Nifty fails to hold 7500, Sensex ends flat amid weak global cues

08 Mar 2016

The market started off truncated week on a flat note. The Nifty failed to hold 7500-mark amid choppy trade and weak global cues. Index heavyweights Reliance Industries, ITC and HDFC supported equity benchmarks while banks, infra and select technology stocks saw selling pressure.

It was a consolidation day after more than 6 percent rally last week. The 30-share BSE Sensex rose 12.75 points to 24659.23 while the Nifty fell 0.05 points to 7485.30. The broader markets too ended flat.

Nilesh Shah of Kotak Mutual AMC says the Nifty is unlikely to revisit lows of 6800 unless catastrophic events take place. He advised clients to be marginally overweight on equities post Budget.

Global markets saw consolidation and profit taking after last week's rally. European markets like CAC and DAX fell 1.6 percent each followed by FTSE with 1 percent loss while in Asia, Hang Seng and Nikkei declined more than 0.7 percent each. However, Shanghai bucked the trend, closing in green despite exports fell 25.4 percent in February, the biggest fall since 2009.

Oil prices edged lower today after Kuwait said it would only agree to an output freeze if all major producers take part and Goldman Sachs analysts poured cold water over the prospects for a sustained rally. Brent crude futures fell 0.6 percent to USD 40.6 a barrel.

Meanwhile, Finance Minister Arun Jaitley says the government has withdrawn (Budget) proposal to tax Employee Provident Fund but retained tax proposal for NPS.

Commodities stocks saw buying interest today. In oil space, Reliance Industries was the leading contributor to Sensex's gains, up 2 percent and GAIL gained 2.5 percent. Sugar stocks like Balrampur Chini, Dwarikesh Sugar & Dalmia Sugar hit 52-week high, rising 7-17 percent.

Metals stocks like Tata Steel, Vedanta and Hindalco rose 1-5 percent on surge in iron ore prices.

Lupin shares climbed 2 percent as Nomura upgraded the stock to buy from neutral, saying generic Fortamet and Glumetza (diabetes medicines) offer strong near-term earnings support to the company. The brokerage also increased target price to Rs 2,110 apiece from Rs 2,080 earlier, implying 19 percent potential upside.

Natco Pharma was up 1.7 percent as Kotak Securities has initiated buy on the stock with a target of Rs 563 (implying a 17 percent upside), citing strong hepatisis C portfolio and US revenue.

Maruti Suzuki lost 3 percent. The company launched compact SUV Vitara Brezza today, the first launch of 2016.

SBI was down 2.5 percent. Debt Recovery Tribunal has passed orders on SBI's plea, saying Diageo cannot disburse money to Vijay Mallya till March 28 and Mallya can't withdraw USD 75 million settlement received from Diageo till case disposed off.

Among others, ITC and HDFC gained more than 1.5 percent while ICICI Bank, HUL, Axis Bank, Cipla and Hero Motocorp fell 1-2.5 percent.

3:30 pm Market close: The Sensex ended up 12.75 points at 24659.23, and the Nifty slipped 0.05 points at 7485.30. About 1322 shares have advanced, 1325 shares declined, and 148 shares are unchanged.

Hindalco, Lupin, GAIL, Reliance and HDFC were top gainers in the Sensex while Maruti, SBI, HUL, ICICI Bank and Axis Bank were losers.

3:10 pm Hot IPO market: To tap the upbeat investor sentiments, as many as 21 small and medium enterprises (SMEs) have filed draft papers this year to raise funds totalling Rs 180 crore through their initial public offerings. The shares will be listed on the SME platforms of the BSE and National Stock Exchange (NSE). Since the beginning of this year, 21 companies have filed draft documents to collectively raise over Rs 180 crore through IPOs, according to an analysis. Of these, 13 firms have filed papers to launch IPOs on BSE's SME platform, while the remaining eight plan to list on NSE Emerge.

2:59 pm Market recovers: Equity benchmarks recovered from day's low, aided by Reliance Industries, ITC and HDFC.

The Sensex rose 7.84 points to 24654.32 while the Nifty fell 3.55 points to 7481.80.

The market breadth remained negative as about 1352 shares declined against 1220 advancing shares on the BSE.

2:45 pm Environment clearance: As many as 943 projects entailing investments worth Rs 6.72 lakh crore received environmental clearance in the last 20 months, government said today.

Environment Minister Prakash Javadekar informed the Lok Sabha the government has reduced the time taken for giving environmental clearance to around 192 days from 600 days and efforts would be made to reduce it further.

