Sensex loses 221 points, Nifty ends below 9200 after US cruise missile strike on Syria
07 April 2017
3:30 pm Market Closing: Benchmark indices closed sharply lower after the US launched dozens of cruise missiles against an airbase in Syria.
The 30-share BSE Sensex was down 220.73 points at 29,706.61 and the 50-share NSE Nifty fell 63.65 points to 9,198.30, dragged by energy, pharma, FMCG and select banks stocks.
3:24 pm Rupee at 20-month high: The Indian rupee hit a more than 1-1/2 year high after the Reserve Bank of India (RBI) held its policy rate and expressed concerns about inflation, raising expectations it would no longer cut rates this year, while bonds fell and shares edged lower.
The RBI held the repo rate at 6.25 percent on Thursday, as widely expected, and raised its inflation forecasts, increasing expectations it could even tighten should prices accelerate.
Before the meeting, 21 of 34 economists had predicted stable prices would allow the RBI to cut rates this year.
The rupee strengthened to as much as 64.28 per dollar, its highest since August 2015, after also rallying on Thursday. It was last trading at 64.23 compared with Thursday's close of 64.52.
3:02 pm Fundraising: Reliance Capital has increased the limit on issuance of non-convertible debentures (NCDs) to raise funds by Rs 3,000 crore.
The board of directors today decided to hike the limit for NCD issues on private placement basis by an amount of Rs 3,000 crore, Reliance Capital said in a regulatory filing.
With this, the overall borrowing limits under NCDs stands increased to up to Rs 18,000 crore, sources said.
The company said it can raise the increased sum of Rs 3,000 crore in one or more tranches from time to time.
2:52 pm Market Update: Equity benchmarks extended losses in last hour of trade, with the Sensex falling 184.75 points to 29,742.59 but the Nifty continued to hold 9200, down 53.15 points at 9,208.80.
2:44 pm JP Morgan on Avenue: JP Morgan has initiated coverage on Avenue Supermarts with a neutral rating and March-18 price target of Rs 635.
ASL (operates stores under D-Mart brand), with a strong execution track record, is a quality play on the Indian F&G retail sector, being the fastest-growing and most profitable retailer, according to the research house.
It forecasts 27 percent/34 percent revenue/EPS CAGR over FY17-20. However, significant gains post the listing (120 percent above the offer price) lead to current valuations of 55x/42x FY18E/19E P/E, which fairly reflect the long-term growth opportunity, it feels. Any minor lapse near term (store opening, comps, and/or margins) and substantial investments in E-Commerce (earnings dilutive) could strain valuation multiples, it says.
2:35 pm Buzzing stock: Shares of SMS Pharmaceuticals rose nearly 7 percent intraday as it increased its investment in VKT Pharma.
The company has further invested an amount of Rs 2.7 crore by subscribing 1,20,000 equity shares of face value of Rs 10 each at a price of Rs 225 per share.
2:15 pm Market Check: Amid geopolitical tensions on the back of US' action against a Syrian air base, the market was in the red but held steady.
The Sensex was down 54.19 points at 29873.15, while the Nifty was down 13.75 points at 9248.20. About 1,597 shares advanced against a decline of 1,169 shares, while 140 shares are unchanged.
L&T, Bharti Airtel, BPCL and IOC were the top gainers, while Sun Pharma and Lupin were the top losers.
1:55 pm ONGC sees natural gas output at 5-year high: Oil and Natural Gas Corp expects its natural gas production to reach a 5-year high in the current fiscal year following the start-up in coming weeks of a long-delayed project in the Arabian Sea, two senior company executives said.
State-owned ONGC, which accounts for about two-thirds of India's total natural gas production, is likely to produce close to 25 billion cubic metres (bcm) of gas in fiscal 2018, the executives told Reuters.
1:40 pm Europe opens: Bourses in Europe were mostly lower after the US fired cruise missiles against an air base in Syria, raising concerns of an escalating conflict in the region.
1:20 pm Oil Update: Oil prices surged more than 2 percent after the United States launched dozens of cruise missiles at an airbase in Syria.
After tepid trading before the news, Brent crude futures, the international benchmark for oil, jumped to $56.08 per barrel before easing to be up 1.77 percent at USD 55.81 per barrel.
US West Texas Intermediate (WTI) crude futures also climbed by over 2 percent, to a high of USD 52.94 a barrel before receding to be up 1.8 percent at USD 52.61.
1:00 pm Market Check: Equity benchmarks remained moderately under pressure amid consolidation in afternoon, dragged by index heavyweights Reliance Industries (down 1.14 percent), Infosys (down 1.2 percent), ICICI Bank (down 1.05 percent) and ITC (down 0.44 percent).
The market seems to have priced in the news of US launched dozens of missiles into Syria. Investors awaited fourth quarter warnings and outlook for FY18, which is likely to be strong, feel experts.
The 30-share BSE Sensex was down 73.22 points at 29,854.12 and the 50-share NSE Nifty fell 22.50 points to 9,239.45. The market breadth improved further as about 1493 shares advanced against 1176 declining shares on the BSE.
