Nifty ends at 7702, Sensex tanks 220 points; TCS, ITC gainers

08 Dec 2015

3:30 pm Market closing: The market has ended in green sparked by late sell-off. The Sensex ended down 219.78 points or 0.9 percent at 25310.33 and the Nifty slipped 63.70 points or 0.8 percent at 7701.70. About 887 shares advanced, 1875 shares declined, and 143 shares were unchanged.

Tata Motors, ITC, TCS, NTPC and Bajaj Auto were top gainers in the Sensex while Vedanta, GAIL, Hindalco, Tata Steel and ONGC were major losers.

3:05 pm Market Update: Equity benchmarks extended losses in afternoon trade with the Sensex falling 227.36 points or 0.89 percent to 25302.75 and the Nifty down 66.55 points or 0.86 percent to 7698.85 on further fall in European markets.

About 846 shares have advanced, 1894 shares declined, and 137 shares are unchanged on the BSE.

2:50 pm Dabur launch: FMCG firm Dabur India today launched the sugar-free version of its popular ayurvedic product chyawanprash to tap health conscious customers.

Dabur has roped in Bollywood actor Anil Kapoor as the brand ambassador for 'Dabur Ratnaprash SugarFree'.

"Enriched with the power of potent Ayurvedic ingredients like moti, kesar, musali, Dabur Ratnaprash SugarFree has been specially developed for those who feel the need help to rebuild strength, stamina, vigour, vitality and energy that's drained by the stress of day-to-day living," Dabur said in a statement.

2:35 pm Fitch on India: A greater than expected reduction in sovereign debt, fiscal consolidation and an improving business environment will be required for India's credit rating to be upgrades, says Thomas Rookmaaker, Director of Fitch Ratings.

The ambitious goods and services tax (GST) going through will also serve as a credit-positive, he adds.

In an interview with CNBC-TV18, Rookmaaker, however, said that while this year's 3.9 percent fiscal deficit target looked achievable but in the next fiscal, there will be challenges from the implementation of the 7th Pay Commission's recommendations.

"The government will have to increase revenues through revenue generating reforms to meet deficit target going ahead," he said.

2:20 pm Sugar subsidy: Sugar mills are prioritising exports of low-quality white sugar and could focus on raw sugar exports early in 2016 after the government confirmed it will pay a cane production subsidy, European traders said on Monday.

An official notification published in the Gazette of India, dated December 2, confirmed a cane production subsidy will be payable to farmers after mills export 80 percent of their quotas. The subsidy will be 45 Indian rupees (USD 0.7) per tonne.

India is the world's No. 2 sugar producer, behind Brazil.

European traders said that for now, Indian mills were exporting low quality whites to markets such as East Africa, the Middle East and the Indian Ocean, offered at around USD 375 per tonne FOB.

2:00 pm Market Check
The market remained under pressure in afternoon trade with the Sensex down 122.54 points to 25407.57 and the Nifty falling 28.10 points to 7737.30. The broader markets extended losses as the BSE Midcap and Smallcap indices fell 0.6 percent each.

The market breadth was weak as about 1,656 shares declined against 1,005 advancing shares on the BSE.

Crude prices edged away from nearly seven-year lows on Tuesday as China reported strong commodity imports despite economic weakness, but overall the market remained weak due to global oversupply compounded by OPEC's decision to keep output high. NYMEX crude gained 0.4 percent to USD 37.79 a barrel and Brent crude rose 0.6 percent to USD 40.98 per barrel.

European equities were marginally lower amid a continued rout in oil prices.

1:50 pm Buzzing: Unichem Laboratories has received final approval from the US health regulator to market generic Irbesartan tablets, used in treating hypertension, in the American market.

The company has received final abbreviated new drug application (ANDA) approval from the US Food and Drug Administration (USFDA) for Irbesartan tablets, Unichem Laboratories said in a filing to the BSE.

The tablets are therapeutically equivalent to Sanofi- -aventis's Avapro tablets, which are indicated for the treatment of hypertension. It is also used for the treatment of diabetic nephropathy.

1:30 pm Sugar: Sugar mills are prioritising exports of low-quality white sugar and could focus on raw sugar exports early in 2016 after the government confirmed it will pay a cane production subsidy, European traders said on Monday.

An official notification published in the Gazette of India, dated December 2, confirmed a cane production subsidy will be payable to farmers after mills export 80 percent of their quotas. The subsidy will be 45 Indian rupees (USD 0.7) per tonne.

