Sensex drops 416 points to close at 41,528; Kotak Bank, TCS, RIL slide

Nifty tumbles 121 points to 12,230

 

4:00 pm

Closing bell

The benchmark indices, the BSE Sensex and the NSE Nifty, closed about one per cent lower on Monday, after hitting record highs in early trading.

The Sensex tanked 416.46 points or 0.99 per cent ts to end at 41,528.91, while the Nifty plunged 121 points or 0.98 per cent to 12,230.75.

The top gainers in the Sensex pack were PowerGrid (up 3.75 per cent), Bharti Airtel, ITC, Asian Paints and ICICI Bank (which gained between 0.70-1.9 per cent). The laggards were Kotak Bank (down 4.70 per cent), followed by Reliance, ONGC, TCS and NTPC.

3:45 pm

European shares dip as investors eye PMI data, ECB meeting

 

European shares retreated on Monday after striking a record closing high in the previous session, as investors paused before launching into a week packed with economic data and the European Central Bank's first policy meeting of the year.

The pan-European STOXX 600 index was down about 0.3 per cent, after gaining nearly 1 per cent on Friday on optimism around US-EU trade talks to address long-standing issues such as a French digital tax and aircraft subsidies. Click here to read in full the European markets report.

3:15 pm

Federal Bank Q3 net up 32% at Rs 440.64 cr

 

Private sector Federal Bank reported a 32.07 per cent increase in its net profit in the third quarter of the fiscal led by strong revenue and stable asset quality.

Net profit rose to Rs 440.64 crore in the quarter ended December 31, 2019 as against Rs 333.63 crore in the corresponding quarter last fiscal. Total income grew by 13.3 per cent to Rs 3,738.22 crore, as against Rs 3,299.96 crore in the same period a year ago. Click here to read in full the Federal Bank results report.

2:45 pm

Dollar holds gains as investors cheer US economic outlook

File Photo   -  Reuters

 

The dollar held near a one-month high against major currencies on Monday after last week's run of data confirmed that the US economy is holding up well, while China's yuan hit a new six-month high.

Mostly though it was another quiet start to the week for currencies, with FX volatility near all-time lows and little in the way of key economic data. Click here to read in full the global forex markets report.

 

2:25 pm

Oil rises to more than a week high after Libyan outage

 

Oil prices rose to their highest in more than week on Monday after two large crude production bases in Libya began shutting down amid a military blockade, setting the stage for crude flows from the OPEC member to be cut to a trickle.

Brent crude futures were up by 70 cents, or 1.11 per cent, to $65.55 by 0731 GMT, having earlier reached $66 a barrel, the highest since January 9. The West Texas Intermediate contract was up by 56 cents, or 1 per cent, at $59.10 a barrel, after rising to $59.73, the highest since January 10. Click here to read in full the oil markets report.

 

2:11 pm

 

1:20 pm

Sensex, Nifty extend losses

The benchmark indices, the BSE Sensex and the NSE Nifty, extended their losses in the afternoon session on Monday.

The Sensex fell 322 points or 0.77 per cent to 41,623. The Nifty dropped 99 points or 0.87 per cent to 12,253.

The top gainers on the Sensex were Power Grid, Bharti Airtel, ICICI Bank, Asian Paints and Larsen & Toubro. TCS and Reliance were the top losers, dropping 2.3 per cent each, followed by Kotak Bank, which dropped 2.2 per cent, and HDFC Bank and IndusInd Bank, which dropped over 1.7 per cent.

Among the BSE sectoral indices, the energy index dropped 1.87 per cent in the session. The other notable losers were the IT and banking sector index. Technology sector shares were also down nearly 1 per cent.

1:05 pm

Asian shares pause near 20-month top, oil jumps on Libya shutdown

Asian shares held near a 20-month top on Monday even as investors took some money off the table following a strong run recently, while oil jumped to more than a one-week high after two large crude production bases in Libya began shutting down.

In early European trades, the pan-region Euro Stoxx 50 futures, German DAX futures and FTSE futures each added 0.1 per cent, while E-Mini futures for the S&P 500 inched up slightly. Click here to read in full the Asian markets report.

12:35 pm

Sensex, Nifty slump

The benchmark indices, the BSE Sensex and the NSE Nifty, shed their early gains to fall into the red at the mid-session on Monday.

The Sensex dropped 178 points or 0.48 per cent to trade at 41,767, while the Nifty lost 59 points or 0.48 per cent to quote at 12,292.

