KEY HIGHLIGHTS
Prime Minister To Address The Nation Tonight
Markets At Close
- Benchmark indices end lower for second day led by Reliance Industries, despite last hour recovery
- Nifty ends 0.46 percent lower at 9,196 - 153 points off day's low of 9,043
- Nifty futures trade at a premium of 29 points
- Sensex ends 0.6 percent lower at 31,371 - 527 points off day's low of 30,844
- Nifty Bank ends 0.46 percent lower at 18,862 - 575 points off day's low of 18,287
- Nifty Midcap and Smallcap Indices end 0.7 percent lower
- Nifty Auto, Nifty FMCG recover from day's low to end with gains of 0.5 and 0.7 percent respectively
- Nifty Pharma ends as top sectoral laggard; down 0.65 percent
- Vedanta ends as the top Nifty gainer; up 12.44 percent
- Reliance Industries ends as the top sectoral laggard; down 5.73 percent
- 702 stocks ended the day with gains while 1,063 stocks ended with losses
RIL Single Handedly Takes The Indices Lower
Earnings Fineprint: Bandhan Bank Q4FY20
The private lender reported a net profit of Rs 517.28 crore as compared to Rs 650.87 crore during the same period last year.
The bank's Net Interest Income grew 33 percent compared to last year at Rs 1,680 crore.
Asset quality remained stable with Gross NPA at 1.48 percent from 1.93 percent in the previous quarter while Net NPA improved to 0.58 percent from 0.81 percent last quarter.
The stock recovered from the day's low to end 1.65 percent lower at Rs 235.90.
Closing Bell: RIL Drags Benchmarks Lower
Indian equity markets ended lower for the second straight day, dragged lower by the heavyweight Reliance Industries. Most European markets have recovered from the day's low, as have the futures on the Dow Jones which are now lower by 50 points.
The S&P BSE Sensex index ended 0.6 percent lower at 31,371 while the NSE Nifty 50 failed to hold the 9,200 mark, ending 0.5 percent lower at 9,196.
Among sectoral Indices, the Nifty Media index ended as the top gainer with gains of 1.6 percent. The Nifty Metals index too ended 1.3 percent higher, led by gains in Vedanta.
Market breadth saw a slight recovery but stayed in favour of the declines. 688 stock on the NSE ended with gains while 1,064 ended with losses.
Stock Update: Reliance Industries
- Top laggard on the Nifty 50 index
- Falls as much as 6.5 percent to Rs 1,474
- Snaps five-day gaining streak
- The five-day gaining streak was the longest in three months
- Biggest one-day drop since March 23, 2020
- Today's volumes are 1.2 times higher than its 30-day average
- The stock is contributing 86 points to the Nifty downside
- 28 out of the 35 analysts tracking the stock have a buy recommendation; 3 sell calls
- Return potential of the stock as per Bloomberg data is 7.3 percent
Trading Ideas From Brijesh Bhatia Of Dealmoney Securities
- Buy Nifty Bank futures at 18,750 - 18,800 for target of 19,395 and stop loss of 18,445
- Buy ICICI Bank at Rs 320 for target of Rs 340 and stop loss of Rs 312
- Buy Jubilant Foodworks at Rs 1,580 for target of Rs 1,680 and stop loss of Rs 1,540
Large Trade Alert: Hindustan Unilever
16 lakh shares of the FMCG major exchanged hands in a large trade on the National Stock Exchange as per Bloomberg data.
Buyers and sellers in the trade were not immediately known.
Shares currently trade 1.6 percent lower at Rs 2,014. The stock has declined in 9 out of the last 10 sessions.
Today's volumes are 1.6 times higher than its 30-day average. The stock has also broken below its 50-Day Moving Average at Rs 2,032.28.
Stock Update: Ambuja Cements
The Board of Directors at its board meeting held today have declared an interim dividend of Rs 1.50 per equity share of Rs 2 each. This dividend is for the year 2019.
The record date for the same has been fixed as May 20. The proposal will be put to vote at the company's AGM, the date for which will be communicated later, as per the company's press release.
Shares currently trade 0.8 percent higher at Rs 175.30 and are up for the sixth straight day. This is the longest gaining streak for the stock since October 2019.
