Sensex recovers to close up 168 points at 39,784

Nifty gains 52 points or 0.44% to finish at 11,922

 

June 10 | 3.30 pm

Closing bell

The benchmark indices finished Monday's session up nearly 0.5 per cent. The Sensex closed at 39,784, up 168 points or 0.43 per cent firmer, while the Nifty ended at 11,922, up 52 points or 0.44 per cent higher.

The top gainers on the Sensex were TCS, Bharti Airtel, Infosys, HCL Tech and ITC, while the laggards were YES Bank, Tata Motors, ONGC, Coal India and Hero MotoCorp.

Among the BSE sectoral indices, the top gainers were the IT index which gained 1.78 per cent, followed by the technology index (up 1.61 per cent), FMCG (1.10 per cent) and capital goods (0.74 per cent).

The oil and gas index dropped 1.20 per cent during the day.

June 10 | 3:02 pm

Sensex, Nifty reverse downtrend

The benchmark indices, the Sensex and the Nifty, halted the downtrend to edge up in late session on Monday.

The Sensex recouped some of its morning gains to quote at 39,747, up 131 points or 0.33 per cent higher. The Nifty was trading at 11,913, up 42 points or 0.36 per cent firmer on its Friday close.

Earlier in the day, the benchmark indices rallied to hold gains of more than 0.50 per cent.

The top gainers on the Sensex were TCS, Infosys, Bharti Airtel, Power Grid and ITC, while the laggards were YES Bank, ONGC, Coal India, Tata Motors and Kotak Bank.

IT and technology indices shot up more than 1.5 per cent on the BSE, followed by FMCG, telecom, capital goods and consumer durables. The major losers on the exchange were oil and gas, down 1.39 per cent, and energy, which was down 0.61 per cent.

June 10 | 2:55 pm

Gold off 14-month peak as US-Mexico deal cools safe-haven demand

Representative image   -  Getty Images/iStockphoto

 

Gold prices skidded 1  per cent on Monday, retreating from a 14-month peak hit in the previous session after an agreement between the US and Mexico to avert a tariff war crimped safe-haven demand for the metal.

Spot gold was down 1  per cent at $1,327.32 per ounce, as of 0725 GMT. In the previous session, the bullion hit its highest since April 19, 2018 at $1,348.08 an ounce. US gold futures also fell 1  per cent, to $1,332.10 an ounce. Click here to read in full the gold markets report.

June 10 | 2:40 pm

Reliance Power shares plunge nearly 24% post Q4 results

 

Shares of Reliance Powertumbled nearly 24 per cent on Monday after the company reported a loss of ₹ 3,558.51 crore for the quarter ended March 31. The scrip plunged 23.66 per cent to ₹ 4.71 -- its 52-week low -- on the BSE. At NSE, shares of the company cracked 21.13 per cent to hit a one-year low of ₹ 4.85.

Anil Ambani Group firm Reliance Power on Sunday reported a loss of ₹ 3,558.51 crore for the quarter ended March 31, 2019 as against a net profit of Rs 189.21 crore in the year-ago period. Click here to read in full the Reliance Power share price movement report.

June 10 | 2:30 pm

European shares gain on Mexico tariff relief

European shares rose on Monday as strong export data out of China and the reaching of a deal between the US and Mexico provided some relief to markets worried by the impact of US President Donald Trump's aggressive trade bargaining.

Helping the European auto sector were signs that Fiat Chrysler Automobiles NV and Renault SA were looking for ways to resuscitate their collapsed merger plan and secure the approval of Nissan Motor Co. Click here to read in full the European share markets report.

June 10 | 2:20 pm

Benchmark indices edge lower

The benchmark indices pared most of their morning gains in the afternoon session on Monday.

The Sensex was trading at 39,639, up 23 points or 0.06 per cent higher on its Friday close, while the Nifty was at 11,887, up 16 points or 0.14 per cent higher.

The top gainers on the Sensex were TCS, Infosys, Power Grid, Larsen & Toubro and ITC, while the laggards were YES Bank, Tata Motors, ONGC, Coal India and Kotak Bank.

