Sensex ends 83 points higher

Closing bell

Market benchmark BSE Sensex closed 83 higher, led by gains in energy, metal and power stocks as global crude oil prices eased and rupee recovered against the dollar.

After a rangebound session, the 30-share index ended 82.79 points, or 0.23 per cent, higher at 36,563.88. The index hit an intra-day high of 36,712.99 and a low of 36,465.92. Similarly, the broader NSE Nifty settled 31.05 points, or 0.29 per cent, up at 10,848.65.

Top gainers in the Sensex pack included Tata Steel, Vedanta, SBI, Tech Mahindra, Bajaj Finance, Asian Paints, M&M, NTPC and PowerGrid, rising up to 3.95 per cent. On the other hand, ONGC, Yes Bank, Bharti Airtel, HDFC Bank, Sun Pharma and Maruti fell up to 2.08 per cent.

After plunging over 2 per cent in the past two sessions, equities took a breather as oil prices cooled after Saudi Arabia's energy minister said that more than half of the country's daily crude oil production, that was knocked out by the drone attack, has been recovered. He also assured that production capacity at its targeted plants would be fully restored by the end of the month.

Consequently, Brent crude futures fell 0.95 per cent to 63.94 per barrel (intra-day). Tracking the movement in oil prices, the rupee appreciated 52 paise (intra-day) to trade at 71.26 per US dollar.

Further boosting global market mood, US President Donald Trump said a trade agreement between the US and China was likely to happen either before or immediately after the American elections. Market participants were also awaiting cues from the policy meeting of the Federal Reserve, traders said.

Elsewhere in Asia, Shanghai Composite Index, Hang Seng, Nikkei and Kospi ended on a mixed note. Stock exchanges in Europe were trading in the green in their respective early sessions. - PTI

Bullion market

Gold dropped ₹215 to ₹38,676 per 10 gram in the national capital on Wednesday on strong rupee, according to HDFC Securities. In line with gold, silver prices also declined by ₹770 to ₹47,690 per kilogram. “Gold price for 24 Karat in Delhi was trading down by ₹215 as stronger rupee reduced investment demand for gold. The spot rupee was trading 51 paise stronger against the dollar with fall in crude oil prices during the day,” Tapan Patel, senior analyst - commodities, HDFC securities said. Read more on the bullion market closing trade report here

What does Altico Capital default mean to MF investors

Altico Capital defaulted on interest payments  of around Rs 20 crore on External Commercial Borrowing (ECB) that were due to the Dubai-based Mashreq Bank. This prompted the rating agencies to downgrade Altico bonds to below investment grade.

Fourteen debt mutual funds, including FMPs from UTI and Reliance AMCs, that held the NCDs issued by Altico took a hit of up to 8 per cent in their NAV in a single day. According to MF research application, ACEMF, these schemes’ investments in NCDs issued by Altico amounted to around ₹538 crore (as of August 2019). Click here to read what does Altico Capital defaults mean to mutual funds investors

Mukesh Ambani raises stake in RIL

Mukesh Ambani has raised promoter stake in flagship Reliance Industries. File Photo

Billionaire Mukesh Ambani has raised promoter stake in flagship  Reliance Industries  by 2.71 per cent to 48.87 per cent, according to regulatory filing by the company. Ambani and his private firms held 47.29 per cent stake as on June 30, 2019 in India’s second-most valuable company. Read more here

The stocks of Reliance Industries were trading 0.67 per cent higher at ₹1,205.20

European markets

Early market action remained tepid ahead of the Fed's policy statement. File Photo

European shares steadied after early declines, as technology shares helped offset losses in luxury goods, while many investors remained on the sidelines ahead of an expected reduction in US borrowing costs by the Federal Reserve.

Early market action remained tepid ahead of the Fed's policy statement at 2 pm EDT (1800 GMT), where it is expected to reduce US interest rates for the second time this year. Read more on the European stock markets report, here

Broker's call

CapitalVia Global

Jubilant FoodWorks (Buy)

CMP: ₹1,252.2

Target: ₹1,420

Jubilant FoodWorks witnessed steady financial performance in Q1 FY20.

