Sensex rises 109 points; Bank Nifty up 2.5%, CNX IT slips 4%

17 Oct 2014

03:30pm Market Closing
Equity benchmarks closed off day's high ahead of Maharashtra and Haryana state elections results that will be announced on Sunday. The Sensex climbed 109.19 points to 26108.53 and the Nifty rose 31.50 points to 7779.70.

Banks topped the buying list with the Bank Nifty rising 2.5 percent while technology stocks saw huge selling pressure with the CNX IT index falling 4 percent.

BHEL, Hero Motocorp, HDFC Bank, M&M, ICICI Bank, Zee Entertainment and Cipla rallied 3-4 percent while TCS and HCL Technologies plunged 9 percent each followed by Sesa Sterlite, Hindalco, Tata Motors, Wipro and Jindal Steel with 1-2.8 percent loss.

About 1335 shares advanced while 1505 shares declined on the Bombay Stock Exchange.
02:55pm Crompton in focus

Avantha Group-owned Crompton Greaves is likely to sell part stake in its demerged consumer products business, sources told CNBC-TV18.

Crompton Greaves on Thursday had announced the demerger of its consumer products business unit into a separate company and also opened doors for foreign investors by raising the investment limit to 100 percent of the paid-up equity share capital.

According to sources, the group may sell up to 10 percent stake in the demerged consumer products entity to private equity players, with valuations standing at around Rs 8000 crore. So far, Bain has emerged as the only serious PE player in talks to acquire stake.

02:40pm Zee Entertainment rallies
The Sensex gained more than 200 points in last hour of trade while Zee Entertainment climbed nearly 4 percent.

Zee slightly missed street expectations on topline and bottomline front but operational performance was higher than expectations during July-September quarter. Consolidated net profit fell 3.7 percent to Rs 227.6 crore in second quarter of current financial year 2014-15 due to lower subscription revenue and sports division losses. Profit in the year-ago period was Rs 236.3 crore.

Net profit was expected at Rs 235 crore on revenue of Rs 1,160 crore for the quarter, according to the average of estimates of analysts polled by CNBC-TV18.

Consolidated total income from operations increased marginally to Rs 1,118 crore from Rs 1,101 crore on year-on-year basis. Advertising revenue in Q2 increased 7 percent on yearly basis to Rs 625.94 crore while subscription revenue declined over 7 percent to Rs 424.45 crore from Rs 458.12 crore during the same period.

02:25pm Market Check
The Sensex shot up 180.51 points or 0.69 percent to 26179.85 and the Nifty jumped 52.55 points or 0.68 percent to 7800.75.

About 1282 shares have advanced, 1390 shares declined, and 103 shares are unchanged.

02:20pm Top Gainers
Shares of HDFC Bank, Mahindra and Mahindra and BHEL topped the buying list in the Sensex, up 3-4 percent followed by ICICI Bank, HDFC, Larsen and Toubro, State Bank of India, Axis Bank, Bharti Airtel, Hero Motocorp, Tata Steel and Cipla with 2-2.7 percent gains.

Index heavyweights ITC and Reliance Industries climbed nearly a percent.

02:00pm Market Check
Equity benchmarks extended gains with the Sensex rising 166.02 points to 26165.36 and the Nifty climbing 48.90 points to 7797.10. The broader markets gained too; the CNX Midcap advanced 0.8 percent.

Banks stocks drove the major gains in benchmarks with BSE Bankex rising over 2 percent while technology stocks pulled the BSE IT index down by 3.5 percent.

Sunil Singhania of Reliance MF says he expects growth to return to the Indian markets. He is looking at a 20 percent earnings growth over the next five years and valuation wise, India is not as expensive as other emerging markets.

It's a twin blow for the tech sector. TCS tanked more than 7 percent after dollar revenue growth missed expectations. Management told cnbc-tv18 that softness in certain businesses may continue for two more quarters. HCL Technologies too took a hard knock on similar growth worries; dollar revenue for Q1 came in lower than estimate; the stock lost 9 percent.

