Anand James, Chief Market Strategist, Geojit Financial Services
Domestic indices pared the initial losses stimulated by a pull back in the banking stocks. Strong put writing was also seen at the 9800 strike indicating that traders may have deemed the downside a bit overdone, setting the stage for short covering ahead of the F&O expiry. GST council meeting scheduled in the first week of October may also enthuse the investors now, while the sharp weakness in rupee shall also give reprieve to exporters.
3:57 PM Nifty Realty leading sectoral gainer
All but two stocks were trading in red.
3:45 PM Sensex heatmap at close
Broader markets outperform
Broader markets bucked the weak trend with the BSE Smallcap and the BSE Midcap indices gaining 1% and 0.4%, respectively.
3:37 PM Markets at close
The S&P BSE Sensex settled the day at 31,599, down 26 points, while the broader Nifty50 was ruling at 9,871, down 1 point.
3:26 PM Volatility index
India VIX eases over 3% to 13.
3:15 PM Nifty Metal index recovers after five-session losing streak
3:06 PM Buzzing stocks
ITI, Indiabulls Ventures, Graphite India, Signet Industries, Deep Industries, MIRC Electronics, HEG and OM Metals Infraprojects are among the 39 stocks from the S&P BSE Smallcap index that have recovered more than 10% after a bounce back in equity market in late noon trade. READ MORE
2:59 PM Top five losers on Nifty
D-Mart market-cap crosses Rs 75,000 crore
Avenue Supermarts, which owns and operates D-Mart retail chain, have joined the league of companies with market capitalization(m-cap) of more than Rs 75,000 crore after more than 15% rally in shares on Tuesday. READ MORE
Broader markets outperform
The BSE Smallcap index gained over 15, while the BSE Midcap index was up 0.7% in the noon deals.
2:24 PM Mrakets check
At 2:15 pm, the Sensex was trading at 31,618, down 8 points, while the broader Nifty50 was ruling at 9,871, down 0.75 point.
Why the rupee could touch 66 in the next four months
To conclude, the risks to USD/INR stemming from global and domestic factors are skewed to the up side. While 64.35 would be a key support on the down side, levels of 65.50 and 66.00 could be seen in 4-6 months time frame. READ FULL ANALYSIS
D-Mart hits new high
Shares of Avenue Supermarts, which owns and operates D-Mart retail chain, on Tuesday, hit a new high of Rs 1,218, up 18% on the National Stock Exchange (NSE) in intra-day trade in an otherwise weak market on heavy volumes. READ MORE
BSE-500 underperforms Sensex in last 5 sessions
The selling spree continued on Dalal Street amid weak domestic and global cues. As the S&P BSE Sensex and the Nifty50 shed over 2% in the last five sessions, there were at least 45 stocks on the BSE-500, which tanked over 10% during the same period. CLICK HERE FOR FULL REPORT
European stocks opened lower on rising tensions between North Korea and the United States. The pan-European Stoxx 600 was 0.04% lower with most of the sectors moving in negative ground.
HDFC Securities on ITC
ITC, number 4 company in terms of market capitalisation in India, has suffered at the hands of regulatory changes wherein a prior lenient GST rate under the new taxation regime was followed by an increase in the tax incidence for cigarettes. Cigarettes being the major source of revenue, the company’s stock suffered.
However, we feel that the market has over- reacted and that other segments of the company, specifically the foods division under FMCG segment, the agri business and the hotels business have good growth potential and may drive up the profitability due to the efforts taken by company.
With major capex in the hotels, foods business, reviving demand in the consumer segment, newer products in the agri-business, and long term positive view on the cigarettes consumption in India, we expect company to drive up its profitability and get re-rated.
We feel investors could buy the stock at the CMP and add on dips to Rs.247-251 band (~22.0x Sept 19E EPS) for sequential targets of Rs. 300 (26.5x Sept 19E EPS) and Rs. 322 (28.5x Sept 19E EPS) over the next 3-4 quarters.
12:45 PM Metals shine
Metal index gained nearly 2% in today's trade with all except 2 constituents trading in green
12:25 PM Rupee check
The Indian rupee fell further since morning, down sharply by 24 paise at Rs 65.35 against the US dolllar, from previous close. The heavy demand for the American currency from importers and banks caused decline in rupee.
Shoppers Stop slips
Shoppers Stop lost 3.3% to Rs 483 on BSE, with the stock sliding on profit booking after Monday's rally triggered by the company's nod to sell 5% of shares to Amazon unit.
