Anand James, Chief Market Strategist, Geojit Financial Services
Domestic indices traded flat for the second consecutive day ahead of the FOMC rate decision scheduled later today. FII's passive trading approach with capital inflow limited to primary market and debt also might have weighed down the momentum of the indices near the record high levels. Investors could now be eying GST rate revisions and updates on GST implementation in the petroleum products to take the next crucial step.
3:50 PM Sectoral trend at close
3:43 PM Top gainers and losers on Sensex
The market breadth, indicating the overall health of the market, was strong. On the BSE, 1,358 shares declined and 1,215 shares rose. A total of 160 shares were unchanged.
The BSE Smallcap index pared gains to end 0.1% lower, while the BSE Midcap index closed flat.
Markets end little changed
The Sensex settled at 32,400, down 2 points, while the Nifty closed at 10,141, down 6 points.
IUC cut to dent margins of Bharti and Idea
The move, analysts believe, will negatively impact margins of the incumbent telecom companies- Bharti Airtel and Idea Cellular. Reliance Jio, on the other hand, will stand to gain. They also believe that the ultimate beneficiary of the move will be the consumer that could end up paying less for voice calls. Since the usage is moving more towards data, with interconnect charges seeing a steep cut and sharp growth in data uptake, incumbents will introduce more (data and voice) bundled plans going ahead. READ FULL STORY
Jaitley briefs media after Cabinet meeting
JUST IN: Govt to transfer ITDC hotels in Jaipur, Mysore, Itanagar to states
Jaitley briefs media after Cabinet meeting
JUST IN: Cabinet okays transfer of 3 more ITDC hotels to states
3:12 PM European markets
European stocks hovered in cautious trade on Wednesday ahead of a policy decision by the US Federal Reserve, with rate-sensitive banking shares edging lower. The pan-European STOXX 600 was flat in percentage terms, helped by buoyant energy stocks and gains among the more defensive health care sector, while euro zone blue chips retreated 0.1%. Britain's FTSE was listtle changed, while France' CAC 40 was trading marginally higher.
SMS Lifesciences is locked in upper circuit for the 24th straight session, up 5% at Rs 475 on BSE, with only buyers seeing on the counter. READ MORE
Sebi revokes ban on 114 entities
Markets regulator Sebi has revoked trading ban imposed on 114 entities, which had come under the scanner for alleged manipulation and misuse of stock market platform for tax evasion, saying it did not find any adverse evidence against them. READ FULL REPORT
Bharti Airtel recovers after initial fall
Bharti Airtel recouped losses in noon deals to trade at Rs 395 levels after falling nearly 6% to Rs 370 on the Bombay Stock Exchange (BSE). Idea Cellular, on the other hand, continued to trade over 2% lower at Rs 81 levels. READ FULL REPORT
2:23 PM Nifty PSU Bank leading sectoral gainer in noon deals
The BSE Smallcap index outperformed to add 0.2%, while the BSE Midcap index was little changed.
At 1:50 pm, the Sensex was trading at 32,435, up 33 points, while the broader Nifty50 was ruling at 10,148, up 0.90 point.
Oil and Natural Gas Corp (ONGC) rose as much as 3% to a three-month high after Reuters reported that the oil explorer discovered reserves of about 20 million tonnes of oil and gas, citing sources. READ FULL REPORT
Kotak Institutional Securities on cement companies
Valuations of cement companies are rich, and factor improved contribution from expanded capacities. However, we caution that cement companies will either have to adopt a modest capacity ramp-up or risk disruption in cement prices.
A way out would be a robust demand growth, that can better help absorb incremental capacities—though current demand trends and likely curtailment of government spending (owing to budget constraints) are not supportive of a strong demand revival.
ONGC discovers 'good' offshore oil, gas field with reserves of 20 mn tonnes
Oil and Natural Gas Corp to the west of its Mumbai High offshore fields is estimated to hold in-place reserves of about 20 million tonnes, sources with knowledge of the matter said.
The Mumbai High field annually produces oil and natural gas of about 9 million to 10 million tonnes of oil equivalent. The company discovered hydrocarbon reserves west of Mumbai High at well WO 24-3 in July.
