Sensex ends off day's low on banks' support; IDBI jumps 14%
14 March 2018
3:30 pm Market Closing: Benchmark indices recovered sharply from day's low in last hour of trade, backed by banks.
The 30-share BSE Sensex was down 21.04 points at 33,835.74 and the 50-share NSE Nifty declined down 16 points to 10,410.90.
SBI, Axis Bank, ICICI Bank, Yes bank, Tech Mahindra, Ambuja Cements and Bajaj Finance gained up to 3 percent.
Tata Steel, IOC, HDFC and HPCL were down up to 3 percent.
IDBI Bank, OBC, Syndicate Bank, Andhra Bank, TV Today, Network 18, TV18 Broadcast, Zee Media, Jaiprakash Associates, Kwality, KPIT Technologies, Fortis Healthcare, Himadri Chemicals, United Spirits, VST Industries and Venky's gained up to 17 percent.
PFC, REC, Amtek Auto and Alok Industries fell up to 5 percent.
3:20 pm India Ratings' take on WPI inflation: Devendra Kumar Pant, Chief Economist and Senior Director (Public Finance), India Ratings & Research said wholesale inflation in February 2018 followed a declining trend of last two months, similar to the trajectory of retail inflation in February 2018. Decline was sharp in food articles (0.88% in February 2018 as against 3.00% in January 2018) largely due to decline in vegetables inflation. Manufactured products inflation increased in February 2018 mainly led by inflation of chemicals and chemical products, cement, line and plaster; basic metal and mild steel.
Rising core inflation from November 2017 and highest in last 42 months suggests demand revival in the economy. Going forward, the cyclical factors will provide comfort of low wholesale inflation till May 2018, however, after that due to favourable base effect waning and summer months starting will push food and headline inflation higher.
The worrying trend has been increasing divergence between consumer food price inflation as measured by CPI and wholesale food articles inflation as measured by WPI. The divergence increased to 238bp in February 2018 from 23bp in December 2017, in fact the divergence is highest in last 27 months. While decline in retail food inflation is good news for government and consumers, increasing divergence and sharp fall in wholesale inflation is synonymous with plight of farmers.
3:10 pm Management Interview: Despite a tough market scenario Arvind Lifestyle Brands which houses brands like Gap, Sephora and US Polo Association expects to hit revenues of Rs 5,000 crore by 2020.
I think it is a difficult and a peculiar year, things were very good till December. January onwards, market has been a bit tough, J Suresh, MD & CEO, Arvind Lifestyle Brands said.
We still will deliver more than 15 percent growth rate but it is a bit of a tough market condition more from the retail point of view, he added.
We are reaching Rs 4,000 crore of revenue this year and we were Rs 3,000 crore of revenues last year. So we have two more years to add another Rs 1,000 crore, that should be easily possible, said Suresh.
3:02 pm UP Bypolls: Candidates of the Samajwadi Party consolidated their leads over nearest BJP rivals in Gorakhpur and Phulpur Lok Sabha seats in Uttar Pradesh, latest trends showed.
The Samajwadi Party had an electoral understanding with Mayawati's BSP and tied up with local satraps. Its candidate Pravin Nishad was leading over Upendra Dutt Shukla of BJP by 26,510 votes in Gorakhpur at the end of 17th round of counting.
In Phulpur too, SP candidate Nagendra Pratap Singh Patel was leading by 29,474 votes after 20th round of counting.
With some more rounds of counting still being left, the overall picture appeared that the electorate did not back the saffron party ahead of the 2019 Lok Sabha election.
2:55 pm Market Update: Benchmark indices were off day's low in last hour of trade, aided by recovery in banks stocks and following positive European cues.
The 30-share BSE Sensex was down 50.65 points at 33,806.13 and the 50-share NSE Nifty fell 26.40 points to 10,400.50.
Nifty PSU Bank index rallied 1.6 percent and Nifty Bank index gained half a percent.
2:40 pm Bihar Bypolls: The RJD established leads in Araria Lok Sabha seat and Jehanabad Assembly constituency while the BJP was leading in Bhabhua Assembly seat in bypolls in Bihar.
