Nifty Erases Entire 2018 Gains As Exit Polls Predict Close Battle For BJP

Indian equity benchmarks posted their worst day since Oct. 11 after exit polls predicted close fight for the Bharatiya Janata Party in Madhya Pradesh and Chhattisgarh while a victory for Congress in Rajasthan before general elections in 2019.

The S&P BSE Sensex fell 2 percent or 713.53 points to 34,959.72 and the NSE Nifty 50 Index dropped 1.9 percent or 205.25 points to 10,488.45. The gravity of fall was such that 28 of 30 stocks in Sensex ended lower.

Six major exit polls showed Modi’s Bharatiya Janata Party and the opposition Congress party neck-and-neck in the central Indian states of Madhya Pradesh and Chhattisgarh, which are considered BJP strongholds.

All 19 sector gauges compiled by BSE ended lower led by the S&P BSE Realty Index's 3.15 percent fall.

Selling pressure was broad-based as the S&P BSE MidCap and S&P BSE SmallCap Indices fell 1.8 percent each.

The S&P BSE Sensex extended losses and fell as much as 2.12 percent or 757 points to 34,915.

• Hindustan Zinc has 33 lakh shares change hands in a block deal. Stock down 0.8 percent at Rs 270.40.

Buyers and sellers were not immediately known

Source: Bloomberg

• Mangalam Drugs: The Mumbai-based drugmaker rose as much as 17.4 percent to Rs 85 after its unit-1 facility received approval from World Health Organisation.
• Ashoka Buildcon: The Mumbai-based construction company snapped its three-day losing streak and rose as much as 6.69 percent to Rs 127.55 after it won a railway project from Rail Vikas Nigam Limited.
• Indian Oil: The state-run oil refiner rose as much as 4.2 percent at Rs 135.15 as its board will consider buyback and dividend on Dec. 13.
• ITI Ltd: The Bangaluru-based communications equipment maker snapped its five-day losing streak and rose as much as 7 percent to Rs 92.90.

Finance Minister speaks on National Pension Plan, says changes in NPS to benefit employees.

Arun Jaitley says:

• Government has approved to raise contribution of central government for National Pension Scheme to 14 percent from 10 percent
• Employees contribution to remain at 10 percent
• Government has made entire 60 percent of withdrawal by employees during retirement tax free
• Dates for changes to come into effect will be notified later

Stocks linked to billionaires Mukesh Ambani, Anil Ambani and Gautam Adani that rallied after Narendra Modi won the nation’s general elections in 2014, dropped Monday after exit polls showed India’s Prime Minister is set for tight electoral contests in key states before general elections next year.

• Ambani companies: Reliance Industries falls as much as 4.5 percent, Reliance Communications drops 5.7 percent
• Adani companies: Adani Power down as much as 8.4 percent, Adani Ports and Special Economic Zone -4.2 percent

Source: Bloomberg

Shares of the Bengaluru-based integrated business services provider fell for fifteenth session in a row to Rs 604.05. In the course of last 15 sessions the stock has plunged 21 percent.

Quess Corp's relative strength index is at 16 indicating the stock may be oversold, according to data compiled by Bloomberg.

Indian equity benchmarks extended decline dragged by heavyweights like Reliance Industries, Kotak Mahindra Bank, HDFC and Infosys.

Gold traded near the highest level in five months amid a retreat in Asian equities and U.S. stock futures on the potential escalation of tensions between Washington and Beijing.

Haven assets are rising after China’s vice foreign minister summoned the U.S. ambassador Terry Branstad in protest over the arrest of Huawei Technologies Co.’s chief financial officer, and on concerns over China’s slowing economy.

Traders are also assessing if the Federal Reserve will pursue a slower pace of U.S. interest rate increases after jobs and wages rose by less than forecast in November.

Source: Bloomberg

Indian equity benchmarks continue to trade on a weak note dragged by weakness in Reliance Industries, Kotak Mahindra Bank and HDFC.

The S&P BSE Sensex fell 1.43 percent or 514 points to 35,160 and the NSE Nifty 50 Index dropped 1.5 percent or 157 points to 10,537.

All 19 sector gauges compiled by BSE were trading lower led by the S&P BSE Energy Index's 2.6 percent.

Selling pressure was broad-based as the S&P BSE MidCap Index fell 1.4 percent and the S&P BSE SmallCap Index slumped 1.5 percent.

Shares of the Mumbai-based automobile maker fell 2.62 percent to Rs 158.15 after its global wholesales declined 7 percent (YoY) to 104,964 units.

