Sensex falls 189 points on weak global cues
28 Aug 2019
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Rupee Closing
The Indian rupee ended at 71.77 against the US dollar, down by 29 paise compared to previous close of 71.48 a dollar.
"Nifty50 managed to hold above 11,000 levels after taking small dip making it as strong support for coming session followed by 11,940 zone and resistance for index is coming near 11,100-11,150 zone," Rohit Singre, Senior Technical Analyst at LKP Securities told Moneycontrol.
He said Nifty bank has given closing at 27,804 with loss of 322 points forming bearish candle on daily chart now support for Nifty bank is coming near 27,500-27,250 zone and resistance is coming near 28,000-28,250 levels."
Stocks Update
Of Sensex 30, 23 stocks ended lower including Yes Bank, Tata Steel, Vedanta, ONGC, Tata Motors, Maruti Suzuki, NTPC, M&M and Hero MotoCorp which corrected 2-7 percent.
HCL Technologies, Infosys, Tech Mahindra and HDFC bucked the trend.
Market Snaps 3-Day Gains:
Benchmark indices snapped three-day gains amid global recession fears. The BSE Sensex was down 189.43 points at 37,451.84 and the Nifty50 fell 59.30 points to 11,046.10.
In the broader space, Edelweiss Financial, Oberoi Realty, Tata Global and ICICI Prudential rallied 5-10 percent.? RBL Bank plunged 12 percent.
Coffee Day's AGM Postpones
Coffee Day Enterprises said it has got approval from Registrar of Companies, for extension of Annual General Meeting for the Financial year ended March 31, 2019 which is due to be held on or before September 30, 2019, for another period of 45 days.
RBL Bank's Clarification on transactions by employees in shares
"Bank is a professionally managed entity, wherein ESOPS are an important component of employee value proposition. The total employee holding in bank is 3.46 crore shares (as at August 23) with over 25 percent of employees holding shares," the private sector lender said in its BSE filing.
Market transactions in bank shares by employees is routine activity with regular exercise of ESOPs & sale of equity shares thereafter. ESOPs exercised & sale of equity shares by employees for month of July,2019 is in line with past, it added.
The bank said no Management Committee member including KMP have sold any shares on July 30, 2019 and thereafter till date.
Weekly Derivatives Strategy
"Nifty has been consolidating in the range of 10,700-11,200 since the past few weeks. 11,200 acts as a very strong resistance and crossing the same is critical for the index to resume its uptrend. On the downside breach of 10,800 is expected to infuse further selling pressure," Sahaj Agarwal, Head of Derivatives, Kotak Securities told Moneycontrol,
He said long aggression is advisable only above 11,200 else he expects selling pressure to push the markets lower. IT stocks and select private banks remain strong while weakness continues in the midcap space, he added.
Kalpataru Power plunges 12%
Shares of Kalpataru Power Transmission plunged more than 12 percent intraday on August 28 after the company said that the World Bank had issued it a notice over alleged irregularities in its Africa business.
In a BSE filling, the company said the World Bank had alleged process violations in the bids it submitted for two projects. The World Bank is providing funds for the works.
Reason for Sell-Off
Ajay Srivastava of Dimensions Corporate Financial Services told CNBC-TV18 that today’s sell-off is partly led by global developments.
"Domestic investors are neither selling nor buying, it's all FII activity. Advice is to sit tight for now," he said.
Capital Alliance Agreement
Toyota and Suzuki entered into capital alliance agreement. Accordingly, Toyota plans to acquire 4.9 percent stake in Suzuki worth 96 billion yen and Suzuki plans to acquire stake in Toyota worth 48 billion yen. (Source: CNBC-TV18)
Indian Oil Corp plans $28 billion investment by 2023-24
Indian Oil Corporation, the country's top refiner, plans to invest Rs 2 lakh crore ($27.98 billion) in five-seven years to meet energy needs of diverse user groups, Chairman Sanjiv Singh told a shareholders meeting.
IOC through its 11 refineries controls about a third of India's 5 million-barrel-per-day (bpd) refining capacity.
