MARKET WRAP: Sensex crashes 505 pts, Nifty at 11,378 on weak global cues

In key stocks, RIL fell over 2.3 per cent, while Sun Pharma cracked over 2.7 per cent. Financial stocks such as HDFC, HDFC Bank, SBI fell up to 2.5 per cent.

4:10 PM

MARKET COMMENT Jayant Manglik, President, Religare Broking

Nifty started the week on feeble note and lost over a percent, mainly pressurised by global cues. It opened gap down and remained under pressure till the end. The news of possibility of further escalation of trade war between the US and China didn't go well with the markets. Also, weakness in rupee further dented the sentiment. Mostly sectoral indices traded in line with the benchmark index and closed lower.

 

Markets are currently dancing to the global tunes and we do not see this changing any time soon. We reiterate our consolidation view in Nifty with bias on the negative side as sustainability seems difficult at higher level. In fact it may witness fresh fall if it fails to hold above 11,300. We advise maintaining balanced approach while trading stocks and keeping positions on both sides

3:42 PM

Nifty FMCG index ends 1.38% lower. Top losers:

COMPANY	LATEST	PREV CLOSE	LOSS( )	LOSS(%)
GODREJ INDS.	576.00	589.75	-13.75	-2.33
UNITED SPIRITS	569.50	581.90	-12.40	-2.13
P & G HYGIENE	9875.75	10060.50	-184.75	-1.84
ITC	302.10	307.15	-5.05	-1.64
EMAMI	547.05	555.70	-8.65	-1.56

3:39 PM

Sectoral losers of the day on the NSE

3:38 PM

BSE Sensex: Sun Pharma, HDFC, RIL among top losers of the day

3:32 PM

Market at close

 

The S&P BSE Sensex ended at 37,586, down 505 points while the broader Nifty50 index settled at 11,378, down 137 points.

3:15 PM

Gold edges up in range-bound trade amid looming US tariffs on China

Gold inched up on Monday as investors looked for short-term gains using the metal's recent narrow trading range, amid increasing Sino-US trade tensions and prospects of further interest rate hikes by the US Federal Reserve.

 

Spot gold was up 0.2 per cent at $1,195.83 an ounce, after falling 0.6 per cent on Friday when it marked its third straight weekly decline. US gold futures were down 0.1 per cent at $1,199.80. READ MORE

2:57 PM

China stocks drop to near four-year low as Trump said to prepare new tariffs

China's main Shanghai Composite index fell to its lowest close in nearly four years on Monday as reports said U.S. President Donald Trump would unveil new tariffs on $200 billion of imported Chinese goods this week.

 

The Shanghai Composite index dropped 1.1 percent to 2,651.79 points, its worst close since Nov. 27, 2014. The blue-chip CSI300 index also declined 1.1 percent, to 3,204.92 points. In Hong Kong, the Hang Seng index was down 1.3 percent in late afternoon trade, and the China Enterprises index was off 1.2 percent. READ MORE

2:42 PM

Oil higher as US Iran sanctions raise supply concerns

Oil prices rose on Monday as investors focused on the impact of U.S. sanctions on Iran despite assurances by Washington that Saudi Arabia, Russia and the United States could together raise output fast enough to offset falling supplies.

Brent crude oil was up 45 cents a barrel at $78.54. US light crude was up 45 cents at $69.44. READ MORE

2:26 PM

IPO Watch

 

Ircon issue subscribed 15% so far on Day 1 of the offer

2:20 PM

Sector watch: NBFCs

India Ratings and Research (Ind-Ra) has maintained a stable outlook for the non-banking financial company (NBFCs) sector and for the major NBFCs rated by it for 2HFY19. NBFCs have continued to increase their market share in the credit domain, as many public sector banks have been placed under the Prompt Corrective Action framework, leading to lending restrictions and NBFCs’ increased ability to structure loans.

 

Ind-Ra expects NBFCs to clock loan growth of 16%-18% yoy in FY19, by continuing their market share gains. In light of rising funding cost, NBFCs have resorted to higher short-term borrowings and have increased focus on higher yielding segments such as used commercial vehicle (CV) financing, unsecured SME loans and small ticket loans against property.

2:14 PM

China Inc's global retreat set to continue despite $17 bn asset selloff

The global retreat by some of China’s biggest and most-indebted conglomerates shows no signs of stopping -- even after more than $17 billion of asset sales.

