Sensex, Nifty end rollercoaster ride in green; GAIL up 10%
20 Nov 2015
The market closed marginally higher after a rollercoaster ride on Friday. The Sensex rallied 217 points intraday to hit 26000-mark after a flat start but could not sustain in last hour of trade. Technology, select oil & gas and auto stocks supported market but the selling in banking & financials and index heavyweight ITC limited upside.
The 30-share BSE Sensex rose 26.57 points to 25868.49 and the 50-share NSE Nifty advanced 13.80 points to 7856.55. The broader markets outperformed benchmarks with the BSE Mipcap and Smallcap indices rising 0.9 percent and 0.6 percent, respectively.
The market has seen consolidation and has been in a range of 7500-8000 for quite some time, but despite that experts say they remain bullish on India.
Christopher Wood, CLSA says Greed & fear maintains a triple overweight on India in the Asia Pacific ex-Japan relative-return portfolio and 46 percent of the Asia ex-Japan long-only portfolio is invested in India.
He believes it is still the case for now that India remains a better relative-return story in the Asia and emerging market context than an absolute-return story given the continuing lack of any evidence of a renewed private-sector capex cycle.
For the week, the Sensex and Nifty gained 1 percent each, especially driven by global rally post FOMC minutes that indicates likely hike in Fed rates in December.
Gas stocks were in limelight today on reports that RasGas, the Qatar-based company, may modify long term contract with Petronet LNG. GAIL topped buying list on the Sensex, up 10 percent. Petronet LNG, Indraprastha Gas and Gujarat Gas gained 4-7 percent.
IDFC Securities sees maximum benefit of RasGas deal to GAIL due to reduction of Petchem cost, improving transmission volumes and no take or pay liability. In case of Petronet LNG, the brokerage says the company will see recovery of Rs 160 crore shipping cost.
Dr Reddy's Labs was up 1.9 percent after losses in previous sessions. The company has filed a lawsuit in a US court against AstraZeneca for material breach of a settlement agreement that had released the company from any liability in connection with generic versions of Nexium.
Select auto stocks continued to be in demand after recommendations by 7th pay commission. The seventh Central Pay Commission has recommended a 23.6 percent hike in pay, allowances and pensions for central government employees. Maruti Suzuki, Mahindra & Mahindra and Bajaj Auto gained 1.5-2 percent.
Among others, Reliance Industries, TCS, Infosys, Wipro, L&T and Vedanta were up 0.5-2 percent while ITC and Sun Pharma saw profit booking, down more than 2 percent. HDFC, Tata Motors, ICICI Bank, Axis Bank and Hindalco declined 0.5-1 percent.
In broader space, Adani Power rose 2.3 percent after the Supreme Court set aside customs demand of Rs 300 crore against the Gujarat-based power generation company. Financial Technologies rose gained 2 percent on completion of sale of its entire 25.64 percent stake in IEX.
Jubilant Foodworks went up 2 percent as analysts expect higher discretionary spending on the back of 7th pay commission recommendation. Additionally the company in its presentation at the Morgan Stanley Global Consumer & Retail Conference has stated that it increased potential store count for India to 1800 from 1300.
The market breadth was positive as about 1448 shares advanced against 1206 declining shares on the BSE.
On the global front, Asian markets ended higher as investors continue to mull a likely interest rate hike by the US Federal Reserve in December. Hang Seng jumped 1.1 percent and Shanghai gained 0.4 percent. European markets were mixed despite hopes of further European Central Bank stimulus, as uncertainty over global security and the economy weighs on investor sentiment.
3:30 pm Market closing: After a volatile hour of trading, the market ended on a flat note. The Sensex was up 26.57 points or 0.1 percent at 25868.49 and the Nifty ended up 13.80 points or 0.2 percent at 7856.55. About 1450 shares have advanced, 1203 shares declined, and 231 shares are unchanged.
GAIL, Wipro, Maruti, Dr Reddy and Cipla were top gainers while Sun Pharma, ITC, Hindalco, HDFC and Hero were losers.