June 10 | 2:10 pm

Nifty call: Go long on rally above 11,925 levels with fixed stop-loss

 

Nifty 50 June futures (11,915)

The Sensex and the Nifty began the session with a gap-up open, taking positive cues from the Asian markets. But the benchmark indices started to decline witnessing selling pressure at higher levels. The Asian indices, the Nikkei 225, has gained 1.5 per cent to 21,134 and the Hang Seng index has jumped 2.4 per cent to 27,600 levels. Click here to read in full the Nifty call report.

June 10 | 2:00 pm

Peso surges on US-Mexico deal, euro sags

 

The Mexican peso surged more than 2 per cent on Monday after the US and Mexico struck a deal on migration to avert a trade tariff war, supporting a rebound in investor risk appetite that boosted the dollar and knocked the safe-haven yen lower.

Foreign exchange investors had rushed for the safety of the Japanese yen in recent weeks after US President Donald Trump's threat to slap tariffs on Mexico shook investor confidence. Click here to read in full the global forex markets report.

June 10 | 1:50 pm

Oil rises on supply cuts, but weak economy holds market back

File photo   -  REUTERS

 

Oil prices rose on Monday after Saudi Arabia said producer club OPEC and Russia should restrict supplies to current levels, while Washington's withdrawal of a tariff threat against Mexico removed a cloud over the global economy.

However, traders said concerns about the health of the global economy and the impact on fuel demand were still weighing on oil market sentiment. Click here to read in full the global oil markets report.

June 10 | 1:30 pm

Maharashtra farmers to defy ban, sow GM brinjal and cotton seeds

 

Shetkari Sanghatana, a farmers’ body in Maharashtra, said on Sunday it would sow seeds of genetically modified (GM) brinjal and cotton in a village in Akola district on Monday as a mark of protest against the government’s ban on GM crops.

Around 5,000 farmers under the aegis of the organisation are expected to gather in Akoli Jahangir village to plant the transgenic varieties, its State president Anil Ghanwat said. Click here to read in full the report on Maharashtra farmers to defy ban by sowing GM brinjal and cotton.

June 10 | 1: 20 pm

RBI’s new prudential framework for stressed asset resolution credit positive: Moody’s

 

Moody’s Investors Service on Monday said the Reserve Bank’s new prudential framework for stressed asset resolution is ‘credit positive’, but flagged the slower-than-expected progress of resolution under Insolvency and Bankruptcy Code as a key hurdle. Click here to read the full report on Moody's credit positive assessment of RBI's prudential framework for NPAs.

June 10 | 1:10 pm

Eros International to buy back shares worth up to $20 mn in US market

 

The board of media and entertainment firm Eros International on Monday announced a share repurchase program worth up to $ 20 million (approx Rs 138.86 crore) on the New York Stock Exchange.

The announcement comes after Credit Analysis and Research Limited (CARE), last Wednesday, downgraded the ratings assigned to the bank facilities of Eros International’s Indian arm Eros International Media on account of a delay in servicing of bank loans for the month of April 2019 and May 2019. Click here to read the full report on Eros Intl share buyback in US market.

 

June 10 | 12:30 pm

Sensex, Nifty drop lower at mid-session

The benchmark indices, which opened firm and traded in positive territory in the morning session, gave up part of their early gains by mid-session on Monday. The Sensex was quoting at 39,703, up 87 points or 0.22 per cent, while the Nifty dropped to 11,900, representing a gain of 29 points or 0.25 per cent higher on Friday's close.

The top gainers on the Sensex were TCS, Infosys, Tata Steel, HCL Tech and Power Grid, while the laggards were YES Bank, Tata Motors, Coal India, Kotak Bank and Hero MotoCorp.

On the BSE, the IT and technology indices were up more than 1 per cent. The FMCG, telecom, power and capital goods shares also posted healthy gains. The oil and gas index dropped over per cent during the session. Other major losers were realty, energy, finance and banking shares.

June 10 | 12:25 pm

Asian shares gain as US shelves plan to impose tariffs on Mexico

sian shares, European and US stock futures rose on Monday after the US shelved plans to impose tariffs on Mexico and as global investors hoped for lower US interest rates on the back of lacklustre jobs data.

Global investors had feared that opening up another trade conflict, while still battling with China, could tip the US and other economies into recession. The Mexican peso rallied more than 2 per cent on Monday.

