Sensex rallies for 6th day, rises 246 points

Auto stocks among top losers

3.40 pm

Closing bell

Domestic equity market extended its gains for the sixth straight session, with the benchmark Sensex rising 246 points on sustained buying across sectors.

The 30-share BSE Sensex ended 246.32 points, or 0.63 per cent, higher at 39,298.38. It hit an intra-day high of 39,361.06 and a low of 38,963.60. The broader NSE Nifty too spurted 75.50 points, or 0.65 per cent, to settle at 11,661.85.

Yes Bank was the top gainer in the Sensex pack, rallying up to 8.44 per cent, followed by Maruti, PowerGrid, NTPC, L&T and SBI. Shares of Reliance Industries ended 1.37 per cent higher ahead of its quarterly earnings, scheduled to be announced later in the day.

On the other hand, Tata Motors, Bajaj Auto, Bharti Airtel, ICICI Bank, Axis Bank and Infosys fell up to 1.05 per cent.

“Indian equities outperformed major global markets for the week. Equity markets witnessed a sharp rally on foreign investor buying, progress in US-China trade talks and as well as a deal being reached between UK and EU on Brexit,” said Sanjeev Zarbade, VP PCG Research, Kotak Securities.

Investor sentiment is upbeat after Finance Minister Nirmala Sitharaman hinted at further stimulus in FY20, they said.

Elsewhere in Asia, bourses in Shanghai, Hong Kong and Seoul ended on a negative note after data showed that Chinese economy expanded at its slowest pace in nearly three decades in the third quarter. Exchanges in Tokyo, however, settled in the green.

Equites in Europe were trading on a mixed note in their respective early deals. Meanwhile, the Indian rupee appreciated marginally to 71.13 against the US dollar intra-day. Brent crude futures, the global oil benchmark, rose 0.12 per cent to USD 59.98 per barrel. - PTI

3.25 pm

European shares

Bourses in Germany, Spain, Italy eke out tentative gains. File Photo   -  Reuters

 

French carmaker Renault dragged European shares lower on Friday, while the sharpest contraction in the Chinese economy in nearly three decades exacerbated worries about slowing global growth.

Renault slumped 12.7 per cent to lowest since 2013 after the company cut its full-year revenue and profit forecast amid a broad-based slump in auto sales. The pan-European STOXX 600 index was marginally lower, eyeing its third day of losses, but still on pace to end a volatile week, dominated by Brexit headlines, modestly higher. Read the European stock markets report here

3.10 pm

JSW Steel raises ₹2,000 cr

JSW Steel

 

Sajjan Jindal-headed JSW Steel has raised fresh funds of about ₹2,000 crore through a private placement of 10-year bonds at 8.79 payable semi-annually.

The Committee of Directors of Board in a meeting held on Friday approved the allotment of 20,000, 8.79 per cent rated, listed, secured, redeemable, non-convertible debentures bearing a face value of ₹10 lakh each at par to the investors identified by the Committee aggregating to ₹2,000 crore, said the company in a statement. Read more on the funding raising by JSW Steel

2.55 pm

Editorial | End of Libor

As companies that borrow in overseas markets get ready for a new era post-2020, one in which the London Interbank Offered Rate no longer exists, policymakers need to gear up too, to smoothen the process.

LIBOR, which is the rate at which banks borrow wholesale unsecured loans from each other, has been the world’s most preferred benchmark so far. Click here to read the Editorial on end of Libor and its impact

2.40 pm

Sensex jumps over 200 points

The 30-share BSE index Sensex jumped 218.76 points or 0.56 per cent to 39,270.82 and the 50-share NSE index Nifty was trading higher at 11,654.55, up 68.20 points or 0.59 per cent.

The top gainers in the Sensex pack were Yes Bank, Power Grid, State Bank of India, L&T and Reliance while the laggards were Bajaj Auto, Bharti Airtel, HDFC, Axis Bank and Mahindra & Mahindra.

In the broader index, the stocks of Yes Bank, Adani Ports, Coal India, Grasim and Reliance were leading the positive territory while the major losers were Zee Entertainment, Tata Motors, Eicher Motors, Bajaj Auto and Mahindra & Mahindra

2.25 pm

Commodities market

 

Oil prices slid on jitters over demand from China after the world's largest oil importer recorded its weakest quarter of economic growth in nearly three decades, dragged down by a trade dispute with the United States.

