Sensex, Nifty Rebound Short-Lived As Slowdown Concerns Reclaim Focus

Indian benchmark indices snapped their three-day rally and ended lower as slowdown concerns were back in the spotlight.

The S&P BSE Sensex traded 0.50 percent lower at 37,451.84 and the NSE Nifty 50 fell 0.53 percent to 11,046.10. The broader markets represented by the NSE Nifty 500 Index fell 1.02 percent.

"The sentiment has changed since Friday but the underlying fundamentals and earnings [concerns] haven't changed to a large extent," said Rusmik Oza, senior vice president and head of fundamental research at Kotak Securities. Nifty may be rangebound between 10,600 and 11,500 in the near term on weak corporate earnings and more industries slipping into the slowdown net, he told BloombergQuint in an interview.

The market breadth was tilted in favour of sellers. About 1,108 stocks declined and 674 shares advanced on National Stock Exchange.

Eight of the 11 sectoral gauges compiled by NSE traded lower, led by the NSE Nifty Metal Index’s 3.36 percent decline. Nifty Realty Index was the top sectoral gainer, up 2.38 percent.

Shares of the Tata group company reversed day’s losses and traded nearly 1 percent higher at Rs 55.85 each.

Around 10 lakh shares changed hands on National Stock Exchange. The buyers and sellers were not known immediately.

The stock traded 45 percent below the Bloomberg one-year target price.

Indian benchmark indices traded lower in the final hour led by declines in Yes Bank and Indiabulls Housing Finance.

The S&P BSE Sensex traded 0.90 percent lower at 37,303.76 and the NSE Nifty 50 fell 0.91 percent to 11,001.80 as of 2:45 p.m. The broader markets represented by the NSE Nifty 500 Index fell 0.96 percent.

"The sentiment has changed since Friday but the underlying fundamentals and earnings (concerns) haven't changed to a large extent," said Rusmik Oza, senior vice president and head of fundamental research at Kotak Securities. Nifty may be rangebound between 10,600 and 11,500 in the near term on weak corporate earnings and more industries slipping into the slowdown net, he said, in an interview to BloombergQuint.

The market breadth was tilted in favour of sellers. About 1,170 stocks declined and 599 shares advanced on National Stock Exchange.

Nine of the 11 sectoral gauges compiled by NSE traded lower, led by the NSE Nifty Metal Index’s 3.50 percent decline. Nifty Realty Index was the top sectoral gainer, up 1.45 percent.

Shares of the private lender declined as much as 14.8 percent, the biggest intraday slide since its listing in August 2016, to Rs 304 each.

The trading volume was nearly four times the 20-day average for this time of the day, according to Bloomberg data. The relative strength index on the stock was below 30, indicating it may be oversold.

RBL Bank responded to an Economic Times report on employees selling the private lender’s shares. The filing said:

• Employee holding in the Bank is 3.46 crore shares as on Aug 3.
• Transactions in company's shares by employees is a routine activity.
• Employee stock options exercise and sale of shares for July 2019 is in line with the past.
• No Management Committee member including Key Managerial Personal sold shares on July 30 or till date.

Shares of the private lender fell close to 10 percent to Rs 58.10 apiece.

Credit rating firm Moody’s lowered the bank’s rating to Ba3 from Ba1, according to a statement. The firm gave a negative outlook citing risk of further deterioration in the bank’s solvency, funding or liquidity.

Shares of the cigarette maker rose as much as 9.2 percent to a fourth-month high of Rs 1,097.80 apiece.

More than 10 years after splitting their operations, the world’s two largest tobacco companies, Philip Morris International Inc. and Altria Group Inc., are in advanced talks about reuniting in a blockbuster deal that would be the largest since AT&T Inc.’s bid for Time Warner in 2016.

Philip Morris owns 25.1 percent stake in the Mumbai-based company, according to Bloomberg data. The stock traded 14 times its estimated earnings per share for the coming year.

