Sensex, Nifty Extend Gains For Fourth Day After MPC Keeps Rates Unchanged

Indian equities ended higher for the fourth consecutive trading session after the Monetary Policy Committee decided to keep interest rates unchanged as expected.

The S&P BSE Sensex rose 0.4 percent to close at 41,306.03 and the NSE Nifty 50 rose 0.4 percent to close at 12,137.95. The broader markets represented by the NSE Nifty 500 Index rose 0.53 percent.

The market breath was tilted in favour of buyers. About 1,021 stocks advanced and 756 shares declined on National Stock Exchange.

Eight out of 11 sectoral gauges compiled by the NSE ended lower, led by the NSE Nifty PSU Bank Index’s 2.83 percent gain. On the flipside, the NSE Nifty FMCG Index was the top sectoral loser, down 0.64 percent.

India’s Monetary Policy Committee decided to keep interest rates unchanged. Concluding its three-day meet, the committee voted to keep the repo rate unchanged at 5.15 percent.

The committee reiterated that its monetary policy stance remains 'accommodative' for as long as it is necessary to revive growth, but decided to maintain a status quo on policy rates amid elevated inflation.

The decision was in line with market expectations. All 36 economists polled by Bloomberg had forecast a status quo in rates. The recent spike in inflation would have given the committee a reason to pause.

Other Key Highlights:

• MPC keeps reverse repo rate unchanged at 4.9 percent
• MPC keeps monetary policy stance unchanged at accommodative
• MPC votes 6-0 to keep rates unchanged

About 23.5 lakh shares of Asian Paints changed hands in a large trade, Bloomberg data showed. Buyers and sellers were not known immediately.

Shares of Lupin fell as much as 2.3 percent to Rs 706 after announcing December quarter results.

Key Earnings Highlights (Q3, YoY)

• Revenue down 5 percent to Rs 3,769 crore (Estimate: Rs 4,278 crore)
• Net loss at Rs 835 crore versus loss of Rs 153 crore (Estimate: Rs 227-crore profit)
• Exceptional loss of Rs 289 crore.
• Ebitda down 37 percent to Rs 429 crore (Estimate: Rs 706 crore)
• Margin at 11.4 percent versus 17.2 percent (Estimate: 16.5 percent)

Shares of Sun Pharmaceutical Industries rose as much as 2.8 percent to Rs 438 after announcing December quarter results.

Key Earnings Highlights (Q3, YoY)

• Revenue up 5 percent to Rs 8,155 crore (Estimate: Rs 8,228 crore)
• Net profit down 27 percent to Rs 914 crore (Estimate: Rs 1,054 crore)
• Ebitda down 14 percent to Rs 1,842 crore (Estimate: Rs 2,153 crore)
• Margin at 22.6 percent versus 27.81 percent (Estimate: 21.2 percent)

Shares of Eicher Motors rose as much as 2.6 percent to Rs 19,988.05 after the company announced its December quarter results.

Key Earnings Highlights (Q3, YoY)

• Revenue up 1.2 percent to Rs 2,371 crore.
• Net profit down 6.3 percent to Rs 499 crore.
• Ebitda down 12.9 percent to Rs 592 crore.
• Margin at 24.96 percent versus 29 percent.

Indian equities gained, but traded off day’s high after the Monetary Policy Committee announced its decision on key interest rates.

The S&P BSE Sensex rose 0.28 percent to 41,262 and the NSE Nifty 50 rose 0.26 percent to 12,121. The 30-stock index and the 50-share gauge had advanced as much as 0.64 percent and 0.59 percent respectively, earlier.

India’s Monetary Policy Committee decided to keep interest rates unchanged. Concluding its three-day meet, the committee voted to keep the repo rate unchanged at 5.15 percent.

The committee reiterated that its monetary policy stance remains 'accommodative' for as long as it is necessary to revive growth, but decided to maintain a status quo on policy rates amid elevated inflation.

The decision was in line with market expectations. All 36 economists polled by Bloomberg had forecast a status quo in rates. The recent spike in inflation would have given the committee a reason to pause.

Other Key Highlights:

• MPC keeps reverse repo rate unchanged at 4.9 percent
• MPC keeps monetary policy stance unchanged at accommodative
• MPC votes 6-0 to keep rates unchanged

Shares of Emami extended gains for the third consecutive trading session. The stock rose as much as 2.9 percent to Rs 316.

