MARKET WRAP: Sensex ends at record closing high, up 282 pts; RIL up 4%

Sensex ended at record closing high on Thursday, driven by gains in financial and energy stocks

3:57 PM

MARKET COMMENT by Gautam Duggad, Head of Research, Motilal Oswal Institutional Equities

 

Sensex crossed all-time high on the back of global cues as well as solid start to earnings season with TCS beating expectations. The divergence between large-caps and mid-caps has widened in 2018 with mid-cap and small-cap indices still down 15-20% from the top. Even within Nifty - select high quality stocks with earnings visibility are driving the index with TCS, HDFC Bank, HUL, Reliance being the key outperformers in YTD CY18.

 

We expect the markets to remain in a tight range albeit with higher volatility in 2018 given the busy political calendar ahead. Our relative preference stays with large caps as midcaps are still trading at premium to largecaps.

 

3:48 PM

RIL settled 4.05% higher at Rs 1,080.90 on the NSE

3:46 PM

Nifty PSU Bank index settles 1.12% higher. Top gainers:

COMPANY	LATEST	PREV CLOSE	GAIN( )	GAIN(%)
BANK OF BARODA	118.80	116.20	2.60	2.24
ST BK OF INDIA	262.05	259.10	2.95	1.14
PUNJAB NATL.BANK	75.85	75.55	0.30	0.40

3:39 PM

Nifty sectoral performers of the day

3:38 PM

BSE Sensex: RIL is top gainer of the day, ending 4.33% higher

3:32 PM

Market at close

 

The S&P BSE Sensex ended at record closing high of 36,548, up 282 points, surpassing previous closing high of 36,283 on January 29, 2018 while the broader Nifty50 index settled at 11,023, up 75 points.

3:13 PM

Tata Power, Vedanta, UPL hit 52-week lows

Shares of Tata Power Company, Vedanta and UPL have hit their respective 52-week lows, falling in the range of 2% to 3% on the BSE in otherwise firm market. READ MORE

3:02 PM

Sector watch: Prabhudas Lilladher on road construction stocks

Road sector stocks have corrected by ~15-20% over last 3 months in spite of all time high order inflow and order book in FY18, our interaction with investor suggest one of apprehension is risk to execution due to reluctance on part of banking sector to lend to road sector (O/s credit to sector coming down YoY since last several months).

 

While political uncertainty might continue to weigh on sector in near term, concerns on execution are over done in our view.  We continue to like players with a strong track record of execution and large balance sheet to support/fund large projects wins. We continue to maintain "BUY" on Sadbhav Engineering and Ashoka Buildcon with price target of Rs 417 and Rs 287, respectively

3:00 PM

Sector-wise FDI flow (Image source: CARE Ratings report)

2:59 PM

Trends in FDI (Image source: CARE Ratings report)

2:59 PM

Ircon stake sale on course; govt plans to raise around Rs 6 billion

 

After the massive response from investors for the initial public offering (IPO) of RITES, the government is set to divest around 10.5 per cent stake in another Railways subsidiary, Ircon International, in September.

 

The government is targeting to raise around Rs 6 billion through the listing of Ircon. On the other hand, the divestment of the government's stake in the other two Railways subsidiaries -- Rail Vikas Nigam Limited (RVNL) and Indian Railway Finance Corporation (IRFC) -- might happen during the October to December quarter of the current financial year. READ MORE

2:45 PM

Sovereign funds cut India investments; share of FPI drops in recent years

 

Some of India’s largest foreign investors are showing signs of increasing reticence. Sovereign wealth funds’ stock market bets were worth Rs 1.5 trillion, according to latest depository data as of May 2018. This is lower than the previous year, and reflects half-a-trillion drop from two years ago.

 

Meanwhile, overall foreign portfolio investments rose by over Rs 7.4 trillion from May 2016. Sovereign wealth funds’ share of foreign investments has dropped to 5.4 per cent in May 2018 from 10.9 per cent share in May 2016. READ MORE

2:30 PM

Sebi not averse to the merger of exchanges, says Chairman Ajay Tyagi

 

Securities and Exchange Board of India (Sebi) chairman Ajay Tyagi on Wednesday said the regulator was not against the merger of exchanges.