The rupee recovered marginally to 61.53 after falling to 7-month low of 61.83 yesterday. Fresh selling of dollars by exporters and banks resulted in rupee recovery.

It is a mixed day for global markets. European markets gained more than 1 percent while Asian markets like Japan and Taiwan Weighted fell another 1-1.5 percent after yesterday's blow. A comment from hawkish Federal Reserve official James Bullard on Thursday that the Fed should continue bond buying lifted sentiment and surprised many observers.

01:59pm Interview
Tyre companies have been buzzing of late as Brent crude fell to 4-year low on supply glut, in turn causing synthetic rubber, one of tyre companies' key raw materials saw price fall too.

Subba Rao Amarthaluru, CFO, CEAT anticipates a 10 percent growth in second half of FY15 as plummeting crude prices will reflect in prices of its derivatives such as synthetic rubber, carbon black and nylon tyre chord.

As another shot in the arm, tyre major is also facing headwinds in export markets.

01:40pm NIIT tanks post earnings
Computer training and software services company NIIT's second quarter (July-September) consolidated net profit fell 14.2 percent to Rs 10.3 crore compared to Rs 12 crore in same quarter last year on lower operational performance. The stock fell nearly 5 percent.

Consolidated net sales declined marginally to Rs 260.4 crore from Rs 262.4 crore during the same period.

Earnings before interest, tax, depreciation and amortisation (EBITDA) dropped 25.5 percent to Rs 18.1 crore in the quarter ended September 2014 from Rs 24.3 crore in the year-ago period.

01:20pm FII View
Manpreet Gill, Senior Investment Strategist, Standard Chartered continues to remain overweight on the Indian market. According to him, the drivers for market remain primarily domestic.

India remains one of his preferred markets with the Asia pacific region, he adds. 

Gill expects the US Federal Reserve to raise rates by mid-2015. He believes the US companies have reported strong up-trending earnings path.

01:00pm Equity benchmarks gained strength in afternoon trade supported by banking and financials, capital goods and index heavyweights like ITC and Reliance Industries.

The Sensex rose 111.89 points to 26111.23 and the Nifty climbed 36.85 points to 7785.05. About 1123 shares have advanced, 1422 shares declined, and 94 shares are unchanged.

Bank Nifty jumped 300 points as ICICI Bank, HDFC Bank, State Bank of India and Axis Bank gained 2-2.6 percent. Housing finance company HDFC too rallied 2 percent. Capital goods majors Larsen and Toubro, and BHEL climbed 2-3 percent.

Utility vehicle maker Mahindra and Mahindra topped the buying list, up 3.5 percent followed by Bharti Airtel, ITC, Tata Steel, Cipla, NTPC and Hero Motocorp with 1-2 percent.

However, HCL Technologies and TCS remained under selling pressure, falling 8-9 percent after reporting lower than expected revenues in September quarter.

In the midcap space, Crompton Greaves jumped over 2 percent after sources told CNBC-TV18 that Avantha Group may sell partial equity stake in demerged Consumer Products business. Bain among PE players is in talks to acquire that stake, say sources.

On the global front, European markets bounced back in opening trade after yesterday's sharp cut.

12:25pm Nikkei Update
Japanese stocks fell today, capping their worst week in six months as investor fears of slowing global growth trumped relief over a set of upbeat data from the United States.

The Nikkei average lost 1.4 percent to close at 14,532.51. Over the week it has shed 5 percent.

Exporter shares underperformed, with Toyota Motor Co slipping 2.5 percent and Panasonic Corp losing 0.9 percent.

The broader Topix dropped 1.5 percent to 1,177.22, while the new JPX-Nikkei Index 400 slid 1.6 percent to 10,712.64, reports Reuters.

12:00pm Market Check
It's another choppy session on Dalal Street but the market bounced back from session lows. The Sensex climbed above 26000 level, up 71.74 points at 26071.08 and the Nifty jumped 21 points to 7769.20.

TCS tanked more than 7 percent after the IT major missed street estimates. Dollar revenue at USD 3.9 billion felt shy of estimates, but net profit came in-line. The management told CNBC-TV18 that softness in certain businesses may continue for 2 more quarters and that meeting FY14 growth will be difficult in FY15.