Global benchmark Brent crude oil futures fell by 21 cents, 0.4%, to $59.70 a barrel by 0646 GMT. US West Texas Intermediate (WTI) crude futures edged down by 4 cents, or 0.1%, to $53.89 per barrel. Read more on the commodities market here

2.10 pm

Mindtree’s Q2 numbers evoke mixed reaction from analysts

Mindtree

 

Shares of Mindtree was trading 0.77 per cent higher and it had slipped to a low of ₹720 in early trade on Thursday on the BSE after the company’s Q2 performance evoked mixed reactions from analysts. The stock managed to recover partly to close at ₹729.35.

Motilal Oswal, in a research report, said: “Considering the profit miss in Q2 and management’s commentary about the gradual margin improvement, we cut our EBIT margin estimate by 120 bps/30 bps for FY20/21. Read more on the analysts take on Mindtree Q2 numbers here

1.55 pm

Gold and precious metals

 

Gold prices held above $1,490 on Friday as disappointing data from China reinforced concerns that its trade spat with the United States had begun taking a toll on global economies, while the Brexit deal waits for parliamentary backing.

Spot gold rose 0.1 per cent to $1,492.45 per ounce as of 0522 GMT. Amongst other precious metals, palladium rose 0.1 per cent higher to $1,760.67, a day after hitting a record high of $1,783.21 an ounce. Read more on the prices of gold and other precious metals

1.40 pm

Zee stocks

A representational image

 

The stock of Zee Entertainment, one of the largest players in the entertainment industry, is down about 8 per cent today in bourses. This follows the weak September quarter results that were announced yesterday.

Muted revenue from advertisements, promoter’s stake sale overhang and decline in cash-flow due to a sustained increase in working capital requirements are weighing on the stock. Click here to read more on the stock activity of Zee Entertainment

1.25 pm

Broker's call

Anandrathi

CMP: ₹68.7

Target: ₹90

Karnatak Bank’s reported NIM (net interest margin) for the quarter was 282 bps and we expect it to be flat in the near term, given the bank’s inclination to less risky assets in its retail and SME portfolios and lower pricing power in its corporate book. Now, however, with lower slippages anticipated, we expect credit costs to turn normal. But, with the current coverage at 28 per cent (excluding write-offs), the RoE may take another 5-6 quarters to touch double digits. We model 9 per cent RoE and 0.6 per cent RoA for FY21. Read our Broker's call on Karnataka Bank here

1.10 pm

Sensex gains led by Reliance stocks

The 30-share BSE index Sensex jumped 192.58 points or 0.49 per cent to 39,244.64 while the NSE index Nifty climbed 60.70 points or 0.52 per cent to 11,647.05.

 

12.55 pm

South Indian Bank results

 

Kerala-based South Indian Bank registered a 20 per cent growth in net profit at ₹84.48 crore in Q2 against ₹70.13 crore in the corresponding period of the previous fiscal.

The operating profit for the quarter has grown from ₹309.78 crore to ₹411.45 crore, a growth of around 33 per cent. The net interest income registered a growth of 15 per cent and while other income 58 per cent. Read more on the South Indian Bank quarterly results here

The stocks of South Indian Bank were trading 4.72 per cent higher at Rs 10.42

12.40 pm

FMCG performance in rural India

 

The country’s FMCG market, which clocked a value growth of 7.3 per cent in Q3 2019 — down from 16.2 per cent in Q3 2018 — has seen rural growth dropping below urban growth for the first time in seven years, said Nielsen Holdings Plc in its report on Q3 (July to September 2019) India FMCG Growth Snapshot.

The FMCG market has been witnessing a resurgence in modern trade, apart from divergent trends in the north and south zones of the country, it added. Read more on the FMCG sector performance in rural India here

12.25 pm

Reliance m-cap

Reliance Industries’ ratings are supported by its strong business profile and robust refining asset quality, Fitch said.   -  Bloomberg

 

On Wednesday, Bank of America Merrill Lynch had said that Reliance Industries would be the first Indian company to reach $200-billion market cap in 24 months,

In a report, BofA-ML said, its analysis indicates that incrementally three transformational drivers — new commerce venture, fixed broadband business and digital initiatives — could add $55-billion enterprise value for the company. Click here to read more on the market capitalisation of Reliance Industries

12.10 pm

Sensex surges nearly 200 points

The 30-share BSE index Sensex surged 192.61 points or 0.49 per cent to 39,244.67 while the broader index Nifty jumped to 11,639.10, up 52.75 points or 0.46 per cent.

