Sensex Halts Worst Losing Streak Since 2011

Indian equities snapped their worst losing streak in eight years joining a global markets rally led by optimism over U.S.-China trade talks.

Also aiding sentiment was the buoyant outlook on India’s economy and corporate earnings. The benchmark S&P BSE Sensex gained 1.2 percent to 35,770 while the NSE Nifty 50 Index climbed 1.3 to 10,742. This was their best performance since Jan. 31.

The market breadth was tilted in favour of buyers. About 1,098 stocks advanced and 635 shares declined on National Stock Exchange. All 11 sectoral gauges compiled by NSE advanced, led by the NSE Nifty Metal Index’s 2.8 percent rally.

With less than half-an-hour of trade left, Indian equity benchmarks are trading at the session’s high. The S&P BSE Sensex Index gained nearly 400 points to 35,765 while the NSE Nifty 50 was up 1.3 percent at 10,740.

About 10 lakh shares of SBI Life changed hands in a block deal on National Stock Exchange, Bloomberg data showed. Buyers and sellers were not known immediately.

Shares of the company fluctuated between gains and losses to trade 0.1 percent lower at Rs 562 on NSE after the block deal.

European equities opened higher taking cues from their Asian counterparts which gained due to optimism over U.S.-China trade talks.

Shares of the steel makers were leading the fightback with the NSE Nifty Metal benchmark gaining for a second straight session. Jindal Steel contributed the most to the index gains. NALCO was the biggest drag.

Metal stocks have been reeling with the gauge losing 12.6 percent of its market value so far this year.

Shares of the Jockey-brand licensee declined as much as 6.1 percent -- its fifth day of loss -- to Rs 20,300 per share.

The trading volume was more than three 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 the stock may be oversold.

Saudi Aramco is looking at Reliance Industries, others for more India investments, says CEO Amin Nasser.

Nasser says:

• Remain positive and confident about refinery project in India.
• Can catch up in case the location change delays the refinery project.
• India is an investment priority for Saudi Aramco.
• India’s petro-chemicals segment will likely see significant growth.

Source: Bloomberg

Shares of the infrastructure developer halted their 10-day gaining streak, the longest rally ever. The stock fell as much as 3.6 percent to Rs 444.30.

The stock declined 51 percent in the past 12 months compared with a 5.5 percent gain in the Sensex. Sixteen out of 18 analysts tracked by Bloomberg have a ‘Buy’ rating on the stock, while two analysts recommended ‘Hold’.

Shares of the Vadodara-based specialty pharma company erased the day's losses and rose nearly a percent to Rs 544.50 apiece.

The company received U.S. drug regulator’s approval for Acetazolamide capsule, which is used to treat altitude sickness.

The stock declined 5 percent in the past 12 months compared with a 5.5 percent gain in the BSE Sensex Index. The scrip traded 18 times estimated earnings per share for the coming year, according to Bloomberg data.

Nifty’s 10,700 option contract was among the most active Nifty option contracts on National Stock Exchange.

Premium on the contract jumped 84.01 percent to Rs 33.95. Over 2.05 lakh shares were added to the open interest which stood at over 16.87 lakh shares.

Shares of the Pune-based IT firm snapped its three-day blip and rose as much as 7.7 percent, the most since Jan. 24, to Rs 107.50 per share.

The stock traded 6.8 times its estimated earnings per share for the coming year, according to Bloomberg data. The scrip was trading 59 percent below the Bloomberg consensus one-year target price.

Shares of the auto components maker extended gains for the second day and rose as much as 9.7 percent, the most since Nov. 2, 2018, to Rs 314.90.

Brokerage and research firm Maybank upgraded the stock to ‘Buy’ from hold’ with a price target of Rs 350, implying a potential upside of 11.5 percent from the current market price.

Trading volume was more than seven times its 20-day average, Bloomberg data showed. The stock had declined 13.4 percent in the past 12 months compared to an 6.9 percent advance in the Sensex.

Shares of the Reliance Group stocks declined after the Supreme Court held Anil Ambani and three group companies guilty of contempt. The top court said that Ambani would face three months in jail if Ericsson's dues are not cleared.

Shares of the state-run lenders rallied in today’s trade.

The government may infuse up to Rs 47,000 crore capital in 12 state-run banks, Bloomberg reported quoting an official.