"During the last 20 months, the Ministry has accorded environmental clearance to 943 projects involving an approximate investment of Rs 6,72,422.60 crore," Javadekar said during Question Hour.

According to him, the average time taken for giving environmental clearances has come down to around 192 days after the launch of the online system for applications.

2:25 pm Dalmia Bharat gets CCI nod: Dalmia Bharat has got fair trade regulator CCI's approval to acquire 15 percent stake in its subsidiary Dalmia Cement Bharat from private equity giant KKR for over Rs 1,218 crore in a cash and stock deal.

Post the deal, Dalmia Cement Bharat (DCBL) will become a wholly-owned subsidiary of Dalmia Bharat (DBL). Competition Commission of India (CCI) has cleared the proposed deal, as per information on the regulator's website.

The deal has earned KKR Mauritius Cement Investment a return of 2.4 times on its investment of Rs 500 crore that it made in September 2010.

2:00 pm Market Check
Equity benchmarks wiped out gains in afternoon trade, especially after weak opening of European markets. Banks, technology and infra stocks dragged market.

The 30-share BSE Sensex fell 107.73 points to 24538.75 and the Nifty declined 34.20 points to 7451.15. The BSE Midcap also declined half a percent.

The market breadth turned negative as about 1349 share declined against 1164 advancing shares on Bombay Stock Exchange.

Infosys, ICICI Bank, SBI, HUL, TCS, Maruti Suzuki, L&T, Axis Bank, Dr Reddy's Labs and Hero Motocorp were down 1-3 percent.

European equities were trading lower after a recent rally petered out in Asian markets and China trade data hit European miners hard. France's CAC, Germany's DAX and Britain's FTSE lost a percent each.

1:45 pm On the run? The Supreme Court today agreed to hear tomorrow a plea filed by a consortium of 17 PSU banks seeking a direction that industrialist Vijay Mallya be restrained from leaving India. "List it for hearing tomorrow," a bench comprising Chief Justice T S Thakur and Justice U U Lalit said, when Attorney General Mukul Rohatgi, appearing for PSU banks, mentioned the matter for urgent hearing. Rohatgi said that the plea has been moved by 17 banks, including State Bank of India , against Mallya whose various firms have taken loan from them. He also said that the dues run into thousands of crore.

1:30 pm Buzzing: Metal stocks jumped with the index up around 2.6 percent, tracking surge in iron ore prices. The Metal index has gained 10.20 percent in a week. Shares of NMDC were up 11 percent, Tata Steel gained 3 percent while Hindalco was up 6 percent intraday. Iron ore prices climbed 20 percent to an eight-month high on expectations that Chinese steel mills are planning a short-term output boost. Iron ore has risen more than 22 percent this year, making it the best performing commodity so far in 2016, in a rally fuelled by stronger Chinese steel prices as market participants looked to brisk seasonal demand from March. The rally followed losses of around 70 percent in the past three years as iron ore was hit by a global glut and weaker Chinese steel demand.

The market is flat as the Sensex is down 29.60 points 24616.88. The Nifty is down 10.30 points at 7475.05. About 1314 shares have advanced, 1152 shares declined, and 142 shares are unchanged.

Hindalco, GAIL, Lupin, Tata Steel and Adani Ports are gainers while Maruti, HUL, SBI, Infosys and ICICI Bank are losers in the Sensex.

Gold prices spurted by Rs 279 to Rs 29,871 per 10 gram in futures trade as speculators widened their bets taking positive cues from the global market.

Analysts said fresh positions created by participants following a better trend in global market as commodities extended their recovery after China said it will boost efforts to right the economy and the US dollar weakened, supported the upside in gold futures.

12:58 pm Market Update: Benchmark indices were little changed over the last half an hour of trade. The Sensex rose 26.34 points to 24672.82 and the Nifty advanced 8.60 points to 7493.95.

Hindalco (5.2 percent), Tata Steel (2.4 percent), Adani Ports (2.3 percent) and GAIL (2.0 percent) were the top gainers in Nifty. Among the losers were HDFC Bank (-0.7 percent), Dr Reddys Labs (-0.7 percent), TCS (-0.6 percent) and Hero Motocorp (-0.6 percent).

In sectoral performance as reflected by the respective indices, metals (2.6 percent), oil & gas (2.1 percent), healthcare (0.6 percent) and FMCG (0.5 percent) gained, while IT (-0.8 percent) were under pressure.