The stocks of Reliance contributed for the gains, trading nearly 2 per cent higher at Rs 1,421.55.

The top stocks supporting the BSE index are Yes Bank, Reliance, L&T, State Bank of India, Vedanta and the laggards were Mahindra & Mahindra, Bajaj Auto, Bharti Airtel, IndusInd Bank and Tata Motors.

In the 50-share index, the major gainers were Yes Bank, Coal India, Adani Ports, Infratel, and Grasim while the stocks of Zee, Mahindra & Mahindra, Tata Motors, Bajaj Auto, and Eicher Motors were in the negative territory

11.55 am

Broker's call

LKP Research

CMP: ₹84.4

Target: ₹121

Federal Bank

Net profit came in at ₹420 crore, up by 56.6 per cent y-o-y. This quarter numbers were marked by slower growth, higher NPLs (led by one large corporate account), elevated opex cost and a miss on margins too. Slippages were at ₹540 crore (versus ₹420 crore q-o-q) which were largely led by one large corporate account amounting to ₹180 crore. Bank highlighted its exposure to few large vulnerable accounts (including 2 HFCs and IL&FS) amounts to ₹475 crore which are still standard in the books and provisions on these are at ₹70 lakh. Margins q-o-q slipped by about 14 bps to 3 per cent led by linking of advances & deposits to external benchmark repo rates. Read our Broker's call on Federal Bank here

11.40 am

China GDP

Gross domestic product rose just 6% year-on-year, marking a further loss of momentum for the economy. File Photo   -  Reuters

 

China's third-quarter economic growth slowed more than expected and to its weakest pace in almost three decades as the bruising US trade war hit factory production, boosting the case for Beijing to roll out fresh support.

Gross domestic product (GDP) rose just 6 per cent year-on-year, marking a further loss of momentum for the economy from the second quarter's 6.2 per cent growth. China's trading partners and investors are closely watching the health of the world's second-largest economy as the trade war with the United States fuels fears about a global recession. Click here to read more on China's GDP data

11.25 am

US stocks

A broad-based rally led all three major U.S. stock averages to moderate gains. File Photo   -  AP

 

Wall Street advanced on Thursday as investor sentiment was buoyed by a string of corporate earnings beats and encouraging geopolitical developments. A broad-based rally led all three major US stock averages to moderate gains.

Analysts now see third-quarter S&P 500 earnings falling by 2.9 per cent, according to Refinitiv I/B/E/S, marking the first contraction since the earnings recession that ended mid-2016. Read the US stock markets report here

11.10 am

Currency market

 

The rupee was down 4 paise at 71.20 per US dollar in opening deals due to increased demand for the greenback from importers. After opening on a flat note, the rupee lost some ground as the morning trade progressed. Read the local currency market report here

10.55 am

Shares rise on Brexit deal, positive earnings hopes

Shares gained, as global investor sentiment was high after the UK and European Union's Brexit deal, and on hopes of a positive quarterly earnings season in the domestic market.

The broader NSE index rose 0.37 per cent or 42.30 points to 11,628.65, while the benchmark BSE index was up 0.42 per cent or 163.45 points at 39,215.51.

Britain clinched an eleventh-hour Brexit deal with the EU on Thursday, more than three years after Britons voted in a referendum to leave the bloc, but Prime Minister Boris Johnson still faces a knife-edge vote in parliament to get it approved.

In India, the September-quarter earnings season began on a mixed note with some large-cap companies beating estimates and others reporting below-par results.

However, investors were hopeful that last month's government move to cut corporate taxes will result in a positive earnings season as large-cap companies such as Hindustan Unilever already reported better-than-expected results riding on the lower rates.

“There are positives in many sectors and there are possibilities of near-term optimism due to the earnings so far and the global sentiment,” said Vinod Nair, head of research at Geojit Financial Services. “The news coming in is that it's getting positive and positive.”