ONGC tested nine zones in the well, the two sources with knowledge of the matter told Reuters.
These stocks rallied over 50% in 1 week
Bharati Defence and Infrastructure, Walchandnagar Industries, Shivalik Bimetal Controls, Toyo Rolls and Tinplate Company are among 10 stocks, which have rallied more than 50% in past one week.
SBI Life Insurance IPO opens today. Should you invest
SBI Life Insurance Company Ltd is the India’s largest private life insurer in terms of new business premium (NBP) generated in each fiscal year since FY10. It has also increased its market share of NBP generated among private life insurers in India, from 15.9% in FY15 to 20% in FY17.
Over FY15-17, the company’s NBP increased by 35.5% CAGR, which is the highest among the top five private life insurers (in terms of total premium in FY17) in India.
to find what leading brokerages and research houses suggest.
Tata Motors steps on the accelerator, JLR adds pace
Tata Motors has gained about 13% over the past 10 trading sessions on better earnings growth prospects and on reports that the promoters are increasing their stake in the company.
Currently, promoter group companies together have a 34% share in Tata Motors, of which Tata Sons alone holds 31%. Analysts at Bank of America-Merrill Lynch and Motilal Oswal Securities say the second half of financial year 2017-18 (FY18) would be better aided by new launches and changes to the hedging policy. READ MORE
SBI Life raises Rs 2,226 crore from anchor investors
Country's largest private sector life insurer SBI Life Insurance Company has allotted 31.8 million shares worth Rs 2,226 crore to 69 anchor investors. The allotment was made at Rs 700 apiece, the top-end of the IPO prove band.
SBI Life's Rs 8,400-crore IPO opens on Wednesday and will close on Friday.
Some of the anchor investors are Blackrock, Canada Pension, Govt of Singapore, Aranda, Abu Dhabi Investment Authority, HSBC, Wells Fargo, Kuwait Investment Authority and Rochdale.
The price band for the IPO is Rs 685 to Rs 700 per share. READ MORE
Tyre stocks rally up to 11% after govt imposes anti-dumping duty
Shares of tyre companies such as J&K Tyre, MRF, Apollo Tyres, and TVS Srichakra etc rallid up to 11% follwoing news reports that the goverment has imposed the anti-dumping duty on import of certain type of radial tyres used in buses and trucks.
The decision has been taken to protect the domestic manufacturers from below-cost shipments from China for five years.
Reacting to the developmnet, JK Tyre gained as much as 11.7% to Rs 165. TVS Srichakra, MRF, Apollo Tyres, PTL Enterprises and Ceat added anywhere between 1% to 3%. READ MORE
Pain ahead for realty, housing finance players
The real estate sector is seeing the exposure of certain common malpractices. One model for raising money is for developers to pre-sell unbuilt houses. The deal is, the buyer takes a loan and hands over the amount to the builder. T
he builder pays the equated monthly instalment (EMI) until the house is delivered for possession. This way, the builder gets cheaper capital (home mortgages are at lower rates than commercial real estate loans); the lender can lend more easily (banks have high-risk weights for real estate and sector limits for real estate exposure. READ MORE
Divi’s Laboratories gains
Divi’s Laboratories moved higher by 6% to Rs 915 on BSE in intra-day trade after the company announced that all the previous observations by US drug regulator regarding Unit-2 of its Visakhapatnam facility have been confirmed as completed and resolved.
The stock hit nine-month high and was trading at its highest level since December 23, 2016 on BSE. It outperformed the market by surging 47% in past one month, as compared to 4% rise in the S&P BSE Sensex. Read full report here
11:05 AM Buzzing Stock
Hindustan Copper rose 0.96% to Rs 63.30 at 09:21 IST on BSE after the company signed MoU with Nalco and Mineral Exploration Corp to form a joint venture for exploration and sale of minerals.
Larsen & Toubro gains
Larsen & Toubro (L&T) was up by 1.5% to Rs 1,244 on BSE after the company announced that it has won contract valued around Rs 1,700 crore to build crude oil pipeline from Kuwait Oil Company (KOC), Kuwait.