3:10 pm Bond auction: Leading stock exchange BSE on Monday will auction investment limits for foreign investors to buy government debt securities worth Rs 332 crore.
The auction will be conducted on BSE ebidxchange platform from 1530 hours to 1730 hours after the close of market hours on Monday, November 23, the exchange said in a circular issued on Friday.
The debt auction quota gives overseas investors the right to invest in the debt, up to the limit purchased.
2:52 pm Market trims gains: Equity benchmarks trimmed gains in last hour of trade. The Sensex rose 112.22 points or 0.43 percent to 25954.14 and the Nifty advanced 31.95 points or 0.41 percent to 7874.70.
About 1491 shares have advanced, 1088 shares declined, and 228 shares are unchanged on the BSE.
2:40 pm FII View: Christopher Wood, CLSA says Greed & Fear maintains a triple overweight on India in the Asia Pacific ex-Japan relative-return portfolio and 46 percent of the Asia ex-Japan long-only portfolio is invested in India.
He believes it is still the case for now that India remains a better relative-return story in the Asia and emerging market context than an absolute-return story given the continuing lack of any evidence of a renewed private-sector capex cycle.
This is why the Indian stock selection in the long-only portfolio remains relatively low beta, Wood says.
2:20 pm Fitch on 7th pay commission: Fitch Ratings said a proposed 23.6 percent hike in salaries and pensions for about 10 million current and former government employees in India could hurt the country's finances and underscore the weakness in its sovereign credit profile.
The pay hike proposed on Thursday by an Indian government panel is smaller than past increases as New Delhi faces pressure to curb its fiscal deficit. It would add at least 1.02 trillion rupees (USD 15.43 billion) to federal spending in 2016 - the first year of implementation - if accepted.
Fitch said the pay hike could challenge the government's goal of achieving a fiscal deficit of 3.5 percent in the year ending in March 2017, unless India can cut spending or raise revenues.
2:00 pm Market Check
Equity benchmarks as well as broader markets continued to see buying interest in afternoon trade, led by technology, oil & gas, banking & financials and select auto stocks.
The 30-share BSE Sensex rose 183.96 points or 0.71 percent to 26025.88 and the 50-share NSE Nifty climbed 54.35 points or 0.69 percent to 7897.10. The BSE Midcap and Smallcap indices gained 1 percent each.
The market breadth was positive as about 1565 shares advanced against 952 advancing shares on the BSE.
Shares of TCS, Reliance Industries, ICICI Bank, Mahindra & Mahindra, Maruti Suzuki, Bajaj Auto, Wipro, Vedanta, Tata Steel and BHEL gained 1-3 percent.
GAIL continued to be top gainer on Sensex, up nearly 10 percent on reports of likely modification in long term gas contract with RasGas, the Qatar-based company. Petronet LNG was up over 6 percent.
ITC and Sun Pharma underperformed benchmarks, down 1-1.7 percent followed by HDFC, Tata Motors, Axis Bank and Bharti Airtel with marginal loss.
1:50 pm Telecom: The Telecom Regulatory Authority of India (TRAI) is working to balance the interest of stakeholders and growth of the industry, says RS Sharma, TRAI Chairman. Discussing the call drop situation and resistance of telecos on the compensation, Sharma says that the decision was taken after consultation with stakeholders. In October, TRAI had mandated that telcos from January 1 should compensate users at the rate of Re 1 per call drop, with the ceiling of Rs 3 per day or three calls dropped.
1:40 pm Pharma update: Indian companies alone are not caught with US FDA issues, says Ramesh Swaminathan, President Finance & Planning, Lupin adding that worldwide companies are facing wrath of the regulator. "The genesis of the (UD FDA) problem was essentially because of the fact that you had cases of low molecular heparin emanating from China, a case of melamine in milk, lead in paints and of course, you had issues with Indian companies in terms of fudging data and the likes and all of this actually caused the FDA to sit up and take notice possibly," he says. In an interview to CNBC-TV18, Swaminathan says US FDA approvals will pick up next year onwards.