But in China, the yuan slipped to its weakest this year after the country's imports fell the most in nearly three years and as talks to end the Sino-US dispute remained deadlocked. Click here to read in full the Asian markets report.

June 10 | 11:58 am

Jammu and Kashmir Bank plunges after top boss' exit

Shares of Jammu and Kashmir Bank Ltd slumped by 20 per cent daily limit, the biggest intra-day percentage drop in over five years.

The lender on Saturday said Parvez Ahmed had ceased to be chairman & chief executive officer of the bank.

The bank today received approval from the central bank to appoint R.K. Chhibber as interim chairman and managing director.

Media reports said Ahmed was sacked following allegations of offences, including nepotism and corruption. The J&K anti-corruption bureau is probing the allegations, reports say. J&K Bank and Ahmed were not immediately available for comment.

The stock has touched its lowest level since March 18 at Rs 47.55. Over 5.9 million shares changed hands versus the 30-day average of about 1.1 million shares. - Reuters

June 10 | 11:40 am

Gold off 14-month peak as US-Mexico deal cools safe-haven demand

Representative image   -  Getty Images/iStockphoto

 

Gold prices retreated from a 14-month peak on Monday after an agreement between the US and Mexico to avert a tariff war crimped safe-haven demand for the yellow metal.

Spot gold was down 0.9 per cent at $1,328.08 per ounce, as of 0530 GMT. In the previous session, bullion hit its highest since April 19, 2018 at $1,348.08 an ounce. US gold futures fell 1 per cent to $1332.20 an ounce. Click here to read the full gold markets report.

June 10 | 11:25 am

Eros International Media slumps after report on parent company

Shares of Eros International Media plunged by 10 per cent daily limit, hitting a record low of Rs 40.95. Short seller Hindenburg Research in a report alleges potential wrongdoing at parent Eros International Plc.

Ratings agencies categorise Eros International Media's debt at default levels. Eros International Media says it has “taken steps to rectify delays” in loan payments. Click here to read in full the Eros International Media share price movement report.

June 10 | 11:10 am

J&K Bank gets RBI nod to appoint R.K. Chhibber as interim CMD

Jammu & Kashmir Bank on Monday told the exchanges that it has received the Reserve Bank of India's approval for the appointment of R. K. Chhibber as interim Chairman & Managing Director (CMD) of the bank for a period of three months with effect from June 10, 2019.

On Saturday, the bank intimated the exchanges that Chhibber has been nominated by the state government as Director on its board and may be further appointed as interim CMD. The board of directors, pursuant to the government order and subject to RBI approval, appointed him to the position with effect from June 8.

Simultaneously, the state government order said Parvez Ahmed, CMD, would cease to be Director on the Board of Directors of the bank and consequently be no longer the CMD of the board.

The bank's share was trading at Rs 51.30 apiece at 1053 hours, down 13.71 per cent.

June 10 | 10:55 am

Sensex, Nifty extend gains

The benchmark indices the BSE Sensex and the NSE Nifty extended their early gains by mid-morning trade on Monday. The Sensex was trading at 39,897, up 281 points or 0.71 per cent, while the Nifty was at 11,949, up 78 points or 0.66 per cent.

The top gainers on the Sensex were Tata Steel, PowerGrid, TCS, Infosys and Hindustan Unilever, while the laggards were led by Kotak Mahindra, YES Bank, HDFC, Tata Motors and Coal India.

IT shares were the top gainers on the BSE, spurting up 1.52 per cent. They were followed by power and FMCG indices, which were up 1.17 per cent and telecom shares, which were up 1.01 per cent. The capital good, consumer durables and metals indices were also up over 0.90 per cent. The oil and gas index was the only one in negative territory.

PTI adds: The Sensex rallied over 350 points and the NSE Nifty reclaimed the 11,900 level in early trade driven by gains in IT and banking stocks amid positive global and domestic cues.

In the previous session on Friday, the Sensex settled 86.18 points, or 0.22 per cent, higher at 39,615.90. Similarly, the broader NSE Nifty rose 26.90 points, or 0.23 per cent, to 11,870.65.

Investors took positive cues from other Asian markets, which were trading positive amid easing global trade war concerns after the US dropped its threat to impose tariffs on Mexico.

