageo CEO Ivan Menezes will meet bankers on the contours of USL's open offer.
The largest distiller of the world, Diageo, may also explore other options to hike stake in USL as well, including an OFS (offer for sale).
12:43 PM Expert Speak: The 50-share Nifty has had a phenomenal rally over the last eight weeks but Gautam Shah, Associate Director & Technical Analyst at JM Financial feels "markets are now at a major inflection point". He sees little possibility of indices hitting life time highs in the current run.
The Nifty could potentially make a short term top around 8900, and Shah believes if that happens, there could be a retracement all the way down to 8650 or even 8450-8500.
"Such retracement, if it happens, will help build a higher base and set the ball rolling for a move towards lifetime highs," he tells CNBC-TV18 in an interview.
12:28 PM Buzzing Stock: Shares of Bajaj Electricals soared over 4 percent intraday on Tuesday as investors cheered the company's decision to renew its licence to use 'Morphy Richards' trademark for five years.
''The company has as entered into a trademark licence agreement with Morphy Richards of United Kingdom to renew the exclusive license for use of trademark 'Morphy Richards' by the company in relation to the products procured from the manufacturers and/or imported from any other country for marketing the same in India and other countries, for a further period of five (5) years from April 25, 2017, on payment of royalty,'' the company informed in a notification to the exchanges.
Equity benchmark indices continued to see volatile movements in noon ahead of expiry of February derivative contracts on Thursday.
The 30-share Sensex was down 17.87 points at 28643.71 while the Nifty traded lower by 4.20 points at 8875.00. The market breadth was seen narrowing with 1,410 shares having advanced against 1,075 shares having declined.
HDFC Bank and ITC dragged the Sensex lower as they were the top negative contributors to the Sensex, while ITC and Bharti Infratel were the top negative contributors on the Nifty.
Bharti Airtel and ITC were the top losers on the Sensex. Bharti Group stocks Bharti Airtel and Bharti Infratel were the top losers. Axis Bank, Tech Mahindra and HUL were among the top gainers on Sensex and Nifty.
11:34 am PSU banks consolidation: Days after the Cabinet approved merging five associate banks with SBI, Finance Ministry officials said further consolidation in public sector banking may have to wait till bad loans situation improves.
The government may not like to go in for further consolidation in public sector banks till the NPA situation improves, sources said.
Merging PSU banks at their current health is not a good option as it has potential to undermine the performance of the merged entity, officials added.
Meanwhile, heads of the top 10 PSU banks, including SBI, PNB and BoB, had meeting with the Finance Minister where host of issues where discussed including current NPA situation, capital infusion and GST implementation from the banks' perspective.
11:17 am Market Expert: Even as the optimism around India is quite high, foreign investors are treading cautiously, choosing to wait for fourth quarter earnings before taking investment calls, says GV Giri, Head of Research at IIFL Institutional Equities speaking to CNBC-TV18 from the sidelines of the 2-day IIFL Enterprising India Conference.
Foreign fund inflows that had dried up last year have started returning since the start of this calendar, he says. Barring a couple of markets, India has outperformed most emerging markets this year, he noted.
11:00 am Market Check
Equity benchmarks were off day's high in morning, weighed by banking & financials, telecom and select FMCG & technology stocks. However, Reliance and Tata Motors continued to support the market.
The 30-share BSE Sensex was down 42.42 points at 28619.16 and the 50-share NSE Nifty fell 10.40 points to 8868.80.
The broader markets also were off day's high, rising 0.3 percent. The market breadth was positive as about 1336 shares advanced against 962 declining shares on the BSE.
ITC and Bharti Airtel were top losers among Sensex stocks, down 1-2 percent followed by HDFC Bank, Jindal Steel retained its top position in buying list among midcap stocks, up 8 percent in addition to 8 percent rally in previous session., M&M, Maruti, HDFC and Infosys.
Jindal Steel retained its top position in buying list among midcap stocks, up 8 percent in addition to 8 percent rally in previous session.
US crude futures rose for a second day today, with data showing hedge funds are betting big across oil markets following OPEC production cuts agreed last year. US West Texas Intermediate crude was up 0.47 percent at USD 53.65 a barrel.
Gold prices fell amid a rise in the dollar as investors awaited more clues on the timing of any US interest rate hikes in a series of speeches by Federal Reserve officials this week.
10:50 am Market Update: Benchmark indices erased early gains, weighed by ITC and HDFC Group stocks.
The 30-share BSE Sensex was down 43.70 points at 28617.88 and the 50-share NSE Nifty fell 8.80 points to 8870.40.
About 1339 shares advanced against 910 declining shares on the BSE.
