Sensex, Nifty Snap Two-Day Losing Streak Led By Banks

Indian equity benchmarks snapped their two-day losing streak in a highly volatile session led by banking and financial services shares.

The S&P BSE Sensex rose 0.51 percent or 181 points to 35,695 and the NSE Nifty 50 Index climbed 0.52 percent or 55 points to 10,727.

For the most part of the day, the benchmarks were highly volatile as the Nifty 50 Index fluctuated 10 times between gains and losses.

All sector gauges barring the Nifty IT Index compiled by National Stock Exchange ended higher led by the Nifty PSU Bank Index's 2.32 percent gain.

People's Bank of China said:

• Reserve-requirement ratio cut to release about 1.5 trillion yuan of liquidity.
• RRR cut to support small, private companies' financing.
• Will continue prudent monetary policy.
• Won't flood economy with liquidity.

Source: Bloomberg

Shares of the Maggi noodles maker fell as much as 4.92 percent, the most in over a month, to Rs 10,655.55 after the apex court revived Indian government’s case against Nestle India seeking damages of Rs 640 crore for alleged unfair trade practices, false labelling and misleading advertisements.

In its press release, Nestle stated that the Supreme Court has directed that reports received from Central Food Technological Research Institute will be the basis for proceedings before the redressal commission.

Shares of the Pune-based state-run lender rose as much as 3.31 percent to Rs 15.60 after its board cleared raising Rs 4,498 crore via preferential allotment to the government of India.

The fund raising is part of the capital infusion process initiated by the government for PSU banks.

Indian equity benchmarks were fluctuating as gains in banking shares were offset by losses in IT stocks.

The Sensex was little changed at 35,521 and the NSE Nifty 50 Index was flat at 10,673.

In intraday deals, the Nifty 50 Index swung eight times between gains and losses.

Eleven of 19 sector gauges compiled by BSE were trading higher led by S&P BSE Bankex Index's 0.7 percent gain. On the flipside, S&P BSE IT Index was top loser, down 1.6 percent.

• South Indian Bank has 88 lakh shares change hands in three blocks. Stock down 0.33 percent at Rs 15.25.

Buyers and sellers were not immediately known

Source: Bloomberg

• Sheela Foam: The Ghaziabad-based mattress maker fell as much as 3 percent to Rs 1,396. Trading volume was more than 10 times its 20-day average.
• Eris Lifesciences: The Ahmedabad-based drugmaker rose as much as 4.67 percent to Rs 710.50. Trading volume was almost eight times its 20-day average.
• Cera Sanitaryware: The Ahmedabad-based sanitary ware maker rose as much as 4.27 percent to Rs 2,480. trading volume was six times its 20-day average.
• SIS: The Delhi-based security services provider rose as much as 1.16 percent to Rs 754.15. Trading volume was more than four times its 20-day average.

Indian equity benchmarks broke out of the rangebound trading led by ITC, HDFC Bank, Axis Bank and State Bank of India.

The S&P BSE Sensex rose 0.51 percent or 178 points to 35,692 and the NSE Nifty 50 Index advanced 0.48 percent or 51 points to 10,722.

Banking shares were leading the rally on Dalal Street paced by gains in Federal Bank and Punjab National Bank.

The gauge of banking share — Nifty Bank Index rose 0.92 percent while Nifty PSU Bank Index advanced 2.24 percent.

Indian equity benchmarks were flat as gains in banking stocks were offset by losses in information technology shares.

The Sensex rose 0.15 percent or 52 points to 35,565 and the NSE Nifty 50 Index rose 0.12 percent or 13 points to 10,684.

Eight of 11 sector gauges compiled by National Stock Exchange were traing higher led by the Nifty PSU Bank Index's 1.35 percent gain. On the other hand, Nifty IT Index was top loser, down 1.54 percent.

Nifty 50 Top Gainers And Losers

Shares of the parent of luxury carmaker — Jaguar Land Rover rose as much as 3.55 percent to Rs 171.95 after Jaguar Land Rover December sales rose 23.6 percent to 14,079 units in U.S.

• Land Rover U.S. sales up 33 percent at 10,617 units versus 7,980 units (YoY)
• Jaguar U.S. sales up 1.4 percent at 3,462 units versus 3,414 units (YoY)

Shares of the Bengaluru-based maker of Jockey inner wear plunged as much as 10.72 percent in the last four trading sessions to Rs 22,532.

In the intraday deals today, Page Industries declined as much as 3.66 percent to Rs 22,751 as trading volumes more than doubled, according to data compiled by Bloomberg.

• ICICI Bank has 13.7 lakh shares change hands in a block. Stock down 1.11 percent at Rs 359.20

Buyers and sellers were not immediately known

Source: Bloomberg

Nifty's 11,000 strike price call option contract was among the most active option contracts on the NSE.

Premium on the contract declined 11 percent to Rs 61.50. Over 2.80 lakh shares were added to the open interest which stood at over 41.91 lakh shares.

