Sensex Ends 339 Points Lower After 1690-Point Swing On Trump Win, Modi Black Money Move Jolts
S&P 500 Futures fall 5 percent, trigger CME curbs barring more losses.
Closing Bell
Indian shares declined after Prime Minister Narendra Modi announced an unprecedented ban on high-denomination banknotes to curb black money. Then came the double whammy of Republican candidate Donald Trump pulling off a surprise win in U.S. presidential election, defeating opponent Hillary Clinton, who was widely seen as a market favourite.
The S&P BSE Sensex dropped 1.2 percent to 27,252 after falling as much as 6.1 percent in early trade. While NSE Nifty rebounded from the 8,000-mark, to close 1.3 percent lower at 8,432. The market breadth remained abysmal for the entire day, closing the day at 1,204 declines, 199 advances and 17 stocks remaining unchanged.
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Speciality Restaurants Reports Q2 Net Loss At Rs 2.57 Crore
Shares of the restaurant chain operator declined 4.3 percent after reporting a loss in its second quarter earnings.
The company posted a net loss of Rs 2.57 crore for quarter-ended September, compared to a Rs 1.02 crore profit in the year ago period. Net sales came in at Rs 79.63 crore for the three-month period, against Rs 79.68 crore year on year.
Lupin Q2 Net Income, Sales Miss Estimate; Stock Shed Gains
Shares the drug maker gave up most of its gains after reporting a miss in its second quarter earnings.
The Mumbai-based firm posted a net profit of Rs 662 crore for quarter-ended September, compared to an estimate of Rs 708 crore by analysts polled by Bloomberg. Net group sales also missed street expectations at Rs 4,290 crore.
The total costs of the company for the quarter stood at Rs 3,470 crore versus Rs 2,780 crore.
More details HERE
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DONALD TRUMP ELECTED 45TH U.S. PRESIDENT
Donald Trump pulled off a huge electoral upset to become the 45th president of the United States, a repudiation of the political establishment that’s jolting financial markets even as it promises to reshape the nation’s priorities and America’s relationship with the world.
Odds on the Fed hiking next month have plummeted to as low as 47 percent - that's from 82 percent at the end of trading in New York on Tuesday.
Trump as President Would Mean Gold’s Going Higher, Mint Says
A Donald Trump victory in the U.S. presidential election in November would probably lift gold prices, according to the mint that refines almost all the bullion output from one of the world’s biggest producers.
“If someone like Donald Trump does get himself elected, it will stimulate some fear within the economy as to where things are going,” Richard Hayes, chief executive officer of the Perth Mint, said in a Bloomberg TV interview. “Trump is very much a protectionist, he is very much for almost ‘Fortress America’.”
Read the full copy HERE
Godrej Properties Q2 Net Profit Slumps 77% YoY
Shares of the Mumbai-based firm fell 2.7 percent after disappointing street with its second quarter earnings.
It reported a net profit of Rs 23.48 crore for quarter-ended September, compared to Rs 103.91 crore same period last year. A Bloomberg poll of analysts’ estimates had pegged the figure at Rs 53.77 crore.
The stock was down 17.8 percent in opening trade but recovered most of its losses before the result announcement. (more details HERE)
Why Do the “Pundits” Get it So Wrong?
Bloomberg's Guy Johnson discusses the similarities between the U.S. election and Brexit with Bloomberg's David Gura and Megan Murphy on "Bloomberg Politics: Election 2016.
What Will A Trump Win Mean For Global Markets? Jefferies’ Sean Darby Answers
Sean Darby, chief global equity strategist at Jefferies, discusses the U.S. election and its impact on the markets. He speaks to Bloomberg's Yvonne Man on "Bloomberg Politics: Election 2016."
