Four Days Of Gains But Sensex, Nifty Post A Weekly Loss

Indian equity markets could not fully recover the losses made during Thursday's trading session, ending with weekly losses despite gaining for four other days of the week.

The S&P BSE Sensex ended 0.6% higher at 39,982 while the NSE Nifty 50 index ended 0.7% higher at 11,762. Both Sensex and Nifty have posted losses of over 1% this week - the first instance in three weeks.

It was the day of the Metal stocks to shine in today's session. The Nifty Metal index was the top sectoral gainer, ending 4% higher. Three out of the top five Nifty gainers - JSW Steel (up 6.7%), Tata Steel (up 5.4%) and Hindalco (up 3.7%) were metal stocks. This was the biggest single-day gain for the index in close to six months.

The Nifty Bank ended 2% higher, courtesy gains in Private Banks while the Nifty Realty and Nifty Pharma indices were up 2.6% and 1.5% respectively.

What didn't do well in today's session was Nifty Media (down 0.4%) and Nifty I.T. (down 0.1%)

Broader markets outperformed after days of underperformance. The Nifty Midcap index ended 1.1% higher while the smallcap index gained 1.4%.

The India Volatility Index ended 1.9% lower at 21.64.

1,160 stocks on the NSE ended with gains while 675 stocks posted losses.

Shares of the Mumbai-based real estate company are rising in today's session after brokerage firm Emkay initiated coverage on the stock with a buy rating and price target of Rs 393.

Emkay's Rationale:

• Mumbai market stands out among other metros despite high inventory due to upcoming infra upgradation, stable demand and slowing new launches
• Mumbai's inventory overhang may drop to 32 months by FY23 from 44 months
• Improving affordability and market share gains for large organised developers are structural positives
• Potential saleable inventory of over 20 times its FY20 pre-sales and pending receivables from existing/ongoing costs
• Well placed to reap benefits from aggressive push into the affordable homes category.

Shares gained as much as 6.1% - the most in nearly two months to Rs 267.2.

• On a standalone basis, the company has achieved double-digit revenue growth over the same quarter last year.
• Revenue for the current quarter has more than doubled as compared to the previous quarter.
• All JV businesses are at the same level of revenue this quarter as reported in Q2FY20.
• Revenue growth of JV businesses has seen high single-digit growth year-on-year.
• Forging business has continued to do well with growth of over 30% year-on-year, the highest among all product segments.
• Standalone gasket business grew by high single-digits as compared to Q2FY20.
• Achieved maiden business for BS-VI compliant heat shield product from tow of the largest OEMs in the Indian Passenger Vehicle market.

Shares rose as much as 7.6% to Rs 114.7, post the announcement. This is the biggest single-day gain for the stock in two months.

The company has announced that it received approval from the U.S. FDA for its Abbreviated New Drug Application (ANDA) Amantadine Hydrochloride tablets, 100 mg.

The ANDA is therapeutically equivalent to the reference listed drug product, Symmetrel Tablets, 100 mg, of Endo Pharmaceuticals, the company said in an exchange filing.

The drug is used for the treatment of signs and symptoms of infections caused by various strains of influenza A virus.

The drug is also used in the treatment of parkinsonism and drug-induced extrapyramidal reactions, the company said.

Shares are off the day's low and currently trading little changed at Rs 946.8, post the announcement.

• Top gainer on the Nifty Smallcap index
• Gains as much as 12.5% to Rs 37.75
• Biggest single-day gain in four months
• Trades at the highest level in a month
• Today's volumes are more than 11 times its 20-day average
• One-month implied volatility at 165%
• Trading near its 50-Day Moving Average at 37.6 and 100-Day Moving Average at 37.9
• Relative Strength Index (RSI) of the stock is 54.5
• Trading 35% below its 52-week high of Rs 56.2 on July 7, 2020
• The stock has declined 1.5% this year

• U.S. Dollar revenue up 3.4% to $135 million
• Revenue up 1.2% to Rs 1,003.3 crore
• Net profit up 3% to Rs 83.9 crore
• Ebit up 2.5 times to Rs 99.7 crore
• Ebit margin at 9.9% from 4%
• Lower employee costs aid margin expansion
• Other income of Rs 68.4 crore in the base quarter
• Constant Currency Revenue growth of 1.3%
• All numbers are consolidated and compared on a quarter-on-quarter basis

Management Commentary:

• Q3 revenue expected to decline for A&D business due to business cyclicality.
• Outlook for A&D business for the next few quarters remains uncertain due to poor market demand for passenger travel.
• Outlook for communications business for H2FY21 supported by favourable industry trends of technology led network transformation
• Outlook for transportation business in H2FY21 remains positive supported by expectation of a steady recovery in the rail transportation industry.

