Sensex, Nifty Clock Their Best Two-Day Rally In Over Three Weeks

Indian equity benchmarks ended higher for the second day, registering their best two-day rally since Nov. 02.

The S&P BSE Sensex Index closed 0.45 percent higher at 35,513.14 and the NSE Nifty 50 Index ended at 10,685.60, up 0.54 percent.

The market breadth, however, was tilted in favour of sellers. Seven out of 11 sectoral gauges compiled by NSE advanced, led by the NSE Nifty IT Index's 1.43 percent gain. On the flipside, the NSE Nifty Pharma Index was the top sectoral loser, down 1.33 percent.

Zydus Wellness

• Stock rose as much as 8.6 percent to Rs 1,241.10
• Trading volume was almost 13 times its 20-day average.

VIP industries

• Stock rose as much as 8.9 percent to Rs 532.35.
• Trading volume was more than five times its 20-day average.

Johnson Controls-Hitachi Air Conditioning India

• Stock fell as much as 1.4 percent to Rs 1,755.45
• Trading volume was more than 40 times its 20-day average.

Zensar Technologies

• Stock rose as much as 4 percent to Rs 227.
• Trading volume was seven times its 20-day average

Moody's Investors Service downgraded Yes Bank Ltd.'s foreign currency issuer rating to Ba1 from Baa3. and cut its outlook to 'negative' from 'stable', Bloomberg reported.

Shares of IFCI rose as much as 6.9 percent to Rs 14.60.

The company received Rs 491.84 crore via NCLT on account of a resolution passed by Binani Cement. It holds 42.16 lakh security receipts in the Binani Cement of the face value of Rs 1,000 each.

The Supreme Court deferred plea on Reliance Communications Ltd. spectrum sale to November 28.

About 11 lakh shares of SBI changed hands in a block deal, according to Bloomberg data. Buyers and sellers were not known immediately.

Shares of Mirc Electronics rose as much as 9.8 percent, the most since April 02, to Rs 26.30.

The company has started making television sets for Reliance Retail, it said in a regulatory filing.

Trading volume was quadruple its 20-day average, Bloomberg data showed.

Limited avenues of private capex and gradual benefits of digitisation in a moderate capex environment will limit the Siemens India’s overall growth over the ensuing two-three years.

That’s the word coming from homegrown brokerage and research firm Edelweiss. “We believe Siemens has embarked on an interesting journey with its new and focused business strategy based on efficiency, aided by digitisation/automation given its robust domain knowledge,” the research report said, adding that the growth visibility, however, over the 12-24 months is limited as the capex cycle is expected to improve only gradually.

Shares of Siemens declined for the second day and fell as much as 1.1 percent to Rs 903.50.

The Indian government will push its central bank to ease lending restrictions for some weak banks and review rules governing its functioning at a board meeting next month, Bloomberg reported quoting people with knowledge of the matter. (More details here)

• Indian equity benchmarks rebounded from day's low.
• The S&P BSE Sensex Index jumped 175 points from day's low and the NSE Nifty 50 Index hovered around 10,650.
• The Market breath, however, was tilted in favour of sellers. About 872 stocks fell and 782 shares advanced on NSE.

Shares of Lupin rose as much as 1.5 percent to Rs 857.70.

The pharmaceutical company's Tarapur facility received EIR from the U.S. drug regulator, according to its stock exchange notification.

“The inspection conducted between Aug. 27 and Aug. 31 concluded with one inspectional observation,” the statement said.

The stock returned 2.4 percent in the past 12 months, compared to a 4.8 percent advance in the Sensex.

Oil fell after rising the most in almost two months as major oil exporters prepare to discuss output policy amid rising price volatility, Bloomberg reported. (Read the full story here).

Shares of the Mukesh Ambani-led conglomerate extended gains for the second day and rose as much as 1.4 percent to Rs 1,124.90.

International brokerage and research firm Bank of America Merrill Lynch (BofAML) raised price target to Rs 1,430 from Rs 1,280, implying a potential upside of nearly 29 percent from the last regular trade.

Here’s what the brokerage had to say about the company.

• Maintained ‘Buy’; hiked price target to Rs 1,430 from Rs 1,280.
• RIL transitioned from an Oil & Gas conglomerate to India's "everything company".
• RIL has crossed tipping point in consumer acceptability.
• Shift from B2B to B2C to help valuations.

63 Moons Technologies Ltd. plans to sell 55.4 percent stake in Atom Technologies for $9.24 million to Japan-based NTT Data Corporation, the company said in a stock exchange notification.

Shares of the company fluctuated between gains and losses to trade at Rs 108.10 apiece after the announcement.

• Indian equity benchmarks traded volatile after fluctuating between gains and losses in the early trade.
• The S&P BSE Sensex Index traded at 35,367 and the NSE Nifty 50 Index traded at 10,624.10.
• About 827 stocks declined and 787 shares advanced on NSE.

Shares of Sun Pharma erased gains and fell nearly 6 percent. The stock was the worst performer on Sensex and Nifty.

