Sensex ends 112 points down, Nifty below 8350; BHEL jumps 5%
26 May 2015
03:30 pm Market close: The market ended at lower levels. The Sensex was down 112.47 points or 0.4 percent at 27531.41 and the Nifty was down 30.90 points or 0.4 percent at 8339.35. About 1176 shares have advanced, 1482 shares declined, and 175 shares are unchanged.
After beating estimates by its March quarter results, BHEL ended with 5 percent gains. Coal India, Hero MotoCorp, Maruti and Bajaj Auto are top gainers in the Sensex. Among the losers are ONGC, Vedanta, Tata Motors, NTPC and Reliance.
03:00 pm Buzzing: DTH service provider Dish TV surpassed street expectations on every parameter on Tuesday with the fourth quarter profit at Rs 35 crore against loss of Rs 149 crore in the year-ago period.
Total income from operations grew by 18.5 percent to Rs 754.7 crore during January-March quarter compared to Rs 636.91 crore in the corresponding quarter of last fiscal. Better-than-expected subscription revenue boosted earnings during the quarter. Subscription revenue climbed 24.4 percent on yearly basis to Rs 682.8 crore in Q4FY15. Stock is up 15 percent.
02:30pm Dipen Sheth, head of institutional research, HDFC Securities believes the past one year has just been a milestone in what is a 10-year bull run and will give some serious opportunities to long-term investors to enter this market all over again.
According to him, the Indian bull run story is in no danger of breaking. ''It is just that the weaker hands are having this re-think as we look at it. There are certain things to complain about and crib about and some risks which are visible to investors and that is why you had the pullback,'' he adds.
Speaking to CNBC-TV18 on the sidelines of The Building Materials Investor Forum, Sheth says what would matter most from a sentiment perspective for another three-six months would be the progress of the monsoon and how it will play out on rural India which is a part of the core constituency that still needs to express its faith in the Modi Sarkar.
02:00pm Market Check
The market extended losses with the Sensex falling more than 100 points and the Nifty breaking 8350 level due to selling in healthcare, banking & financials and oil & gas stocks.
The Sensex declined 132.26 points to 27511.62 and the Nifty dropped 39.70 points to 8330.55. About 1035 shares have advanced, 1485 shares declined, and 164 shares are unchanged on the BSE.
Shares of HDFC, ITC, Tata Motors, ICICI Bank, L&T, Sun Pharma, ONGC, Dr Reddy's Labs and NTPC fell 1-1.6 percent. However, Coal India and GAIL topped the buying list on Sensex, up more than 1.7 percent ahead of fourth quarter earnings this week. TCS, Maruti Suzuki, Hero Motocorp and M&M gained 0.4-1 percent.
Dish TV spiked 6 percent after the DTH service provider surpassed street expectations on every parameter with the fourth quarter profit at Rs 35 crore against loss of Rs 149 crore in the year-ago period. Total income from operations grew by 18.5 percent to Rs 754.7 crore during January-March quarter compared to Rs 636.91 crore in the corresponding quarter of last fiscal.
Meanwhile, the rupee was moving closer to 64 a dollar, down 34 paise to 63.90 a dollar.
1:50 pm Market outlook: The market is unlikely to rise until earnings imporve, Sridhar Sivaram, Founder, Siva Capital Advisor. He expects the market to consolidate for the next six months, even as he believes that a bull run is underway.
Sridhar says China, Korea and Taiwan are now the favourites of investors looking to invest in emerging markets. Also, investors are betting on countries with a positive current account surplus, he says.
According to Sridhar, there has been better clarity on policy over the last year. On the flip side, he feels the government is too focussed on fiscal deficit, and instead should be doing more to boost consumption.
Similarly, he feels the RBI is being too cautious in cutting interest rates.
1:30 pm Buzzing: Shares of Nestle India slipped over 5 percent as its noodles brand Maggie is under scrutiny. Union Food and Consumer Affairs Minister Ram Vilas Paswan has said that the government will review reports about the presence of "higher" level of lead and a food additive in Nestle's Maggi noodles.
"We will review the reports of higher monosodium glutamate (MSG) found in Nestle's Maggi noodles. We will look into the matter and decide on a course of action after the investigation," Paswan said.
The UP FDA had last month asked Nestle India to withdraw a batch of Maggi noodles "which were manufactured in February 2014" after it found high levels of added MSG, a flavour enhancer, in the noodles and lead beyond legal limits.
The market is consolidating on Tuesday. The Sensex is down 51.72 points at 27592.16, and the Nifty is down 16.05 points at 8354.20. About 994 shares have advanced, 1009 shares declined, and 141 shares are unchanged.
GAIL, Hero, M&M, Vedanta and Bharti Airtel are top gainers in the Sensex. Among the losers are Tata Motors, NTPC, Sun Pharma, ONGC and Hindalco are laggards. Tata Motors, BHEL, GAIL and HPCL are expected to announce their March quarter earnings.
