The domestic equity market declined on Monday as investors were caution ahead of the Union Budget on 5 July 2019. Concerns of higher crude oil prices and a deficient monsoon in India also affected investors' sentiment.
The key barometer, the S&P BSE Sensex, fell 71.53 points or 0.18% to 39,122.96. The index hit a high of 39,300.02 and a low of 39,021.70 in intraday.
The Nifty 50 index fell 24.45 points or 0.21% to 11,699.65. The index hit a high of 11,754 and a low of 11,670.20 in intraday.
The market breadth was negative. On the BSE, 1058 shares rose and 1455 shares fell. A total of 190 shares were unchanged.
In the broader market, the BSE Mid-Cap index fell 0.32% and the BSE Small-Cap index fell 0.15%.
Among the sectoral indices on the BSE, the S&P BSE Power index (up 0.37%), the S&P BSE Capital Goods index (up 0.29%) and the S&P BSE FMCG index (up 0.19%) outperformed the S&P BSE Sensex. Meanwhile, the S&P BSE Oil & Gas index (down 1.59%), the S&P BSE Metal index (down 1.44%) and the S&P BSE Energy index (down 1.23%) underperformed the S&P BSE Sensex.
Yes Bank (up 1.64%), Mahindra & Mahindra (up 1.47%), TCS (up 1.21%), State Bank of India (up 1.06%) and Indiabulls Housing Finance (up 0.93%) advanced.
JSW Steel (down 3.39%), Eicher Motors (down 3.27%), ONGC (down 3.01%) and Zee Entertainment Enterprises (down 2.07%) declined.
UPL rose 5.15% to Rs 936.40. UPL has fixed 3 July 2019 as the record date for issuing bonus shares. The announcement was made after market hours on Friday, 21 June 2019. The company will issue one bonus equity share for two existing equity shares.
Two-wheeler stocks witnessed selling pressure. Bajaj Auto (down 1.97%), Hero MotorCorp (down 0.77%) and TVS Motors (down 0.62%) declined.
The government is reportedly thinking of a 2023 deadline for three-wheelers and 2025 for all two-wheelers up to 150cc engine capacity to turn electric. Automakers reportedly opposed the proposal and warned that a sudden transition, at a time when auto sales have slumped to a two-decade low, would cause market disruption and job losses.
Most power sector shares declined. Adani Power (down 15.41%), CESC (down 1.74%), Coal India (down 1%), JSW Energy (down 0.49%), Tata Power (down 0.35%), GMR Infrastructure (down 0.32%) and Jaiprakash Power Ventures (down 0.23%) edged lower.
NHPC (up 4.8%), Torrent Power (up 0.96%), Reliance Infrastructure (up 0.71%), Reliance Power (up 0.6%) edged higher.
State-run NTPC rose 0.71%. Power Grid Corporation of India fell 0.35%. NTPC announced signing of a joint venture agreement with Power Grid Corporation of India to incorporate a joint venture company between NTPC and Power Grid with equity participation of 50:50 respectively with an objective to undertake the business for distribution of electricity in distribution circles in various States and Union Territories of India and other related activities. The aforesaid JVC shall be incorporated only after obtaining necessary approvals of the Government. The announcement was made during market hours today, 24 June 2019.
Meanwhile, Fitch Ratings affirmed NTPC's long-term foreign- and local-currency issuer default ratings at 'BBB-'. The outlook is stable.
CG Power and Industrial Solutions rose 1.74%. The company said that its board approved sale of remaining portion of company's land situated at Kanjurmarg, Mumbai currently housing the transformer manufacturing unit admeasuring approximately 13 acres to Evie Real Estate for Rs 498.96 crore and also approved closure/ shifting of the transformer manufacturing unit as a precondition to such sale of land. The announcement was made after market hours on Friday, 21 June 2019.
