Sensex, Nifty end lower; HDFC, Hero, BHEL major losers

05 Sep 2014

03:30 Market close
The market has once against ended lower. The Sensex was down 70.51 points at 27015.42 and the Nifty slipped 11.85 points at 8084.10. About 1689 shares have advanced, 1280 shares declined, and 118 shares are unchanged.

Hero MotoCorp, HDFC, Coal India, BHEL and ICICI bank are top losers in the Sensex. Among the gainers are L&T, Bajaj Auto, SBI, Cipla and ONGC.

03:00pm Info Edge QIP
The QIP committee of the company on Thursday has approved the preliminary placement document in connection with the QIP and decided to open the QIP issue on September 04.

"Accordingly the floor price in respect of the aforesaid QIP, based on the pricing formula as prescribed in under SEBI regulations, is Rs 766.89 per equity share," said the company in its filing. The stock gained more than 4.5 percent.

02:45pm JSW Steel in News
Shares of JSW Steel gained more than 2 percent on strong improvement in steel production in the month gone by. OP Jindal Group company has reported a 13 percent growth in crude steel production at 11.16 lakh tonnes, increased from 9.85 lakh tonnes in the year-ago period.

"Flat steel products grew by 7 percent to 8.8 lakh tonnes from 8.24 million tonnes and long steel products' growth was a whopping 53 percent in August at 1.96 lakh tonnes compared to 1.28 lakh tonnes in corresponding month of last year," said the company in its filing.

02:25pm Jaypee-RPower exclusivity pact likely to be extended
The exclusivity period of the pact for Reliance Power's proposed acquisition of Jaiprakash Associates' hydro power portfolio in a Rs 12,000 crore deal is likely to be extended by 60 days.

In one of the biggest deals in the power space, Anil Ambani Group firm Reliance Power in July announced that it had signed an initial agreement to acquire all the three hydroelectric power plants of Jaiprakash Associates Ltd. The deal would be worth about Rs 12,000 crore.

Investment banking sources said the exclusivity period of the agreed Memorandum of Understanding (MoU) for the proposed deal is likely to be extended by 60 days.

The MoU between RPower and Jaypee Group was signed on July 27 and the exclusivity period was to end on September 25, reports PTI.

02:00pm Equity benchmarks remained under selling pressure amid consolidation in afternoon trade weighed down by private banks and auto stocks. The Sensex declined 47.40 points to 27038.53 and the Nifty fell 9.15 points to 8086.80.

The broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising 0.7 percent and 1.1 percent, respectively. Advancing shares beat declining ones by a ratio of 1597 to 1239 on the BSE.

Sachin Shah, Fund Manager at Emkay Investment Managers believes the undertone for the market continues to remain buoyant on the back of good foreign insitutional investor (FII) flows and net buying from domestic mutuals funds.

There have been some positive signs on the macro front too like oil remaining subdued, some good quarterly results and government making right noises, which would keep up the buoyancy, says Shah.

State-run iron ore miner NMDC and realty major DLF topped the buying list in Nifty 50, up more than 4 percent followed by Jindal Steel, Asian Paints, ONGC, L&T and Bajaj Auto with 1-3 percent.

However, United Spirits dropped over 3 percent as Credit Suisse reduced its target price on the stock to Rs 2200 from Rs 2700 earlier and lowerd FY15-16 earnins per share estimates by 30-50 percent.

Shares of HDFC, Coal India, BHEL, NTPC, ICICI Bank, Tata Motors, Sun Pharma, Bharti Airtel, Hero Motocorp and Tata Power declined 1-2 percent.

1:40 pm Market outlook: Indian equities are not overvalued at this point and the Nifty could touch 9000 by March, feels Vibhav Kapoor, group Chief Investment Officer, IL&FS. In an interview with CNBC-TV18, Kapoor says global equities in general are in a sweet spot, and even if the Fed were to hike rates, liquidity flows to emerging market would not impacted in a big way. Kapoor feels some capital goods shares are expensive at current levels, but he is bullish on Larsen and Toubro if the economy can sustain the pace of recovery seen in the first quarter.

Similarly, he says he will turn positive on banks and NBFCs if the economy continues to be on the mend. Kapoor says concerns over high interest rates is a cause of worry for the market, but does not see the RBI cutting rates near term.

Selling pressure continues in the market. The Sensex is down 100.91 points at 26985.02 and the Nifty is down 27.30 points at 8068.65. About 1437 shares have advanced, 1282 shares declined, and 112 shares are unchanged.

HDFC, Coal India, BHEl, ICICI Bank and Hero are top losers in the Sensex. Among the gainers are Bajaj Auto, ONGC, L&T, SBI and Cipla.

JP group stocks are in focus today as they extend their losses. JP Associates loses 13 percent today bringing its weekly losses to almost 30 percent. Brokerages turn bearish on the stock as debt concerns for the company mount.

