Sensex falls 1%, Nifty ends at 7979; ITC, Tata Motors outperform
22 Dec 2016
3:30 pm Market closing: Equity benchmarks extended losses for the seventh consecutive session today, falling 1 percent weighed by banking & financials, infra, oil and metals stocks.
The Sensex plunged 262.78 points to 25979.60 and the Nifty fell 82.20 points to 7979.10. About 1978 shares declined against 665 advancing shares on the BSE.
The broader markets underperformed benchmarks with the BSE Midcap and Smallcap indices declining 1.5 percent and 1.25 percent, respectively.
3:08 pm Market Update: Equity benchmarks extended losses in late trade with the Sensex falling 293.19 points or 1.12 percent to 25949.19 and the Nifty down 89 points or 1.10 percent at 7972.30.
About 2000 shares declined against 566 advancing shares on the BSE.
3:03 pm Buzzing: Phoenix Mills shares spiked nearly 6 percent intraday after the Canada Pension Fund signed non-binding term sheet to buy 49 percent stake in a subsidiary of the company.
"Island Star Mall Developers Private Limited (ISML), the wholly owned subsidiary of the company, has entered into a non-binding term sheet with Canada Pension Plan Investment Board, on the basis of which the proposed investor may over a (3-year) period acquire up to 49 percent stake in ISML," the company said in its filing.
The transaction is subject to execution of definitive agreements by the parties and fulfillment of conditions as may be applicable from time to time.
The funds raised by ISML will be utilised for business development and growth purposes.
2:54 pm Kotak on cement demand: Cement volumes have been impacted to the extent of 30-40 percent in trade segment post demonetisation on account of large proportion of trade sales being held in cash.
Some of the sales volumes during November were also led by pending projects but December was weaker than November for most of the regions (barring south). Out of the key drivers of cement demand, rural segment was impacted adversely due to liquidity issues while real estate segment is likely to face a prolonged slowdown, Kotak feels.
Individual housing segment is impacted for short term due to cash crunch while demand from government infrastructure projects continued to aid volume growth.
Kotak expects demand from rural and individual housing segment to bounce back quickly once liquidity eases into the system while builder segment is expected to witness slowdown for few more quarters before lower prices start to drive demand up.
2:45 pm Nomura economic outlook: India's economy is in transition: towards greater formalisation, lesser corruption, better infrastructure and improved governance, says Nomura.
Some of these transitional reforms – the recent demonetisation and implementation of the goods and services tax (GST) – along with a reversal of the terms-of-trade gains will hurt growth in the near term but are laying the ground for a faster growth rebound in 2018, it feels.
The brokerage firm expects growth to be largely unchanged at 7.1 percent in 2017, but to rise sharply to 7.7 percent in 2018.
2:33 pm Investments via P-notes fall: Investments in domestic capital markets through participatory notes (P-Notes) plunged to its lowest level in nearly three years to Rs 1.79 lakh crore in end-November.
P-Notes are typical instruments issued by registered foreign portfolio investors (FPIs) to overseas investors who wish to participate in Indian markets without registering themselves directly in the country to save time. But they still need to go through a proper due diligence process.
According to the data available with Sebi, the total value of P-Notes investment in Indian markets -- equity, debt and derivatives -- fell to Rs 1,79,648 crore in November-end, from Rs 1,99,987 crore at the end of October.
This was the lowest level since February 2014 when the cumulative value of such investments stood at Rs 1,72,738 crore.
The investment through the route was Rs 2,12,509 crore, Rs 2,16,232 crore and Rs 2,12,179 crore at the end of September, August and July, respectively.
2:20 pm Expert: Madhu Kela of Reliance Capital said that pain from demonetisation is coming down. Queues are coming down in banks, he said, adding that he sees the situation getting stabilised by January end.
Valuations have corrected a bit, he said, in largecap companies owing to a lot of selling by FIIs. Domestic institutions are buying, he said.
2:00 pm Market Check
Benchmark indices continued to reel under selling pressure, falling around a percent amid thin volumes ahead of Christmas holiday. Technology, banking & financials, oil, infra and metals stocks led the market lower.