The top gainers in the Sensex pack were PowerGrid, which rose 3.6 per cent, followed by ICICI Bank, Asian Paints, Bharti Airtel and ITC (which rose 0.70-1.70 per cent).

Tata Consultancy, which dropped nearly 2 per cent in the session, led the laggards. The other notable losers included Reliance, Kotak Bank, Axis Bank and Sun Pharma (which dropped between 1.20-2 per cent).

Among the BSE sectoral indices, telecom, utilities and power gained more than 1 per cent during the session, while the energy and infotech sectors dropped appreciably.

Earlier, the Sensex and Nifty opened at record peaks on Monday, tracking strong quarterly results by Reliance Industries and HDFC Bank. The Sensex rallied over 300 points to hit a fresh lifetime high of 42,273.87, while the broader NSE Nifty scaled an all-time high of 12,430.50.

12:20 pm

Supreme Court seeks response of Centre, EC on plea seeking stay on electoral bond scheme

 

The Supreme Court on Monday sought the response of the Centre and the Election Commission on a plea seeking stay on the electoral bond scheme meant for funding political parties. The top court, however, refused to grant an interim stay on the electoral bond scheme. Click here to read more on the plea for stay on electoral bonds.

11:45 am

TCS falls over 2 per cent after Q3 earnings

 

The scrip of Tata Consultancy Services (TCS) on Monday fell over 2 per cent after the company reported muted growth in consolidated net profit for the third quarter ended December 2019.

On the BSE, the stock declined 2.14 per cent to Rs 2,170.50. On the NSE, the scrip dropped 2.34 per cent to Rs 2,167.

The country’s largest software services major, after market hours on Friday, reported a muted 0.2 per cent growth in consolidated net profit at Rs 8,118 crore for the third quarter ended December 2019.

This is against a net profit of Rs 8,105 crore in the year-ago period, TCS said in a BSE filing.

Revenue grew 6.7 per cent in the quarter under review to Rs 39,854 crore from Rs 37,338 crore in the corresponding period of the last fiscal, it added.

11:35 am

In big revamp, TCS reduces service offerings by 50 per cent

 

Tata Consultancy Services is faced with a tough period with slower growth rates over the last two quarters. India’s largest IT services firm reported a flat growth in profit for the third quarter ended December 31, 2019 at ₹8,118 crore compared with ₹8,105 crore last year, as key sectors, including BFSI and retail, face headwinds. BusinessLine met Rajesh Gopinathan, CEO, TCS, to understand how he is steering the company through this period. Click here to read in full the interview with Rajesh Gopinathan.

11:15 am

Dollar holds gains as investors cheer US economic outlook

File Photo   -  Reuters

 

The dollar began the week on a firm note on Monday as economic data pointed to strength right across the US economy, reducing the likelihood of interest rate cuts.

The greenback held steady near a one-week high against the euro, at $1.1096, and just below an eight-month peak on the Japanese yen, at 110.19 yen per dollar.

“People are just searching out good news across the world,” said Chris Weston, Head of Research at Melbourne brokerage Pepperstone. Click here to read in full the dollar report.

11:00 am

Oil surges as Libyan pipeline shutdown cripples output

 

Oil prices jumped on Monday after two large crude production bases in Libya began shutting down amid a military blockade, setting the stage for crude flows from the OPEC member to be cut to a trickle.

Brent crude futures were up by 75 cents, or 1.2%, to $65.60 by 0109 GMT, having earlier reached $66.00 a barrel, the highest since Jan. 9. The West Texas Intermediate contract was up by 60 cents, or 1%, at $59.14 a barrel, after rising to $59.73, the highest since Jan. 10. Click here to read in full the global oil markets report.

10:45 am

Asian shares camp on high ground, oil jumps on Libya shutdown

 

Asian shares neared a 20-month top on Monday as Wall Street extended its run of record peaks on solid US economic data and lashes of liquidity from the Federal Reserve.

Oil prices jumped as oilfields in southwest Libya began shutting down after forces loyal to Khalifa Haftar closed a pipeline, potentially reducing national output to a fraction of its normal level.

Early turnover in Asian shares was light with US stock and bond markets closed for the Martin Luther King Jr. holiday. Click here to read in full the Asian markets report.

10:35 am

Benchmark indices hit record highs

The Sensex and Nifty opened at record peaks on Monday, tracking strong quarterly results by index heavyweights Reliance Industries and HDFC Bank.

