Nifty ends below 8650, Sensex in red; Tata Steel, Coal India up

17 Aug 2016

3:30 pm Market closing: The market has ended in red after a lot of struggle. The Sensex is down 59.24 points or 0.2 percent at 28005.37 and the Nifty is down 18.50 points or 0.2 percent at 8624.05. About 1458 shares have advanced, 1259 shares declined, and 171 shares are unchanged.

Tata Steel, Coal India, Bajaj Auto, Hero MotoCorp and Axis Bank were top gainers while Adani Ports, TCS, Asian Paints, Wipro and Infosys were gainers in the Sensex.

3:20 pm Gold Update: Gold advanced for the third day, gaining Rs 20 to Rs 31,150 per ten grams at the bullion market today on sustained buying by jewellers to meet festive season demand from retailers, even as the metal weakened overseas.

Silver, however, fell by Rs 350 to Rs 46,650 per kg.

Marketmen said increased buying by jewellers to meet rising festive season demand from retailers at domestic spot market mainly kept gold prices higher.

However, a weak global trend where gold dropped ahead of the release of the Federal Reserve's minutes from its July meeting after central bank officials signalled that US interest rates could be increased at least once this year, capped the rise.

3:15 pm Earnings: Liquor firm Radico Khaitan today reported an increase of 25.2 per cent in its standalone net profit at Rs 21.5 crore for the first quarter ended June 2016.

For April-June of 2015-16, the figure stood at Rs 17.2 crore.

Total income from operations moved up 3.1 per cent to Rs 430.4 crore during the quarter under review as against Rs 417.3 crore in the same quarter of the previous fiscal, Radico Khaitan said in a regulatory filing to BSE.

Total expense during the period came in at Rs 384.5 crore as against Rs 381.7 crore a year before.

3:05 pm Market Update: Equity benchmarks were marginally lower amid consolidation. The Sensex was down 38.71 points at 28025.90 and the Nifty down 14.90 points at 8627.65.

The market breadth was positive as about 1410 shares advanced against 1259 declining shares on the BSE.

2:45 pm Buzzing:  Strides Shasun is going to hive off API business to wholly-owned subsidiary. The turnover of API business in FY16 was Rs 712.2 crore.

The company's Q1 net profit was at Rs 41.7 crore versus Rs 87.6 crore and total income was at Rs 870 crore versus Rs 955 crore.

The Sensex is down 60.26 points at 28004.35, and the Nifty down 25.60 points at 8616.95.

14:00 Market Update: The Sensex is down 49.08 points at 28015.53, and the Nifty down 22.15 points or 0.3 percent at 8620.40. About 1361 shares have advanced, 1164 shares declined, and 177 shares are unchanged.

Coal India, Hero MotoCorp, Tata Steel, Bajaj Auto and Axis Bank are gainers while TCS, Asian Paints, Infosys, Reliance and GAIL are losers in the Sensex. Sun Pharma, BF Utilities, Just Dial, Cipla and Reliance were most active shares on BSE.

In the currency market, the Japanese yen weakened against the dollar in the afternoon session. The yen touched an earlier session high of 100.14 and overnight, it climbed to levels around 99.68 to the dollar before retreating. That compared with levels above 101.00 last week.

Analysts told CNBC on Tuesday they expect further yen strength in the near future, following the market's disappointment with the Bank of Japan's (BOJ) stimulus plans.

1:55 pm Reinsurance rules: The new reinsurance rules will take effect in the coming months, but foreign reinsurance players are not happy over the new guidelines that were released by the Insurance Regulatory and Authority of India (IRDAI) last week.

CNBC-TV18's Yash Jain, quoting sources, says that foreign players like Swiss Re, Munich Re and Hannover RE have written to IRDAI seeking an overhaul.

The key contention in the case is the Right of First Refusal (ROFR), which will be granted to the Indian insurance companies. GIC Re will have the ROFR once the new guidelines kick-in.

In case the proposal of Indian insurance companies is rejected by GIC Re, then only these companies can go to the foreign counterparts. In case the GIC Re accepts their proposal, then Indian companies cannot go to any foreign reinsurer even if they are offered a better deal.