Bourses in China, Japan and Korea were trading up to 2 per cent higher in their respective early sessions.

According to experts, the expectations of a normal monsoon and strong revival in earnings growth in FY20/FY21 driven by turnaround in corporate banks and healthy growth in construction/infra companies would provide support to markets at higher levels.

On the currency front, the rupee appreciated marginally to 69.43 against the US dollar.

Brent crude futures, the global oil benchmark, were trading 0.52 per cent higher at 63.62 per barrel.

Meanwhile, foreign institutional investors sold equity worth Rs 478.84 crore on Friday, while domestic institutional investors purchased shares to the tune of Rs 179.79 crore, provisional data available with stock exchanges showed.

June 10 | 10:45 am

Turnover threshold likely to be ₹50 cr for B2B e-invoices to curb GST evasion

 

The Finance Ministry is likely to propose a turnover threshold of ₹50 crore to generate e-invoice on a centralised government portal for business-to-business (B2B) sales to curb GST evasion, an official said. Click here to read in full the report on likely turnover threshold for B2B e-invoices.

June 10 | 10:40 am

Oil prices rise on likelihood of ongoing OPEC+ supply cuts

 

Oil prices rose on Monday after Saudi Arabia said producer club OPEC and Russia were likely to keep withholding supplies, and in relief that the United States and Mexico averted a trade war that would have damaged the global economy. Click here to read in full the global oil markets report.

June 10 | 10:35 am

Mexican peso jumps after Donald Trump calls off tariffs on Mexico

 

The Mexican peso jumped against the dollar early in Asia on Monday after the United States and Mexico struck a migration deal late last week to avert a tariff war, providing much-needed relief to fragile market sentiment.

Over the past year, trade disputes between the United States and its trading partners, including a long-running conflict with China, have slowed global growth and unsettled financial markets. Click here to read in full the global forex markets report.

June 10 | 10:30 am

Stocks gain as Mexico tariffs averted, yuan falls to 2019 lows

 

US stock futures and Asian shares rose on Monday after the United States dropped its threat to impose tariffs on Mexico in a deal to combat illegal migration from Central America, and as weak US jobs data raised hopes for US interest rate cuts. Click here to read in full the Asian share markets report.

June 10 | 10:25 am

Rupee rises 8 paise to 69.38 versus dollar in early trade

The rupee opened strong at 69.78 at the interbank forex market. File Photo   -  BusinessLine

 

The rupee appreciated by 8 paise to 69.38 against the US dollar in opening trade on Monday, driven by a higher opening in domestic equities.

Forex dealers said the local currency also gained strength amid a weakening of the greenback in overseas markets.

However, rising crude oil prices and sustained foreign fund inflows weighed on the domestic currency and restricted the upmove. Click here to read in full the rupee report.

June 10 | 10:15 am

How safe is HDFC Life’s Sanchay Plus?

While most guaranteed products from insurers give 4.5-5.5 per cent return, HDFC Life’s recently-launched Sanchay Plus promises 6.3 per cent return under two of its plans. Business Line spoke to Prasun Gajri, Chief Investment Officer, HDFC Life, to understand if there is risk attached to the returns promised and what IRDAI’s rule book says on guaranteed return products. Click here to read more on how safe HDFC Life's Sanchay Plus scheme is.

June 10 | 10:10 am

Land request for shore-based plant: SAIL gets positive response from Odisha govt

State-owned steel maker SAILhas received a positive response from the Odisha government on its request of land allocation to set up a coast-based plant in the state, a top company official said.

As part of its 50-MTPA expansion plan, SAIL is planning to set up a 3 million tonnes per annum (MTPA) shore-based plant at an estimated cost of over ₹ 15,000 crore in Odisha.

SAIL had written a letter to the Odisha government for land, its chairman Anil Kumar Chaudhary said. Click here to read in full the report on SAIL gets positive reponse from Odisha on request for land to set up shore-based plant.

June 10 | 10:05 am

RBI Governor calls for system to evaluate performance of bank chiefs

 

The RBI has issued a discussion paper on proposed guidelines for compensation in private banks which also specifies minimum variable pay component and clawback arrangements, among others

The performance of chiefs of public and private sector banks should be closely monitored by the Board of Directors either through a sub-committee or an external peer group review, according to Reserve Bank of India (RBI) Governor Shaktikanta Das. Click here to read in full the report on RBI Governor calls for system to evaluate performance of bank chiefs.

