Sensex, Nifty end down; Strides Arcolab up 6%, IT gains

29 Sep 2014

03:30 pm Market closing: The market ended volatile session on a flat note. The Sensex is down 29.21 points at 26597.11 and the Nifty down 9.95 points at 7958.90. About 1857 shares have advanced, 1088 shares declined and 100 shares were unchanged.

IT and pharma stocks were on buyers radar while banks, metals and FMCG were down. TCS, Sun Pharma, GAIL, Infosys and Hindalco were top gainers in the Sensex. Among the losers were Tata Steel, Sesa Sterlite, Coal India, ICICI Bank and ITC.

03:15 pm Currency movements: The dollar hit its highest in almost two years against the euro with German inflation data expected to keep pressure on the ECB to ease monetary policy further, while unrest in Hong Kong hurt Asian-exposed European shares.

The dollar was broadly stronger, hitting a four-year high against a basket of currencies, a six-year peak against the yen and a 13-month high against the New Zealand dollar. Reserve Bank of New Zealand data showed the central bank intervened last month to speed its currency's descent.

Data on Friday showing higher US growth in the second quarter fuelled speculation that a Federal Reserve interest rate hike may come sooner than expected, in striking contrast with the outlook for the European Central Bank.

3:00 pm Buzzing: Shares of  Strides Arcolab jumped 9 percent after board approved its merger with Shasun Pharmaceuticals . Shares of Shasun Pharma were up 5 percent intraday.

''Each equity shareholder of Shasun will be entitled to receive five equity shares of Strides in lieu of 16 equity shares held in Shasun. Based on the exchange ratio, Shasun shareholders will own 26 percent  of the combined entity.  The current promoters of Shasun will, post the approval of the merger, be categorised as promoters of the combined entity, along  with the existing promoters of Strides,'' a BSE filing said.

The combined entity to be amongst the top 15 listed Indian pharmaceutical companies by revenue with a turnover in excess of Rs 2,500 crore. The board of directors of the combined entity will comprise of independent directors. The appointed date for the Scheme of Amalgamation is April 1, 2015.

The Nifty is hovering around 7950, down 12.80 points at 7956.05. The Sensex is down 32.78 points at 26593.54. About 1846 shares have advanced, 1004 shares declined, and 84 shares are unchanged.

Defensives like pharma and IT lend support while select metal and FMCG stocks correct and midcaps outperform.

Sun Pharma is the top gainer on the Nifty. Its merger with Ranbaxy is expected to be on FIPB agenda on October 1. Additionally, CNBC-TV18 learns the company is planning to focus on dermatology post Ranbaxy merger. It expects almost 38-40 percent of US sales to come from dermatology by FY18.

TCS, Infosys, BHEL, GAIL are top gainers in the Sensex. Among the laggards are the Tata Steel, ITC, Sesa Sterlite, Coal India and Bajaj Auto.

1:50 pm Market outlook: Ambit has introduced 15 stocks in its core opportunities portfolio to benefit from the economic revival. These include Bharat Forge , Ramkrishna Forgings , Alstom T&D and PTC India Financial among others. In an interview to CNBC-TV18, Andrew Holland, CEO of Ambit Investment Advisors, said manufacturing sector will play a key role in India's economy, which this time around will be more 'domestic-driven' than outsourcing based, seen in 2003-2006.

Once the government's kick starts the infrastructure reforms, it will have a multiplier effect on the economy, Holland said. Ambit is upbeat on the companies that are into supply side of this growth story. Ambit sees GDP growth to increase by 1 percent and says the country is likely to see significant FDI in insurance. It expects the road sector to see 8,500-km contract in FY15, and engineering, construction sectors to get big boost.

1:30 pm Buzzing: Shares of IDBI Bank was up 3 percent intraday after its board meeting. In the meeting held on September 26, the board has approved to increase borrowing limit to Rs 15000 crore from Rs 4000 crore.

''The board of directors has approved enhancement in rupee borrowing limit from the present limit of Rs. 4000 crore (approved by the shareholders on September 02, 2014) to Rs 15000 crore subject to compliance with all applicable laws, regulations & guidelines as well as the approval of shareholders to be obtained in terms of Section 42 of the Companies Act, 2013 by postal ballot,'' it said in a statement.

Also, the board has approved to infuse additional capital of Rs 58.34 crore by way of equity in its subsidiary compnay IDBI Asset Management to meet its growth requirements.

The market seems to be tired on first day of week as traders are cautious ahead of RBI policy review. The Sensex is up 23.97 points at 26650.29 and the Nifty is up 2.35 points at 7971.20. About 1851 shares have advanced, 833 shares declined, and 77 shares are unchanged.

Sun Pharma, TCS, BHEL, Infosys and GAIL are top gainers while Hindalco, ITC, HUL, Tata Steel and Bajaj Auto are laggards.

Crude oil futures eased by 0.59 percent to Rs 5,741 per barrel today as speculators reduced their exposures amid a weakening trend in Asian trade. The trading sentiment eased at futures trade after crude oil prices fell in Asian trade today as the US dollar strengthened, analysts said.