“L&T’s hydrocarbon division has bagged a major pipeline contract with a value close to Rs 1,700 crore from Kuwait Oil Company (KOC) for engineering , procurement and construction of new 48” crude transit line (TL-5) from North Kuwait to Ahmadi,” the company said in a press release. READ FULL REPORT HERE
IPO Note on SBI Life Insurance Company by Geojit Financial Services
Rating – Subscribe
Price Range - Rs 685 - Rs 700
The untapped opportunity and lower penetration in life insurance provides ample scope for the company to grow its portfolio at a rapid pace. SBI Life had an Embedded Value (EV) of Rs16,538cr as on FY17 with an operating RoEV of 23% (EV is a common valuation measure in the insurance industry which measures potential future profits from existing business).
At upper price band of Rs700, SBI Life is available at P/EV of 4.2x on FY17 EV. We believe SBI Life commands a premium valuation over its peers on account of its leadership position and better financial parameters.
We recommend 'Subscribe' to the issue only with a long term perspective given high valuation.
10:12 AM JUST IN: Thyssenkrupp & Tata Steel sign MoU for a 50-50 European steel JV which will be named 'Thyssenkrupp Tata Steel'
NPA-laden state-run banks crimp advance tax mop-up at 10.6%
A steep fall in advance tax payouts by bad loan-saddled state-run banks has led to a muted 10.6 per cent growth in overall revenue mop-up from large corporates in the megapolis in the September quarter.
The overall mop-up at Rs 69,000 crore, up 10.64 per cent, is tepid even though other sectors like steel and even private sector lenders have done comparatively well, income tax department sources said
Unsatisfied with the collection, the department has asked its officials to keep a close vigil on the forthcoming quarterly results by large corporates. READ MORE
Equity funds sitting on Rs 50,000-crore cash pile
Equity fund managers are sitting on a cash pile of over Rs 50,000 crore, say industry sources. Some even peg it at Rs 75,000 crore, considering the equity component of popular balanced funds.
Fund managers say cash as a percentage of the corpus for several of their schemes is now in the double digits as inflows into equity schemes have been consistently high while stock valuations soar.
Between January and August, equity schemes, including ELSS, have received inflows of Rs 81,000 crore, and balanced funds Rs 53,000 crore. READ MORE
9:39 AM Buzzing Stock
Adani Power gained over 3.5% after 2 Adani Power companies managed to secure a shade over one-third of the total coal auctioned by Coal India under the Shakti scheme by offering discounts ranging from 1 paise per unit to 3 paise per unit over existing tariff.
9:33 AM RIL gains
Reliance gained over 2% after Trai cuts IUC to 6 paise per minute from October 1. The new charges are being seen as a relief for the latest entrant, Reliance Jio. It is estimated to save about Rs 3,800 crore annually from this move.
9:28 AM Bharti Airtel slips
Bharti Airtel fell as much as 6% at open after Telecom Regulatory Authority of India (Trai) cut the interconnect usage charges (IUC, also known as terminating charges) by 57 per cent to 6 paise per minute effective October 1, from 14 paise currently.
In two years, the charges would come down to zero, meaning there won’t be any payment for calls landing on other telcos’ networks. READ MORE
The stock pared some losses and was trading over 2% lower at 9:28 am.
9:22 AM Top gainers and losers on BSE Sensex
9:18 AM Broader Markets
Broader markets were trading inline with the benchmark indices with BSE Midcap and BSE Smallcap up 0.3% and 0.4% respectively
9:17 AM Markets open
Rangebound movement continue in the benchmark indices on Wednesday, as investors await the outcome of two-day Fed policy review later in the day. A weakness in the rupee and concerns over the war of words between the US and North Korea may also dampen the sentiment.