The 30-share BSE Sensex slipped 242.34 points to 26000.04 and the 50-share NSE Nifty fell 80.20 points to 7981.10. The BSE Midcap and Smallcap indices were down 1.4 percent and 1.2 percent, respectively. About four shares declined for every share rising on the BSE.
European markets were lower as trading desks began to thin out on the last full day of work for London's financial sector before the long Christmas break.
Adani Ports, ONGC, Tata Steel and Bharti Airtel were the biggest losers among Sensex 30 stocks, down 3-4 percent followed by Infosys, HDFC, L&T, SBI, Axis Bank and Maruti Suzuki while ITC, Wipro and TCS gained.
1:29 pm Buzzing: Shares of SPARC, the subsidiary of healthcare major Sun Pharma, surged nearly 7 percent intraday Thursday after receiving complete response letter from the US health regulator for preservative-free eye drop.
"...has received a complete reponse letter from the US Food and Drug Administration for the new drug application for Xelpros, Latanoprost BAK-free eyedrops," the research company said in its filing.
It further said the complete response letter was related to the recent inspection of the Sun Pharma's Halol manufacturing facility (in Gujarat) by the USFDA and indicated that satisfactory resolution of the deficiencies identified during the inspection is required before the final approval of Xelpros.
In the complete response letter, the US FDA has not asked for any additional data.
1:15 pm Interview: Diagnostics company Thyrocare Technologies felt the blow of demonetisation in the month of November but was back on its feet and saw growth at 24 percent in the month under review.
A Velumani, the company's chief said that Thyrocare should see a sales growth of 25 percent, with a variation of 2 percent in the third quarter.
He also mentioned that the fourth quarter is the strongest quarter for the company.
1:00 pm Market Check
Equity benchmarks plunged further in afternoon trade with the Sensex shedding 250 points on broadbased selling. Analysts expect the market to correct more from here on, citing likely disappointing December quarter earnings, sales data and economic data. Also they are cautious ahead of US president-elect Donald Trump's policy that will be announced in next month.
The market is down 10 percent on both local and global factors and has faced two shocks - US Fed hike and demonetisation, says Madhav Dhar of GTI Capital. He expects it to fall another 5 percent.
He says the market has factored in 75 percent of all the negative news and needs to watch for troublesome events in the global economy.
The 30-share BSE Sensex was down 252.54 points or 0.96 percent at 25989.84 and the 50-share NSE Nifty dropped 81.85 points or 1.02 percent to 7979.45. The market breadth weakened further; about four shares declined for every share rising on the BSE.
12:48 pm M&A deals in 2016: Corporate boardrooms remained abuzz with deal activities in 2016 with mergers and acquisitions worth over USD 52-billion and the tally may get even bigger in the new year on growing interest of global investors in the Indian businesses.
The surge in deal value this year was largely driven by big-ticket transactions and consolidation in many sectors, experts said, while adding that similar trends may continue going forward in 2017.
They said the new year looks promising in terms of domestic, inbound as well as outbound deals, but this outlook is dependent on macro-economic trends and reforms in sectors like infrastructure and power among others.
According to consultancy major EY, the total quantum of announced deal value for 2016 is estimated at USD 52.6 billion, sharply higher than USD 31.3 billion in 2015, though the deal count declined to 756 deals (from 886 deals in 2015).
12:35 pm Market Expert: "There is an old saying, 'you should either give them a price or give them a time but not both,'" says Madhav Dhar when asked about how the market will exactly fare in 2017.
We are down 10 percent on both local and global factors and have faced two shocks - US Fed hike and demonetisation, says Madhav Dhar of GTI Capital.
Listing his views for the year ahead Dhar told CNBC-TV18 that the market may see another 5 percent fall and another month of time correction.
12:24 pm Interview: Biocon is among the companies that gave a good performance in 2016 and the stock surged 80 percent this year.
Speaking to CNBC-TV18, Kiran Mazumdar Shaw, CMD of the company, said the Japanese regulatory approval for insulin glargine was the starting point and after that the company did many filings both in EU and US.
Company has filed Glargine, Pegfilgrastim, Trastuzumab in EU and US.
The most important thing is to get one approval in EU for one of these filings, said Mazumdar.