India is the world's No. 2 sugar producer, behind Brazil.

European traders said that for now, Indian mills were exporting low quality whites to markets such as East Africa, the Middle East and the Indian Ocean, offered at around USD 375 per tonne FOB.

The market is still down as the Sensex slips 106.27 points or 0.4 percent at 25423.84. The Nifty is down 25.45 points or 0.3 percent at 7739.95. About 1028 shares have advanced, 1575 shares declined, and 131 shares are unchanged.

Tata Motors, Infosys, ITC, Bajaj Auto and HUL are top gainers are top gainers while Vedanta, Hindalco, ONGC, GAIL and Dr Reddy's Labs are major losers.

The Reserve Bank of India (RBI) is looking into a provision it introduced in June to help lenders managed stressed assets, RBI's deputy governor SS Mundra said on Tuesday, arguing it was too soon to write off the debt-for-equity swap tool as a failure.

Strategic Debt Restructuring (SDR) aims to allow banks to take majority ownership of troubled firms and look for new owners. It allows banks to classify the debt in question as "standard", rather than bad, during the 18 month process.

To date, SDR has been invoked in 9 cases but none has yet sold assets or significantly reduced debt.

12:55 pm Market Update: Equity benchmarks continued to see selling pressure. The Sensex declined 128.29 points to 25401.82 and the Nifty fell 33.55 points to 7731.85.

About 1001 shares have advanced, 1530 shares declined, and 139 shares are unchanged on the BSE.

12:45 pm Eicher Motors production loss: Eicher Motors today said it has suffered a production loss of 11,200 Royal Enfield motorcycles so far due to heavy rains and flooding in Chennai.

"Due to heavy rains and flooding in Chennai, both of Royal Enfield's production facilities in Thiruvottiyur and Oragadam were shut since December 1, 2015."

"The company resumed production of motorcycles on December 7, 2015. However, due to a high rate of absenteeism by the company's employees and issues with our local suppliers, the company will be running at approximately 50 percent capacity this week, and plans to be back up to 100 percent capacity by next week," Eicher Motors Ltd said in a regulatory filing.

12:30 pm IPO opens: The Rs 638-crore public issue of Dr Lal Pathlabs has opened for subscription today. It has fixed price band at Rs 540-550 a share.

It is an offer for sale issue of 1.16 crore equity shares by promoter and promoter group including Dr Arvind Lal (12,61,996 equity shares), Dr Vandana Lal (20,56,747 shares), Eskay House (2,38,226 shares) and Anjaneya Lal (550,386 shares).

Among investor selling shareholders, Wagner will dilute 58,60,000 shares, Westbridge Crossover Fund, LLC 14,71,575 shares and Sanjeevini Investment Holdings 1,61,070 equity shares.

The Delhi-based diagnostic and related healthcare tests & services provider will not get any proceeds from this issue.

12:15 pm FII View: Indian shares are likely to follow a sideways trend in the near term in the absence of a real recovery in earnings, which will likely turn only in the second half of the next fiscal (FY17), says Gautam Chhaochharia, Head of India Research at UBS Securities.

In an interview with CNBC-TV18, Chhaochharia said the market was unlikely to test recent highs or lows in the near term as disinflationary pressures would keep a lid on earnings even as there will likely not be a fiscal or monetary expansion.

He also played down the impact that GST may have on the stock market's fortunes in the near term, saying tangible benefits from the proposed tax -- whose rollout data too is as yet unclear -- will likely flow only over a two-three year period.

The market remained under pressure in noon trade following correction in Asian equities and oil prices. The Sensex fell 108.42 points to 25421.69 and the Nifty declined 26.20 points to 7739.20 due to selling in banking & financials, oil, metals and infra stocks.

The broader markets also caught in bear grip with the BSE Midcap and Smallcap indices falling 0.4 percent each. The market breadth was weak as about 1396 shares declined against 1396 advancing shares on the BSE.

Oil prices bounced back marginally today after hitting seven-year low in previous session as OPEC continues to pump near record oil to defend market share, compounding a glut that is seeing hundreds of thousands of barrels produced every day in excess of demand.

Benchmark Brent and WTI futures both fell over 6 percent in previous session to reach 2015 lows, and they are closing in on levels last seen during the credit crunch of 2008/2009.

11:45 am Interview: Securities and Exchange Board of India (SEBI) to buyback 9 lakh shares at a price sub Rs 500 per share.

