Vinod Nair, Head of Research, Geojit Financial Services says: Investors showed confidence despite some volatility after the FEDs minutes stating uncertainties over near term rate hikes due to benign inflation. The opportunity from recent correction and the announcement of share buy back from IT major supported the sentiment. Whereas the rising provisions and RBIs concern over inflation in its minutes dragged the banking stocks.
Moody's Investors Service has revised its outlook for the Asian steel industry from negative to stable on an expectation that profitability will remain steady.
"We expect profitability of our rated Asian steel companies – measured by Ebitda (earnings before interest, tax, depreciation and amortisation) per tonne – to remain stable in the next 12 months, following a significant improvement that began in the second half of 2016," said Chris Park, an associate managing director.
The removal of excess steel production capacity in China and the broadly steady steel demand in the region will be the main drivers of this profitability, explained Park.
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3:48 PM Nifty FMCG
The Nifty FMCG index ended the day in red after rising 2.5% in the previous session. Emami, Tata Global Beverages, Godrej Industries and Britannia were the top losers on the index, down between 1-3.5%
3:46 PM Only 4 sectoral indices were trading in green on NSE
3:44 PM Infosys drove gains in the Nifty IT index, which climbed as much as 1.3% in its biggest intraday percentage gain in nearly a month.
3:41 PM Nifty Bank was the top sectoral loser dragged by losses in YES Bank, IndusInd Bank, Punjab National Bank and State Bank of India
3:38 PM Top gainers and losers on Sensex
3:36 PM Broader Markets
In broader markets, the BSE Midcap index underperformed the frontline indices, down 0.3% while the BSE Smallcap index outperformed the indices, up 0.5%
3:34 PM Markets at close
Benchmark indices pared gains to end flat on Thursday dragged by losses in the banking stocks. Index heavyweight Infosys, however, provided some relief to the investors, leading the gains after announcing a likely share buyback.
The S&P BSE Sensex ended at 31,795, up 24 points while the broader Nifty50 index settled at 9,904, up 7 points.
Gold rose for a second consecutive day on Thursday after Federal Reserve officials hinted that US interest rates could rise more slowly than expected, while palladium hit a new 16-year high, supported by strong industrial metals markets.
The minutes of the Fed's July 25-26 policy meeting showed some policymakers wished to halt further rate increases until it is clear the trend of soft inflation is transitory.
Apollo Hospitals hit 34-month low
Apollo Hospitals Enterprise has slipped 7% to Rs 1,069, its lowest level since October 23, 2014 on BSE, in an otherwise firm market.
The National Pharmaceutical Pricing Authority (NPPA) on Wednesday fixed the price for primary knee replacement of titanium alloy at Rs 38,740 while the price for revision knee replacement of any material was pegged at Rs 62,770.
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Oil prices steadied on Thursday after US data showed a big fall in crude stockpiles but also an increase in production, taking US crude output to its highest in more than two years.
Brent crude was unchanged at $50.27 a barrel while US light crude was 5 cents lower at $46.73.
Both benchmarks fell more than 1% on Wednesday.
Energy Information Administration (EIA) data showed commercial US crude stocks have fallen by almost 13% from their peaks in March to 466.5 million barrels. Stocks are now lower than in 2016.
3:01 PM GMR Infra zooms
GMR Infra zoomed nearly 19% intraday on Thursday after a Supreme Court upheld a ruling of the Delhi High Court that allowed Delhi International Airport Ltd (DIAL), a unit of GMR Group, to put airport land to commercial use for non-aeronautical purposes.
2:45 PM The Nifty PSU Bank index, which has lost nearly 9% since India's central bank announced its decision to cut repo rate, erased morning gains to trade in red in afternoon trade. The index was down 0.3% dragged by losses in Bank of India, SBI, Punjab National Bank and Canara Bank.