She also said that speciality is the way to go and Biocon believes that there will be better returns if a company focuses on specialty. Biocon will file insulin Glargine in the US in FY18.
12:00 pm Market Check
The market remained under pressure in noon trade, heading towards its seventh straight session of losses. Nifty Metal hit hardest, falling over 2 percent followed by Bank index that dropped a percent.
The 30-share BSE Sensex was down 217.59 points at 26024.79 and the 50-share NSE Nifty plunged 71.80 points to 7989.50. The broader markets fell over a percent as declines increased further.
About 1827 shares declined against 478 advancing shares on the BSE.
Tata Steel and Hindalco Industries were the biggest losers among Nifty 50 stocks, down 3 percent each. Infosys, HDFC, SBI, L&T, ONGC, Axis Bank and Maruti Suzuki were down 1-2 percent.
Equity market seems to be caught in a global trend where there is a risk-off trade happening and emerging markets are seeing a sell-off, says market analyst, Rakesh Arora.
Domestically, exaggerated fears of demonetisation, uncertainty about Q3, Q4 earnings outlook is also keeping the market on tenterhooks, he adds. He believes, it is likely that the market is 2-5 percent away from the bottom, so it is right time to start buying.
11:25 am Interview: Demonetisation has taken a toll on consumer durable industry, says Pradeep Bakshi of Voltas.
He further said that the impact of demonetisation has been higher in the month of December. However, demand in select regions is down 50 percent, he added.
Speaking to CNBC-TV18, he said that rise in commodity prices is also likely to impact the business.
Voltas is seeing a slowdown in AC business in both rural and urban areas, said Bakshi.
However, we have offered a lot of discounts and schemes to customers, he added.
11:00 am Market Check: The selling pressure continued for the seventh consecutive session today due to lack of positive triggers. The market may be factoring in the impact of demonetisation on December quarter earnings, December sales data and economic data that will be announced next month.
Udayan Mukherjee says he doesn't see what could be a correct bottom for the market but strategy should be to keep buying stocks at average prices and be patient. He stressed that it is a phase of opportunity.
The next 3 months is going to throw up a lot of opportunities for buying, he believes. "One needs to be opportunistic. The market is going through a painful phase and it is not over. It is only getting entrenched," he says.
The 30-share BSE Sensex fell 177.53 points to 26064.85 and the 50-share NSE Nifty dropped 59.40 points to 8001.90 while the broader markets continued to underperform, falling more than a percent on weak breadth. The Nifty Midcap breached the 200-DMA.
About three shares declined for every share rising on the BSE.
SPARC shares gained 4 percent after receiving a complete response letter (CRL) from USFDA for their new drug application (NDA) on Xelpros, which is an eye drop.
10:40 am Market Update: The market turned negative for the 2016 after the Nifty broke 8000 level for the first time since November 25, down 68.15 points to 7993.15.
The Sensex was down 206.77 points at 26035.61. About 1538 shares declined against 466 advancing shares on the BSE.
10:35 am New scheme to scrap CV: Sources tell CNBC-TV18 that the government is proposing a scheme where owners of commercial vehicles of over 15 years old should be given a chance to scrap their vehicles. The government is preparing a final note to be sent to the committee of secretaries regarding this move.
A part of the scheme envisages original equipment manufacturers giving incentives to owners who are keen to scrap their over 15-year-old vehicles. Once a final policy is thrashed out and introduced, the voluntary scheme will be rolled back.
10:20 am Market Expert: The recent fall in equity markets has made SIP an attractive investment opportunity but there are lots of events lined up in the first half – Demonetisation impact, Union Budget, earnings, how US pans out etc, Ashish Somaiyaa, MD & CEO, Motilal Oswal AMC says.
Demonetisation could lead to a shift from unorganised market to organised market.
Talking about consumption as a theme he said although luxury market will take a hit due to demonetisation, non-discretionary spending will be back in the next 6-8 months.
People will prefer to invest in equities now, believes Somaiya.
10:00 am Market Check
Benchmark indices extended losses in morning trade with the Sensex falling nearly 200 points, weighed by banking & financials, technology, infra and oil stocks.
The broader markets underperformed benchmarks with the BSE Midcap and Smallcap indices losing 0.9 percent and 0.8 percent, respectively on weak breadth. About three shares declined for every share rising on the exchange.
