Sensex ends up 330 points, Nifty gains 1%; M&M surges 4%

22 Dec 2014

03:35 pm Market close:
The market ended a volatile trading session with some massive gains. The Sensex ended at 329.95 points or 1.2 percent at 27701.79, and the Nifty was up 98.80 points or 1.2 percent at 8324.00. About 1562 shares have advanced, 1348 shares declined, and 118 shares were unchanged.

M&M, Coal India, BHEL and HDFC twins were up 3-4 percent each. Among the losers were Hindalco, L&T, Infosys and Tata Steel.

03:05 pm Global market check:
World share markets extended their 'Santa rally' into a fourth day, as a recovery in beaten-down oil prices and the rouble and more calls for quantitative easing from the ECB helped lift sentiment.

There were also hopes that Greece could avoid destabilising snap elections after Greece's Prime Minister Antonis Samaras made a surprise offer to bring pro-European independents into the government if they backed his choice for new president.

Asian markets had set the tone with gains of 1 percent as they followed on from Wall Street's strong finish to last week and European bourses were just as buoyant.

02:50pm Banks gains strength
The strength in banking & financials, oil & gas, FMCG and auto stocks helped the Sensex rally 268.34 points or 0.98 percent to 27640.18 and the Nifty jump 82.70 points or 1.01 percent to 8307.90.

02:40pm Market Update
The market extended rally with the 30-share BSE Sensex rising 210.33 points to 27582.17 and the Nifty soaring 59.10 points to 8284.30.

About 1444 shares have advanced, 1345 shares declined, and 130 shares are unchanged.

02:30pm Jewellery and Tyre stocks
Jewellery stocks like TBZ, Titan Company, Gitanjali Gems, Shree Ganesh Jewellery, PC Jeweller and Thangamayil Jewellery gained 1-8 percent while tyre stocks like JK Tyre and Ceat fell 4-6 percent.

02:20pm Interview
AK Gupta, CMD, Shipping Corporation of India (SCI) says the fall in Baltic Dry Index (BDI) over the past 30 days impacts both the company and the industry adversely.

The Baltic Dry Index, which tracks global freight rates for ships carrying dry-bulk commodities such as coal, iron ore and grains, has seen a fall of 32 percent. It fell from 1123 to 803 since start of December. The index basically is driven by Capesize vessels, which were unemployed for long a time due to excess supply of these vessels.

Capesize vessels are typically above 150,000 long tonne deadweight (DWT) transporting coal, ore, and other commodity raw materials.

The shipping industry on the whole is also not seeing much stability going forward and this fall in BDI has added to the woes, says Gupta.

However, there are some signs of firming up seen on the tanker side of the business because of fall in crude prices and with winter setting in.

02:00pm Market Check
Equity benchmarks gained strength in afternoon trade supported by FMCG, auto and HDFC twins. The Sensex jumped 125.44 points to 27497.28 and the Nifty rallied 36.55 points to 8261.75.

About 1384 shares have advanced, 1327 shares declined, and 128 shares are unchanged on the Bombay Stock Exchange.

Sanjeev Prasad of Kotak Institutional Equities says Indian equities are in a sweet spot. He expects fresh highs in the market before the Budget and advises buying interest rate sensitives and consumer durable stocks.

State-run NTPC, Coal India, GAIL and BHEL topped the buying list on Sensex, up 2.5-3 percent followed by M&M with 2 percent upside. ITC, HDFC, HDFC Bank, ONGC, HUL and Bharti Airtel climbed 1-1.5 percent while TCS, Infosys, ICICI Bank, L&T, Reliance Industries, Hindalco and Tata Steel declined 0.3-1 percent.

Meanwhile, the rupee traded flat against the dollar at 63.24 versus a close of 63.29 on Friday. Traders say month-end and quarter-end dollar demand will weight on rupee later in the session.

In global markets, European markets like CAC, DAX and FTSE gained 0.5-1 percent while Asian stocks closed mostly higher taking their cue from the Friday's US market momentum and stability in crude prices.

1:45 pm Buzzing: Shares of BHEL gained 3 percent intraday on bagging a contract for thermal power project from EUAS in Turkey.

"BHEL has bagged a contract for rehabilitation of 3 units of electrostatic precipitators for the 430 MW Tuncbilek Thermal Power Project in Turkey on EPC basis," said the state-run power equipment maker in its filing to the exchange.

