Sensex, Nifty Halt Longest Weekly Gaining Streak In Two Months

Indian equity benchmarks halt three week gaining streak, their longest since the first week of April.

The S&P BSE Sensex ended 0.25 percent lower this week to close at 39,615.90 and the NSE Nifty ended at 11,870.65 after declining 0.44 percent during the period. The broader market index represented by the NSE Nifty 500 Index closed 0.71 percent lower this week.

On Monday, the 31-share index and the 50-stock gauge hit record highs at 40,312.07 and 12,103.05 respectively. The markets were shut Wednesday on account of Id-Ul-Fitr.

On Thursday, the benchmark indices clocked their worst single-day fall in 2019 after the corporate credit rating downgrades dampened sentiment even as the Reserve Bank Of India cut its key policy rate as expected.

Today, Sensex closed 86 points or 0.22 percent higher and the Nifty ended 0.23 percent higher. The NSE Nifty 500 rose 0.14 percent.

The market breadth, however, was tilted in favour of sellers. About 1,057 stocks declined and 705 shares advanced on National Stock Exchange.

Seven out of 11 sectoral gauges compiled by NSE ended lower, led by the NSE Nifty Pharma Index’s 1.2 percent fall. On the flipside, the NSE Nifty Financial Service Index was the top sectoral gainer, up 0.91 percent.

Shares of Ramky Infrastructure rose 1.6 percent to Rs 119.60. The stock rose 4.4 percent intraday.

The company bagged a project worth Rs. 494.04 crore by Rajiv Gandhi Rural Housing Corporation Ltd., according to its stock exchange filing.

Of the shares traded, 40 percent were at the ask price and 50 percent were at the bid, Bloomberg data showed.

Shares of Reliance Infrastructure fell as much as 13.9 percent to hit a record low at Rs 73.05 ahead of its March quarter results announcement.

European stocks are set for a weekly gain, just the second positive week since April as investors bet that looser monetary policy will be used to mitigate the effect of international tariffs.

Source: Bloomberg

Five out of 11 sectoral gauges compiled by NSE fell, led by the NSE Nifty Pharma Index’s 1.2 percent decline. On the flipside, the NSE Nifty Realty Index was the top sectoral gainer, up 0.55 percent.

Nifty’s 11,900 call option contract was among the most active Nifty option contracts on National Stock Exchange.

Premium on the weekly contract which is set to expire on June 13 fell 12.97 percent to Rs 53. Over 6.18 lakh shares were added to the open interest which stood at over 13.94 lakh shares.

The NSE Nifty Bank Index jumped 385 points from day’s low, led by the gains in Yes Bank Ltd. and State Bank of India.

About 13.8 lakh shares of Reliance Power changed hands in a block deal, Bloomberg data showed. Buyers and sellers were not known immediately.

Shares of the media company was locked in lower second-straight day after it declined 20 percent intraday to Rs 42.50 each.

Eros Plc—the promoter of the Indian listed entity said the arm was late two loan interest payments for April and May 2019, in an exchange notification. These interest payments total less than $2 million and are currently in process of remittance, the company said.

The stock fell 68 percent in the last 12 months compared with a 11 percent gain in the Sensex.

Shares of Manappuram Finance fell as much as 11 percent, the most since August 2017, to Rs 122.60.

"Market regulator SEBI issued showcause notices five Asset Management Companies including SBI Fund Management, ING Mutual Fund (now Birla Sunlife) and BNP Paribas and all were with use of of price-sensitive information for trading in Manappuram Finance in March 2013," according to a report by Business Standard.

Trading volume was almost seven times its 20-day average, Bloomberg data showed.

Shares of Indiabulls Real Estate rose as much as 14.7 percent to Rs 151 On Bombay Stock Exchange. The stock rose as much as 10.1 percent to Rs 144.70 On National Stock Exchange.

About 5.79 crore shares or 12.8 percent equity of the company changed hands in a 24 block deals on BSE, Bloomberg data showed.

While Buyers and sellers were not known immediately, Times Of India had reported that Jitu Virwani-led Embassy Group is close to acquiring Indiabulls Real Estate in a deal valued at around $1 billion, quoting two people directly aware of the developments.

Trading volume was 2,144 times its 20-day average, Bloomberg data showed. Of the shares traded, 59 percent were at the ask price and 23 percent were at the bid.

Indian equity benchmarks fluctuated between gains and losses in today’s trade. The benchmark indices had clocked their worst fall in 2019 Thursday.

The S&P BSE Sensex traded 0.06 percent lower at 39,507 as of 9:16 a.m. and the NSE Nifty 50 traded little changed at 11,850. The broader market index represented by the NSE Nifty 500 Index rose as much as 0.17 percent.