1:45 pm Realty woes: In fresh setback for Unitech, the Apex Court has directed the company to refund flat buyers for the unfinished project in Gurugram (earlier known as Gurgaon), reports CNBC-TV18.

Sources say the company has been directed to return Rs 15 crore to flat buyers including direct refunds of Rs 5 crore within 2 weeks and balance by end of September.

The National Consumer Disputes Redressal Commission (NCDRC) had allowed compensation to 38 flat buyers earlier against which Unitech had moved the Supreme Court.

1:30 pm Exclusive: Dish TV is in the final stages of acquiring Videocon D2H to create India's largest direct-to-home (DTH) player with almost 45 percent market share. Sources tell CNBC-TV18 it is likely to be a cash and share-swap deal and will be used to pay off lenders of debt-laden Videocon D2H, who have been skeptical over its ability to service the debt. Videocon D2H is listed on Nasdaq via American Depository Receipts (ADR) and by the way of this acquisition Dish TV will also get listed on Nasdaq.

The market is still struggling to make any meaningful gains today. The Sensex is down 21.05 points at 28043.56, and the Nifty down 12.95 points or 0.1 percent at 8629.60. About 1387 shares have advanced, 1098 shares declined, and 181 shares are unchanged.

Coal India, Hero MotoCorp, Tata Steel, Bajaj Auto and Axis Bank are top gainers while TCS, Asian Paints, Infosys, Reliance and Cipla are losers in the Sensex.

European stocks opened higher, ahead of the closely-watched release of the US Federal Reserve's latest minutes. Global markets are looking ahead to the release of the minutes from the Fed's meeting in July for clues on where the central bank might be heading in terms of the timing of interest rate rises.

12:55 pm RBS-Infosys deal fall out: Royal Bank of Scotland (RBS) has been a bank in trouble and calling off the deal with Infosys is a fallout of it says Ganesh Natarajan, Chairman of 5f World & Nasscom Foundation. He believes Brexit is not the underlying reason for cancellation of the deal.

Meanwhile, analysts tracking Infosys are working on the implications. Karan Taurani, Senior Analyst, Dolat Capital says Infosys is going to take a hit for about 3-4 quarters.

Not only Infosys, the entire IT services industry is going through a substantial transformation, says Natarajan. The need for manpower is going to lessen in the wake of automation for the clients the IT services industry caters to, he adds.

12:30 pm Boardroom: Just Dial has been paying the price for not expanding and executing on the sales side for the last 2 year says CFO Ramkumar Krishnamachari in an interview to CNBC-TV18 after the company posted weak earnings. The company's net profit for first quarter grew 7.9 percent year-on-year (YoY) to Rs 38.9 crore with total income growing 6.2 percent YoY at Rs 176.3 crore. Ebitda, however, dipped 35.2 percent YoY to Rs 29.3 crore with Ebitda margin plunging to multi-quarter lows of 16.6 percent from 27.2 percent in the same quarter last year. However, Krishnamachari says the company has taken corrective steps and it should start yielding results leading to double-digit revenue run rate starting from the third quarter this fiscal.

Investors seem to be in wait and watch mode. The Sensex is up 23.48 points at 28088.09, and the Nifty is down 0.30 points at 8642.25. About 1369 shares have advanced, 949 shares declined, and 156 shares are unchanged.

Coal India, Tata Steel, Hero MotoCorp, Axis Bank and Bajaj Auto are gainers while TCS, Asian Paints, Infosys, GAIL and L&T are losers in the Sensex.

Dish TV is up 3 percent as Dish TV is in the final stages of acquiring Videocon D2H to create India's largest direct-to-home (DTH) player with almost 45 percent market share. It is learnt that the deal is likely to be a cash and share-swap deal and will be used to pay off lenders of debt-laden Videocon D2H, who have been skeptical over its ability to service the debt.

The deal size as well as valuation for Videocon D2H is anticipated to be lower than USD one billion.

While previous bouts of strength in the yen have pushed Japanese manufacturers to shift production overseas, exporters are coping with the recent currency stresses by penny-pinching - turning off lights and cramming elevators in the hope that nothing more drastic will be needed before the tide turns.

