MARKET WRAP: Sensex up 137 pts, Nifty ends at 10,967 led by PSU banks, FMCG

The Nifty PSU Bank index ended 2.9 per cent higher led by Vijaya Bank and Bank of India after TV reports suggested that Allahabad Bank, Bank of India and Bank of Maharashtra may come out of PCA soon

4:01 PM

MARKET COMMENT Jayant Manglik, President, Religare Broking

 

The bulls continued to dominate as the equity benchmark indices registered seventh straight session of healthy gains, largely led by sharp appreciating rupee (vs USD), declining crude oil prices and supportive global cues. The Nifty index traded on a firm note throughout the session and ended with healthy gains of 0.5% at 10,967 levels. The broader market indices ‘BSE-Midcap’ and ‘BSE-Smallcap’ outperformed the benchmark and closed higher by 1.5% and 1%, respectively. Barring IT, which witnessed selling pressure, all the other sectoral indices witnessed healthy buying with Auto, Realty, Power, FMCG and Oil & Gas being the top gainers in range of 1-3%.

 

We expect some consolidation in the Indian markets at higher levels, due to lack of fresh positive domestic triggers and uncertain global cues. Market participants would keep close watch on the outcome of today’s US Fed meet and also GST meet outcome scheduled on Saturday. Further, movement of crude oil prices, currency and global developments would be tracked. We reiterate our view of maintaining stock specific trading approach and focus more on position management.

3:40 PM

Top sectoral gainers and losers on NSE

3:40 PM

S&P BSE Sensex: Top gainers and losers

3:35 PM

Market at close
 

The S&P BSE Sensex added 137.25 points or 0.38 per cent to settle at 36,484 while NSE’s Nifty50 index closed at 10,967, up 59 points or 0.54 per cent. 

3:23 PM

NEWS ALERT | Allahabad Bank, Bank of India and Bank of Maha may come out of PCA soon, say TV reports; stocks jump up to 10%

3:16 PM

WHERE TO INVEST IN 2019? STOCK IDEAS FROM EPIC RESEARCH

Top 5 stocks which are worth a buy with a time horizon of one year for 2019.

 

 

1.       Federal bank – CMP: 91, Target: 125 – 140, SL: 70

 

The stock is in a bullish trend, longer term, and recent correction in stock is an opportunity to enter the longer term trend hence utilizing the correction for a continuation move. The risk-reward looks favorable at this juncture of price action. 

 

2.       UPL Ltd – CMP: 760, Target: 950, SL: 700

 

The stock has ended its short-term correction on higher timeframe while prices are coming out of the recent correction phase and continue its long term. A positive cross in long-term MA's indicates the strength in trend and we believe it is an opportune moment to create long side position in the stock,

 

3.       Raymond – CMP: 852, Target: 1140, SL: 720

 

A breakout from a declining channel which was almost seen for a year makes stock healthy at current levels. Given its overall formation of higher highs and lows establishes recent trough as a viable support and gives an indication for higher targets of 1140 - 1150.

 

4.       Yes Bank – CMP: 179, Target: 254, SL: 144

 

The stock has corrected a lot from its all-time peaks and has seen the worst correction in the last 8 years since the financial crisis. A long-term established support line coincides with our support level established at 150 levels while a range-bound consolidation in last few weeks indicates a bottoming out formation. Stock can be accumulated with the defined risk of 144 and target of 254.

 

5.       PFC – CMP: 90.5, Target: 135, SL: 65

 

The stock is in a sideways range since last 10 years establishing the lower range as around 70 and higher range around 160. A cyclic analysis makes this stock an investment bet for a year with lower support at 65 acting as a risk and range of 70 - 80 as a buying opportunity for the target of 135.

(All prices in Rs; SL = Stop Loss; CMP = Current Market Price)

3:05 PM

Oil Check

Oil stabilised on Wednesday after one of its biggest falls for years, but remained under pressure from oversupply and concern that a slowing global economy would depress demand for fuel.

 

Benchmark Brent crude oil was up 30 cents at $56.56 a barrel, after dropping 5.6 per cent on Tuesday and at one point hitting a 14-month low. US light crude was 20 cents higher at $46.44, after plunging 7.3 per cent in the previous session when it touched its lowest since August 2017.