Shares of the power transmission tower maker declined as much as 12.3 percent to Rs 415 each, its lowest price in six months.

The Mumbai-based company received notice from World Bank alleging process violation in bidding for African projects more than seven years ago, according to a bourse notification. The company said it disagrees with World Bank's position and intends to contest the proceedings vigorously, the notification said.

The stock advanced 18 percent in the past 12 months compared with a 4 percent fall in the Sensex.

Nifty Index may be rangebound between 10,600 and 11,500 on weak corporate earnings and more industries slipping into the slowdown net. That’s according Rusmik Oza, senior vice president and head of fundamental research at Kotak Securities.

"The sentiments have changed since last Friday but the underlying fundamentals and earnings (concern) haven't changed to a large extent," said Oza in an interview to BloombergQuint.

Shares of the private lender snapped a three-day gaining streak and declined 6.5 percent intraday to 60.30 apiece.

Yes Bank to consider and approve raising of funds by way of issuance of equity shares during its board meeting scheduled on Aug. 30, according to an exchange filing.

Also, earlier BloombergQuint reported that talks between Yes Bank Ltd. and at least four global private equity funds for a possible stake sale went cold after the funds did not get enough comfort from publicly available information.

Of shares that were traded, 51 percent were at the ask price and 43 percent were at the bid.

Indian benchmark indices traded lower in the forenoon session driven by losses in mining companies.

The S&P BSE Sensex traded 0.45 percent lower at 37,472.60 and the NSE Nifty 50 fell 0.44 percent to 11,056.60 as of 11:46 a.m. The broader markets represented by the NSE Nifty 500 Index fell 0.36 percent.

"The sentiments have changed since last Friday but the underlying fundamentals and earnings (concern) haven't changed to a large extent," said Rusmik Oza, senior vice president and head of fundamental research at Kotak Securities. Nifty may be rangebound between 10,600 and 11,500 on weak corporate earnings and more industries slipping into the slowdown net, he said, in an interview to BloombergQuint.

The market breadth was tilted in favour of sellers. About 926 stocks declined and 766 shares advanced on National Stock Exchange.

Eight of the 11 sectoral gauges compiled by NSE traded lower, led by the NSE Nifty Metal Index’s 2.24 percent decline. Nifty Realty Index was the top sectoral gainer, up 1.19 percent.

Shares of the state-owned coal miner erased opening losses traded 0.4 percent higher to Rs 191.90 apiece.

Indian government moved a step closer to scrapping a cap on foreign investment in commercial coal mining, according to a Bloomberg report quoting a person aware of the development.

The stock has fallen 35 percent in the past 12 months compared to a 3.5 percent decline in the Sensex,

Metal mining companies were among the worst performers on account of uncertainties related to U.S.-China trade war. NSE Nifty Metal Index was the biggest sectoral loser declined as much as 2.1 percent driven by losses in Jindal Steel & Power and Steel Authority of India.

Shares of the Bengaluru-based company snapped its seven-day gaining streak. Coffee Day’s shares hit a lower circuit of 5 percent to trade at Rs 82.85 apiece.

Private equity firm TPG is in exploratory talks to buy the company, reported Economic Times, citing two people in the know of the development. The proposed transaction is expected to value the coffee chain between Rs 3,500-4,000 crore, the report said.

The stock trades at 15 times its estimated earnings per share,according to Bloomberg data.

Shares of the operator of fitness centres were locked in the lower circuit after it fell 5 percent to Rs 8.15 each.

M.K. Dandekar & Co. resigned from the post of statutory auditors on Aug. 16, according to an exchange notification. Auditors cited that failure to receive satisfactory responses for their queries raised from the management during the audit of company’s accounts.

The trading volume was over 200 times the 20-day average for the time of the day, according to Bloomberg data.

Shares of the private lender fell 8.6 percent intraday to Rs 27 apiece.

