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After opening higher key equity benchmarks gave up all the gains in late session on profit taking amid fresh selling pressure in automobile, realty, metals, power, telecom and IT sectors.
Sectors such as automobile, IT, realty power, energy. telecom and utilities fell between 0.30% and 1.80% ahead of key macroeconomic data release.
After touching a high of 37,435.15, the 30-share index ended lower by 160.70 points, or 0.43 per cent, at 37,110.12 , while the broader Nifty too was down 59.75 points, or 0.54 per cent, to 10,975.95.
Top performers in Infra sector
Some of the infrastructure companies were trading stronger in Thursday's session.
Shares of IRB Infrastructure Developers (up 8.54 per cent), Suzlon Energy (4.00%), CG Power and Industrial Solutions (up 4.96 per cent) and InterGlobe Aviation (up 3.55 per cent) were the top performers in the index.
Auto shares slide
Among the components of the S&P BSE Auto index, Tata Motors Ltd (down 4.50%), Bosch Ltd (down 3.75%),TVS Motor Company Ltd (down 3.36%),Maruti Suzuki India Ltd (down 3%),Cummins India Ltd (down 2.15%), were the top losers.
Among the other losers were Eicher Motors Ltd (down 1.90%), Ashok Leyland (down 1.80%), Bajaj Auto Ltd (down 2%), Bharat Forge Ltd (down 1.15%), and Hero MotoCorp Ltd (down 0.80%).
Oil & Gas stocks trade lower
Major losers in the BSE Oil & Gas sector were IGL, which was down 3%, GAIL lost 2% and Reliance was down 1.80%
Banking stocks hold firm
Though banking stocks too slid in late trades on profit taking from investors, but the index still managed to end in the green. The BSE Bankex ended higher b;y 42.70 points or 0.40% at 31,258.85.
SBI can be a net beneficiary of RBI’s external benchmarking mechanism
COMMENTS on Banking Sector by YES Securities
The mandatory external benchmarking of lending rates from the coming month for fresh retail and MSME loans would likely weigh on margins of the banks, if not mitigated through a commensurate reduction in the rates on deposits. The latter could be challenging, particularly, for Private Banks who are growing at a faster pace given their stronger capital position and are also operating with a stretched loan/deposit ratio.
SBI, Bank of Baroda and some other PSU Banks who have already announced retail products linked to the repo rate or other external benchmarks are now offering home and auto loans at rates 20-30bps cheaper than before. The competitive landscape would be shaped by how aggressively these products are marketed, given they carry lower margins. But it is more likely that large Private Banks and HFCs who have overlapping customer segments (salaried and borrowers with high credit score) may have to choose between protecting margins or loan growth, till there is systemic improvement in the deposit mobilization. SBI having the stickiest deposit base, significant headroom for improving the C/D ratio and a strong balance sheet could witness a favourable trade-off of gaining meaningful market share with little margin sacrifice
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S & P BSE TECK
Nifty 50 September Futures (11,062): Tread with caution
Both the Sensex and the Nifty began the session with a minor gap-up open taking cues from the positive global markets and started to move sideways. The Asian markets are mixed, the Nikkei 225 is up by 0.7 per cent to 21,759 while Hang Seng index has fallen 0.17 per cent to 27,112 in today's session. The market breadth of the Nifty index is biased towards declines. On the other hand, the India VIX has slumped 3.8 per cent to 14.7 levels.
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Index Outlook: Indices rebound from a significant base
The Sensex and the Nifty remained choppy last week, but key supports provided cushion
Wockhardt can continue to trend upwards
After hitting the upper price band on Wednesday, the stock of Wockhardt (₹338) started today's session with a gap-up open at 301.
A weak month for life insurance as well
After four months of strong growth, private sector individual Annual Premium Equivalent (APE) finally slowed down to 11% y-o-y growth in August 2019 from 18-27% y-o-y growth during April-July 2019. With about 290 bps market share gain for LIC to 44%, the overall industry individual APE growth was higher at 13.9%. HDFC Life, Max Life and Bajaj Life delivered strong growth in individual APE at over 25% y-o-y. ICICI Prudential Life disappointed with decline of 10% yoy, while SBI, Birla and TATA AIA reported modest rise of 13-18% y-o-y.
Private sector individual Annual Premium Equivalent (APE) growth was strong at 11% in August 2019
Private sector players reported 12% growth in overall APE in August 2019, with 11% growth in individual APE. Overall individual industry growth was 14% as LIC’s growth was high at 17.7% as compared to 10.4% in July 2019 and decline in the preceding two months.
ICICI Life disappoints
ICICI Life reported 10% y-o-y decline in individual APE, despite a low base of 6% growth in August 2018. Average ticket size in individual non-single segment was up 2% y-o-y, while most other players have reported higher y-o-y growth. On considering overall (individual and group) adjusted APE including accrued but not received premium, its APE was down 7.8% yoy as compared to 0.9% in July 2019 and 3% in June 2019. Its shift to participating business from ULIPs has likely led to lower volumes and hence this decline.
SBI Life slows down after eight months
SBI Life’s individual APE growth was up 14% yoy in August 2019 (26% YTD), lower than >20% yoy growth observed over the past six months. The overall business momentum picked up since December 2018 with 25-45% yoy growth in individual APE. Growth has, however, started to moderate from peak levels over the past three months. The company has guided about 20-22% growth for FY2020E. As such, overall growth momentum will likely remain moderate from here. The company will continue its focus on protection although yoy growth in protection (up 2X overall APE growth) will be lower in FY2020E (individual protection APE was up 2.5X in 1QFY20; 5X in FY2019).