The broader markets outperformed benchmarks on positive breadth, with the BSE Midcap and Smallcap indices rising half a percent each.
L&T (up 1.74 percent), HDFC Bank (up 0.4 percent), TCS (up 0.5 percent), Bharti Airtel (up 1.7 percent) and Tata Motors (up 0.26 percent) continued to support the market.
12:46 pm MF performance: MFs saw a huge gush of liquidity in the last 12 months and this is evident from the average assets under management (AAUM) of 42 fund houses which has swollen to Rs 18.3 lakh crore, an all-time high, compared to Rs 13.5 lakh crore as of March 2016.
The top performing theme of FY17 was smallcap theme which gave 40 percent return to investors followed by midcap theme which gave 33 percent, banking which delivered 45 percent and largecap MFs gave 24 percent return. The S&P BSE Sensex rose by about 17 percent in the same period.
12:27 pm Pricing war continues: As telecom operators jostle to provide more data and perks to consumers to claim the top spot, Idea Cellular has announced its 'Data Jackpot' offer wherein postpaid Idea customers will get up to 10GB data each month, at a nominal rental of Rs 100, via the My Idea App.
As per the Data Jackpot offer, Idea will offer 10GB data per month for the first three months. Users will get 1GB data at the same price after the first three months are over.
Telecom operators in the country in a stiff tariff war since Reliance Jio made a foray in last September. Jio introduced a series of offers like - Happy New Year offer and Jio Prime plan, and recently announced a new offer called Summer Surprise. The Summer Surprise, which requires a user to take Jio Prime membership and do a recharge of Rs 303 or higher, extends free Jio services for another three months.
12:15 pm Market Check: Benchmark indices continued to trade in the red zone even as it trimmed morning losses as geopolitical tensions escalated.
The Sensex was down 84.56 points at 29842.78, while the Nifty was down 25.15 points at 9236.80. The market breadth was narrow with 1,439 shares having advanced against a decline of 1,122 shares, while 140 shares are unchanged.
Bharti Airtel, Larsen and Toubro and Indian Oil were top gainers on both indices, while Sun Pharma, Coal India and Bank of Baroda were top losers.
12:05 pm Buzzing Stock: Shares of Reliance Communications fell nearly 3 percent intraday as investors turned cautious of reports of operational trouble in the firm.
Moneycontrol had reported that the company retrenched nearly 800 employees in the last few weeks, including some senior ones, as it battles falling revenues and profits.
The company has also not been making payments to vendors and other telecom companies on time. Vendors claim that Reliance Communications has not been paying interconnect usage charges to some of them for more than two months.
11:45 am Management Speak: New residential project launches would get impacted in the first quarter of the financial year due to the implementation of new rules (GST rollout RERA), so the demand for available inventory and ready-to-move-in homes will, therefore, increase.
This is the perfect time to buy property, Surendra Hiranandani, Chairman & Managing Director, House of Hiranandani said in an interview to moneycontrol's Sarbajeet K Sen. You can read the full report here.
11:31 am Bank deposits investors' no. 1 choice: About 78 percent of Indians are comfortable calling in a broker to place their trades, while only 22 percent are savvy enough to use the internet to invest, finds a report commissioned by the capital market regulator Securities & Exchange Board of India (SEBI) and conducted by Nielsen.
The study, which gauges the investing habits and outlook of retail investors, also revealed that rural India still prefers fixed deposits. A startling find, however, was the fact that less than 1 percent of the total value has been invested in these instruments as a result of poor awareness.
11:20 am Jio to hurt earnings of telcos: Free services offer from Reliance Jio will hurt the earnings of telecom operators for three months ended March 2017, pushing down mobile revenues by 6.5-7.5 percent on quarter-on-quarter basis, says a report.
Moreover, the RJio's extended free services for prime members till June, may also continue to keep the performance of telecom companies muted for the first quarter (April-June) of the current fiscal, according to ICICI Securities' latest earnings preview
of the sector.
"Fourth quarter (January-March) of 2016-17 performance of telecom operators would be impacted by the free services offer from Reliance Jio (RJio) on the higher subscriber-base as well as the reset of higher-value average revenue per user (ARPU) subscribers with higher allowances on lower packs by Bharti Airtel and Idea Cellular," the report said.
(Disclaimer: Reliance Jio is a part of Reliance Industries that owns Network 18 Media & moneycontrol.com)
11:05 am Market Check: Amid geopolitical tensions after the US' missile strikes in Syrian bases, the market trimmed morning losses. The Street now is looking for cues on the GST passage front as well as awaited earnings, which will set the tone going forward.
The Sensex was down 62.64 points at 29864.70, while the Nifty was down 17.35 points at 9244.60. The market breadth was in the positive, but narrow as 1,423 shares advanced against a decline of 983 shares, while 102 shares were unchanged.
Bharti Airtel, Larsen and Toubro, Indian Oil and BPCL were the top gainers, while Sun Pharma and Adani Ports were the top losers on both indices.
