Sensex ends 587 points lower amid weak global cues; Nifty nosedives 178 points

Investors cautious after CEA virtually ruled out a stimulus package for the government

4.00 pm

Closing bell

Benchmark equity index Sensex plummeted 587 points, pressured by heavy selling in banking and energy stocks amid weak global cues. Investor sentiment also tanked after Chief Economic Adviser Krishnamurthy Subramanian virtually ruled out a stimulus package from the government.

The 30-share Sensex sank 587.44 points, or 1.59 per cent, to 36,472.93. It hit an intra-day low of 36,391.35 and a high of 37,087.58. The broader NSE Nifty ended 177.35 points, or 1.62 per cent, down at 10,741.35. During the day, it plunged to a low of 10,718.30 and touched a high of 10,908.25.

Yes Bank was the biggest laggard in the Sensex pack, plummeting 13.91 per cent, followed by Vedanta, Bajaj Finance and Tata Motors, which declined up to 7.76 per cent. ONGC, SBI, Hero MotoCorp, ICICI Bank, Tata Steel, HDFC twins and RIL also ended in the red.

Tech Mahindra, TCS, HUL and HCL Tech were the only gainers, spurting up to 1.57 per cent.

According to traders, Chief Economic Adviser Subramanian’s comments practically ruling out a stimulus package for the economy weighed on investor sentiment. “If we basically expect the government to use taxpayers’ money to intervene every time when there are some ‘sunsets’, then I think you introduce possible moral hazards from ‘too big to fail’ and as well as the possibility of a situation where profits are private and losses are socialised,” Subramanian said at an event.

Globally, markets were jittery ahead of comments from Federal Reserve Chair Jerome Powell at Jackson Hole, Wyoming, US. Elsewhere in Asia, Shanghai Composite Index and Nikkei ended on a positive note, while Hang Seng and Kospi settled in the red. Equities in Europe were trading lower in their respective early sessions.

Meanwhile, the Indian rupee depreciated 33 paise to 71.88 against the US dollar intra-day. Brent crude futures, the global oil benchmark, rose 0.65 per cent to USD 60.69 per barrel.

3.40 pm

Gold ETFs

Total known ETF holdings expanded to 2,424.9 tonnes on Wednesday, the highest since 2013   -  Bloomberg

 

Gold has surged this year as investors seek protection from slowing global growth, the incessant trade war, and turmoil in the bond market that suggests the US may be headed for another recession. Total known ETF holdings expanded to 2,424.9 tonnes on Wednesday, the highest since 2013, following inflows over the past three years and a continued build-up in 2019. Click here to read more on the gold ETFs holdings and gold rally

3.25 pm

Cotton futures

 

Cotton futures in domestic market continued their gaining streak on Wednesday for sixth straight session. Cotton August future at MCX gained by 0.4 per cent on Wednesday to settle at Rs 21,270 a bale. Cotton futures at MCX have rallied persistently since first week of August. Here's more on the cotton futures

3.10 pm

European markets

Germany's DAX shrugged off a weak open, to trade 0.1 per cent higher. File Photo   -  Reuters

 

European shares traded close to flat as upbeat surveys on Germany and the euro zone offset signs that US policymakers had not intended to start a cycle of interest rate cuts with last month's move.

Germany's DAX shrugged off a weak open, to trade 0.1 per cent higher. Italy reversed earlier losses after Reuters reported President Sergio Mattarella wanted clear signs of a possible deal to form a new government by the end of the day. Read the European stock markets report here

2.55 pm

IndRa revises BHEL outlook

BHEL’s management is hopeful of a significantly higher sales booking in December and March quarters. File Photo   -  The Hindu

 

India Ratings and Research has revised the outlook on Bharat Heavy Electricals Ltd (BHEL) to negative from stable due to higher than expected decline in its revenue, leading to EBITDA losses in 1QFY20.

The rating agency expects further moderation in September quarter. However, BHEL’s management is hopeful of a significantly higher sales booking in December and March quarters, thus meeting the management revenue targets. Click here to read more on IndRa's outlook on BHEL

Shares of BHEL was trading marginally up by 0.10 per cent at ₹48.35 close to its 52 week low of ₹47.45 at 1.20 pm.

2.40 pm

Lupin to divest its Japanese injectables biz

Drug major Lupin on Thursday said it will divest its Japanese injectables business to neo ALA Co Ltd, a wholly-owned subsidiary of Abu Dhabi-headquartered Neopharma group. Lupin has entered into a definitive agreement through its Japanese subsidiary Kyowa for the said deal.