Meanwhile, West Texas Intermediate (WTI) crude forNovember delivery dropped 59 cents to USD 92.95, while Brent crude for November fell 25 cents to USD 96.75 a barrel on the New York Mercantile Exchange in mid-morning trade.

1:50 pm Exclusive: While most market experts and economist don't see an interest rate cut anytime soon, SL Bansal, CMD, Oriental Bank of Commerce hopes for some rate cut by the RBI on Tuesday, but adds that banks may not pass it to customers for a month at least. "Why there should be a rate cut beacuse all numbers favourable. Current account deficit (CAD) and commodity prices have come down substantially especially crude prices, so if you cannot cut now, it will be very difficult for you to take a call subsequently," he says.

Meanwhile, Ashish Parthasarthy, Head Treasurer, HDFC Bank expects the central bank to oblige the market with a statutory liquidity ratio (SLR) and held-to-maturity (HTM) cut. He further adds that if these two rates cut come through then the bond yields reaction will be temporary. However, Bansal feels that cut in SLR won't have much impact.

1:30 pm Buzzing: Shares of Patel Integrated Logistics are locked at 20 percent upper circuit, hitting Rs 54.05 intraday after it entered into a cargo alliance with e-tailing major Amazon. It has joined hands with Amazon to fast-track delivery to customers across the country.

The logistics company has begun securing exclusive bookings from airlines to ship Amazon's products ahead of the festive season.

In an interview CNBC-TV18 Areef Patel, Executive Vice Chairman said the company fetches monthly business of around Rs 50-70 lakh and is looking to double this revenue. ''We will be looking at the margins going up as the volumes go up. Unfortunately, over the last couple of months we have had couple of rate increases with the airlines due to the high fuel cost but hopefully that will change if things settle down,'' he said

The market still rangebound. The Sensex is up 25.66 points at 26651.98 and the Nifty is up 5.35 points at 7974.20. About 1728 shares have advanced, 828 shares declined and 79 shares are unchanged. Midcaps, IT and pharma stocks are supportign the indices with smart gains.

Sun Pharma, TCS, BHEL, Infosys and Cipla are top gainers while Hindalco, HUL, Tata Power, Coal India and ITC are among the laggards in the Sensex.

All eyes are now on the Reserve Bank of India as the market gears up for the policy announcement tomorrow. A CNBC-TV18 poll suggests that Raghuram Rajan may hold fire this time. Bankers, dealers and company CFOs expect no rate cut in the policy tomorrow but a tone as hawkish as august.

FIIs turn bullish on India as PM Modi wows audiences in New York. Rajeev Bhaman of Oppenheim believes Indian stock market can double over the next five years if government provides policy support. He maintains that India is the best among emerging markets.

11:55 am Oil check: Crude oil futures eased by 0.59 percent to Rs 5,741 per barrel today as speculators reduced their exposures amid a weakening trend in Asian trade.
At the Multi Commodity Exchange, crude oil for delivery in October traded Rs 34, or 0.59 per cent, to Rs 5,741 per barrel in 2,312 lots.

In a likewise fashion, oil for November delivery moved down by Rs 30, or 0.52 per cent, to Rs 5,721 per barrel in 96 lots.

11:30 am Market outlook: India received a shot in the arm as global rating agency Standard & Poor's on Friday revised India's credit outlook to "stable" from "negative", acknowledging the improvement in the country's economic environment. The revision was backed by an improvement in India's external position and growth prospects and means it's no longer on the brink of a "junk" rating.

S&P was the last of the three main global ratings agencies with a negative outlook on India; Moody's never changed India's outlook, while Fitch upgraded it to stable in 2013. Although Moody's outlook on India remains stable, Andrew Colquhoun, Head of Asia-Pacific Sovereign Ratings Group at Fitch Ratings doesn't see any chance of an alteration in ratings for India in the medium-term.

The Nifty starts the week in consolidation mode as traders seem to be cautious ahead of the Reserve Bank of India's monetary policy review tomorrow. The 50-share index is down 1.20 points at 7967.65. The Sensex is up 35.34 points at 26661.66. About 1633 shares have advanced, 663 shares declined, and 66 shares are unchanged.

Defensives continue to gain as Sun Pharma builds on to Friday's rally while banks trade mixed & metals are weak. TCS, BHEL, Cipla and Infosys are top gainers in the Sensex. On the losing side are Hindalco, M&M, Tata Power, Coal India and Bharti Airtel.

Tourism stocks are higher after the PM Narendra Modi eased visa norms for US nationals and PIO card holders.

NSE's volatility gauge, India VIX has surged 7.3 percent and is heading towards fourth day of gains in five on fears of foreign investor sales. It has risen nearly 20 percent since September 22. Traders cite uncertainties including the Supreme Court's cancellation of most coal blocks allotted since 1993. State elections in October are also seen weighing.