 

A unit of HNA Group Co. last week missed payments on a 300 million yuan ($44 million) loan, illustrating how the once-acquisitive Chinese company will need to unload more properties and shares to overcome liquidity challenges. And in the U.S. on Friday, Dalian Wanda Group Co. scaled back its bet on movie-theater chain AMC Entertainment Holdings Inc. READ MORE

2:00 PM

MARKET CHECK

Index	Current	Pt. Change	% Change
S&P BSE SENSEX	37,695.87	-394.77	-1.04
S&P BSE SENSEX 50	11,929.28	-111.66	-0.93
S&P BSE SENSEX Next 50	34,452.73	-167.86	-0.48
S&P BSE 100	11,703.95	-101.59	-0.86
S&P BSE Bharat 22 Index	3,620.32	-23.25	-0.64

1:47 PM

Volumes soar at Entertainment Network (India) Ltd counter

Entertainment Network (India) Ltd clocked volume of 2 lakh shares on BSE, a 652.69 times surge over two-week average daily volume of 307 shares. The stock lost 0.07% to Rs.630.00. Volumes stood at 92 shares in the last session. READ MORE

1:31 PM

Here are five reasons why Goldman Sachs downgraded Indian equities

After remaining ‘strategically overweight’ on Indian equities since 2014, global research and brokerage firm Goldman Sachs has cut its India rating to ‘market-weight’ from ‘over-weight’. It expects the markets to consolidate ahead of the general elections and maintains a 12-month Nifty50 target of 12,000.

 

Indian equities, it says, have doubled over the past five years and have outperformed the region by 60 percentage points (pp) in $ terms. “Given the elevated valuations and the recent strong performance, we believe the risk/reward for Indian equities is less favourable at current levels,” wrote Sunil Koul of Goldman Sachs in a recent co-authored report. READ MORE

1:13 PM

Top losers in BSE 500:

COMPANY	PRICE( )	CHG( )	CHG(%)
8K MILES	261.90	-13.75	-4.99
KWALITY	19.50	-1.00	-4.88
ASHOKA BUILDCON	117.45	-5.00	-4.08
REDINGTON INDIA	107.25	-4.50	-4.03
PNC INFRATECH	150.65	-5.25	-3.37

1:01 PM

The IL&FS fiasco represents India's domestic belt and road quicksand

It was as a newspaper-office intern in New Delhi in 1992 that I witnessed the birth of India’s homegrown belt-and-road initiative. The program was midwifed by an up-and-coming lender that few had then heard of: Infrastructure Leasing & Financial Services Ltd.

 

It wasn’t called belt-and-road, a term that would gain currency much later as a catchphrase for China’s opaquely financed global infrastructure ambitions. READ MORE

12:51 PM

COMMENT Navneet Damani- VP- Commodity Research, Motilal Oswal Financial Services

We do not believe that we have hit a similar panic what we have seen in 2013, and see ourselves standing on a much stronger footing this time. However there are some short term headwinds in the form of rising crude oil prices, slippages in Inflation expectations, funds outflow by FPIs and slowdown of flows from FIIs - which has been supporting the currency over the last couple of years, and more importantly the upcoming state and central elections over the next 6 months, which could keep the rupee volatile

12:49 PM

COMMENT Nomura on Asian currencies

We believe the time is right for Asia’s policymakers to start considering a collective, coordinated policy response should the depreciation of currencies in Indonesia, India and the Philippines intensify from here. Twenty years ago, Asia experienced a devastating financial crisis, and an important policy lesson learnt was to be prepared and build strong regional defences instead of being at the mercy of stringent IMF programs.

12:46 PM

Edelweiss on NBCC

We believe HSCC’s acquisition is positive for NBCC—not only will it bolster the latter’s capabilities in the healthcare segment, but would also add about INR100bn to order book. We believe a quick resolution of the tree-cutting issue in the Delhi redevelopment projects and a pickup in real estate monetization remains key triggers for stock performance. We maintain ‘HOLD’ with a target price of Rs 79 (at 22x FY20E EPS).

