MARKET WRAP: Sensex ends 356 pts lower on RBI rate hike, trade war fears
Among sectoral indices, the Nifty Auto index settled nearly 1.5% down due to a fall in share prices Motherson Sumi Systems and Maruti Suzuki.
 "Photo: Shutterstock.com")
Photo: Shutterstock.com
The benchmark indices ended nearly 1per cent lower on Thursday following the 25 bps hike in repo and reverse repo rates by the Reserve Bank of India (RBI) on Wednesday. That apart, weak global sentiment on account of rising trade war fears also impacted sentiment.
The S&P BSE Sensex ended at 37,165, down 356 points while the broader Nifty50 index settled at 11,245, down 101 points. Among individual stocks, Bharti Airtel settled 3.25 per cent lower at Rs 371.20, while Maruti Suzuki ended 2.15per cent down at Rs 9,140.
The Nifty Auto index settled nearly 1.5 per cent down due to a fall in share prices Motherson Sumi Systems and Maruti Suzuki. The Nifty Realty index ended over 1.5 per cent lower due to Godrej Properties and DLF.
The S&P BSE Sensex ended at 37,165, down 356 points while the broader Nifty50 index settled at 11,245, down 101 points. Among individual stocks, Bharti Airtel settled 3.25 per cent lower at Rs 371.20, while Maruti Suzuki ended 2.15per cent down at Rs 9,140.
The Nifty Auto index settled nearly 1.5 per cent down due to a fall in share prices Motherson Sumi Systems and Maruti Suzuki. The Nifty Realty index ended over 1.5 per cent lower due to Godrej Properties and DLF.
MONETARY POLICY
On Wednesday, the RBI hiked policy rates for the second time in a row on fears of rising inflation rates. Economists now expect the central bank to go in for a prolonged pause and wait to see the impact of the globally evolving scenario. It cautioned that India needed to “run a tight ship” to avoid getting affected by the currency war that had started all over the world. It projected inflation at 4.6 per cent in the second quarter, and 4.8 per cent in the second half of the financial year 2018-19, with risks evenly balanced.
On the other hand, the US Federal Reserve kept interest rates unchanged on Wednesday and characterized the economy as strong, keeping the central bank on track to increase borrowing costs in September. The Fed said economic growth has been rising strongly and the job market has continued to strengthen while inflation has remained near the central bank’s 2 percent target since its last policy meeting in June, when it raised rates.
GLOBAL MARKETS
Asian stocks tumbled on Thursday as the latest escalation in the Sino-US trade war hit Chinese shares, while global bond markets were rattled by increased borrowing by Washington and Japan's new tolerance for higher yields.
Japan's Nikkei declined 1.1 per cent while MSCI's broadest index of Asia-Pacific shares outside Japan dropped 1.5 per cent, dragged down by a 2.2 per cent fall in Chinese H-shares. The CSI 300 index of China's A-shares dropped 3 per cent.
(with wire inputs)
4:32 PM
MARKET COMMENT Jayant Manglik, President, Religare Broking
Markets started on weak note and lost nearly a percent in the end, taking breather after the recent surge. Participants were in the profit taking mood from the beginning, citing weak global markets and overhang of the rate hike further deteriorated the sentiment. Almost all the sectoral indices, barring Pharma, closed lower while broader market indices managed to end on flat note.
We reiterate our "buy on dips" approach in Nifty till 11,100 is intact. Stocks are witnessing volatile swings across the board, thanks to the ongoing earnings season and require extra caution during selection. Private banking counters still top our preferred list along with select stocks from auto, pharma, FMCG space for short term trades. We advise keeping close watch on earnings and cues from the world markets for further clarity
3:47 PM
Stock quote: Maruti Suzuki ends 2.27% lower on NSE
3:45 PM
Nifty Auto index ends 1.44% lower. Top losers:
| COMPANY | LATEST | PREV CLOSE | LOSS() | LOSS(%) |
| MOTHERSON SUMI | 304.10 | 314.60 | -10.50 | -3.34 |
| MARUTI SUZUKI | 9130.05 | 9341.60 | -211.55 | -2.26 |
| APOLLO TYRES | 285.20 | 291.60 | -6.40 | -2.19 |
| M & M | 910.95 | 929.75 | -18.80 | -2.02 |
| TATA MOTORS | 260.25 | 265.05 | -4.80 | -1.81 |
3:42 PM
Nifty sectoral losers of the day
3:40 PM
BSE Sensex: Bharti Airtel, Maruti Suzuki among top losers of the day, Power Grid Corp top gainer
3:37 PM
Markets at close
The S&P BSE Sensex ended at 37,165, down 356 points while the broader Nifty50 index settled at 11,245, down 101 points.
