Sensex ends above 39,000, Nifty below 11,600; YES Bank jumps 8%

25 Oct 2019

Technical View: Nifty remained below 11,600 and formed bearish candle on daily charts as closing was lower than opening value. It lost 0.7 percent for the week and formed bearish candle on weekly charts as well.

Experts expect the sharp correction only if the index decisively breaks 11,500 levels, till then traders can remain cautiously optimistic on the market.

"Despite the visible weakness of the last four sessions, Nifty50 appears to be attracting buying interest on dips, at least as of now. Unless Nifty sharply corrects below 11,500 levels traders can remain cautiously optimistic and look for stock-specific opportunities," Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.

He said more clarity on index shall arise once Nifty registers a close above 11,700 levels. In such a scenario initial targets shall be in the zone of 11,770–11,790, he added.

Marico Q2 profit jumps 17%

Marico has registered 17 percent jump in its Q2 consolidated net profit at Rs 253 crore against profit of Rs 216 crore in a year ago period. Revenue of the company was down marginally at Rs 1,829 crore against Rs 1,837 crore.

Earnings before interest, tax, depreciation and amortization (EBITDA) up 15.7 percent at Rs 353 crore versus Rs 305 crore, while EBITDA margin rose 270 bps at 19.3 percent.

The board declared interim dividend of 275 percent at Rs 2.75 per equity share for FY 2019-20.

ICICI Bank shares hit record high ahead of Q2 earnings

Shares of ICICI Bank rallied 3.5 percent intraday to hit a record high of Rs 470.70 on October 25. Its September quarter earnings are scheduled to be announced on October 26. Healthy quarterly numbers by SBI also lifted sentiment.

According to brokerage houses, the country's second largest lender, on October 26, is expected to report healthy earnings growth in the July-September quarter with reduction in non-performing loans and fresh slippages.

Zuari Agro Chemicals gains 7% on biz restructuring

Shares of Zuari Agro Chemicals rose 7 percent intraday on October 25 after company board approved the restructuring of the businesses. The company board at its meeting held on October 25 approved the proposal to restructure its fertilizer business with a view to monetize and consolidate all its bulk fertilizer operations.

“It has decided to incorporate another company, under the name of “Zuari FarmHub Limited”, which will operate its retail, speciality nutrients and the proposed FarmHub business, for which the company is also seeking investments from Strategic and /or Financial Investor’s,” company said in the release.

Market update: The market is currently in the green, backed by gains in select bank, IT and FMCG majors such as SBI, TCS, Infosys, Hindustan Unilever and ITC. However, losses in shares of HDFC twins, Kotak Mahindra Bank and Reliance Industries are keeping the gains capped.

SBI Q2 profit jumps 3-fold to Rs 3,012 cr despite higher provisions, fresh slippages dip sharply

State Bank of India reported more than 3-fold increase year-on-year in second quarter profit despite higher provisions, with improvement in asset quality. Profit increased to Rs 3,012 crore compared to Rs 944.87 crore in same period last year.

Asset quality improved sequentially as well as year-on-year. Gross non-performing assets (NPA) as a percentage of gross advances fell 34bps QoQ to 7.19 percent and net NPAs dropped 28bps QoQ to 2.79 percent in quarter ended September 2019.

Arvind shares jump 4% after Q2 earnings

Shares of textiles firm Arvind jumped 4 percent on BSE on October 25 after the company posted a 9 percent top-line growth for the September quarter of FY20.

However, the company's consolidated net profit declined 20 percent YoY to Rs 48 crore in Q2FY20 from Rs 60 crore in the corresponding quarter of the previous financial year.

EBITDA came 7 percent higher at Rs 195 crore in Q2FY20 against 182.3 crore in Q2FY19 while EBITDA margin declined by 30bps to 9.9 percent against 10.2 percent in the previous financial year.

Tata Motors shares fall 4% ahead of Q2 earnings

Shares of Tata Motors fell more than 4 percent on BSE on October 25 ahead of the automaker's September quarter earnings.

Brokerages feel the company may continue to report a loss in the quarter ended in September year-on-year (YoY), dented by weak business in India. But, sequentially, the performance may be better due to improvement at Jaguar Land Rover (JLR).

According to brokerages, the consolidated loss could be in the range of Rs 800-1,500 crore for the September quarter against a loss of Rs 1,048.8 crore in the year-ago period but could be far lower than the loss of Rs 3,680 crore in the June quarter.