Stock Update: GE Power India
- Down for the seventh straight session
- Fell as much as 6.2 percent to Rs 375
- Trades at the lowest level since April 2014
- Longest losing streak since September 2018
- Down 12 percent in the last 7 trading session
- Today's volumes are 68 percent below its 20-day average
- Stock has entered oversold territory with Relative Strength Index (RSI) at 24
- Resumed production at its Noida factory today after obtaining permissions
Trading Ideas From Amar Singh Of Angel Broking
- Buy Aurobindo Pharma at Rs 670 for target of Rs 715 and stop loss of Rs 647
- Buy Bharti Airtel at Rs 540 for target of Rs 583 and stop loss of Rs 523
Stock Update: ACC
The Board of Directors of the cement company at a meeting held today have approved an interim dividend of Rs 14 per share for the year 2019.
The record date for the same has been set at May 20. The same will be put to vote at the company's AGM.
However, the company has not announced the date for its AGM, saying that it will be communicated in due course due to the prevailing Covid-19 situation.
Shares recovered from the day's low and are currently trading 0.3 percent lower at Rs 1,166.
Stock Reaction: Seamec
The company informed the exchanges that its vessel SEAMEC-III will be deployed end-July or early-August after it completes dry docking.
The vessel is in contract with HAL Offshore Ltd. for a period of two years. The aggregate of the contract is $23 million.
Another vessel of the company, SEAMEC Princess has been contracted with L&T Hydrocarbon to work at the Mumbai High offshore. The 20-day contract has a total of Rs 8.07 crore.
Shares are locked in an upper circuit of 5 percent at Rs 314.95.
Markets At 2:10 P.M.
- Benchmark indices fluctuate from the day's low
- Nifty down 1.4 percent at 9,111
- Sensex down 1.5 percent at 31,077
- Nifty Bank down 2.5 percent to 18,473
- Nifty midcap Index down 1.1 percent
- Nifty Smallcap Index down 1.2 percent
- India Volatility Index little changed at 38.09
- Nifty I.T. index gives up gains; Nifty Metal Index turns positive
- Nifty PSU Bank index down 2.2 percent
- Vedanta remains top Nifty gainer; up 9 percent
- Reliance Industries top Nifty laggard; down 4 percent
- 1,227 stocks on the NSE trade with losses while 500 gain
Money Market Update
The rupee managed to recoup early session losses to end stronger after being poised for a second session of declines.
The currency ended at 75.50 against the U.S. Dollar as compared to Monday's close of 75.73.
Despite the gains, the rupee still underperformed major Emerging Market peers like the Indonesian Rupiah, Thai Baht and the South Korean Won.
Yield on the 10-year government securities ended nearly flat at 6.166 percent as compared to Monday's close of 6.17 percent.
Stock Update: Vedanta
- Top gainer on the Nifty 50 index
- Gains as much as 7.4 percent to Rs 85.5
- Up for the second straight day
- Gains over 10 percent in the last two sessions
- Today's volumes are 2.7 times higher than its 30-day average
- Breaks above its 50-Day Moving Average of Rs 83.73
- Subsidiary Hindustan Zinc to consider dividend today
- 9 out of the 20 analysts tracking the stock have a buy recommendation; 2 sell calls
- Return potential of the stock as per Bloomberg data is 41.8 percent
Earnings Expectations: Nestle India Q1CY20
- Revenue seen 3.2 percent higher at Rs 3,098 crore
- Ebitda seen 3.7 percent lower at Rs 720 crore
- Ebitda Margin seen narrowing to 23.2 percent from 24.9 percent
- Net profit seen 10.6 percent higher at Rs 512 crore
- All estimates are standalone and compared on a year-on-year basis
Key Factors At Play For Nestle India:
- Weakness likely in exports
- Company does not report volume growth
- Muted cues seen from key brands like Maggi and Nescafe
- High input costs may impact gross margins
- Input costs higher mainly due to dairy segment
- Lower corporate tax may aid profit
Earnings Reaction: Sterlite Technologies
The telecom products provider reported a net profit of Rs 80 crore for the quarter ending March, down 51 percent from the same period last year.
The company reported revenue of Rs 1,160 crore during the quarter, a 31 percent decline from Q4FY19.
Diversified global deal wins has led to the company reporting an order book of over Rs 10,000 crore, as per its press release.