The order, which is valued at euro 16.96 million, envisages dismantling, supply, civil works and erection & commissioning of the electrostatic precipitators.

EUAS is electricity generation company owned by the Turkish government. "Turkey has embarked on a renovation and modernisation programme of its old thermal power projects and the present contract is aimed at reducing the emission levels drastically," said the company.

1:30 pm Outlook: Ahead of the Budget, Dipan Mehta, Member of BSE & NSE advises investors to shy away from downstream and upstream companies while buy into interest rate sensitive stocks.

Seeing 25-30 percent upside potential in private sector banks and NBFCs, he remains overweight on them. Furthermore, he is positive on FMCG and autos while being underweight on the entire PSU pack due to lack of clarity on some issues.

In an interview to CNBC-TV18, he shares concerns over a further sell-off in crude price hitting market sentiment. Onto specifics, he feels JSPL may be underpriced going by fundamentals. Investors can buy into the stock at current market price with 2-3 years horizon.

The market is range bound with the Sensex is up 63.67 points at 27435.51. The Nifty is up 16.70 points at 8241.90. About 1321 shares have advanced, 1340 shares declined, and 126 shares are unchanged.

Coal India, NTPC, GAIL, BHEL and M&M are top gainers in the Sensex. Among the losers are Hindalco, Tata Steel, TCS, ICICI Bank and Infosys.

Shares of tyre companies like Apollo Tyres, Ceat and JK Tyre are under pressure as they have agreed to procure rubber from the domestic market at 25 percent higher price over international price to aid the fund-staved sector in Kerala. Analyst say margin expansion for tyre companies will be capped.

Foreign investors sold nearly USD 1 billion worth of shares over nine consecutive sessions of selling, amid a brewing financial crisis in Russia and a crude oil slump, regulatory data show. They still remain net buyers of Indian equities worth USD 16.5 billion in 2014 so far.

Volatility may rise due to expiry of equity derivatives on Wednesday while progress on key reforms such as the opening up of insurance and coal sectors and tabling of a bill on nationwide sales tax in parliament's winter session that ends.

12:55pm Market Update
The Sensex rose 55.84 points to 27427.68 and the Nifty advanced 16.50 points to 8241.70. About 1296 shares have advanced, 1300 shares declined, and 116 shares are unchanged.

12:45pm Interview
Narendra Kothari, CMD, NMDC believes domestic prices are a function of domestic demand and not international prices. Moreover, domestic demand is still intact, he says in an interview to CNBC-TV18.

The state-controlled mineral producing company is set to export 2 mt out of total 30 mt in FY15. Kothari is confident of making up for production loss on account of cyclone Hudhud in Q4.

Going ahead, he does not expect an additional price cut.

12:40pm BHEL bags order
BHEL has bagged a contract for rehabilitation of 3 units of electrostatic precipitators for the 430 MW Tuncbilek Thermal Power Project in Turkey on EPC basis, said the state-run power equipment maker in its filing to the exchange.

The order, which is valued at euro 16.96 million, envisages dismantling, supply, civil works and erection & commissioning of the electrostatic precipitators.

EUAS is electricity generation company owned by the Turkish government. "Turkey has embarked on a renovation and modernisation programme of its old thermal power projects and the present contract is aimed at reducing the emission levels drastically," said the company.

12:20pm Jindal Stainless in News
Jindal Stainless said a meeting of the board of directors of the company will be held on December 29 to consider and approve a scheme on "asset monetization and business reorganization plan" (AMP) of the company.

As per company's insider trading policy for Prevention of Insider Trading, the trading window for dealing in securities of the company will remain closed for all the directors and designated employees of the company from December 23, 2014 till December 30, 2014 (both days inclusive).

12:00pm Market Check
Equity benchmarks gained for third consecutive session today while the broader markets outperformed with the BSE Midcap and Smallcap indices rising more than half a percent. FMCG, power, auto and HDFC twins supported the market while technology and metals stocks were under pressure.

The Sensex rose 52.36 points to 27424.20 and the Nifty climbed 16.35 points to 8241.55. Advancing shares outnumbered declining ones by a ratio of 1286 to 1145 on the Bombay Stock Exchange.