Stocks Bucking the Market Trend
- VA Tech Wabag (+4%)
- Swan Energy (+1.8%)
- Kushal Tradeline (+1.3%)
- Kennametal Industries (+1%)
- Honeywell Auto (+0.6%)
- Hindusthan National Glass (+0.3%)
- GSK Consumer Health (+0.4%)
Jewellery Stocks Decline
- Titan (-15 percent to Rs 315)
- Tribhovandas Bhimji (-19.4 percent to Rs 63)
- Rajesh Exports (-6.6 percent to Rs 436)
- Gitanjali Gems (-20 percent to Rs 56)
- Manappuram Finance (-20 percent to Rs 82)
- Muthoot Finance (-20 percent to Rs 290)
For more movers & shakers in market, click HERE
Market Update
- S&P 500 Futures fall 5 percent, trigger CME curbs barring more losses.
- Fed December rate hike odds drops below 50 percent, according to Bloomberg data.
- Nikkei extends drop to 5.2 percent; Hang Seng down 2.8 percent
- WTI crude down 3.9 percent to $43.2 a barrel; Gold gained 4.5 percent to $1,332 per ounce.
Indo-U.S. Ties Under A New U.S. President
Nomura Says Black Money Crackdown Will Boost Banking, Hurt Real Estate
Prime Minister Narendra Modi’s decision to discontinue Rs 500 and Rs 1,000 currency notes in circulation will boost tax revenues and dent consumption in the near-term, according to a report by brokerage firm Nomura.
It said the latest government measures to crack down on black money and corruption are a big medium-term positive for the Indian economy.
Read the full report HERE
Clinton Regains Lead; Market Recovers
Indian shares recovered some of their opening losses after Clinton overtook Trump after winning California and Washington. (Catch the latest poll updates HERE)
The Sensex recovered 3.5 percent from the day’s low, but is still down 2.8 percent at 26,857. The 50-share Nifty is down 2.7 percent to 8,300, after falling as much as 6.3 percent in opening trade.
Opening Bell
Indian shares dropped like nine pins after Prime Minister Narendra Modi’s government unexpectedly pulled out high-denomination banknotes and as early results from the U.S. election raised possibilities that Donald Trump may prevail over Hillary Clinton.
The S&P BSE Sensex declined 6.1 percent to 25,902 while the NSE Nifty lost 6.3 percent to 8,002. The market breadth was abysmal at 1,448 declines, 69 advances and 325 stocks remaining unchanged.
Except Dr. Reddy’s Labs (+0.4%), all 50 stocks on the Nifty declined led by Adani Ports (-6.5%), M&M (-6.9%), Tata Power (-6.4%), Ambuja Cements (-5.9%), BHEL (-6.1%) and Hindalco Industries (-6%)
Pre-Market Update
The S&P BSE Sensex dropped 4.8 percent to 26251 while the Nifty slumped 5.5 percent to 8,067. The rupee fell 0.2 percent to 66.7575 per dollar, while the SGX Nifty slumped a record 4.5 percent in Singapore, as the government’s move to abolish high-denomination banknotes are seen hurting shares of property developers, jewellery makers.
