Sensex gains for sixth day in a row

A divergent trend was witnessed as the barometer index, the S&P BSE Sensex, registered small gains and the Nifty 50 index settled with marginal losses. The Sensex rose 36.20 points or 0.14% to settle at 25,880.38. The Nifty 50 index fell 2.70 points or 0.03% to settle at 7,912.05. The Sensex settled below the psychologically important 26,000 mark. The index had surpassed the psychologically important mark in early trade on the back of higher Asian stocks. The Sensex gained for the sixth day in a row. The Nifty snapped a six-day winning streak. With small gains, the Sensex attained its highest closing level in nearly 16 weeks. On the other hand, the Nifty hit its lowest closing level in more than a week.

Stocks of public sector banks edged higher on reports that provisioning for non-performing asset will be lower than anticipated in Q4 March 2016, which in turn could restrict the negative impact on bottom line. IndusInd Bank dropped as sticky loans rose in Q4 March 2016. Chennai-based micro finance lender Equitas Holdings made a strong debut on the bourses.

Wipro tumbled after the company reported weak Q4 results and issued muted revenue growth guidance for Q1 June 2016. Maruti Suzuki India eked out small gains as the Japanese yen eased against the dollar. Bharti Infratel edged lower, with the stock extending losses registered during the previous trading session triggered by media reports that Bharti Airtel will sell more than 5% stake in the telecom tower company through an open market block deal. Stocks of oil exploration and production (E&P) firms edged higher after overnight gains in crude oil prices.

The Sensex rose 36.20 points or 0.14% to settle at 25,880.38, its highest closing level since 1 January 2016. The index gained 235.89 points or 0.91% at the day's high of 26,080.07. The index lost 61.06 points or 0.23% at the day's low of 25,783.12.

The Nifty fell 2.70 points or 0.03% to settle at 7,912.05, its lowest closing level since 13 April 2016. The index rose 63.70 points or 0.8% at the day's high of 7,978.45. The index fell 30.65 points or 0.38% at the day's low of 7,884.10.

The market breadth indicating the overall health of the market was negative. On BSE, 1,495 shares declined and 1,079 shares rose. A total of 158 shares were unchanged. The BSE Mid-Cap index shed 0.5%. The BSE Small-Cap index dropped 0.52%. Both these indices underperformed the Sensex.

The total turnover on BSE amounted to Rs 2798 crore, higher than turnover of Rs 2706.85 crore registered during the previous trading session.

Among the sectoral indices on BSE, the S&P BSE Telecom index (down 0.71%), the S&P BSE Realty index (down 1.47%), the S&P BSE Teck index (down 1.37%), the S&P BSE IT index (down 1.53%), the S&P BSE FMCG index (down 0.83%), the S&P BSE Power index (down 1.09%), the S&P BSE Capital Goods index (down 1.06%),the S&P BSE Basic Materials index (down 1.22%), the S&P BSE Utilities index (down 0.78%), the S&P BSE Industrials index (down 0.44%), and the S&P BSE Consumer Durables index (down 0.98%), the S&P BSE Auto index (down 0.29%),and the S&P BSE Consumer Discretionary Goods & Services index (down 0.86%) underperformed the Sensex.

The S&P BSE Energy index (up 0.78%), the S&P BSE Healthcare index (up 0.36%), the S&P BSE Oil & Gas index (up 0.67%), the S&P BSE Metal index (up 0.38%), the S&P BSE Bankex (up 1.95%), and the S&P BSE Finance index (up 1.23%) outperformed the Sensex.

IT stocks declined. Oracle Financial Services Software (down 1.22%), Tech Mahindra (down 1.7%), Hexaware Technologies (down 0.68%) and MphasiS (down 1.77%) declined. HCL Technologies rose 0.28%.

Wipro tumbled after the company reported weak Q4 results and issued muted revenue growth guidance for Q1 June 2016. The stock lost 7.3%. Wipro's consolidated net profit fell 2% to Rs 2240 crore on 12% rise in gross revenue to Rs 13630 crore in Q4 March 2016 over Q4 March 2015. The results are as per International Financial Reporting Standards (IFRS). The result was announced after market hours yesterday, 20 April 2016.

Revenue from IT services business rose 2.4% to $1,882 million in Q4 March 2016 over Q3 December 2015. On sequential basis, the company expects 1% to 3.02% growth in revenue from IT services business at between $1,901 million to $1,939 million in Q1 June 2016. On an annualized basis, the employee attrition rate dropped to 14.9% in Q4 March 2016 from 16.3% in Q3 December 2015.