According to latest data, RJD's Sarfaraz Alam, who had in the earlier rounds trailed behind BJP's Pradip Kumar Singh, was now leading by about 14,500 votes after ninth rounds of counting of votes.
According to election office sources, a total of 28 rounds of counting will take place for results of Araria Lok Sabha seat bypoll necessitated due to demise of RJD MP Mohammad Taslimuddin.
Alam, who crossed over from JD(U) to Lalu Prasad's party RJD to contest the bypoll, is son of Taslimuddin.
2:30 pm Gold Update: Gold rallied by Rs 65 to Rs 31,515 per ten gram at the bullion market on firm global trend and pick-up in buying by local jewellers.
Silver also moved up by Rs 60 to Rs 39,560 per kg due to increased offtake by industrial units and coin makers.
Traders said sentiment got a boost after gold edged higher overseas on a weaker dollar following US Secretary of State Rex Tillerson's sudden dismissal and after consumer price data pointed towards a path of gradual hikes in US interest rates.
2:27 pm PSU banks volatile: Public sector banks shares recovered sharply from day's low to gain up to 4 percent intraday, led by short covering. These shares had fallen up to 4 percent in morning after the increase in PNB fraud amount for the second time.
All PSU banks were in the green barring PNB. OBC and Bank of Baroda were biggest gainers among PSBs, rising 4 percent each.
Union Bank of India, Syndicate Bank, Indian Bank, IDBI Bank, Andhra Bank, Allahabad Bank and Canara Bank gained 1-3 percent.
PSU Bank index rallied as much as 1.4 percent after losing more than 2 percent in morning. In fact, Nifty Bank index also recovered from day's low, but were still trading mildly lower due to correction in ICICI Bank, Axis Bank, Kotak Mahindra Bank and IndusInd Bank.
2:15 pm Policy Rate Cut: The Reserve Bank of India (RBI) is expected to cut key policy rates by 25 bps in August, which will lead to lending rate cuts, and in turn support growth, says a report.
"We continue to expect RBI to cut 25 bps in August, if rains are normal, to cool yields and signal lending rate cuts, BofAML said in a research note.
According to global financial services major Bank of America Merrill Lynch (BofAML), risks regarding price rise are overdone and March inflation is likely at 4.2 percent, well within RBI's 2-6 percent mandate.
As per the global brokerage, fundamentals of the country like growth, money supply and monsoon, point to a benign inflation outlook.
2:05 pm Market Outlook: Vinod Nair, Head of Research at Geojit Financial Services, said the main reasons for this correction are premium valuation and increase in the cost of funds in India & globally. In the meantime introduction of long-term capital gain tax in India impacted the performance of India, which may continue in the short-term.
The pain in the market will release only as valuation becomes more attractive and trend of interest cost stabilise. In the near-term, RBI is providing some additional liquidity in the bond market, which will provide some relief to the market and financial sector.
Also, Mutual Funds have a high amount of cash in hand. FIIs are in a selling mode but MFs are increasing their exposure to equities on a MoM basis.
Some stability in the global market, non-redemption in MF and availability of market at bargaining price can provide some support to the domestic market in the near-term.
1:55 pm IPO: State-owned steel company Mishra Dhatu Nigam (MIDHANI) will open its initial public offering for subscription on March 21, with a price band of Rs 87-90 per share.
The IPO comprises of an offer for sale of 4,87,08,400 equity shares by the President of India acting through the Ministry of Defence, which consists of a reservation of up to 18,73,400 equity shares for eligible employees.
The company intends to raise Rs 438.4 crore through the issue at higher end of price band. The offer will close on March 23.
As it is an offer for sale, the company will not receive any proceeds from the offer and all proceeds shall go to the government.
1:40 pm Europe Trade: Equities in Europe were lower as investors monitored fresh cooperate earnings as well as political developments in the US.
The pan-European Stoxx 600 was 0.12 percent lower with most sectors moving in negative territory.
1:30 pm Market Update: Benchmark indices continued to reel under selling pressure, with the Sensex falling 167.91 points to 33,688.87.