10:56 am Management Speak: In an interview to CNBC-TV18, Keki Mistry, VC & CEO of HDFC said it was expected that the monetary policy would be neutral and the RBI's focus would be on inflation. However, he is hopeful of seeing a 25 basis points rate cut by RBI in the next 3-6 months.
He said inflation is an important factor which has to be watched out for especially since one is still uncertain about monsoon and there is also the possibility of impact from farm loan waiver. If the monsoon is poor, then inflation risk will rise, said Mistry.
10:38 am Buzzing Stock: Shares of Ashoka Buildcon gained nearly 10 percent intraday on Friday as investors cheered its award win for develop land parcels in Mumbai.
The company received a Letter of Award ('LoA') from Mumbai International Airport (MIAL) for developing the land parcels located at NS-C02 and NS-C03 in CTS No. 145-A (Part) of Village Sahar ('GVK SKY City Project') located near existing Chhatrapati Shivaji International Airport, Mumbai.
This is for development of commercial or office space of potential built up area of 108,494 sq. metres. (1.17 mn Sq. Ft.) for an aggregate lease period of 49 years, it told in a notification to the exchanges.
10:20 am FII View: Laurence Balanco of CLSA says the India re-rating continues. In absolute terms the Nifty continues to work its way higher following the breakout to new all-time highs with the move above 8,989-9,191 resistance, he adds.
"On the upside we are focused on targets stretching from 10,350 to 12,000," he says.
10:00 am Market Check: Benchmark indices recouped some early losses following recovery in Asia as investors digested the news of missiles fired into Syria by US.
The 30-share BSE Sensex was down 84.87 points at 29,842.47 and the 50-share NSE Nifty fell 29 points to 9,232.95.
The Indian rupee touched 19-month high of 64.37 against the US dollar, up 14 paise as dollar weakened further amid geopolitical tensions. Oil prices surged more than 2 percent.
Telecom, infra, auto and select banks stocks gained strength whereas Reliance Industries, HDFC and ITC remained under pressure.
Experts are not worried about these issues as risk appetite of investors is rising.
ICICI Securities believes Indian equity will trade above long term average and a sharp correction in Nifty is unlikely anytime soon as FPI flows are expected to persist and DII flows are expected to remain robust.
9:53 am Market Expert: As equity benchmarks climb to fresh record highs, skeptics have raised concerns on the fundamentals of the rally and whether earnings growth will see a pick up or not.
But Enam Holdings is upbeat on earnings growth and believes that it will grow 20 percent in the next year as interest rate transmission will have an impact on them. Results in the previous quarter (Q3) weren't bad either, Sridhar Sivaram, Investment Director at Enam Holdings told CNBC-TV18 in an interview. In fact, earnings going forward will surprise the Street.
''There are good times ahead…the market will continue to climb the walls of worry,'' he told the channel.
9:45 am RBI eyes monsoon: The Reserve Bank of India would keenly watch the progress of monsoon this year before taking a policy call.
Motilal Oswal believes that if monsoon remains normal, then headline inflation for FY18 would be around 4.5 percent, triggering a status quo on rates or even a rate cut. On the other hand, if monsoon disappoints, then inflation levels could be around 5 percent or slightly higher for FY18, making way for a rate hike.
9:33 am Interview: Sajjan Jindal-led JSW Steel said it is "capable" of spending up to USD one billion (around Rs 6,500 crore) per annum on both capacity expansion and acquisitions.
The company is also planning to bid for iron ore and coking coal mines in the upcoming auctions, JSW Steel Joint MD and Group CFO Seshagiri Rao said.
"We are capable of spending up to USD one billion per annum without increasing debt on capacity expansion and acquisitions," Rao said.
The company would participate in the auctions of two iron ore mines in Odisha, he said adding that JSW Steel would also bid for coking coal mines in Jharkhand.
9:15 am Market Check: Equity benchmarks opened sharply lower Friday on weak global cues after the US fired dozens of cruise missiles into Syria.
The 30-share BSE Sensex was down 149.99 points at 29,777.35 and the 50-share NSE Nifty fell 47.30 points to 9214.65.
Reliance Industries share price fell 1.6 percent on profit booking post TRAI order, but the stock recovered a bit. (Disclosure: Reliance Industries, the parent company of Reliance Jio, owns Network 18 and Moneycontrol.com)
Sun Pharma was the biggest loser among Sensex stocks, down 2 percent followed by HDFC, ITC, Adani Ports, Tata Motors, HDFC Bank and Infosys.
Bharti Airtel gained 2 percent. Maruti Suzuki, ICICI Bank, TCS, Axis Bank and ONGC were other gainers.
Asian markets and stock futures in the US turned negative after the US fired missiles into Syria. Crude prices spiked 2 percent and the dollar weakened slightly.
Meanwhile, the Indian rupee opened lower by 18 paise at 64.69 per dollar versus previous close 64.51.
Ashutosh Raina of HDFC Bank said, "The USD-INR pair breached the crucial technical level of 64.80/dollar, after the RBI maintained status quo in repo rate. The strong portfolio flows continue to help the pair."
He expects a trading range of 64.30-64.80/dollar in the near term, with RBI expected to support at lower levels.