The S&P BSE Sensex ended at 37,165, down 356 points while the broader Nifty50 index settled at 11,245, down 101 points.
3:16 PM
HDFC trades lower for fourth straight day
Shares of Housing Development Finance Corporation (HDFC) was trading lower for the fourth straight trading day, down 2% at Rs 1,933 per share on the BSE. READ MORE
3:03 PM
Gold prices edge higher as dollar eases against yen
Gold prices rose on Thursday, recovering from the previous session's fall, supported by a weaker dollar versus the Japanese yen in Asian trade. Spot gold was up 0.2 per cent at $1,218.23 an ounce, after losing 0.65 per cent in the previous session. US gold futures were little changed at $1,226.70 an ounce. READ MORE
gold
2:49 PM
Sebi wins Australia court case against group accused of financial fraud
Market regulator Securities and Exchange Board of India (Sebi) has won a case against the PACL group in an Australian court. According to sources, the regulator had appealed in Federal Court of Australia to recover dues worth Rs 4 billion stashed away by the PACL Group using several shell entities. READ MORE
2:30 PM
Top losers in BSE 500:
» More on Top Losers
| COMPANY | PRICE() | CHG() | CHG(%) |
|---|---|---|---|
| L&T TECHNOLOGY | 1420.00 | -63.90 | -4.31 |
| ORIENT CEMENT | 115.50 | -5.15 | -4.27 |
| RADICO KHAITAN | 430.05 | -16.00 | -3.59 |
| SONATA SOFTWARE | 342.00 | -12.65 | -3.57 |
| L & T INFOTECH | 1749.55 | -63.15 | -3.48 |
2:16 PM
Pharma shares in focus; Nifty Pharma index hits 6-month high
Shares of pharmaceutical companies were in focus with Nifty Pharma index rising nearly 2% to hit a six-month high on Thursday in otherwise weak market. READ MORE
2:00 PM
Market Check
> More on BSE Indices
| INDEX | LATEST | PREVIOUS | CHANGE | CHANGE(%) |
|---|---|---|---|---|
| BSE SENSEX | 37281.59 | 37521.62 | -240.03 | -0.64 |
| BSE 500 | 15265.88 | 15312.72 | -46.84 | -0.31 |
| BSE MID-CAP | 16104.51 | 16043.12 | 61.39 | 0.38 |
| BSE SMALL-CAP | 16669.00 | 16628.06 | 40.94 | 0.25 |
| S&P BSE LARGECAP | 4381.32 | 4403.28 | -21.96 | -0.50 |
1:44 PM
After RBI policy, what debt investors should bear in mind for portfolios
The Monetary Policy Committee (MPC) of the Reserve Bank of India decided to raise the repo rate by 25 basis points to 6.5 per cent. After two consecutive rate hikes, it is expected that the MPC will pause in October. However, most experts expect the current trend of rising interest rates to continue for at least the next 12-18 months.
Debt fund investors should bear this point in mind when building their portfolios. Investors should steer clear of longer-duration funds and stick to shorter-duration funds. READ MORE
1:34 PM
Devangshu Datta What next for telecom investors
The telecom price war triggered by the launch of Jio has forced drastic consolidation. In effect, three service providers are left. There's a trend of lower ARPU (average revenue per user). Two of the three are suffering falling revenues. All three may be cash-flow negative.
Each must be prepared to spend more. Reliance Jio Infocomm (RJIL), a subsidiary of Reliance Industries (RIL), declared a net profit of Rs 6.12 billion in April-June 2018. Numbers are hard to decode. RJIL has an unusually low rate of depreciation. READ MORE
1:22 PM
Reliance Securities on Tata Motors
We believe that the near-term challenges in terms of profitability and cash flow for JLR to persist, while the Management’s thrust on key six verticals with more emphasis on cash flow and prudent use of fund for capex would result in balance sheet improvement in FY20E.
We maintain our “BUY” recommendation on the stock with a revised SOTP- based Target Price of to Rs325 (from Rs 375 earlier), valuing standalone business at Rs 140, JLR at Rs322 and other subsidiaries at Rs55, based on FY20E EBITDA, post excluding net debt of Rs 192/share.
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First Published: Aug 02 2018 | 8:12 AM IST