 

Speaking on the sidelines of an event organised by Associated Chambers of Commerce and Industry of India (Assocham), he said, “More players are required, but if the economics determine there should be a consolidation, then so be it.” READ MORE

2:15 PM

Analysis: Goodbye inverted yield curve? Fed looks for alternative signals to guide policy

 

Federal Reserve officials are scouring new niches of the financial markets to find signals accurate enough to warn the central bank when it is time to stop hiking interest rates before they risk tipping the economy into a recession.

 

In the run up to previous downturns, the Fed has jacked interest rates to restrictive levels as it sought to temper inflation. This time, the central bank hopes for a softer landing with rates moving just high enough to avoid overheating without ending a nearly decade long expansion. READ MORE

2:03 PM

MARKET COMMENT Hemang Jani, Head - Advisory, Sharekhan by BNP Paribas

Markets are trading at all time high despite lot of headwinds like trade-war tension and  Rupee depreciation. This rally is majorly fuelled by very few stocks like HDFCBANK, Kotak Bank, Reliance, HDFC and TCS however broader market is still not out of woods as nifty Midcap and Small cap index are trading far lower than from all time high level.

Earning season for Q1 F2019 has kicked in with high expectation. TCS and IndusInd bank reported their number which are better than market estimates. Investor should keep eye on this earning season, if this season goes well and earning picks up, then we may see broader rally in markets and market may see higher levels in near future. Investor should be selective in this market as valuation are little stretched and buy those stocks where numbers are good and growth visibility is there

2:02 PM

Market Check

 

S&P BSE Sensex	36,587.38		0.89%
Nifty 50	11,040.85		0.85%
S&P BSE 200	4,724.57		0.54%
Nifty 500	9,392.20		0.51%
S&P BSE Mid-Cap	15,560.70		-0.46%
S&P BSE Small-Cap	16,421.25		-0.05%

1:46 PM

Top gainers in BSE 500:

COMPANY	LATEST	PREV CLOSE	GAIN( )	GAIN(%)
SONATA SOFTWARE	310.10	277.25	32.85	11.85
GMR INFRA.	18.15	17.00	1.15	6.76
TIME TECHNOPLAST	142.65	135.05	7.60	5.63
RELIANCE INDS.	1091.95	1036.35	55.60	5.36
BALRAMPUR CHINI	67.60	64.35	3.25	5.05

1:29 PM

BS SPECIAL Preview: Earnings to rebound in Q1FY19, but momentum may taper off

 

The momentum in consumption demand is likely to sustain in Q1FY19, with strong numbers coming in from Consumer Staples, Durables and Auto sectors. The banking sector credit growth rising to 13 per cent also underscores gradual improvement on the back of increasing retail lending and rising sales growth of companies.

 

The cyclical upturn is largely attributed to higher revenue spending by the government, especially in the rural areas, its multiplier effect on aggregate demand, moderate improvement in global trade, depreciation in INR/USD and rising commodity prices. READ MORE

1:16 PM

Why Donald Trump's policies are making Asian junk investors nervous

Donald Trump has made Asian high-yield investors nervous wrecks. First, there are the obvious casualties of his trade war against China. Lenovo Group Ltd.’s bonds are down to 87.4 cents on the dollar from more than 100 cents at the start of the year. Then there’s the collateral damage of his greenback-boosting, late-cycle fiscal stimulus, which is making investors worried about Asian currency weakness. READ MORE

1:00 PM

WEB EXCLUSIVE After Sensex rally, mid-and small-caps likely to play catch up: Analysts

At a time when the global equity markets have been the pressure of a possible escalation in trade wars, Indian markets have been resilient. Since the recent low of 32,483 levels hit on March 23, 2018 in intra-day deals, the S&P BSE Sensex has climbed nearly 12 per cent to hit a record high of 36,533 on Thursday.

 

Analysts say the up move in the benchmark indices has been on account of a rally in only a clutch of stocks basis the news flow rather than the rally being broad-based. This, they feel, is a cause for concern. In this backdrop, they see a limited upside for the benchmark indices from here on. READ MORE

12:46 PM

Higher revenue share from non-cyclical biz a positive for Ashok Leyland

 

Ashok Leyland Ltd’s (ALL’s) stock has gained over 7 per cent in three trading sessions on robust June quarter volume numbers, value unlocking prospects in the near-term, and expectations of a double-digit truck sales growth over the next three years. The rising proportion of non-cyclical business in overall revenues will keep top line growth steady and less volatile.