A strong uptick of 9.9 per cent y-o-y was witnessed in revenue and stood at ₹940 crore backed by improvement in customer demand. The company achieved same-store-sales growth (SSG) of 4.1 per cent in Domino’s Pizza. Read our Broker's call on Jubilant FoodWorks here

Oil & gas stocks bounce back in positive zone

The 30-share BSE index Sensex was trading 163.50 points or 0.45 per cent at 36,644.59 and the 50-share NSE index Nifty was trading marginally higher at 10,853.70, up 36.10 points or 0.33 per cent.

The oil & gas stocks, ending the losing streak, was trading 1.13 per cent higher in the afternoon trade.

Banking sector caught in middle of despair and hope

India’s fragile financial system is swinging between despair and hope. Two separate incidents, both featuring YES Bank, recently underscored the drag of past underwriting follies as well as the lift from a digital reset. It will take time, but good things will come to Indian banking as a result of the present crisis.

Rupee trading

Average daily volumes for rupee in the UK soared to $46.8 billion in April. File Photo

London has overtaken Mumbai to become the top centre for trading rupee. That’s adding to a sense of urgency among local authorities to deepen the onshore market. Trading in dollar-rupee offshore non-deliverable forwards increased three-fold over the three-year period, the BIS report showed.

Average daily volumes for rupee in the UK soared to $46.8 billion in April, a more than five-fold jump from $8.8 billion in 2016, according to the latest survey from the Bank for International Settlements released this week. Click here to read more on the rupee trading and onshore market

Nifty Call

Following a positive started the Sensex and the Nifty began to decline witnessing selling pressure. The Nifty September month index futures began the session in positive territory, opening at 10,889. After marking an intra-day high at 10,896 the contract started to decline and recorded an intra-day low at 10,826. Read our Nifty Call for September futures here

JSW Steel cuts US capex

JSW Steel has cut its capital expenditure plans in the US by 60 per cent to $400 million due to weak demand and a slowing economy. However, the company has decided to go ahead with its ₹15,000-crore capex plan in India despite the sharp drop in demand amid liquidity concerns.

The stocks of JSW Steel were trading 2.82 per cent higher at Rs 222.20.

Broker's call

JMFL

Bharat Electronics (Buy)

CMP: ₹107.95

Target: ₹130

While competition from private sector is increasing, BEL is geared up through various tie-ups to capture larger pie of defence orders and is slated to incur 10-12 per cent of sales in R&D to stay ahead of competition. We maintain BUY rating with TP of ₹130, based on 16x FY21E EPS (LT median). Read our Broker's call on Bharat Electronics here

Sensex jumps 160 points

The 30-share BSE index Sensex jumped 160.37 points or 0.44 per cent to 36,641.46 and the broader index Nifty was trading 45 points or 0.42 per cent higher at 10,862.20. The bank and financial stocks were lending support to the indices.

In the Sensex pack, the top gainers were Tata Steel, State Bank of India, Bajaj Finance, Vedanta, and Asian Paints while the laggards were ONGC, ITC, Yes Bank, Bharti Airtel and Maurti.

Metal and realty stocks emerged top gainers among the sectoral indices.

In the NSE index, the stocks lending support were Tata Steel, JSW Steel, Bajaj Finance, GAIL and Bajaj Finserv while the top losers were Britannia, ONGC, Coal India, Eicher Motors, and Bharti Airtel.

Opinion | Understanding liquidity crisis

The financial system and the economy are systemically more vulnerable now than ever before. Business uncertainty, solvency and liquidity worries are growing. Market funding and liquidity funding crises are resulting in an unprecedented liquidity gridlock in trade and industry.

This liquidity crisis, along with deep structural weaknesses in the ecosystem, has further triggered an unprecedented economic conundrum. The risk of systemic events has increased. Read our Opinion on why are we in midst of a liquidity crisis

Gold and precious metals

Gold to remain neutral between $1,488-$1,523.61/oz.

