Nifty ends below 11,750, Sensex falls 407 points; Yes Bank declines 4%

21 Jun 2019

Market Close: The Indian indices wiped out most of its previous session gains and ended on weak note with Nifty finished below 11,750 level.

At close, the Sensex was down 407.14 points at 39,194.49, while Nifty was down 107.70 points at 11,724.10. About 1157 shares have advanced, 1292 shares declined, and 167 shares are unchanged.

Yes Bank, Maruti Suzuki, HDFC, Coal India and hero Motocorp were among major losers on the Nifty, while gainers were Tech Mahindra, UPL, Indiabulls Housing, Hindalco Industries and SBI.

Except PSU Bank all other sectoral indices ended lower led by the auto, pharma, energy, metal, IT, infra and FMCG.

Rupee Update: The Indian rupee has regained the lost ground and trading near its day's high level. It is trading lower by 11 paise at 69.55 per dollar against previous close of 69.44.

Crude Update: Oil prices rallied towards USD 65 per barrel on fears of a US military attack on Iran that would disrupt flows from the Middle East, which provides more than 20% of the world's oil output.

Market Update: Benchmark indices are trading lower on June 21 with Nifty below 11,750 level.

The Sensex is down 355.27 points or 0.90% at 39246.36, and the Nifty down 87.60 points or 0.74% at 11744.20. About 1076 shares have advanced, 1245 shares declined, and 129 shares are unchanged.

Maruti Suzuki signs MoU with Bank of Baroda:

Maruti Suzuki India announced signing of preferred financier MoU (Memorandum of Understanding) agreement with Bank of Baroda.

The partnership with Bank of Baroda will allow Maruti Suzuki to provide more comprehensive financing opportunities for dealers as well as customers.

UPL Jumps 4%

Shares of agrochemical company UPL (erstwhile United Phosphorous) rebounded 5 percent intraday after falling more than 8 percent in previous session, as Deutsche Bank maintained buy call on the stock with a target price at Rs 1,050, implying 21 percent potential upside from current levels.

Market Update: Indian indices are trading lower in the afternoon trade on June 21.

At 12:28 hrs IST, the Sensex is down 201.18 points at 39400.45, while Nifty is down 46.80 points at 11785. About 1042 shares have advanced, 1107 shares declined, and 108 shares are unchanged.

Buzzing: Share of Pidilite Industries fell more than 3 percent on June 21 after broking house CLSA has maintained sell call on the stock with a target price of Rs 1,060 per share.

Rupee Update: The Indian rupee recovered from the lows but trading lower by 20 paise at 69.64 per dollar against previous close of 69.44.

Sundaram Finance Buys BNP Paribas Stake in Securities Business

Sundaram Finance shares gained more than 2 percent intraday on acquisition of BNP Paribas' stake in securities business.

"We approved the acquisition of 2,20,51,470 equity shares, representing 49 percent in its subsidiary company, Sundaram BNP Paribas Fund Services Limited (SBFS), from BNP Paribas Securities Services, France, for a total consideration of Rs 1.5 crore," the company said in its NSE filing.

After this proposed acquisition, company's stake in SBFS will increase from 51 percent to 100 percent and SBFS will become a wholly-owned subsidiary of company.

Market Update: Benchmark indices extended the morning losses with Nifty below 11,800 level.

At 09:51 hrs IST, the Sensex is down 201.22 points or 0.51% at 39400.41, and the Nifty down 58.30 points or 0.49% at 11773.50. About 705 shares have advanced, 824 shares declined, and 75 shares are unchanged.

Buzzing: Share price of Welspun Corp added 2.6 percent in the early trade on Friday after company successfully commenced commercial production of pipes at Madhya Pradesh plant.

Dollar Update: The dollar struggled to get on the front foot on Friday, and was poised for a weekly loss against major currencies after the U.S. Federal Reserve joined global peers with plans to cut interest rates to support flagging economic growth.

Crude Update: Oil prices rose on Friday, with Brent crude heading for its first weekly gain in five weeks on tensions in the Middle East after Iran shot down a U.S. military drone and on hopes for a drop in US interest rates that may stimulate global growth.

Market Opens: It is a negative start for the Indian indices on June 21 after a massive rally seen in the previous session.

At 09:17 hrs IST, the Sensex is down 159.11 points or 0.40% at 39442.52, and the Nifty down 44.40 points or 0.38% at 11787.40. About 259 shares have advanced, 494 shares declined, and 31 shares are unchanged.

Indigo, Pidilite Industries, Ashok Leyland, TVS Motors, Tata Motors, Maruti Suzuki, Asian Paints, Sun Pharma, Infosys, TCS are among the major losers on the indices, while gainers are UPL and HCL Tech.

All the sectoral indices are trading lower led by the auto, pharma, FMCG, IT, energy, metal and infra.