The NSE Nifty Metal Index fell nearly 20 percent so far this year, the biggest drop since 2015. The decline in the index was led by the slump in Jindal Stainless Hisar Ltd., Hindustan Copper Ltd. and Vedanta Ltd.

The index fell for the fifth straight trading session and is poised for its longest losing streak in over five months. The Index fell 8.5 percent during the period.

Shares of ONGC fluctuated between gains and losses to trade at Rs 145.95.

About 11 lakh shares changed hands in a block deal, according to Bloomberg data. Buyers and sellers were not known immediately.

The stock declined 19 percent in the past 12 months.

Shares of specialty gas maker and distributor rose as much as 3.9 percent to hit an all-time high of Rs 684.80.

The company's acquisition from BOC Group, Praxair and Linde Holdings Netherlands BV triggered an open offer of its 25 percent equity stake to the public, payable by the acquirers amounting to Rs 589 crore if the full offer is accepted.

The Relative Strength Index was above 70, indicating that the stock may be overbought.

About 12.3 lakh shares of South Indian Bank changed hands in a block deal on NSE, Bloomberg data showed. Buyers and sellers were not known immediately.

Shares of the pharmaceutical company rose as much as 11.2 percent, the most since Nov. 06, 2017, to Rs 224.90.

The company received EIR for postmarketing adverse drug experience inspection by U.S. FDA., according to its stock exchange filing. The report indicates the closure of the inspection which started from June 25-29.

Trading volume was almost 450 times its 20-day average, according to Bloomberg data. The stock declined 32.6 percent so far this year compared to a 5 percent advance in the Sensex.

Shares of the country’s largest drugmaker rose as much as 2.1 percent to Rs 521.20.

The pharmaceutical company entered into a definitive agreement to acquire 100 percent stake in Japan based- Pola Pharma for $1 million, according to its stock exchange notification. The pharma company said that this acquisition will give a commercial presence in the dermatology segment in Japan.

Besides, the company, along with its arm entered into a settlement in the Modafinil Anti-Trust Litigation in the U.S. The company said the settlements extended to all claims brought by direct purchaser Plaintiffs and the terms of the settlement are confidential, it said in a separate exchange filing.

Shares of Jain Irrigation fluctuated between gains and losses to trade at Rs 69.90.

About 20.2 lakh shares changed hands in a single block deal, according to Bloomberg data. Buyers and sellers were not known immediately.

Indian equity benchmarks fluctuated between gains and losses after a mixed open. Both the S&P BSE Sensex Index and the NSE Nifty 50 Index traded a little changed at 35,366 and 10,626 respectively as of 9:20 a.m.

The market breadth was split in the middle. Eight out of 11 sectoral gauges compiled by NSE fell, led by the NSE Nifty Metal Index's 1.15 percent decline. On the flipside, the NSE Nifty IT Index was the top sectoral gainer, up 1.27 percent.

The Indian rupee opened marginally lower against the U.S. dollar. The home currency depreciated as much as 0.2 percent to 71 against the greenback.

It ended a seven-day winning streak on Monday, when the pair rose to as high as 70.29, it highest since Aug 29. On Monday, the RBI relaxed mandatory hedge coverage for external commercial borrowings having an average maturity between three and five years, to 70 percent from 100 percent.

In the bond market, traders will focus on Rs 15,500 crore of debt sales by state governments.

F&O Cues

• Nifty November futures closed trading at 10,639,  premium of 11 points.
• Nifty November open interest down 2.8 percent; Nifty Bank Nov open interest up 12.9 percent.
• Max open interest for November series at 11,000 call option (open interest at 32.6 lakh shares)
• Max open interest for November series at 10,500 put option (open interest at 42.3 lakh shares)

Stocks In F&O Ban

• Adan Enterprises
• Adani Power
• Jet Airways
• DHFL

Put-Call Ratio

• Nifty PCR at 1.64 from 1.46.
• Nifty Bank PCR at 1.34 from 0.94.

Morgan Stanley on Indian Metals

• Domestic steel profitability and valuations at peak.
• Domestic steel demand risk and high leverage add to near-term concerns.
• Prefer stocks with earnings visibility and strong balance sheets.
• Coal India: Upgraded to ‘Overweight’ from ‘Equalweight’; cut price target to Rs 296 from Rs 306.
• JSPL: Downgraded to ‘Equalweight’ from ‘Overweight’; cut price target to Rs 174 from Rs 314.
• JSW Steel: Downgraded to ‘Underweight’ from ‘Equalweight’; cut price target to Rs 278 from Rs 369.
• SAIL: Maintained ‘Underweight’; cut price target to Rs 53 from Rs 75.
• Vedanta: Maintained ‘Equalweight’; cut price target to Rs 235 from Rs 263.
• Hindalco: Maintained ‘Overweight’; cut price target to Rs 290 from Rs 295.

