Nifty Struggles To Hold 9,600 After Late Selloff In Tech Stocks

Indian shares declined for a second day after a selloff in technology companies in the last hour of trade soured sentiment.

The S&P Sensex was little changed at 31,103.49 while the NSE Nifty dipped 0.1 percent to 9,606.90. While the benchmarks wiped out their intraday gains, investors are likely to take solace from the 50-share index’s closing above the 9,600-mark after testing the level several times in the last minutes of trade.

The market breadth, an indication of the sentiment, was spilt right in the middle at 1:1. The Nifty IT Index was the worst performing sectoral gauge, while the Nifty Realty Index continued to lent support.

Power Grid Corp. topped the Sensex and the Nifty after Power Minister Piyush Goyal said the government has “close to a resolution mechanism for stressed power plants”.

Saregama India Jumps On Heavy Volumes

• Stock gains as much as 15.6%, its biggest move since May 3
• Volumes at 27 times its 20-day average
• The music production house has a market cap of Rs 450 crore.
• It has returned 21 percent so far this year, compared to a loss of 12 percent last year.

Mumbai-based construction company had filed draft papers with Sebi in April and in June obtained its 'observations', necessary for launching an IPO, Capacit'e said in a statement.

Funds raised through the issue will be utilised for working capital requirements, purchase of capital assets and for general corporate purposes. The company had an order book of over Rs 4,000 crore as on January 31, 2017 comprising 51 ongoing projects.

PTI

Dhunseri Investments Gains For A Second Day

• The stock jumps 20% intraday on the NSE, most since April 28
• Trading volumes close to 12 times its 20-day average
• The investment management company, which has a market capitalisation of Rs 218 crore, has returned over 107% so far this year.

Shares of the media company rose as much as 14.4 percent, the most since April 05, to Rs 155. Trading volume was 16.6 times its 20-day average for this time of the day.

The stock returned 80 percent so far this year and a gain of 39 percent in the past 52-weeks. The Relative Strength Index (RSI) is 76, indicating that the stock may be overbought.

Shares of the sugar producers advanced anywhere between 7 percent and 0.7 percent, making of them first time in over a week.

• Shree Renuka Sugar (+4.4%)
• Bajaj Hindusthan (+2.3%)
• Sakthi Sugar (+6.5%)
• Uttam Sugar (+2%)
• Ugar Sugar Works (+5.7%)
• KM Sugar Mills (+5%)

Infosys Ltd. warned that the expected increase in wage costs in the U.S. and other developed markets could impact its profitability as it ramps up local hiring.

The key risks Infosys flagged off include:

• Taxes on companies that offshore work outside U.S.
• Restrictions on the number of H-1B visas.
• An increase in the minimum wages of visa-dependent employees as was implemented in the U.K.
• An increase in visa fees.

The stock dropped as much as 1.27 percent to Rs 951 on the National Stock Exchange.

Shares of the auto part maker rose as much as 17.1 percent, the most since January 25 of this year, on heavy volumes. Today’s rise marks the end of the scrip’s six-day losing streak.

Trading volume was 21 times its 20-day average.

The rupee extended its losses against the U.S. dollar to day three while bonds yields fell after official data late Monday showed consumer price inflation slipped to a new record low in May.

Strength in the dollar against other currencies overseas made the rupee keep a low profile. Traders attributed the rupee's fall to increased demand for the U.S. currency from importers and banks and a lower opening in the domestic equity market.

Yesterday, the rupee was down 20 paise to end at a one- week low of 64.44 amid concerns about a probable Fed rate increase.

(With inputs from PTI)

Shares of the country’s largest pharma firm rose 2.9 percent after it received final regulatory approval for its anti-cholesterol drug. As per IMS, Ezetimibe tablets had annual sales of approximately $2.7 billion in the U.S. for the 12 months ended April 2017.

Indian shares climbed after better-than-anticipated factory output data and record low inflation raised hopes of a central bank interest rate cut.

The S&P BSE Sensex swung between gains and losses before it rose as much as 0.2 percent to 31,159. The NSE Nifty 50 Index too gained 0.2 percent to 9,634. The market breadth was tilted firmly in favour of the bulls. About 5 stocks advanced to every 1 that declined on the NSE.

The Nifty Pharma (up 1.1 percent) was the best performing sectoral gauge on the NSE while Nifty IT index dropped the most.

• Axis Bank: Seeks to raise up to Rs 5,000 crore via debentures
• Bayer Cropscience, Monsanto India: Global biotech companies are reducing research activities and investments in India, Business Standard reports
• Capital First: To consider private placement of securities
• Castrol India: U.K. unit to acquire additional 0.11 percent company stake from BP Mauritius on June 19
• Lupin: Revenue may benefit as Indian consumer non-durables production volume rose in April
• Reliance Capital: Reliance General Insurance approves listing; to sell 10% stake
• Reliance Communications: Said to approach Citic Telecom about GCX sale (Bloomberg)
• Sun Pharma: Gets U.S. FDA nod for Zetia generic. IMS says market size of $2.7 billion.
• SpiceJet: To launch flights on Mumbai to Porbandar, andla routes
• State Bank of India : Allots 52.22 crore shares to 61 investors via QIP
• Wipro: Trades ex-bonus; NYSE has not yet declared ex-dividend date for ADR programme

For a complete list of stocks to watch, click here

The pressure is clearly mounting on the central bank to act. If the government push wasn’t enough, the record low CPI inflation has put it in a tight spot.

Five days after the RBI Monetary Policy Committee kept rates unchanged, inflation in May slipped to record lows of 2.18 percent. For an economy faced by slower growth and low creditoff take, a rate cut is now all the more significant.

So be prepared for a rally in the market yield on the benchmark bond could drop as much as 7 basis points from 6.52 percent at last close.

In the currency market, Asian equities are trading higher, which will lend support to local currencies. The rupee, which fell 0.3 percent in the last session, could recover losses helped by strong stocks. The pound held losses, while an index of dollar strength is little changed.

The rupee may trade in a range of 64.30-64.50 a dollar in the day.

• India’s consumer prices fall to record low of 2.18 percent
• India April industrial production rises 3.1 percent YoY; Estimate +2.7 percent

• RBI says switched Rs 17,000 crore of government securities to longer tenor
• India appoints administrator for Sahara Life Insurance
• India sets July deadline for industries to get groundwater permits
• India’s CBDT clarifies on income tax rules related to trade advances and dividends
• India PM Modi to meet U.S. President Trump in Washington late June
• India monsoon advances into peanut, rice, tea growing areas

Good Morning!

Asian shares were mixed in early trade, as the selloff in technology showed signs of easing. The British pound was steady as U.K. Prime Minister Theresa May fought to survive the fallout from the British general election.

Crude oil traded above $46 a barrel following its first two-day gain in three weeks.

The Nasdaq 100 Index capped its biggest two-day decline since September on Monday, though losses for the S&P 500 index were more muted.

The sudden slide in tech stocks, whose gains had helped send global equities to repeated record levels this year, blindsided many investors after markets largely brushed aside last week’s trio of high-risk events.

Investors may get more drama from Washington as Attorney General Jeff Sessions will testify publicly Tuesday before the Senate Intelligence Committee on his role in the firing of FBI Director James Comey and his contacts that he and his associates of President Trump had with the Russians officials.

Meanwhile, the U.S. Federal Reserve is set to hike interest rates this week, the second time this year, leading a pack of central banks that are moving in the direction of removing ultra-accommodative policy.