2:50 PM

DHFL exits mutual fund industry by selling 50% stake in DHFL Pramerica

 

Dewan Housing Finance Corporation (DHFL) on Tuesday announced that it was exiting from the mutual fund (MF) industry by selling its 50 per cent stake in DHFL Pramerica MF to its joint venture partner Pramerica. READ MORE

2:42 PM

Asian business confidence wallows near 3-year low on trade war worries

 

A very cautious optimism remains among Asian companies in the fourth quarter as they wait to see whether there will be any breakthrough in a trade dispute between the United States and China, a Thomson Reuters/INSEAD survey showed. READ MORE

2:31 PM

NEW ALERT | KEC Int'l bags orders worth Rs 14.91 billion; stock up 2%

2:24 PM

BNP Paribas sets 2019 Sensex target at 40,000, but stays wary on earnings

 

BNP Paribas expects the benchmark Sensex to climb to 40,000 next year, implying a 10 per cent upside from current levels. The France-based investment bank, however, has a neutral stance on the Indian markets as the "earnings environment, unlike the macro-economy, hasn't revived yet". China, South Korea, Indonesia and Thailand are the Asian markets BNP Paribas is overweight on. While it has an underweight stance on Taiwan, Malaysia and the Philippines. Read more

2:10 PM

Capital First, IDFC Bank up 6% on completion of merger

Shares of Capital First (Rs 600) and IDFC Bank (Rs 43.40) were up 6% each on the BSE after these companies informed about the completion of their merger following the receipt of all requisite shareholder and regulatory approvals. The merged entity will be called IDFC First Bank, subject to shareholders’ approval.

In past one week, Capital First and IDFC Bank have rallied 15% each after the National Company Law Tribunal (NCLT) approved their merger. In comparison, the S&P BSE Sensex was up 2% during the same period. Read more

 

1:59 PM

Nifty Realty index is trading 2.76% higher

1:57 PM

Top gainers and losers in S&P BSE Sensex

1:51 PM

Web Exclusive Top eight myths about investing in stock markets and how to overcome them

For a long time, the stock markets were considered to be a club for the wealthy and the enterprising. That emanated from the old wisdom that gentlemen preferred bonds. There are a lot more flexible and even small retail investors feel a lot more comfortable. Understanding how to invest in share markets is all about dispelling popular myths about share markets. Myths are, typically, based on half-baked knowledge and incorrect understanding of the nuances of the share market. Here are eight such myths which you need to dispel before investing in equities. Read more

1:51 PM

MARKET COMMENT Credit Suisse Wealth Management on outlook for 2019

We expect the global economic growth cycle to extend further in 2019, albeit at a slower pace than in 2018. Although we remain positive on emerging markets (EMs), we expect moderate returns from Indian equities in 2019, given the market’s valuation gap with other EMs and a potentially weak mandate for the new government next year. We suggest that long-term investors look beyond any election-led volatility and rather focus on corporate fundamentals to build portfolios as corporate earnings growth is likely to accelerate

 

1:18 PM

Neither oil, nor elections, the US Fed holds most sway over India's stocks

For all the domestic drivers of India’s stocks -- from oil to elections to shadow banking shakeouts -- the U.S. Federal Reserve holds the most sway, according to the nation’s biggest money manager.

 

Sankaran Naren, who helps manage 3.1 trillion rupees ($44 billion) as chief investment officer at ICICI Prudential Asset Management Co., says investors need to brace for a run of constrained returns that will last until the Fed’s Jerome Powell makes a policy U-turn. READ MORE

1:02 PM

BNP Paribas sets 2019 Sensex target at 40,000, but stays wary on earnings

BNP Paribas expects the benchmark Sensex to climb to 40,000 next year, implying a 10 per cent upside from current levels. The France-based investment bank, however, has a neutral stance on the Indian markets as the "earnings environment, unlike the macro-economy, hasn't revived yet". China, South Korea, Indonesia and Thailand are the Asian markets BNP Paribas is overweight on. While it has an underweight stance on Taiwan, Malaysia and the Philippines. READ MORE

12:47 PM

HDFC twins, ICICI Bank, L&T among 26 stocks near record highs

Shares of Housing Development Finance Corporation (HDFC), HDFC Bank, ICICI Bank, Larsen & Toubro (L&T), Havells India and Marico are among 26 stocks that were trading close to their respective record high levels on BSE. READ MORE

12:32 PM

Top contributors in S&P BSE Sensex

COMPANY	LATEST	CHG(RS)	CHG(%)	FREE FLOAT MKT CAP (RS CR)	CONTRIBUTION (POINTS)
ITC	280.30	2.30	0.83	340413.78	24.94
H D F C	1969.20	16.05	0.82	335805.07	24.12
AXIS BANK	633.70	13.95	2.25	119452.16	23.81
ST BK OF INDIA	298.50	5.95	2.03	109657.46	19.75
ICICI BANK	365.55	3.20	0.88	233357.03	18.24

12:22 PM

Cement shares in focus; India Cements, Orient Cement up 5%

 

Shares of cement companies rallied by up to 13% on BSE in early morning trade on the expectations of higher demand going forward due to higher investments in infrastructure and affordable housing projects. The fall in coal/pet-coke and diesel prices from their peak is expected to benefit the companies in the forthcoming quarter. Further, busy season surcharge withdrawal and axle load norms relaxation will benefit the cement players going forward. Read more

12:13 PM

Web Exclusive OBC, Canara Bank: Two PSU bank stocks that look bullish on the charts