• Total passenger vehicles sales 66,429 units; lower 7 percent (YoY)
• Jaguar Land Rover sales were 49,312 units in November, including 4,144 units from JV with Chery Automobiles
• Jaguar sales 15,114 units; Land Rover at 34,198 units

• Kalpataru Power: The Mumbai-based power transmission line tower maker rose as much as 2.2 percent to Rs 348.95. Trading volume was 18 times its 20-day average.
• JB Chemicals: The Mumbai-based drugmaker fell as much as 2.94 percent to Rs 295. Trading volume was 40 times its 20-day average.
• SJVN: The Shimla-based power generation company fell as much as 5 percent to Rs 24.75. Trading volume was 18 times its 20-day average.
• NLC India: The Cuddalore-based mining and power company fell as much as 9.24 percent to Rs 67.80. Trading volume was 15 times its 20-day average.

Shares of the Faridabad-based farm equipment maker declined for the fifth straight session and fell as much as 4 percent to Rs 601.

Escorts transferred the existing RT Crane business to its joint venture with Japan-based Tadano for Rs 35 crore on a slump sale basis, according to its exchange notification.

• April-November gross direct tax collection at Rs 6.75 lakh crore, up 15.7 percent (YoY)
• Refunds amounting to Rs.1.23 lakh crore issued between April-November, up 20.8 percent (YoY)
• Net direct tax collections represent 48 percent of total budgeted estimates of direct taxes for FY2018-19
• April-November corporate income tax collections up 17.7 percent (YoY)
• April-November personal income tax collections up 18.3 percent (YoY)

Source: Central Board of Direct Taxes

• Axis Bank has 18.6 lakh shares change hands in a block deal. Stock down 1.27 percent at Rs 596.25.

Buyers and sellers were not immediately known

Source: Bloomberg

November auto sales:

• Passenger vehicles: 2.66 lakh vehicles, down 3.4% YoY
• Trucks, buses: 72,812 units, up 5.7% YoY
• Two-wheelers: 16.45 lakh units, up 7.1% YoY

Source: Society of Indian Automobile Manufacturers

All 30 Sensex stocks were trading lower. Reliance Industries, HDFC, HDFC Bank, Larsen & Toubro and ICICI Bank collectively contributed over 380 points to fall in the S&P BSE Sensex Index, according to information on BSE's website.

Nifty 10,500 put option contract was among the most active option contracts on the National Stock Exchange.

Premium on the contract rose 75 percent to Rs 170.45. Over 1.05 lakh shares were added to the open interest which stood at over 36.50 lakh shares.

Click here to see the complete options chain

Shares of the Mumbai-based construction company snapped its three-day losing streak and rose as much as 6.69 percent to Rs 127.55 after it won a railway project from Rail Vikas Nigam Limited.

The company bagged a railway project worth Rs 794.20 crore from Rail Vikas Nigam Ltd. for construction of roadbed, bridges in Bihar and Jharkhand, Ashoka Buildcon said in an exchange notification.

Shares of companies led by Gautam Adani were trading lower led by Adani Power's 8.4 percent fall.

Indian equity benchmarks extended losses dragged by Reliance Industries, HDFC twins, ICICI Bank and Infosys.

The Sensex slumped 609 points or 1.7 percent to 35,065 and the NSE Nifty 50 Index dropped 1.8 percent or 196 points to 10,497.

Market breadth was extremely bearish as 1,472 shares were declining while a little over 250 shares were advancing on the BSE.

Shares of real estate companies were among the worst hit in today's session.

Unitech, Indiabulls Real Estate, DLF and Godrej Properties were among the top loser from this space.

Indian equity benchmarks staged a gap down opening after exit polls indicated a tough battle for ruling BJP in MP, Chhattisgarh and Rajasthan.

The S&P BSE Sensex slumped 1.5 percent or 562 points to 35,111 and the NSE Nifty 50 Index dropped 185 points or 1.7 percent to 10,509.

All 19 sector gauges compiled by BSE were trading lower led by the S&P BSE Energy Index's 2.3 percent drop.

Selling pressure was broad-based as the S&P BSE MidCap and S&P BSE SmallCap Indices tumbled 1.5 percent each.

Rupee opened sharply lower at 71.31 per dollar against Friday's close of 70.81.

The local unit fell as much as 0.84 percent or 60 paise to 71.40 against the greenback.

Nomura on Exit Polls

• Exit polls give BJP cold sweat; Set to lose Rajasthan; MP and Chhattisgarh remain nail biters.
• Generally state election outcomes have been known to be a poor leading indicator of general elections.
• BJP’s drubbing to mean that farm unrest is real; increase in MSP haven’t yielded political dividends.

Deutsche Bank Research on REC-PFC Deal

• Limited benefits for combined entity; no material change for REC.
• See negative impact on capital adequacy, credit rating and funding cost for PFC.
• Buyout at premium will be negative for PFC shareholders.