June 10 | 10:00 am

BPCL to invest ₹6,877 crore to revamp Mumbai refinery complex

Bharat Petroleum Corporation Ltd (BPCL) plans to invest ₹6,877 crore to modernise its Mumbai refinery complex by replacing the old Catalytic Cracking Unit and Fluidised Catalytic Cracking Unit with a new, state-of-the-art Petro Resid Fluidized Catalytic Cracking Unit and associated facilities, the State-run refiner said in an application seeking environment clearance for the project.

The project facilities include a reactor and re-generator, a product separation section, treatment facilities for FG/LPG, a new sulphur recovery unit and mounded bullets. The project seeks to enhance safety, incorporate latest environmental management technologies, improve energy efficiency and product yield, BPCL said.

June 10 | 9:55 am

Scheduled banks healthier now as gross NPA ratio dips in FY19

 

There has been a significant improvement in asset quality of scheduled commercial banks (SCBs) during 2018-19 as gross NPA ratio declined to 9.3 per cent as on March 2019 against the peak of 11.5 per cent recorded in March 2018.

At the same time, there has been an improvement in provision coverage ratio (PCR) of SCBs to 60.9 per cent at end-March 2019 from 48.3 per cent at end-March 2018 and 44 per cent at end-March 2015, said Reserve Bank of India (RBI) Governor Shaktikanta Das at NIBM, Pune, on Saturday. Click here to read in full the report on scheduled banks healthier as gross NPA ratio dips.

June 10 | 9:50 am

Cash-strapped Urban Ladder lays off hundreds of employees

 

Omnichannel furniture retailer Urban Ladder has been trimming flab to sustain its operations, but its leadership team claims it is just a couple of months away from turning EBITDA (earnings before interest, tax, depreciation and amortisation) positive.

Industry sources as well as former Urban Ladder employees told BusinessLinethat the start-up let go of 40 per cent of its headcount in the quarter that ended in March. Click here to read more on Urban Ladder lay-offs.

June 10 | 9:47 am

Sensex, Nifty trade firm

The Sensex and Nifty traded on a firm note in early session on Monday. The Sensex gained 0.59 per cent or 232 points to trade at 39,848, while the Nifty gained 62 points or 0.53 per cent to trade at 11,933.

The top gainers on the Sensex were PowerGrid, YES Bank, TCS, Tata Steel and Larsen & Toubro, while the laggards were Kotak Bank, HDFC, M&M, Sun Pharma and HDFC Bank.

All the BSE sectoral indices with the exception of oil and gas were in positive territory. The major gainers were IT sector shares (up 1.57 per cent), technology (up 1.48%), power (1.39%), industrials (0.85%), telecom (0.83%), and consumer durables and realty (up 0.78% each).

June 10 | 9:45 am

Bank of Baroda puts bad loans worth over ₹9,000 crore on the block

 

As resolution through the insolvency courts keep getting delayed inordinately, the State-run Bank of Baroda has put on sale non-performing loans amounting to ₹9,060 crore, including two large accounts — Bhushan Power & Steel and Alok Industries which are undergoing a protracted insolvency process. Click here to read in full the report on BoB puts Rs 9,000-cr worth of bad loans on the block.

June 10 | 9:40 am

Whistleblower complained of fraud at IL&FS in 2017...

 

Fraudulent activities at the crisis-ridden IL&FS were long-running and could have come to light much earlier, in 2017, but for a cover-up job on a whistleblower complaint by the top management in connivance with independent directors, an SFIO investigation has revealed. Click here to read in full the report on whistleblower complained of fraud at IL&FS in 2017.

June 10 | 9:35 am

Stock Fundamentals: Natco Pharma: Good prognosis

 

The stock of Natco Pharma has been on the back foot over the last 12-15 months. Concerns over the company’s growth prospects due to lack of near-term meaningful launches, fear of increasing competition in its blockbuster Copaxone generic drug in the US and possible moderation in revenues from its Tamiflu drug, have been plaguing investors.