Gold prices were little changed on Wednesday amid cautious mood as investors awaited cues on the US central bank's stance on monetary easing, while a drop in crude prices dented demand for safe-haven bullion. Spot gold was barely changed at $1,502.70 per ounce, as of 0425 GMT. US gold futures were trading 0.2 per cent lower at $1,510.70 per ounce. Read more on the global bullion market and the prices of precious metals

Shares trim early gains

The shares gave up most of their early gains as waning hopes of tax cuts to spur demand hit automakers and offset a boost from retreating oil prices. Shares in other Asian markets were largely flat ahead of an expected US interest rate cut, while investors also assessed the impact of higher crude prices in the wake of the weekend attacks on Saudi oil facilities.

“(India) markets are being kept subdued by geopolitical risks arising from the Saudi situation, and the lack of reforms locally which can boost slowing growth,” said Sumit Pokharna, vice-president at Kotak Securities.

The GST Council is unlikely to approve lowering the tax for the auto and allied components sector this week, as a study has warned of major revenue losses, Reuters reported, citing two government officials. Auto companies have long argued that a tax cut is necessary to spur demand and lift the ailing sector.

Eicher Motors Ltd and Maruti Suzuki India Ltd fell over 2 per cent each to their lowest in nearly two weeks, while the Nifty Auto index fell as much as 1.4 per cent.

The broader NSE index was up 0.13 per cent or 13.85 points at 10,831.45, while the benchmark BSE index was 0.14 per cent or 49.88 points higher at 36,518.33.

Biscuit maker Britannia Industries Ltd was the biggest loser on the NSE index, falling as much as 3.9 per cent to an over three-week low. Dewan Housing Finance Corporation Ltd dropped 5.6 per cent after Reuters reported that a plan to rescue the debt-laden company had hit a major roadblock as only a small segment of bondholders agreed to be on board the proposed resolution.

Oil marketing companies rose as crude extended losses from the previous session, after Saudi Arabia's energy minister said the kingdom will restore lost oil production by the end of the month. The stocks were further bolstered by news that India was looking to raise oil imports from Russia.

Bharat Petroleum Corporation Ltd climbed 3.6 per cent and was the top percentage gainer on the NSE index, while Indian Oil Corporation Ltd and Hindustan Petroleum Corp Ltd advanced 2.6 per cent and 4 per cent, respectively.

Bajaj Finance Ltd rose 2.4 per cent after the non-banking finance firm approved raising up to Rs 85 billion through a qualified institutions placement. - Reuters

Challenges ahead for US Federal Reserve

The Fed is due to release its policy statement at 2 pm EDT (1800 GMT). File Photo

The Federal Reserve will conclude its latest policy meeting on Wednesday buffeted by conflicting economic data, under steady pressure from the White House for steep interest rate cuts, and confronted as well with an unexpected jump in overnight borrowing costs that may require action on its own. The Fed is due to release its policy statement at 2 pm EDT (1800 GMT). Fed Chair Jerome Powell is scheduled to hold a news conference half an hour later. Read more on the challenges ahead for the US Federal Reserve

Forex market

The Fed is expected to cut its benchmark rate for the second time this year by 25 basis points to 1.75 per cent-2.00 per cent at a meeting ending Wednesday. File Photo

The dollar traded near a seven-week high versus the yen as oil markets recovered from a supply shock, but the focus is firmly on a US Federal Reserve meeting later on Wednesday that is widely expected to deliver an interest rate cut.

Sterling traded near a six-week high versus the dollar as some speculators reduced excessive bets on a decline in the pound, but sentiment remained weak due to uncertainty over how the UK will exit the European Union. Click here to read more on the forex market report

US markets

Wall Street ended higher on Tuesday.

Wall Street ended higher on Tuesday as the impact of weekend attacks on Saudi Arabia's biggest oil refinery faded and investors awaited a widely expected Fed interest rate cut on Wednesday.

Stocks closed firmly in positive territory after being mixed for much of the session. The S&P 500 is less than 1 per cent short of its record high close on July 26. Investors were calmed after US President Donald Trump said he did not want war and Saudi Arabia said it would restore its lost output by the end of September. More on the US stock markets, read here

Rupee market

At the interbank foreign exchange the rupee opened at 71.47.