Lupin to divest its Japanese injectables biz to Neopharma group

Drug major Lupin on Thursday said it will divest its Japanese injectables business to neo ALA Co Ltd, a wholly-owned subsidiary of Abu ...

Read More  

2.25 pm

Sensex falls over 300 points; Nifty over 1%

The 30-share BSE index Sensex slumped 346.43 points or 0.93 per cent to 36,713.94 amid weak Asian cues ahead of the US Federal Reserve chairman's speech. Meanwhile the 50-share NSE index plunges 115.05 points or 1.05 per cent to 10,803.65.

 

Global stock markets flatlined as uncertainty over the outlook for US interest rate cuts following the release of minutes from the Federal Reserve's last policy meeting kept investors on edge.

Minutes of the Fed's July meeting showed deep splits among policymakers over whether to cut interest rates last month, though there was some unity in wanting to signal it was not on a preset path to looser policy.

Euro zone business growth expectations also fell to their weakest in more than six years on trade war fears, even as the expansion picked up a touch in August. - With inputs from Reuters

2.10 pm

Alphalogic Techsys IPO

Pune-based boutique software consulting firm Alphalogic Techsys’ Rs 6.18 crore Initial Public Offering (IPO) will open on August 23 and close on August 27.

The company, which intends to list on September 5, is set to become the first company to be listed on BSE start-up platform. Finshore Management Services is the book-running lead manager to the issue, the company said in a statement.

1.55 pm

Opinion | The wait for a plan to revive the economy

Union Budget This year missed the mark

 

The political blame game can go on, but the issue before business and the economy is, how to get out of the economic mess that the NDA-II appears to have landed us in.

NDA-II has not been sitting idle. It has taken a number of initiatives for which it can take well-deserved credit. It has initiated an insolvency and bankruptcy code which has the chance to break the back of bank NPAs. It has taken big strides in bringing sense and clarity to the laws governing the labour market, and raised the threshold for initiating and pursuing tax litigation at various levels. But still, the NDA-I’s phase-II is not widely credited with an ability to get the economy out of the current doldrums. Read our Opinion by Subir Roy on how to revive the economy

1.40 pm

CG Power continue to tumble

Shares of CG Power and Industrial Solutions continued to remain locked in the lower circuit for third consecutive day, tumbling nearly 10 per cent on Thursday amid concerns over alleged financial irregularities in the company.

Gautam Thapar-promoted CG Power and Industrial Solutions on Tuesday said an investigation by its board found major governance and financial lapses, including advances to related and unrelated parties as well as liabilities of the company and the group potentially being understated by hundreds of crores of rupees. Here's more on the stock activity of CG Power and Yes Bank

1.25 pm

Broker's call

Chola Securities

Arvind (Buy)

CMP: ₹48.3

Target: ₹63

In 1QFY20, consolidated revenue grew a modest 4.8 per cent y-o-y to ₹1,890 crore. Revenue growth was lead by 31 per cent y-o-y growth in advance material business segment and 4 per cent y-o-y growth in textiles business segment. Here's our Broker's call on Arvind

1.10 pm

Forex market

 

China's yuan fell to an 11-year low against the dollar due to worries about an economic slowdown, prompting Chinese state-owned banks to support the currency in the forwards market.

The yuan's fall, combined with declines in Hong Kong stocks on concerns about protests in the city, pushed the antipodean dollars lower and boosted the yen against major crosses in so-called risk-off trades. Read the forex market report here

12.55 pm

Sensex, Nifty trade lower

The 30-share BSE index Sensex was trading lower by 175.15 points or 0.47 per cent at 36,885.22 while the broader index Nifty was trading 77.35 points or 0.71 per cent lower at 10,841.35.

The top losers in the Sensex pack were Yes Bank, Vedanta, IndusInd Bank, Reliance and ICICI Bank while the gainers were TCS, Hindustan Unilever, Tech Mahindra, HCL Technologies and ITC.

In the 50-share index, major gainers cushioning the index were Britannia, Dr Reddy's, TCS, Hindustan Unilever, and GAIL while the laggards were Yes Bank, IBUL Housing Finance, Coal India, Vedanta and UPL.