Stocks to Watch
- Apar Industries: Q2 net Rs 45.66 crore versus Rs 25.06 crore
- Biocon: Biocon, Mylan report FDA submission for proposed biosimilar
- DLF, Indiabulls Real, Housing Development, Unitech, Oberoi Realty: Real estate prices to fall after currency step, Equinomics says
- Hotel Leela: Delhi court upheld lower court order on royalty
- ICICI Bank: Believe alleged breach at ATMs of another bank
- Stock raised to hold vs reduce at Reliance Securities
- InterGlobe Aviation: Q2 net Rs 140 crore versus estimate Rs 179 crore
- Airline cuts A320neo fleet target to 20 from 24 for FY17
- KEC International: Keep evaluating various business opportunities
- Larsen & Toubro: In pact with Chiyoda for flue gas desulphurisation tech
- Mangalore Refinery: Q2 net Rs 416 crore versus loss Rs 913 crore y/y
- Mindtree: Rekha Nemish Shah bought 3.65 million shares yesterday; Amrit Petroleums sold 3.65 million shares, BSE says
- Nagarjuna Oil: To sell 47 percent stake in refinery unit to AMR Group
- Q2 loss Rs 183 crpre versus loss Rs 1.2 crore
- PTC India Financial: Q2 net Rs 84.9 crore versus Rs 210 crore
- Repco Home: Q2 net Rs 45.69 crore versus estimate Rs 47.27 crore
- Tata Communications: Q2 net Rs 39.96 crore versus estimate Rs 84.7 crore
- Titan, Tribhovandas Bhimji, Rajesh Exports, Gitanjali Gems, Manappuram Finance, Muthoot Finance: Jewellers in demand as Indians seek to dispose banned bank bills
- UFO Moviez: Q2 net Rs 20.26 crore versus Rs 16.46 crore
- Va Tech Wabag: Q2 net Rs 24.04 crore versus Rs 14.17 crore
Earnings to Watch
- Apollo Tyres
- Bosch
- Capital First
- Caplin Point Laboratories
- Cipla
- Edelweiss Financial Services
- FDC
- Godrej Properties
- Honeywell Automation India
- Indian Bank
- ITD Cementation India
- JK Tyre & Industries
- Karnataka Bank
- Kesoram Industries
- Larsen & Toubro Infotech
- Lupin
- Narayana Hrudayalaya
- Oracle Financial Services
- Oriental Bank of Commerce
- Pidilite Industries
- Polaris Consulting & Services
- Power Finance Corp.
- Power Grid Corp.
- Ramco Cements
- Ramco Systems
- Rural Electrification
- UCO Bank
- Ujjivan Financial Services
The Other Big Talking Points
- Swedish Enterprise Minister Damberg on India visit today
- India state-bonds yield spreads over federal debt widen
- Bertelsmann plans further investments in Brazil, India, China
- Global funds buy Rs 86.66 crore of local stocks; domestic funds buy Rs 294 crore yesterday: Provisional data
- British PM Theresa May says U.K. economy is ‘strong’ as IFS warns of budget hole
- Institute for fiscal studies sees $31 billion hit to finances
- Indian Hotels moves SC against auctioning of Delhi’s Taj Mansingh Hotel
PM Modi's Surgical Strike on Black Money
Taking its strongest step yet to bring down black money and corruption in the economy, the government has said that currency notes of the denomination of Rs 500 and Rs 1000 will no longer be legal tender.
Who Wins? Who Loses?
- Positve: Banks’ CASA deposit growth
- Negative: Real estate, jewellery, casinos (Delta Corp), autos (luxury cars), luxury hotels, housing finance companies with high LAP exposure (Indiabulls Hsg Fin, Dewan Housing, SCUF), indirect impact on real estate, cement & steel
Good Morning!
The Nifty Futures on the Singapore Exchange, an early indicator of Nifty’s performance in India, fell 3.4 percent to 8,266.
Asian markets gave up their early gains and slumped after Republican candidate Donald Trump overtook Democratic candidate Hillary Clinton. Mexico’s peso, often seen as a barometer for the U.S. presidential race, tanked 6.6 percent while the perceived safe haven assets like gold and yen surged.
To get the beat-by-beat coverage of the U.S. elections, click HERE
Clinton is seen as a continuity candidate, while Trump is a political novice who has advocated policies such as winding back free-trade agreements that could send jitters across markets.
The MSCI Asia Pacific Index lost 1.1 percent to 136.29, after rising as much as 0.8 percent. The dollar fell against the yen for the first time in four days as early results indicated the U.S. presidential election may be a tight race.
Futures on the S&P 500 Index tumbled 1.7 percent, having swung from gains of as much as 0.8 percent. Hong Kong’s Hang Seng Index slid 1.7 percent and China’s Shanghai Composite Index fell 0.3 percent, retreating from a 10-month high.
Crude oil prices dropped as much as 3 percent while gold extended its climbed 2.3 percent.