The yen, a safe haven in troubled times, has been climbing in the unsettled period before and after Britain's June 23 vote to leave the European Union (Brexit) upset global markets, moving nearly 10 yen against the dollar since early June to just under 100.

11:45 am Market outlook: The current exuberance in the market is on back of global liquidity, says Prakash Kacholia, MD of Emkay Global. However, he adds that flows into India have been lower than what other Asian or emerging markets have been receiving. The Indian market is likely to continue its upward trend for the next 2-3 years. Investors will have to rummage through the overpriced pockets in the market, says Krishna Kumar Karwa, MD & CEO of Emkay. Like every year, Emkay Global is all set to organise the Emkay Confluence focus of which will be on domestic consumption. India, which is banking on rural recovery, will see many opportunities on the consumption side. Kacholia further says: ''You need to have guts to take contrarian bets in market.''

11:30 am Exclusive: Dish TV is in the final stages of acquiring Videocon D2H to create India's largest direct-to-home (DTH) player with almost 45 percent market share. Sources tell CNBC-TV18 it is likely to be a cash and share-swap deal and will be used to pay off lenders of debt-laden Videocon D2H, who have been skeptical over its ability to service the debt. Videocon D2H is listed on Nasdaq via American Depository Receipts (ADR) and by the way of this acquisition Dish TV will also get listed on Nasdaq.

The market is marginally higher with the Nifty hovering around 8650. The 50-share index is up 6.60 points at 8649.15 and the Sensex is up 51.46 points or 0.2 percent at 28116.07, and the Nifty. About 1349 shares have advanced, 806 shares declined, and 129 shares are unchanged.

Hero MotoCorp, Coal India, Tata Steel, Bajaj Auto, Axis Bank are top gainers while TCS, Infosys, GAIL, Asian Paints and L&T are losers in the Sensex.

Both Tree House Education and Zee Learn are up 18-19 percent. Tree House Education board has finally approved its revised merger deal with Zee Learn. The deal had hit a road block after Zee Learn had started 're-evaluating its merger with Tree House'. As per the new merger scheme, shareholders of Tree House will get shares in Zee Learn in ratio of 1:1. In a statement to the exchanges, Tree House said that the merger evaluation committee, formed in June by the companies, has approved of the new share swap ratio.

Oil prices fell as investors booked profits from recent gains, but stayed above USD 46 on hopes producers would decide to freeze output at a meeting next month.

Prices closed at five-week highs overnight, bolstered by a weaker dollar and after remarks by OPEC kingpin Saudi Arabia and non-OPEC rival Russia on cooperation to stabilise prices, which could include an output freeze.

US crude climbed 1.8 per cent to settle at USD 46.48 a barrel in New York and Brent also advanced 1.8 per cent to close at 49.23 in London yesterday.

10:50 am FPIs: Government debt securities attracted bids worth a staggering Rs 10,599 crore from foreign investors as against Rs 9,358 crore on offer in an online auction.

The auction was conducted on BSE's e-bidxchange platform from 1530 hrs to 1730 hrs after the close of market hours. At the end of the two-hour auction, 34 bids were declared successful out of 38.

The debt auction quota gives overseas investors the right to invest in the debt, up to the limit purchased.

The total investment in government debt (auction) had reached Rs 136,736 crore till July 21, which was 94.96 per cent of the total permitted limit of Rs 1.44 lakh crore, according to depositories data.

10:30 am Buzzing: Tree House Education board has finally approved its revised merger deal with Zee Learn . The deal had hit a road block after Zee Learn had started 're-evaluating its merger with Tree House'. As per the new merger scheme, shareholders of Tree House will get shares in Zee Learn in ratio of 1:1. In a statement to the exchanges, Tree House said that the merger evaluation committee, formed in June by the companies, has approved of the new share swap ratio. According to the earlier deal, Tree House's shareholders were to receive 53 fully paid equity shares of Ra 1 each of Zee Learn for every 10 fully paid equity shares of Rs 10 of Tree House.