But the Copaxone drug, which operates in a three-player market in the US currently, is expected to continue to generate revenues for at least the next six to nine months. Also, the company has a strong pipeline in niche and complex generics that augur well for its growth over the long run. Click here to read in full the Stock Fundamentals on Natco Pharma.

June 10 | 9:30 am

Stock Fundamentals: DHFL: Free fall

 

The stock of DHFL (Dewan Housing Finance Company) was back in focus last week. The stock witnessed a sharp weekly fall of 24 per cent, as concerns over the company’s persisting liquidity stress became accentuated. Fresh trouble began as the housing finance company delayed interest payment on its bonds and bond repayments due on June 4, 2019.

Following this, both Crisil and ICRA downgraded the ratings of DHFL’s commercial papers on Wednesday to default. Crisil said that DHFL has ₹850 crore of outstanding CPs, of which ₹750 crore is due in June 2019. According to reports, by the end of the week, DHFL had settled some of its dues, offering respite to investors. Click here to read in full the Stock Fundamentals on DHFL.

June 10 | 9:25 am

Monsoon here, but delay pushes rain deficit to 45%; cyclone likely to form: IMD

 

Several parts of Kerala received moderate rainfall on Sunday, a day after the South-west Monsoon set in over the State, even as a low-pressure area formed over the Arabian Sea.

The India Meteorological Department (IMD) said the low pressure system was expected to intensify into a depression in the next two days and, subsequently, into a cyclone. Click here to read in full the report on monsoon's arrival and the rain deficit.

June 10 | 9:20 am

Govt’s savings from DBT grow multifold in FY19

 

The government has saved over ₹50,000 crore through direct benefit transfers (DBT) in FY19. This is more than half of the cumulative saving between FY14 and FY18. Under DBT, benefits or subsidies are transferred directly to the beneficiaries’ accounts, thus cutting wastage and ensuring the effective use of resources for schemes such as the LPG subsidy or wages under the rural employment guarantee programme. Click here to read more on Govt savings from DBT grow multifold.

June 10 | 9:15 am

Opening bell

The benchmark indices, the BSE Sensex and the NSE Nifty, opened the week on a firm note. The Sensex quoted at 39,815, up 199 points or 0.50 per cent higher, while the Nifty traded at 11,941, up 71 points or 0.60 per cent higher on Friday's close.

June 10 | 9:10 am

Big Story: P2P: Rules of the game

 

In October 2017, the Reserve Bank of India (RBI) issued master directions for peer-to-peer (P2P) lending and borrowing in India. P2P lending platforms that, for fees and charges, let lenders give loans directly to borrowers have been around in India for some years now. The rise of these loan facilitation intermediaries has been catalysed by increasing internet penetration, digital lending and fin-tech revolutions. But until recently, they were operating largely in a regulatory vacuum, leading to some undesirable practices by some platforms and rising scepticism among market-watchers.

The RBI guidelines of October 2017 were a shot-in-the-arm for P2P platforms — with the central bank setting eligibility criteria, mandating registration of platforms as non-banking financial company-peer to peer (NBFC-P2P), codifying the rules of the game and, in the process, giving the much-needed credibility to the nascent segment. Click here to read in full the Big Story on P2P lending.

June 10 | 9:05 am

Index Outlook: Indices lack clear direction

 

The key domestic indices remained volatile in the previous truncated week as well, and declined in the latter part. The RBI reduced the key repo rate on Thursday and changed its stance to accommodative; despite that, the benchmark indices — the Sensex and the Nifty — slumped sharply on NBFC concerns. The indices could remain choppy in the ensuing weeks as they lack clear direction. Click here to read in full the Index Outlook for the week.

June 10 | 9:00 am

Weekly Trading Guide for week beginning June 10, 2019

SBI (₹341.6)

 

SBI fell sharply last week to test the key support level of ₹335 as expected. The stock was down 3.1 per cent for the week. Whether it manages to sustain above ₹335 or not will decide the direction of the next move.

