Sensex ends nearly 300 points lower; Nifty gives up 11,300
18 September 2018
Market at Close: A sharp selloff in the last hour dragged the market to its lowest point, with the Nifty breaching 11,300-mark and ending below it. The Sensex closed almost 300 points lower.
US imposing tariffs on USD 200 billion worth of Chinese goods and services late on Monday along with a surging crude prices weighed on the market on Tuesday. Adding to the pain was a weakening rupee, which fell to 72.75 per US dollar when the market came to a close. Crude prices surged in the last hour of trading after Saudi Arabia is said to have been comfortable with Brent trading above USD 80 per barrel.
At the close of market hours, the Sensex ended lower by 294.84 points or 0.78% at 37290.67, while the Nifty fell 98.90 points or 0.87% at 11278.90. The market breadth is negative as 879 shares advanced, against a decline of 1,775 shares, while 178 shares were unchanged.
Shares of Hindustan Unilever and Yes Bank were the top gainers, while State Bank of India, Tata Motors, and Indiabulls Housing lost the most.
Market Update: The benchmark indices are trading at day's low with Nifty slipped below 11,350 dragged by PSU banks and realty index, which are down 5 percent and 3 percent respectively.
SBI, Tata Motors, Bajaj Auto, Bharti Airtel and Axis Bank are the top losers on the Sensex.
CLSA maintains outperform on HUL: Share price of Hindustan Unilever gained 4 percent after broking house CLSA has maintained outperform rating with a target of Rs 1,950 per share.
According to CLSA, management commentary pre-quarter close remains positive and sees 2QFY19 demand trends broadly similar to first quarter.
Rural growth continues to outpace the urban growth, while modern trade gains share from general trade, it added.
HSBC maintains buy on Titan: Shares of Titan Company added 2.3 percent as foreign brokerage HSBC maintained buy rating on the stock. Meanwhile, it has cut the target price to Rs 1,050 from Rs 1,100 per share.
The share has corrected 16 percent from its peak due to wavering revenue growth guidance, while valuation remains appealing post selloff, said research house.
According to CNBC-TV18, Reliance Jio managed to add 1.17 crore subscribers in July against 97.1 lakh added in the previous month.
Vodafone added 6.1 Lakh Subscribers Vs 2.7 Lakh in the previous month.
Airtel added 3.1 Lakh subscribers Vs 10,689 in June, while Idea added 5,489 subscribers Vs 63.7 Lakh.
Arbitration panel rules in favour of Rajiv Bansal: The arbitral tribunal has communicated its decision in the arbitration proceedings in relation to the severance agreement between the company and its former CFO, Rajiv Bansal.
As per the award, Infosys is required to pay to Bansal the outstanding severance amount of Rs 12.17 crore with interest. The company’s counter claim for refund of previously paid severance amount of Rs 5.2 crore and damages, has been rejected.
L&T bags order: The construction arm of L&T has won orders worth Rs 2048 crore across two business segments.
Power transmission & distribution business has secured EPC orders worth Rs 1633 crore and water & effluent treatment business won an order worth Rs 415 crore.
Analyst view on banks merger: The announcement of amalgamation of Dena bank, Vijaya Bank and BOB is an attempt to show that there is some serious attempt by the government to resurrect the ailing PSU banks, the government of course is positioning this as an advent of another big PSU bank like SBI, that can stand strongly with a bigger market power to fend against the gaining dominance of private players. While mergers are long awaited imperative, I think the plan lacks solidity unless there is a serious quantification of capital impairment, said Dhananjay Sinha, Head of Research, Economist and Strategist, Emkay Global Financial Services.
Also one needs to know what is the clear Tier 1 capital, haircuts and what is the government’s commitment toward further capital infusion; these are vital information that is still awaited. Assuming 75% haircut for unprovided impaired assets (NNPA, which now subsumes the restructured assets), the combined Tier 1 capital would stand at around 4%. Also the combined ROA will stand at around 0; a combinations that hardly exudes confidence to grow market power. he said further.
Buzzing: Shares of Gujarat Gas rose 2.2 percent as company accepted authorisation from PNGRB for local natural gas distribution.
PNGRB has issued the letter for grant of authorisation to Gujarat Gas (GGL) to lay, build, operate, or expand city or local natural gas distribution network for the geographical area of Narmada (Rajpipla) district in the state of Gujarat.
GGL has been granted 300 months of infrastructure exclusivity i.e. valid up to September 05, 2043 and 96 months of marketing exclusivity valid up to September 05, 2026 for the CGD network.
Profit booking in sugar stocks: ?Suagr stocks seen some profit booking on Tuesday after they rallied upto 70 percent in the last 5 days after government announced hike on ethanol prices by 25 percent.
In the last week the Cabinet Committee on Economic Affairs raised the procurement price of ethanol derived from 100 percent sugarcane juice to Rs 59.13 per litre from Rs 47.13.
Market Update: Some selling pressure is visible on the market, as benchmarks have extended their losses. The Nifty has given up 11,350 as well, while the Sensex is down almost 100 points.
Among sectors, banks, automobiles, IT, and metal names are taking a hit, while pharmaceuticals are trading higher. The midcap index is down over half a percent as well.
The Sensex is currently down 89.78 points or 0.24% at 37495.73, while the Nifty is lower by 32.00 points or 0.28% at 11345.80. The market breadth is negative as 896 shares advanced, against a decline of 1,226 shares, while 155 shares were unchanged.
HUL and Yes Bank are the top gainers, while Vedanta, State Bank of India, and Hindalco have lost the most.