Battered mid-cap and small-cap shares surged as both the Nifty midcap index and the Nifty smallcap index rose between 1 per cent and 1.5 per cent. The state-owned bank index was the top gainer among the sub-indexes and rose 1.3 per cent.

Yes Bank shares rose 6.75 per cent and topped the gainers on the Nifty. Zee Entertainment shares fell as much as 6.11 per cent after the company's quarterly earnings missed estimates.

Meanwhile, MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.17 per cent, after China's economic growth slowed more than expected to 6 per cent year-on-year in the third quarter, the weakest pace in almost three decades. - Reuters

10.40 am

Forex market

Sterling on the up after new Brexit deal reached.   -  Bloomberg

 

The pound traded near a five-month high against the dollar and the euro after Britain's prime minister Boris Johnson and European Union leaders agreed a new deal for Britain to exit the bloc. The yuan held steady against the dollar after data showed China's economy grew at the weakest pace in more than 27 years in the third quarter due to a costly trade war with the United States and weak factory production. Click here to read the forex market report

10.25 am

ADNOC, Adani, BASF, Borealis ink MoU

Chemical production complex expected be commissioned in 2024

Taking forward their announcement on joint investments made in January this year, BASF and Adani have jointly announced the signing of a Memorandum of Understanding (MoU) with Abu Dhabi National Oil Company and Borealis AG, to undertake a joint feasibility study to evaluate collaboration on for the establishment of a chemical complex in Mundra.

The stocks of BASF India were trading 3.76 per cent higher at Rs 979.80.

ADNOC, Adani, BASF, Borealis ink MoU to study joint development of $4-bn chemical complex in Mundra

Chemical production complex expected be commissioned in 2024 Taking forward their announcement on joint investments made in January this year, BASF ...

Read More  

10.10 am

DHFL results

 

The independent auditors' review report on the quarterly unaudited consolidated financial results of the financially stressed Dewan Housing Finance Corporation Ltd (DHFL) has raised significant doubt on the ability of the company to continue as a going concern.

The report said DHFL, which incurred loss aggregating ₹224 crore (including comprehensive loss)against a net profit of ₹472 crore in the year-ago period, may be unable to realize its assets and discharge its liabilities including potential liabilities in the normal course of business. Click here to read more on the DHFL quarterly results

9.55 am

Sensex rises over 100 points

Equity benchmark BSE Sensex rose over 100 points in early trade amid led by gains in index heavyweights HDFC Bank and RIL amid sustained foreign fund inflow.

The 30-share index was trading 115.71 points, or 0.30 per cent, higher at 39,167.77 in morning trade. The broader NSE Nifty advance 32.40 points, or 0.28 per cent, to 11,618.75.

Top gainers in the Sensex pack included Yes Bank, Vedanta, Hero MotoCorp, PowerGrid, L&T, Bajaj Finance and HDFC Bank, rising up to 3 per cent. Share of Reliance Industries too advanced up to 1 per cent ahead of its quarterly earnings, scheduled to be announced later in the day.

On the other hand, Bharti Airtel, Infosys, IndusInd Bank, HCL Tech, Asian Paints and Bajaj Auto fell up to 1 per cent.

In the previous session, the 30-share BSE Sensex surged to end 453.07 points, or 1.17 per cent, higher at 39,052.06. The broader NSE Nifty too spiked 122.35 points, or 1.07 per cent, to settle at 11,586.35.

According to experts, Indian markets also extended its gains partly owing to buoyant global markets, on the back of the Brexit news, and partly due to on ground earnings which are coming in better than anticipated. Investor sentiment is also upbeat after Finance Minister Nirmala Sitharaman hinted at further stimulus in FY20, they said.

Foreign institutional investors (FIIs) continued to be net buyers in the capital market, infusing Rs 1,158.63 crore on Thursday, while domestic institutional investors sold shares worth Rs 511.76 crore, data available with stock exchange showed.

Elsewhere in Asia, bourses in Hong Kong, Shanghai and Seoul were trading in the red, while those in Tokyo were in the green. The US markets finished higher on Thursday.

Brent futures, the global oil benchmark, fell 0.48 per cent to USD 59.62 per barrel. The rupee, meanwhile, depreciated by 3 paise against the US dollar to trade at 71.19 in early session. - PTI

9.40 am

Global markets

MSCI's broadest index of Asia-Pacific shares outside Japan was up about 0.1% in early trade.

