A pedestrian walks past a bear and a bull statue outside the Frankfurt Stock Exchange in Frankfurt, Germany (Photographer: Krisztian Bocsi/Bloomberg)

Sensex, Nifty Advance For Second Day As FMCG, Drugmakers Climb; Lenders Retreat

Closing Bell

Indian shares extended their gains for a second day, although not by much, as investors turned fence-sitters ahead of next week’s central bank meetings in the U.S. and Japan.

The S&P BSE Sensex climbed 0.1 percent to 28,412; while the NSE Nifty gained 0.1 percent as well to 8,742. The market breadth was skewed in favour of the bulls at 855 advances, 730 declines and 280 stocks remaining unchanged.

Shares of FMCG companies saw decent buying interest, followed by some of the healthcare names. However, investors booked profit in PSU bank stocks after yesterday’s run up.

The Nifty Media index was the best performing sectoral gauge on the NSE. The index is up around 3.4 percent in the last two trading session.

Leading the list of winners: TV18 Broadcast (+9.1%), Sun TV Networks (+5.5%), Dish TV (+4.7), Network18 Media (+4%), TV Today Network (+2.7) and Zee Entertainment (+2.4%).

L&T Technology IPO Oversubscribed 1.43 Times

The technology solutions provider’s offer for sale gets demand of 143 per cent on the last day of the three-day bidding.

As per NSE data, the firm got bids for around 10.4 million shares, compared to 7.28 million shares on offer.

L&T Tech had raised Rs 268 crore selling 3.12 million shares to anchor investors at Rs 860 each.

Also Read: L&T Technology Services Will Double Its Revenue In 5 Years: AM Naik

GNA Axles IPO Oversubscribed 1.36 Times

Auto components maker GNA Axles’ Rs 130-crore IPO was oversubscribed 1.36 times till afternoon trade on the second day of the bidding today. The IPO received bids for 60,60,390 shares against the total issue size of 44,70,000 shares, as per NSE’s data till 1300 hrs.

The issue was subscribed 64 per cent yesterday. The company has fixed a price band of Rs 205–207 per share for the offer, which would close tomorrow.

SC Directs Parsvnath Developers To Deposit Rs 12 Crore In 4 Weeks

Shares of the real estate firm dropped as much as 2.3 percent after the apex court directed it to deposit Rs 12 crore with its registry within four weeks for a delay in delivering flats to 70 buyers in Greater Noida. (Full report HERE)

European Shares Decline

Rupee Pares Decline as India Official Denies Devaluation Report

The Rupee pared losses from a two-week low after Finance Ministry official denied a report saying the government may discuss a plan to devalue the currency. (Full report HERE)

Tyre Stocks Continue Their Good Run

Shares of tyre makers extended their gains on falling rubber and crude oil prices.

Top gainers

  • J.K. Tyres (+3% to Rs 148)
  • Ceat (+3.7% to Rs 1,081)
  • TVS Srichakra (+2.3% to Rs 2,791)
  • Apollo Tyres (+2% to Rs 216)

Also Read: U.S. Consumers Sue Welspun On Cheap Sheets as Fallout Widens

Ashok Leyland Drops, Hinduja Foundries Hits Lower Circuit on Merger Plans

Shares of the truckmaker fell as much as 3.6 percent, while auto part maker Hinduja Foundries dropped 20 percent after its board okayed a merger proposal.

Ashok Leyland’s goods carrier trucks are parked near a toll collection point in Mumbai. (Photographer: Abhijit Bhatlekar/Bloomberg)
Ashok Leyland’s goods carrier trucks are parked near a toll collection point in Mumbai. (Photographer: Abhijit Bhatlekar/Bloomberg)

The drop in share price of Hinduja Foundries can be attributed to the heavy discount at which the deal has been proposed. The board approved the exchange ratio on the amalgamation in which hundred equity shares of Rs 10 each of Hinduja Foundries will get 40 shares at Re 1 each fully paid of Ashok Leyland.

Every 100 shares of Hinduja Foundries valued at Rs 5,445 are offered for 40 shares of Ashok Leyland valued at Rs 3,376. Considering yesterday’s closing price, the merge deal was at a discount of over 60 percent.

The proposed date of amalgamation is October 1, 2016.