As we start FY21, we have a more robust business. We are seeing an accelerated shift towards digitalisation and data network investments from all our customer segments. We are uniquely positioned to address a much larger opportunity and help our customers achieve their network objectives.Anand Agarwal, Group CEO, Sterlite Technologies
Shares fell as much as 4 percent to Rs 96.40 post the announcement.
Stock Update: Shriram Transport Finance
- Worst performer on the Nifty Midcap Index
- Falls as much as 12.5 percent to Rs 643.80
- Down for the fourth straight day
- Longest losing streak in almost two months
- Down 16 percent in the last 4 sessions
- Has declined in 6 out of the last 7 trading sessions
- Today's volumes are 1.6 times higher than its 30-day average
- Resumed decline after testing 50-Day Moving Average of Rs 783.53
- 31 out of the 39 analyst tracking the stock have a buy recommendation
- Return potential of the stock as per Bloomberg data is 48.4 percent
European Markets Open Weak
Benchmarks across Europe have begun trade on a weak note, in-line with most of its peers across the Asia Pacific. Futures on the Dow Jones are off the lowest point of the day but remain 150 points down.
The Stoxx 600 index has opened 0.3 percent lower with most sectors except Utilities and Healthcare trading with losses. Miners and Insurance stocks were among the top laggards.
Brent Crude for the July contract trades 0.6 percent higher at $29.82 per barrel while Gold is little changed.
Here's a look at how benchmarks across Europe have opened:
- Euro Stoxx 50 down 0.4 percent to 2,872
- DAX down 0.5 percent to 10,772
- CAC down 0.4 percent to 4,471
- FTSE 100 down 0.4 percent to 5,915
- IBEX 35 down 0.1 percent to 6,666
Nifty I.T. Index Is The Only Sectoral Gainer
Stock Update: Alkem Laboratories
The pharma company has informed the exchanges that its manufacturing facility at St. Louis has received an Establishment Inspection Report (EIR) from the U.S. FDA.
The inspection of the said facility now stands closed, as per the company's exchange filing.
Shares currently trade 1 percent lower at Rs 2,574 on the National Stock Exchange.
Stock Update: Indian Hotels
- Trades at the lowest level since March 2014
- Down for the fifth straight day
- Longest losing streak in over a month
- Down 11 percent in the last five sessions
- Declines in 6 out of the last 7 trading sessions
- Today's volumes were 76 percent below its 20-day average
- Down 60 percent from its 52-week high of Rs 164.3 on June 26, 2019
- 10 out of the 12 analysts tracking the stock have a buy recommendation; 0 sell calls
- Return potential of the stock as per Bloomberg data is 70.3 percent
Markets At Noon
- Benchmark indices remain near the day's low
- Nifty down 2 percent to 9,051; Day's low: 9,043
- Sensex down 2.2 percent to 30,870; Day's low: 30,866
- Nifty Bank down 3.2 percent to 18,331; Day's low: 18,287
- Nifty Midcap Index down 1.7 percent
- Nifty Smallcap Index down 1.6 percent
- India Volatility Index up 0.6 percent to 38.26
- Nifty I.T. remains the only sectoral gainer; up 0.6 percent
- Nifty Media, Nifty Pharma and Nifty Realty fall between 1-1.5 percent
- Nifty Auto & Nifty PSU Banking index fall between 2-2.5 percent
- Vedanta is the top Nifty gainer; up 6 percent
- Reliance Industries is the top Nifty laggard; down 5 percent
- 1,290 stocks on the NSE are declining while 393 are advancing
Stock Update: Aegis Logistics
- Worst performer on the Nifty Smallcap Index
- Falls as much as 8.44 percent to Rs 165.35
- Biggest one-day fall in almost two months
- Snaps four-day gaining streak
- Had gained 11 percent in the last four sessions
- Today's volumes are 4.7 times higher than its 30-day average
- Breaks below its 50-Day Moving Average of Rs 168.89
- Trades 37 percent below its 52-week high of Rs 267 on February 19, 2020
- 4 out of the 5 analysts tracking the stock have a buy recommendation; 1 sell call
- Return potential of the stock as per Bloomberg data is 34 percent
Covid-19 & Impact On Mumbai
Stock Update: Bodal Chemicals
The company has informed the exchanges that it ha resumed partial operations at its Unit-VII from May 11, after obtaining permission from local authorities.