Wipro's board of directors approved a proposal to buyback up to 4 crore equity shares of the company for an aggregate amount of up to Rs 2500 crore, being 1.62% of the total paid up equity share capital. The buyback will be through the tender offer route at Rs 625 per share. The promoters of the company have indicated their intention to participate in the proposed buyback.

TCS fell 1.43%. TCS announced the release of a new TCS Intelligent Urban Exchange (IUX) application for Intelligent Water. The new urban analytics application offers pre-built 'use cases' to cost-effectively reduce Non Revenue Water (NRW) loss and ensure delivery of safe, reliable water. The application leverages IUX's scalable analytics platform to allow cities and partners to easily integrate and localize, in order to accelerate the deployment of smart city solutions and enable a future-ready infrastructure for cross domain urban solutions. The announcement was made after market hours yesterday, 20 April 2016.

Index heavyweight and software major Infosys declined 1.63% to Rs 1,223. The stock hit high of Rs 1,250 and low of Rs 1,219 in intraday trade.

Index heavyweight and cigarette major ITC lost 1.7% to Rs 329.30. The stock hit a high of Rs 336.60 and low of Rs 327.50 in intraday trade.

Stocks of public sector banks edged higher on reports that provisioning for non-performing asset will be lower than anticipated in Q4 March 2016, which in turn could restrict the negative impact on bottom line. State Bank of India (SBI) (up 3.68%), Punjab National Bank (up 5.1%), Bank of Baroda (up 3.68%), Andhra Bank (up 2.38%), Canara Bank (up 3.91%), IDBI Bank (up 0.49%), Bank of India (up 2.48%) and Union Bank of India (up 3.78%) gained.

Stocks of private sector banks witnessed mixed trend. ICICI Bank (up 6.26%), Federal Bank (up 4.55%) and Yes Bank (up 0.02%) rose. Kotak Mahindra Bank (down 0.13%) and HDFC Bank (down 0.65%) declined.

As per media reports, the Reserve Bank of India (RBI) has pruned the list of companies whose loans need to be provided for against the risk of default. RBI has informed banks individually that they don't have to provide in the March quarter for outstanding loans to 20 firms, including Jaiprakash Associates and Coastal Energen, out of the 150 it had listed in December. The decision was prompted partly by the steps taken by companies to cut debt, according to reports. Banks were forced to make substantial provisions in the December quarter following an asset quality review (AQR) ordered by the central bank. Due to this, a number of banks reported losses in Q3 December 2015.

Axis Bank gained 2.08% to Rs 467.60 on high volume of 46.96 lakh shares. A large bulk deal of 42.49 lakh shares was executed on the scrip at Rs 466.50 per share at 09:46 IST on BSE.

IndusInd Bank lost 1.46% as sticky loans rose in Q4 March 2016. The bank's net profit rose 25.25% to Rs 620.35 crore on 23.38% growth in total income to Rs 4044.49 crore in Q4 March 2016 over Q4 March 2015. The bank's provisions and contingencies jumped 98.86% to Rs 213.66 crore in Q4 March 2016 over Q4 March 2015. The result was announced during market hours today, 21 April 2016. IndusInd Bank's gross non-performing assets increased to Rs 776.82 crore as on 31 March 2016, from Rs 681.13 crore as on 31 December 2015 and Rs 562.92 crore as on 31 March 2015. The bank's ratio of gross non-performing assets (NPA) to gross advances stood at 0.87% as on 31 March 2016 as against 0.82% as on 31 December 2015 and 0.81% as on 31 March 2015. The bank's ratio of net NPA to net advances stood at 0.36% as on 31 March 2016 as against 0.33% as on 31 December 2015 and 0.31% as on 31 March 2015.

Chennai-based micro finance lender Equitas Holdings made a strong debut on the bourses. The stock settled at Rs 135.25 on BSE, a premium of 22.95% compared with initial public offer price of Rs 110. The stock debuted at Rs 144, a premium of 30.9% to the initial public offer (IPO) price. The stock hit a high of Rs 147 and low of Rs 134.15 in intraday trade. On BSE, 3.08 crore shares were traded on the counter. Equitas Holdings is a diversified financial service provider focused on individuals and micro and small enterprises (MSEs) that are underserved by formal financing channels.

