Sensex, Nifty Fall Most Since Brexit Vote As Investors Fear End Of Loose Monetary Regime
Indian shares drop most since Brexit vote, dragged by selling across the board, barring some IT stocks.
Closing Bell
Indian shares dropped most since the Brexit vote on June 24, as the central banks in the world’s biggest economies questioned the benefits of loose monetary policy.
The losses follow a 2.5 percent tumble on the S&P 500 Index on Friday as volatility surged after an U.S. Fed official said the economy could overheat if policy makers waited too long to raise interest rates, spurring bets on an increase by the end of the year.
The S&P BSE Sensex lost 1.5 percent to 28,353; while the NSE Nifty declined 1.7 percent to 8,715. The market breadth was abysmal at 1260 declines, 188 advances and 53 stocks remaining unchanged.
Omaxe Q1 Net Jumps Over Two-Fold
Shares of Omaxe rose but quickly gave up their gains in a volatile market after it posted a two-fold jump in net profit for quarter-ended June.
It made a net profit of Rs 45.45 crore, a jump of around 160 percent from the same period last year.
The firm clocked consolidated revenue of Rs 436.13 crore, up 42.4 percent compared to corresponding quarter last year. Earnings before interest, depreciation and amortisation margins expanded 310 basis points to 22.54 percent.
Bajaj Hindusthan Falls After Posting Q1 Net Loss
Shares of the sugar maker fell as much as 4.1 percent to Rs 17 after it reported a Rs 77.38 crore net loss for the June quarter. It had made a profit of Rs 104 crore for the same period last year.
It clocked sales of around Rs 1,330 crore, down around 16 percent year-on-year.
Subex Rebounds After Posting Q1 Profit
Shares of communications services provider rebounded after posting Rs 6.37 crore profit for June quarter, compared to a Rs 17.61 crore loss same period last year.
It clocked net sales of around Rs 76.73 crore, up around 19.5 percent year-on-year.
The stock went up as much as 5.8 percent to Rs 13.5 reversing its earlier 5.5 percent intraday losses.
European Shares Extend Decline
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PSU Banks Fall Most After Fitch Sounds Basel III Warning
Shares of banking companies, especially the state-owned ones, dropped after rating agency Fitch said they are most at risk of breaching capital triggers due to poor buffers and weak prospects of raising funds for implementation of Basel III.
State banks are heavily reliant on the government for capital. Sharply deteriorating financial profiles have raised the standalone credit risks of state banks over the last year.Fitch wrote in a note.
Rupee Extends Fall To Third Day
The rupee weakened by 25 paise to 66.93 against the dollar in early trade at the Interbank Foreign Exchange market today, falling for the third straight session, as the dollar firmed up against some currencies overseas amid a lower opening in the domestic equity market.
Forex dealers said apart from sustained demand for the American currency from importers, foreign fund outflows and dollar’s gains against other currencies overseas, also weighed on the rupee.
On Friday, the local currency had plummeted by 26 paise to end at 66.68, posting its biggest single-day drop in five weeks, on renewed demand for the American currency from banks and importers.
From PTI
Opening Bell
Indian shares declined most since Britain voted to leave the European Union on June 24, as the central banks in the world’s biggest economies questioned the benefits of loose monetary policy.
The S&P BSE Sensex dropped as much as 1.9 percent to 28,251; while the NSE Nifty lost 1.9 percent to 8,699. The market breadth was abysmal at 1,291 declines, 175 advances and 373 stocks remaining unchanged.
Infosys(+1.4 percent) and Tech Mahindra (+1.3 percent) are the only two advancing stocks on the Nifty.
Market Movers: Welspun, ICICI Bank, Tata Motors and More
Data to Watch
- 5:30pm: July industrial output YoY; estimate 1.5 percent (prior 2.1 percent)
- 5:30pm: August CPI YoY; estimate 5.20 percent (prior 6.07 percent)
- 09/12-09/30: Q2 BoP current account balance, estimate $2.65 billion (Prior -$0.30 billion)
IPO Watch
- Larsen & Toubro’s offer for L&T Technology shares in IPO opens today, closes September 15.
*Raised Rs 268 crore, selling 3.12 million shares to anchor investors at Rs 860 each
- BSE to offer up to 29.96 million shares in IPO: DRHP
Earnings to Watch
- Tata Steel
- BGR Energy Systems
- Bajaj Hindusthan Sugar
- Alok Industries
- Gammon India
- Gitanjali Gems
- HBL Power Systems
- Hindusthan National Glass & Industries Limited
- Lycos Internet
- National Aluminium Company
- NLC India
- Omaxe
- MBL Infrastructures
- Metalyst Forgings
- Premier Polyfilm
- Reliance Power
- SEL Manufacturing Company
- Subex
Stocks to Watch
- Welspun India: Wal-Mart To Stop Selling Welspun’s Egyptian-Cotton Sheets.
- Tata Motors: Tata group wholesale sold 86,288 units in August 2016, up 16 percent.
- HDFC: HDFC Ergo acquires 100 percent stake in L&T General Insurance company for Rs 551 crore.
*Also completed second issue of rupee-denominated bonds worth Rs 500 crore
- Sun Pharma: Staff to go on strike.
*500 medical representatives earlier employed with Ranbaxy and now Sun Pharma, planning a pan-India strike to protest non-payment of salaries and other measures. (Business Standard)
- HPCL: Planning to double refining capacity to 60 million tonnes.
*Will do capex of Rs 6,862 crore for FY17 and Rs 55,000 crore for next five years. (Economic Times)
- Redington India: To begin the sale of iPhone 7 and 7 plus in 3,000 retail locations from October 7. (Financial Express)
- MRPL: Plans 100 retail outlets; JV with Gulf Oil yet to take off.
For a complete list of stocks to watch, click HERE
Talking Points
- India’s $208 million 2008 Embraer deal under scanner for alleged graft
- India removes actual user condition for urea import
- Government will decide on Cairn India Barmer permit extension by October 14
- India monsoon-sown crop acreage 105.4 million hectares as of September 9
- India bans using Samsung Galaxy Note 7 during flights: DGCA
- Bharti Airtel to provide more interconnection ports to Reliance Jio
- High speed Talgo completes Delhi-Mumbai journey in less than 12 hours
- Deutsche Bank joins October India rate-cut calls on CPI easing
- Forex reserves rise $989.5 million to $367.8 billion in week to September 2: RBI
- Global funds sold Rs 315 crore of local stocks; domestic funds sold Rs 328 crore on September 9: Provisional data
Good Morning!
The Nifty Futures on the Singapore Exchange, an early indicator of Nifty performance in India, declined 1.6 percent to 8,767.
On Friday. U.S. stocks fell in the worst selloff since Britain voted to leave the European Union, with the Dow Jones Industrial Average falling almost 400 points after a Federal Reserve official signaled more willingness to raise interest rates.
This after European Central Bank President Mario Draghi downplayed the need for more stimulus measures earlier last week.
Asian equities followed sell off in U.S. and European shares along with oil as investors fear the central banks in the world’s biggest economies questioned the benefits of loose monetary policy.
The Fed meets in Washington Sept. 20-21, with the probability of a hike then at 30 percent, from 20 percent a month ago, according to Fed funds futures tracked by Bloomberg.
Oil dropped the most in more than a month after the biggest U.S. stockpile slump in 17 years was seen as a one-off caused by a tropical storm that disrupted imports and offshore production.