BofAML on Reliance Industries

• Maintained ‘Buy’; hiked price target to Rs 1,430 from Rs 1,280.
• RIL transitioned from an Oil & Gas conglomerate to India's "everything company".
• RIL has crossed tipping point in consumer acceptability.
• Shift from B2B to B2C to help valuations.

JPMorgan on OMCs

• Sharp crude fall opens up space for excise duty hike, steady marketing margins and retail price cuts.
• Retail price cut has been much more slower.
• Implied theoretical marketing margins for OMCs have surged.
• Investors concerned on policy uncertainty and limited visibility on funding of LPG subsidy.

UBS on IT

• Companies with better organic revenue to be more resilient to rupee strength.
• Consensus margins likely at risk; remain more cautious.
• Revenue slowdown beginning to be priced in.
• Continue to remain selective; opportunity to add TCS and Infosys.

Macquarie on HEG

• Maintained ‘Outperform’ with a price target of Rs 5,823.
• Buyback- puts an end to payback concerns.
• High payout to drive re-rating.
• Expansion increases growth visibility.

Deutsche Bank Research on Siemens India

• Maintained ‘Buy’; cut price traget to Rs 1,120 from Rs 1,130.
• Management commentary was selectively positive; upbeat on medium-to-long-term capex story.
• Expect high RoCE digital factories and building segments to lead growth.
• Stock valuation looks attractive.

Deutsche Bank Research on Godrej Properties

• Maintained ‘Buy’ with a price target of Rs 1,000.
• Direct impact of jont venture with Hero cycles in near-term financials is likely to be limited.
• JV should be seen in the context of company’s stated asset-light business model.
• Godrej Properties remains one of the preferred stocks in Indian realty universe.

Earnings To Watch

• Reliance Capital
• Vadilal Industries

Earnings Reaction To Watch

GIC Housing Finance (Q2, YoY)

• Net interest income down 5.2 percent at Rs 89.8 crore.
• Net profit down 1.1 percent at Rs 46.2 crore.

• Sun Pharma entered into a definitive agreement to acquire 100 percent stake in Japan based- Pola Pharma for $1 million. The pharma company said that this acquisition will give commercial presence in dermatology segment in Japan. The pharma major along with its arm enters into settlement in the Modafinil Anti-Trust Litigation in the U.S. .The company said settlements extended to all claims brought by direct purchaser Plaintiffs and the terms of the settlement are confidential.
• Nava Bharat Ventures and its arm signed a contract with Tata Power Trading for power supply of 125MW to Telengana State Grid. The contract commences from Jan. 15 to Apr. 30, next year at a price of Rs 5.75 per unit.
• Unichem Laboratories received EIR for post marketing adverse drug experience inspection by U.S. FDA. The report indicates the closure of inspection which started from June 25-29.
• IFCI received Rs 491.84 crore via NCLT on account of resolution passed by Binani Cements .The company holds 42.16 lakh security receipts in in the Binani Cements of face value of Rs 1,000 each
• NMDC Apr-Oct Output: Production at 15.47 MT and Sales at 16.55MT.
• Linde India’s acquisition from BOC Group, Praxair and Linde Holdings Netherlands BV triggered an open offer of its 25 percent equity stake to the public, payable by the acquirers amounting to Rs 589 crore if the full offer is accepted.

Media Reports

• NIIT Technologies’ promoters are said to be exploring options to sell stake in the company. The promoters hold 30.62 percent stake in the company out of which NIIT owns 23.54 percent stake. (Economic Times)
• South Korea’s Lotte seeks to buy ONGC’s OPAL (The Bell).

• Indian retailers try to create Black Friday buzz this year.
• Crude gains most in two months on optimism over end to oil glut.
• ICRA downgrades Shapoorji Pallonji ratings.
• RCom tells Supreme Court asset sale to Jio at risk.
• Power industry too stressed to increase capacity, says JSPL.
• SMEs need lower rates, support to overcome disruptions, says Sanjeev Sanyal.
• What Indian unicorn founders earn.
• SEBI issues framework on 25 percent borrowing via corporate bonds for large corporates.
• General Motors to cut 10,000 jobs, targets five factories for closing next year.

• Presidents Donald Trump and Xi Jinping plan to meet at the G-20 summit in Argentina that kicks off on Friday.
• Federal Reserve Vice Chairman Richard Clarida speaks in New York on Tuesday and Powell addresses the New York Economic Club on Wednesday.
• Thursday sees the release of the minutes from the Federal Open Market Committee’s November meeting.

• West Texas Intermediate crude was little changed at $51.57 a barrel after jumping 2.4 percent.
• Brent crude traded 0.55 percent lower at $60.15 a barrel.
• Gold was steady at $1,222.40 an ounce.

Good Morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.5 percent to 10,593 as of 8:10 a.m.

Shares in Japan and China posted modest gains, fell in Hong Kong and fluctuated in South Korea. Stocks in Asia traded mixed Tuesday and U.S. futures retreated as President Donald Trump discussed plans for further China tariff increases in the absence of a trade deal.

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