Bharti Infratel fell 3.41% to Rs 373.30, with the stock extending losses registered during the previous trading session triggered by media reports that Bharti Airtel will sell more than 5% stake in the telecom tower company through an open market block deal. Shares of Bharti Infratel fell 2.47% to settle at Rs 386.50 yesterday, 20 April 2016. Bharti Airtel owns a 71.7% stake in Bharti Infratel (as on 31 December 2015). Bharti Airtel plans to use the sale proceeds to cut debt, media reports suggested. The report did not give a timeline for the planned sale.

Shares of Bharti Airtel rose 0.07% to Rs 356.75. The stock was volatile. The stock hit high of Rs 358.60 and low of Rs 351.25 in intraday trade.

Most auto stocks declined. Eicher Motors (down 0.91%), Bajaj Auto (down 1.35%), Ashok Leyland (down 1.53%), Hero MotoCorp (down 2%) and TVS Motor Company (down 3.36%) fell. Tata Motors rose 1.83%.

Mahindra & Mahindra (M&M) declined 1.59%. The company announced that India Ratings and Research (Ind-Ra) has affirmed the long-term issuer rating of M&M at 'IND AAA' with a 'stable' outlook. The rating on its Rs 800 crore non-fund-based bank lines has also been reaffirmed at 'IND A1+'. The announcement was made after market hours yesterday, 20 April 2016.

Car maker Maruti Suzuki India rose 0.72% as Japanese yen eased against the dollar. A weak yen is expected to boost operating margins for Maruti Suzuki India. The company is scheduled to announce its Q4 March 2016 results on 26 April 2016.

Cement stocks declined. Ambuja Cements (down 2.34%), ACC (down 1.98%), UltraTech Cement (down 3.41%) and Shree Cement (down 2.39%) declined.

Grasim Industries was down 2.29% at Rs 3,994.20. Grasim has exposure to the cement sector through its holding in UltraTech Cement.

Stocks of oil exploration and production (E&P) firms edged higher after overnight gains in crude oil prices. ONGC (up 1.72%), Cairn India (up 0.07%) and Oil India (up 0.68%) edged higher. Higher crude oil prices would result in higher realization from crude sales for oil exploration firms.

Index heavyweight Reliance Industries (RIL) gained 0.25% to Rs 1,040.90. The stock hit high of Rs 1,051.50 and low of Rs 1,035 in intraday trade.

In the global commodities markets, Brent for June settlement was currently up 1 cent at $45.81 a barrel. The contract had surged $1.77 a barrel or 4.01% to settle at $45.80 a barrel during the previous trading session after the data from the US Energy Information Administration (EIA) showed a fall in output in the US for a sixth straight week.

Stocks of public sector oil marketing companies (PSU OMCs) also edged higher. BPCL (up 1.35%), HPCL (up 1.29%) and Indian Oil Corporation (up 0.18%) edged higher.

The Sensex rose for the sixth straight trading session. The barometer index has risen 1,206.54 points or 4.88% in six trading sessions from its close of 24,673.84 on 8 April 2016. The Sensex has risen 538.52 points or 2.12% in this month so far (till 21 April 2016). The Sensex has fallen 237.16 points or 0.9% in calendar year 2016 so far (till 21 April 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the Sensex has risen 3,385.77 points or 15.05%. The Sensex is off 2,697.95 points or 9.44% from a 52-week high of 28,578.33 hit on 23 July 2015. The Sensex is off 4,144.36 points or 13.8% from a record high of 30,024.74 hit on 4 March 2015.

In overseas stock markets, European stocks edged lower on caution ahead of monetary policy meeting from the European Central Bank (ECB). The ECB is widely expected to leave monetary policy unchanged after a monetary policy review later in the global day today, 21 April 2016. The ECB is likely to emphasis that it will do everything it can to bring inflation back to target and support economic recovery in the euro zone.

In Asia, Japan and Hong Kong markets led gains. Japanese stocks rose as the yen weakened against the dollar overnight. The Nikkei 225 index settled 2.7% higher. Exporters benefit from a weak currency, which makes their products more competitive overseas. Chinese stocks ended on a mixed note after the nation's central bank announced net cash injection of 220 billion yuan into the financial system in its bid to ease worries about a short-term liquidity squeeze. In mainland China, the Shanghai Composite index settled 0.65% lower. In Hong Kong, the Hang Seng index settled 1.82% higher. US stocks clocked small gains yesterday, 20 April 2016, after upbeat housing data.

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