Speaking to CNBC-TV18, Vinati Saraf Mutreja, Executive Director of the company said that this had been done to increase promoters stake to 75 percent from the current 72 percent. FCCB conversion had led to dilution in stake, she added.

Talking about the company's performance, Mutrja said that falling crude prices have impacted revenues, but margins have been retained at similar levels. Most of the inputs for the company are crude enabled, she said.

11:30 am Buzzing: Shares of Tata Motors gained nearly 2 percent intraday on strong retail sales in November by its UK subsidiary and luxury car maker. Jaguar Land Rover on Monday reported its best ever November retail sales of 46,547 vehicles, up 27 percent (12 percent up M-o-M) compared to November 2014 on strong performance of the UK and European markets, the company said in its statement. Retail sales were up 70 percent in the UK, 68 percent up in Europe, 52 percent up in North America and 8 percent up year-on-year in other overseas markets while retail volumes in China were down 22 percent for the month, reflecting slowdown in the economy.

The market continues to struggle as the Nifty finds it difficult to stay above 7750. The 50-share index is down 19.85 points or 0.3 percent at 7745.55. The Sensex is down 87.04 points or 0.3 percent at 25443.07. About 1105 shares have advanced, 1151 shares declined, and 121 shares are unchanged.

Vedanta, Hindalco, GAIL, ONGC and Dr Reddy's Labs are major losers while Tata Motors, Infosys, ITC, TCS and HUL are top gainers in the Sensex.

Gold struggled to recover from overnight losses on expectations of a Federal Reserve rate hike next week and a robust dollar. The dollar extended gains against a basket of major currencies on Monday, helped by the jobs data and the looming rate hike, further weighing on bullion. Higher rates tend to drag on non-interest-paying gold by increasing the opportunity cost of holding it, while boosting the dollar.

Oil prices skidded to their lowest level in nearly seven years on Monday as a global glut showed no signs of abating.

10:55 am Market outlook: Indian shares are likely to follow a sideways trend in the near term in the absence of a real recovery in earnings, which will likely turn only in the second half of the next fiscal (FY17), says Gautam Chhaochharia, Head of India Research at UBS Securities. In an interview with CNBC-TV18, Chhaochharia said the market was unlikely to test recent highs or lows in the near term as disinflationary pressures would keep a lid on earnings even as there will likely not be a fiscal or monetary expansion. He also played down the impact that GST may have on the stock market's fortunes in the near term, saying tangible benefits from the proposed tax -- whose rollout data too is as yet unclear -- will likely flow only over a two-three year period.

10:45 am GST: Ahead of the Parliament session, the Opposition is gearing to corner the Centre again on a host of issues.

The BJP Parliamentary Party will meet to devise a strategy to gain support for the passage of the Goods and Services Tax Bill. The Congress has made it clear that it will not compromise on its demand for dropping the proposed one per cent additional levy to compensate manufacturing states.

The Congress on Monday put the onus of ensuring passage of the GST Bill on the government, saying it is yet to revert to the opposition parties on their concerns.

"Ball is in their court. Government has to take a call and revert to opposition parties as to how GST Bill does not become a kill-GST Bill but rather remains an effective GST Bill," Congress chief spokesperson Randeep Surjewala said.

10:30 am Downgrade: Rating agency ICRA has downgraded the rating on the proposed Rs 750-crore non-convertible debenture programme of Eros International Media Ltd citing concerns of parent company's reduced financial flexibility and also revised outlook to negative from positive. ICRA said it has revised the the rating on Eros' NCD programme to A+ from AA-. The outlook on the rating has been revised to 'negative' from 'stable', the rating agency said in a statement. In a BSE filing, Eros said it has not issued any Non- Convertible Debentures (NCD) till date.

The market is still flat as the Sensex is down 12.45 points at 25517.66. The Nifty is up 2.45 points at 7767.85. About 1055 shares have advanced, 818 shares declined, and 97 shares are unchanged.

Tata Motors, Infosys, ITC, TCS and HUL are top gainers in the Sensex. Among the losers are Vedanta, ONGC, Hindalco, Coal India and Dr Reddys Labs.

Ridham Desai, Morgan Stanley says he thinks consumption, both rural and urban, is likely to pick up pace in the coming months. Thus he is adding exposure to both rural and urban consumption via Mahindra & Mahindra and Coffee Day Enterprises.