 

The Nifty PSU Bank index had consolidated around its 100-day moving average (DMA) located near 2,966 – 2,960 levels before crossing the high (3,050) of Symmetrical Triangle as per the daily chart pattern. Earlier, the index had witnessed selling pressure above 3,000 levels, as it could not close strongly as per chart. However, this time around all major moving averages, 200-DMA and 50-DMA are supportive of upside. That said, the index faces resistance at 3,150 and 3,240 levels. Read more
 

12:02 PM

Market check

Index	Current	Pt. Change	% Change
S&P BSE SENSEX	36,443.34	+96.26	+0.26
S&P BSE SENSEX 50	11,464.19	+40.73	+0.36
S&P BSE SENSEX Next 50	33,195.64	+518.18	+1.59
S&P BSE 100	11,251.90	+60.49	+0.54
S&P BSE Bharat 22 Index	3,496.43	+32.47	+0.94

11:53 AM

Motilal Oswal on State Bank of India

 

RATING: Buy

CMP: Rs 293

Target Price: Rs 360

 

State Bank of India's asset quality is clearly showing recovery signs, as is evident in the declining size of the watch-list (around 1% of advances) and lower slippages from the core corporate pool. We expect slippages to moderate further in 2HFY19, while the resolution of stressed power assets remains an important event to watch for in the near term (66% of power assets are rated A- or above). We conservatively expect RoA/RoE to improve to 0.7%/13.3% by FY21, respectively. Maintain Buy with a revised target price of Rs 360 (1.2x Sep20E ABV for the bank + Rs 79 per share for the subsidiaries).

 

11:43 AM

Equirus Securities on Alembic Pharmaceuticals

 

Our analysis of Alembic’s (ALPM) US pipeline suggests that 

(a) the near-term pipeline is weak and majorly commoditized, 

(b) filings from newly-built facilities of oncology, injectables, dermatology and ophthalmic are yet to pick up, and 

(c) key niche launches are lined up only towards FY20/FY21-end. A weak pipeline, long gestation periods for newly-build facilities, along with receding tailwinds from high-value Valsartan revenues indicate pressures and muted return ratios for ALPM in the near-to-mid term.

 

At current valuations (22x/25x FY19E/FY20E P/E), the stock fully factors in the company’s near-to-mid term pipeline, leading us to assign a SHORT rating (REDUCE earlier) with a Mar’20 TP of Rs 514 (Rs 536 earlier) set at 21x P/E.

11:29 AM

RCom falls 12% on reports DoT has rejected its spectrum deal with Jio

 

Shares of Reliance Communications (RCom) fell as much as 12 per cent to Rs 13.77 apiece on BSE in the intra-day trade on Wednesday after a news report suggested that the Department of Telecommunications (DoT) on Tuesday, told RCom and Reliance Jio Infocomm that it can’t approve their spectrum deal to trade airwaves as it does not adhere to its guidelines. Read more

11:17 AM

Here's why New Delhi can't afford NBFCs to stumble even accidentally

Why do you call them shadow banks? That’s a criticism I’ve heard often since I started chronicling the troubled world of India’s nonbank finance companies following the high-profile bust of infrastructure lender IL&FS Group in early September.

 

Some readers saw the characterization as an attempt to equate India’s pedigreed financiers of mortgages and consumer loans with China’s peer-to-peer lenders and trust companies, which saw scorching growth but are now gasping for survival. READ MORE

11:06 AM

Here're the top losers on BSE

Security	LTP (₹)	Change	% Change
RCOM	14.63	-1.15	-7.29
RNAVAL	14.50	-0.68	-4.48
ABB	1,300.65	-35.25	-2.64
INFY	662.70	-13.65	-2.02
HCLTECH	966.20	-19.20	-1.95

10:57 AM

UPL faces near-term growth headwinds over European concerns, Arysta buy 

 

European sales have been sluggish for most of this year and after completion of the acquisition of Arysta, its dependence on Europe is expected to increase. The region contributed about 24 per cent to UPL’s sales in 2017-18. READ MORE

10:45 AM

Equirus Securities on Persistent Systems

 

The company is navigating technology and business shifts using software 4.0 methodology that brings together the tools, techniques and processes to build a software-driven business. The company is also focusing on three industries – Financial Services (FSI), Healthcare & Life Sciences and Industrial IoT (IIoT) – and has built multiple solutions and accelerators which could help win & mine customers and markets. A combination of seasonality (anticipated better 2HFY19e), reasonable valuations, and potential capital allocation strategy leads to an upgrade to LONG from ADD. Our Mar’20 target price (TP) of Rs 687 (Rs 634 earlier) is set at a 13x (12x) Mar’20 TTM EPS of Rs 52.0. Potential capital allocation strategy leads to an increase in price-to-earnings ratio (PER) by a turn.