It is a mixed day of trade in Asia and Europe as caution prevails before the release of the US nonfarm payrolls data and peace talks between the Ukrainian president & pro-Russian rebels.

12:50pm Sharda IPO opens
Sharda Cropchem, a crop protection chemical company entered the primary market with its initial public offering (IPO) with Rs 352-crore public offer, essentially to adhere to SEBI public shareholdings norm of creating a 25 percent public float, says RV Bubna, CMD, Sharda Cropchem.

Bubna feels it is not wise for their business to invest in plant and machinery and therefore, the company invests in agro chemical registrations. They have recently entered into the biocide segment and acquired several registrations from the existing registration holders, in Europe and China. Currently, they have 1,200 registrations globally and further registrations are anticipated to grow at 15-20 percent, he says in an interview with CNBC-TV18.

Cash-rich Sharda has an asset-light business model with zero debt, he says adding that they have Rs 190 crore cash in hand as of March 2014. In addition, Bubna expects margins to be above 40 percent hereon.

12:30pm Jyoti at 20% upper circuit
Jyoti Ltd subsidiary bagged a hydropower order worth Rs 423 crore, of which the company's share in the order is worth just Rs 100 crore, says Ajay Kamdar, Chief Financial Officer, Jyoti Limited.

The Gujarat-based hydro turbines and generators manufacturer's JV with Megha Engineering & Infrastructure has won a 5-year deal from Narmada Nigam for EPC of civil, electro-mechanical and hydro-mechanical works including operations and maintenance for Saurashtra Branch Canal Project in Mehsana district.

12:00pm The market erased early gains with the Sensex falling 101.53 points to 26984.40 and the Nifty losing 27.10 points to 8068.85 weighed down by private banking and financials, auto and healthcare stocks.

About 1314 shares have advanced, 1249 shares declined, and 104 shares are unchanged.

State-run power equipment maker BHEL and coal mining company Coal India are prominent losers, falling 2 percent each followed by HDFC, ICICI Bank, HDFC Bank, Sun Pharma, Bharti Airtel, Hero Motocorp and Tata Power with 0.6-1.6 percent.

However, shares of L&T, ONGC, SBI, Infosys, TCS, GAIL, Bajaj Auto and Hindalco Industries bucked the trend, up 0.3-1 percent.

In the midcap space, Gujarat Flourochem, Tilak Finance, Trinity Trade, Bharat Electronics and Voltas rallied 5-10 percent whereas Jaypee Infra, Punj Lloyd, IFCI, Suzlon Energy and GMR Infra lost 5-8 percent.

1:55 am Market outlook: Indian equities are not overvalued at this point and the Nifty could touch 9000 by March, feels Vibhav Kapoor, group Chief Investment Officer, IL&FS.

In an interview with CNBC-TV18's, Kapoor says global equities in general are in a sweet spot, and even if the Fed were to hike rates, liquidity flows to emerging market would not impacted in a big way.

Kapoor feels some capital goods shares are expensive at current levels, but he is bullish on Larsen and Toubro if the economy can sustain the pace of recovery seen in the first quarter.

Similarly, he says he will turn positive on banks and NBFCs if the economy continues to be on the mend. Kapoor says concerns over high interest rates is a cause of worry for the market, but does not see the RBI cutting rates near term.

 11:30 am Buzzing: Shares of Jyoti hit 20 percent upper circuit at Rs 79.30 per share, riding on the largest hydel order received by it till date.

The Gujarat-based hydro turbines and generators manufacturer's JV with Megha Engineering & Infrastructure has won a 5-year deal from Narmada Nigam for EPC of civil, electro-mechanical and hydro-mechanical works including operations and maintenance for Saurashtra Branch Canal Project in Mehsana district.

The Jyoti's portion in the order is worth around Rs 100 crore for supply of electro-mechanical equipment, the company said. Power produced from these plants will offser power required for canal operation to some extent.

The market is consolidating for second day with major support from IT, oil, infra and metals. The Sensex is up 34.26 points at 27120.19 and the Nifty is up 15.20 points at 8111.15. About 1488 shares have advanced, 847 shares declined, and 103 shares are unchanged.

ONGC, GAIL, Hindalco, Bajaj Auto and L&T are major gainers in the Sensex. Among the losers are HDFC, Coal India, Bharti Airtel, BHEL and Hero MotoCorp.

The only reason for the market to correct right now is to take catch its breath, before it takes off again, as there is nothing in negative lurking around the corner that could halt the equity market bull run. That's the word coming in from CNBC-TV18's Udayan Mukherjee, who believes a correction, if and when it happens, is unlikely to be a massive one.

Mukherjee says it is heartening to see that the market, while it makes new highs almost every other day, is punishing stocks with faulty fundamentals.