Credit rating firm S&P placed 'BB' long-term and 'B' short-term foreign currency issuer credit ratings of the bank on CreditWatch with negative implications, according to an exchange filing. The update was on account of the uncertainty regarding the bank's ability to meet its capital requirement in the next three months, the filing added.

The trading volume was nearly five times the 20-day average for this time of the day, Bloomberg data showed.

Indian equity indices fluctuated in opening trade as investors assessed the latest in the unpredictable path of trade talks between the U.S. and China.

The S&P BSE Sensex traded little changed at 37,645 and the NSE Nifty 50 rose 0.10 percent to 11,112.70 as of 9:22 am. The broader markets represented by the NSE Nifty 500 Index fell 0.14 percent.

The market breadth was tilted in favour of buyers. About 835 stocks advanced and 633 shares declined on National Stock Exchange.

Seven of the 11 sectoral gauges compiled by NSE traded higher, led by the NSE Nifty Pharma Index’s 0.80 percent gain. Nifty Metal Index was the top sectoral loser, down 0.65 percent.

The Indian rupee opened lower against the U.S. dollar. The home currency weakened as much as 0.07 percent to Rs 71.53 against the greenback.

Currency traders will await a cabinet meeting scheduled today which is expected to ease foreign direct investment rules in several sectors.

• Talwalkars Better Value Fitness: M.K. Dandekar & Co. resigned from the post of Statutory Auditors on Aug. 16. Auditors cited that failure to receive satisfactory responses for their queries raised from the management during the audit of company’s accounts. Auditors issued their audit report with Disclaimer of Opinion.
• Vedanta: Zambia’s High Court suspended petition by state-owned ZCCM-IH to liquidate Vedanta Resources’ copper mine, pending ruling by country’s appeals court. (Bloomberg News)
• Dilip Buildcon received appointed date (Aug. 27) for EPC projects in Maharashtra from the National Highways Authority of India .
• Essel Propack: Promoter Epsilon Bidco has created a pledge of 75 percent stake of the company’s equity in favour of DB International Trust.
• Power Grid Corp: Board approved investment approval for transmission system for Solar Energy Zones in Rajasthan, at an estimated cost of Rs 2578.5 crore, with the commissioning schedule as December 2020.
• Aster DM Healthcare to set up Innovation and Research Facilities in India and Gulf Countries over the next three years.
• MEP Infra Developers: ICRA withdrew ratings of Bank Limit of Rs 50 crore on account of slower than anticipated progress in the six under-construction HAM Projects.
• Allahabad Bank to price its housing loans with reference to external benchmark linked rates with effect from Sept. 1. Borrowers will have the option for either MCLR-linked loan or EBLR-linked loan at mutually acceptable terms. Saving bank deposits of Rs 40 lakh and above will be linked with External Benchmark with effect from Oct. 1.
• Hinduja Ventures: Board approved mergers of the company’s arm IndusInd Media and Communications with self.
• DHFL to consider various proposals of raising capital and converting debt on Aug. 30. The company defaulted in payment of non-convertible debentures interest aggregating to Rs 14.1 crore which was due on Aug. 26.
• Yes Bank to consider raising capital on Aug. 30.
• Oberoi Realty stated that IT Authorities has left the company’s premises and the company has resumed the normal day to day business activities.
• Fine Organics stated that the company’s new manufacturing facility had started operations in Maharashtra.
• Star Cement stated that the company is committed to go ahead with the buyback offer upon receiving the reply to the clarifications from Securities and Exchange Board of India and Ministry of Finance regarding the amended provisions on share buyback.

• Sintex Industries made Rs 45.8 crore partial redemption for its bonds with Rs 138 crore outstanding principal amount.

Good Morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.05 percent to 11,115 as of 8:45 a.m.

Asian stocks were mixed Wednesday as investors assessed the latest in the unpredictable path of trade talks between the U.S. and China. Benchmarks in Tokyo and Sydney were little changed and edged higher in Seoul.

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