Shares of the consumer electronic products manufacturers rallied after the Cabinet approved the National Electronic Policy.

The government aims to achieve a turnover of $400 billion by 2025 in electronic manufacturing, Information Technology Minister Ravi Shankar Prasad said in a press briefing yesterday.

Shares of the Anand Mahindra-led company fluctuated between gains and losses to trade little changed at Rs 663.10.

Brokerage and research firm JPMorgan downgraded the stock to ‘Neutral’ from ‘Overweight’ and cut its price target to Rs 700 from Rs 900, implying a potential upside of 10.7 percent from the last regular trade.

Here’s what JPMorgan had to say about M&M:

• Downgraded the stock due to moderating growth trends and a lack of catalysts.
• Valuations are cheap but unlikely to improve in a hurry.
• Concerns: tractor volume growth peaking, demand slowdown and margin pressure.

Shares of Kaveri Seed fell for the fifth consecutive trading session. The stock declined as much as 12.3 percent in today’s trade to Rs 368.80.

Trading volume was almost 90 times its 20-day average, Bloomberg data showed. The scrip fell 25 percent in the past five days and declined 31 percent in the past 30 days.

The NSE Nifty Realty Index extended gains for the third consecutive trading session ahead of the GST Council Meet.

GST Council Meeting today may decide GST on real estate projects. A panel of ministers has recommended fixing 5 percent as the goods and services tax on under-construction residential properties, a senior government official told BloombergQuint.

Shares of Essel Propack rose as much as 7.4 percent to Rs 118.55, their highest level since Sept. 04.

The company received further Rs 40 crore towards repayment of outstanding dues of inter corporate deposit. The company had already received Rs 25.3 crore last month and the company stated that the balance amount is expected to be received by March.

Trading volume was almost quadruple its 20-day average, Bloomberg data showed. The stock had declined 22 percent in the past 12 months compared to a 4.7 percent advance in the Sensex.

Indian equity benchmarks opened higher, following their Asian peers.

The S&P BSE Sensex Index jumped over 200 points to trade at 36,565.70 and the NSE Nifty 50 Index traded at 10,666.10, up 0.57 percent.

The market breadth was tilted in favour of buyers. About 896 stocks advanced and 454 shares declined on National Stock Exchange.

All the sectoral gauges compiled by NSE advanced, led by the NSE Nifty Realty Index’s 1.25 percent rally.

The Indian rupee opened higher against the U.S. dollar. The home currency appreciated as much as 0.13 percent to 71.26 against the greenback. The local local tender recovered after a four-day fall.

F&O Cues

• Nifty February futures closed trading at 10617, premium of 13 points.
• Max open interest for Feb. 28 series at 11,000 Call (open interest at 41.5 lakh shares).
• Max open interest for Feb. 28 series at 10,400 Put (open interest at 31.1 lakh shares).

Stocks In F&O Ban

In Ban

• Adani Enterprises
• IDBI
• Jet Airways
• Reliance Power
• PC Jeweller
• Reliance Infrastructure

Out of Ban

• CG Power
• Jain Irrigation

Put-Call Ratio

• Nifty PCR at 1.12 versus 1.13.
• Bank Nifty PCR at 0.96 versus 0.94.

JPMorgan on M&M

• Downgraded to ‘Neutral’ from ‘Overweight’; cut price target to Rs 700 from Rs 900.
• Downgraded the stock due to moderating growth trends and lack of catalysts.
• Valuations are cheap but unlikely to improve in a hurry.
• Concerns: Tractor volume growth peaking, demand slowdown and margin pressure.

Edelweiss on CRISIL

• Downgraded to ‘Reduce’ from ‘Hold’ with a price target at Rs 1,331.
• December quarter’s research segment remained subdued due to maturing the U.S. regulations.
• Rating segment is likely to remain subdued over the short term.
• Management has guided for overall mid-single-digit sales growth for 2019.

On Indian Hotels

JPMorgan

• Maintained ‘Overweight’ with a price target at Rs 160.
• Company reiterated its focus on balance sheet optimisation, profitable growth.
• Company was confident of achieving its stated margin target of 25 percent by March 2023.
• Path to achieving cost optimisation to be driven by incremental improvements.

Motilal Oswal

• Maintained ‘Buy’ with a price target at Rs 189.
• Company confident of 2022 goal of being an iconic and profitable hospitality company.
• Industry tailwinds and cost reduction will aid margin expansion.
• Focusing on monetising existing landbank and employing asset-light model.