HCL Technologies slipped almost 8 percent. Dollar revenue for the first quarter came in lower than the lowest estimate on the street. EBIT margin was maintained at 23.9 percent despite wage hikes. The management expects utilisation rates to improve in next few quarters.

Tata Motors, Sesa Sterlite, Hindalco Industries and Maruti Suzuki slipped 1-2 percent.

However, top private sector lender ICICI Bank, utility vehicle maker Mahindra and Mahindra, telecom operator Bharti Airtel and state-run power equipment maker BHEL extended gains in noon trade, up 2-3 percent. HDFC Bank, L&T, HDFC, SBI, Tata Steel, Wipro and Cipla climbed 1-1.7 percent.

Axis Bank gained 1.5 percent ahead of earnings. A CNBC-TV18 expects a 14 percent growth in net interest income while profit is seen rising by 18 percent in the second quarter year-on-year.

11:30am Interview
Print media major DB Corp expects its Maharashtra business to become profitable by March this fiscal, Pawan Agarwal, deputy managing director at DB Corp said in an interview to CNBC-TV18.

Agarwal said the Bihar business was doing well and the company was maintaining its leadership position in the Patna newspaper market.

He expressed hope that reforms by the government to revive the economy would help the company grow in the current half of this fiscal.

11:00am Market Check
The market remained lacklustre ahead of Maharashtra and Haryana Assembly elections results in the weekend. The Sensex declined down 29.09 points to 25970.25 and the Nifty slipped 7.20 points to 7741.

The broader markets too were down with the BSE Midcap and Smallcap indices falling 0.2-0.3 percent. About 916 shares have advanced, 1252 shares declined, and 85 shares are unchanged on the Bombay Stock Exchange.

Banking and financials, capital goods and FMCG stocks saw buying interest while oil & gas, metals and select technology stocks were under pressure.

TCS kept its position in the selling list, down nearly 8 percent followed by Sesa Sterlite, Tata Motors and Hindalco Industries with a 3 percent loss. However, ITC, ICICI Bank, M&M, L&T, Bharti Airtel, SBI, BHEL and Axis Bank gained 1-3 percent.

In the midcap space, Shoppers Stop, NBCC, Responsive Industries, Alstom T&D and Trent surged 3-6 percent while CMC tanked 14 percent post the boards of directors of company and TCS announced merger of both companies. Atul, Rallis India, Amtek Auto and Trinity Trade lost 5-10 percent.

10:55am Rallis India crashes 7%
Tata group firm Rallis India reported marginal decline in its consolidated net profit to Rs 73.43 crore for the quarter ended September 30. The company had clocked a net profit of Rs 74.75 crore in the same quarter last year.

The total income from operations of the company during the June-September period rose to Rs 641.94 from Rs 502.40 crore in the year ago period.

Rallis India Managing Director and CEO V Shankar said, "The long drought like spell followed by heavy rains in certain areas did not augur well for the normal cropping pattern affecting yields and farm incomes."

10:40am Interview
Discussing the second quarter earnings details, N Chandrasekaran, CEO and MD, TCS, said the second quarter has been good in terms of volume and robust utilisation rates, but the it "typically does better in Q2''.

According to him, the India growth is back on track and customers have been going through a transformation. He expects North America, Europe and UK to continue to do well.

Explaining the slight miss in expectations, Chandrasekaran said the Q2 performance was below estimates on constant currency terms. He expects the growth in insurance business to remain soft and sees it (softness) to continue in select business for two quarters.

It would be difficult to meet FY14 growth in FY15, Chandrasekaran said, adding that the company would be comfortable with the margin range 26-28 percent.

10:20am Market Expert
The recent sell-off in the market is due to a fall in crude oil prices, says Deven Choksey, KR Choksey Shares and Securities. Going ahead, he says if the crude price settles between USD 80-84, then the sell-off will stop as investors will look to recover the losses. But if crude continues to fall further, then the market can crack further.

He believes the market is likely to take support between 7600 and 7650, if not there will be further cut. But as of now, he is taking a gradual view and sees the trading range between 7600 and 7900.