 

Asian stocks stumbled on Friday after China posted its weakest growth in nearly three decades, countering a global lift in sentiment on the UK and European Union striking a long-awaited Brexit deal. MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.17 per cent by 0350 GMT, erasing earlier small gains. Australian shares dropped 0.61 per cent and Chinese blue-chips were of 0.65 per cent. Read the global stock markets report here

9.25 am

Stocks on focus

The board of Reliance Industries will meet on Friday to consider quarter and half-year results for the period ended September 2019. Apart from RIL, firms such as Ambuja Cements, Apollo Micro Systems, CDSL, Choksi Imaging, Duncan Engineering, ICICI Lombard General, Kirloskar Ferrous Industries, L&T Finance Holdings, L&T Technology Services, National Plastic Tech, QGO Finance, Sasken Tech, SNL Bearings, Stanrose Mafatlal, Sundaram Clayton and Visa Steel will declare their results.

BASF is teaming up with partners to study the feasibility of a petrochemicals complex in India worth up to $4 billion, which would be the world’s first-to-be fully powered by renewable energy. A Reuters report said that BASF had signed a MoU with Abu Dhabi National Oil Company, Adani Group and Borealis AG to further evaluate a collaboration to build the chemicals site in Mundra, Gujarat. BASF would foot roughly half of the overall investments. Shares of both BASF will remain in focus.

The respective buyback windows of Greaves Cotton, Automobile Corporation of Goa and Smartlink Holdings will open for subscription on Friday. Greaves Cotton plans to buy back 1.30 crore shares at ₹175 a share; Automobile Corporation of Goa aims to mop up 3.33 lakh shares at ₹600/share; and Smartlink Holdings to acquire 36.50 lakh shares at ₹130 a share. All the three offers will close on November 4, and would be through the tender route on proportionate basis.

9.15 am

Opening bell

The 30-share BSE index Sensex opened 35.77 points higher at 39,087.83 against the previous close of 39,052.06. While the 50-share NSE index Nifty opened 31.4 points lower at 11,554.95 against the previous close of 11,586.35

9.10 am

Day Trading Guide

₹1220 • HDFC Bank

S1

S2

R1

R2

COMMENT

1210

1195

1235

1250

Fresh long positions are recommended with a fixed stop-loss only if the stock advances above ₹1,235 levels

 

₹769 • Infosys

S1

S2

R1

R2

COMMENT

763

755

776

785

Initiate fresh short positions with a stiff stop-loss only if the stock of Infosys declines below ₹763 levels

 

₹245 • ITC

S1

S2

R1

R2

COMMENT

243

240

249

252

Consider initiating fresh long positions with a tight stop-loss if the stock of ITC moves beyond ₹249 levels

 

₹141 • ONGC

S1

S2

R1

R2

COMMENT

138

135

144

147

Fresh short positions are recommended with a stiff stop-loss only if the stock drops below ₹138 levels

 

₹1396 • Reliance Ind.

S1

S2

R1

R2

COMMENT

1370

1365

1410

1425

Near-term stance is bullish for the stock of RIL. Buy in declines with a stop-loss at ₹1,370 levels

 

₹265 • SBI

S1

S2

R1

R2

COMMENT

258

252

272

280

Initiate fresh long positions with a fixed stop-loss if the stock of SBI rebounds up from ₹258 levels

 

₹2030 • TCS

S1

S2

R1

R2

COMMENT

2015

2000

2050

2070

Consider initiating fresh long positions with a stiff stop-loss only if the stock of climbs above ₹2,050 levels

 

11600 • Nifty 50 Futures

S1

S2

R1

R2

COMMENT

11550

11500

11650

11700

As long as the contract trades above 11,550 the near-term view stays positive. Buy in dips with fixed stop-loss

 

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

9.00 am

Today's Pick

 

We recommend a buy in the stock of Indian Bank at the current levels of Rs 117.5. The stock jumped 7.8 accompanied by above average volume taking support in the band between ₹105 and ₹110. Both medium as well as short-term trends are down.

Trader with a short-term horizon and contrarian view can buy the stock with a stop-loss at ₹115.  Read our stock recommendation on Indian Bank here

Published on October 18, 2019