10:47 am FII View: Markus Rosgen of Citi says Asia investors more focused on downside than upside risk.
During a week of discussions with investors in Asia, the overwhelming mood was caution, with the emphasis on what could go wrong as opposed to what could propel markets higher, he says.
The irony is that the performance and positioning data suggest the average portfolio would benefit rather than be hurt by market downside, he feels.
President Trump, a US border tax, the USD, China and Europe featured prominently in discussions, Rosgen says.
10:20 am Motilal on Ambuja: While Ambuja Cements' growth potential remains muted due to its limited expansion, Motilal Oswal believes better utilisation headroom in the fastergrowing regions (north and east) should offer some resilience.
Company's core strengths are intact, and its presence in the north and west markets could lead to meaningful realization improvement, it feels.
The brokerge house raised EPS estimates for CY17/CY18 by 6 percent to factor in better profitability.
It has maintained buy rating on the stock with a target price of Rs 277 (implying 16 percent upside) after Q4 earnings.
10:00 am Market Check
Benchmark indices remained in positive terrain, with the Nifty eyeing 8900 amid consolidation in morning. The broader markets continued to outperform benchmarks, with the BSE Midcap and Smallcap indices rising half a percent each.
The 30-share BSE Sensex rose 9.96 points to 28671.54 and the 50-share NSE Nifty gained 9.50 points at 8888.70. About two shares advanced for every share falling on the BSE.
Tata Motors and Tata Steel were top gainers among Sensex, up 1.6 percent each after Natarajan Chandrasekaran has taken a responsibility of Tata Sons by becoming a chairman of the Group. TCS also gained a bit after rising 4 percent in previous session due to share buyback.
Infosys retained upside in morning, up 0.7 percent on hopes of share buyback from the company. Reliance Industries gained 0.7 percent ahead of Reliance Jio's press conference later today.
Asian Paints, L&T, Axis Bank, SBI and ONGC were other gainers while ITC, HDFC Bank, Bharti Airtel, Maruti and Cipla were under pressure.
Disclosure: Reliance Industries, the parent company of Reliance Jio, owns Network 18 that publishes Moneycontrol.com.
9:56 am FII View: Neelkanth Mishra of Credit Suisse says cut to FY18 EPS were moderate, except in telecom, PSU banks, cement and discretionaries.
But FY18 expectations continue to be elevated as clarity emerges on the lasting implications of demonetisation and the timing and impact of the GST, he expects further cuts.
Mishra expects these in banking, cement, consumer discretionaries, and staples. He continues to believe that when the pace of cuts starts to outpace the roll-forward pace that the market starts to worry - this point may also be reached.
9:40 am Macquarie on TCS: While retaining its neutral call on the stock with a target price at Rs 2,408, Macquarie says investors could press for increase in payout ratio and expects FY18 EPS to rise over 1 percent but that may partly offset by lower other income.
According to Macquarie, clarity on client budgets is a key catalyst for the stock. It expects CY17 to be dominated by return of capital to shareholders and visa reform in US. Its pecking order in large cap IT players is HCL Technologies, Infosys, TCS, Tech Mahindra and Wipro.
9:28 am Buzzing: Shares of Siemens gained nearly 2 percent intraday as it has won an order worth Rs 287 crore.
The company with Siemens Rail Automation S.A.U Spain have jointly won an order worth Rs 287 crore, out of which Siemens' share is Rs 146 crore.
"The company is going to supply state-of-the-art signalling technology for the first two metro lines of the Nagpur Metro i.e. the North-South and the East-West Corridors," as per company release.
"The project comprises the deployment and installation of the Siemens communications-based train control (CBTC) solution Trainguard MT for 38.2 kilometers of double track with 36 stations and two depots, as well as onboard equipment for 23 three-cars trains," it added.
9:15 am Market Check
Equity benchmarks opened flat with a positive bias on Tuesday, with the Nifty inching towards 8900 level, led by technology, healthcare and metals stocks.
The 30-share BSE Sensex was up 34.26 points at 28695.84 and the 50-share NSE Nifty rose 13.05 points to 8892.25.
Infosys gained 1 percent on hopes of share buyback. Reliance Industries, Axis Bank, ONGC and Sun Pharma were other gainers while HDFC Bank fell 0.6 percent on profit booking.
Bharti Airtel, ITC, Maruti, Cipla and GAIL were other losers.
Ambuja Cements fell 2 percent after fourth quarter earnings. Profit grew by 59.9 percent on low base in year-ago period.
Markets in Asia traded mostly higher, as traders searched for direction following a public holiday in the US on Monday.
In Japan, the Nikkei 225 added 0.65 percent, while across the Korean Strait, the Kospi was up 1.06 percent.