12.40 pm

Gold and precious metals

US gold futures were down 0.4% at $1,510.10 an ounce. File Photo   -  Reuters

 

Gold prices were little changed on Thursday, holding above the key $1,500 an ounce level, as investors awaited the Federal Reserve chair's speech at a global central bankers' conclave for clues on future US interest rate cuts. Spot gold inched down 0.1 per cent to $1,500.14 per ounce by 0426 GMT. US gold futures were down 0.4 per cent at $1,510.10 an ounce.

Markets are now focused on Powell's speech at Jackson Hole on Friday, for clarity on the direction of US monetary policy. Read the gold and other precious metals prices and bullion market here

12.25 pm

Supreme Court notice to DLF, SEBI

An adverse decision by the Court could seriously impact DLF investors

 

The Supreme Court has issued a notice to real estate developer DLF based on a petition that highlighted how DLF had suppressed key information regarding judicial proceedings against its largest chunk of land-bank in Haryana. A notice has also been issued to SEBI, which too is party to the case. Click here to read more on the Supreme Court notice issued to DLF and SEBI and on the non-disclosures

The stocks of DLF were dropped 12.59 per cent to Rs 150.

12.10 pm

Yes Bank shares may fall

 

Shares of Yes Bank Ltd fall as much as 7.34 per cent to ₹60.6, lowest since March 3, 2014. The stock is likely to fall into a range of ₹52.38 to ₹47.01, as suggested by its technical chart. More on the stock activity of Yes Bank, read here

11.55 am

Sensex, Nifty continue to fall

The 30-share BSE index Sensex slumped 255.39 points or 0.61 per cent to 36,834.98 and the broader index Nifty was trading lower 0.64 per cent or 69.80 points at 11,848.90. The indices were let down by the bank and financial stocks.

The top gainers in the Sensex pack were Hindustan Unilever, TCS, ITC, Tata Steel and Maruti while the laggards were Yes Bank, Vedanta, HDFC, IndusInd Bank and Hero MotoCorp. Among the sectoral indices, the stocks of realty sector was biggest loser trading lower by 5.40 per cent.

In the NSE index, the stocks leading the positive zone were Britannia, Dr Reddy's, Hindustan Unilever, TCS and ITC while the top losers were IBUL Housing Finance, Yes Bank, UPL, Bajaj Finserv and Vedanta.

11.40 am

Commodities market

US refined product stocks build higher than expected. File Photo   -  Reuters

 

Oil prices slipped, paring earlier gains, weighed down by lingering worries about the global economy and bigger-than-expected builds in oil product inventories in the United States, the world's biggest oil consumer. US gasoline and distillate stockpiles rose more than expected last week, while crude inventories fell as refineries hiked production, the Energy Information Administration said. Read more on the commodities market here

11.25 am

US markets

The S&P 500 posted 31 new 52-week highs and five new lows. File Photo   -  Bloomberg

 

Wall Street's main indexes rose on Wednesday as upbeat earnings from retailers pointed to strength in US consumer demand, and held gains after minutes from last month's Federal Reserve meeting showed policymakers had debated a more aggressive interest rate cut. Concerns about an economic slowdown rose as the yield curve between 2-year and 10-year Treasuries briefly inverted last week. Click here to read more on the US stock markets report

11.10 am

Shares slip as stimulus news awaited

Shares fell as investors fretted over the chances of a fiscal stimulus and anxiously awaited the US Federal Reserve chairman's speech later this week for clues on future rate cuts.

Real estate stocks were among the top losers, with the Nifty real estate index shedding 7.2 per cent, its biggest intra-day dip since late 2016, as DLF Ltd slumped 19.6 per cent.

A report in the Hindu BusinessLine newspaper said the Supreme Court had issued a notice to the real estate developer for allegedly suppressing material information from shareholders.

The broader NSE index was down 0.79 per cent or 86.10 points at 10,832.60, while the benchmark BSE index was lower by 228.06 points or 0.62 per cent at 36,832.31.

The minutes of the Fed's July meeting showed policymakers deeply divided over rate cuts, while hopes for a fiscal stimulus dimmed as President Donald Trump said he was not looking at cutting payroll taxes. Much now depends on how dovish Fed Chair Jerome Powell chooses to be in his speech on Friday.

MSCI's broadest index of Asia-Pacific shares outside Japan was down about 0.35%.

Meanwhile, markets awaited news on an economic stimulus from the government amid a bruising slowdown that has hammered industries including the crucial automotive sector, leading to production cuts and job losses. “The disappointment factor is increasing day by day, because we've not heard anything from the government,” said Rusmik Oza, head of fundamental research at Kotak Securities in Mumbai. ”Earnings have also been a big disappointment.”