The market breadth was tilted in favour of buyers. About 721 stocks advanced and 623 shares declined on National Stock Exchange.

Seven out of 11 sectoral gauges compiled by NSE advanced, led by the NSE Nifty Realty Index’s 0.94 percent gain. On the flipside, the NSE Nifty Pharma Index was the top sectoral loser, down 0.43 percent.

The Indian rupee opened higher against the U.S. dollar. The home currency appreciated as much as 0.1 percent to 69.19 against the greenback.

The sovereign bonds are set for their fourth weekly gains after the central bank eased its stance to accommodative while cutting repo rate by 25 basis points Thursday. Yield on the 10-year bond dropped 9 basis points to 6.93 percent in the last session. While a further rally from hereon looks difficult, the upside on yields is capped. The yield could stay in a range of 6.90-6.95 percent in the day.

Futures- June Series

Nifty

• Nifty futures closed at 11,884, premium of 40 points versus 34 points

Bank Nifty

• Bank Nifty futures closed at 30,939, premium of 82 points versus 51 points

Options

Nifty PCR at 1.36 versus 1.53 (across all series)

Nifty Weekly Expiry 13 June

• Max open interest call side at 12,000 (15.5 lakh shares), 12,100 (13.5 lakh shares)
• Max open interest on put side at 11,900 (6.8 lakh shares)
• open interest addition seen at 12,000C (+13.7 lakh shares), 12,100 C (+9.6 lakh shares)

Nifty Monthly Expiry 27 June

• Max open interest on call side at 12,500 (26 lakh shares)
• Max open interest on put side at 11,500 (27 lakh shares)
• Max open interest addition seen at 12,500 (+6.6 lakh shares), 12,000 (+5 lakh shares)

UBS on Cadila Healthcare

• Upgraded to ‘Neutral’ from ‘Sell’; cut price target to Rs 275 from Rs 350.
• Pricing in potential headwinds in the U.S.; regulatory concerns again.
• Domestic growth likely to be in line with industry.
• See potential consensus earnings downgrades due to rising competition in key products.

HSBC on Indian Aviation

• Rise in airfares has pushed up consensus earnings forecasts too much.
• A number of industry risks seem to have been ignored.
• Indigo and SpiceJet are trading at peak and valuations and at premium to global peers.
• SpiceJet: Downgraded to ‘Reduce’ from ‘Hold’; hiked price target to Rs 115 from Rs 79.
• IndiGo: Maintained ‘Hold’; hiked price target to Rs 1,580 from Rs 1,100.

Citi on CESC

• Maintained ‘Buy’; hiked price target to Rs 895 from Rs 871.
• Dhariwal losses reduced significantly in FY19.
• Distribution business - Next focus area.
• Hike EPS estimates by 12-18 percent over FY20-21 to factor in the latest trends.

Citi on India Economics

• Growth revised downward; inflation broadly unchanged.
• RBI constitutes group to review liquidity framework.
• Expect another rate cut in August.
• Surprise shift in policy stance pushes yields lower; bonds likely to outperform.

Nomura on Apollo Tyres

• Maintained ‘Buy’ with a price target of Rs 247.
• Management expects revival by Aug-19 led by new government policies and good rains.
• In Europe, management expects high single digit growth in the near term.
• Expect healthy growth to continue; find valuations attractive.

CLSA on Consumer

• Not a good end to FY19; weak March quarter results drove earning cuts.
• Deceleration in growth rates across companies.
• QSR firms managed to see expansion despite a deceleration in SSG.
• Two factors to decide fate: their own earnings growth and growth trends in other sectors.

CLSA on Telecom

• 5G auction will fall short.
• Deferring 5G spectrum purchase is preferred.
• Exorbitant 5G spectrum cost a big drag for reasonable IRR; lower cost a must.
• 5G’s strong long-term promise, but limited near-term benefits.

CLSA on Cement

• Ministry concerned about price hikes.
• Govt intervention has been an issue several times in the past and has weighed on stocks.
• Although industry has not necessarily given into pressure by reducing cement prices.
• Currently have positive sector view but will watch out for developments.

• GeeCee Ventures, FDC record date for share buyback.
• Tanla Solutions to move into short term ASM Framework.
• Timken India to move out of short term ASM Framework.

• Emami promoters created pledge of 12.3 lakh shares from May 31-June 1.
• TeamLease Services promoter Hansini Management Consultant created pledge of 84,000 shares on June 6.
• Adani Ports & SEZ revoked pledge of 3.16 lakh shares on June 4.
• Zuari Agro Chemicals promoter Zuari Management Services created pledge of 4.25 lakh shares on June 3.
• Gati promoter group invoked pledge of 24,000 shares on May 29.

