Sensex falls 261 points; OMCs take a beating, Titan up 2%
16 September 2019
Market Update: Indian indices ended lower but off day's low with Nifty able to hold above 11,000 level.
At close, the Sensex was down 261.68 points at 37,123.31, while Nifty was down 72.40 points at 11,003.50. About 1360 shares have advanced, 1137 shares declined, and 169 shares are unchanged.
BPCL, M&M, SBI, UPL and Yes Bank were among major losers on the Nifty, while gainers include Titan Company, Britannia Industries, Tech Mahindra, Coal India and Nestle India.
Among sectors, selling seen in the oil & gas, bank, auto, energy and infra, while buying seen in the FMCG and pharma. Smallcap index gains 0.5 percent, while midcap ended lower.
Market Update: Indian indices are witnessing a rangebound movement on September 16 with Nifty hovering around 11,000.
The Sensex is down 212.80 points or 0.57% at 37,172.19, while Nifty is down 64.60 points or 0.58% at 11,011.30. About 1225 shares have advanced, 1085 shares declined, and 130 shares are unchanged.
Gold Update: Gold prices jumped 1 percent on Monday as an attack on Saudi Arabia's oil facilities dented risk appetite, boosting demand for the safe-haven bullion, while investors awaited for clues on monetary easing from major central bank meetings due this week.
OnMobile Global Locked in 20% Upper Circuit
Shares of OnMobile Global were locked in 20 percent upper circuit at Rs 39.30 after promoter signed agreemend to sell stake in company to Jump Networks.
OnMobile Systems Inc (OMSI) is the promoter of OnMobile Global and currently holds 48.18 percent of the total issued and paid-up share capital of company.
Company said OMSI has entered into a share purchase agreement with Jump Networks for the sale of its 1.9 crore equity shares at a price ranging from Rs 75.50-78 per share.
Weakness in Rupee Could Give More Strength To Gold
Gold prices shows strength after drone strike on Saudi Arabia on last Saturday. Prices crossed $1500 per troy ounce at Comex division and test 38,000 levels at MCX.
Ahead of US federal reserve policy meet this week, geo-political tensions between Iran and Saudi Arabia and rising tensions in Hong Kong will support gold prices, said Manoj Kumar Jain, Director at IndiaNivesh Commodities who expects gold prices remain firm and could test $1,520-1,524 at Comex division while at MCX prices are expected to test 38,330-38,400 in one or two trading sessions.
Further weakness in rupee could give more strength to gold in domestic markets and if rupee weaken below 72 levels then gold will cross 38500 again. Trend looks positive for next one-two trading sessions, he said.
ICICI Directs Advises Buying Tata Chemicals
ICICI direct expects incremental utilisation of new capex at India basic chemical unit along with emerging businesses like HDS, nutrition to drive the performance. Furthermore, the nutrition business has return on capital employed (RoCE) of 18-20 percent against base business RoCE of around 10 percent, it said.
Thus, increasing contribution from nutrition is expected to drive group return rations and thereby valuations, according to the brokerage house.
Apart from this, it believes demerger of consumer business provides base business of TCL at Rs 301 per share against fair value of Rs 395 per share. It has a buy rating on Tata Chemicals.
Buzzing: Shares Emami Paper Mills declined 5 percent on September 16 after company surrendered its plots allotted by GIDC.
Karan Shah, DGM- Commodity & Currency Research, Indiabulls Ventures:
Oil prices witnessed its biggest intra-day percentage gain since the start of the Gulf War in 1991, after an attack on Saudi Arabian oil facilities shut in the equivalent of 5% of global supply. The commodity which was struggling to hold grounds despite the OPEC production cut also affected by the slowing global economy amid the trade tensions between US & China traded higher by over 9% today.
The attack not only wiped out a portion of supply from the global markets but also raises Global tensions which may now keep the prices inflated. Tensions rose as Donald Trump said on Sunday the US was "locked and loaded" for a potential response to the attack on Saudi Arabia's oil facilities. Looking at the new emerging factors a buy on dip strategy should be appropriate for the near term.
The above event may act negatively for India which imports the majority of the commodity to meet its demand. Crude contributes a major chunk to India's import bill. Higher crude prices may result in rupee depreciation against the dollar. We expect spot USD-INR to trade higher within a range of 70.8-71.9 for the immediate near term.
Market Update: Benchmark indices are trading lower with Nifty holding above 11,000 mark. Midcap and smallcap are recovered from the low and trading marginally higher.
The Sensex is down 127.32 points or 0.34% at 37257.67, and the Nifty down 37.80 points or 0.34% at 11038.10.
Buzzing: Shares of Colgate Palmolive gained 6 percent on September 16 as foreign brokerage house Credit Suisse expect 15 percent upside in the share price
Bharat Electronics climbs 4%: Shares of Bharat Electronics rallied more than 4 percent on September 16 after Morgan Stanley expects the stock price to rise relative to Country Index. The stock rallied more than 30 percent in last nine months amid defence orders from government.
Glenmark Gains 2%
Glenmark Pharma shares gained more than 2 percent after souces told CNBC-TV18 that the US Food and Drug Administration inspected company's Indore unit last week.
The US health regulator issued no observations to Indore unit.