Also Read: Ashok Leyland Falls Behind As Peers Race Ahead

Opening Bell

Indian shares climbed higher, but continued their range-bound trade, as investors tread carefully ahead of next week’s central bank meetings in the U.S. and Japan.

The S&P BSE Sensex gained 0.2 percent to 28,432; while the NSE Nifty advanced 0.2 percent as well to 8,749. The market breath was encouraging at 989 advances, 441 declines and 418 stocks remaining unchanged.

Market Movers: Reliance Communications, ITC, Monsanto India and More

Stocks to Watch

  • ONGC: ONGC Videsh to acquire 11 percent additional interest in the Vankor fields in Eastern Siberia.
  • Shriram Transport: Raised Rs 70 crore selling NCDs
  • Power Grid Corp. : To consider bond issue September 19
  • Indian Oil: To expand existing refinery capacity 5-6Y
  • Tata Power: Unit completes acquisition of Welspun Renewables
  • Monsanto India: Signs definitive merer agreement with Bayer for $66 billion.
  • GPT Infraprojects: Bags order worth Rs 99 crore from Northern Railway.
  • Hotel Leelaventures: Sovereign Funds, PE Funds in race to buy 2 properties (Economic Times)
  • Edelweiss: In talks to sell Agri-commodity business (Economic Times)

For a complete list of stocks to watch, click HERE

IPO Watch

  • GNA Axles IPO gets 64 percent demand on first day of sale yesterday, offer to close on September 16.
  • L&T Technology IPO gets 71 percent demand on day two sale yesterday, offer scheduled to close today
  • PNB: PNB Housing may launch IPO in October. (Mint)

Earnings Reaction to Watch

  • MMTC: Q1 loss Rs 7.01 crore versus Rs 30.55 crore loss YoY
  • NBCC India: Q1 profit Rs 45.41 crore versus Rs 39.65 crore YoY
  • Patel Engineering: Q1 loss Rs 20.48 crore versus Rs 5.15 crore profit YoY
  • Reliance Communications: Q1 net income rises 5.9 percent YoY to Rs 54 crore

Events/Data to Watch

  • SEA to release Aug. edible-oil imports data
  • 09/15-09/30: Q2 BoP current account balance, estimate $2.65 billion (Prior -$0.30 billion)
  • 09/15-09/16: India August exports; no estimate (prior -6.8 percent)

o Imports; no estimate (prior -19.0 percent)
o Trade Balance; estimate -$7 billion (prior -$7.761 billion)

  • 9:30am: Finance Minister at JP Morgan’s conference in Delhi

Talking Points

  • Billionaire Anil Ambani’s Reliance Communication merges with Aircel
  • Sebi looks into discrepancies in Yes Bank’s botched-up QIP (Economic Times)
  • RBI panel to review rules for hedging of commodity price risk
  • Supreme Court asks government to stop sterilization camps

  • India to induct major warship destroyer on September 17
  • India agrees to supply 170,000 tonne wheat to Afghanistan
  • Afghanistan seeks India assistance to set up ports as SEZs
  • India monsoon rainfall 5 percent below normal as on September 14
  • Aluminum prices seem to have bottomed out: Hindalco’s KM Birla
  • India said to refer 2009 Tata-Docomo deal to forex probe agency
  • Global funds sell Rs 477 crore of local stocks; domestic funds sell Rs 8.53 crore yesterday: Provisional data

Good Morning!

The Nifty futures on the Singapore Exchange, an early indicator of the Nifty performance in India, declined 0.3 percent to 8,738.

U.S. stocks erased gains Thursday as a slump in oil sank energy shares, overshadowing a rally in Apple Inc. amid concern the rout that’s wiped out $2 trillion in global equity value the past week isn’t over.

While odds on a U.S. interest-rate hike next week are down two percentage points from a week ago to 20 percent, economists are divided over what Bank of Japan will do at the end of its policy meeting on September 21.

Meanwhile, stronger-than-expected U.K. jobs data out quashed fears of a post-Brexit meltdown in the country’s labour market, and cemented expectations the Bank of England will maintain status quo at its policy meeting on Thursday.

Crude traded below $44 a barrel amid concern recent declines in U.S. oil inventories will prove temporary.

Markets in mainland China, South Korea and Taiwan are shut Thursday for holidays.

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