• Music Broadcast ex-date for share split from Rs 10 to Rs 2 per share.

• Engineers India: ICICI Prudential MF acquired 33.08 lakh shares or 0.52 percent equity at Rs 107.63 each.
• National Aluminium Company: ICICI Prudential MF acquired 94.45 lakh shares or 0.51 percent equity at Rs 50.09 each.

• Yes Bank offered clarification on its decision to release parts of a confidential risk assessment report days after the Reserve Bank of India censured it for doing so. The bank also stated that it has not made any undue benefit by disseminating the information and was in due compliance.
• The U.S. Supreme Court Chief Justice John Roberts rejected Indivior’s bid to protect Suboxone film, the company’s treatment for opioid addiction. The court also refused to block Dr. Reddy’s Laboratories and others from selling generic versions of Suboxone film.
• Coal India, Vedanta: CCEA approved the methodology for allowing the allocation of coal mines for specified end-use or own consumption, to 25 percent of actual production on run of mine basis in open market with payment of additional premium on such sale.
• Redington India, MIRC Electronics, Dixon Technologies, Shivalik Bimetal Controls: Cabinet approved National Electronic Policy. IT Minister Ravi Shankar Prasad stated that the aim is to target $400 billion by 2025 in electronic manufacturing.
• TATA Power, Torrent Power: Cabinet approved rooftop solar generation phase II to add 40,000 MW of solar power by 2022.
• Vedanta clarified on news that the Supreme Court had revoked the National Green Tribunal’s order to open the company’s smelter and it will proceed to file a writ petition before the high court. The company also stated that it is not in the process of submitting any revised bid for Essar Steel.
• Maharashtra Seamless made payment of Rs 477 crore for the acquisition of United Seamless Tubulaar as per the insolvency resolution process as approved by the NCLT.
• Reliance Power clarified on the news that lenders won’t sell ADAG group stocks till Sept. 30 stating that information relates to the promoter group and not the company.
• Majesco arm received a contract for digital solutions from American Public Life Insurance Company.
• JK Tyre and Industries appointed Sanjeev Aggarwal as CFO of the company with effect from Feb. 18.
• Essel Propack received further Rs 40 crore towards repayment of outstanding dues of inter corporate deposit. The company had already received Rs 25.3 crore last month and the company stated that the balance amount is expected to be received by March.
• Prism Johnson issued letter of intent for an EPC contract to set up a 22 MW power generation system in Madhya Pradesh. This system would require an investment of Rs 200 crore and would be commissioned by June 2020.
• Sanofi clarified on the news that the High Court quashing the case against the company. The said litigation pertains to honorarium paid by the Company to a doctor in relation to patient education initiatives. The company says that his litigation is not a material event.
• Emami Realty approved raising Rs 100 crore via NCDs.

• GST Council Meeting today may decide GST on real estate projects. A panel of ministers has recommended fixing 5 percent as the goods and services tax on under-construction residential properties, Bloomberg reported quoting people with knowledge of the matter.
• The Federal Reserve will on Wednesday publish minutes from its recent meeting, with the European Central Bank following suit on Thursday.
• Bank of Canada Governor Stephen Poloz speaks on Thursday; ECB President Mario Draghi speaks on Friday, the same day Reserve Bank of Australia Governor Philip Lowe gives parliamentary testimony.
• An Indonesian rate decision is due Thursday.

• Brent crude traded lower for the second day, down 0.4 percent.
• West Texas crude slipped 0.3 percent to $55.95 a barrel.
• Gold dipped 0.1 percent to $1,339.61 an ounce.

London Metal Exchange

• Aluminium ended flat.
• Nickel ended higher for the third day, up 1.65 percent.
• Copper ended higher for the fifth day, up 0.7 percent.
• Lead ended lower for the second day, down 0.4 percent.
• Tin ended 0.12 percent higher.
• Zinc ended 0.7 percent higher.

Good Morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.52 percent to 10,669.50 as of 8:85 a.m.

Asian stocks climbed after positive earnings sentiment helped boost U.S. equities, while Treasuries pushed higher as trade concerns lingered.

Shares in South Korea and Hong Kong led the region, with the MSCI Asia Pacific Index trading at the highest since early October.

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