Shares rose as much as 4.7% to Rs 383.9, before cooling off. The stock has snapped a five-day losing streak.

The drugmaker announced today that Zydus Cadila has received final approval from the U.S. FDA for Fingolimod capsules and Verapamil Hydrochloride injections.

Fingolimod is an immunomodulating drug and is used in the treatment of relapsing forms of multiple sclerosis. The drug will be manufactured at the company's formulations manufacturing facility at SEZ, Ahmedabad.

It has also received permission from the U.S. FDA to market the Verapamil Hydrochloride injection USP, 5mg/2mL and 10 mg/4mL. The injection is used to rapidly or temporarily restore normal heartbeats in people with certain heart rhythm disorders. The injection will be manufactured at the company's facility at Jarod, near Vadodara.

Shares gained as much as 2.9% to Rs 427.9, post the announcement. The stock is the top gainer on the Nifty Pharma index.

• U.S. Dollar revenue up 3.1% to $261 million
• Revenue up 1% to Rs 1,926 crore
• Net profit up 19.1% to Rs 253.7 crore
• Ebit up 11.6% to Rs 321.5 crore
• Ebit margin at 16.7% from 15.1%
• Constant Currency Growth of 2.1%
• Declares interim dividend of Rs 7.5 per share
• All numbers are consolidated and compared on a quarter-on-quarter basis

Of the 38 analysts tracking Mindtree, 16 have a ‘buy’ rating, nine suggest a ‘hold’ and the rest recommends a ‘sell’. The average of Bloomberg consensus 12-month target price is 3.9%.

Shares fell as much as 11.4% - the most since March this year to Rs 1,262. The stock is trading lower for the third day in a row.

• Benchmark indices give up gains; trading little changed
• Nifty up 0.1% at 11,697
• Sensex up 0.2% at 39,823
• Nifty Bank up 0.8% at 23,262
• Nifty Midcap index down 0.2%
• Nifty Smallcap index down 0.5%
• India Volatility Index up 1.4% to 22.38
• Nifty Media and Nifty I.T. are the top sectoral laggards; down 1.4% each
• Nifty Realty is the other sectoral laggard; down 0.7%
• Other sectoral indices are flat and trading with a negative bias
• BPCL is the top Nifty gainer; up 2.2%
• UPL is the top Nifty laggard; down 7.2%
• 811 stocks on the NSE are trading with gains while 848 are declining

The rupee has opened lower for the second straight day, in-line with the cautious sentiment prevailing around the global markets.

The currency opened at 73.43 against the U.S. Dollar as compared to Thursday's close of 73.38. Commerzbank has forecasted the currency to head towards 74.5 towards the end of the year.

Commerzbank in its note said that the rupee has held in a narrow range, consistent with the RBI's new stance of tolerating a stronger rupee to keep a lid on imported inflation.

Yield on the five-year bond rose 10 basis points to 5.26% while that on the benchmark 10-year bond rose 3 basis points to 5.93%.

The government on Thursday expanded its market borrowing plan for the second time this year to Rs 1.3 lakh crore.

ICICI Securities Primary Dealership believes that short-end yields would be under pressure today due to the extra borrowing, as told to Bloomberg.

KPMG, who was the auditor for the company's arm UPL Corporation resigned on Thursday, citing no reason for the same.

“There are no circumstances connected with our resignation which we consider should be brought to the notice of the members,” it said in its letter.

The company clarified late last night that BSE & Co. LLP, who were appointed as statutory auditors of the company in 2017 for a period of five years, continue to remain so. BSR & Co LLP is a sub-licensee of KPMG in India.

It will continue to carry out the audit of Group consolidated financials of UPL, the company said in its clarification.

Shares fell as much as 9.5% - the most in five months to Rs 458.2, the lowest level in over two months.

The government on Thursday banned the imports of 'air conditioners with refrigerants' with a view to promote domestic manufacturing and cut imports of non-essential items.

“Import policy of air conditioners with refrigerants ...is amended from free to prohibited,” the Directorate General of Foreign Trade said in a notification on October 15.

This adds to a list of recent import restrictions as the government is intent to reduce import bill of non-essential goods and promote domestic manufacturing under the Atmanirbhar India policy.

Stock Reaction:

• Blue Star: Shares gained as much as 4.6% - the biggest single-day gain in a month, to Rs 641.
• Voltas: Shares gained as much as 4% - the most in a month to Rs 699. The stock trades at the highest level in nearly eight months and is up for the third straight day.
• Amber Enterprises: Shares rose as much as 15.1% to an all-time high of Rs 2,300. The stock is up for the second straight day.