Morgan Stanley's global forex team is bullish on the Yen, which is not good news for Maruti Suzuki, even though its domestic sales growth should remain supported in a consumption recovery, he says.

9:55 am FII View: Ridham Desai, Morgan Stanley says he thinks consumption, both rural and urban, is likely to pick up pace in the coming months. Thus he is adding exposure to both rural and urban consumption via Mahindra & Mahindra and Coffee Day Enterprises.

Morgan Stanley's global forex team is bullish on the Yen, which is not good news for Maruti Suzuki, even though its domestic sales growth should remain supported in a consumption recovery, he says.

Desai is bullish on the USD and prefer to play this via technology stocks rather than pharmaceutical stocks. Thus, he adds HCL Technologies at the expense of Dr Reddy's Labs, which was recently downgraded to equalweight.

9:40 am Buzzing: Shares of IRB Infrastructure Developers gained more than 1 percent intraday on getting provisional completion certificate for Ahmedabad-Vadodara road project.

"IRB Ahmedabad Vadodara Super Express Tollway Private Limited (SPV), the wholly owned subsidiary, has been issued a provisional completion certificate by the competent authority on December 4," says the Mumbai-based road developer in its filing.

Consequently, the SPV has started toll collection on NH-8 arm of this project from December 6, it adds.

The SPV is already collecting toll on Ahmedabad Vadodara Expressway (NE- 1) arm since January 2013.

9:30 am Alkem IPO: Alkem Laboratories has received Rs 395.5 crore from anchor investors on Monday, a day before the issue opening. It has finalised allocation of 37,66,358 equity shares at upper end of the price band of Rs 1,020-1,050 per equity share to anchor investors.

There are 25 anchor investors, including Abu Dhabi Investment Authority, DSP Blackrock Mutual Fund, Morgan Stanley Mauritius Company, Apax Global Alpha, SBI Mutual Fund, Kuwait Investment AuthorityGrandeur Peak International Opportunities Fund, DB International (Asia), Axis Mutual Fund, ICICI Prudential Top 100 Fund, IDFC Classic Equity Fund, Kotak Mahindra (UK) etc.

The 1.28 crore public issue will open for subscription during December 8-10. It is an offer for sale by selling shareholders. The offer will constitute up to 10.75 percent of the post-offer paid-up equity share capital of the company.

9:15 am Market Check
The market has opened marginally lower, tracking negative global cues due to sharp fall in oil prices. The Sensex fell 91.10 points to 25439.01 and the Nifty declined 22.30 points to 7743.10.

Dr Reddy's Labs, Vedanta, HDFC, ONGC, Hindalco, Cairn India and Adani Ports declined 1-2 percent while Tata Motors, Hero Motocorp, Infosys, Bajaj Auto, Wipro, BPCL, HCL Tech and Asian Paints gained 0.2-1 percent.

The Indian rupee declined in the early trade today. It has opened lower by 12 paise at 66.85 per dollar versus 66.73 Monday.

Ashutosh Raina of HDFC Bank said, "The slide in oil prices has resulted in re-emergence of dollar buying after Organization of the Petroleum Exporting Countries (OPEC) failed to agree on production cut last week. The US Fed is widely expected to raise rates at the next week's Federal Open Market Committee (FOMC) meeting after a solid jobs growth in November."

He further added, "The USD-INR pair after touching the recent lows of 67/dollar has been helped by some aggressive intervention from Reserve Bank of India (RBI). The pair is expected to trade in the 66.50-67.50/dollar range going into FOMC meeting next week."

The dollar rose broadly on expectations the US Federal Reserve is on track to raise interest rates next week following a solid November jobs report.

Asian shares too are trading weak, despite Japan posting positive quarterly GDP data (1 percent) that were ahead of estimates. US stocks fell on Monday, led by the S&P energy index's biggest one-day percentage drop since late August as oil prices slid to their lowest point in nearly seven years.

The Dow Jones industrial average fell 117.12 points, or 0.66 percent, to 17,730.51, the S&P 500 lost 14.62 points, or 0.7 percent, to 2,077.07 and the Nasdaq Composite dropped 40.46 points, or 0.79 percent, to 5,101.81.

Oil fell to about USD 38 on Nymex futures, as OPEC failed to take action to cut supply. While low oil prices are generally considered to be good for consumption, and thereby equities, experts believe that very low oil prices may not be good for the health of the global economy.