''This tells you the rally has not been an indiscriminate one. In the past you would see many rallies, which have often meant anything high beta has actually outperformed the Nifty. That has not happened this time around. So many infra stocks are down in the last three months. Real estate as a sector has got smashed up and any stocks, without mentioning names, which owed its past gains to political patronage of some kind or has not be able to fix their balance sheet despite this kind of buoyant equity market are getting punished,'' he said.

The European Central Bank cut interest rates and launched a large stimulus package for the flagging euro zone economy on Thursday. Traders are now awaiting the US nonfarm payrolls for further direction.

10:55am Market Expert
Indian equities are not overvalued at this point and the Nifty could touch 9000 by March, feels Vibhav Kapoor, group Chief Investment Officer, IL&FS.

In an interview with CNBC-TV18, Kapoor says global equities in general are in a sweet spot, and even if the Fed were to hike rates, liquidity flows to emerging market would not impacted in a big way.

Kapoor feels some capital goods shares are expensive at current levels, but he is bullish on Larsen and Toubro if the economy can sustain the pace of recovery seen in the first quarter.

10:25am Infosys on buyers' radar
Shares of Infosys gain a percent as investors celebrate clenching its first big deal under new leadership of Vishal Sikka. The IT firm bagged five-year deal worth USD 500 million with BP.

As per the agreement, Infosys will provide IT services across BP's operations, including corporate functions, upstream, and downstream segments, energy trading and marketing in Houston, Texas, UK, Azerbaijan, Angola, Brazil and Singapore.

JP Morgan maintains overweight rating on Infosys with a December 2015 price target of Rs 3900, stating that the recent management change has potentially delayed revenue growth recovery but has also brought much-needed visibility.

10:00am Equity benchmarks continued to trade with marginal gains with the Sensex rising 30.38 points to 27116.31 and the Nifty gaining 11.80 points to 8107.75 supported by technology, oil & gas and metals stocks.

The broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices advancing 0.7 percent and 0.9 percent, respectively. About two shares advanced for every share declining on the Bombay Stock Exchange.
 
NMDC topped the buying list in Nifty 50, up nearly 3 percent followed by ONGC, Infosys, DLF and GAIL with more than a percent gain.

Larsen and Toubro climbed over a percent too on getting a turnkey order for setting up a 2X660 MW supercritical thermal power project at Shree Singaji TPP on a complete engineering-procurement-construction basis from the state utility MP Power Generating Company. The company said the order, which is valued over Rs 5,100 crore, demands stringent completion schedule of 43/47 months (first unit/second unit).

However, HDFC, Coal India, Bharti Airtel, BHEL, Hero Motocorp, United Spirits and BPCL lost 1-2 percent.

9:55 am Buzzing: Shares of Infosys jumped over 2 percent intraday on Friday as investors celebrate clenching its first big deal under new leadership of Vishal Sikka. The IT firm bagged five –year deal worth USD 500 million with BP.

As per the agreement, Infosys will provide IT services across BP's operations, including corporate functions, upstream, and downstream segments, energy trading and marketing in Houston, Texas, UK, Azerbaijan, Angola, Brazil and Singapore.

9:30 am Market opinion: Hans Goetti, Head of Investment - Asia, Banque Internationale says with the European Central Bank (ECB) cutting rates there will be outflow of money from euro into US dollars.

He says the ECB has delivered more than the market expected, which could eventually lead to quantitative easing and expansion of ECB balance sheet.

According to him the technical support fot the euro is around 1.28 levels in the near-term but it could also see levels of 1.20 in the medium-term in case the ECB follows through with expansion of its balance sheet and the Fed at the same time keeps tapering by not expanding the  balance sheet.

After a resting day, the market seems to be picking up pace slightly again. The Sensex is up 52.05 points at 27137.98 and the Nifty is up 3.95 points at 8099.90. About 427 shares have advanced, 163 shares declined, and 37 shares are unchanged.

Infosys, Wipro, Reliance, NTPC and Cipla are big movers in the Sensex. Among the losers are Tata Power, GAIL, ONGC, Hindalco and Bharti Airtel.

The Indian rupee has opened at 60.44 a dollar, down by 9 paise compared to previous day's closing value of 60.35 a dollar.

Pramit Brahmbhatt, Veracity says investors are likely to trade cautiously today post the profit booking in the equity market yesterday. "The series of US data expected today will help investors gauge the market," he adds.

He expects the rupee to trade range bound to slightly weak. Meanwhile, the euro skid below 1.30 to the dollar suffering its biggest one-day fall in nearly three years after the European Central Bank delivered a fresh round of stimulus and promised even more if needed.

In the US, stocks erased record-setting gains on turning lower in a late-session shift as cheer over the European Central Bank's unexpected rate cut faded, a day ahead of the monthly payrolls report. Non-farm payrolls are estimated to show that economy created 225,000 jobs in August.

In commodities, crude prices slipped following a strong dollar, hitting commodities priced in the US currency.From precious metals space, gold slipped as dollar rallied on ECB rate cuts.