12:46 PM

Global market pecking order changes in 2018; here's how they stack up

Trade tensions, strengthening US dollar and rising bond yields have rattled most global markets this year. The weakness in equities has changed the pecking order of most-valuable nations in terms of market capitalisation. China and India have seen their ranking decline, while Japan, Canada and Germany have moved up the pecking order. READ MORE

12:39 PM

COMMENT Abhishek Goenka, CEO, IFA Global on rupee

On Friday late evening, Finance minister- Jaitley announced some decisions to stem fall in the Rupee, which includes mandatory hedging conditions for infrastructure loans, permit manufacturing sector entities to avail ECB upto $50 million with a minimum maturity of 1-year vs 3-years, removal of exposure limits of 20 percent of FPI's corporate bond, exemption from withholding tax for issuance of Masala Bond issues done in FY19, and removal of restrictions on Indian banks' market making in Masala Bonds, including restrictions on underwriting of such bonds. The announced measures do not look promising enough to bring in any meaningful inflows nor give any significant relief to the rupee

12:29 PM

Devangshu Datta A sit it out strategy

The bond market has been emitting bearish signals for months. Those signals got stronger as the 10-year government bond (2028) yield touched 8 per cent in early September. This was the highest yield since December 2014. A year ago, the benchmark bond was yielding about 6.5 per cent.

The RBI has since hiked policy rates by 0.5 per cent. The excess in the bond’s yield can be explained by bearish expectations caused by rupee weakness and fears of rising government borrowings. READ MORE

 

12:15 PM

Market expects a special dollar swap facility for oil marketing companies

The need to open a special dollar swap facility for state-owned oil-marketing companies (OMCs) is one of the measures that could be announced in the coming days after discussions with the oil ministry.

 

In such a facility, OMCs will source dollars directly from the Reserve Bank of India (RBI) instead of going to the market. This takes the dollar demand from OMCs out of the foreign exchange (forex) market. They account for a majority of the demand in the forex market. READ MORE

12:00 PM

Markets at Noon

Index	Current	Pt. Change	% Change
S&P BSE SENSEX	37,693.37	-397.27	-1.04
S&P BSE SENSEX 50	11,936.12	-104.82	-0.87
S&P BSE SENSEX Next 50	34,506.39	-114.20	-0.33
S&P BSE 100	11,712.45	-93.09	-0.79
S&P BSE Bharat 22 Index	3,619.55	-24.02	-0.66

(Source: BSE)

11:42 AM

Steps to bring rupee, CAD back on track: FPI move big positive for realty

Foreign portfolio investors (FPIs) in the debt segment are happy that restrictions regarding their investments in corporate debt papers have been lifted. Finance Minister Arun Jaitley on Friday said FPIs can now invest more than 20 per cent of their portfolio in any single company, and at the same time, can invest more than 50 per cent in any single issuance of a corporate paper. READ MORE

11:25 AM

Nifty PSU Bank index falls nearly 2%

11:10 AM

Masala bonds: Investor base to widen; banks can market bonds to NRIs, HNIs

 

With the government and the Reserve Bank of India (RBI) allowing Indian banks to underwrite and market Masala bonds, the investor base for the rupee-denominated bonds is expected to widen. Also, removing withholding tax of 5 per cent for bonds issued this year can see some more than usual issuances, but a flurry of issuance is unlikely. Some regular issuers could issue some more than usual, but in a limited number. READ MORE

10:55 AM

Revamped distribution, portfolio may help these FMCG stocks

 

Prior to the recent correction, fast moving consumer goods companies have been among the best-performing stocks on the back of a recovery in volume growth as well as expectations of an uptick in rural spending.

 

However, within the FMCG pack, four companies–Emami, Tata Global Beverages, Jyothy Laboratories (Jyothy) and Bajaj Corp–have consistently been underperforming on the returns front. READ MORE

10:40 AM

US funds shine as stocks gain and rupee depreciates against dollar

 

International funds putting money in the US markets have got a boost on the back of the sustained uptick in US equities and the depreciation of the Indian rupee against the greenback in the past few weeks. Average category returns for US-focussed funds for the past year has been 31 per cent, with Motilal Oswal Nasdaq 100 ETF emerging the top performer with returns of 41 per cent. READ MORE

10:25 AM

Stock Alert Sugar stocks in sweet spot; surge 20% on hike in ethanol price

Shares of sugar companies climbed as much as 20 per cent in the intraday trade on Monday. Shares of the sector have been on a rising spree after the government last week approved an over 25 per cent hike in the price of ethanol produced directly from sugarcane juice for blending in petrol in a bid to cut surplus sugar production and reduce oil imports. READ MORE