Indices pare gains; IT stocks buck weak trend

Key indices pared gains and traded near the flat line in early afternoon trade. The Nifty was trading above its crucial 11,800 mark. At 12:30 IST, the barometer index, the S&P BSE Sensex, was up 7.4 points or 0.02% at 40,123.46. The Nifty 50 index was down 21.75 points or 0.18% at 11,818.70.

The broader market was trading flat. The S&P BSE Mid-Cap index was down 0.07%. The S&P BSE Small-Cap index down 0.16%.

The market breadth was titled in favour of sellers. On the BSE, 864 shares rose and 1324 shares fell. A total of 129 shares were unchanged. In Nifty 50 index, 20 stocks advanced while 30 stocks declined.

Domestic Macro:

The Wholesale Price Index (WPI) stood at 0.16% in October 2019 as compared 0.33% in September 2019 and down from 5.28% in October 2018.

The all-India general consumer price index (CPI) inflation jumped to 4.62% in October 2019 (new base 2012=100), compared with 3.99% in September 2019. The corresponding provisional inflation rate for rural area was 4.29% and urban area 5.11% in October 2019 as against 3.24% and 4.78% in September 2019. However, the core CPI inflation eased to 3.44% in October 2019 compared with 3.99% in September 2019.

Derivatives:

The NSE's India VIX, a gauge of market's expectation of volatility over the near term, tumbled 6.39% to 15.4100. The Nifty November 2019 futures were trading at 11,853.50, a premium of 23.45 points compared with the spot at 11,830.05. The November 2019 F&O contracts expire on 28 November 2019.

On the options front, the Nifty option chain for 28 November 2019 expiry showed maximum call open interest (OI) of 21.93 lakh contracts at the 12,000 strike price. Maximum put OI of 21.09 lakh contracts was seen at 11,600 strike price. The option chain indicates that Nifty will stay between 11,600 and 12,000 in November expiry.

Buzzing Index:

Most IT shares bucked weak market trend as the Indian rupee tumbled against the dollar on Thursday, 14 November 2019.

The domestic currency opened at Rs 72.05 against the dollar and dropped to a low of 72.2450 so far during the day. In the spot currency market, the Indian unit was last seen trading at 72.08. On Wednesday, the local unit crashed 62 paise to hit an over two-month low of 72.09 to the US dollar.

The Nifty IT index snapped its three day losing streak and edged higher. The IT index was up 0.63% at 15,337.55.

Infosys (up 2.23%), Hexaware Technologies (up 0.95%), NIIT Technologies (up 0.89%), HCL Technologies (up 0.55%), TCS (up 0.34%) and MindTree (up 0.33%) were top gainers in IT segment.

Stocks in Spotlight:

National Aluminium Company (Nalco) fell 3.79% to Rs 41.85 after the company reported dismal Q2 2019 earnings after market hours yesterday. On consolidated basis, company reported a net loss of Rs 28.25 crore in Q2 September 2019 compared with net profit of Rs 510.55 crore in Q2 September 2018. Consolidated net sales tumbled 22.27% to Rs 2,363.55 crore in Q2 September 2019 over Q2 September 2018.

RITES surged 3.08% after announcing a stellar Q2 September 2019 result after market hours yesterday. The public sector enterprise reported a 112% jump in consolidated profit after tax to Rs 237 crore on YoY basis. Consolidated total revenue rose 85.8% to Rs 888 crore in Q2 2019 over Q2 2018. Consolidated EBITDA jumped 84% to Rs 339 crore in Q2FY19 over Q2FY18. The company's order book as of 30 September 2019 stands at Rs 5833 crore.

IRCON International declined 5.97% to Rs 412 after consolidated net profit fell 4.35% to Rs 82.82 crore on 26.43% increase in net sales to Rs 1,237.36 crore in Q2 September 2019 over Q2 September 2018. During the quarter, the core Earnings before interest, tax, depreciation and amortization (EBITDA) jumped 42.26% to Rs 89.36 crore in Q2 September 2019 as against Rs 62.82 during Q2 September 2018.

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