The company’s group entered into a binding agreement with Nuvoco Vistas Corporation Ltd. to sell Emami Cement Ltd. for an enterprise value of Rs 5,500 crore, according to a media statement.

The transaction is subject to the customary approvals including from the Competition Commission and is expected to be consummated in next three-to-four months, the statement added.

“This transaction is an important step in our Group’s stated objective of becoming debt-free and with this transaction, we will substantially achieve this objective,” Emami Group’s director Manish Goenka said.

The Brent crude extended rally for the second consecutive trading session. It rose as much as 2.4 percent to $56.58 a barrel and advanced 4.9 percent in two trading sessions.

Shares of Shree Renuka Sugars rose as much as 16.5 percent, the most since Nov. 11, 2018, to Rs 8.85.

Trading volume was more than four times its 20-day average, Bloomberg data showed. The scrip declined 16 percent in the past 12 months compared to a 12 percent gain in the Sensex.

Indian equities extended gins to trade at day’s high after the Monetary Policy Committee announced its decision on key interest rates.

The S&P BSE Sensex rose 0.55 percent to 41,377 and the NSE Nifty 50 rose 0.55 percent to 12,156. The broader markets represented by the NSE Nifty 500 Index rose 0.6 percent.

Reserve Bank of India Governor Shaktikanta Das said that the 'operation twist' is being used to ensure better monetary policy transmission.

Shaktikanta Das says:

• Maintaining surplus liquidity to ensure better monetary policy transmission.
• Corporate bonds are benchmarked to lending rates in G-Secs; if 'Operation Twist' is able to soften G-Sec yields on the longer end, they have a bearing on the corporate bond rates.
• 'Operation Twist' is not being used to manage yields on government securities.

Global stocks climbed back within 1 percent of an all-time high, and bond yields rose, on optimism, the global economy will weather the hit from the coronavirus, a sentiment that was strengthened Thursday by China’s plans for tariff cuts on U.S. imports.

• Futures on the S&P 500 Index rose 0.5 percent.
• Euro Stoxx 50 contracts were up 0.6 percent.
• Japan’s Topix index added 2.1 percent at the 3 p.m. close in Tokyo.
• South Korea’s Kospi index gained 2.7 percent.
• Hang Seng Index rose 2.9 percent.
• Australia’s S&P/ASX 200 Index climbed about 1.1 percent.
• Shanghai Composite Index gained 1.7 percent.
• MSCI Asia Pacific Index advanced 1.8 percent.

Get your daily fix of global markets here.
Source: Bloomberg

The MPC is forecasting GDP growth at 6 percent in FY21, similar to an estimate of 6-6.5 percent put out by the Economic Survey.

The MPC anticipates that a combination of factors may keep headline inflation elevated in the short-run, at least through the first half of 2020-21

Besides, MPC expects retail inflation at 6.5 percent in the fourth quarter of FY20 and at 5.4-5 percent the first half of FY21. Inflation is seen falling to 3.2 percent in the third quarter of next year.

“Overall, the inflation outlook remains highly uncertain. Accordingly, the MPC will remain vigilant about the potential generalisation of inflationary pressures as several of the underlying factors cited earlier appear to be operating in concert,” the committee said.

Shares of the realty firms and housing finance companies advanced in today’s trade.

That came after RBI permitted the extension of ‘date of commencement of commercial operations’ by one year for real estate projects without downgrading asset classification.

“It has been decided to permit extension of date of commencement of commercial operations of project loans for commercial real estate, delayed for reasons beyond the control of promoters, by another one year without downgrading the asset classification, in line with treatment accorded to other project loans for non-infrastructure sector,” The country’s central bank said in a media statement.

“This would complement the initiatives taken by the Government of India in the real estate sector,” RBI added.

The Indian rupee traded little changed at 71.22 against the U.S. dollar after the Monetary Policy Committee announced its decision on key interest rates.

In the bond market the yield on the 10-year note fell as much as two basis points to xx percent.

Indian equities gained after the Monetary Policy Committee announced its decision on key interest rates.

The S&P BSE Sensex rose 0.2 percent to 41,223.80 and the NSE Nifty 50 rose 0.26 percent to 12,122. The broader markets represented by the NSE Nifty 500 Index rose 0.39 percent.