The 30-share BSE Sensex was down 180.65 points at 26061.73 and the 50-share NSE Nifty fell 58.25 points to 8003.05.
Fall in global peers also weighed on sentiment. Asian shares lost ground amid thinner pre-holiday trade, after the Dow failed to reach the 20,000 mark overnight.
Leading markets like Japan's Nikkei, China's Shanghai and Hong Kong's Hang Seng were down 0.2-0.9 percent.
HDFC, HDFC Bank, L&T, TCS and Axis Bank were top five contributors to Sensex's fall, down 0.5-1.7 percent followed by SBI, Adani Ports, ICICI Bank and Maruti.
However, Hindustan Unilever, Sun Pharma, Hero Motocorp, Tata Motors and Bajaj Auto bucked the trend.
9:40 am GST meet: The GST Council will begin its two-day meeting today to consider the model GST laws and iron out differences on the vexed issue of jurisdiction over assessees in the new indirect tax regime.
This will be the seventh meeting of the Council, which is headed by Union Finance Minister Arun Jaitley and has state ministers as members.
With as many as 20 chapters of the model GST law cleared in its last meeting earlier this month, the Council will tomorrow discuss the remaining 7 chapters and then on Friday take up the dual control issue.
As consensus eluded the Council meeting, the subsequent GST legislations -- CGST, IGST and compensation law -- could not be introduced in the Winter session of Parliament that ended last week. This has threatened the April 2017 rollout target of the Goods and Services Tax (GST).
9:25 am Goldman on Voltas: Goldman Sachs has maintained neutral call with no near-term catalysts for Voltas to re-rate but remained constructive on long-term growth potential.
The brokerage house expects unitary cooling products sales to decline by 10 percent YoY in the first half of financial year 2017-18 and increase 10 percent YoY for FY18.. It also expects EPS for FY17/18 at Rs 10.50/13.30.
Goldman says uncertainty post demonetisation continues and there is no near-term catalyst. Demonetisation could change the spending patterns, it feels.
Domestic business margin may remain soft in near-term and increase gradually from FY18/19.
Management did not quantify near-term impact of demonetisation on AC sales and expects impact of demonetisation on AC sales to be minimal.
The brokerage says muted outlook for real estate could likely impact sales of associated products.
9:15 am Market Check
Equity benchmarks fell further in early trade with the Nifty breaking 8050 level, weighed by banks and weak Asian cues.
The 30-share BSE Sensex was down 57.73 points at 26184.65 and the 50-share NSE Nifty declined 17.10 points to 8044.20.
Sun Pharma gained more than 1 percent after the company acquired oncology product Odomzo from Novartis for global markets. It will make upfront payment of USD 175 million and additional milestone payments for the product.
In addition, its Sun Pharma Advanced Research Company has received complete response letter from US FDA for Xelpros that indicates resolution of deficiency identified in Halol inspection.
HDFC, ITC, Maruti Suzuki, ICICI Bank, Axis Bank, ONGC and Asian Paints were down 0.5-1 percent while Tata Motors, TCS, Infosys, Wipro and Tata Steel gained.
The Indian rupee continued its recovery on Thursday for the second consecutive session following correction in dollar. It has opened higher by 8 paise at 67.83 per dollar against previous close of 67.91.
Tirthankar Patnaik of Mizuho Bank says he expects the rupee to range between 67.50-68.50/dollar over the next two weeks as the market remains quiet towards the end of the year and selling pressure from foreign investors eases.
The rupee would come under renewed pressure in the new year based on macro performance in the wake of demonetisation, he says.
The dollar index retreated after hitting its highest since December 2002. Meanwhile the Swedish Crown gained 1.4 percent against the dollar after Sweden's Central Bank narrowly voted to add to its bond-buying program.
Asian markets were mixed today amid thinner pre-holiday trade, after the Dow failed to reach the 20,000 mark overnight. Japanese benchmark Nikkei 225 fell 0.2 percent.
US stocks fell on Wednesday, with healthcare and real estate shares losing ground a day after the Nasdaq Composite and the Dow Jones Industrial Average hit record highs.