2:25 PM Europe check
European shares edged lower in early deals on Thursday, set to break their three-day winning streak as banks fell following a set of cautious minutes from the US Federal Reserve, and energy stocks also weighed.
The pan-European STOXX 600 index was down 0.3%, as were euro zone blue chips.
Britain's FTSE 100 fell 0.2%, while Germany's DAX was 0.1% weaker.
SPARC hits 52-week high; stock up 15% in two days
Sun Pharma Advanced Research (SPARC) hit 52-week high of Rs 390, up 5% in intra-day trade, extending its Wednesday’s 10% rally on BSE.
Since July 13, the stock outperformed the market by surging 30% after the company allotted 15.15 million warrants to promoters’ group companies at a price of Rs 330 per share. By comparison, the S&P BSE Sensex was down 0.6% during the same period.
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Cochin Shipyard lines up Rs 2,800-cr expansion projects
After successfully completing its initial public offer (IPO) recently, Cochin Shipyard Ltd (CSL) has lined up expansion projects worth Rs 2,800 crore. The IPO's proceeds will be utilised to fund these expansions.
CSL, which comes under the Ministry of Shipping, was listed on the BSE and the National Stock Exchange last week.
The company has raised Rs 1,442 crore from the IPO, which has been a combination of fresh issue and offer for sale in the ratio of 2:1. The IPO was oversubscribed by over 75 times with more than Rs 1.11 lakh crore being raised against the offer of Rs 1,442 crore.
ITDC surged 13% to Rs 564 on BSE in intra-day trade on back of six-fold jump in trading volumes. A combined 327,103 shares changed hands on the counter on BSE and NSE till 12:27 pm. The stock soared 165% from Rs 213, in 2017, so far. It touched a record high Rs 746 on April 24, in intra-day trade.
As of June 30, 2017, the Government of India holds 87.03% stake in ITDC. Among public shareholders, The Indian Hotels Company has 7.87% holding in the company, the shareholding pattern data shows.
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At 1:15 pm, the Sensex was ruling at 31,892, up 121 points, while the broader Nifty50 was trtading at 9,935, up 38 points.
In broader markets, BSE Midcap pared some gains to turn flat, was trading 0.2% higher while BSE Smallcap outperformed, up 0.8%
Infosys to discuss buyback on 19 August
The announcement has put to rest speculations on the timeline of the buyback. While the quantum and price of buyback is yet to be finalised, management’s earlier figure of Rs 13,000 (including dividend) hints at a much bigger buyback in the offing compared to those done by peers, TCS, HCL Tech and Wipro. For Infosys, the buyback will lead to higher RoE and payout ratio.
We do not perceive this move to be an outcome of lower growth, instead it well means limited possibilities of large acquisitions going ahead, and consistent generation of cash. We maintain ‘BUY’ with a target price of Rs 1,155.
Source: Edelweiss Securities
12:45 PM Buzzing stock
Shares of BEML surged over 8% to hit its lifetime high of Rs 1,879 after the Union Cabinet approved the new metro rail policy. BEML is a pioneer in manufacturing metro and rail coaches.