Meanwhile in Asian markets, Japanese stocks edged up in a choppy session, with the eighth day of gains underpinned by optimism about the economy's recovery. The Nikkei 225 ended 0.1 percent higher at 20,437.48 after flitting between positive and negative territory during the session.
Although the subdued activity raised the risk of profit-taking, the Nikkei's eight-day gains marked its longest winning streak since last August.
12:58pm Interview: PNC Infratech listed its equity shares on exchanges today. The Agra-based road construction company raised more than Rs 480 crore through the issue with shares oversubscribed 1.54 times.
Speaking to CNBC-TV18, MD Yogesh Jain said around Rs 150 crore will be used for working capital. The order book of the company currently stands at Rs 3,500 crore.
12:40pm Nikkei Update: Japanese stocks edged up in a choppy session today, with the eighth day of gains underpinned by optimism about the economy's recovery.
The Nikkei 225 ended 0.1 percent higher at 20,437.48 after flitting between positive and negative territory during the session.
Although the subdued activity raised the risk of profit-taking, the Nikkei's eight-day gains marked its longest winning streak since last August.
The broader Topix was flat at 1,659.57, with only 1.914 billion shares changing hands, the lowest level in a month.
12:25pm Market Expert: The market is unlikely to rise until earnings imporve, Sridhar Sivaram, Founder, Siva Capital Advisors told CNBC-TV18.
He expects the market to consolidate for the next six months, even as he believes that a bull run is underway.
Sridhar says China, Korea and Taiwan are now the favourites of investors looking to invest in emerging markets. Also, investors are betting on countries with a positive current account surplus, he says.
According to Sridhar, there has been better clarity on policy over the last year. On the flip side, he feels the government is too focussed on fiscal deficit, and instead should be doing more to boost consumption.
Similarly, he feels the RBI is being too cautious in cutting interest rates.
12:00pm Market Check
Equity benchmark and broader indices remained sluggish in noon trade with the Nifty hovering around 8350 level. PNC Infratech fell over a percent at Rs 373.5 against its issue price of Rs 378 on day of listing.
The 30-share BSE Sensex dropped 65.70 points to 27578.18 and the 50-share NSE Nifty declined 18.90 points to 8351.35. About 1072 shares have advanced, 1171 shares declined, and 148 shares are unchanged on the BSE.
As the Narendra Modi government completed one year in office, market experts and India inc remained bullish. Samir Arora of Helios Capital said broad indicators for India are in place while Uday Kotak of Kotak Mahindra Bank said he is happy with all the 'positive' changes by the government.
Tata Motors lost 1 percent ahead of it's fourth quarter earnings. The street expects a largely muted performance because of JLR's product transition phase with consolidated revenue and profit seen up around 3 percent. Margin is expected to be flat at 15 percent.
With more earnings in focus, the street expects a dollar revenue growth of over 7 percent from Tech Mahindra while margin is expected to be impacted due to wage hikes. The stock declined 1 percent.
BHEL too traded with a weak bias. The street expects its fourth quarter numbers to be weak with sales seen lower by 13 percent, margin lower by 250 basis points and profit down by over 50 percent year-on-year.
11:30 am FII view: With the Narendra Modi government completing a year in office today, Indian shares appear to be losing steam with the having turned flat for the year as corporate earnings failed to show any notable signs of pick-up in activity. But noted Singapore-based hedge-fund manager Samir Arora believes the modi government has made a lot of progress, and said as earnings growth picks up in the next few years (which may be more than the 10-12 percent expected by the market, he said) it would take care of the stock market performance. In an interview with CNBC-TV18, who runs Helios Capital, sought to discern the contrasting performance of Indian versus Chinese stocks, which are up about 50 percent in 2015.
The market is still under pressure as the Sensex is down 51.72 points at 27592.16 and the Nifty down 16.05 points at 8354.20. About 994 shares have advanced, 1009 shares declined, and 141 shares are unchanged.
GAIL, Hero, M&M, Vedanta and Bharti Airtel are top gainers in the Sensex. Among the losers are Tata Motors, NTPC, Sun Pharma, ONGC and Hindalco.
Gold was stuck in a tight trading range above USD 1,200 an ounce, as the dollar jumped to a fresh one-month peak against a basket of major currencies on the prospect of higher US interest rates this year.
Bullion was not far off its lowest in about a week. Investors believe higher US interest rates would dent demand for non-interest-paying gold, while boosting the dollar. Bullion's limited trading range in recent sessions, along with Yellen's comments and a robust dollar, could mean the metal will drop, analysts said.
The dollar jumped to a fresh one-month peak, boosted by Yellen's comments and weakness in the euro, which was pressured on worries Greece cannot service debt repayments next month amid a cash crunch. A stronger dollar makes gold more expensive for holders of other currencies, and also diminishes its safe-haven appeal.
10:58am Market Update: The Sensex declined 49.94 points to 27593.94 and the Nifty fell 15.50 points to 8354.75.
About 995 shares have advanced, 1005 shares declined, and 138 shares are unchanged on the BSE.