Shares of the Mumbai-based airline operator declined as much as 4.5 percent to Rs 236.10 after it proposed to its banks that revenue from ticket sales be securitized against outstanding debt, the Economic Times reports, citing two people with knowledge of the matter.

Securitisation of ticket sales would mean part of the money from advance sales of tickets would go to an escrow account that can be accessed by banks against debt, according to one of the people.

Lenders are unlikely to agree to Jet’s proposal as the money “would be too little” to cover repayments, one person said.

Shares of the Mumbai-based liquor maker fell as much as 13 percent, the most in over two years, to Rs 628 after its net profit declined in December quarter.

Key earnings highlights:

• Revenue up 5.7 percent to Rs 124.6 crore.
• Net profit down 25.1 percent to Rs 16.7 crore.
• Ebitda down 27.2 percent to Rs 24.9 crore.
• Margin at 20 percent versus 29 percent.
• Raw material/sales at 71 percent versus 64 percent (after adjusting excise and other taxes).

Shares of the Chennai-based water and sewage treatment plant builder rose as much as 4.52 percent, the most since Dec. 11, to Rs 266 after Norges Bank acquired 3.31 lakh shares or 0.61 percent equity at Rs 259.53 each.

Norges Bank is the central bank of Norway and it also manages the Government Pension Fund of Norway.

Indian equity benchmarks erased gains led by declines in ICICI Bank, TCS, HCL Technologies and Infosys.

The Sensex fell 0.17 percent or 61 points to 35,453 and the NSE Nifty 50 Index dropped 0.22 percent or 23 points to 10,649.

Till August we had 10-15 percent portfolio in NBFCs without short positions and now with short positions we have reduced portfolio to 6-7 percent, Samir Arora, fund manager at Helios Capital told BloombergQuint in an interview.

Key highlights of the conversation:

• In 2011 when one of the rating agency downgraded U.S. from AAA the rupee corrected by 20 percent.
• If U.S. falls 10-20 percent, Indian markets can outperform but e cannot give positive returns.
• Have a bullish market view government can make announcements and send a little amount of money.
• Generally, in a big picture sense urban India must transfer a little wealth to rural areas.
• Auto ancillary stocks can have a higher weightage in a portfolio than auto companies.
• Best thing in India are private sector banks. Still like them despite growing over 1,000 times in last 20 years.
• Own private sector banks in portfolio from last 15-18 years.
• Till August we had 10-15 percent portfolio in NBFCs without short positions and now with short positions we have reduced portfolio to 6-7 percent.
• We have added two names on the short side and reduced one name from the long side.

Indian equity benchmarks edged higher paced by gains in Tata Motors, Eicher Motors and Bharti Infratel.

The S&P BSE Sensex rose 0.33 percent or 118 points to 35,631 and the NSE Nifty 50 Index climbed 0.4 percent or 44 points to 10,715.

All the 19 sector gauges compiled by BSE were trading higher led by the S&P BSE Auto Index's 0.9 percent gain.

Mid- and small-cap shares were in line with their larger peers as the S&P BSE MidCap Index advanced 0.5 percent and the S&P BSE SmallCap Index rose 0.2 percent.

The Indian rupee strengthened after a two-day fall. The home currency appreciated as much as 0.35 percent to 69.93 against the greenback.

• Why you should keep an eye on health and beauty products maker Marico.
• Nestle’s chart suggests an interesting trend emerging for the Maggi noodles maker.
• Will GM Breweries stock price see a correction?

Find out here

F&O Cues

• Nifty January futures closed trading at 10,718, premium of 46 points.
• Maximum open interest for January series call at 11,000 strike price, open interest at 39.2 lakh shares.
• Maximum open interest for January series put at 10,500 strike price, open interest at 39.6 lakh shares.

Stocks In F&O Ban

• Adani Power
• Jet Airways

Put-Call Ratio

• Nifty PCR at 1.34 from 1.47.
• Nifty Bank PCR at 0.83 from 0.84.

UBS on Federal Bank

• Maintained ‘Buy’; hiked price target to Rs 120 from Rs 95.
• Strong operating growth to drive re-rating.
• NPL risks smaller than expected earlier.
• Increase earnings estimates for the current and the next financial year by 5 percent and 15 percent respectively.

CLSA on Infosys

• Maintained ‘Buy’ with a price target of Rs 910.
• Fruits of 2018-19 investments to be share gains and growth acceleration.
• 2019 is likely to be a year with a catch up with TCS on growth and capital return.
• Infosys should enjoy secular growth improvement; Top picks.

PhillipCapital on Marico

• Maintained ‘Buy’; raised price target to Rs 425 from Rs 370.
• Commodity windfall to aid margins in medium term.
• International business (ex-South Africa) is poised for double-digit constant currency revenue growth.
• Reiterate high conviction Buy; Hike FY19-21 EPS estimates by 5-6 percent on benign input costs.