It was dragged by HDFC, Reliance Industries, ICICI Bank, ITC, Kotak Mahindra Bank and Infosys. However, Yes Bank and Tech Mahindra were biggest gainers among Nifty50 stocks, up 2 percent each.
The Nifty was down 60.50 points at 10,366.40.
The market breadth was weak as about 1,411 shares declined against 1,061 advancing shares on the BSE.
1:25 pm SEBI on retail investors: Markets regulator Sebi is considering linking retail investors' exposure to derivatives with their income, a move aimed at preventing them from taking unreasonable positions in risky instruments.
The issue is expected to be discussed at the board meeting of the Securities and Exchange Board of India (Sebi) this month, officials said.
According to Sebi, trading turnover in these products has seen a sharp surge of over ten-fold over the past decade, during which the ratio of trades in equity derivatives to that of equity cash market has risen to over 15-times.
While a large number of individual investors are active in the derivatives segment, it has been observed that a number of them may not have an adequate financial capability to withstand risks posed by complex derivative instruments, Sebi said.
As per the proposal being considered, the total annual income can be made deciding factor for the exposure a retail investor can take into futures and options, the officials said.
1:12 pm Aarti Drugs in focus: Aarti Drugs said based on the preliminary inspections the damage to the affected unit is mainly in air handling unit systems, false ceiling, plastering, windows and door panels etc.
"We estimated the repair work for above-mentioned damages will take around 45 to 60 days, to restart the operations, thus limiting the loss of revenue to approximately 2-3 percent on annualised terms," the company said.
Fixed assets including inventory of the affected plant are adequately insured on reinstatement basis.
The company is also adequately insured for any loss of profit arising out of production shortages due to this incident.
12:59 pm Fund Raising: Dhanlaxmi Bank informed exchanges that a meeting of the board of directors of the bank is scheduled to be held on March 20, 2018 to approve the proposal for raising further capital by issue of unsecured redeemable non-convertible Basel III compliant Subordinated Tier II Bonds in the nature of debentures (bonds) up to Rs 150 crore on private placement basis.
12:50 pm UP LS bypolls: SP leading in Gorakhpur, Phulpur: Samajwadi Party candidates were leading in Gorakhpur and Phulpur Lok Sabha constituencies in Uttar Pradesh for the parliamentary by-elections, officials said.
12.30 pm Lok Sabha passes Finance Bill 2018: Lok Sabha passed Finance Bill 2018 with 21 amendments and 3 new clauses.
12:20 pm BHEL commissions 600 MW thermal power plant: Bharat Heavy Electricals (BHEL) has successfully commissioned a 600 MW coal-based thermal power plant in the state of Andhra Pradesh.
The unit has been commissioned at Rayalaseema Thermal Power Project, of Andhra Pradesh Power Generation Corporation, located in Cuddapah district of Andhra Pradesh.
12:05 pm WPI inflation data: February WPI Inflation at 2.48 percent versus 2.84 percent MoM. Manufacturing product inflation at 3.04 percent and vegetable inflation at 15.26 percent.
12:00 pm Market Check: The benchmark indices trading at day's low with Sensex slipped more than 200 points and Nifty trading around 10,350 level.
The Sensex was down 211.16 points at 33645.62, and the Nifty down 69.00 points at 10357.90. About 972 shares have advanced, 1367 shares declined, and 167 shares are unchanged.
11.45 am Citi on Coal India: Citi has downgraded the stock to neutral from buy and also cut target price to Rs 320 from Rs 365 per share.
According to firm, most of the triggers have largely played out and there is a limited visibility on further triggers.
Further FSA price hikes may not be imminent and e-auction price upside may be limited, it added.
11:25 am Market Outlook: The pain may not be over for Indian market even after a near 10 percent correction from the all-time high recorded earlier in January, feels Raamdeo Agrawal, Joint MD at Motilal Oswal Financial Services. There could be another 10 percent slide in Nifty in 2018, Agrawal told CNBC-TV18.