10:00am Market Check
Equity benchmarks continued to consolidate at around 26000 level on the Sensex and 7750 on the Nifty. Technology (barring Infosys), select metals and auto stocks were under pressure while banks, FMCG, capital goods and healthcare stocks gained.

The Sensex rose 4.27 points to 26003.61 and the Nifty advanced 4.35 points to 7752.55. About 987 shares have advanced, 1003 shares declined, and 88 shares are unchanged.

TCS and HCL Technologies extended losses, down 8 percent after both the companies reported lower than expected numbers on revenue front in the quarter ended September 2014.

Sesa Sterlite, Tata Motors, Hindalco Industries, Wipro, DLF and Jindal Steel were down 1-3 percent.

However, Zee Entertainment gained nearly 4 percent ahead of second quarter earnings today. Mahindra and Mahindra rebounded with 2.60 percent gains followed by Bharti Airtel, BHEL, ITC and ICICI Bank with 1-2 percent upmove.

09:56am FII View
Caesar Maasry of Goldman Sachs says MSCI Emerging Markets (EM) Index has fallen 11 percent since the early September peak, but unlike Developed Markets (DM) equities, the pace has softened in recent days. "Cyclical equities in developed markets are underperforming, but the flat performance of our China growth cyclicals basket suggests that growth concerns were discounted earlier," he adds.

According to him, EM equities may remain relatively defensive vs developed markets in the near term.

09:35am Crompton Greaves under pressure post earnings
Crompton Greaves missed street expectations on every parameter with the second quarter consolidated net profit rising 19 percent year-on-year to Rs 69.6 crore. Profit in the year-ago period was Rs 58.41 crore. The stock fell nearly 2 percent.

According to the average of estimates of analysts polled by CNBC-TV18, profit was expected at Rs 80.2 crore on revenue of Rs 3,508 crore for the quarter.

Consolidated net sales grew by 5.8 percent to Rs 3,430.3 crore in the quarter ended September 2014 compared to Rs 3,241.35 crore in corresponding quarter of last fiscal.

09:15am Market Check
Equity benchmarks started of Friday's trade on a positive note post yesterday's sharp cut but it could not sustain those gains. It got back to consolidation mode with the Sensex rising 2.70 points to 26002.04, and the Nifty falling 4.60 points to 7743.60.

About 781 shares have advanced, 373 shares declined, and 33 shares are unchanged.

Hero Motocorp gained 1.68 percent post a 58 percent jump in second quarter net profit. Bharti Airtel, M&M, ITC, HUL, Zee Entertainment (ahead of earnings) and Asian Paints rallied 1.2-1.7 percent.

TCS tanked 7.41 percent on profit booking and lower than expected revenue numbers in the quarter ended September 2014. HCL Technologies crashed over 6 percent after its revenue missed expectations. Tech Mahindra was down 4.53 percent.

Sesa Sterlite, Wipro, Tata Motors, Hindalco, and DLF were other losers.

The Indian rupee has opened higher by 15 paise at 61.68 a dollar on Friday compared to previous day's closing value of 61.83 a dollar.

Pramit Brahmbhatt, Veracity feesl local equity market is likely to trade sideways and will take cues from global markets for further directions. He expects the rupee to trade firm after yesterday's fall although the strength in the dollar will keep the currency under pressure.

According to him, the rupee is expected to trade in the range of Rs 61.40-62.40/USD.

The dollar recovered given the relative strength of the US economy and the Federal Reserve's commitment to tighten monetary policy.

On the global front, Asian markets were trading mixed with the Nikkei falling marginally. US stocks ended little changed, with the Dow industrials recouping much of a 206-point deficit, as investors balanced worries about global growth against mostly better-than-expected US earnings and economic reports.

In Europe, shares closed lower after trimming losses in late afternoon trade, tracking US markets which partially recovered after visiting correction territory, even as fears surrounding Greece's stability resurfaced.

In commodities, Brent crude rises to USD 86 per barrel buoyed by robust economic data and as US gasoline inventories last week fell to their lowest in nearly two years.