Sensex, Nifty Post 2nd Worst Fall Of 2016 As Investors Weigh Modi’s Cash Move, Trump Win
The Bloomberg Dollar Spot Index head near an 8-month high, having surged 2.6% this week.
Closing Bell
Indian shares fell most since February 11 as investors worried that a Donald Trump-led administration in the U.S. will spur capital outflows from the developing economies while weakening their exports.
Besides that, they also weighed the fallout of Prime Minister Narendra Modi’s decision to withdraw high denomination banknotes.
The S&P BSE Sensex declined 2.5 percent to 26,818 while the NSE Nifty dropped 2.6 percent to 8,296. The sellers dominated trade throughout the day as evident from the market breadth: 1,341 declined, 108 advanced and 21 stocks remained unchanged.
Sharmila Joshi of sharmilajoshi.com expects markets to correct further. “Yesterday’s bounce back was a bit of a surprise. With all this lingering uncertainty, the Nifty is likely to remain under pressure for another 2-3 weeks,” she told BloombergQuint in a phone conversation.
Joshi advises investors to buy at lower levels but continue remaining stock-specific. She is bullish on the non-banking and finance stocks.
Market Wrap
Indian Overseas Bank Extends Losses After Q2 Asset Quality Worsens
Shares of the state-owned lender dropped 4.1 percent after reporting its second quarter earnings.
The bank posted a net loss of Rs 765 crore for quarter-ended September, compared to a Rs 551 crore loss in the same period last year. Gross non-performing assets as a percentage of total advances, increased 129 basis points to 21.77 percent from 20.48 percent in the quarter ended June 30.
M&M Beats Street with 25% Rise in Q2 Net
Shares of the homegrown auto major pared some earlier losses after its second quarter earnings beat street estimates.
The automaker reported a net profit of Rs 1,163 crore for quarter-ended September, compared to Rs 915 crore in the same period last year. Net sales came in at Rs 11,364 crore, a jump of 15.6 percent year-on-year.
The EBITDA margin stood at 10.9 percent versus 10.3 percent YoY.
MFs See Rs 32,000 Crore Inflow in Oct, Rs 2.67 Lakh-Crore in FY17
According to the data from the Association of Mutual Funds in India (Amfi), investors have poured in a net Rs 32,334 crore in MF schemes last month as compared to Rs 16,071 crore in the preceding month.
The latest inflow has been mainly driven by contribution from income fund or debt schemes. Besides, equity schemes continued to witness positive inflow.
Overall, the asset under management of the country's 42 active fund houses increased to a historic high of Rs 16.3 lakh crore at the end of October from Rs 15.8 lakh crore in September-end.
Source: PTI
Muthoot Finance Q2 Net Beats Estimates; Stock Pares Losses
Shares of the gold loan company pared some of their losses reporting its second quarter earnings. The stock, which dropped as much as 9.2 percent, is now down 4.9 percent.
The South-based firm made a net profit of Rs 297 crore for quarter-ended September, which was higher than the Rs 274 crore estimated by a Bloomberg poll of analysts’ estimates.
Its total income came in at Rs 1,380 crore for the three-month period, compared to Rs 1,140 crore raised in the same period last year.
State Bank of India Slides After Q2 Asset Quality Worsens
Shares of the country’s largest lender slid 2.8 percent after its ratio of non-performing assets (or bad loans) worsened in the September quarter.
SBI reported a net profit of Rs 2,538 for the second quarter of the financial year, a drop of 35 percent year-on-year, and also slightly lower than the Bloomberg consensus analysts’ estimate of Rs 2,585 crore.
Gross non-performing assets as a percentage of total advances, increased 20 basis points to 7.14 percent from 6.94 percent in the previous quarter. Provisions grew 21 percent QoQ to Rs 7,669.66 crore.
The provision coverage ratio stood at 62.12 percent at the end of September 30, the bank said in a press release.
For a full report on SBI earnings, click HERE
VIP Industries Sinks After Muted Q2 Performance
Shares of the company fell as much as 5.86 percent to Rs 128.55 after it posted a muted second quarter performance.
Profit for the company grew to Rs 16.3 crore from Rs 15.2 crore in the year ago period while sales were largely flat at Rs 285 crore as against Rs 295 crore in the year ago period.
IPCA Pares Gains As Q2 Profit Misses Estimates
Shares of the pharmaceutical company reversed its gains after its second quarter missed analyst estimates.
Profit for the company came in at Rs 54.95 crore during the second quarter of the current financial year. Analysts tracked by Bloomberg had estimated the figure to be at Rs 76.6 crore.
The company’s total income for the quarter was at Rs 88.5 crore which was ahead of analyst estimates of Rs 85 crore.
Shares of the company were trading higher by 1.64 percent at Rs 603.90, after climbing to an intraday high of Rs 614, higher by 3.34 percent.
Capital First Approves Share Issue Plan
Shares of the private lender pared its losses from the day’s low after the board approved to issue, offer and alott 47.8 lakh equity shares to Caladium Investment Ptd. Ltd., an affiliate of Singapore’s sovereign wealth fund GIC at a price of Rs 712.70 per share, the company said in its exchange filing.
Shares of the company fell to an intraday low of Rs 611.70, down 4.47 percent before recovering to trade lower by 2.7 percent at Rs 623.05.