Volatility hit Indian markets after a largely calm calendar year 2017 due to a rise in bond yields (both in India and globally), tightening liquidity conditions, fears of inflation, and adverse market reaction to domestic policy events, especially the Union Budget.
11:05 am Buzzing: Shares of Fortis Healthcare advanced 5.6 percent as Yes Bank acquired stake in the company.
Yes Bank has acquired 89,781,906 equity shares, constituting 17.31 percent of the paid-up share capital of Fortis Healthcare, pursuant to invocation of pledge on the said equity shares subsequent to default by promoters group companies in the credit facility provided by the bank, company said in release.
10:55 am Market Update: The market continued to trade lower following global weakness, with the Sensex falling more than 100 points and the Nifty is struggling below 10,400 levels.
Midcaps outperformed frontliners, with the Nifty Midcap index recovering from day's low to trade mildly higher
Nifty PSU Bank index trimmed losses to 1 percent from 2 percent.
10:50 am Stake Sale: Canara Bank will receive commercial bids for their stake in Can Fin Homes today. In an interview to CNBC-TV18, PV Bharathi, Executive Director of Canara Bank said we are expecting 6-7 parties to bid for Can Fin Homes.
She further said that the bank has put the entire stake in Can Fin Homes on the block.
Talking about LoU ban, she said she doesn't see much impact on bank due to ban on Letters of Undertaking.
On NPA resolution circular, she said she is expecting accounts worth Rs 3,000 crore to be resolved.
10:36 am Market Outlook: At a time when the market is reeling under volatile moves, experts at HSBC Global AMC believe that this is the time for long term investors to focus on the positives.
The lack of volatility earlier was worrisome, but its return has signalled that the market's behaviour is normal in nature now.
''We have to focus on long term earnings…we are on the cusp of recovery and I think I would sit tight and wait. The best is yet to come,'' Tushar Pradhan, CIO HSBC Global India told CNBC-TV18 in an interview. He added that investors need to understand that we have the fastest-growing economy in the world and earnings upmove will help the case.
Speaking on investor behaviour, Pradhan believes that the real test of the investor would be in case of a major correction if there is a substantial external element.
10:26 am PNB Fraud Case: Punjab National Bank (PNB) has told the police that it has uncovered additional exposure of about Rs 942.18 crore (USD 145.27 million) to Asmi Jewellery of Gitanjali Group in connection with a massive alleged fraud, according to a court filing by the Central Bureau of Investigation.
This takes the Delhi-based lender's total exposure to one of country's biggest banking frauds up to Rs 13,640 crore from the earlier estimate of Rs 12,700 crore.
As investigations widen and unauthorized loans are uncovered, the bank has said that the total amount allegedly defrauded by the accused (Gitanjali Group) till date is about Rs 7,080.86 crore during the period 2013-17, according to the CBI filing. The investigating agency has requested permission for further investigation under The Prevention of Corruption Act.
Previously, PNB had pegged its fraud exposure to Gitanjali Group, controlled by Mehul Choksi, at Rs 6,138.28 crore, after addition of Rs 1,251.56 crore on February 22.
10:16 am Buzzing: Public sector banks shares hit the most, with the PSU Bank index itself falling more than 2 percent intraday after the increase in PNB fraud amount for the second time.
Punjab National Bank and Canara Bank were biggest losers among PSBs, shedding 4 percent each.
Bank of India, IDBI Bank, Allahabad Bank, OBC, Syndicate Bank, Union Bank of India, Andhra Bank, Bank of Baroda and SBI slipped 1-3 percent.
PSU Bank index lost 13 percent in last one month, especially after PNB detected biggest banking fraud while Nifty Bank index shed 3.6 percent and Nifty 50 was down 1.6 percent in same period
10:02 am Rupee Trade: Amid mixed global cues, the rupee lost 10 paise at 65 against the US dollar at the Interbank Foreign Exchange after opening 2 paise higher.
Yesterday, the rupee had gained 15 paise to close at 64.89 against the US currency on heavy foreign fund inflows after strong macro-economic data.
