Sensex, Nifty Lose Steam After Hitting Fresh 52-Week High

Indian shares declined for a third time this week after some investors deemed the run up in key equity benchmarks overdone.

The S&P BSE Sensex swung in a 360-point range before closing 0.5 percent lower at 28,839. Meanwhile, the NSE Nifty index lost 0.6 percent to 8,899. This after the 50-share index rose as much as 0.5 percent intraday to 8,992 – a fresh 52-week high.

The market breadth turned firmly in favour of the sellers by end of trade. About 1,164 stocks declined, 323 advanced and 58 remained unchanged on the NSE.

“This has been liquidity-driven and not a valuation-based rally,” said Mayuresh Joshi, fund manager, Angel Broking adding, “eventually there will be catch up happening.”

Be that as it may, Joshi said the correction is unlikely to be very sharp as there will be buyers at lower levels. He said for the Nifty to take out 9,000 decisively banks, autos and IT as a pack need to fire on all cylinders. “Investors can stay invested with a long-term perspective and keep investing in a staggered manner,” he told BloombergQuint in a phone conversation.

Shares of the textile maker dropped as much as 4.9 percent, the most since November 15, after a minority shareholder put out an open letter alleging misuse of company funds.

Minority shareholder Vishal Patel has alleged “poor governance” and use of company funds in “unproductive avenues only to appease the promotor’s personal interest”.

Read: ‘Raymond-The Complete Disaster’, Says Minority Shareholder

Shares of the telecom operator jumped as much as 3.9 percent after it received Rs 216 crore for assessment year 2006-07 after adjustments.

The income tax refund includes Rs 57.03 crore towards interest, the company said in a exchange filing.

Havells' Three-Day Winning Streak

• Havells India rose as much as 5.2 percent today, and extended its winning streak to three sessions.
• The volumes currently stand at two times its 20-day average on NSE.
• Of the 10 analysts that have changed their recommendations on the stock in the last month, seven have downgraded the stock.
• Electrical goods manufacturer's capitalisation stands at Rs 26,370 crore.

Reserve Bank of India Governor Urjit Patel said the rupee is ‘broadly’ where it should be. Problem is, a central bank gauge of the currency’s trade-weighted performance shows it is overvalued.

Adding to the confusion is the government’s earlier claim that indexes managed by the RBI and the International Monetary Fund have overstated rupee gains. To prove its point, India’s finance ministry has created its own gauges of the rupee’s trade-weighted performance, and all of this has left investors grappling with the question: what is the fair value for the currency?

To read the complete article, click HERE

Shares of the two-wheeler maker rose 1.6 percent after it reported a marginal year-on-year (YoY) sales growth in February, driven by exports which rose for the first time since September 2015.

Total sales stood at 2,73,513 units compared to 2,72,719 units in February 2016, according to the company's data release on the exchanges.

While exports saw a 16 percent uptick YoY to 1,14,404 units during the month, domestic sales dropped 8 percent to 1,59,109 units.

The rupee edged higher by 6 paise to 66.76 against the dollar in early trade after exporters and banks stepped up selling of the U.S. currency.

Forex dealers said that a higher opening in the domestic equity market and robust GDP numbers for the December quarter also supported the rupee. However, the strength of the dollar overseas on growing expectations of a Federal Reserve rate hike this month, limited the gains.

Fed policymakers have been hinting at a rate hike at its meeting scheduled on March 14-15, irrespective of US President Donald Trump's budget plans. This has made the US markets soar to record highs of late.

Yesterday, the rupee had lost 13 paise to close at 66.82 against the dollar.

Indian shares climbed higher, following a rally in global equity markets, with key benchmark indices inching closer to their record highs.

The S&P BSE Sensex gained 0.5 percent to 29,132 while the NSE Nifty advanced 0.5 percent to 8,989. Both the indices were trading close to their 52-week highs. The market breadth was firmly in favour of the bulls. About 1,026 stocks advanced, 432 declined and 439 remained unchanged on the NSE.

The Nifty Metal and Nifty Auto indexes were the best performing sectoral gauges on the exchange, while the Nifty Realty index dropped the most.