• Indiabulls Real Estate: TIIA Cref Funds sold 26.9 lakh shares or 0.9 percent equity at Rs 125.39 each.
• Just Dial: Goldman Sachs sold 6.93 lakh shares or 1.07 percent equity at Rs 739.69 each.

• Wipro: Azim Premji announced his retirement and was appointed as the non-Executive Director till July 2024 and conferred with Founder Chairman of the company. He will retire from current position as Executive Chairman and MD with effect from July 30. Current CEO Abidali Neemuchwala has been appointed as the MD while Rishad Premji was elevated as the executive chairman till July 2024, with effect July 31.
• DHFL: Tata Asset Management Company Ltd. has decided to segregate its investments in Dewan Housing Finance Corporation Ltd. from rest of its portfolio as credit rating agencies downgraded the home financier’s debt papers to default. - Blackstone is planning to transfer funds on June 10 for its purchase of Wadhawan group unit Aadhar Housing Finance, people familiar with the matter said. Funds received by Wadhawan group will be used to repay debt, said one of the people, who asked not to be named as the details are private. (Bloomberg News)
• State Bank of India: said it had been very closely monitoring its exposures in the NBFC sector for the past 10 months and has been taking action as deemed appropriate. The overall quality of the NBFC asset portfolio in its books continues to be good.
• Linde India: Moloy Banerjee resigned from the post of MD and Indranil Bagchi from CFO’s post with effect from June 6, in view of recent and ensuing organizational changes within Linde Group.
• CreditAccess Grameen: completed securitisation of Rs 110.35 crore on June 6.
• Tata Elxsi: selected as System Integrator for Google’s cloud and digital solutions for OTT Media platform.
• CCI approved the acquisition of electrical and automation business of Larsen & Toubro by Schneider Electric and MacRitchie Investments (Source: CCI Release)
• Cyient: announced strategic investment in Rail Cybersecurity Company. (Bloomberg News)
• Sagar Cements: Sales for May rose 13.3 percent to 275,330 MT versus 243,024 MT.
• GHCL: Chairman Sanjay Dalmia said that there was no truth in the speculative reports circulating in the media pertaining to divulgence of Swiss Bank account associated with him and investigations there to. He also stated that he is tax compliant in all matters and GHCL is being independently run by a dedicated and capable professional management team.
• NR Agarwal Industries: Company’s unit 4 to be shut down for annual maintenance and technical upgradation with effect from June 6, the plant is expected to resume production by June 25.
• Eros Media International: Eros Plc., promoter says that the Indian arm was late two loan interest payments for April and May 2019. These interest payments total less than $2 million and are currently in process of remittance.
• Indiabulls Real Estate: Promoter wishes to sell 14 percent stake to third party investors in order to focus of financial services in the long run. Promoter hold 38.72 percent stake in the company. Value of 14 percent stake at CMP is close to Rs 830 crore.
• Cyient: Cylus, a global leader in cybersecurity solutions for the rail industry. This investment is in line with the company’s focus on developing smarter and safer mobility solutions for the rail industry.
• Embassy Group close to Buying Indiabulls Real Estate Stake, according to a TOI report. Embassy Group is close to buying largest stake in Indiabulls Real Estate, followed by a mandatory open offer to take a majority stake. Embassy to acquire 14-15 percent stake from Chairman Sameer Gehlaut and family for Rs 151 per share, a 15 percent premium to Indiabulls Real Estate’s closing price. Embassy and Blackstone will then buy 15-24 percent five to eight weeks later. Embassy will then make a mandatory offer for an additional 26 percent. Gehlaut family may retain a small minority stake.

• West Texas Intermediate crude climbed 1.1 percent to $53.18 a barrel.
• Brent crude traded 0.89 percent higher at $62.22 per barrel.
• Gold dipped 0.1 percent to $1,334.13 an ounce.

London Metal Exchange

• Copper ended little changed.
• Zinc ended 1.67 percent higher.
• Aluminium ended 0.28 percent higher.
• Nickel ended lower for the fifth consecutive trading session, down 0.47 percent.
• Lead ended higher for the fifth consecutive trading session, up 1.34 percent.
• Tin ended higher for the second day, up 0.39 percent.

Good Morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.24 percent to 11,855 as of 7:30 a.m.

Asian stocks traded mixed Friday on reduced volumes as traders awaited a key U.S. jobs report and the outcome of further tariff negotiations between the Trump administration and Mexico.

Shares in Japan and Korea were little changed, while Australian stocks advanced. Markets in Hong Kong and China are shut for holidays.