Kaya plunges nearly 7% after net loss widens in Q2

Shares of Kaya plunged nearly 7 percent intraday on October 25 after the company's net loss had increased in the quarter ended September 2019 (Q2FY20).

The company's Q2 net loss has widened to Rs 9.3 crore against loss of Rs 1.5 crore, reported in a year ago period. The revenue of the company was down 5.5 percent at Rs 101.5 crore against Rs 107.4 crore.

SBI gains 3% ahead of September quarter earnings

Shares of State Bank of India gained 3.4 percent intraday on October 25 ahead of likely fall in slippages in quarter ended September 2019. Earnings will be announced later today.

The stock lost more than 20 percent in last three months. It was quoting at Rs 269.90, up Rs 7.20, or 2.74 percent on the BSE at 1222 hours IST.

Profit is expected to be at around Rs 1,875.9 crore in September quarter, rising 98.5 percent compared to year-ago but may decline 20 percent sequentially due to deferred tax assets adjustment, according to a poll analysts conducted by CNBC-TV18.

DHFL shares locked in 5% lower price band

Shares of Dewan Housing Finance Corporation (DHFL) remained locked in the 5 percent lower price band at Rs 17.55 on BSE on October 25 and looked on course to extend their losing run into the fourth straight session.

The stock remained in the red even as it clarified in a BSE filing that it has taken cognizance of the key observations from the draft report prepared by KPMG.

"The company reiterates that it has taken cognizance of the key observations from the draft report prepared by KPMG, appointed by Union Bank of India, the lead banker of the consortium, on behalf of all the members of the consortium," DHFL said in a regulatory filing.

IndiGo operator shares tank 10% after loss widens

InterGlobe Aviation, the operator of low cost airline IndiGo, fell 10 percent intraday on October 25 after the loss widened and margin contracted in quarter ended September 2019.

InterGlobe reported a loss of Rs 1,062 crore for quarter ended September 2019, which was much higher than analyst expectations and widened compared to loss of Rs 651 crore in year-ago period.

Global brokerage house Morgan Stanley had expected loss of Rs 290 crore for the quarter.

Colgate slips 2% even as Credit Suisse raises target price

Colgate Palmolive (India) declined over 2 percent on BSE on October 25, even as the company, a day before, had reported its September quarter earnings which was broadly in-line with the expectations. Foreign financial firm Credit Suisse has maintained 'outperform' call on the stock and raised the target price to Rs 1,725 from Rs 1,660.

The company said its profit after tax stood at Rs 244.1 crore aided by corporate tax cut while revenue stood at Rs 1,221.8 crore in the September quarter of FY20.

IDFC First Bank climbs 8% on improvement in Q2 asset quality

IDFC First Bank rallied 8 percent intraday on October 25 following the improvement in second quarter asset quality sequentially, though net loss widened QoQ as well as YoY.

The bank posted a loss of Rs 679.50 crore in quarter ended September 2019, against loss of Rs 617.35 crore in April-June period. The loss for year ago period stood at Rs 369.6 crore, but it was not comparable as it was pre-merger period.

The loss reported during the quarter was because of one-time tax impact of Rs 751 crore due to markdown of existing deferred tax assets, the lender said its BSE filing.

United Spirits jumps 4% as Q2 margin beats estimates

Shares of United Spirits gained 4 percent intraday on October 25 after the September quarter margin beat analyst estimates, but global brokerages retained neutral stance on the stock.

The liquor-maker’s profit fell 13 percent year-on-year to Rs 225 crore in the September quarter on account of weak operating income and tepid revenue growth of 3 percent.

Jewellery stocks trade mixed on Dhanteras; Titan hits 52-week high

Shares of diamond and jewellery companies traded mixed on October 25 on the day of Dhanteras festival. Shares of Titan Company climbed over a percent to touch their fresh 52-week high at Rs 1,389.85 on BSE.

Some other diamond and jewellery stocks such as Atlas Jewellery and Rajesh Exports also climbed up to 2 percent. However, shares of Thangamayil Jewellery, PC Jeweller, Tribhovandas Bhimji Zaveri and Uday Jewellery Industries plunged up to 5 percent.

Tata Motors may post loss again in Q2 on weak India biz YoY

Tata Motors is likely to continue to report loss in the quarter ended in September year-on-year (YoY), dented by weak business in India. But, sequentially, the performance may be better due to improvement at Jaguar Land Rover level.