Pritam Kumar Patnaik, Head Commodities, Reliance Commodities:
The Drone attack on Saudi Aramco oil facilities on Saturday is estimated to impact 5 mln bpd of oil production and further news that Saudi Arabia plans to shut down about half of it's output after strike will have impact on the overall oil prices and global economy. The impact of the same has been already witnessed on both NYMEX and Brent oil prices, which have rallied more than 10%.
The immediate range for Nymex crude will be USD 56 to 63 per barrel. With USA accusing the Iranian government of orchestrating the attack and Iran in turn threatening war, there by further destabilising the region at large and further impacting future supplies, the oil prices are expected to remain firm.
Ajit Mishra Vice President, Research, Religare Broking:
In the coming week, participants will be eyeing WPI inflation data and GST Council meet which are scheduled on September 16 and September 20 respectively. On the global front, the US Fed will announce its policy decision on September 18 and participants are hopeful of further easing, citing mixed macroeconomic data.
The cues are in the favour of further rebound and we expect Nifty to test 11,150 shortly. In case it managed to sustain above that mark, it has the potential to reach 11,250-11,300 zone but that would be tough to break. On downside, 10,800 would act as strong support. Since we’re seeing mixed trend within the sectors, we reiterate our view focusing more on stock selection and trade management. We believe rate-sensitive viz. private banks, auto, financials could outshine the others while defensive like FMCG and pharma may continue to underperform.
Equitas Holdings tumbles 16%: Share price of Equitas Holdings tumbled over 16 percent on September 16 after market regulator returned the company's draft scheme.
Market Opens: It is weak start for the market on Monday with Nifty around 11,000 level.
The Sensex is down 176.72 points at 37,208.27, while Nifty is down 60.90 points at 11,015. About 332 shares have advanced, 502 shares declined, and 63 shares are unchanged.
BPCL, IOC, HPCL, Asian Paints, Yes Bank, RIL, UPL, Tata Motors, L&T, M&M, SBI, Equitas Holdings are among major losers on the indices, while gainers are Indiabulls Housing, HUDCO, BEL, ONGC and GAIL.
Among sectors, except FMCG and IT other indices are trading in the red. Midcap and smallcap also trading lower.
Rupee Opens: The Indian rupee slipped in the early trade on Monday. It has opened lower by 70 paise at 71.62 per dollar versus Friday's close 70.92.
Market at pre-open: Indian indices are trading lower in the pre-opening session with Nifty below 11,000
At 09:02 hrs IST, the Sensex is down 663.88 points or 1.78% at 36721.11, and the Nifty down 194.00 points or 1.75% at 10881.90.
Market Headstart: Nifty likely to retest 11K on crude oil woes; Tata Steel, Bharat Forge top buys
Trends on SGX Nifty indicate a gap-down opening for the broader index in India, with a 100 points loss or 0.90 percent. Nifty futures were trading around 11,011-level on the Singaporean Exchange.
Morgan Stanley on BEL
Overweight rating on the stock with target at Rs 116 per share
Believe company’s share price will rise relative to the country index over next 60 days
Contract for 7 squadrons of Akash missiles over 3 years improves earnings visibility
Await clarity, whether annual maintenance contract is over & above the contract value declared
Jefferies on IGL
Maintain hold; valuations at 24x FY20E P/E factoring in a favourable policy environment
Delhi announced 4th iteration of the odd-even rule from Nov 4-15
Exemption of CNG vehicles (like in the past) to bode well for CNG conversions
Credit Suisse on Colgate
Maintain outperform rating; target at Rs 1,450 per share
Task of arresting the steep fall in market share has been achieved in the past year
Market share gains are yet to start accruing to Colgate
CLSA on India Strategy
Government’s follow-up measures unlikely to give a big eco push
Demand improvement measures for real estate are lacking which is disappointing
Government has continued to refrain from any significant fiscal support of the economy
Upcoming GST council meeting on the 20th will gain importance
Credit Suisse on Oil
Even before Saudi’s supply disruption, global oil markets were poised for a tighter H2FY19
Energy sector, after underperforming 8MFY20, is starting to outperform in September
Believe improved fundamentals should trigger re-rating as expectations are low
Morgan Stanley on Economy
Government continues with calibrated approach – focus on exports & housing
Focus on the export sector is a step in the right direction
Need to now focus on increasing competitiveness in domestic exports industry
Focus on the real estate sector is much needed
Provision of special window for last-mile funding for housing projects was long awaited
Jefferies on Oil
Drone attacks on key Saudi's Oil infra have taken over 5% of global oil
Greater risk premium is still likely even after facilities come back on
In India, ONGC & Oil India will benefit but the OMCs may suffer
Continue to like the inexpensive IOC, & Petronet LNG & GAIL
Wall Street ends mixed on Friday: The S&P 500 ended the day down slightly on Friday but less than 1% below its all-time high as a drop in Apple stock countered cooling US-China trade tensions
China August industrial output: China’s industrial production growth skidded to its weakest pace in 17 years and a half in August, expanding just 4.4 percent year-on-year, signaling further weakness in an economy hit by the trade war and slowing demand.
Crude at 6-month high: Oil prices surged to six-month highs on Monday while Wall Street futures fell and safe-haven bets returned after weekend attacks on Saudi Arabia’s crude facilities knocked out more than 5 percent of global oil supply.
SGX Nifty: Trends on SGX Nifty indicate a negative opening for the broader indices in India, a fall of 101.50 points or 0.91 percent. Nifty futures were trading around 11,009.50-level on the Singaporean Exchange.