June-quarter net profits for India Inc grew at a moderate pace of 6.6 per cent year-over-year, compared with 24.6 per cent a year earlier, CARE Ratings said on Wednesday, based on an analysis of 2,976 companies.

The Nifty metals index fell 2.13 per cent, with miner Vedanta Ltd declining 3.9 per cent. The Nifty FMCG index, which tracks manufacturers of fast-moving consumer goods, was the lone gainer with a rise of 1.17 per cent. - Retuers

10.55 am

Rupee market

At the interbank foreign exchange, the rupee opened weak at 71.65.   -  The Hindu

 

The rupee opened on a weak note and fell 17 paise to 71.71 against the US dollar in early trade amid foreign fund outflows and cautious opening in domestic equities. Traders said cautious opening in domestic equities and foreign fund outflows weighed on the local unit, while weakening of the greenback vis-a-vis some currencies overseas and easing crude oil prices added support to the local unit. Read the local currency market here

10.40 am

SEBI relaxes FPI norms

SEBI overhauls FPI norms   -  istock

 

Markets watchdog SEBI relaxed compliance requirements for foreign portfolio investors, tweaked norms to boost startups and decided on a ₹1 crore reward for informants in insider-trading cases. In a significant move, the watchdog decided to simplify Know Your Client (KYC) requirements for foreign portfolio investors (FPIs) as well as broad-based criteria for them. Click here to read more on the SEBI's new FPI norms

10.25 am

Sensex drops below 37,000 mark

Domestic equity benchmark BSE Sensex dropped over 100 points to fall below the 37,000 mark tracking weak cues from other Asian markets amid concerns of a looming global economic slowdown.

The 30-share index was trading 149.03 points, or 0.40 per cent, lower at 36,911.34. The broader Nifty too fell 52.75 points, or 0.48 per cent, to 10,865.95 in morning trade.

In the previous session, the 30-share Sensex settled 267.64 points, or 0.72 per cent, lower at 37,060.37. The broader NSE Nifty too ended 98.30 points, or 0.89 per cent, down at 10,918.70.

Top laggards in the Sensex pack included Vedanta, Yes Bank, Bajaj Finance, IndusInd Bank, ONGC, Tata Steel, Sun Pharma, HDFC Bank and SBI, which fell up to 3 per cent. While ITC, L&T, HUL, Kotak Bank, TCS and TechM rose up to 1.37 per cent.

Foreign portfolio investors sold shares worth a net of Rs 770.81 crore Wednesday, and domestic institutional investors too purchased shares worth Rs 353.97 crore, provisional data showed.

Besides continued fear of a global economic slowdown, investors are also jittery ahead of the Jackson Hole Symposium, scheduled to begin later in the day, traders said.

The rupee, meanwhile, depreciated 10 paise against its previous close to trade at 71.66 in early session.

Elsewhere in Asia, bourses in Hong Kong, Korea, Shanghai and Japan were trading on a negative note in their respective late morning sessions. While, exchanges on Wall Street ended in the green on Wednesday. Global oil benchmark Brent crude was trading 0.17 per cent lower at 60.20 per barrel. - PTI

10.10 am

Global markets

People pass stock index tickers at the Singapore Exchange (SGX) premises (file photo)   -  Reuters

 

Asian shares went flat as uncertainty over the outlook for both US interest rates and the chance of global fiscal stimulus sucked the life out of markets. Moves were minuscule, with MSCI's broadest index of Asia-Pacific shares outside Japan off 0.2 per cent in very light volumes. Read the global stock markets report here

9.55 am

Nifty falls below 10,900 mark

The 30-share BSE index Sensex, after opening marginally higher, slipped 146.70 points or 0.40 per cent to 36,913.67, dragged majorly by bank and financial stocks. Meanwhile, the broader index Nifty fell to 10,876.10 points, lower by 42.60 points or 0.39 per cent.

 

The stocks lending support to the Sensex were ITC, Hindustan Unilever, L&T, Tech Mahindra and TCS while the laggards were Yes Bank, Vedanta, Bajaj Finance, IndusInd Bank and ONGC.

Sectorally, the realty stocks emerged biggest laggard trading lower by 6.88 per cent. Capital goods stock index were alone trading in positive zone.

