Sensex ends over 160 points lower, Nifty gives up 11,250; banks, FMCG names drag

CNBC

Market at Close: Equity benchmarks ended a volatile trading day in the red, with the Nifty giving up 11,250-mark. The Sensex ended over 169 points lower. 

A selloff among major sectors such as banks, automobiles, and FMCG and a larger selling pressure among midcaps weighed on the indices. The Nifty Midcap index ended around a percent lower. 
At the close of market hours, the Sensex closed lower by 169.45 points or 0.45% at 37121.22, while the Nifty was down 44.50 points or 0.39% at 11234.40. The market breadth is negative as 978 shares advanced, against a decline of 1,667 shares, while 186 shares were unchanged.
Coal India, ONGC, and BPCL were the top gainers while Bharti Airtel, IndusInd Bank, and Bajaj Finserv lost the most.   
SUGAR MEET DEFERRED
The Union Cabinet did not consider Wednesday Rs 4,500 crore plan to more than double the production assistance paid to sugarcane farmers and transport subsidy to sugar exporting mills, sources said.
The Cabinet Committee on Economic Affairs (CCEA) may take up the food ministry's proposal next week, they added.
The ministry has proposed sharp increase in production assistance to farmers to Rs 13.88 per quintal for 2018-19 marketing year (October-September) from Rs 5.5 at present.
The proposal to raise production assistance and transport subsidy of up to Rs 3,000 per tonne to mills for exports of five million tonnes of surplus sugar is part of the government plan to clear more than Rs 13,500 crore arrears sugar mills have towards farmers.
Market Update: There has been a sharp selloff in the last few minutes, with the Sensex shedding 180 points. The Nifty has given up 11,250-mark as well. 
Investors are selling stocks in banks, automobiles, and pharmaceuticals, while consumer names have extended their losses. Midcaps, too, have extended weakness, with the Nifty Midcap falling over a percent.  
The Sensex is down 180.69 points or 0.48% at 37109.98, while the Nifty is down 50.60 points or 0.45% at 11228.30. The market breadth is negative as 854 shares advanced, against a decline of 1,679 shares, while 182 shares were unchanged.
Coal India, ONGC, BPCL and GAIL gained the most, while IndusInd Bank, Maruti, and Bajaj Finserv lost the most. 
Varroc Engineering enters into JV with Romanian Company: VarrocCorp Holdings B.V., The Netherlands, a wholly owned subsidiary of Varroc Engineering has signed a joint venture agreement with ELBA SA, a privately-held lighting and electronics company based in Romania.
The joint venture will focus on electronics manufacturing, and - given the constantly increasing electronic content of lighting products - will significantly support Varroc Lighting's successful growth in Europe.
At 14:45 hrs Varroc Engineering was quoting at Rs 978.35, down Rs 32.50, or 3.22 percent.
HSBC on M&M Financials: Foreign research house HSBC maintained buy rating on the stock but cut target to Rs 569 from Rs 578. It believes that there is a potential upside of 28 percent in the stock.
The company tracks well on growth and asset quality led by strong rural demand, while rising interest rates could weigh on net interest margins, it said.
Research house see enough levers in P&L to sustain RoE improvement.
At 14:40 hrs Mahindra & Mahindra Financial Services was quoting at Rs 432.15, down Rs 11.05, or 2.49 percent.
Dilip Buildcon board meeting on September 28: Company's board meeting is scheduled on September 28 to consider and approve to alter main object clause of memorandum of association to start new business activity.
Also, it will consider and take strategic initiatives by way of backward and forward integration which will add value addition to the company as well as to the stakeholders.
The trading window for dealing in the securities of the company by its designated employees, directors and promoters shall be closed from September 19, 2018 to September 21, 2018 (both day inclusive).
At 14:22 hrs Dilip Buildcon was quoting at Rs 730.05, down Rs 17.90, or 2.39 percent on the BSE.
IDFC Securities initiates outperform call on Dr Lal PathLabs: IDFC Securities initiated outperform call on the stock with potential upside of 23 percent. It has kept a target of Rs 1,184 per share.
IDFC Securities believes that company is one of the winners, given its proven execution capabilities and profitable business model.