India’s Monetary Policy Committee decided to keep interest rates unchanged

Concluding its three-day meet, the committee voted to keep the repo rate unchanged at 5.15 percent.

The decision was in line with market expectations. All 36 economists polled by Bloomberg had forecast a status quo in rates. The recent spike in inflation would have given the committee a reason to pause.

Shares of Caplin Point Laboratories extended gains for the third consecutive trading session. The stock rose as much as 18.1 percent to Rs 383.50.

The scrip advanced 37 percent in three trading sessions. The Relative Strength Index was at 73, indicating that the stock may be overbought.

Shares of V-Mart Retail extended gains for the fourth consecutive trading session. The stock rose as much as 19.8 percent to Rs 2,513.

Trading volume was more than six times its 20-day average, Bloomberg data showed. The Relative Strength Index was above 70, indicating that the stock may be overbought.

Seven out of 11 sectoral gauges compiled by National Stock Exchange traded higher, led by the NSE Nifty Pharma Index’s 0.9 percent gain. On the flipside, the NSE Nifty Realty Index was the top sectoral loser, down 1.1 percent.

Nifty’s 12,100 call option contract was among the most active Nifty option contracts on National Stock Exchange.

Premium on the contract, which is set to expire on Feb. 6, fell 51.43 percent to Rs 21.30. About 24.98 lakh shares were added to the open interest which stood at over 37.19 lakh shares.

• Ambuja Cements: About 11 lakh shares of the company changed hands in a large trade.
• Asian Paints: About 11.6 lakh shares of the company changed hands in a large trade.
• ICICI Prudential: About 10 lakh shares of the company changed hands in a large trade.
• ITC: About 10 lakh shares of the company changed hands in a large trade.
• Tata Motors: About 10.3 lakh shares of the company changed hands in a large trade.

Buyers and sellers were not known immediately.
Source: Bloomberg

DLF (Q3, YoY)

• Stock fell as much as 2.7 percent to Rs 246.60.
• Revenue down 39.5 percent to Rs 1,342 crore
• Ebitda down 64.3 percent to Rs 237.6 crore
• Margin at 17 percent versus 28.8 percent
• Net profit up 23.5 percent to Rs 414 crore
• Exceptional gains of Rs 231 crore on sale of stake in wholly owned subsidiaries and joint ventures aided net profit.

HPCL (Q3, QoQ)

• Stock fell as much a 1.7 percent to Rs 233.
• Revenue up 16.2 percent to Rs 70,749.6 crore
• Net profit down 29 percent to Rs 747.2 crore
• Ebitda down 19.7 percent to Rs 1,867 crore
• Margin stood at 2.6 percent versus 3.8 percent
• Gross refining margin stood at $1.79 per barrel versus $2.83 per barrel

Gujarat Gas (Q3, QoQ)

• Stock rose as much as 2.9 percent to Rs 305.
• Revenue flat at Rs 2,506.2 crore
• Net profit fell 62 percent to Rs 196.5 crore
• Ebitda flat at Rs 370.6 crore
• Margin stood at 14.8 percent versus 14.8 percent

Cadila Healthcare (Q3, YoY)

• Stock rose as much as 5.3 percent to Rs 285.90.
• Revenue up 1.7 percent to Rs 3,638.1 crore
• Net profit down 26.8 percent to Rs 373.9 crore
• Ebitda fell 17.5 percent to Rs 693.2 crore
• Margin stood at 19.1 percent versus 23.5 percent

Ajanta Pharma (Q3, YoY)

• Stock rose as much as 10.9 percent to Rs 1,328.
• Revenue rose 34.2 percent to Rs 651.2 crore
• Net profit rose 60.8 percent to Rs 107.6 crore
• Ebitda rose 73.3 percent to Rs 186 crore
• Margin stood at 28.6 percent versus 22.13 percent

Divi's Laboratories (Q3, YoY)

• Stock rose as much as 2.4 percent to Rs 2,009.
• Revenue rose 2.7 percent to Rs 1,396.3 crore
• Net profit fell 7.8 percent to Rs 359.1 crore
• Ebitda fell 7.3 percent to Rs 494 crore
• Margin stood at 35.4 percent versus 39.2 percent