Deutsche Bank Research on Consumer Durables

• Next year's outlook positively guided; September quarter was impacted by high-base, excess inventory and weak season.
• Positive outlook on domestic projects business with 2-5 year upcycle.
• Election to have limited one-quarter impact on project business.
• Voltbek raised capex to Rs 1000 crore to fund expansion in Tier II/III cities.

Morgan Stanley on Cement

• Industry hiked prices in November, but channel checks show reversals in price trends in December
• Prices flattish QoQ in North, Central and East and a marginal drop in West and South in September quarter.
• Cost decline should support margins sequentially and on a yearly basis.

HSBC on Suzlon Energy

• Maintained ‘Buy’; cut price target to Rs 9.5 from Rs 14.
• Recovery post transition pain has been slower and shallower than expected.
• Slower execution issues are being addressed; strong order book lends two years growth visibility.
• Cut target price to factor in lower industry volumes.

Axis Capital on RBL Bank

• Maintained ‘Buy’; hiked price target to Rs 660 from Rs 575.
• Reiterate long-term outlook and belief in execution capability of the bank.
• Bank is significantly investing in future and has capability to leapfrog into league of big banks.
• Expect RBL to scale up materially on more share of high-yielding business, granular and diversified loan book, pan-India presence and room for operating leverage.

• Nifty December futures closed trading at 10735, premium of 41 points
• Max OI for December series at 11,000 Call, OI at 37.1 lakh shares.
• Max OI for December series at 10,500 Put, OI at 35.4 lakh shares.

Insider Trades

• Electrosteel Castings promoter acquired 80k shares from Nov. 30 to Dec. 05.
• JM Financial promoter and director Vishal Kampani acquired 50,000 shares on Dec. 05.
• Axis Bank promoter LIC sold 30.4 lakh shares from Dec. 04-06.
• Lemon Tree Hotels promoter group Sparrow Buildwell acquired 31,200 shares from Dec. 05-06.

Who’s Meeting Whom

• Shopper’s Stop to meet First State Stewart Asia, Axis Capital and other investors from Dec. 11-12.
• PPAP Automotive to meet Ambit Capital on Dec. 10.
• IIFL Holdings to meet Southern East Management on Dec. 10.
• Globus Spirits to meet LIC Mutual Fund, ICICI Pru AMC and other investors on Dec. 10.
• Shriram City Union Finance to meet TenCore Partners, Dolat Capital Makets and other investors from Dec. 10-13.

• Photo finish in MP, Chhattisgarh; Congress ahead in Rajasthan
• What Dalal Street is saying about the exit polls
• Modi or Rahul, who has more at stake in the state polls?
• Vijay Mallya’s extradition case edges towards ruling
• DMK Chief MK Stalin meets Sonia and Rahul Gandhi
• SEBI to expand offer for sale framework, relax FPI investment clubbing norms
• OPEC sends oil prices higher, defying Trump with big output cut
• Arvind Subramanian predicts universal basic income will figure in poll manifestos
• Goldman Sachs’s India CEO expects merger rush to extend in 2019
• India’s Fitbit challenger adds heart, glucose trackers
• Does Subhash Chandra need a commercial break?

Good Morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 1.44 percent or 154 points to 10,584 as of 8:21 a.m.

U.S. stock futures declined with equities in Asia amid a potential escalation of tensions between Washington and Beijing, and after signs China’s economy remains under pressure. Treasury yields extended last week’s retreat and the dollar fell.

Shares fell from Sydney to Hong Kong and futures indicated lower starts for sessions in Europe and the U.S. on Monday.

Short on time? Well, then listen to this podcast for a quick summary of the article!

Stocks

• Japan’s Topix index fell 1.7 percent as of 10:32 a.m. in Tokyo.
• Australia’s S&P/ASX 200 Index lost 1.8 percent.
• Hong Kong’s Hang Seng Index dropped 1 percent.
• The Shanghai Composite Index fell 0.3 percent.
• Futures on the S&P 500 Index were down 0.8 percent. The S&P 500 sank 2.3 percent Friday.
• Futures on the Euro Stoxx 50 lost 1.1 percent.

Currencies

• The yen gained 0.3 percent to 112.33 per dollar.
• The offshore yuan slid 0.1 percent to 6.8935 per dollar.
• The Bloomberg Dollar Spot Index fell 0.2 percent.
• The euro bought $1.1431, up 0.5 percent.
• The pound rose 0.2 percent to $1.2748.

Commodities

• West Texas Intermediate crude held at $52.62 a barrel.
• Gold was little changed at $1,249.82 an ounce after gaining 0.9 percent Friday.