After rallying over 300 points to hit a fresh lifetime high of 42,273.87, the 30-share BSE index pared gains to trade 31.32 points or 0.07 per cent higher at 41,976.69.

Similarly, the broader NSE Nifty scaled an all-time high of 12,430.50, up 0.63 per cent. It, too, pared early gains to trade marginally higher.

PowerGrid was the top gainer in the Sensex pack, rallying up to 4 per cent, followed by ITC, Asian Paints, M&M and HDFC.

Shares of Reliance Industries (RIL) and HDFC Bank jumped up 2 per cent in early session, following the announcement of their corporate earnings over the weekend.

RIL on Friday posted a record quarterly net profit of Rs 11,640 crore as a turnaround in the oil refining business, together with the continued rise in the share of its consumer businesses of retail and telecom, countered lower profitability in petrochemicals.

HDFC Bank on Saturday reported a 32.8 per cent growth in net profit to Rs 7,416.5 crore for the third quarter ended December 31, driven by interest and non-interest income.

On the other hand, TCS was the top laggard, shedding over 1 per cent, after the country’s largest software exporter reported a flat December quarter net profit at Rs 8,118 crore, and also made it clear that it will not be able to notch double-digit revenue growth in 2019-20.

HCL Tech, Kotak Bank and Hero MotoCorp, too, fell up to 1.44 per cent.

According to traders, domestic investors are reacting to corporate results released after market hours last week, and also booking profits at higher levels.

Bourses in Shanghai, Tokyo and Seoul were trading on a positive note in their early sessions, while Hong Kong was in the red.

Brent crude oil futures rose 0.14 per cent to $65.59 per barrel.

Meanwhile, the rupee was trading flat at 71.06 against the US dollar in morning session.

In the previous session, Sensex settled 12.81 points, or 0.03 per cent, higher at 41,945.37, while the Nifty ended 3.15 points, or 0.03 per cent, down at 12,352.35.

Meanwhile, on a net basis, foreign institutional investors bought equities worth Rs 264.26 crore, while domestic institutional investors offloaded shares worth Rs 500.17 crore on Friday, data available with stock exchanges showed. - PTI

10:25 am

Daily rupee call: Go short on rupee with stop-loss at 70.7

 

The rupee (INR) has breached the consolidation range between 70.7 and 71 against the dollar (USD). Last Friday, it closed at 71.08, opening the door for further weakness. It has also broken below the 23.6 per cent Fibonacci retracement level of the previous bull trend. Notably, the one-year forward spread of the USDINR currency pair has stabilised around 300 points. Click here to read in full the Daily rupee call.

10:05 am

Rupee slips 4 paise to 71.12 against US dollar amid rising crude prices

 

The rupee opened on a weak note and declined 4 paise to 71.12 against the US dollar in opening trade on Monday, as concerns over rising crude oil prices weighed on the investor community.

Forex traders said the weakness in the rupee was largely due to a spurt in crude oil prices following rising tensions in West Asia and North Africa. Click here to read in full the rupee report.

9:45 am

Weekly Trading Guide: ITC fails to extend the rally

SBI (₹318)

The stock of SBI faced considerable selling pressure, and the price fell throughout last week. However, the support at ₹310 arrested the decline and the stock recouped some of its losses, before closing the week at ₹318. Thus, the stock has broken below the range between ₹325 and ₹340, giving it a bearish outlook. It has also slipped below the 23.6 per cent Fibonacci retracement level.

 

 

Adding to the bearish outlook, the daily relative strength index is showing fresh downtick and has broken below the midpoint level of 50. The moving average convergence divergence indicator in the daily chart is hinting a negative outlook, as it has entered the bearish territory. All these factors point to a further weakening in price. However, from a trading perspective, it is not recommended to initiate fresh short positions at current levels, as ₹310 has been acting as a substantial support. Notably, the price has bounced thrice from that level since December 2019. Thus, traders can go short once the price decisively breaks below ₹310 for potential targets at ₹298 and ₹292 with a tight stop-loss.