IT major Infosys fell 0.68%. The shareholders of the company have voted in favor of reappointment of Nandan M. Nilekani as director of the company, at 38th annual general meeting held on 22 June 2019. The announcement was made during market hours today, 24 June 2019.
Infosys announced a long term strategic partnership with Toyota Material Handling Europe (TMHE). As IT services partner, Infosys will help TMHE in its digital transformation journey by facilitating transformation to a scalable digital hybrid cloud platform, providing application services, digital workplace, infrastructure management and a dedicated data center operation. The announcement was made after market hours today, 24 June 2019.
Tata Steel fell 2.33%. Fitch Ratings affirmed the steel maker's long-term issuer default rating (IDR) at 'BB'. The outlook is stable. The affirmation of ratings follows confirmation by the European Commission that it has rejected a proposed joint venture with Thyssenkrupp AG on antitrust concerns.
IndusInd Bank gained 0.83%. As per reports, the Hinduja Group will invest another Rs 2,700 crore into IndusInd Bank through a warrant issue to ramp up the promoter holding after the merger of Bharat Financial Inclusion. The promoters will be subscribing to the warrants at a premium of Rs 1,709 a share, reports added.
Dr. Reddy's Laboratories fell 1.50%. Dr. Reddy's Laboratories informed that the audit of formulations manufacturing plants (Vizag SEZ Plant 1 and Vizag SEZ Plant 2) at Visakhapatnam by the US drug regulator completed on 21 June 2019. The company was issued a Form 483 with two observations. The company said it will address them comprehensively within the stipulated timeline. The announcement was made on Saturday, 22 June 2019.
In a separate announcement made on Saturday, 22 June 2019, Dr. Reddy's Laboratories, along with its subsidiaries, announced the launch of Phytonadione Injectable Emulsion USP, 10 mg/ml single-dose ampules, a therapeutic equivalent generic version of Vitamin K1 (Phytonadione) Injectable Emulsion USP, 10 mg/ml, approved by the US Food and Drug Administration (USFDA).
Neuland Laboratories dropped 0.79%. Neuland Laboratories said that the USFDA inspected the company's manufacturing facility at Hyderabad from 17 to 21 June 2019. The inspection completed with five observations given under form 483. The announcement was made after market hours on Friday, 21 June 2019.
Glenmark Pharmaceuticals fell 7.92%. The company announced on Saturday, 22 June 2019, that the US Food and Drug Administration (USFDA) has issued a complete response letter (CRL) regarding the new drug application for Ryaltris (olopatadine hydrochloride [665 mcg] and mometasone furoate [25 mcg]), nasal spray. The CRL cites deficiencies in the drug master file (DMF) pertaining to one of the active pharmaceutical ingredients (APIs) and in the manufacturing facilities.
The CRL does not specify any deficiencies with the clinical data supporting the new drug application for Ryaltris. The company said that it will be able to resolve these issues within the next 6 to 9 months. Glenmark Pharmaceuticals said it will continue to pursue regulatory approval for Ryaltris and work closely with the FDA to determine the appropriate next steps. Ryaltris is a nasal spray used as a treatment for seasonal allergic rhinitis.
In a separate announcement before market hours today, 24 June 2019, the company said that its Brazilian subsidiary, Glenmark Farmactica a has entered into an exclusive partnership agreement with Novartis Biosciences S.A, a subsidiary of Novartis AG, for three respiratory products indicated towards treatment of the symptoms of chronic obstructive pulmonary disease (COPD) in Brazil. This agreement will be effective from 1 July 2019 onwards. The products involved in the agreement are Seebri (Glycopyrronium bromide), Onbrizee (Indacaterol) and Ultibro (combination of Indacaterol and Glycopyrronium), which are indicated for relief of symptoms in adults with COPD. Under the terms of the agreement, Novartis remains the holder of the registration of these medicines and will be responsible to manufacture them with all technical excellence in line with its global commitment to quality, effectiveness and safety. Glenmark will be responsible for promoting, commercializing and distributing of these products in Brazil.