Focus on volume growth, competitive pricing and steady network expansion are positive for the company. It expect 16 percent revenue CAGR and steady 26 percent margin over FY18-21, also economic gains to increase for large players and create multi-year growth stories.  
Buzzing: Shares of Tata Steel advanced 3 percent on completion of stake acquisition in Creative Port Development
The company has informed that it has completed the acquisition of 51 percent equity stake in Creative Port Development.
At 13:58 hrs Tata Steel was quoting at Rs 625.35, up Rs 12.90, or 2.11 percent on the BS
Market Update: After giving up majority of gains, indices have continued to trade in a narrow range. The Nifty has hovered around 11,300, while the Sensex is trading above 37,300-mark. 
Among sectors, FMCG continues to be the big loser, while banks have seen some recovery, pushing the indices above the flat line. But, midcaps have continued to trade weak and a combination of this along with consumer names is weighing on equity benchmarks. 
The Sensex is up 19.38 points or 0.05% at 37310.05, while the Nifty is higher by 6.40 points or 0.06% at 11285.30. The market breadth is negative as 950 shares advanced, against a decline of 1,500 shares, while 177 shares were unchanged.
Coal India, ONGC, BPCL and GAIL are the top gainers, while IndusInd Bank, Maruti, Zee Entertainment and Bajaj Finserv have lost the most.  
SUGAR STOCKS RALLY ON RS 4,500 CRORE PACKAGE FOR INDUSTRY
Shares of majority sugar stocks are soaring in trade on September 19, 2018 as investors cheered a likely package announcement by the government to boost exports. 
The likes of Avadh Sugar, Dharani Sugar, and Uttam Sugar, among others, are all rising in trade, while frontline sugar names are witnessing profit booking. Balrampur Chini, Shree Renuka Sugar and Triveni Engineering are all down up to 4 percent.  
News agency PTI reported that the Union Cabinet is likely to consider a Rs 4,500 crore plan to more than double the production assistance paid to sugarcane farmers and transport subsidy to mills exporting the sweetener, sources said.
The proposal to raise production assistance to Rs 13.88 per quintal to farmers and transport subsidy to mills for exports of five million tonnes of surplus sweetener is part of government plan to clear more than Rs 13,500 crore arrears sugar mills have towards farmers.
Market Update: Selling in banks, and a further weakness in the consumer space has dragged equity benchmarks from the high points. They are currently trading marginally in the red. 
Metals have continued to be the standout performers, led by gains in names such as Tata Steel. Meanwhile, midcaps have also extended their fall, with the Nifty Midcap index down almost a percent.  
The Sensex is down 33.46 points or 0.09% at 37257.21, while the Nifty is lower by 10.40 points or 0.09% at 11268.50. The market breadth is negative as 963 shares advanced, against a decline of 1,453 shares, while 158 shares were unchanged.
WORLD GOLD COUNCIL WARNS INDIA AGAINST CURBS ON GOLD IMPORTS
News agency Reuters is reporting that India should not tamper with its gold import duty or impose other restrictions to support the rupee, the World Gold Council said on Wednesday, as the government considers ways to cut “non-necessary” imports to stem an outflow of dollars.
Somasundaram PR, managing director of the Indian operation of the industry body, said current demand for the metal is down 7 percent this year from a year earlier and that gold was “not at the centre of the current account deficit issue”.  
Market Update: Equities are a shade off their high points, with the Nifty hovering around 11,300. The Sensex is trading marginally higher. 
Among sectors, consumer names are taking a hit, with the Nifty FMCG index trading one-third of a percent lower. Banks, IT and metals, among others are in the green. In the broader markets, the Nifty Midcap index is down 0.30 percent.  
The Sensex is up 69.32 points or 0.19% at 37359.99, while the Nifty is higher by 22.60 points or 0.20% at 11301.50. The market breadth is narrow as 1,129 shares advanced, against a decline of 1,194 shares, while 159 shares were unchanged.
Rupee Update: Indian rupee gained further in the afternoon trade after it saw positive opening in early trade today. It is trading higher around at 72.50 per dollar.
It opened higher by 27 paise at 72.71 per dollar versus previous close 72.98.
Nomura initiates buy on JSW Steel: The broking firm Nomura initiated a buy on JSW Steel with a target at Rs 484 per share. According to firm, capacity utilisation is going to expand, also low cost advantage to continue for the company. Strong BS and cash flows to support the growth.