The market continues to be sluggish as the Nifty is below 8650. The 50-share index is down 3.95 points at 8638.60. The Sensex is up 18.93 points or 0.07% at 28083.54. About 1121 shares have advanced, 710 shares declined, and 97 shares are unchanged.

Hero MotoCorp, Bajaj Auto, Axis Bank, Coal India and Cipla are gainers while TCS, Infosys, Asian Paints, ICICI Bank and GAIL are losers in the Sensex. Metal index is up.

Gold was little changed as hawkish comments from US Federal Reserve officials raised bets on a rate hike this year and traders await minutes of the last Fed policy meeting for more clues. The Fed is raising expectations for an interest rate rise this year, even as early as next month, after two policymakers on Tuesday said the economic stars now appear to be aligning despite weak US economic growth in the first half of 2016.

New York Fed President William Dudley said a rate hike in September was possible, while Atlanta Fed President Dennis Lockhart said the US economy is likely strong enough for at least one rate increase before the end of 2016, with two a possibility.

9:55 am Scouting for new partners: Low-cost carrier AirAsia Group's chief Tony Fernandes said he would love to have joint venture in China, to take advantage of the booming travel industry in the world's second-largest economy. "I believe there is a strong chance of that happening so we have to wait and see," said Tony Fernandes, group chief executive officer of AirAsia Group, in a CNBC exclusive. While several interested parties have approached the Malaysia-based airline, Fernandes said it's still early days in the hunt for the right partner.

9:45 am Farm credit: Reserve Bank Deputy Governor SS Mundra called for increasing the credit absorption capacity of the farm sector to make agri-lending more sustainable.

"In agriculture, there is a year-by-year increase in targets which are accepted and are being achieved. But I'd believe that there is a limit to it," he said at the annual Fibac conference here.

"Unless there is an improvement in the credit absorption capacity of the farm sector, it (agri-lending) would be risky," he warned.

It can be noted that every year, the government sets a direct agri-lending target for banks. The Narendra Modi administration has set a target to double farm income by 2022.

9:30 am FII view: Herald Van Der Linde of HSBC says he continues to see no significant re-rating of Asian equities in the immediate future and expects low earnings growth of 1.9 percent to be the key driver for markets. However, he continues to be overweight on Indian equities as monetary transmission mechanism is underway and passage of GST bill is a big step towards improving tax efficiency in India.

The market has opened in green with the Sensex down 37.51 points or 0.1 percent at 28027.10. The Nifty is down 14.10 points or 0.2 percent at 8628.45. About 419 shares have advanced, 309 shares declined, and 33 shares are unchanged. Investors will keenly watch out minutes of the Fed's July policy meeting, scheduled for release tonight, for clues on the US central bank's rate plans after recent blowout jobs data.

Hero MotoCorp, Axis Bank, Tata Motors, Bajaj Auto and Tata Steel are gainers while TCS, Sun Pharma, Lupin, Cipla and SBI are losers in the Sensex.

Currency market is shut due to Parsi New Year.

Asian markets opened mixed, as the sentiment hit from a lower finish in the US stock market offset the positive impact of a rise in oil prices. Australia's benchmark ASX 200 was down 0.37 percent in early trade, with the heavily-weighted financials sub-index down 0.69 percent. In New Zealand, the NZX 50 was higher by 0.63 percent in mid-morning trade.

Japanese shares traded higher, with the Nikkei 225 index up 0.65 percent and the Topix advancing 0.57 percent. Across the Korean Strait, the Kospi fell 0.29 percent.

US stocks eased from record highs on Tuesday after comments from Federal Reserve officials fueled speculation of an interest rate hike this year.

New York Federal Reserve Bank President William Dudley said a rate hike in September was possible, while Atlanta Fed President Dennis Lockhart said the US economy is likely strong enough for at least one rate increase before the end of 2016, with two a possibility.

In the currency space, the dollar traded off lows after two regional fed chiefs indicated rates could be boosted at least once this year. Meanwhile the dollar-yen traded around 100 after slipping below 100 yesterday for only the second time this year.

Crude prices pared gains after preliminary data from the American Petroleum Institute showed a surprise build in US gasoline stocks. Gold prices continued to trade around USD 1340 an ounce.