11:53 AM Market Check
The benchmark indices extended losses after opening flat tracking Asian peers and global cues. At 11:53 am, the S&P BSE Sensex was trading at 31,467, down 159 points while the broader Nifty50 index was ruling at 9,821, down 50 points.
Prataap Snacks IPO
The Rs 482-crore initial public offering of Prataap Snacks has been oversubscribed 2.8 times, as per latest data available on exchanges.
The issue has received bids for 1.01 crore equity shares against IPO size of 36 lakh shares, excluding anchor investors' portion.
Reliance Securities on Coal India
Buy at Target Price of Rs 301
CIL’s current stock price has discounted decline in e-auction coal prices. Improvement in the policy environment and infrastructure spend coupled with manufacturing activities will aid in reviving the demand environment for the power sector thereby higher coal demand.
We believe that likely improvement in off-take from 2HFY18E onwards and improving e-auction realisations augur well for CIL. Further, as full impact of grade slippage seems to be over in FY17, we believe that the FSA realisations will recover, going forward.
In our view, CIL is a good defensive play with estimated dividend of Rs16/share in FY18, which translates into dividend yield of ~6.2% at CMP.
Power stocks trade mixed after Modi launches Saubhagya scheme
Shares of power companies were trading mixed after the Prime Minister, on Monday, unveiled a flagship programme called “Saubhagya — Pradhan Mantri Sahaj Bijli Har Ghar Yojana” to provide power to all households in the country by December 2018. The Rs 16,320-crore scheme aims at providing “last-mile electricity connectivity to all rural and urban household.
Siemens, Bharat Heavy Electricals, CESE, Reliance Infrastructure and Power Grid Corporation were trading higher by up to 1%, while Tata Power, JSW Energy, NTPC and Adani Power however, quoting 1% lower on BSE. On comparison, the S&P BSE Sensex was down 0.2% at 31,540 points.
MFs step up buying amid market fall
The 'buy on dips' strategy continues to be the mantra of India's equity mutual fund managers. Flush with cash, domestic fund managers continued to be strong buyers, even as foreign institutional investors (FIIs) cashed out. According to statistics available with the Securities and Exchange Board of India (Sebi), fund managers have already pumped over Rs 9,000 crore into stocks so far this month. READ MORE
Emkay Global's top conviction ideas for September
Chambal Fertilisers; BUY; Target Price: Rs 158
Fertiliser segment enjoys higher ROCE at 14-15% compared to the Shipping segment where ROCE is ~5-6%. Due to the huge capex, we expect ROCE to remain depressed over FY18-19, post which it should come back to 15% from FY20E. We assign a BUY rating, valuing the company at 12x FY19E EPS of Rs13.2.
Cholamandalam Finance; ACCUMULATE; Target Price Rs 1,350
Cholamandalam Finance (CIFC) has built a well-diversified and de-risked product portfolio, which has insulated it from the CV downcycle. With 1) growth returning and asset quality improving in Vehicle Finance, 2) low overall Auto Financing market share and 3) expectation of revival in Home Equity (HE; LAP) portfolio post demonetisation, we believe CIFC is better placed than its peers.
Indian Oil; BUY; Target Price: Rs 496
Stable GRM expectation of +US$5/bbl in the next 4-5 quarters, complimented by robust growth in marketed volume by c5.6% yoy in FY18E and stable marketing margin in FY18E will lead to a c36% yoy growth in FY18E EPS. Moreover, ROE should stay healthy at 21% in FY18.
Govt bonds oversubscribed as FPIs bid for $700 mn
Government bonds on Monday received robust response from foreign investors attracting bids to the tune of about $700 million, against $429 million on offer.
The auction was conducted on NSE's e-bid platform from 1530 hours to 1730 hours, after the market hours.
At the end of the two-hour auction, as many as 37 bids were declared successful out of 47, the exchange data showed.
Foreign portfolio investors (FPIs) bid for investment limits in government debt securities worth Rs 4,541 crore ($699 million) as against Rs 2,786 crore ($429 million) on offer.
Click here for full report
Re-rating likely of pharma stocks
The BSE Healthcare index has been one of the biggest gainers over the past few days, on easing of regulatory concerns, improving visibility over product launches and a return of growth in the domestic market.
Ranjit Kapadia of Centrum Broking believes there are encouraging signs which could lead to a re-rating of pharmaceutical stocks, on the back of re-stocking in India and some recovery in the American market.