If SBI holds above the level of ₹335, a bounce to ₹350 and ₹360 is possible in the coming days. It has to breach the key resistance level of ₹362 to gain fresh momentum and rally further to target ₹390 and ₹400 levels. Inability to rise past ₹362 levels can trigger a pull-back move to ₹350 and ₹335 levels again. In such a scenario, a range-bound move between the levels of ₹335 and ₹362 can be seen for some time. On the other hand, if SBI declines below ₹335, it can extend the fall to ₹325 and ₹320 levels. As mentioned last week, the region around ₹320 is a strong long-term resistance-turned support. A further fall below ₹320 is less likely as fresh buyers are likely to emerge around ₹320 and limit the downside. The bias is bullish as the moving average indicators suggest limited downside for the stock.

 

ITC (₹275.9)

ITC fell for the third consecutive week. The stock was down 1 per cent last week. It is poised at a crucial long-term support level of ₹275. Whether ITC manages to bounce back from this support or not will decide the next move.

A strong bounce from this support and a subsequent rally above ₹282 will ease the downside pressure. Such a move could trigger a corrective rally to ₹290 in the near term. It will also give an early sign of the beginning of a fresh leg of a long-term uptrend. But if the stock declines below ₹275 levels, the downside pressure will increase. Such a break will increase the likelihood of the stock extending its down-move to ₹260. The bias on the daily chart is negative after the fall below ₹280 last week. Also, the 21-day moving average is on the verge of crossing below the 200-day moving average. This is a negative signal, indicating that the upside could be limited. This increases the possibility of the stock declining below ₹275 in the coming days and targeting ₹260 on the downside.

 

Infosys (₹739.5)

Infosys surged about 2 per cent intra-week to test ₹750, as expected. However, the stock failed to sustain higher and fell from the high of ₹750.85, giving back almost all the gains. The intermediate resistance at ₹755 seems to be holding well.

 However, as long as the stock trades above ₹730, the outlook will be positive. There is a strong likelihood of the stock breaking above ₹755 in the coming days. Such a break can take Infosys higher to ₹770 and ₹775. The stock will gain fresh momentum if it manages to rise past ₹775 decisively. The next targets are ₹790 and ₹800. But inability to breach the ₹770-775 resistance region can pull the stock lower to ₹755 and ₹750 again. In such a scenario, the broader ₹695-775 sideways range will continue to remain intact. The stock has been stuck in this range since January this year. This rally to ₹770-775 will get negated if Infosys declines below ₹730 in the coming sessions. In such a scenario, it could fall to ₹715 and ₹705. But this looks less probable as the bias on the charts is positive.

 

RIL (₹1,315.3)

RIL surged over 3 per cent in the initial part of the week, but failed to sustain higher. The stock made a high of ₹1,373 and reversed lower, giving back all the gains. The stock has closed 1 per cent lower for the week.

The price action over the last few weeks indicates that the stock lacks fresh follow-through buyers above ₹1,350 levels. This opens up the possibility of the stock breaking below the crucial support level of ₹1,300. Such a break will bring renewed pressure on the stock and trigger a fresh fall initially to ₹1,280-1,275 band. A further break below ₹1,275 will then increase the likelihood of the stock extending its down-move to ₹1,250 and ₹1,220 thereafter. On the other hand, if RIL manages to sustain above ₹1,300, a bounce to ₹1,350-1,370 can be seen again. In such a scenario, RIL can remain range-bound between ₹1,300 and ₹1,370 for some time. A strong break and a decisive close above ₹1,370 will boost the momentum and turn the outlook to positive. Such a break will then pave way for a fresh rally to ₹1,400 and ₹1,430.

 

Tata Steel (₹482.15)

Tata Steel is struggling to rise past the psychological level of ₹500 over the last couple of weeks. The stock made a high of ₹502.75 and reversed sharply lower to close 1.2 per cent lower for the week.

The near-term view is negative. Tata Steel is likely to remain below ₹500 and there is a strong likelihood of it falling to test the key 200-week moving average support level of ₹460. A bounce from ₹460 can take it higher to ₹480-490 again and keep the stock range-bound between ₹460 and ₹500 for some time. But a break below ₹460 can take it to the crucial support level of ₹445. As mentioned last week, the price action around ₹445 will need a close watch. A strong break below ₹445 will bring renewed pressure on the stock. It will keep the long-term downtrend intact and increase the likelihood of the stock tumbling towards ₹410 and ₹400 levels over the medium term.

 

The writer is a Chief Research Analyst at Kshitij Consultancy Services

 

Published on June 10, 2019