Sensex falls for 2nd consecutive day; Metal index dips 1%

24 Jun 2019

Market Closing

Benchmark indices closed lower for second consecutive day amid liquidity crisis and weak global cues.

The Sensex fell 71.53 points to 39,122.96 and the Nifty declined 24.40 points to 11,699.70. The Nifty Midcap and Smallcap indices dropped 0.4 percent each.

UPL, Yes Bank, M&M, Indiabulls Housing and TCS were top gainers among Nifty50 stocks, rising 1-5 percent whereas JSW Steel, ONGC, Eicher Motors, Tata Steel and Vedanta fell 2-3 percent.

Reliance Power, PC Jeweller, IFCI, Glenmark Pharma, Mahanagar Gas, IGL, Gujarat Gas, Motherson Sumi, Cadila Healthcare, Edelweiss FInancial and Dish TV were down 3-12 percent.

Jain Irrigation, HDIL, DHFL, Zee Media, BHEL and NBCC rallied 3-14 percent.

KPR Agrochem:

Andhra Pradesh based agri-input company KPR Agrochem is set to launch its initial public offering for subscription on June 28. Its price band is fixed at Rs 59-61 per share.

The IPO will consist of a fresh issue aggregating upto Rs 210 crore and an offer for sale of 1.2 crore equity shares.

Future Enterprises To Issue NCDs

Company in its BSE filing said it approved enabling resolution giving authority to issue of Secured Redeemable Non-Convertible Debentures (NCDs) on private placement basis, for a value upto around Rs 900 crore, in one or more tranches.

It will replace few of its high cost current or near term maturity debts as well as to meet further funds requirements.

DHFL In Focus:

To work out a rescue package for Dewan Housing Finance Corporation (DHFL), its lenders will meet in the first week of July, reports Business Standard. The key talking points of the meeting will include restructuring of loans to ensure repayment, fresh working capital support, inducting a new financial investor and a new management team to be put in place.

Market Outlook

"We do not expect any relief from volatility front in the coming week too, thanks to scheduled derivatives expiry. Meanwhile, participants will be eyeing G20 summit on June 28-29, hoping some resolution on prevailing trade war. On data front, they will also keep a tab on Core sector data, which will be unveiled on June 28," Jayant Manglik, President, Religare Broking told Moneycontrol.

Besides, progress of monsoon and crude oil movement will remain on traders’ radar, he said.

Nifty has next crucial support at 11,600 and its breakdown could lead to further decline ahead. In case of rebound, 11,800-11,900 zone would act as hurdle, he added.

Viral Acharya Resigns

RBI confirmed that a few weeks ago, Dr Viral Acharya submitted a letter to the central bank informing that due to unavoidable personal circumstances, he is unable to continue his term as a Deputy Governor of the RBI beyond July 23, 2019.

Consequential action arising from his letter is under consideration of the Competent Authority, the central bank said.

Market Outlook

Ashish Nanda EVP & Business Head - PCG, Commodities and Currency Business, Kotak Securities said in the previous week, the market took a proper test of every trader and showed them, where they stand. "The market tested the traders in terms of patience, confidence, courage and execution."

He is not expecting Nifty to close below 11600, rather he expects strong bounce back if Nifty falls in the region of 11,680/11,650 levels in next one to two days.

Option data is turning neutral to positive for long traders, who should be ready to capitalise if Nifty forms reversal formation, Nanda said.

Management Interview

L&T Power management told CNBC-TV18 that the segment received an EPC order in thermal power space after 3 years. "Buxar plant has to be completed over 48 months. All approvals are already in place and we will mobilise resources over next one month."

The company expects rapid industrialisation over next 5 years and will have to add 37 GW capacity by 2023. It expects 6-7 GW capacity to be added annually over next 2-3 years.

Jet Airways in Action:

After the appointment of Interim Resolution Professional, the power of board members at Jet Airways suspended, reports CNBC-TV18.

Resolution professional Ashish Chhawchharia invited claims from creditors by July 4.

Goldman Sachs on L&T

While maintaining buy call on L&T being on conviction list with a target price at Rs 1,700, Goldman Sachs said company continued to show strength in core business and vigour in non-core business. "In bull-case scenario, we 26 percent upside from current levels.

Lupin in Focus

Japanese brokerage Nomura also maintained its buy call on Lupin with a price target at Rs 1,017 as it expects trend of consolidation in pharma to continue.

Domestic market growth remained challenging and there’s limited scope for new product introductions, it said, adding it sees strategic rationale in acquiring JB Chemicals.

Last week, a media report had indicated that Lupin and Piramal Enterprises are in race for buying stake in JB Chemicals but company denied.

IndiaMart InterMesh:

IndiaMart InterMesh, the first mainboard IPO in last two months, opened for subscription with a price band of Rs 970-973 per share.

The company, which is the largest online B2B marketplace for business products and services, aims to raise Rs 475 crore through the public issue that will close on June 26.

It is an offer for sale of 48,87,862 shares by its promoters and investors, so company will not get any proceeds from public issue.

Market Opening:

Benchmark indices opened flat with Sensex falling 6.65 points to 39,187.84 and the Nifty rising 11.10 points to 11,735.20.

Yes Bank, IndusInd Bank, L&T, UPL, Bharti Airtel and Zee Entertainment are early gainers while Dr Reddy's Labs, Tech Mahindra, Bhart Infratel, Reliance Industries, Hero Motocorp, Axis Bank, and Indiabulls Housing Finance were losers.

Nifty Bank gained 0.3 percent.

Nifty Midcap index was up 20 points. CG Power, Bandhan Bank, Balrampur Chini, Dhampur Sugar and JMC Projects gained 1-8 percent.

Reliance Capital, Sobha, Motherson Sumi and Glenmark Pharma were under pressure.

Rupee Opening:

Indian rupee opened at 69.60 against the US dollar on June 24, falling 5 paise compared to Friday's close of 69.55 a dollar.

RBI Deputy Governor Viral Acharya resigns 6 months before term ends:

Reserve Bank of India’s (RBI) Deputy Governor Viral Acharya is said to have quit six months before the scheduled end of his term to return to New York University Stern School of Business (NYU stern) in August as CV Starr Professor of Economics.

Acharya had put in his papers a few weeks before the last meeting of RBI’s Monetary Policy Committee (MPC) that was held on June 6, sources told Business Standard. His last day will be a few days before the end of July, the report added.