1:30 pm RBI directives: Reserve Bank of India (RBI) directed banks that they should lend at least 11.57 percent of their funds directly to non-corporate farmers in the fiscal 2015-16. RBI set the target for direct lending by banks to agriculture under priority sector at 11.57 percent, which is based on the system-wide average of the last three years' achievement with regard to overall direct lending to non-corporate farmers. "It is hereby brought to the notice of all concerned that the applicable system-wide average figures for computing achievements under priority sector lending for the FY 2015-16 is 11.57 percent," the central bank said in a notification.
The market continues it surge supported by infra, oil & gas and IT stocks. The Sensex is up 192.96 points or 0.7 percent at 26034.88 and the Nifty is up 57.60 points or 0.7 percent at 7900.35. About 1516 shares have advanced, 930 shares declined, and 218 shares are unchanged. Midcap index is up 1 percent.
GAIL, Bajaj Auto, TCS, Wipro and Vedanta are top gainers while Sun Pharma, ITC, HDFC, Bharti Airtel and Axis Bank are among the losers.
Extending gains for the third straight day, gold prices advanced by 0.27 percent to Rs 25,530 per 10 grams in futures trade on Friday as speculators enlarged positions, taking positive cues from overseas markets. Analysts attributed the rise in gold futures to a firming global trend where it held an advance from a five-year low as Federal Reserve Vice Chairman Stanley Fischer said that US policy makers have done their best to prepare international markets for the first interest rate increase since 2006.
12:55 pm Market update: Equity benchmarks continued to see buying interest. The Sensex climbed 180.12 points to 26022.04 and the Nifty rose 52.90 points to 7895.65.
About 1481 shares have advanced, 913 shares declined, and 216 shares are unchanged on the BSE.
12:40 pm Toll collection rights: Shares of MEP Infrastructure Developers gained 3.4 percent intraday on getting toll collection rights at Dastan village in Maharashtra.
"MEP has been awarded by Mumbai-JNPT Port Road Company Limited (a SPV of National Highways Authority of India) the rights for collection of user fee through user fee collection agency on the basis of competitive bidding at Km 9.100 (toll plaza near Dastan village) for widening/ improvement of Amra Marg including construction of new six lane bridge on Panvel creek in Maharashtra," the company said in its filing.
It was the fifth toll collection right for the company since September 30.
12:20 pm GMR Infra in News: GMR Energy today said its subsidiary GMR Rajahmundry Energy Ltd (GREL) has commenced commercial operation of gas-based 768MW power plant in Rajahmundry, Andhra Pradesh.
Power generated from this plant would be supplied to Andhra Pradesh power distribution companies. "The commercial operation of the power plant commenced with the beginning of gas supply under e-bid RLNG Scheme (Scheme for Utilisation of Stranded Gas-based power plants), which was launched by the Centre in March, 2015", GMR Energy said in a BSE filing.
With e-bid RLNG Scheme, the 768MW power plant can now operate at 50 percent Plant Load Factor (PLF), thereby generating 384 MW and supplying power to AP discoms continuously, it said.
12:00 pm Market Check
Equity benchmarks gained more strength in noon trade, supported by banking & financials and technology stocks. The Sensex rallied 210.05 points or 0.81 percent to 26051.97 and the Nifty rose 62.05 points or 0.79 percent to 7904.80.
The broader markets also gained in line with benchmarks as the BSE Midcap and Smallcap indices surged 0.9 percent each. The market breadth was positive as about 1462 shares advanced against 794 declining shares on the BSE.
GAIL continued to be top gainer on Sensex, up more than 9 percent on reports of likely modification in long term gas contract with RasGas, the Qatar-based company. Petronet LNG was up over 6 percent.
Among others, TCS, Infosys, HDFC Bank, ICICI Bank, SBI, M&M, Maruti, Wipro, Dr Reddy's Labs and Bajaj Auto gained 1-3 percent. However, ITC, Sun Pharma, Bharti Airtel and Hindalco were under pressure.