10:40am Interview: VRL Logistics expects a double-digit revenue growth this year. In an interview to CNBC-TV18, Sunil Nalavadi, chief financial officer, VRL Logistics says stagnant fuel and freight prices drove goods transport business.
He expects to maintain margins and topline growth in FY16, by expanding passenger business with a national permit.
10:20am FII View on earnings: Bhuvnesh Singh, Barclays said with one week to go before the end of the earnings season and 60 of the BSE 100 companies having reported their quarterly earnings thus far, the EPS 'beats' and 'misses' stand at 20/60 (33 percent) and 28/60 (47 percent) respectively.
Most 'misses' thus far have been reported in consumer discretionary, IT, healthcare and materials sectors while industrials have had the highest 'beats', he added.
According to him, the Reuters consensus FY16 EPS growth estimate now stands at 19.7 percent although the absolute EPS number for FY16 has seen a 270 bps downward revision since the start of the earnings season on April 1. All sectors have seen downward revisions to their FY16 earnings estimates, said Singh.
10:00am Market Check
The market remained under pressure amid consolidation with the Nifty holding 8350 level. FMCG, oil & gas, auto, capital goods and private banks stocks saw selling pressure while select technology, metals and telecom stocks gained.
The Sensex fell 46.39 points to 27597.49 and the Nifty declined 12.35 points to 8357.90. About 890 shares have advanced, 770 shares declined, and 129 shares are unchanged on the BSE.
Tata Motors and BHEL declined 1 percent each ahead of fourth quarter earnings today. A CNBC-TV18 poll expects BHEL's net sales to come in lower by 12.9 percent at Rs 12,854 crore while PAT is expected to come down 57.5 percent at Rs 783 crore.
Tata Motors's consolidated numbers are expected to be a muted because of JLR's product transition phase while standalone business (domestic) is seen some improvement during the quarter due to rebound in passenger vehicle and medium & heavy commercial vehicle sales.
Tech Mahindra also fell over 2 percent ahead of numbers. A CNBC-TV18 poll expects dollar revenue to come in higher by 7.7 percent at USD 996 million but PAT may take a hit of 11.4 percent to Rs 713 crore as its margins are expected to contract 260 basis points.
ITC remained under pressure for the second day, down nearly 1 percent. Sun Pharma, ICICI Bank, L&T, ONGC, HUL and Wipro declined 0.5-1 percent while Infosys, SBI, Bharti Airtel, M&M, Hero Motocorp, Vedanta and Coal India gained 0.5-1.5 percent.
9:45 am Market outlook: The March quarter earnings season was a disappointment and a cyclical recovery will be seen only from the third quarter of this year, says Anish Damania Head-Institutional Equities, IDFC Securities, in an interview to CNBC-TV18. "There are pockets of recovery, but not well spread. It will take another two or three quarters for a broad-based recovery," he says. He expects the Nifty to be rangebound between 7900-8500 over the next couple of quarters and says better than expected earnings growth will be key to the Nifty testing the record highs seen in March this year. He expects the earnings growth to pick up from the third quarter onwards partly because of the low base effect.
9:30 am Result Poll: Tata Motors will announce its fourth quarter earnings on May 26. Consolidated numbers are expected to be a muted because of JLR's product transition phase while standalone business (domestic) is seen some improvement during the quarter due to rebound in passenger vehicle and medium & heavy commercial vehicle sales. Consolidated profit after tax may increase 2.85 percent year-on-year to Rs 4,030 crore and revenue is seen rising 3.2 percent to Rs 67,446 crore during January-March quarter, according to a CNBC-TV18 poll.
The market has opened flat as the Sensex is down 13.63 points at 27630.25. The Nifty is up 7.40 points at 8377.65. About 274 shares have advanced, 151 shares declined, and 69 shares are unchanged.
SBI, Wipro, Vedanta, Hero and GAIL are top gainers in the Sensex. Among the losers are HDFC, BHEL, Axis Bank, NTPC and Sun Pharma.
The Indian rupee has started trade with marginal loss. The currency has opened at 63.60 a dollar, down 4 paise compared to 63.56 a dollar in previous session.
The dollar hit a one-month high against a basket of major currencies on Monday in the wake of Friday's comments from Federal Reserve Chair Janet Yellen, who rekindled market expectations that the central bank was gearing up to hike interest rates.
Ashutosh Raina, HDFC Bank said the dollar index has again started moving higher after recent comments from Fed officials about likely beginning of the rate hike cycle later this year. The market will be keenly watching the US data for further clues, he added.
According to him, the rupee continues to trade in the 63.50-64.00/USD range with intervention capping any further gains. He expects the pair to trade in 63.30-63.80/USD range today.
Asian shares fell in early trading, while the dollar held near highs scaled in holiday-thinned trading in the previous session. European shares marked a weak finish in thin trade on Monday, with many markets in the region
Investors await the latest batch of US data later today that could provide more clues on the strength of economic recovery, including May durable goods and April consumer confidence.