Operations were shut on March 27 after the nation-wide lockdown was announced to curb the spread of Covid-19.
Shares fell as much a 5.32 percent to Rs 46.25. It is trading at its lowest in a month. After its nine-day gaining streak ended on April 20, 2020, the stock has gained only on four instances in the last 15 trading sessions.
India Mulls Tax Holiday For New Investments
India's commerce ministry is proposing a tax holiday for companies bringing in new investments, Bloomberg News reports citing people familiar with the matter.
The government is exploring measures to support the economy amidst the Covid-19 pandemic.
The Finance Ministry is evaluating the proposal to give a 10-year full tax exemption to companies making new investment upwards of $500 million. The plan will require companies to start operations within three years from June 1.
Sectors like medical devices, telecom equipment, electronics and capital goods are likely to be covered under this proposal.
The government is also mulling to provide a four-year tax holiday to companies that invest $100 million or more in labour intensive sectors like textiles, food processing, leather and footwear.
Stock Update: Mphasis
- Top performer on the Nifty Midcap Index
- Gains for the second straight day
- Up 9 percent in the last two trading sessions
- Best two-day returns in nearly two months
- Today's volumes are double than its 30-day average
- Trades near its 100-Day Moving Average of Rs 815.5
- Has gained 27 percent from its 52-week low of Rs 630 on March 23, 2020
- 24 out of the 34 analysts tracking the stock have a buy recommendation; 1 sell call
- Return potential of the stock as per Bloomberg data is 10.2 percent
How Are The Sectoral Indices Faring
Active Stock Options
- Reliance Industries' 1,600 Call: Premium falls 31.1 percent to Rs 32.7. The contract has added 42,000 shares in Open Interest.
- ICICI Bank's 300 Put: Premium rises 17 percent to Rs 13.05. The contract has added 1.91 lakh shares in Open Interest.
- Piramal Enterprises' 800 Put: Premium rises 113.5 percent to Rs 50.4. The contract has added 27,810 shares in Open Interest.
Nifty Bank Index Is The Top Sectoral Laggard
Earnings Reaction: Godrej Agrovet
The animal feed and agribusiness company saw its net profit falling 34.4 percent in the fourth quarter to Rs 74.6 crore. A key reason for the fall in profitability was an exceptional gain of Rs 88.3 crore in the same quarter last year.
Low input costs led to the company's Ebitda margin expanding to 7.8 percent from 5.4 percent last year.
The stock gave up gains of as much as 3 percent to decline as much as 4.2 percent to Rs 378.50. Shares are down for the third straight day are have been declining for 7 out of the last 9 trading sessions.
F&O Snapshot: Active Options Contracts
- Nifty May futures add 11.2 percent in Open Interest and 8.32 lakh shares
- Nifty Bank May futures add 17.1 percent in Open Interest and 2.4 lakh shares
Nifty: May 14 Expiry
- 9,000 Put: Premium rises 65.5 percent to Rs 77.8. The contract has added 5.34 lakh shares in Open Interest.
- 9,100 Put: Premium rises 60.3 percent to Rs 120.35. The contract has added 4.51 lakh shares in Open Interest.
- 9,200 Call: Premium falls 54.3 percent to Rs 60.95. The contract has added 10.44 lakh shares in Open Interest.
Nifty Bank: May 14 Expiry
- 18,000 Put: Premium up 98 percent to Rs 200.75. The contract has added 1.42 lakh shares in Open Interest.
- 19,000 Call: Premium falls 61.1 percent to Rs 147. The contract has added 3.54 lakh shares in Open Interest.
- 17,500 Put: Premium rises 97.1 percent to Rs 79.05. The contract has added 1.43 lakh shares in Open Interest.
Earnings Reaction: Motilal Oswal Financial Services
The company reported a net loss of Rs 254 crore in the fourth quarter. This compared to a profit of Rs 147 crore during the same quarter last year.
The net loss was due to Mark to market losses of Rs 356 crore due to fair valuation of investments.
While Ebitda fell 4 percent compared to last year, margins narrowed to 44.4 percent from 47.1 percent year-on-year.
