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Sensex, Nifty Log Worst Day Of 2019 On Rising Oil Prices

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Closing Bell: Sensex, Nifty Register Worst Day Of 2019 On Rising Oil Prices

Indian equity benchmarks fell for the second straight session to register their worst fall in 2019 due to concerns over rising crude oil prices. Brent crude prices hovered near a six-month high of $74.31 per barrel.

The S&P BSE Sensex ended 1.26 percent lower at 38,645.18 and the NSE Nifty 50 was 11,594.45 at close, down 1.35 percent. The broader market index represented by the NSE Nifty 500 Index ended 1.43 percent lower.

The market breadth was tilted in favour of sellers. About 1,335 stocks declined and 445 shares advanced on National Stock Exchange.

Ten out of 11 sectoral gauges compiled by NSE ended lower, led by the NSE Nifty Realty Index’s 2.5 percent fall. On the flipside, the NSE Nifty IT Index was the only sectoral gainer, up 0.4 percent.

Sensex, Nifty Log Worst Day Of 2019 On Rising Oil Prices

Stocks Moving On Heavy Volumes

Vinati Organics

  • Shares declined 2.7 percent intraday to Rs 1,720 apiece.
  • The trading volume was more than 20 times its 20-day average for this time of the day.

Aavas Financiers

  • Shares rose as much as 1.5 percent to Rs 1,162.90 per share.
  • The trading volume was almost four times its 20-day average for this time of the day.

Marico

  • Shares fell as much as 1.1 percent to Rs 362.10 apiece.
  • The trading volume was almost four times its 20-day average for this time of the day.

Adani Gas

  • Shares gained nearly 8 percent to Rs 152.30 apiece.
  • The trading volume was almost three times its 20-day average for this time of the day.

Indiabulls Housing Finance Slumps Over 6%

Shares of the non-banking lender declined as much as 6.8 percent, the most in over two months, to Rs 746 apiece. The stock was the top loser on Nifty Index.

The stock declined 44 percent in the past 12 months compared with a 13 percent gain in the Sensex. The stock traded 31 percent below the Bloomberg consensus one-year target price.

Sensex, Nifty Log Worst Day Of 2019 On Rising Oil Prices

Don’t Expect Oil Staying Above $75/Barrel, Says Aditya Birla MF's Patil

Brent crude hovering above $75-80 per barrel could result in “some kind of nervousness” as it could trigger inflation and pause the rate cut cycle. That’s according to Mahesh Patil, Co-Chief Investment Officer at Aditya Birla Mutual Fund. However, Patil does not expect oil to stay at those levels for too long.

Here are the key highlights from the interview:

On Crude

  • Crude is touching $75 per barrel, beyond which it starts to be painful.
  • We are still okay in terms of macro managing on current account deficit or BOP because we've seen good capital inflow.
  • If it goes above $75 or reaches $80-or so, there will be some kind of nervousness.
  • Don't expect crude to stay above $75 for too long.
  • One could see mild correction in the market with crude oil worries and elections.

On Earnings Growth & Sectors

  • Earnings forecast shows 20 percent plus growth for 2020 driven by the banking sector.
  • Looking at a 14 percent growth for the balance sectors (excluding banking), which is decent.
  • Will see some recovery in auto sector going forward.
  • We might see strong earnings growth despite GDP growth remaining constant or meandering around these levels.
  • The liquidity-driven rally has clearly gone away.
  • Market has been punishing companies with weaker management and corporate governance practices.
  • Low base to aid pharma space
  • Good growth coming back in consumer discretionary space
  • Apart from banks, overweight on consumption discretionary, capital goods and infrastructure
  • One should expect average returns from this equity market.

DCB Bank Trades Near Two-Year High

Shares of the private lender gained as much as 4.2 percent to Rs 210.80 apiece, its highest since June 2017.

It announced its March quarter results on Thursday.

  • Net Interest Income rose 14 percent to Rs 301 crore.
  • Net profit gained 50 percent to Rs 96.3 crore.
  • Gross NPA stood at 1.84 percent versus 1.92 percent (QoQ).
  • Net NPA stood at 0.65 percent versus 0.71 percent (QoQ).

Brokerage firm Spark Capital downgraded its recommendation on the stock to ‘Sell’ from ‘Reduce’. It hiked the target price to Rs 179 from Rs 167 per share, implying a potential downside of around 11 percent from previous close.

Brokerage says

  • See a prolonged period of sub-optimal return metrics.
  • Reduce FY20 growth estimate to 19 percent versus 25 percent led by slowdown in overall retail portfolios.
  • Expect bank to raise funds in H2FY20 to support growth trajectory.