Singh said the investment was required to help IOC "evolve into a future ready corporate that provides comprehensive energy solutions to diverse user groups".(Source: Reuters).
Stocks At 52-week High
Nestle India, ICICI Prudential Life Insurance Company, HDFC Asset Management Company, Petronet LNG, Apollo Hospitals Enterprises, Bata India, Tata Global Beverage and Reliance Nippon Life Asset Management among others hit 52-week high today.
ICICI direct on Brigade Enterprises
Brigade Enterprises (BEL) made an announcement on bonus shares on July 15, 2019. The ratio was one bonus share for every two equity shares i.e. 1:2. The record date for the same is August 29, 2019 while the ex-date for the same is today i.e. August 28, 2019.
"Consequently, Brigade Enterprises’ share price, as per Tuesday's closing price, has adjusted to Rs 185 per share from Rs 277 per share. Accordingly, our target price stands revised to Rs 220 per share. We maintain buy recommendation on the stock," ICICI direct said.
Market Near Day's Low:
The market extended losses in afternoon trade due to further selling in banking & financials, auto and FMCG stocks.
The BSE Sensex was down 216.97 points at 37,424.30 and the Nifty50 fell 61.90 points to 11,043.50.
Hinduja Ventures To Become An Operating Media Corporation
"The Board of Directors of Hinduja Ventures (HVL) have approved Scheme of Arrangement between IndusInd Media and Communications Limited (demerged company) and Hinduja Ventures Limited (resulting company) and their respective shareholders subject to all statutory/ regulatory approvals and approval of the shareholders," company said.
The IndusInd Media & Communications Limited (IMCL) business consists of digital content distribution using multiple platforms such as satellite and fibre. It also carries broadband and internet business carried out through its subsidiary OneOTT Intertainment Limited (OIL). IMCL also has a dedicated unit that develops content for various platforms and owns a significant content library and movie negatives.
PVR Opens new Multiplex in Rajasthan
Company informed exchanges the opening of 3 screens multiplex at Riddhi Siddhi Mall in Sri Ganganagar, Rajasthan. The multiplex is equipped with BARCO 2K projection system, Ultra-High Brightness 3D technology and 7.1 Digital Dolby surround sound, it said.
With this launch, PVR now becomes the first Cinema Exhibitor in India to reach 800 screens at 170 properties in 69 cities, it added.
Market Extends Losses:
Benchmark indices extended losses in noon with the Sensex falling 168.13 points to 37,473.14 and the Nifty50 declining 50.70 points to 11,054.70.
Rupee Update
The rupee depreciated by 23 paise to 71.71 against the US dollar in last morning deals amid unabated foreign fund outflows and cautious opening in domestic equities.
Forex traders said concerns about US-China trade spat kept market participants edgy.
Technical View
"The time-wise consolidation phase between October 2018 and Febraury 2019 saw index struggling around 11,150. The same proved to be the line of defense During May 2019 decline. Thereafter, in the entire month of August, index has found it difficult to overcome the hurdle zone around 11,100. With index trading around supply zone, higher price volatility cannot be ruled out this week and stock-specific theme is likely to continue," Yes Securities said.
Market Falls:
Benchmark indices remained under pressure with the Sensex falling 134.10 points to 37,507.17 and the Nifty declining 38.90 points to 11,066.50.
IDBI Bank Cracks 10%
Shares of IDBI Bank plunged 10 percent intraday after global rating agency S&P placed lender on Credit Watch, citing uncertainty over meeting capital requirements.
S&P Global Ratings, on August 27, placed its 'BB' long-term and 'B' short-term foreign currency issuer credit ratings on IDBI Bank on Credit Watch with negative implications.
"We also placed our issue ratings on the bank's senior unsecured debt on CreditWatch with negative implications," the rating agency said.
Rupee To Remain Rangebound
Ashish Parthasarthy, Treasurer at HDFC Bank (in an interview to CNBC-TV18) said there are expectations of further policy rate cuts going ahead.
"Repo rate can go down to about 5 percent with more rate cuts. While rates are coming down, investors may look at higher rating instruments," he added.