The Indian rupee is hovering around 72.49 per US dollar-mark. The currency had opened at lower level at 72.5050 per dollar. Here is a look at an interesting chart on how the rupee has fallen sharply during the time of financial crises. Image source: Bloomberg, Kotak Institutional Equities
TATA MOTORS FALS 1% ON REPORT OF PRODUCTION CUT AT UK
Tata Motors’ shares are down over a percent based on a PTI report that JLR has cut production schedule at its Castle Bromwich plant in UK. This, it said, is based on continuing headwinds which are impacting the British car industry. The change in schedule, described as "standard business practice" by the Tata Group company, will see nearly 1,000 workers at the plant shifting from a five-day work schedule to a three-day one until Christmas this year.
SBI TO SELL 8 NPA ASSETS TO GET DUES WORTH RS 3,900 CRORE
News agency PTI is reporting that State Bank of India will sell eight non-performing assets to recover dues worth over Rs 3,900 crore and has invited bids from asset reconstruction companies (ARCs) and financial institutions (FIs). The stock is currently trading lower by 1 percent.
"In terms of the bank's revised policy on sale of financial assets in line with the regulatory guidelines, we place these accounts for sale to ARCs/banks/NBFCs/FIs, on the terms and conditions indicated," the bank said in the bid document on its website.
Of the eight accounts on the block, Kolkata-based Rohit Ferro Tech has the highest loan outstanding against it at Rs 1,320.37 crore, followed by Indian Steel Corporation Ltd at Rs 928.97 crore; Jai Balaji Industries at Rs 859.33 crore and Mahalaxmi TMT Pvt Ltd at Rs 409.78 crore.
The remaining accounts belong to Impex Ferro Tech (Rs 200.67 crore), Kohinoor Steel Pvt Ltd (Rs 110.17 crore), Modern India Concast (Rs 71.16 crore) and Ballarpur Industries (Rs 47.17 crore).
SBI has asked the interested ARCs/FIs to conduct the due diligence of these assets with immediate effect after submitting expression of interest and executing a non-disclosure agreement with the bank. The e-bidding for these accounts will take place on September 26.
OFS TECHNOLOGIES HITS 20% UPPER CIRCUIT
Shares of OFS Technologies have hit an upper circuit on Tuesday morning as investors are betting on the company approving a bonus issue.
The Board approved issue of bonus shares i.e. six shares for every 10 shares held.
Buzzing: Shares of OFS Technologies gained 20 percent on Tuesday after company approved the bonus share issue.
The board of the company in its meeting held on September 17 approved issue of bonus shares of 6 for every 10 held by the existing shareholders of the company.
The board also approved the proposal for entering into acquisition of new software business in the field of Agri and Aqua based Company and tie-up with agri and aqua based Company for its further development.
BOB, DENA BANK AND VIJAYA BANK IN FOCUS
Shares of Bank of Baroda, Vijaya Bank and Dena Bank are all buzzing in trade on the back of a proposal to merge these three. The government, on Monday, made these announcements. Here is a look at the intraday movements of the stock so far.
HSBC MAINTAINS BUY CALL ON TITAN
Even as Titan stock saw a fall on Monday, owing to fears of a possible hike in gold import duty, HSBC has maintained it buy call on the stock, but cut the target to Rs 1,050 from Rs 1,100.
The global research firm believes that the stock has corrected 16 percent from its peak on wavering revenue growth guidance.
It highlighted that the company’s own scheme can spur growth ahead. Speaking on valuations, it added that the valuation remains compelling after the current selloff.
Market Update: Equity benchmarks have continued to trade flat, with the Nifty trading below 11,400.
The Sensex is up 23.19 points or 0.06% at 37608.70, and the Nifty up 3.20 points or 0.03% at 11381.00. The market breadth is positive as 969 shares advanced, against a decline of 636 shares, while 96 shares were unchanged.
PSU banks are undergoing some pain, with the Nifty PSU bank index trading over 2 percent lower. Stocks in this space are reacting to the merger proposal by the government for three banks that was announced on Monday evening. Pharmaceuticals and FMCG names are trading in the green. Meanwhile, midcaps are trading flat.
Sugar Stocks trade lower: After a massive run in last 5 days the selected sugar stocks are trading lower in today's trade. Dalmia Bharat Sugar, Ugar Sugar Works, Dhampur Sugar Mills, Dwarikesh Sugar Industries, Uttam Sugar Mills and Avadh Sugar & Energy were down up to 8 percent.
Market Opens: The benchmark indices opened on flat note on Tuesday amid no major development in the global markets.
Pharma, metal, energy stocks are providing some support to the indices, while PSU banks are down 0.7 percent in the early trade.
At 09:17 hrs IST, the Sensex is down 22.96 points or 0.06% at 37562.55, and the Nifty down 1.90 points or 0.02% at 11375.90.
Bank of Baroda was down 10 percent, while Dena Bank gained 20 percent.
Market at pre-open: The benchmark indices are trading higher in the pre-opening trade with Nifty is trading above 11,400.
At 09:02 hrs IST, the Sensex is up 94.42 points at 37,679.93, while Nifty up 36 points at 11,413.80.
Rupee opened marginally lower at 72.55 against previous close of 72.51.
The PSU banks are in news today ahead of merger of Bank of Baroda with Dena Bank & Vijaya Bank. Stocks like Corporation Bank, IOB, Vijaya Bank are up 13-20 percent. On the other hand Bank of Baroda was down 10 percent in pre-opening trade.