According to brokerages, the consolidated loss could be in the range of Rs 800-1,500 crore for September quarter against loss of Rs 1,048.8 crore in the year-ago period but could be far lower than loss of Rs 3,680 crore reported in the June quarter.

PNB Housing Finance gains 13% on good Q2 numbers

Shares of PNB Housing Finance gained 13 percent intraday on October 25 after the company reported better-than-expected numbers in the September quarter. The company saw a 45 percent jump in its Q2 net profit at Rs 366.8 crore against Rs 253 crore in the same quarter last year.

Net interest income (NII) was up 36 percent at Rs 628.4 crore versus Rs 462.8 crore, YoY.

Buzzing stock: Havells India fell over 2 percent in early trade on BSE on October 25 after global brokerage firm CLSA downgraded the stock to 'outperform' from 'buy' and cut the target price by 7.23 percent to Rs 770 from Rs 830.

The competitive intensity in LED panels was a major reason for a sharp drop in the margins of Lloyd, CLSA said.

Jefferies, however, has maintained a 'buy' call on Havells, with a target price of Rs 845 and said Lloyd revamp was in progress.

Market update: In line with benchmark Sensex, the BSE Midcap and Smallcap indices were flat around 09:25 hours IST. Among the sectoral indices, BSE Telecom cracked about 3 percent on losses in shares of Bharti Infratel, Bharti Airtel, Vodafone Idea and Sterlite Technologies.

Market update: Around 09:20 hours IST, BSE Sensex was 46 points up at 39,066, while Nifty was flat at 11,581. ITC, State Bank of India and Infosys were the top gainers in the Sensex index, whereas Tech Mahindra, ONGC and Vedanta were the top losers.

Rupee update: The Indian rupee opened at 71.04 per dollar on Friday against the previous close of 71.02.

On October 24, the rupee snapped its five-day winning streak to finish 11 paise lower at 71.02 against the US dollar, weighed by unabated foreign fund outflows and a weak trend in domestic equity markets.

NSE surveillance measures: The NSE has released surveillance measures with respect to the companies with high promoter pledge, CNBC TV18 reported. The exchange will levy a minimum margin of 35 percent if the promoter pledge is more than 25 percent of total shares. Besides, NSE will levy a minimum margin of 35 percent on the stocks with market-capitalisation of over Rs 1,000 crore.

Moreover, NSE has decided to levy a 30 percent margin if the concentration of the top 25 clients is 30 percent or more in one month or if high-low price variation in 3 months is more than 40 percent.

The surveillance measures will be effective from November 01, 2019.

Results on October 25: Tata Motors, SBI, Marico, HDFC Asset Management Company, Arvind, Hikal, Infibeam Avenues, Jubilant Life Sciences, Reliance Capital, Ratnamani Metals, Strides Pharma Science, Supreme Industries, Tata Coffee, V2 Retail and Zuari Agro Chemicals are among the companies that will release their September quarter scorecards today.

Oil update: Oil prices stepped back on Friday after three straight days of gains, hurt by renewed concerns about fuel demand in light of gloomy economic growth forecasts. Brent crude was down 30 cents, or 0.5 percent, at $61.37 by 0122 GMT, reported Reuters. The global benchmark rose nearly 1 percent on Thursday and is heading for a weekly gain of more than 3 percent.

Gold update: Gold rose to a fresh two-week high on Friday, as weak US economic data spurred expectations for another interest rate cut by the Federal Reserve later this month. For the week, the metal has gained 0.8 percent so far. US gold futures were flat at $1,504.40 per ounce on Friday, reported Reuters.

Asian markets update: Asian shares inched up on Friday, tracking small gains in world markets as positive earnings offset economic growth concerns, while sterling weakened as the prospect of a UK election added fresh uncertainty to Brexit dramas, reported Reuters.

In early trade in Asia, MSCI's broadest index of Asia-Pacific shares outside Japan was 0.13 percent higher.

US markets update: The S&P 500 and the Nasdaq rose on Thursday following strong quarterly reports from several technology companies, including Microsoft Corp, but dour results from 3M Co stymied the Dow Jones Industrial Average, reported Reuters.

Microsoft shares gained 2 percent as the tech giant's outlook for cloud computing services surpassed analysts' expectations, while shares of PayPal Holdings Inc rose 8.6 percent on the payments company's strong full-year earnings forecast. Microsoft and PayPal were the top boosts to the S&P 500 and the Nasdaq.