Sensex, Nifty Unmoved For Fifth Session; Tata Motors Drops After Earnings Miss

Indian shares closed little changed for a fifth straight session, as gains in select lenders, software service providers and oil companies countered losses in automakers and healthcare firms.

The S&P BSE Sensex was unmoved at 28,339 while the NSE Nifty 50 slid 0.1 percent to 8,792. The market breadth highlighted the underlying weakness in today’s trade. About 1078 stocks declined, 552 advanced and 80 remained unchanged on the NSE.

Gaurang Shah, Asst. Vice President, Geojit BNP Paribas Financial Services Ltd said he expects Nifty to continue to trade in a range of 8725-8830, especially with the expiry next week. “That will keep the market choppy and volatile,” he told BloombergQuint in a phone conversation. Shah said he expects next month to be more interesting since it will have more trading days.

Shah said the Nifty may touch 8,950-9,000 next month or so on incremental positive sentiment prevailing the market. “I expect the index to move higher since the downside is extremely protected,” he said.

“The reason being the FII selling in the last four months. They were worried about demonetisation, earnings and the budget. On all these three matters, their concerns were beaten hands down. My sense is that FII flows will come in at lower levels whenever the market corrects,” he said.

Moreover, Shah said he is hoping for is a 25 basis point interest rate cut by the Reserve Bank of India on the back improving factory output data and inflation at record low level.

Shares of the homegrown auto maker dropped as much as 7.7 percent after it reported earnings that missed street estimates.

The owner of Jaguar and Land Rover made a profit of Rs 112 crore for the quarter-ended December, compared to Rs 2,952.6 crore in the same period last year. A Bloomberg poll of analysts had anticipated the figure to come in at Rs 2,260 crore.

The company said the third quarter earnings were impacted by Rs 717 crore charge related to Tianjin port explosion in August 2015.

It clocked sales of Rs 68,541 crore versus an estimate of Rs 67,880 crore.

Vedanta Ltd., the flagship unit of Anil Agarwal’s Vedanta Resources Plc, reported 4.5 times jump in its net profit, and yet fell short of analysts’ estimates.

Net profit for the October to December quarter soared to Rs 1,866 crore, the highest in 12 quarters, according to the company’s filing to the stock exchanges. The consensus estimate of 13 analysts tracked by Bloomberg stood at Rs 1,990 crore.

For more details on the metal makers results, click HERE

Shares of the healthcare firm gained as much as 2.7 percent after reporting third quarter earnings that beat street estimates.

• Q3 net Rs 72.83 crore versus estimate of Rs 64.40 crore
• Revenue Rs 1,680 crore versus estimate of Rs 1,590 crore
• Total costs Rs 1,490 crore versus Rs 1,240 crore
• Approves raising up to Rs 200 crore via bonds

Tata Metaliks: Up In 8 Out Of Last 10 Sessions

• Tata Metaliks is up around 3 percent today, making it the third straight day of gains.
• The volumes are at two times its 20-day average on BSE.
• The stock has risen in eight out of the last 10 sessions, and has gained 20 percent in this period.
• The pig iron manufacturer's market cap stands at Rs 1,140 crore.

Shares of the company extend decline to 2.5 percent after it reporting its third quarter earnings.

• Q3 net profit of Rs 1,750 crore; estimate Rs 1,600 crore.
• Q3 other income Rs 311 crore versus Rs 19.5 crore
• Revenue Rs 5,650 crore versus Rs 6,020 crore
• Total costs Rs 3,480 crore versus Rs 4,160 crore
• To pay interim dividend of Rs 7 a share

Wholesale inflation rose 5.25 percent in January, mainly on account of rise in prices of fuel and power, even as food articles turned cheaper. The figure was much above the 4.35 percent estimated by economists in a Bloomberg poll.

The Wholesale Price Index-based inflation, reflecting the annual rate of price rise, in December stood at 3.39 per cent. The WPI inflation for November has been revised upwards at 3.38 percent against the provisional estimate of 3.15 percent.

The rise in wholesale inflation is in contrast to the fall in retail inflation, which hit an all-time low of 3.17 per cent in January.

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• HPCL cut to sell from outperform at CLSA
• Hindalco raised to buy versus accumulate at Prabhudas Lilladher
• Aurobindo Pharma cut to add versus buy at Spark Capital
• Mahanagar Gas cut to hold versus buy at Jefferies
• Tata Consultancy raised to hold versus sell at Religare
• Wipro raised to hold versus sell at Religare
• Coal India rated new reduce at CIMB
• Tech Mahindra raised to hold versus sell at Religare

• Adani Transmission (down over 1 percent): Q3 profit Rs 99.28 crore versus Rs 74.78 crore
• Ahluwalia Contracts (down 0.2 percent): Q3 net Rs 24.45 crore versus Rs 19.84 crore
• BEML (up 1.9 percent): Q3 profit Rs 21.74 crore versus Rs 9.73 crore
• BGR Energy (up 7.5 percent): Q3 net Rs 10.48 crore versus Rs 8.82 crore loss
• Container Corp. (down 3.24 percent): Q3 net beats estimate; approves free share issue
• Dishman Pharma (down 3.2 percent): Q3 net Rs 50.68 crore versus Rs 44.76 crore
• Entertainment Network (down 0.8 percent): Q3 net Rs 16.41 crore versus Rs 28.86 crore
• GlaxoSmithKline Consumer (up 0.4 percent): Q3 net Rs 136 crore; estimate Rs 121 crore
• Hindustan Petroleum (down 3.8 percent): Q3 profit jumps 53 percent YoY to Rs 1,590 crore; to raise up to Rs 6,000 crore debt in FY18, chairman says
• Jaiprakash Power (down 4.4 percent): Q3 loss Rs 173 crore versus Rs 116 crore loss
• MMTC (up 6.6 percent): Q3 net Rs 74.43 crore versus Rs 19.89 crore
• Muthoot Finance (up 1.9 percent): Q3 net Rs 290 crore versus Rs 187 crore; to raise Homefin unit stake to 88.3 percent
• National Aluminium (up 0.9 percent): Q3 net Rs 144 crore; estimate Rs 182 crore
• NMDC (down 1.5 percent): Q3 profit Rs 595 crore versus Rs 421 crore
• Petronet LNG (down 0.5 percent): Q3 net Rs 397 crore; estimate Rs 383 crore
• Reliance Infra (down 0.9 percent): Q3 net income Rs 375 crore versus Rs 252 crore
• Repco Home (down 6.81 percent): Q3 net income Rs 46.44 crore versus Rs 38.58 crore
• SJVN Ltd. (up 4.2 percent): Q3 profit Rs 260 crore versus Rs 220 crore YoY