Jindal Steel and Power gained more than 4.5 percent after the company announced that it's arm, Jindal Power alloted NCDs worth Rs 500 to Kotak Mahindra Bank. JSPL already raised Rs 1,000 crore via the non convertible debentures alloted to Kotak Mahindra Bank last week.

Tyre stocks such as JK Tyre and Apollo Tyres fell 1-5 percent. Media reports indicated that major tyre companies have agreed to procure natural rubber from the domestic market at a 25 percent rate higher than the international price.

Videocon Industries gained more than 5 percent as the company will issue 1.57 crore GDRs worth USD 45.22 million to LLIC Sarl on a private placement basis.

Crompton Greaves, Infosys, BF Utilities, SBI, NCC, ITC, ICICI Bank and Coal India were most active shares on exchanges.

Globally, Asian markets traded mostly higher taking positive cues from US markets on last Friday. Sentiment also improved on a bounce back in oil prices. Brent crude oil prices traded above USD 62 a barrel.

11:50 am Interview: Shares of Videocon surged 12 percent in early trade after it announced its fund raising plans via global depository receipts (GDR). Speaking about the GDR, which amounts to USD 45.216 million to be issued to LLIC, Venugopal Dhoot, chairman and managing director, Videocon, says the investment firm has been very bullish on the company and has hence been looking to shore up stake even further.

LLIC, a large US-based global investment company, will be increasing its stake in Videocon from Rs 300 crore to Rs 550 crore.

''We have given them stocks at a premium of Rs 20-25 than the current market price through the Global Depository Receipts (GDR) route as it is easy for investments,'' adds Dhoot.

Videocon Industries Ltd has informed BSE, "the company has decided to issue 15,700,000 GDR amounting to USD 45.216 million representing 15,700,000 equity shares at a price of USD 2.88 per GDR, equivalent to approximately Rs 181.61 per equity share, to LLIC S.a.r.l., on a private placement basis."

11:30 am Buzzing: Shares of Bajaj Auto rose 2 percent intraday after it bagged an order for 1.25 lakh units of Discover-125M motorcycles from Sri Lankan government.

However, analysts are not very enthused about the stock. Macquarie maintains underperform rating with a 12-month target price of Rs 1,850 per share on worries that headwinds due to rising competition in motorcycles.

Morgan Stanley also maintains underweight as it feels the auto major's current export run-rate will slow down and gaining share in domestic market will be tough for it. The brokerage also feels that valuations are pricing in the best-case scenario.

Goldman Sachs reiterates sell rating. It cautions that weakness in Discover portfolio may give opportunity to TVS and exports also may be under pressure.

The market is holding firm with support by FMCG and Auto. The Sensex is up 71.19 points at 27443.03 and the Nifty is up 21.95 points at 8247.15. About 1241 shares have advanced, 953 shares declined, and 100 shares are unchanged.

GAIL, NTPC, BHEL, Coal India and HUL are top gainers in the Sensex. Among the losers are Infosys, Hindalco, Reliance, ICICI Bank and TCS.

Japanese stocks briefly hit a two-week high, led by oil-related shares on rebounding crude prices and as Showa Shell Sekiyu surged over 25 percent on a media report of an impending takeover bid.

Oil-related shares led the rally, with the oil and coal products companies subindex jumping 7.7 percent to become the best performing sector on the main board. US crude futures rose to near USD 57.50 a barrel in early Asian trades on Monday, extending a rise helped by profit-taking on short positions.

10:55am Market Update
The Sensex rose 71.26 points to 27443.10 and the Nifty advanced 21.40 points to 8246.60. About 1241 shares have advanced, 951 shares declined, and 94 shares are unchanged.

10:40am 4G rollout in 2020?
Telecom industry body COAI has requested the Department of Telecom to extend deadline for roll out of 4G services to 2020 citing various hurdles mainly delay in development of technology and regulatory procedures.

"DoT is requested to review and relax the roll out obligations and extend the timelines for meeting the roll out by additional 5 years," COAI Director General Rajan S Mathews said in a letter to DoT.

The body has cited difficulties in rolling out the LTE-TDD (a 4G technology) as among reasons for delay in roll out of 4G services.

The broadband wireless access spectrum, that can be used for 4G services, was allocated through auction in 2010. Aircel, Bharti Airtel , Qualcomm (acquired by Bharti), Tikona, Infotel (now Reliance Jio Infocomm) and Augere emerged as successful bidders of BWA spectrum, reports PTI.