Max Life remains strong.
Max Life’s growth in individual APE was strong at 28% yoy. The company has increased focus on ULIPs in the past two years although non-par savings business increased significantly in 1QFY20. Its ticket size in individual non-single segment was up by 28% yoy/2% mom. Investment in proprietary channels has led to strong growth in individual business.
HDFC Life moderates a bit
HDFC Life reported strong individual APE growth for a fourth straight month at 35% yoy, albeit lower than strong trends observed over the past three months (31% in April, 59% in May and 87% yoy in June 2019 and 58% in July 2019). This pulled up its overall APE growth to 36%. Average ticket size in individual non-single segment was up 52% yoy (flat mom). Strong momentum in the non-par savings business has been its driver.
Birla SL and Tata slow down
It appears that tables have turned at the bancassurance business of HDFC Bank. While HDFC Life was strong, growth for Birla SL and Tata AIA has been modest. Birla SL and Tata AIA reported 18% and 13% yoy growth, respectively in individual APE. Tata AIA reported 40-125% growth in the preceding four months while Birla SL was up 23-46% in that period.
Source: Kotak Institutional Equities
Demonetisation, faulty GST implementation behind the slowdown, says Manmohan Singh
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Broker's call
ICICI SECURITIES
Astra Zeneca Pharma : Technical call
Strategy
Buy Astra Zeneca Pharma in the range of Rs 1,980.00 – 2080.00 for target price of Rs 2,395.00 with a stop loss of Rs 1,840.00.
Time Frame: Six months
Technical View
The share price has resolved out of the falling channel encompassing past four months entire decline (| 2395 – 1632) underpinned by rising volumes, indicating rejuvenated buying demand that augurs well for acceleration of upward momentum towards | 2395 in coming months
The stock has logged a resolute breakout after finding support from 52 weeks EMA (Rs 1,744) coincided with 61.8% retracement of last major up move (Rs 1,306 – 2,395), placed at Rs 1,722, indicating termination of secondary phase in turn suggesting resumption of primary uptrend.
The slower pace of retracement signifies healthy consolidation as over past four months stock has retraced 61.8% of preceding five months up move (Rs 1,306 – 2,395), signifying robust price structure.
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Tax offences, failure to pay TDS up to Rs 25 lakh not be prosecuted by taxman
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Broker's call
ICICI SECURITIES
Currency Strategy (September 12):
Sell US$INR in range of 71.68-71.72
The dollar-rupee September contract on the NSE was at 71.81 in the previous session. Open interest increased 1.18% in the previous session.
It is expected that the US$INR to find resistance at higher levels. Utilise upsides in the pair to initiate short positions.
Intra-day strategies
Sell US$INR in the range of 71.68-71.72
Positional call from ICICI SECURTIES
₹2153 • TCS: Sell on rallies
Broker's Intraday Technical Calls:
ICICI SECURITIES
Rupee rises 36 paise against dollar
The Indian rupee appreciated by 36 paise to 71.30 against the US dollar in early trade on Thursday as gains in domestic equity market and fresh foreign fund inflows strengthened investor sentiments.
The rupee opened at 69.55 at the interbank forex market.
₹285 • SBI: Buy SBI on dips with fixed stop-loss at ₹277 levels
₹820 • Infosys : Initiate short on rallies with stop-loss at at ₹828 levels
Corporate India’s financial health worsens for the fourth straight month
The credit profile of Indian firms has worsened to a 20-month low, adding pressure on the government to come up with more measures to kick-start a sputtering economy.
File Photo of workers at one of the auto component manufacturing facility in Chennai.
'Nifty Futures Technical call for today
Observation
1) 13 & 21day EMA is placed at 10962 & 10996 levels while 89day EMA and 200day SMA is placed at 11270 and 11219 levels respectively.
2) Directional indicator is below zero line while stochastic is positive and approached to over bought zone.
Expectation
NIFTY will continue to trade higher for the day. Having said so NIFTY is likely to test higher levels such as 11105 – 11115. Previously mentioned resistance zone i.e.11010 would act as immediate support for the day. Any sustainable trade below 11010 we may see mild selling dragging index to lower levels till 10960 – 10950.
Source: Veracity brokerage
Apollo Hospitals extends gains
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Nifty Pre-open session
Asian markets hit six-week high on trade war hopes ahead of ECB
Asian stocks hit a six-week high on Thursday on hopes for a thaw in US-China trade frictions and expectations that the European Central Bank would kick off another wave of monetary easing by global central banks
Day Trading Guide for September 12, 2019
Given below are supports and resistances for Nifty 50 futures and seven key stocks that can help in your intra-day trading:
₹2248 • HDFC Bank
₹820 • Infosys
8.50 am
Today's Pick: Balrampur Chini Mills (₹149.95): Buy
The stock of Balrampur Chini Mills was on limelight on Wednesday. It jumped 12 per cent accompanied by extraordinary volume, breaking above the key resistances
US stocks end in green as China extends olive branch
Wall Street moved higher on Wednesday, led by tariff-sensitive technology and industrial stocks after China extended an olive branch ahead of next month's trade negotiations with the United States.
The S&P 500 closed above the 3,000 mark for the first time since July 30.
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