Other than the broking business, all other segments of the company reported a de-growth in revenue compared to the previous year.
Shares fell as much as 7.1 percent to Rs 475.70.
Markets At 10:10 A.M.
- Benchmark indices extend losses; fall to the day's low
- Nifty down 1.9 percent to 9,061
- Sensex down 2.1 percent to 30,911
- Nifty Bank down 3.2 percent to 18,343
- Nifty Midcap Index down 2 percent
- Nifty Smallcap Index down 2.1 percent
- India Volatility Index up 1.8 percent to 38.73
- Nifty Auto Index declines 3 percent
- Nifty Media, Nifty Metal, Nifty PSU Bank & Nifty Realty fall over 2 percent each
- UPL is the top gainer on the Nifty; up 2.6 percent
- Only 7 out of the 50 Nifty constituents are advancing
- Zee Entertainment is the top Nifty laggard; down 4.6 percent
- 1,273 stocks on the NSE are trading with losses while 338 are gaining
Money Market Update
The currency opened weaker in today's trading session, extending its losses for the second straight day.
The rupee opened at 75.89 against the U.S. Dollar as compared to Monday's close of 75.73 against the U.S. Dollar.
Yield on the 10-year bonds opened at 6.19 percent as compared to Monday's close of 6.17 percent.
Focus today will be on Macro data that will be reported today. A Bloomberg poll of economists expect the Industrial Production for March to contract 8.85 percent while the CPI inflation for April is likely to accelerate 5.85 percent.
Large Trade Alerts
- Power Grid: 24.5 lakh shares change hands in a large trade
- Rail Vikas Nigam: 28.6 lakh shares change hands in two large trades
- UPL: 10 lakh shares changed hands in a large trade
Buyers and sellers in all these trades were not immediately known, as per Bloomberg data.
- Power Grid trades little changed at Rs 158.55.
- Rail Vikas Nigam trades 4.1 percent higher at Rs 17.85.
- UPL recovered from day's low and trades 3.1 percent higher at Rs 379.40.
Stock Update: Biocon
The company informed the exchanges that its subsidiary Biocon Biologics received the certificate of CMP compliance from German regulators for its biologics drug substance facility in Bengaluru.
The said facility is used in the manufacture of drug substances of Pegfilgrastim and Recombinant Human Insulin along with manufacturing related activities for Insulin Glargine and Insulin Aspart.
The regulators had inspected the facility between January 20-23, 2020.
Shares gave up gains of as much as 1.5 percent and now trade 0.5 percent lower at Rs 349.75.
Stock Reaction: Asian Paints
The paint company is the top laggard on the Nifty 50 index in today's trade after Goldman Sachs downgraded the stock to sell from neutral citing slower volume growth over the coming few years.
The brokerage firm has also cut the company's price target to Rs 1,111 from the earlier target of Rs 1,387.
In its note, Goldman Sachs says that the company's valuations look demanding with the lowest revenue growth expectations. It also expects the price/mix growth to be challenged going ahead due to price cuts and downtrading by customers.
Shares fell as much as 3.67 percent to Rs 1,511.95 and are down for the 10th straight day. This is the longest ever losing streak for the stock.
Earnings Reaction: Piramal Enterprises
Shares of the company fell as much as 7.35 percent to Rs 863.10 after its fourth quarter results.
The company reported a net loss of Rs 1,701.93 crore this quarter, led by a MAT credit write-off of Rs 1,758 crore. It had reported a net profit of Rs 455.3 crore during the same period last year.
The company also said that the expected credit loss on financial assets stood at Rs 2,019 crore as compared to Rs 107.1 crore last year.
It has declared a dividend of Rs 14 per share and also created an additional provision of Rs 1,903 crore to mitigate potential contingencies in the financial services business.
The stock is down for three out of the last 4 trading sessions.
Dragging The Nifty Lower
Opening Bell: Down For The Second Day
Indian equity markets opened lower for the second straight day, tracking weak cues from Asia and Wall Street. Most benchmarks in Asia are trading with losses while futures on the Dow Jones are trading lower by 220 points.
The S&P BSE Sensex opened 0.7 percent lower at 31,342 while the NSE Nifty 50 opened 0.76 percent lower at 9,168.
Both benchmark indices fell 800 and 200 points respectively from their day's high to end little changed on Monday.