11:55 am Outlook: Growth in the economy is likely to pick up in the next six to nine months, is the word coming in from Vikram Limaye, MD & CEO, IDFC. According to him there is yet no sign of pick up in investment cycle and the rural economy. So, unless that picks up, it would be difficult for growth to see an uptick. Rural economy is likely to pick up in the coming 12-18 months, he adds.
He expects earnings growth to be in the range of 7-10 percent in FY17. Corporates too are currently cautiously optimistic on the economy.
11:45 am Buzzing: Shares of Amtek Auto gained 2 percent intraday, in addition to 4 percent rally in previous session. A media report indicated that Asian vulture investor SSG Capital Management has stepped in to buy out the company's debentures that owned by JPMorgan Asset Management Company.
"While SSG plans to directly buy out the Rs 200 crore debenture holding held by JPMorgan, Amtek intends to settle the issue of the remaining Rs 600 crore debentures with the banks and realign the debt with Amtek's future cash flows," a media report said quoting unnamed sources.
SSG Capital is a Hong Kong based fund which manages USD 1.3 billion across Asia.
11:30 am GST: State finance ministers will meet tomorrow to elect the new Chairman of the Empowered Committee and also discuss the model Goods and Services Tax (GST) law as well as report on the revenue neutral rate. The Empowered Committee of State Finance Ministers has to elect the new Chairman as K M Mani has resigned from the post subsequent to stepping down as the Kerala Finance Minister. The Centre had last month circulated among states the draft of CGST, SGST and iGST for their comments.
The market is surging higher. The Sensex is up 185.73 points or 0.7 percent at 26027.65, and the Nifty is up 62.25 points or 0.8 percent at 7905.00. About 1446 shares have advanced, 715 shares declined, and 171 shares are unchanged.
GAIL, Wipro, M&M, SBI and TCS are top gainers while Sun Pharma, ITC, Bharti and Hindalco are among losers in the Sensex.
Oil futures inched up in early Asian trading, but remained near three-month lows after a persistent supply glut has cut prices by up to 13 percent since the start of November. Market data suggests that oil traders are preparing for another downturn in prices by March 2016, as what is expected to be an unusually warm winter dents demand just as Iran's resurgent crude exports hit global markets after sanctions are ended.
11:00 am Market rebounds: Equity benchmarks recouped losses. The Sensex surged 153.78 points or 0.60 percent to 25995.70 and the Nifty rose 44.75 points or 0.57 percent to 7887.50.
About 1366 shares have advanced, 704 shares declined, and 162 shares are unchanged on the BSE.
10:50 am Sugar exports: An expected influx of Indian sugar exports to the global market is unlikely to spur rival exporters in Brazil to increase discounts because Indian tonnages are likely to be moderate, European trade sources said on Thursday.
They said that shipments of Indian raw or low quality white sugar for export were likely to represent only a small fraction of Brazilian raw sugar tonnages.
"I don't think the Brazilians will discount further -- some 2 million tonnes a month of Brazilian raws are going out quite happily, against potentially 200,000 to 300,000 tonnes a month of Indian bagged raws or whites," a senior European trader said.
Furthermore, cheap freight means that Indian sugar exports to key Asian markets will have only a modest advantage over rival Brazilian offers.
10:40 am Oil prices higher: Oil prices were higher in Asia today, but gains were limited in a market burdened by a persistent oversupply.
A continued rise in US commercial crude inventories further confirmed predictions the glut will last well into next year, with Iran also expected ramp up production when Western sanctions are lifted under a deal with major powers to curb its nuclear programme.
US benchmark West Texas Intermediate (WTI) for delivery in December was trading three cents higher at USD 40.57 a barrel on its last trading day, while Brent crude for January was up 11 cents to USD 44.29.
10:20 am Market Update: Lack of leadership, given the global turmoil, is impacting the market adversely, says Andrew Holland, CEO of Ambit Investment Advisors.
Speaking to CNBC-TV18, Holland says the China's government need to work more on the fiscal policy front to aid recovery in global markets.