Shares of the airport operator jumped as much as 17 percent to highest since February of last year after the company-led consortium bagged the rights to develop the Navi Mumbai Airport.

The stock was the best performer on the Nifty 500 index with volume at 6.2 times its three-month full-day average. It was the most traded stock by volume.

The size of the contract remains undisclosed as of now. However, the total projected cost for the airport was Rs 14,574 crore in financial year 2013, according to information on CIDCO's website.

For more details, click HERE

Indian shares fluctuated between gains and losses, tracking a faltering global rally as automakers dragged while banking stocks lent support.

The S&P BSE Sensex declined 0.1 percent to 28,313 while the NSE Nifty fell 0.2 percent to 8,786. The market breadth, however, was encouraging with more buyers than sellers. About 756 stocks advanced, 680 declined and 445 remained unchanged on the NSE.

• GMR Infra: Writes off Rs 340 crore in energy, roads investments
• GVK Power: Wins bid for Navi Mumbai airport
• HPCL: Q3 profit jumps 53 percent YoY to Rs 1,590 crore; to raise up to Rs 6,000 crore debt in FY18, chairman says
• Infibeam Incorporation: To invest Rs 150 crore in payment aggregator Avenues (India) Pvt. Ltd.
• Muthoot Finance: Raises funds worth up to Rs 200 crore via private placements
• Polypex Corporation: Sells its stake in Peninsula Beverages and Foods Company Pvt. Ltd.
• DLF: GIC leads race to buy 40 percent stake in DLF's rental arm for Rs 12,000 crore. (Economic Times)
• Idea: Could exit tower business for cash comfort. In talks with rival companies to share infrastructure for 2G, 3G and 4G services. (Economic Times)

For a complete list of stocks to watch, click HERE

• Rajiv Bansal’s Severance Pay Issue Could Have Been Handled Better: Infosys Chairman
• India inflation eases more than expected; slowest on record
• Cotton rises to 2-year high amid India woes in active trading
• Tepco, Chubu Electric to buy into India’s ReNew Power (Nikkei)
• Apple shares hit record close on optimism for next IPhone

Also Read: Rallying Rupee Is RBI’s Insurance Policy for Unpredictable Times

Data To Watch

• Noon. Wholesale-price inflation data for January; estimate 4.35 percent (prior 3.39 percent)
• 02/14-02/15: India January exports; no estimate (prior +5.7 percent)
• Imports; no estimate (prior +0.5 percent)
• Trade Balance; estimate -$10.3 billion (prior -$10.4 billion)

India's inflation grew at its slowest pace on record. Consumer prices rose 3.17 percent in January, slower than 3.24 percent estimate in a Bloomberg survey. Is this enough reason to celebrate? We guess not.

First, the core inflation, comprising food and fuel which is the top concern of the central bank, is still sticky. Also, there are enough voices out there that feel there is potential risk of reversal as the effects of demonetization fade. Therefore for now, the bonds may not do the spring dance and yields on the benchmark note may stay high in what could be termed as a stretched period of range bound trade.

In currency market, dollar retreated from its strongest level of the month as markets awaited Fed chair Janet Yellen’s testimony to Congress for hints about the path of interest rates.

With the Fed still on track to raise rates this year, the dollar remains attractive, though there’s still some caution about building longs given the risk that Trump may talk the currency down.

For today, the rupee is expected to open higher and trade with a strong upward bias.

Good Morning!

The Nifty futures on the Singapore Stock Exchange, an early indicator of Nifty’s performance in India, gained 0.2 percent to 8,837.

Asian stocks fluctuated in early trade, taking the momentum out of a global rally after U.S. benchmarks surged to a fresh round of record. Optimism for an improving U.S. economy under Donald Trump has underpinned investors’ appetite for equities.

American consumer inflation expectations hit a 19-month high in January, which should be a welcome news for Federal Reserve as it contends with Trump’s still-unclear economic plans. Investors will tune in to Janet Yellen testimony in Congress later in the day. The dollar could rally if she suggests a March increase is still on the cards, according to Bloomberg strategists.

Traders are pricing in a 30 percent chance the Fed lifts rates at its March 15 meeting, little changed from the probability seen at the start of this year. Bank of Japan Governor Haruhiko Kuroda is due to speak later in the day.

China’s producer prices increased the most since 2011, further lifting the outlook for global reflation with the world’s biggest exporter poised to give more support to gains.

Iron ore continued to gain for sixth straight session on Tuesday. The raw material used to make steel is trading at the highest in more than two years.

Oil climbed back above the $53 per barrel mark even as investors continued to fret over rising U.S. crude stockpiles offsetting the output cuts by the OPEC and other producers.

U.S. inventories probably rose by 3.5 million barrels last week, for a sixth weekly advance, according to a Bloomberg survey before government data due on Wednesday.