Most sectoral indices have opened lower with the Nifty Bank opening with losses of 1 percent. Other sectoral laggards include the Nifty PSU Bank index and the Nifty Realty index which have opened 0.7 percent lower.
861 stocks on the NSE opened with gains today while 963 stocks opened with losses.
Latest On The Coronavirus
- Global cases at 4.17 million
- Death toll rises to 2.85 lakh
- Wuhan reports first new infection after the lockdown ended last month
- Philippines to extend some lockdowns scheduled to expire on May 15
- Russia reports record number of new cases in a day
- White House orders staff to wear masks
- India adds 3,604 cases in the last 24 hours along with 1,538 recoveries and 87 deaths. Total number of cases in India now at 70,756
Trading Ideas From Amit Harchekar Of Index Genius Investment Advisors
- Buy Ultratech futures above Rs 3,360 for target of Rs 3,650 and stop loss of Rs 3,200
- Buy JSW Steel futures above Rs 173.5 for target of Rs 185 and stop loss of Rs 168
Trading Ideas From Independent Technical Analyst Rajat Bose
- Sell Nifty for target of 9,159 and 9,105 with stop loss above 9,305
- Sell Nifty Bank below 18,900 for target of 18,700 and 18,425 with stop loss above 19,153
- Sell Cadila Healthcare for target of Rs 320 and stop loss above Rs 333
- Buy Havells India for target of Rs 497 and Rs 504 with stop loss below Rs 479.80
Key Stocks In Focus
- InterGlobe Aviation: Clarifies that it has not formulated any proposal or shown interest in Virgin Australia.
- Piramal Enterprises: Reports net loss of Rs 1,709 crore in Q4 due to MAT credit write-off of Rs 1,758 crore. Expected credit loss on financial assets stood at Rs 2,109 crore from Rs 107.1 crore.
- Motilal Oswal Financial Services: Reports net loss of Rs 254 crore in the fourth quarter. Mark-to-market losses of Rs 356 crore due to fair valuation of investments. All other businesses other than the broking business saw a revenue de-growth year-on-year.
- Godrej Agrovet: Net profit falls 34.4 percent to Rs 74.6 crore. Exceptional gain of Rs 88.3 crore in the base quarter. Lower raw material costs aid margin expansion to 7.8 percent from 5.4 percent.
- Asian Paints: Goldman Sachs downgrades to sell from neutral and cuts price target to Rs 1,111 from Rs 1,387.
- Ashok Leyland: To consider raising Rs 500 crore via NCDs on May 14.
- SBI Cards & Payments Services: Promoter SBI Life Insurance sold 1.12 lakh shares between May 7-8.
- Companies That Resumed Operations: Federal Mogul, Elgi Equipments, Tata Chemicals, Vascon Engineers, Century Plyboards, Electrotherm, Kirloskar Industries, Acrysil.
- Non-Nifty Earnings Today: Bandhan Bank, Blue Star, Havells, Indiamart Intermesh, Prism Johnson, Sterlite Tech, Syngene, JK Paper, SeQuent Scientific.
For all that you need to know going into trade today, click here.
Your Trade Setup For The Day
How Did The Fund Flows Fare On Monday
A Check On Indian ADRs
U.S. Markets On Monday
- Benchmark indices end mixed amid assessment of relaxing restrictions across the globe amid Covid-19
- The S&P 500 ended little changed while the Dow Jones underperformed
- Nasdaq rose for the sixth straight day, its longest winning streak this year
- More than 33 million Americans have lost jobs in the last seven weeks
- The Bloomberg Dollar spot index gained 0.5 percent
- Yield on the 10-year treasury rose to 0.71 percent
- West Texas Intermediate crude ended flat at $24.7 per barrel
Second Day Of Losses?
Good Morning!
The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.7 percent to 9,165 as of 7:15 a.m.
Asian markets have drifted lower on Tuesday morning as traders continue to assess economic challenges post the gradual reopening of economies.
Markets in Hong Kong, Australia and South Korea trade with losses, while those in Japan are fluctuating.
Treasury yields dipped, while oil prices stabilised after Saudi Arabia announced a surprise output cut.
Short on time? Well, then listen to this podcast for a quick summary of All You Need To Know before the opening bell.
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