These 9 steel stocks rallied over 50% in 2017 so far
Shares of steel companies are on a roll with nine companies include Tata Steel, Jindal Stainless Hisar, Welspun Corp, Kalyani Steel, Jindal Saw, Maharashtra Seamless and APL Apollo having rallied over 50% so far in the calendar year 2017. READ MORE HERE
11:44 AM Nifty Bank top sectoral loser
11:20 AM Buzzing stocks
Shares of aviation companies were trading higher for the third straight trading session after they reported a good set of numbers for the April-June quarter (Q1FY18). InterGlobe Aviation, SpiceJet and Jet Airways (India) were up in the range of 1% to 3% on BSE. READ MORE
10:50 AM Buzzing stock
Suven Life Sciences rallied over 5% to Rs 167 after the company secured process patents of new chemical entities for treatment of disorders associated with neurodegenerative diseases in Europe, Japan and New Zealand. CLICK HERE FOR REGULATORY FILING
10:25 AM IMF on China debt
China's massive debt is on a "dangerous" path, raising the risk of a sharp slowdown in growth, the International Monetary Fund (IMF) warned on Tuesday, urging Beijing to speed up structural reforms. READ FULL REPORT HERE
10:17 AM HDFC Bank Ltd., today announced a revision in its Savings Bank interest rate effective August 19, 2017. Post revision, customers maintaining savings bank account balance of Rs. 50 lakh and above will continue to earn interest at 4% per annum. Customers maintaining account balance of below Rs. 50 lakh will earn interest at 3.5% per annum. The revised rates will be applicable to both Resident and Non-resident customers
At 10:00 am, the Sensex was ruling at 31,854, up 83 points, while the broader Nifty50 was trtading at 9,927, up 30 points.
9:56 AM Interview of the day
Tushar Pradhan, chief investment officer at HSBC Asset Management (India), in an interview tells Hamsini Karthik that flows from foreign investors shouldn’t matter much for equities any more. READ FULL INTERVIEW HERE
Tata Power’s target is to take renewable’s proportion to 30-40% of total generation portfolio, which is a key growth driver for it. Also, its endeavour to prune debt, if successful, could be a key trigger for the stock. The stock is trading at 1.6x FY18E and 1.5x FY19E P/BV. We maintain ‘BUY’ with a target price of Rs 87.
Source: Edelweiss Securities
Broader markets outperform
The BSE Midcap and the BSE Smallcap indices added 0.8% each against 0.3% rise in Sensex and Nifty.
9:41 AM Sectoral trend
9:27 AM Top Sensex gainers and losers
9:24 AM Infosys top gainer
Infosys rallied over 3% to Rs 1,010 after the Securities and Exchange Board of India (Sebi) approved its share buyback and also offered a solution for participation by holders of the company’s American Depository Receipts (ADRs) and Global Depository Receipts (GDRs). READ MORE HERE
9:20 AM Markets at open
At 9:18 am, the Sensex was trading at 31,817, up 46 points, while the broader Nifty50 was ruling at 9,912, up 15 points.
Outlook for Nifty Bank (Angel Broking)
Although a minor pullback move in the Nifty Bank index was expected, the velocity of the upmove in the last hour on Wednesday was a surprise to some extent. Though, when the volatility is rising, the directional as well as the corrective moves are usually sharper. The higher degree charts have given some cautious signs and hence, we refrain participating in this pullback move.
The retracement resistance of the recent correction in the Nifty Bank index is seen around 24508. Thus, we advise to keep a wait-and-watch approach and stay light at the current juncture.
Markets buck negative trend seen in global markets in pre-open trade. At 9:05 am, the Sensex was trading at 31,911, up 140 points, while the Nifty50 was ruling at 9,948, up 51 points.
Nomura on trade data
Trade data suggests underlying weakness in both export and import volume growth. We believe this could be due to the supply-chain disruption triggered by transition to the GST regime, while some of the more persistent weakness in labour-intensive export categories (despite steady global demand) could also be on account of loss of competitiveness (due to real effective exchange rate appreciation).
We expect GST disruptions to wane from August and import demand to recover. As a result, we expect India’s current account deficit to widen to 1.4% of GDP in 2017 from 0.6% in 2016
Morgan Stanley on economic outlook
Headline CPI inflation rose by 2.4% YoY in July, up from 1.5% YoY in June, which was higher than consensus expectations of 2.0% and our forecast of 2.2%. The acceleration was largely driven by the pick up in food prices (vegetables and in particular tomatoes) and housing (due to implementation of house rent allowance).
Indeed, on a seasonally adjusted sequential basis, food prices inched up by 1.1% in July from a decline of 0.5% in June. Data confirms that CPI and WPI inflation has troughed in June and should rise further in the coming months, which would limit the space for further aggressive monetary easing.