Movers & Shakers: Tata Motors, Wockhardt, DLF And More

Brokerage house Morgan Stanley has raised its target for India’s benchmark Sensex by 10 percent to 33,000 for December 2017 on expectation of “heightened” merger and acquisition (M&A) activity, which in turn it said, may raise valuations and margins.

“If history is a guide, M&A transactions could scale $100 billion (Rs 6 lakh crore) in the next 12-months,” Morgan Stanley strategists led by Ridham Desai wrote in a note on Tuesday.

To read the full report, click HERE

A Bloomberg gauge of dollar strength has risen for a fifth day, its longest gaining streak since May 2016 after another Federal Reserve Governor said that a rate increase will likely be appropriate soon. U.S. President Donald Trump's pro-growth speech also added muscle to the risk-on sentiment and the odds of a rate hike in March have climbed over 70 percent. The rupee, which slipped to 66.8250 a dollar in the last session, may run up more losses today.

Sovereign bonds fell, snapping three sessions of gains, as lower-than-expected slowdown in GDP growth faded the possibility of another rate cut. The higher probability of Fed rate hike too has soured the sentiment and yields could stay higher after rising 6 basis points to 6.93 percent in the last session.

• Coal India: February production 54.3 million tonne, achieving 96 percent of target
• DLF: Panel approves entering definitive pact with GIC affiliate
• Glenmark: Enters into pact with Evestra to market generic version of NuvaRing
• Hero MotoCorp: February sales decline 4.7 percent from year earlier
• Lupin: Introduces generic version of Temovate Scalp Application, 0.05 percent in U.S.
• Mahindra & Mahindra: Looking to set up auto production site outside India
• MOIL: Cuts prices of some grades manganese ore
• Narayan Hrudayalaya: Says due diligence under progress to buy Panacea Hospital, no decision taken
• Shriram City Union: To consider raising Rs 225 crore via NCDs on March 7
• Steel Authority: Says February exports 103,00 tonne, best in 10 years
• Tata Motors: February sales rise 2 percent YoY to 47,573 units
• Wockhardt: Warning issued to U.S. unit Morton Grove (More Details HERE)
• Zydus: Board approves interim dividend

• Indian lenders’ $105 billion maturity wall whets bond appetite
• India’s internet users to surpass 450 million by June 2017: Internet & Mobile Association of India (IAMAI)
• Tata Motors to consider offering of Rs 500 crore of NCDs

Also Read: Indian Lenders' $105 Billion Maturity Wall Whets Bond Appetite

• Jaguar Land Rover seeks ‘fair’ support for carmakers post-Brexit
• India sugar still seen dry; adverse weather for Florida citrus
• National Aluminium Company to consider mid-year dividend

• SEBI’s new chairman Ajay Tyagi takes charge
• Global funds sell Rs 198 crore of local stocks; domestic funds buy Rs 254 crore yesterday: Provisional data
• Tamil Nadu traders stop selling aerated drinks made by Coca-Cola and PepsiCo
• Carlyle, Warburg Pincus, Advent eye ICICI Lombard stake (Mint)
• India said likely to impose 25 percent wheat import tax (Reuters)
• Jio payments bank said to get RBI nod to start operations (Mint)
• Jaitley says GDP numbers will be better next quarters

Good Morning!

The Singapore traded SGX Nifty, an early indicator of Nifty’s performance in India, climbed 0.4 percent to 9,010.

Asian stocks gained momentum in early trade, after U.S. equity indices set new records on signs that growth is firming worldwide. The dollar extended gains after Federal Reserve Governor Lael Brainard supported the case for an interest-rate hike “soon”.

Investors are now looking ahead to a speech by Chair Janet Yellen tomorrow to reaffirm a view that interest rates are likely to go up this month. The odds for a Fed rate hike in two weeks swelled to 80 percent.

Treasuries fell for a fourth straight session and gold slipped 0.3 percent to $1,246 an ounce. This after the precious metal touched its highest level in more than three months last Friday.

Meanwhile, data showed that U.S. manufacturing expanded last month at the fastest pace in three years and an acceleration in German inflation added to signs of momentum in Europe’s largest economy.

Oil retreated after government data showed U.S. crude stockpiles rose to a record, countering efforts by Organisation of Petroleum Exporting Countries and other nations to curb global surplus.