The Indian rupee appreciated by 35 paise to 71.43 against the US dollar in early trade on Wednesday as gains in domestic equity market and easing crude prices strengthened investor sentiments. Forex traders said reports that half of Saudi Arabia’s daily production has been recovered post-attack enthused investors. At the interbank foreign exchange the rupee opened at 71.47 then gained further ground and touched a high of 71.43, registering a rise of 35 paise over its previous close. Click here to read more on the local currency market

Bank and financial stocks lift indices

The 30-share BSE index Sensex was trading 17.17 points or 0.05 per cent higher at 36,495.70 and the 50-share NSE index Nifty was trading marginally higher at 10,820.90, up 3.30 points or 0.03 per cent.

The top stocks lending support to the index were Tata Steel, Bajaj Finance, Vedanta, Kotak Mahindra and Tata Motors while the major losers were Yes Bank, ONGC, Maruti, Sun Pharma and ITC.

The auto and realty stocks fell over 3.5 per cent among the sectoral indices.

In the broader index, the major gainers were BPCL, IOC, Yes Bank, JSW Steel, Hero Motocorp while the top losers were Britannia, ONGC, Infosys, Dr Redy's and Cipla.

Gautam Thapar barred from accessing markets

Gautam Thapar

SEBI barred ousted former Chairman of CG Power and Industrial Solutions, Gautam Thapar, and three others from accessing the securities market until further orders. “Gautam Thapar, VR Venkatesh, Madhav Acharya and B Hariharan are restrained from accessing the securities market, and are further prohibited from buying, selling or otherwise dealing in securities in any manner whatsoever, either directly or indirectly, till further orders,” the SEBI said.

CG Power board removed Thapar as Chairman following a preliminary investigation which revealed that money was siphoned off from the company. The stock of CG Power was trading 2.17 per cent lower at Rs 15.35. Read more

Commodities market

Oil prices slipped on Wednesday, extending losses from the previous session after Saudi Arabia's energy minister said the kingdom will restore lost oil production by the end of the month. But investors remained cautious about West Asia tension after the US said it believes the attacks that crippled Saudi Arabian oil facilities last weekend originated in southwestern Iran.

Brent crude oil futures fell 15 cents, or 0.2 per cent, to $64.40 a barrel by 0253 GMT, after tumbling 6.5 per cent the previous session. Read the commodities market report here

Rupee weighed down by geopolitical tensions

During the past week, the rupee made a high of 70.86

The rupee last week gained nearly one per cent and ended the week at 70.92 against the dollar, above an important resistance of 71, also breaking a significant resistance band between 71.40 and 71.60. During the past week, the rupee made a high of 70.86; a four weeks high. The FPIs have net sold ₹915 crore worth of shares in the last five trading sessions. Read more on the rupee market and the factors that led to its sell off

Early trade

Domestic equity benchmark BSE Sensex jumped over 200 points in early session, driven by gains in energy and banking stocks, amid positive global cues.

The 30-share index is trading 48.71 points, or 0.13 per cent, higher at 36,527.63, while the broader Nifty rose 0.85 points, or 0.01 per cent, to 10,818.45. In the previous session, the BSE barometer plunged 642.22 points, or 1.73 per cent, to 36,481.09, while the Nifty fell 185.90 points, or 1.69 per cent, to 10,817.60.

Top gainers in the Sensex pack in early trade included Bajaj Finance, Reliance Industries, SBI, Yes Bank, Axis Bank, Kotak Bank, Tata Steel, Vedanta, Asian Paints, Bharti Airtel, HCL Tech, HDFC and TCS, rising up to 2.10 per cent. On the other hand, Maruti, Hero MotoCorp, Tata Motors, HUL, ONGC and ITC fell up to 1.50 per cent.

According to experts, market sentiment recovered on positive news on multiple geopolitical fronts like oil prices and US-China trade talks.

Equity markets took a breather as oil prices cooled off after Saudi Arabia’s energy minister said that more than half of the country’s daily crude oil production that was knocked out by an attack had been recovered, assuring that production capacity at its targeted plants would be fully restored by the end of the month.