The rupee was quoting at 67.36 to the dollar, down 27 paise over its previous close.

12:45 pm Nomura on Lupin: Lupin shares climbed nearly 3 percent intraday. Nomura upgraded the stock to buy from neutral, saying generic Fortamet and Glumetza (diabetes medicines) offer strong near-term earnings support to the company.

The brokerage also increased target price to Rs 2,110 apiece from Rs 2,080 earlier, implying 19 percent potential upside.

According to its research note, market opportunity for Lupin in Fortamet and Glumetza (both Metformin XR product) unpredictably increased significantly, cushioning impact of delays in approvals and launches.

The company failed to receive timely approvals and launch certain high value products in the US, in the recent past.

12:25 pm Inox Wind bags order: Energy solutions provider Inox Wind has bagged two projects of 26 mega watt (mw) each from Indian Oil Corporation (IOC) and Gujarat Industries Power.

The project awarded by electrical power generation firm Gujarat Industries Power will be set up in Rojmal, Gujarat.

The company added that it will supply and install 26 units of wind turbine generators for both the orders and will be responsible for the entire project life cycle, including long-term operations and maintenance services.

12:00 pm Market Check: The market continued to be in positive terrain amid volatility. Oil, metals and infra stocks saw buying interest while banks stocks caught in bear grip.

The Sensex rose 25.60 points to 24672.08 and the Nifty advanced 8.25 points to 7493.60. The broader markets outperform benchmarks. The BSE Midcap and Smallcap indices gained 0.3 percent and 0.6 percent, respectively. About 1385 shares advanced against 926 declining shares on the BSE.

Cairn India topped buying list on Nifty, up more than 7 percent following rally in crude oil prices. Brent crude climbed over USD 40 a barrel.

Metals stocks remained strong with Vedanta and Hindalco gaining nearly 5 percent followed by Tata Steel with 2 percent upside.

Finance Minister Arun Jaitley says the government has withdrawn proposal to tax Employee Provident Fund but retained tax proposal for NPS.

11:30 am EPF rollback? All eyes are on Finance Minister Arun Jaitley who is expected to make an important announcement regarding the proposed tax on 60 percent of Employees Provident Fund withdrawal. Jaitley may announce a relief after Prime Minister Narendra Modi's intervention. The Finance Minister is expected to speak on EPF tax proposal in the Lok Sabha after 12 noon. Modi had reportedly asked Jaitley to reconsider the Budgetary proposal under which a part of the EPF withdrawal will be taxed, according to highly placed sources. Sources said that an official level meeting was held in PMO on the EPF tax issue on March 3, 2016, adding that the Finance Minister is likely to make an announcement the exemptions on the floor of House when he replies to Budget.

The market is still on an uptrend with a good support from auto, healthcare, metals and Oil & gas. The Sensex is up 84.97 points or 0.3 percent at 24731.45 and the Nifty is up 23.00 points or 0.3 percent at 7508.35. About 1369 shares have advanced, 766 shares declined, and 125 shares are unchanged.

Hindalco, GAIL, Tata Motors, Adani Ports and Lupin are top gainers while SBI, HUL, ICICI Bank, Maruti and Infosys are losers in the Sensex.

Oil prices dipped in Asia today but Brent crude stayed above USD 40 a barrel, as traders took profits after solid gains over the past three weeks.

Prices have strengthened following talks of a production freeze, with a producers meeting mooted on March 20 in a bid to ease a global supply glut that has depressed the market.

Sentiment has also been boosted by strong US jobs growth data and a weaker greenback which makes dollar-priced oil cheaper, perking up demand.

10:58 am Market Update: Equity benchmarks remained higher. The BSE Sensex rose 81.26 points to 24727.74 and the Nifty advanced 23 points to 7508.35.

The market breadth continued to be positive as about 1362 shares advanced against 768 declining shares on the BSE.

10:40 am Buzzing: Shares of Ajanta Pharma climbed nearly 4 percent intraday on approval from the US health regulator for anti-migraine drug.

"Ajanta has received final approval of Almotriptan Malate tablets (6.25 mg and 12.5 mg) from US Food and Drug Administration," says the company in its filing.

Ajanta Pharma USA Inc, a wholly owned subsidiary of the company, is scheduled to launch Almotriptan tablets in US shortly. Almotriptan is a generic version of Axert and is used for treatment of acute migraine pain relief.

As of now, FDA has granted Ajanta Pharma eight ANDA (abbreviated new drug application) final approvals and two tentative approvals while additional 16 ANDAs are under review with FDA, says the company.