Rupee Opens: The Indian rupee slipped in the early trade on Friday. It opened lower by 31 paise at 69.75 per dollar on Friday against previous close of 69.44.

Market at pre-open: Indian indices are trading flat in the pre-opening session.

At 09:03 hrs IST, the Sensex is up 41.29 points or 0.10% at 39642.92, and the Nifty up 1.20 points or 0.01% at 11833.

Asian markets trade mixed: Asian stocks struggled on Friday to track Wall Street's exuberance about a possible U.S. rate cut next month as anxiety over Sino-U.S. trade negotiations clouded the investor mood in the region.

CLSA on Pidilite Industries

Sell call, target at Rs 1,060 per share

Consumption slowdown concerning even as valuations remain elevated

CLSA on TVS Motor

Maintain sell call, target at Rs 360 per share

FY19 annual report provides a cautious commentary on 2-wheeler industries

CLSA on Oil & Gas

Exit IOC, BPCL & HPCL

Flat Indian demand, cut in global demand forecasts

OPEC+ is over 100% compliant to promised cuts

OPEC’s decision next month on extension of production cuts will be in focus

US oil inventories are above 5-year average levels

ONGC/OIL are our preferred buys as valuations are attractive

Citi on Balkrishna Industries

Buy rating, target cut to Rs 1,080 from Rs 1,110 per share

Weak global demand will likely put downward pressure on pricing

EPS estimates cut by 2-3% over FY20-22

Citi on United Breweries

Maintain buy call, target cut to Rs 1,560 from Rs 1,620 per share

Cut FY20/21 EPS estimate by 3-5% to account for input cost pressures

At current valuations, stock is trading at or below its long term averages

Deutsche Bank on pharma

India business is our preferred exposure; signs of stability in the US

Prescription share gains to continue for Indian companies

Operating leverage to drive earnings growth of 20% over FY19-21

Return ratios are set to improve as capex intensity moderates

Top picks are Torrent Pharma, Aurobindo & Cipla

Forecast a 13% CAGR for India revenues over the next two years

Buy call on Aurobindo, Cipla, Torrent; Hold on Sun Pharma, Lupin & DRL

HSBC on MPC minutes

MPC members agreed that growth is slowing & inflation is soft

There were varying opinions on India's fiscal policy

Budget will be watched carefully

Expect next 25 bps rate cut in 2019-end, taking repo rate to 5.5%

Expect growth to remain weak at sub-6% in the April-June quarter

Expect growth to inch up towards 7% in H2CY19

Inflation is likely to remain under the 4% target this year

Morgan Stanley on IT

Visa issue has been a risk for quite some time

Indian cos will find tough to meet demand & maintain margin if cap imposed

Dependence on external consultants may further increase

Dependence on external consultants may be negative for margin

Citi on IT

Gap of 7,000-8,000 visas for the bigger users can be meaningful

Workflow & process uncertainty can hurt service quality

Proposed changes won’t affect BPO cos like WNS, EXL or Genpact

Impact is primarily for companies that use the H-1B as a ‘Need’

Credit Suisse on IT

Cap of 10-15%, if imposed, will severely curtail onsite project delivery

Historically, Indian IT professionals have taken up nearly 70% of annual quota

Probability of such a drastic change being implemented is low

Localisation initiatives need to continue longer & it does not bode well for margin

Morgan Stanley on Godrej Properties

Downgrade to underweight from equal-weight, target raised to Rs 802 from Rs 707 per share

Current valuation appears ahead of fundamentals

Morgan Stanley on MPC minutes

MPC appears to give more weight to growth amid low inflation risks

See the possibility of two more rate cuts in 2019

Growth concerns dominate as inflation is expected to be well managed

MPC members indicate that they will be ready to act if data demands

Acharya is concerned regarding impact of fiscal slippage on inflation outlook

Deutsche Bank on UPL

Maintain buy call, target at Rs 1,050 per share

Biz outlook strong & sharp; correction a buying opportunity

Stock correction not backed by any change in fundamentals

Technical Analyst, Prakash Gaba:

The Nifty unfolded and traded volatile and to bounce back achieving our target of 11,818 and has closed in the green. Technically now upside to 11,872-11,927-11,968 is a possibility as long as 11,606 holds.

The Nifty Bank unfolded and traded volatile to bounce back achieving our target of 30,819 and has closed in the green. Technically now upside to 31,003-31,187 is a possibility as long as 30,155 holds.

Wall Street ends higher: The benchmark S&P 500 index hit a record high on Thursday as an almost giddy euphoria over the prospects of a U.S. interest rate cut fueled the appetite for equities, but there are plenty of pitfalls that could throw the stock market off course.

SGX Nifty: Trends on SGX Nifty indicate a flat opening for the broader indices in India, a fall of 3.50 points or 0.03 percent. Nifty futures were trading around 11,861.50-level on the Singaporean Exchange.