In the NSE index, the scrips cushioning the index were Britannia, Dr Reddy's, ITC, UPL, and Hindustan Unilever while the top losers were IBUL Housing Finance, Yes Bank, Vedanta, Bajaj Finserv and JSW Steel.

9.40 am

Are P-Notes staging a comeback?

 

On Wednesday, markets regulator SEBI said: “...requirements for issuance and subscription of offshore derivative instruments (ODIs) have been rationalised.” Legal experts expressed surprise at the move to rationalise ODI norms as the instruments are no longer widely used. This can only mean that SEBI was in favour of their revival in a controlled manner, experts said. Click here to read more on the SEBI's move on ODI norms

9.25 am

Stocks in focus

Shares of Lactose (India) are likely to remain in focus, as the company has re-paid the entire loan amount of ₹43 crore obtained from Piramal Housing and Capital Finance. The company took ₹41 crore as term loan facility and ₹2 crore as working capital facility. The term loan facility agreement was signed in 2017 while the working capital facility agreement was entered into in March 20. Shareholders and analysts of Lactose will closely monitor further developments.

Shares of Swelect Energy Systems will turn ex-bonus on Thursday. The company is rewarding its shareholders with one bonus share for every two held (1:2). The board of directors had fixed August 23 as the record date for determining the members eligible to receive the bonus shares. The company said the bonus shares will be credited or dispatched to the shareholders on or before September 5. In 2009, Swelect Energy had issued one bonus share for each share held (1:1).

The board of directors of Gillette India is scheduled to meet on Thursday to consider and approve audited financial results and statements for the financial year ended June 30, 2019 and to consider recommendation of dividend (if any). The board of Supreme Infrastructure India will also meet on Thursday to approve the financial results for the quarter and year ended March 31, 2019. Shareholders of these companies will closely analyse the performance charts.

9.15 am

Opening bell

The 30-share BSE index Sensex opened 27.21 points higher at 37,087.58 against the previous close of 37,060.37. Briefly after, the index slipped into negative, trading lower by 90 points. The 50-share NSE index Nifty opened 15.70 points lower at 10,903 against the previous close of 10,918.70.

9.10 am

Day Trading Guide

Given below are supports and resistances for Nifty 50 futures and seven key stocks that can help in your intra-day trading:

₹2226 • HDFC Bank

S1

S2

R1

R2

COMMENT

2210

2195

2240

2255

Consider initiating fresh long positions with a fixed stop-loss only if the stock moves above ₹2,240 levels

 

₹799 • Infosys

S1

S2

R1

R2

COMMENT

792

785

807

814

Near-term stance is bullish for the stock of Infosys. Buy in declines with a stop-loss at ₹792 levels

 

₹241 • ITC

S1

S2

R1

R2

COMMENT

238

235

244

247

Initiate fresh short positions with a stiff stop-loss if the stock fails to rally above ₹244 levels

 

₹121 • ONGC

S1

S2

R1

R2

COMMENT

118

115

124

127

Fresh long positions can be initiated with a fixed stop-loss only if the stock rebounds from ₹118 levels

 

₹1270 • Reliance Ind.

S1

S2

R1

R2

COMMENT

1255

1240

1285

1300

Initiate fresh long positions with a tight stop-loss only if the stock of RIL advances above ₹1,285 levels

 

₹277 • SBI

S1

S2

R1

R2

COMMENT

274

269

281

286

Fresh long positions are recommended with a tight stop-loss only if the stock of SBI moves beyond ₹281 levels

 

₹2185 • TCS

S1

S2

R1

R2

COMMENT

2165

2145

2205

2225

Consider initiating fresh short positions with a stiff stop-loss if the stock falls below ₹2,165 levels

 

10932 • Nifty 50 Futures

S1

S2

R1

R2

COMMENT

10870

10830

10980

11030

Initiate fresh long positions with a tight stop-loss only if the contract manages to rally above 10,980 levels

 

S1, S2 : Support 1 & 2; R1, R2: Resistance 1 & 2.

9.00 am

Today's Pick

 

We recommend a buy n in the stock of Den Networks at the current levels of Rs 81.4. Since finding support at ₹45.5 in early June this year, the stock has been in a medium-term uptrend. Also, the short-term trend is up.

With a minor pause at current levels, the stock has potential to trend upwards and reach the price targets of ₹85 and ₹87 in the ensuing trading sessions. Read our stock recommendation and stock activity of Den Networks here

Published on August 22, 2019