ITC (₹239.9)

Continuing with its recent bullish bias, the stock opened last week on a front foot. It moved past the 21-day moving average, breached the hurdle at ₹242 and rallied past the 23.6 per cent Fibonacci retracement level of the previous bear trend. The stock made a higher peak in the daily chart and registered a three-week high of ₹243.8. However, it was not able to build a sustainable rally as it faced the 50-day moving average resistance at ₹244, from where it declined. The stock gave up its entire gain and closed the week flat at ₹239.9 versus its previous weekly close of ₹238. The daily relative strength index has fallen back below the midpoint level of 50 as the price moderated towards the end of the week, but the moving average convergence divergence indicator in the daily chart remains in the bullish region. If the bulls regain traction and the price closes above the 50-day moving average, the stock can be expected to rally further. Until then, the outlook seems uncertain. From the trading perspective, it is recommended to initiate fresh long positions above the 50-day moving average.

Infosys (₹767.8)

The stock of Infosys rallied last week after facing a correction during the week before. It bounced from the 50-day moving average support at ₹710. The stock has closed above the key resistance at ₹760, which coincides with the 61.8 per cent Fibonacci retracement level. Thus, in the daily chart, it continues to form higher highs, indicating considerable bullish momentum. The daily relative strength index continues to form fresh upticks following the price; the moving average convergence divergence indicator in the daily chart stays in the positive region. Both are positive indications hinting further strengthening of the stock. Hence, traders are advised to initiate fresh long positions on declines and place a dynamic stop-loss. While the initial stop-loss can be at ₹740, shift it upwards with a gap of 1.5 times the daily Average True Range as the stock appreciates. The 21-day moving average coincides with ₹740, making it an important support. On the upside, the immediate resistance is at the round number ₹800. Above that level, the resistance is at ₹818.

RIL (₹1,581)

Reliance Industries seems to have resumed its uptrend after a sluggish period that lasted for a month. The stock price moderated during the first half of last week, but it rebounded in the second half strongly from ₹1,530 levels, where the 21- and 50-day moving averages coincide. The stock has also breached an important resistance at ₹1,575, opening the door for further appreciation. Corroborating the upward bias, the daily relative strength index is showing a fresh uptick, and has comfortably moved above the midpoint level of 50. Also, the moving average convergence divergence indicator in the daily chart is showing signs of recovery and has entered the bullish territory. Traders are thus recommended to buy the stock on declines with a dynamic stop-loss. While the initial stop-loss can be placed at ₹1,540, move it on the upside with a gap of 1.5 times the daily Average True Range as the stock advances. The stock will most likely retest its lifetime high at ₹1,617.5, beyond which it might even rally towards the resistance band between ₹1,690 and ₹1,700.

Tata Steel (₹495.2)

The stock of Tata Steel inched up last week, extending its recent rally. It now faces a considerable resistance at ₹500. Importantly, the 50 per cent Fibonacci retracement level of the downtrend that extended between early 2018 and late 2019 is at ₹500, making it a significant level. Thus, for the stock to rally further, it must decisively breakout beyond it. Bulls should be cautious as there are indications of a weakening rally, in addition to the resistance. The daily relative strength index is hovering around the over-bought levels, and when the price formed new highs, the index did not form new highs. The moving average convergence divergence indicator in the daily chart is flat despite the rally. Also, as shown by a falling Average True Range, the trading range has been narrowing for the past few trading sessions, which can be an indication of a loss in the bullish momentum. Thus, from a trading perspective, recommendation is to go long in the stock only if it closes above ₹500 and place a stop-loss at ₹485. On the upside, the resistance levels are at ₹515 and ₹530.

9:30 am

Big Story: What India Inc needs from Budget 2020-21

 

As Nirmala Sitharaman gets ready to present Budget FY2021, expectations are running high. We take stock of the current state of key sectors and look at measures that can give a boost. Click here to read in full the Big Story.

9:15 am

Opening bell

The benchmark indices, the BSE Sensex and the NSE Nifty, opened the week on a firm note.

The Sensex jumped 120 points to 42,066, while the Nifty was quoted at 12,378, up 26 points.

9:00 am

Index Outlook: The Sensex and the Nifty edge higher...

 

After an initial rally in the early part of last week, the Sensex and the Nifty turned volatile but ended the week on a positive note. The third-quarter earnings will continue to be the highlight in the coming week and can trigger stock-specific movements.

Now that the Phase 1 trade deal between the US and China has been signed, global investors will focus on the policy rate decisions across the globe. Bank of Japan (BOJ), Bank of Canada (BOC) and European Central Bank (ECB) rate decisions are key global events to look forward to. Click here to read in full the Index Outlook on the Sensex and Nifty.

 

Published on January 20, 2020