Larsen & Toubro gained 0.09%. The company announced that its power business arm has bagged a mega engineering, procurement and construction (EPC) order from SJVN Thermal to set up a 2x660 MW ultra-super critical power plant in Buxar district, Bihar. The order falls under Mega category the range for which is greater than 7000 crore as per its classification of contracts. The announcement was made during market hours today, 24 June 2019.
JMC Project (India) rose 1.71%. The company announced that it has secured new orders of Rs 514 crore. The company secured residential and commercial projects in South and West India totalling Rs 295 crore. It bagged factory works from a multinational client in East India of Rs 112 crore. It received institutional building order of Rs 107 crore in East India. The announcement was made during market hours today, 24 June 2019.
Emami fell 7.59% to Rs 267.30 after a huge block deal in early trade today. The company announced after market hours today, 24 June 2019, that the promoters of Emami Group have undertaken a stake sale 10% in Emami for raising approximately Rs 1230 crore. This amount is intended to be used primarily for further reducing debt at the promoter level. The total promoter stake in Emami subsequent to the stake sale stands at a controlling majority of 52.74%.
Housing Development and Infrastructure (HDIL) jumped 13.42%. The company announced allotment of 2 crore equity shares to one of its promoter, Sarang Wadhawan, upon conversion of share warrants. Post transaction, Sarang Wadhawan's stake in HDIL increased from 8.63% to 12.48%. The announcement was made on 22 June 2019.
Rites fell 2.19%. The company said its board recommended issuing one bonus equity share for every four equity shares held. The announcement was made during market hours today, 24 June 2019.
Meanwhile, rainfall in the southwest monsoon season so far this year has been 38% below normal, latest data from the India Meteorological Department showed. The weather department said that India received only 70.9 mm rainfall until 23 June, against a long-period average of 114.2 mm for the period. The southwest monsoon season starts from June 1 officially, and ends on September 30. This year, it reached the Kerala coast on 8 June.
On the economic front, the 35th GST council meeting took place on Friday, 21 June 2019. Altogether 12 agenda items were discussed during the council meeting. The council took a decision regarding location of the State and the Area Benches for the Goods and Services Tax Appellate Tribunal (GSTAT) for various States and the Union Territories with legislature. It has been decided to have a common State Bench for the States of Sikkim, Nagaland, Manipur and Arunachal Pradesh.
The tenure of National Anti-Profiteering Authority has been extended by 2 years. The council also decided to introduce electronic invoicing system in a phase-wise manner for B2B transactions. E-invoicing is a rapidly expanding technology which would help taxpayers in backward integration and automation of tax relevant processes. It would also help tax authorities in combating the menace of tax evasion. The Phase 1 is proposed to be voluntary and it shall be rolled-out from January 2020.
In the commodities market, Brent crude for August 2019 settlement was up 10 cents at $65.30 a barrel. The contract rose 75 cents or, 1.16% to settle at $65.20 a barrel in the previous trading session.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 69.4375, compared with its close of 69.5850 during the previous trading session.
Overseas, most European shares were trading lower. Asian shars closed on a mixed note as investors pinned their hopes on any signs of a thaw in US-China trade negotiations. China's President Xi Jinping will reportedly attend the G20 summit in Japan this week, giving the first official confirmation of his attendance at a gathering where he is expected to meet US President Donald Trump.
US stocks finished lower Friday, 21 June 2019 amid heightened tensions between Iran and the US. US President Trump reportedly said on Sunday he was not seeking war with Tehran after a senior Iranian military commander warned any conflict in the Gulf region could spread uncontrollably and threaten the lives of US troops.
On the data front, US IHS Markit said its flash manufacturing purchasing managers index in June dropped to 50.1 from 50.5 in May. The flash services purchasing managers index in June fell to 50.7 from 50.9.
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