Globally, Asia is mixed while Hang Seng is at a two-month low on account of pro-democracy.
10:50 am Market cap: Amid weakening stocks, the combined market valuation of top five Sensex companies fell by Rs 45,887.6 crore last week, with RIL and ICICI Bank taking the biggest hit. While TCS , RIL, Infosys, SBI and ICICI Bank saw losses in their market capitalisation (m-cap), ONGC, ITC, CIL, HDFC Bank and Sun Pharma witnessed addition. The m-cap of RIL plunged Rs 19,728.88 crore to Rs 3,01,948.82 crore. ICICI Bank suffered a loss of Rs 10,682.94 crore to Rs 1,71,031.83 crore, while the value of SBI dipped by Rs 9,376.96 crore to Rs 1,82,380.34 crore.

10:30 am Buzzing: Shares of MTNL were up 5 percent intraday as reports suggested that the state-run company will not be privatised but will be turned around. According to a media report telecom minister Ravi Shankar Prasad has said that the loss-making state-owned telecom service providers, Bharat Sanchar Nigam (BSNL) and MTNL will not be privatised instead they will be turned around.

He was quoted as saying 'experience in turning around loss-making PSUs and has done so with Coal India when he was coal minister during the Vajpayee government's regime'.

However, he did not provide any fixed time-frame or share any strategy but added that he was closely monitoring them.

The Nifty is struggling below the 8000-level. The 50-share index is up 5.70 points at 7974.55 and the Sensex is up 45.89 points at 26672.21. About 1434 shares have advanced, 510 shares declined, and 48 shares are unchanged.

Both Sun Pharma and TCS are up 3 percent each. BHEL, Wipro and Infosys are top gainers in the Sensex. Among the losers are Hindalco, Tata Power, Bharti Airtel and Coal India.

The dollar hit a four-year peak against a basket of currencies in early Asian trade on Monday, bolstering Japanese shares, but other Asian shares shrugged off Friday's Wall Street rebound in the face of political unrest in Hong Kong.

Hong Kong shares dropped 2.3 percent to three-month lows in the worst unrest since China took back control of the former British colony two decades ago.

MSCI's broadest index of Asia-Pacific shares outside Japan dropped 0.7 percent, hitting its lowest level since mid-May. Even the usually calm Hong Kong-dollar, which is pegged to a narrow band against the US dollar, slipped 0.1 percent to 7.761 against the greenback, its lowest level since March, as the street clashes affected some banks' operations.

9:55 am Buzzing: Shares of Anant Raj jumped 8.5 percent intraday on Monday after it announced sale of its wholly-owned subsidiary Greatway Estates for Rs 304.12 crore. The real estate company aid the fund would be utilised to part repayment of debt and project development.

In a filing to the BSE, Anant Raj informed that the board at its meeting "approved the sale of 100 percent equity stake in its wholly owned subsidiary Greatway Estates for a consideration of Rs 304.12 crore."

"The consideration received shall be utilised partly for repayment of debt and partly for development of the projects of the company," it added.

Anant Raj posted net profit of Rs 100.38 crore on revenue of Rs 503.11 crore for 2013-14. It had a debt of about Rs 1,400 crore at the end of last fiscal.

9:35 am Market outlook: The Indian equity market is fundamentally in a bull phase, says Jaideep Goswami, Head of Equity, ICICI Securities. In an interview with CNBC-TV18, he cautions that one has to identify the triggers that can move the market on the downside. ICICI Securities has Nifty target of 9,200 for the next 12 months. On specific sectors, Goswami is positive on the FMCG space given the increasing demand in this segment. He is positive on Marico . He also likes the IT sector. With Vishal Sikka taking over Infosys and clarity on management issues, there is a possibility of a PE re-rating in the stock, he says. From the realty space, he is bullish on Sobha Developers .

The market has opened on a flat note. The Sensex is up 8.81 points at 26635.13 and the Nifty is up 9.60 points at 7978.45. About 474 shares have advanced, 127 shares declined, and 22 shares are unchanged.

Tata Steel, Wipro, Axis Bank, Reliance and Infosys are top gainers in the gainers while HUL, Coal India, ITC, Tata Motors and Bharti Airtel are major laggards in the Sensex.

Meanwhile, Prime Minister Narendra Modi received a rock star reception at Madison square garden. As a Navratara gift for a rapturous crowd of NRIs, persons of Indian origin cardholders to get lifetime Indian visa. Modi said he wants the world to 'Make in India', lists democracy, demographic dividend & demand as India's biggest strengths.

Globally, US stocks rose sharply on Friday, cutting losses for the week, after the government raised its estimate of economic growth in the second quarter and consumer sentiment rose in September.

And on the economic data front, the us economy grew at an annual rate of 4.6 percent in the second quarter. In commodities, Brent crude trades close to 97 levels giving back most of their gains from the previous session as dollar strengthens. From precious metals space, gold prices fall as a dollar-driven rally encouraged by US economic growth dimmed bullion's investment appeal.