10:20 am Oil above $40/bbl: Oil prices dipped in Asia today but Brent crude stayed above USD 40 a barrel, as traders took profits after solid gains over the past three weeks.

Prices have strengthened following talks of a production freeze, with a producers meeting mooted on March 20 in a bid to ease a global supply glut that has depressed the market.

Sentiment has also been boosted by strong US jobs growth data and a weaker greenback which makes dollar-priced oil cheaper, perking up demand.

US benchmark West Texas Intermediate (WTI) for delivery in April slid 38 cents to USD 37.52 and Brent crude for May fell 53 cents to USD 40.31 a barrel.

Brent closed at USD 40.84 a barrel in London yesterday, its highest since early December.

10:00 am Market Check: The market gained further on support from index heavyweights Reliance Industries, HDFC and ITC. The broader markets also traded in line with benchmarks; the BSE Midcap gained 0.5 percent and Smallcap climbed nearly 1 percent.

The 30-share BSE Sensex rose 130.26 points to 24776.74 and the 50-share NSE Nifty surged 37.15 points to 7522.50. More than two shares advanced for every share declining on the Bombay Stock Exchange.

ITC, Tata Motors, Lupin, ONGC, GAIL and BHEL topped buying list on Sensex, up more than 2 percent followed by HDFC, L&T, Sun Pharma, Axis Bank and M&M with more than 1 percent upside.

Infosys, TCS, ICICI Bank, HUL and SBI declined around a percent.

9:54 am Mallya's woes: After being declared as wilful defaulter by State Bank of India and Punjab National Bank, one more state-run lender United Bank of India said it is continuing its efforts to declare liquor barron Vijay Mallya as wilful defaulter. United Bank of India (UBI) was the first lender to make an attempt to declare Mallya as wilful defaulter in 2014 but it was dismissed by the Calcutta High Court. "Early last year, we went to Calcutta division bench. Most of the arguments have been heard. We were expecting the final outcome before March," United Bank of India Managing Director and CEO P Srinivas told PTI.

9:45 am Pumping funds: Apollo Tyres will invest up to USD 600 million (about Rs 4,000 crore) next fiscal to enhance capacity at its plants in India and abroad.

The company, which announced its foray into the two-wheeler market, will start rolling out tyres from its upcoming plant in Hungary by January 2017.

"We plan to spend around USD 500-600 million as part of our capital expenditure in the next fiscal on our two plants in Chennai and Hungary," Apollo Tyres Vice-Chairman and Managing Director Neeraj Kanwar told PTI.

He further said the company is doubling the capacity of its Chennai plant to 12,000 truck and bus radials (TBR) a day from 6,000 earlier.

9:30 am Commodities view: Metals have rallied in the last couple of days with steel prices rising 15 percent and iron ore prices improving 46 percent this year.

Daniel Hynes of ANZ Research says that investors have become less bearish on metals. ''I feel that commodity prices have bottomed out,'' he says.

Speaking to CNBC-TV18, Hynes says that the important question is whether the rally in metals is sustainable or not. The rise in steel prices is speculative, he says, adding that there has been no real improvement in demand. Fundamentals have not changed, Hynes adds.

The market has opened flat on Tuesday but soon gained strenght. The Nifty hit 7500, up 16.55 points and the Sensex is up 50.62 points or 0.2 percent at 24697.10.

Hindalco, ONGC, Coal India, Infosys and HDFC are top gainers and SBI, ICICI Bank, TCS, Lupin and Adani Ports were losers.

The Indian rupee opened lower by 13 paise at 67.21 per dollar versus 67.08 Friday. The dollar fell against a basket of currencies as big gains in oil prices rekindled demand for the euro and commodity-sensitive currencies.

Ashutosh Raina of HDFC Bank said, "The USD-INR pair continues to gain from recent lows on the back of improvement in risk sentiment, with oil and commodity prices moving higher, coupled with overall dollar weakness."

Asian markets were trading mixed following a mild finish from US equities overnight. Revised government data showed the economy shrank at an annualized 1.1 percent in the final quarter of 2015. China's February trade figures are also due.

Foreign currency reserves of China fell to USD 3.2 trillion at the end of February, dropping from USD 3.23 trillion the previous month, marking the fourth straight month of declines, although the pace of outflows slowed substantially.

US stocks closed mixed, steadying after their first three-week rally of the year so far, as gains in energy stocks offset declines in technology. The Dow Jones posted its first five-straight days of gains since October.