Ahead of Earnings
- Bank of Baroda (+3 percent to Rs 170)
- Jet Airways (India) (-2 percent to Rs 431)
- State Bank of India (+2.7 percent to Rs 288)
- Tata Steel (-1.6 percent to Rs 430)
- Mahindra & Mahindra (-2.1 percent to Rs 1,294)
- Bharat Petroleum Corporation (-2.2 percent to Rs 650)
- MOIL (-10.3 percent to Rs 311)
- Muthoot Finance (-6.6 percent to Rs 331)
- L&T Technology Services (-2.5 percent to Rs 770)
Rupee Drops to 7-Week Low
The rupee weakened 0.7 percent to 67.08 per dollar as of 9:38 a.m in Mumbai, according to prices from local banks complied by Bloomberg. It fell to 67.1050 earlier, the lowest level since September 21.
State-run banks sold dollars on behalf of the RBI to stem the local currency’s losses, two Mumbai-based traders, who did not wish to be identified, told Bloomberg News.
Opening Bell
Indian shares declined as gains in lenders and healthcare companies were countered by extended selloff in automakers, real estate developers and FMCG firms.
The S&P BSE Sensex dropped 0.9 percent to 27,262 while the NSE Nifty too fell 0.9 percent to 8,445. The market breadth was firmly in favour of the sellers at 1142 declines, 319 advances and 390 stocks remained unchanged.
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Stocks That Are Moving The Market: Sun Pharma, Tata Motors, SBI, M&M And More
Stocks to Watch
- Muthoot Finance to consider raising Rs 10,000 crore via NCDs
- Navneet Education to consider buyback of its shares
- Fitch: Limited impact of U.S. DOJ’s probe on Indian pharma
- Capital First to consider preferential issue of shares
- Binny Ltd.: To buy 37.20 mw wind farm from Mohan Breweries
- Tata Motors: October global wholesales +9 percent to 101,057 units
- Cements Stocks: Cement makers move COMPACT against CCI's Rs 6,700 crore penalty for indulging in cartelisation (Economic Times)
- ACC cut to reduce versus add at IIFL
- Ambuja Cements cut to reduce versus add at IIFL
- Shree Cement cut to add versus buy at IIFL
- Ultratech Cement cut to add versus buy at IIFL
Earnings to Watch
- Aarti Industries Q2 779m
- Alkem Laboratories Q2 2
- Andhra Bank Q2
- Apollo Hospitals Enterprise Q2
- AstraZeneca Pharma India Q2
- Bank of Baroda Q2
- Bharat Petroleum Corp. Q2
- Great Eastern Shipping Co. Q2
- Godfrey Phillips India Q2
- Indian Overseas Bank Q2
- IPCA Laboratories Q2 766m (12)
- Jet Airways India Q2
- Mahindra & Mahindra Q2
- Mahindra CIE Automotive Q3
- Merck India Q3
- MOIL Q2
- Muthoot Finance Q2
- Natco Pharma Q2
- Navneet Education Q2
- Novartis India Q2
- OnMobile Global Q2
- Rain Industries Q3
- Rajesh Exports Q2
- Reliance Power Q2
- SRF Q2
- State Bank of India Q2
- Sun TV Network Q2
- Suzlon Energy Q2
- TTK Healthcare Q2
- Tata Steel Q2
- Videocon Industries Q3
- VIP Industries Q2
Talking Points
- Prime Minister Modi to meet Japanese counterpart Abe in Tokyo, to review entire spectrum of bilateral cooperation
- Abe eyes India to cement high-speed rail dominance over China
- Tata steps up attack on Mistry as India’s biggest feud escalates
- Tatas’ conflict of interest allegation smear campaign: Mistry
- Bhaskar Bhat said to resign from Tata Chemicals board on Mistry: CNBC- TV18
- SEBI plans to cut listing time to four days: Sinha
- RBI bought net $4.65 billion of foreign exchange in September
- Venezuela’s PDVSA to clear ONGC Videsh’s dues with 17,000 bbl a day oil deal
- Iran assured to give Farzad-B on non-bidding route to ONGC
- India oil demand rebounds to highest in five months as monsoon ends
- RBI revises rules to treat some stressed assets as standard
- RBI modifies directions on setting up of IFSC banking units
- India sweet tooth just got more expensive as sugar output slides
- India, Thai sugar-cane harvest to get boost from weather: MDA
- Ukraine’s Nibulon sees another bumper wheat crop as rains return, nation could sell another 1 million to 1.5 million tonne to India
- Global funds sell Rs 733 crore of local stocks; domestic funds buy Rs 639 crore Thursday: Provisional data
- Trump’s tax-cut plan would benefit emerging markets, says Mark Mobius
Good Morning!
The Nifty Futures on the Singapore Exchange, an early indicator of Nifty’s performance in India, fell 1.5 percent to 8,416.
Asian stocks were mixed this morning amid concern that the polices of a Donald Trump-led administration in the U.S. will spur capital outflows from the developing economies while weakening their exports.
More than $1 trillion was wiped off the value of bonds this week, something that’s happened only once before in the last two decades, according to Bloomberg data. Traders see an 80 percent probability of a quarter percentage-point hike at the Fed’s December meeting.
The Bloomberg Dollar Spot Index head near an eight-month high, having surged 2.6 percent this week.
On Thursday, U.S. stocks closed higher with the Dow Jones hitting a record high, as banks and pharma stocks lapped up the perceived benefits of President-elect Donald Trump’s victory, while tech stocks sank on worries about his foreign policy initiatives.
Most industrial metals rallied on speculation that commodities used to build everything from airports to bridges will benefit under Trump’s presidency.
Oil fell for the second day in a row over skepticism about OPEC’s (Organization of the Petroleum Exporting Countries) ability to re-balance crude supplies. The International Energy Agency warned that prices would continue to fall amid “relentless” global supply growth unless OPEC enacts significant output cuts.
OPEC members are set to meet on November 30 to finalise the details of a production cut that was agreed to by members in late September.