9:06 AM ALERT: Money markets, banks shut on account of Parsi New Year
Emkay Global on Blue Star
Blue Star (BLSTR) reported a better than expected operational performance for the quarter. While revenues increased by 20% yoy, the EBITDAM declined by 50bps (yoy) and PAT increased by 14% (yoy). While the market for room air conditioners (RAC) remained flat, BLSTR grew by 7% yoy with a gain in market share of 50bps yoy to 11%. In the VRF and inverter AC segments, BLSTR grew by 20% and 24% yoy, respectively. We upgrade FY18E/19 EPS estimates by 4.5% and 4.4% respectively on higher margin assumption. Maintain REDUCE with target price of Rs 624 (SoTP)
Stocks in news
Infosys, Tata Steel, Biocon, YES Bank, Larsen & Toubro, Unitech and Reliance Industries etc
Zinc prices on London Metal Exchange (LME) soared to a 10-year high in yesterday’s trade. Zinc hit above $3,000 per tonne for the first time since October 2007. Zinc prices have gained 15% YTD and are up by around 34% yoy
KNR Constructions has reported yet another strong quarter with Q1 FY18 standalone revenues growing by ~59% yoy on the back of strong execution. We have increased our estimates to incorporate the strong performance. KNR’s standalone EPC business is currently trading at a P/E of 14x FY19E EPS. With the sharp rise in stock price, we downgrade our rating to Accumulate for target price of Rs.237 per share (based on SOTP valuation)
Source: IIFL report
Intraday support for Nifty is seen at 9,840 while resistance at 9,945, says Vaishali Parekh of Prabhudas Lilladher. READ MORE HERE
Technical check on the markets
Nifty closed again in the positive territory as anticipated after forming a “morning star reversal” candlestick pattern. Now, on the upside the Nifty is close to achieve a minimum of 50% retracement target i.e. 9912 levels and above that 9965 which is 61.8% retracement of the entire recent fall from 10137 to 9685 levels. The fall is likely to be a corrective one and this week is expected to be a positive weekly close which will further confirm the same
Source: Anand Rathi Research
The Reserve Bank of India's monetary policy committee (MPC) members said easing consumer inflation had supported the need for a rate cut at its August meeting, but warned prices could start accelerating, minutes showed on Wednesday. READ FULL REPORT HERE
Fed minutes of meet
Federal Reserve policymakers appeared increasingly wary about recent weak inflation and some called for halting interest rate hikes until it was clear the trend was transitory, according to the minutes of the US central bank's last policy meeting.
The readout of the July 25-26 meeting, released on Wednesday, also indicated the Fed was poised to begin reducing its $4.2 trillion portfolio of Treasury bonds and mortgage-backed securities.
8:49 AM Asian markets
Asian stocks edged up on Thursday. MSCI's broadest index of Asia-Pacific shares outside Japan added 0.3% in early trade. Japan's Nikkei slipped 0.1%, weighed down by the yen's strength. South Korean shares advanced 0.1% after the leaders of both North Korea and the United States appeared to back off from their heated rhetoric from last week.
Wall Street on Wednesday
US stocks ended slightly firmer on Wednesday but off the day's highs as worries mounted over President Donald Trump's agenda and minutes from the latest Federal Reserve meeting suggested policymakers are worried about weak inflation.
The Dow Jones Industrial Average rose 25.88 points, or 0.12% to end at 22,024.87, the S&P 500 gained 3.5 points, or 0.14% to 2,468.11 and the Nasdaq Composite added 12.10 points, or 0.19% to 6,345.11.
At 8:45 am, the SGX Nifty, Nifty futures listed on Singapore Stock Exchange, was trading at 9,902, down 6 points or 0.06%.
8:46 AM Good Morning!
Welcome to Business Standard's market live blog.
First Published: Thu, August 17 2017. 15:31 IST