JSW Steel was quoting at Rs 422.30, up Rs 15.60, or 3.84 percent. It has touched a 52-week high of Rs 423.30.
MCX rallies as SEBI allows foreign investors to trade in commodity market: ?MCX rallied nearly 3 percent on Wednesday after the market regulator, Sebi, said that it would soon come out with revised KYC norms for foreign investors and also overseas entities to trade in commodity derivative market.
With regard to the regulatory framework for permitting foreign entities, having actual exposure to Indian commodity market, to participate in the domestic commodity derivative market, Sebi said that such entities would be classified as Eligible Foreign Entities (EFEs).
Reacting to the new rules, domestic brokerage firms, Motilal Oswal maintains a buy on MCX and with a target price of Rs 1000, which translates into an upside of about 27 percent from current levels.
Strides Pharma Science receives 3 observations from USFDA: Shares of Strides Pharma Science plunged 5.6 percent after company received three observations from the USFDA.
The formulations facility in Bangalore recently underwent pre- approval product inspection by the USFDA. The inspection ended on August 25, 2018 and the company has been issued a Form 483 with 3 observations.
The company believes that the observations are not material in nature and we have already responded to the USFDA.
The company has recently (post completion of the inspection) received a product approval for Potassium Chloride Extended release tablets from this facility.
KIOCL approves buyback: Share price of KIOCL declined nearly 20 percent after company approved the proposal for buyback of its shares.
Board of directors of the company in its meeting held on September 18 approved the proposal to buyback of not exceeding 1,25,88,235 equity shares (representing 1.98 percent of paid up equity) at a price of Rs 170 per share, payable in cash for an aggregate consideration not exceeding Rs 214 crore.
The company has fixed October 1 as record date for the same.
Buzzing: Shares of RITES gained 5.6 percent intraday Wednesday as company won an additional contract of Rs 436 crore.
The company has been executing a project of Indian Railways for setting up of wagon workshop at Dalmianagar for which the initial contract cost was Rs 89 crore.
The enhanced scope and revision in estimates has resulted in additional contract value of Rs 436 crore.
The work is scheduled to be started in the last quarter of this financial year.
Rupee Update: The rupee recovered further to trade at around 72.55 against the US dollar, up 41 paise from previous all-time closing low of 72.97 a dollar on fresh selling of the US currency by exporters and banks.
Besides, dollar-selling by exporters and banks, easing crude prices in the global market and weakness in the dollar against other currencies overseas, helped the domestic currency rebound, forex dealers said.
A higher opening in the equity market also supported the recovery in the rupee, they said.
Consolidation to continue for next 6-8 months
Pankaj Tibrewal, Vice President and Equity Fund Manager, Kotak Mahindra Mutual Fund said there has been tug of war between micro concerns and macro factors. So the market is likely to be volatile over next 6-8 months given we are going into state elections, general elections. "We are cautious on market as valuations are not cheap right now."
Capital market regulator Securities and Exchange Board of India (SEBI) cut fees or expense ratio for mutual funds, which will have direct impact on their earnings or these companies can pass on to distributors to reduce impact on earnings.
Tibrewal said Kotak MF is regulated entity and respects to any verdict of regulator. He believes overall growth perspective, this industry has lot of growth as it is only 13 percent of India GDP compared to 65 percent of GDP ratio globally.
It is difficult to say about the impact on MF as it is depend on AMC to AMC and how much they pass on to distributors.
Global brokerage house Morgan Stanley slashed target price of HDFC AMC stock to Rs 1,765 from Rs 2,050 per share while Nomura has downgraded Reliance Nippon AMC share to Neutral from Buy and also cut target price to Rs 210 from Rs 315 earlier after capital market regulator SEBI on Tuesday cut total expense ratio (TER) for mutual funds by 20-25 basis points.
Macquarie raises Nifty 1-year target to 12,000, says macro risks higher but not alarming
Macquarie India believes cyclical recovery is clearly getting broad-based with infra having turned around and real estate is at the inflection point.
The global brokerage house said the macro risks have increased but are not alarming yet.