• Active cases in India decline for 13th straight day
• 63,371 new cases reported in the last 24 hours
• Total confirmed cases now at 73,70,468
• Active cases at 8,04,528
• Patients cured / discharged / migrated at 64,53,779
• Death toll rises to 1,12,161
• 895 deaths reported in the last 24 hours
• 70,338 patients recovered in the last 24 hours

• U.S. Dollar revenue up 6.4% to Rs 2,507 crore
• Revenue up 4.2% to Rs 18,594 crore
• Ebit up 9.7% to Rs 4,016 crore
• Ebit margin at 21.6% from 20.5%
• Net profit up 7.4% to Rs 3,142 crore
• Declares dividend of Rs 4 per share
• Maintains FY21 revenue guidance of 1.5-2.5% growth for Q3 and Q4
• Raises FY21 Ebit margin guidance to 20-21% from 19.5% to 21% earlier
• Constant Currency growth of 4.5% as compared to a company projection of 3.5%

Shares fell as much as 2% to Rs 843.45, post the announcement. The stock is down for the third straight day.

Indian equity markets opened on a sedate note after their biggest fall in over three weeks on Thursday.

The S&P BSE Sensex has opened 0.5% higher at 39,936 while the NSE Nifty 50 index opened above the mark of 11,700 - up o.4% at 11,727.

All sectoral indices have opened higher. THe Nifty Bank and the PSU Bank index have opened with gains of 0.6% while the Nifty Metal, Media and FMCG indices have opened with gains of 0.5% each.

Broader markets have opened with gains. The Midcap index is up 0.5% while the Smallcap index is gaining 0.7% at the start of trading.

• Nifty: Sell 12,000 Call of the October 22 expiry in the range of Rs 32-34. Target of Rs 18-10 and stop loss of Rs 48.
• Nifty Bank: Sell in the range of 23,300-23,350 for target of 23,100-23,000 and stop loss of 23,500.
• Buy MGL October futures for target of Rs 834 and Rs 856.5 with a stop loss of Rs 804
• Sell Bajaj Finance October futures for target of Rs 3,162 and Rs 3,108 with a stop loss of R 3,234.
• Bajaj Finance and MGL are intraday recommendations

Source: ICICI Direct

• AstraZeneca Pharma: To launch Calquence in India on October 21. Company had received import and market permission from Drugs Controller General of India on March 12. The drug is used to treat various types of blood cancer.
• Hindustan Zinc: Board to consider interim dividend in a board meeting on October 20.
• Tech Mahindra: Executes JV with Sumitomo Corporation to provide engineering services to the automotive sector. The proposed JV shall have both partners holding 50% stake each. Each party will initially subscribe to 2,000 ordinary shares and contribute 100 million Yen each towards the stated capital.
• Sun Pharma: Clarified on the news of SEBI probe of its ex-board member Ashwin Dani, saying that it has not received any information or notice either from SEBI or anyone regarding the matter.
• Persistent Systems: To acquire entire business of U.S.-based Capiot Software for $6.34 million. Additional incentive-based payments for the next three years amount to another 6 million. The acquisition is subject to customary closing conditions and is likely to be completed within 2-4 weeks.
• Non-Nifty Earnings Today: Bajaj Consumer Care, Federal Bank, Phillips Carbon Black, IIFL Securities, Shoppers Stop, Tata Communications, Tinplate, Uniply Industries, Shakti Pumps

To know more about earnings reported after market hours, key brokerage updates and F&O cues, click here.

Good Morning!

Indian equity markets gave up gains worth six trading sessions in the final two hours of the weekly options expiry session on Thursday.

The S&P BSE Sensex and NSE Nifty 50 ended over 2.5% lower, bringing their 10-day winning streak to a halt.

The start to the final trading day of the week is likely to be steady, as indicated by the futures. The Singapore-traded SGX Nifty, an early indicator of the Nifty 50 Index’s performance in India, rose 0.5% to 11,755 as of 7:50 a.m.

As of closing on Thursday, the Sensex and Nifty are down close to 2% for the week.

HCL Technologies will be reporting earnings pre-market open today. Among non-index names that will be reporting earnings today include Bajaj Consumer Care, Federal Bank, Phillips Carbon Black, IIFL Securities, Shoppers Stop and Tata Communications.

Asian markets are mixed this morning as investors assess fresh restrictions in various parts of Europe amid a resurgence in Covid-19 cases.

Benchmark indices in South Korea, Japan and Australia are declining while those in Hong Kong are witnessing modest gains.

Futures on the Dow Jones are currently trading higher by 60 points. The index ended little changed on Thursday.

West Texas Intermediate crude fell 0.4% to $40.81 per barrel while Gold was flat at $1,908.1/Oz.

Short on time? Well, then listen to this podcast for a quick summary of All You Need To Know before the opening bell.