PhillipCapital on Specialty Chemicals

• Sustained product price to drive value growth.
• Higher rupee realisation to complement conducive industry scenario.
• Improved demand scenario to supports growth.
• Top results picks: Aarti Industries, Vinati Organics, Atul Ltd and Camlin Fine.

JM Financial on Timken India

• Maintained ‘Buy’ with a price target of Rs 675.
• Indian railways spends on rolling stock set to accelerate.
• Exports to sustain double digit growth.
• ABC Bearings facility to see ramp up in production.

• ONGC record date for share buyback.
• SMS Lifesciences price band revised to 10 percent.

VA Tech Wabag

• Norges Bank acquired 3.31 lakh shares or 0.61 percent equity at Rs 259.53 each.

Norges Bank is the central bank of Norway and it also manages the Government Pension Fund of Norway.

GM Breweries (Q3, YoY)

• Revenue up 5.7 percent to Rs 124.6 crore.
• Net profit down 25.1 percent to Rs 16.7 crore.
• Ebitda down 27.2 percent to Rs 24.9 crore.
• Margin at 20 percent versus 29 percent.
• Raw material/sales at 71 percent versus 64 percent (after adjusting excise and other taxes).

• HDFC in its third quarter results said that loan assigned for the quarter stands at Rs 6,959 crore as compared to nil in the corresponding quarter of the previous year. The company also stated that there were no proceeds on account of sale of investments in group companies as compared to last year’s corresponding quarter where it had earned Rs 5,257 crore from the stake sale in the initial public offering of HDFC Standard Life Insurance. Income from dividend stood at Rs 2 crore while in the base quarter is stood at Rs 151 crore, which included Rs 141 crore from HDFC Standard Life Insurance.
• Power Grid Corporation’s board approved investment of Rs 267.33 crore for 500 MW Thyristor Controlled Reactor in Haryana and Rs 112.12 crore for communication scheme under the Central sector for Western Region.
• NHPC Limited said that shutdown of its Himachal Pradesh Power Station will cause a tentative loss of 35.1 MU in production of electricity 6.5 percent in PAF. The tentative financial loss based on the final tariff determination by Central Electricity Regulatory Commission will be around Rs 30.14 crore, the company stated in its press release. On Dec. 20, the company had intimated complete shutdown for this 520 MW Parbati III Power Station Plant in Himachal Pradesh.
• Reliance Communications moved to Supreme Court against Government of India for not clearing spectrum sale to Reliance Jio. The apex court of India will hear the company’s plea on Jan. 7.
• Nestle India said that as per their lawyers who appeared in Supreme Court, the apex court has agreed with the company’s contention on Maggi ban case and has set aside both interim orders passed by National Consumer Disputes Redressal Commission, which was challenged by Nestle. In the press release it was also stated that the Supreme Court has directed that reports received from Central Food Technological Research Institute will be the basis for proceedings before the redressal commission.
• Sun Pharma’s arm completed the acquisition of 100 percent stake in Japan based Pola Pharma. The share agreement for this transaction was done on Nov. 26.
• Vascon Engineers concluded sale of land in Gurgaon and Pune for Rs 50 crore. The management say that sale of these non-core assets will ensure adequate liquidity in the operations.
• Torrent Power appointed as Distribution Franchisee for distribution in three sub-divisions under Thane Urban Circle for 20 years. The circle has a customer base of 2.15 lakh and the company under the agreement will distribute electricity to consumers on behalf of Maharashtra State Electricity Distribution Company, and to upgrade infrastructure.
• CESC Limited appointed as Distribution Franchisee for Malegaon Municipal Corporation in Maharashtra by the state electricity distribution company.

• 10:30am: Nikkei India Services PMI for December, prior 53.7.
• 10:30am: Nikkei India Composite PMI for December, prior 54.5.
• The U.S. December jobs report is due Friday.
• Fed Chair Powell is interviewed with predecessors Janet Yellen and Ben Bernanke at the annual meeting of the American Economic Association Friday. Atlanta Fed President Raphael Bostic joins a panel on long-run macroeconomic performance.

• West Texas Intermediate crude slipped 0.7 percent to $46.78 a barrel.
• Brent crude halted a four-day rally, traded 0.36 percent lower at $55.75 a barrel.
• Gold smashed its way above $1,300 an ounce to extend a new year rally.

London Metal Exchange

• Aluminium ended 2.11 percent higher.
• Copper ended lower for the third day, down 1.81 percent.
• Tin ended higher for the second day, up 0.46 percent.
• Lead ended higher for the third day, down 1.13 percent.
• Nickel ended a little changed.
• Zinc ended lower for the second day, down 1.23 percent.

Good Morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.13 percent to 10,706.50 as of 7:45 a.m.

Asian stocks opened lower, with Japan slumping in its first trading day of the year, after weak economic data added to anxiety about global growth and Apple Inc.’s sales outlook cut sunk U.S. stocks.

Japanese shares tumbled as traders returned from an extended new-year break, with a slide in Apple suppliers and a rally in the yen weighing on sentiment. Australian stocks fell and Chinese futures pointed to a weaker start.