The Reserve Bank of India in its August policy meeting cut repo rate by 35bps to 5.4 percent.
Parthasarthy expects rupee to consolidate further and remain under pressure. Rupee’s partial correction has been driven by global factors, he said.
The Indian rupee corrected 4.6 percent against the US dollar since the beginning of July this year.
Parthasarthy expects rupee to consolidate between 71-73 a dollar over the next two months.
Sectoral View
Gautam Shah of JM Financial, in an interview to CNBC-TV18, said there would be volatility in banking space going ahead and stocks that remained insulated in the fall will keep doing well.
According to him, if Nifty Bank breaches 28,200 on higher side, it can run towards 29,000 levels.
He said many sectoral indices are trading at medium-term support levels after recent sharp correction.
As far as auto stocks, which had been beaten down badly for last one year odd, he said he sees a strong chance of a pullback in auto stocks.
"We are seeing a possibility of a 1,000-point recovery in the Auto index and If Auto Index rebounds, it will be a good sentiment booster," he added.
Market Update
Benchmark indices started consolidating at around 11,100 on the Nifty and the formation of Doji candle also indicated indecisiveness among bulls and bears.
The BSE Sensex was down 4.14 points at 37,637.13 and the Nifty rose 9 points to 11,114.40.
The market breadth remained in favour of bulls as about 729 shares advanced against 417 declining shares on the BSE.
Market Outlook
Gautam Shah of JM Financial told CNBC-TV18 that the market has gone through a lot of pain in last few weeks and 12 percent decline from all-time highs is not a big fall.
"Nifty appeared very oversold at 10,600 levels and bearish momentum has been arrested for the time being," he said.
He believes 11,150 is a important level for the Nifty. If the index clears 11,150 levels, it can take aim at 11,450 levels, according to him.
Market is likely to get into a large rangebound trading phase as large part of the market has bottomed out, he feels.
Shah believes this will be a stock and sector specific market for some weeks.
On US markets, he said he continued to have a very bearish view. "We don't think market will be out of the woods for next few months."
Dilip Buildcon In Focus
Company informed exchanges that the project rehabilitation and up-gradation of Eeppurupalem - Ongole Section with paved shoulder in Andhra Pradesh under NHDP -IV on EPC basis has been provisionally completed.
"The Provisional Completion Certificate has been issued by the authority August 17 and has declared the project fit for entry into operation as on July 20, 2019," company said in its BSE filing.
Market Opening:
Benchmark indices corrected after three-day gains. The BSE Sensex was down 45.94 points at 37,595.33 and the Nifty50 fell 16.90 points to 11,088.50.Citi on Jubilant Foodworks
Citi has buy rating on Jubilant Foodworks with a target price at Rs 1,400 per share as the recent launch of Hong’s Kitchen is its first attempt to create its own-brand.
"Company is one of the few consumer stocks where there is valuation support and we estimate 13/16 percent revenue/EPS 3-year CAGR," the brokerage said.
Rupee Opening:
The Indian rupee has opened at 71.52 against the US dollar, lower by 4 paise compared to previous day's close of 71.48 a dollar.
Market Pre-opening Settlement
Benchmark indices settled on a flat note in pre-opening. The BSE Sensex was up 13.98 points at 37,655.25 and the Nifty fell 4.10 points to 11,101.30.
US Markets
Wall Street slipped on Tuesday, weighed down by financial stocks as a deepening of the Treasury yield curve inversion raised US recession worries and uncertainty over any progress in trade negotiations between the United States and China took a toll.
The Dow Jones Industrial Average fell 124.66 points, or 0.48%, to 25,774.17, the S&P 500 lost 9.53 points, or 0.33%, to 2,868.85, and the Nasdaq Composite dropped 26.79 points, or 0.34%, to 7,826.95.
Asia Update
Asian shares eked out meager gains on Wednesday, as higher Wall Street futures provided some relief for investors after an overnight US selloff. MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.03 percent, Japan's Nikkei rose 0.04 percent and Australia's shares rose 0.07 percent.
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