 

Analysts at Kotak Securities say recent concerns on slowdown in the truck segment are unwarranted as tonnage growth continues to outpace the rise in volume. READ MORE

12:30 PM

Reliance Industries market cap touches $100-bn mark, stock at record high

Reliance Industries (RIL) market capitalisation (market cap) surpassed the $100 billion mark, after its stock price soaring to a record high of Rs 1,090, up 5% on Thursday on the BSE in intra-day trade. It became the second Indian company to scale the milestone after TCS.

 

At 11:56 am; RIL market cap stood at Rs 6.88 trillion or $ 100 billion mark, the BSE data shows. The stock was quoting at Rs 1,088, up 4.9%. On comparison, the S&P BSE Sensex was up over 1%. READ MORE

12:15 PM

HPCL, BPCL, Jet Airways gain on fall in oil prices

Shares of airlines and oil marketing companies (OMCs) companies were trading higher by up to 5% on the BSE after the Brent Crude recorded its biggest one-day fall in two years on Wednesday.
 

All three listed OMCs, Hindustan Petroleum Corporation (HPCL), Bharat Petroleum Corporation (BPCL) and Indian Oil Corporation (IOC) were up 3% to 5%. Meanwhile Jet Airways (India), SpiceJet, and InterGlobe Aviation, which runs IndiGo were trading higher in the range of 2% to 5% on the BSE. READ MORE

12:00 PM

Markets at Noon

S&P BSE Sensex	36,680.66		1.14%
Nifty 50	11,058.70		1.01%
S&P BSE 200	4,749.96		1.08%
Nifty 500	9,432.70		0.95%
S&P BSE Mid-Cap	15,765.13		0.85%
S&P BSE Small-Cap	16,557.72		0.78%

11:50 AM

NEWS ALERT: RIL touches $100-bn mark. It becomes the second Indian company after TCS to hit $100-bn mark

11:44 AM

L&T gains on order win worth Rs 23.88 billion

 

Larsen & Toubro (L&T) has moved higher by 1.3% at Rs 1,292 on the BSE after the company said its water & effluent treatment business won orders valued Rs 23.88 billion.

 

The orders have been secured from the Madhya Pradesh Jal Nigam Maryadit for the execution of Satna, Kundatiya and Mohanpura multi village rural water supply schemes on turnkey basis. The projects are funded by the New Development Bank, L&T said in a press release. READ MORE

11:30 AM

Prospects rebounding for Crompton Greaves Consumer on govt's rural push

 

After falling from its all-time high of Rs 295 in January to Rs 215 last month, Street sentiment is reviving for Crompton Greaves Consumer Electricals (Crompton). The stock is now figuring among analysts’ picks on expectations that it would gain from the government’s rural push and initiatives.

 

Crompton is among the top five rural players, according to CLSA. Nomura, too, has it among its top picks due to expected gains from growth in the rural economy and infrastructure spending. READ MORE

11:13 AM

Rupee's downslide to continue? Here's what this top forecaster thinks

The Indian rupee’s top forecaster is going against the crowd. The currency will strengthen by the year-end, Emirates NBD PJSC forecasts, bucking a growing consensus that sees it hitting new record lows.

 

The negatives responsible for the rupee’s recent slide -- elevated oil prices and a strong dollar -- have run their course, Aditya Pugalia, Dubai-based director of financial markets at the bank. READ MORE

10:59 AM

Women's wear brand W's IPO next week; shares priced at Rs 714 to Rs 716

Apparel retailer TCNS Clothing will launch its Rs 11-billion initial public offering (IPO) of equity next week, where a clutch of promoters will sale their holdings. The company that owns popular women’s wear brand W has priced its shares at Rs 714 to Rs 716 a share. The 15.7-million share offering will open for subscription on July 18 and close on July 20. The total dilution by promoters will be 25.6 per cent. The IPO will value the company at Rs 44 billion. TCNS Clothing sells its products, which mainly comprises ethnic wear, through 460 rented brand outlets and 1,522 multi-brand outlets. READ MORE

10:46 AM

Sebi-appointed panel considers 'Snapchat model' to boost start-up listings

The Securities and Exchange Board of India (Sebi) is mulling a ‘Snapchat model’ for facilitating listing of Indian start-ups. The multimedia messaging app offered shares without any voting rights during its initial public offering (IPO) last year. READ MORE