Further, US President Donald Trump said a trade agreement between the US and China was likely to happen either before or immediately after the American elections. Global investor sentiment is also buoyed on expectations of a US Fed interest rate cut later in the day, experts said.

Elsewhere in Asia, Shanghai Composite Index, Hang Seng and Kospi were trading in the green in their respective late morning sessions, while Nikkei was in the negative territory. On Wall Street, bourses ended on a positive note on Tuesday.

The rupee, meanwhile, recovered 29 paise (intra-day) against its previous close at 71.49 in early session.

Global oil benchmark Brent crude fell 0.22 per cent to 64.41 per barrel (intra-day). On Tuesday, foreign portfolio investor sold shares worth a net of Rs 808.29 crore, while domestic institutional investors bought equities worth Rs 85.76 crore, provisional data showed. - PTI

Global markets

File photo

MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.13 per cent, while Japan's Nikkei was flat. Wall Street shares ticked up a tad on Tuesday, with the S&P 500 gaining 0.26 per cent. “I would think a spike in oil prices will likely prove to be short-term given that the global economy isn't doing too well,” said Akira Takei, bond fund manager at Asset Management One. Read the global stock markets report here

Stocks in focus

DCM has hived off its IT business division to DCM Infotech from September 16. The deal has been done on going concern basis, and at book value as on September 16, for ₹8 crore. The hive-off is to unlock value of the IT business unit, DCM Data Systems, and to run it as a separate entity specialising in networking, analytics, cloud and digital technologies, it said. The company plans to attract private equity or strategic partners for the IT arm to achieve desired growth.

Ahluwalia Contracts (India) has secured new order worth ₹407 crore for construction of medical college (civil works) at Koriyawas village, Mohindergarh (district), Rewari (Haryana), and other orders aggregating to ₹90.36 crore. The total order inflow during FY 2019- 20 stands at ₹927.59 crore, Ahluwalia Contracts said in a notice to the stock exchanges. Shareholders and investors will closely monitor the execution and further updates on these projects.

Sunteck Realty has acquired a prime project near Mumbai’s Lokhandwala, Off New Link Road, Andheri (West), with the potential to develop approximately 1.1 mn sq ft in saleable area and revenue of over ₹2,500 crore in the next four to five years. The project is acquired under the asset-light joint-development agreement model focused on establishing a strategic tie-up with credible partners, which will further strengthen the cash flow and balance sheet.

Focus turns to Fed move

The drone attack on Saudi Arabia’s state-owned Aramco saw a massive spike in global crude oil prices leading to a panic reaction in stock markets on Tuesday, with the Sensex fa lling by 642 points or 1.73 per cent to close at 36,481. Nifty, the broader index, too fell by 185 points or 1.69 per cent to 10,817.

Now the focus is on the US Federal Reserve's anticipated rate cut. It is this event and not the Saudi drone attack that will drive the global equity markets in the coming days, experts told  BusinessLine . Read more on the factors that could impact the stock markets in coming days

Opening bell

The 30-share BSE index Sensex opened 140.29 points higher at 36,621.38 against the previous close of 36,481.09, ending the losing streak. Similarly, the 50-share NSE index Nifty opened 61.25 points higher at 10,878.75 against the previous close of 10,817.50. Investors eye US Federal anticipated rate cut

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:

₹2208 • HDFC Bank

₹831 • Infosys

₹237 • ITC

₹129 • ONGC

₹1197 • Reliance Ind.

₹273 • SBI

₹2121 • TCS

10833 • Nifty 50 Futures

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

Today's Pick

Bangalore/03/03/2008----Sasken office on Domlur which was damaged by Kannada Rakshana Vedike in Bangalore on Monday. Photo:Sampath Kumar_ G_P_Bangalore. 03,March 2008.

We recommend a buy in the stock of Sasken Technologies at the current levels of Rs 541.9. On Tuesday, the stock jumped 6.4 per cent accompanied by good volume, breaking above the key resistance as well as the upper boundary of the sideways range at ₹530. With the recent rally, the stock appears to have changed direction backed by positive divergence in both daily as well as weekly relative strength index. Read our stock recommendation of Sasken Technologies here

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