On the corporate earnings, he says that despite the reform work done by the Modi government, it will take time for earnings to bounce back. However, he is positive that earnings will start picking up from next year.
Lack of investment and outflows in India is due to the emerging markets (EMs) phenomenon, he says adding that the market will see FII inflows from the new year.
10:00 am Market Check
The market continued to see some profit booking amid consolidation today after more than a percent rally in previous session. Banking & financials also witnessed selling pressure but auto and select technology stocks supported market.
The Sensex fell 60.99 points to 25780.93 and the Nifty declined 22.15 points to 7820.60. The broader markets continued to outperform benchmarks with the BSE Midcap and Smallcap indices rising more than 0.4 percent.
The market breadth was positive as about 1011 shares advanced against 741 declining shares on the Bombay Stock Exchange.
GAIL and Petronet LNG gained more than 8 percent. JSPL surged 8 percent on getting clean chit from Competition Commission of India (CCI) in coal auction cartelisation case.
Bank Nifty fell 0.66 percent as ICICI Bank, SBI, Axis Bank and HDFC Bank were down 0.5-0.9 percent.
9:55 am IMF: China's yuan may enter the International Monetary Fund's benchmark currency basket at a lower weighting than previously estimated as the IMF considers rejigging the basket to better reflect financial flows, people briefed on the Fund's discussions told Reuters. IMF policymakers are expected to add the Chinese currency to the Special Drawing Rights basket later this month, after a campaign by Beijing for the yuan, or renminbi, to have equal billing with the dollar, euro, pound sterling and yen. Adding the yuan to the SDR basket would mark the biggest change since 1980, when the number of currencies in the basket was cut from 16.
9:45 am Gold scheme: Bankers expressed hope that the maiden gold bond scheme, launched by Prime Minister Narendra Modi earlier this month aimed at physical buying of the shiny metal, that closes today, is likely to gross around Rs 150 crore. "The scheme has already grossed up Rs 145 crore as of today and we expect the scheme to end with Rs 150 crore by the end of the day tomorrow," a senior public sector banker told PTI. The banker also said that the numbers look reasonably good considering that this is the limited period offer and that a maiden one.
9:30 am Clean chit: The Competition Commission of India (CCI) gave a clean chit to Jindal Steel Private Limited (JSPL) on allegations of cartelisation saying it hasn't found enough evidence to support the same. The case pertains to the government's decision of cancelling the coal mine bids of JSPL and Balco for four blocks amid reports of speculation of cartelisation during auctions.
The government had forwarded the complaints alleging cartelisation against JSPL to CCI, stating the company indulged in anti-competitive practises and price cartelisation. The government had cited low bids as the reason for cancellation of the winning bids.
The market has opened flat as the Sensex is down 23.77 points at 25818.15. The Nifty is down 12.80 points at 7829.95. About 550 shares have advanced, 260 shares declined, and 48 shares are unchanged.
GAIL, Dr Reddy's Labs, Wipro, Hero MotoCorp and TCS are top gainers in the Sensex. Among the losers are Sun Pharma, Hindalco, Lupin, Bharti Airtel and Reliance.
The Indian rupee has opened higher by 8 paise at 66.10 per dollar on Friday against previous close of 66.18 a dollar.
NS Venkatesh of IDBI Bank said, "The rupee closed marginally stronger yesterday based on the improved risk appetite seen in the market. There was marginal weakening of the dollar on account of the FOMC Minutes which suggested a gradual lift-off from December."
The dollar weakens across the board as investors cashed in recent gains driven by widespread expectations of a US Fed interest rate increase next month.
Asian shares looked set to hold on to this week's gains, while the dollar took a breather on Friday after stepping back from seven-month highs as investors grappled with the prospects of higher US borrowing costs and slower global economic growth.
Commodity prices were pressured, with copper near 6-1/2-year lows and a major sea freight index hitting its lowest level on record, underscoring worries over slackening world demand.
Markets showed limited reaction to comments from Fed Vice Chairman Stanley Fischer that the Federal Reserve has telegraphed its imminent interest rate hike so well to avoid rate liftoff surprise.