Indiabulls Housing Finance (Q3, YoY)

• Stock rose as much as 3.9 percent to Rs 287.75.
• Net interest income fell 50.9 percent to Rs 614.1 crore
• Net profit fell 43.8 percent to Rs 546.9 crore

Brigade Enterprises (Q3, YoY)

• Stock rose as much as 1.6 percent to Rs 235.80.
• Revenue fell 19.7 percent to Rs 552.3 crore
• Net profit rose 1 percent to Rs 49.3 crore
• Ebitda fell 11.5 percent to Rs 155.6 crore
• Margin stood at 28.2 percent

Engineers India (Q3, YoY)

• Stock rose as much as 5.7 percent to Rs 99.50.
• Revenue rose 53.7 percent to Rs 899.2 crore
• Net profit rose 19.4 percent to Rs 111.8 crore
• Ebitda fell 8.7 percent to Rs 89.8 crore
• Margin stood at 10 percent versus 16.8 percent
• Deferred tax reversal of Rs 10 crore in current quarter

Prataap Snacks (Q3, YoY)

• Stock fell as much as 4.7 percent to Rs 778.90.
• Revenue rose 17 percent to Rs 360.7 crore
• Net profit fell 32.1 percent to Rs 5.5 crore
• Ebitda fell 1.8 percent to Rs 21.8 crore
• Margins stood at 6 percent versus 7.2 percent

Shares of Adani Gas Halted their two-day gaining streak. The stock fell as much as 0.7 percent to Rs 171.35.

The company expects Total SA deal to be closed in two weeks. Besides, it is also mulling direct LNG imports when sales volume rise, according to Bloomberg report.

The stock returned 4.7 percent in the past five days and 6.7 percent in the past 30 days, Bloomberg data showed.

Shares of Avenue Supermarts extended gains for the fourth consecutive trading session. The stock rose as much as 4.9 percent to hit an all-time high at Rs 2,360.

The company QIP opened on Feb. 5. The company is looking to raise Rs 3,998.08 crore from the issue of up to 2 crore shares. The SEBI-calculated floor price stands at Rs 1,999.04 per share, which is at a discount of 11 percent of the closing prices.

Trading volume was five times its 20-day average, Bloomberg data showed. The Relative Strength Index was above 70, indicating that the stock may be overbought.

Shares of ITI extended gains for the third consecutive trading session. The stock rose as much as 12.2 percent, the most since Jan. 7, to Rs 94.55.

The company withdrew its follow-on public offer citing prevailing market conditions.

The scrip traded at 31 times its estimated earnings per share for the coming year, according to Bloomberg data.

Indian equities opened higher, led by the gains in Larsen & Toubro Ltd. and Reliance Industries Ltd.

The S&P BSE Sensex rose 0.32 percent to 41,270 and the NSE Nifty 50 rose 0.37 percent to 12,132. The broader markets represented by the NSE Nifty 500 Index rose 0.4 percent.

The market breadth was tilted in favour of buyers. About 1,006 stocks advanced and 457 shares declined on National Stock Exchange.

Ten out of 11 sectoral gauges compiled by NSE traded higher, led by the NSE Nifty Pharma Index’s 0.9 percent gain. On the flipside, the NSE Nifty Realty Index was the only sectoral loser, down 0.5 percent.

Index Futures

• Nifty February futures closed at 12.086.3 discount of 2.8 points versus 15 points
• Nifty February futures open interest down 0.2 percent, sheds 28,000 shares in open interest
• Nifty Bank February futures closed at 31,050, premium 48.4 points versus 31.7 points
• Nifty Bank futures open interest up 4 percent, adds 37,700 shares in open interest

Options

Nifty PCR at 1.38 versus 1.24 (across all series)

Nifty Weekly Expiry: Feb 6

• Max open interest on call side at 12,100 (32.3 lakh shares)
• Max open interest on put side at 12,000 (28.9 lakh shares)
• Open interest addition seen at 12,000P (+19.4 lakh shares), 12,050P (+15 lakh shares), 12,100P (+9.9 lakh shares)
• Open interest shedding seen at 12.000C (-13 lakh shares)

Nifty Monthly Expiry: Feb 27

• Max open interest on call side at 12,500 (21.2 lakh shares)
• Max open interest on put side at 12,000 (28.5 lakh shares)