10:20am FII View
Andrew Garthwaite, Credit Suisse says lower oil price would improve India's GDP by 1.5 percent, it would also impact monetary policy with RBI likely to begin cutting interest rates in early 2015.

"These positives only serve to further underpin our positive stance on India, which benefits from a cheap currency, the most comprehensive set of reforms, strong demographics and limited exposure to slowdown in China. The Indian market is not cheap, but historically, an acceleration in GDP growth tends to correlate with a re-rating of the equity market," he adds.

10:00am Market Check
Equity benchmarks are consolidating today ahead of expiry of the December derivative contracts, which scheduled to be on Thursday. The Sensex rose 66.64 points to 27438.48 and the Nifty advanced 19.80 points to 8245.

The broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising 0.7 percent and 0.5 percent, respectively. Nearly two shares advanced for every share declining on the Bombay Stock Exchange.

Given that Indian equities are in a sweet spot, market should hold steady at current levels, says Sandeep Bhatia, Executive Director and Head of Sales at Kotak Institutional Equities.

Going ahead, the market may witness fresh highs before the Budget, he says in an interview to CNBC-TV18.

Shares of NTPC and Gail topped the buying list, up 2 percent each followed by ITC, ONGC, Maruti Suzuki, Mahindra & Mahindra, HUL, Hero Motocorp, Bharti Airtel, Coal India, Sesa Sterlite and BHEL with 1-1.7 percent gain.
However, Infosys, ICICI Bank, Reliance Industries, TCS, L&T, Hindalco Industries and Dr Reddy's Labs declined 0.4-1 percent.

9:50 am View on bonds: Over the last three years, equities have been very less volatile, says Steve Brice of Standard Chartered Bank. Now, with volatility coming back into the market and returns going down, investors can look elsewhere - be it within bond markets or some local currency markets, he adds. "Chinese bonds have been an area we have been particularly focused on. We also believe Indian rupee bonds offer very high yields, around 8 percent decline in interest rate outlook there as well. We also feel Indian rupee is likely to be quite stable," he said.
 
According to him, India has been fairly resilient. With current account deficit coming down - close to around 1 percent of GDP-and oil prices falling, it has led to a re-rating of the stock market in India. He believes that lower oil prices are positive for the global economy, but more so for India. Brice sees a strong dollar in 2015, which will have an impact on many of the currencies in the region. He expects the rupee to be more sheltered now.

9:30 am Upgrade: Kotak has upgraded Bharti Airtel to buy rating and sees a 25 percent upside from current levels. It has set a target price of Rs 430 per share on the back of recent sharp correction. The brokerage believes that though there are risks, but those are amply priced in. Shares of the telecom stock jumped 1 percent intraday on Monday.

Kotak adds that the market also seems perturbed about the oil-correction-led depreciation in select African currencies and also the impact of the same on the macro-economic situation of these economies.

The market has opened on a higher note. The Sensex is up 99.61 points at 27471.45, and the Nifty is up 29.80 points at 8255.00. About 437 shares have advanced, 166 shares declined, and 31 shares are unchanged.

Sesa Sterlite and Bajaj Auto are up 2 percent each. HDFC Bank, Tata Power and SBI are other gainers in the Sensex. Hindalco, ITC, Cipla and HUL are among the laggards.

The Indian rupee opened flat at 63.30 per dollar against 63.29 Friday. The euro is at fresh two-year lows in a subdued start to a holiday-shortened week, extending a multi-month trend of weakness against the dollar.

Pramit Brahmbhatt of Veracity said, "Reduction in FII inflows coupled with profit booking in local equities may put pressure on the rupee. However, gains in Asian equities and some exporter selling may limit losses. Expect the rupee to be ranged between 62.80-63.50/dollar."

Global cues, meanwhile, are positive with the US market ending higher with the S&P 500 rallying its second best week in nearly two years. European shares closed mixed on Friday, with Italian banking stocks and the healthcare sector weighing on wider benchmarks.

Asian stocks are in the green over a bounce in oil markets and over gains seen on the Wall Street. Brent Crude bounced higher as selling pressure from a six-month price rout eased helped by fresh buying in the US Crude before the expiry of the front-month contract. Gold was soft below USD 1200 dollars an ounce, as the dollar is firm and investor appetite for risk increases on expectations of rising US interest rates.