Earlier, most analysts had thought there would be no revenue growth in the US market for large generic players for at least a year. READ MORE
2017, the year of fewest market corrections
Investors went into a tizzy when the benchmark indices fell less than 2% on Friday, and after the stocks extended the fall by another 1% on Monday. Corrections of this magnitude are considered “business as usual”, but not this year.
So far in 2017, the benchmark Nifty, a gauge tracking the movement of the country’s top 50 stocks, has fallen one per cent or more only on six occasions. READ MORE
BHEL gets shareholders' nod for bonus share, 79% dividend
State-owned power equipment maker BHEL has received shareholders' approval for the proposal to issue 1 new equity bonus share for every 2 existing shares.
The proposal to issue bonus share in the ratio of one bonus share for every 2 existing shares to members was listed on the agenda for annual general meeting held on September 22, 2017, which as passed by the requisite majority, Bharat Heavy Electricals Ltd (BHEL) said in a BSE filing. READ MORE
9:29 AM ONGC-HPCL deal
Oil and Natural Gas Corporation gained 2.19 % post announcement that the company will acquire the government's 51.11% stake in HPCL through a bulk or block deal sometime in November or December at the prevailing market price.
9:27 AM Nifty realty index gained nearly 1% today after falling 3% in yesterday's trade
9:24 AM Sectoral Trend
9:22 AM Top Sensex gainers and losers
9:20 AM Broader Markets
The broader markets were in line with the frontline indices with BSE Smallcap and BSE Midcap trading 0.2% and 0.3% higher respectively
9:19 AM Markets at open
Benchmark indices open flat on Tuesday tracking Asian peers and global developments on backdrop of rising tensions in the Korean peninsula. Sentiment will also remain volatile ahead of the September F&O expiry later this week.
At 9:17 am, the S&P BSE Sensex was trading at 31,672, up 45 points while the broader Nifty50 index was ruling at 9,884, up 12 points
Current: 24,165 (futures: 24,204)
Stop-long positions at 24,100. Stop-short positions at 24,310. Big moves could go till 24,500, 23,900. Support at 24,000-24,050 may be tested again.
Current price: Rs 388.5
Target price: Rs 383
Keep a stop at Rs 392 and go short. Add to the position between Rs 384 and Rs 385. Book profits at Rs 383.
Current price: Rs 165
Target price: Rs 161.5
Keep a stop at Rs 167 and go short. Add to the position between Rs 162 and Rs 163. Book profits at Rs 161.5.
9:11 AM Rupee at lowest level since March
The rupee on Tuesday slid past the 65-mark for the second session in a row as weakness continued in the equity benchmarks. The currency was trading 33 paise lower at Rs 65.12
Key Nifty levels to watch today
For the Nifty 9950, 10027, 10171 are the immediate resistance levels, and 9805, 9738, 9594 are its immediate support levels. For the Sensex 31937, 32247, 32789 are the immediate resistance levels, While 31395, 31163, 30621 are its immediate support levels.
(Source: Zen Research)
Nifty outlook by Prabhudas Lilladher:
The downslide has begun with now Nifty resting at a support of 9,850, a break of this would slide it further down to 9,750-9,600 levels. Nifty needs to cross 9,920 to confirm the end of correction. The support for the day is seen at 9,825 while resistance is seen at 9,920.
Few trading ideas by Prabhudas Lilladher
BUY COAL INDIA
CMP: Rs 257.05
TARGET: Rs 275
STOP LOSS: Rs 245
BUY INDUSIND BANK
CMP: Rs 1,701.70
TARGET: Rs 1845
STOP LOSS: Rs 1,640
BUY BF UTILITIES
CMP: Rs 408.60
TARGET: Rs 452
Chart check: 10,000 level (Nifty) now to act as a hurdle
It is the second consecutive session, when our market witnessed immense selling pressure. During the day, index plunged 144 points due to the broad based sell-off; however, due to some modest recovery in the latter half, Nifty concluded today’s session with a cut of 92 points.
In Nifty options front, we witnessed significant OI addition in 9900-10000 call options, followed by some unwinding in 10200 and 10300 strikes. As a result, highest concentration of OI in call option shifted to 10000 strike price. On the flip side, 9700-9850 put options added some fresh positions; while, good amount of short covering was seen in 10000 and 10100 puts. Thus, maximum open interest in put options remains intact at 9900.
Throughout September series, we witnessed good amount of open interest addition, wherein FIIs were net sellers in index futures. In index options too, they formed bearish bets recently by adding fresh index puts and writing call options. The way options activity has shaped up, we believe 10000-10050 may now act as a strong hurdle. Hence, any bounce back beyond 9900 should be an opportunity to go short on index.