9:52 am Order Win: L&T Hydrocarbon Engineering, a wholly owned subsidiary of Engineering and Construction major Larsen & Toubro, has won orders worth in excess of Rs 1,600 crore across various business segments.
The onshore Projects business of LTHE has secured a lump sum turnkey contract, from a leading Indian Client, for the design, supply, and construction of a large LNG Tank facility in the east coast of India. The business also secured additional work from existing projects under execution in Saudi Arabia & Kuwait.
The construction Services business of LTHE also secured an additional order, from a prestigious client, for a new Coal Bed Methane facility being developed in the central region of India.
9:42 am Market Update: The market extended opening losses as benchmark indices were down half a percent following the negative lead from Asia and US after the sacking of US Secretary of State Rex Tillerson, and amid talk of potential US tariffs against China.
PSU banks hit most, with the PSU Bank index losing over 2 percent after the increase in amount of PNB fraud case and the RBI discontinues use of LoUs and LoCs as trade credits.
9:32 am Tillerson's Exit: Beleaguered Secretary of State Rex Tillerson, who was fired yesterday by US President Donald Trump, said he would delegate his responsibilities to his deputy and would step down by end of this month.
Tillerson, who was travelling to Africa, had to return in midway citing "the demands of work and the need to be in Washington for in-person meetings."
For technical purposes, Tillerson said he would remain the Secretary of State till March 31 and till then he would delegate his responsibilities to the Deputy Secretary of State John Sullivan.
The 65-year-old former Exxon Mobil chief executive and the president had strained relations and the two had differences over a host of issues including the US policy on North Korea, Russia and Iran.
9:27 am IPO: ICICI Securities, the broking business subsidiary of ICICI Bank, is expected to open its initial public offer on March 21, reports CNBC-TV18 quoting sources.
The company after consultation with merchant bankers may have fixed the price band at around Rs 1,215-1,240 per share.
The country's largest private sector lender is likely to raise approximately Rs 4,200 crore by diluting 24 percent equity stake in ICICI Securities through public offer.
Sources said the broking business of the bank may be valued at Rs 16,800 crore.
The issue is expected to close on March 23, sources added.
9:19 am Buzzing: Shares of Strides Shasun added 1.5 percent as it has received USFDA approval for Efavirenz Tablets.
The company's wholly owned subsidiary Strides Pharma Global Pte. has received approval for Efavirenz Tablets USP, 600 mg from the United States Food & Drug Administration (USFDA).
Efavirenz Tablet is generic version of Sustiva Tablets of Bristol-Myers Squibb Company.
According to IQVIA data, the US market for Efavirenz Tablets USP, 600 mg is approximately USD 115 million and Strides is only the second generic company to get the approval for the product under the para IV route.
The product will be manufactured at the company's Oral dosage facility at Bangalore and will be marketed by Strides Pharma Inc. in the US Market. Strides is launching the product immediately.
9:15 am Market Check: Benchmark indices started off the day on a negative note on Wednesday, continuing consolidation for second consecutive session. Weak global cues weighed on market sentiment.
The 30-share BSE Sensex was down 99.50 points at 33,757.28 and the 50-share NSE Nifty fell 37.60 points to 10,389.30.
TCS, HCL Technologies, Tech Mahindra, L&T and Aurobindo Pharma gained strength.
Tata Steel, Coal India, SBI, Hero Motocorp, Hindalco, HPCL, BPCL and ONGC were under pressure.
The Nifty Midcap index was down 0.3 percent.
SBI, ICICI Bank, Axis Bank, Bank of India, Yes Bank, Andhra Bank and Canara Bank declined up to 3 percent.
Future Retail, Graphite India, NBCC and Fortis Healthcare gained up to 4 percent.
Asian markets tracked losses seen on Wall Street, following the sacking of US Secretary of State Rex Tillerson, and amid talk of potential US tariffs against China.
The Nikkei 225, Kospi, Shanghai Composite, Hang Seng and ASX 200 were down between 0.4 percent and 1.2 percent.
Meanwhile at Wall Street, Dow Jones and S&P 500 closed down 0.6 percent while Nasdaq lost 1 percent on Tuesday.