The Indian rupee depreciated 14 percent this year to hit record low of 72.97 a dollar and crude oil prices jumped nearly 19 percent to $79 a barrel which both hit trade deficit of the country. In addition, escalated US-China trade tensions added fuel to the fire but improving fundamentals is the only positive and enough to support market.
The Nifty50 gained more than 8 percent and the Sensex rallied nearly 11 percent year-to-date while BSE Midcap and Smallcap indices fell 10 percent and 15 percent respectively.
Macquarie feels the valuation risk is limited to benchmark indices while midcap is still vulnerable.
It holds a Neutral stance on banks & metals while it has positive view on cement, real estate, industrials, IT & autos.
The research house raised 1-year Nifty target to 12,000 based on 16.6x FY20 estimated earnings.
HDFC AMC and Reliance Nippon slip after SEBI meet outcome: HDFC Asset Management Company share price dropped 7.6 percent and Reliance Nippon Life Asset Management fell 8.6 percent to hit 52-week low of Rs 195.60 as brokerages slashed their target prices after SEBI cut expense ratio for these companies.
Global brokerage house Nomura has downgraded Reliance Nippon AMC share to Neutral from Buy and also slashed target price to Rs 210 from Rs 315 earlier after capital market regulator SEBI on Tuesday cut total expense ratio (TER) for mutual funds by 20-25 basis points.
TER cut is in addition to the recent 15 bps cut in lieu of exit loads, it said.
Morgan Stanley also cut target price on HDFC AMC stock to Rs 1,765 from Rs 2,050 per share while having Overweight call on the stock. "Lowering EPS/price target is materially on sharp TER cut by SEBI."
The global research firm cut estimates for equity & gross revenue / AAAUM by 20 bps & 11bps respectively and expects some further near-term weakness.
Buzzing: Shares of IL&FS Transportation Networks rose 9.3 percent after company signed a settlement agreement with NHAI.
A settlement agreement was signed by Moradabad Bareilly Expressway (MBEL), a subsidiary of the company on various claims filed against NHAI in relation to the work of development, maintenance and management of a highway from Moradabad to Bareilly in the State of Uttar Pradesh, company said in release.
MBEL will be paid a claim compensation of Rs 425 crore by NHAI for the losses suffered by it on account of the cost overrun for development of the project.
Market Update: Benchmark indices erases all morning gains and trading flat with Nifty hovering around 11,300 mark.
The Sensex is up 7.02 points at 37,297.69, while Nifty is up 2.60 points at 11,281.50. About 867 shares have advanced, 803 shares declined, and 92 shares are unchanged.
Maruti Suzuki, HDFC, SBI, Wipro and Power Grid Corp are the top losers on the Sensex.
Buzzing: Shares of Sun Pharmaceutical Industries added more than 2 percent in the early trade on Wednesday after company received European Commission (EC) approval for Ilumetri.
Almirall has received the European Commission (EC) approval for Ilumetri (tildrakizumab) for the treatment of adults with moderate-to-severe chronic plaque psoriasis who are candidates for systemic therapy, company said in release.
Market Opening: It is a positive start on the Dalal Steet with Nifty trading above 11,300.
The Sensex is up 94.73 points at 37,385.40, while Nifty is up 35 points at 11313.90. About 669 shares have advanced, 266 shares declined, and 41 shares are unchanged. 
Coal India, Tata Steel, Yes Bank, Tata Motors, Eicher Motors, Dr Reddy's Lab are trading higher, while HDFC Bank, HDFC are trading lower. Midcap has outperform with a 0.5 percent gain
All the sectoral indices are trading in green with metal and pharma up over 1 percent.
Rupee Opens: The Indian rupee opened higher by 27 paise at 72.71 per dollar on Wednesday  versus previous close 72.98.
On Tuesday, the rupee closed at record low at 72.98 per dollar on the back of higher crude prices. It fell 47 paise in yesterday trading session.
Rupee fell more than 1 percent in last 2 days.
Market at pre-open: Positive start on the Dalal Street with Sensex gain over 100 points, while Nifty is trading above 11,300 mark.
At 09:02 hrs IST, the Sensex is up 120.45 points or 0.32% at 37411.12, and the Nifty up 32.70 points or 0.29% at 11311.60.
Titan trading lower after CLSA downgrades the stocks, IndusInd Bank, Yes Bank are other major losers in the pre-opening trade.