(Source: Angel Broking)
Nifty view by Edelweiss Research
The last two days of decline has been intense with the move accounting for almost 280 points. We believe the current tumultuous phase is the result of a host of factors like weak Q1FY18 earnings, concerns associated with economic growth and geo-political risks. With newsflows of economic stimulus now doing rounds, it is natural for the market participants to become more nervous assessing its impact on the prevailing fiscal situation in the backdrop of weak growth.
Market-wide rollovers at 22%; Nifty rollovers at 20%
Nifty futures rollover stood at 20% which is lower as compared to the average rollovers of 24% of last three series while the market-wide rollovers on the D-3 stood at 22% as compared to the average rollovers of 21% (last three series).
Among the sectors, IT (40%), Telecom (25%) and Auto (23%) have witnessed reasonable rollovers compared to the other sectors on the D-3. High rollovers were seen in GNP (43%), BIOS (36%) and AL (32%). Rollover in Cement (17%) has been relatively weak on the D-3.
Bonanza Wealth Management on Motherson Sumi
Recently, the stock price of Motherson Sumi Systems Ltd. (Motherson Sumi) corrected by ~4% from 52-week high of Rs 350 despite reporting good sets of numbers in the recent quarters.
With one of the largest manufacturers of rear-view mirrors for cars in the world, evolve as a preferred supplier to all its customers, plan to treble its revenue from $5bn in FY15 to $18 billion by FY20E, recently acquired Finland based PKC Group and not witness any material impact of Volkswagen group violating emission norms, we value Motherson Sumi at 38.50x FY19E EPS of Rs.10.60 to arrive at target price of Rs 409.
PM Modi revives Economic Advisory Council with Bibek Debroy as chief
The government on Monday announced setting up an Economic Advisory Council to the Prime Minister (EAC-PM), headed by Debroy.
The Modi government decided to set up the panel to propel the economy, as various parameters are showing signs of weakness amid a resource crunch.
The council will analyse any issue, economic or otherwise, referred to it by the PM, according to its terms of reference. The body, which is an independent council, can also take up the issues suo motu. READ MORE
PM Modi's Rs 16k-cr power push
Setting the bar for higher government spending in the infrastructure sector, Prime Minister Narendra Modi on Monday unveiled a flagship programme called “Saubhagya — Pradhan Mantri Sahaj Bijli Har Ghar Yojana” to provide power to all households in the country by December 2018.
The Rs 16,320-crore scheme aims at providing “last-mile electricity connectivity to all rural and urban households”. READ MORE
Today the markets are likely to open on flat note. All emerging markets are trading mixed. The coming session is likely to witness a range of 9750 on declines and 9950 on advances
(Source: SMC Global)
8:52 AM Oil Check
Crude oil prices gave back some of their gains after soaring more than 3%, with Brent hitting its highest in more than two years. Major producers said the global market was on its way to rebalancing, while Turkey threatened to cut oil flows from Iraq’s Kurdistan region to its ports.
US crude eased 0.2% to $52.12 a barrel, after touching its highest levels since April on Monday.
Brent crude edged up 0.1% to $59.10, after scaling its highest peak overnight since July, 2015.
The Nifty futures on the Singaporean stock exchange were trading lower by around 33 points at 9,850, a dip of around 0.34% indicating a lower start for the Indian markets.
Asian shares slip
Asian shares slumped on Tuesday while the dollar remained off recent highs against the yen against the backdrop of rising tensions on the Korean Peninsula.
MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.2% in early trade, following losses on Wall Street.
Australian shares were up 0.1%, while South Korean shares were 0.3% down.
Japan’s Nikkei stock index sagged 0.2%, pressured by a stronger yen.
8:46 AM North Korea tensions rise
North Korea’s foreign minister said on Monday that a weekend tweet by President Donald Trump counted as a declaration of war on North Korea and that Pyongyang reserved the right to take countermeasures, including shooting down U.S. bombers even if they are not in its air space.
8:46 AM Wall Street ends lower
US stocks closed lower Monday as declines in technology stocks offset gains in energy stocks.
The major US stock indexes recovered some losses in the close. The Dow Jones industrial average closed 53.50 points lower, or 0.24%, at 22,296.09. The Nasdaq composite briefly fell more than 1 percent but closed 0.88% lower at 6,370.59 in its worst day since September 5.
8:44 AM Good Morning and welcome to market's live blog. Catch all the live market action here
First Published: Tue, September 26 2017. 15:35 IST