At 9:17 am the S&P BSE Sensex was trading at 32,475, up 73 ponts while the broader Nifty50 index was ruling at 10,166, up 19 points
Top trading ideas for today's trade by HDFC Securities
Kajaria Ceramic - BUY
CMP: Rs 737
Stop Loss: Rs 700
Target: Rs 800
Gujarat Industries Power - Buy
CMP: Rs 139
Stop Loss: Rs 132
Target: Rs 153
Nifty Outlook by HDFC Securities
Nifty is maintaining the bullish setup of higher tops and higher bottoms with most of the oscillators indicating bullish momentum. Nifty has also broken out from the consolidation and now looks all set to extend the rally towards next target of 10,540. Support has now shifted upwards to 10,043 in Nifty.
Technical calls from Prabhudas Lilladher:
BUY FEDERAL BANK
CMP: Rs 119.10
TARGET: Rs 130
STOP LOSS: Rs 112
The stock has been on a good rise in recent times from the low of Rs 104 and is on the verge of a breakout above the Rs 121. The RSI indicator is on the rise indicating strength and potential to rise still further and scale fresh new heights. With decent volume participation witnessed, we recommend a buy in this stock for an upside target of Rs 130 keeping a stop loss of Rs 112.
Nifty View from Prabhudas Lilladher:
Nifty after making a new high, is taking a breather with a positive bias witnessing the level of 10,080 as near-term support. Our view remains bullish for a projected target of 10,200-10,250. However, the support for the day is seen at 10,100 while resistance is seen at 10,200.
SBI Life's $1.3 billion IPO to open today
The capital market will see India's first billion-dollar initial public offering (IPO) since 2010 today. SBI Life Insurance, a subsidiary of the country's largest lender SBI, will hit the market on to raise up to Rs 8,400 crore. The IPO, which has a price band of Rs 685 to Rs 700 per share, is expected to be the largest in the insurance space.
ICICI Lombard IPO oversubscribed 3 times on last day
The initial share sale offer of ICICI Lombard General Insurance Company was oversubscribed 2.98 times at the end of the last day of bidding on Tuesday, stock exchange data showed.
The initial public offer (IPO), through which the insurer is looking to raise about Rs 5,700 crore, received bids for 18,34,60,772 shares against the total issue size of 6,16,66,740 shares, as per NSE data.
The category reserved for qualified institutional buyers (QIBs) was oversubscribed 8.17 times, non institutional investors 83 per cent and retail investors 1.21 times, investment banking sources said. READ MORE
8:52 AM Trai cuts IUC to 6 paise per minute from October 1
In a fresh blow to incumbent mobile operators, including Bharti Airtel and Vodafone, the Telecom Regulatory Authority of India (Trai) has cut the interconnect usage charges (IUC, also known as terminating charges) by 57 per cent to 6 paise per minute effective October 1, from 14 paise currently. In two years, the charges would come down to zero, meaning there won’t be any payment for calls landing on other telcos’ networks. READ MORE
Donald Trump warns US may have to 'destroy' North Korea
President Donald Trump warned leaders gathered at the UN General Assembly on Tuesday that the United States may have to destroy North Korea if Kim Jong-Un's nuclear-armed regime threatens its neighbours. "Rocket Man is on a suicide mission for himself and for his regime," he said, using his new nickname for the North Korean leader, Kim Jong Un.
The Nifty50 futures on the Singapore Stock Exchange were trading 16 points lower at 10151 indicating a flat opening for the domestic market.
8:39 AM Asian peers steady
Asian stocks were mostly steady on Wednesday after Wall Street again rose to record highs, although movements were limited as a wait-and-see mood prevailed before the Federal Reserve reveals its monetary policy stance later in the day.
MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.1%.
Japan's Nikkei was flat and South Korea's KOSPI was off 0.2%.
8:38 AM Wall Street
The three major US stock indexes edged higher on Tuesday, logging closing records, with financial stocks providing the biggest boost a day ahead of the Federal Reserve’s concluding statement from its two-day policy meeting.
The Dow Jones Industrial Average rose 39.45 points, or 0.18%, to 22,370.8. The S&P 500 gained 2.78 points, or 0.11%, to 2,506.65 and the Nasdaq Composite added 6.68 points, or 0.1%, to 6,461.32.
8:37 AM Good Morning and welcome to markets's live blog. Catch all the live market action here
First Published: Wed, September 20 2017. 15:35 IST