Sensex Registers Its Longest Losing Streak In Over Three Months; Rupee Ends At Record Low

The Indian rupee erased early gains and traded near record low against the U.S. dollar.

Indian equity benchmark Sensex closed over 600 points lower from day's high and clocked its longest losing streak in over three months.

The 31-stock index closed 0.86 percent lower at 38,312.52 and the NSE Nifty 50 Index closed below 11,600, down 0.84 percent.

The market breadth was tilted in favour of sellers. Ten out of 11 sectoral gauges compiled by NSE fell, led by NSE Nifty FMCG Index's 2.4 percent decline. On the flipside, NSE Nifty Media Index was the top sectoral gainer, up 0.5 percent.

Network18 Media & Investments

• Stock rose as much as 15.3 percent to Rs 54.80.
• Trading volume was 20.6 times its 20-day average.

Vakrangee

• Stock rose as much as 9.9 percent to Rs 42.65.
• Trading volume was 1.3 times its 20-day average.

Mishra Dhatu Nigham

• Stock rose as much as 13.1 percent to Rs 160.
• Trading volume was 4.6 times its 20-day average.

PC Jeweller

• Stock rose as much as 12.3 percent to Rs 94.65.
• Trading volume was 2.2 times its 20-day average.

Adani Enterprises

• Stock fell as much as 9.4 percent to Rs 204.15.
• Trading volume was 1.2 times its 20-day average.

European equities were mixed, as investors weighed the impact from Italy after Fitch Ratings lowered its outlook on the country.

Shares of the drugmaker rose as much as 2.5 percent to hit a new all-time high at Rs 1,857.

The Relative Strenth Index was 82, indicating that the stock may be overbought, according to Bloomberg data. The scrip returned 32 percent so far this year compared to a 14.7 percent advance in the Sensex.

To ensure its penalties don’t go unpaid, India’s market regulator – SEBI plans to recover fines even when appeals are pending provided its orders have not been stayed, according to two people with direct knowledge of the matter. (Read the full story here)

Shares of the graphite electrode manufacturer rose as much as 3.6 percent to Rs 1,049.

The company’s wholly owned subsidiary in the Netherlands signed an investment agreement for the acquisition of up to 46 percent stake in General Graphene Corporation, an unlisted U.S. company involved in the development of Graphene for commercial applications, according to its stock exchange notification. They will invest up to $18.6 million in multiple tranches in cash.

The stock traded at seven times estimated forward earnings per share compared to 15.8 times for two-year historical average, according to Bloomberg data.

Shares of Reliance Infrastructure pared losses and traded 0.6 percent higher at Rs 480.75 as of 12:15 p.m. The company bagged a Rs 200 crore arbitration award against NHAI, according to its stock exchange notification.

The Relative Strength Index (RSI) was 75, indicating that the stock may be overbought, Bloomberg data showed.

Shares of Balkrishna Industries fell the most in three months after it announced a surprise capital expenditure plan of Rs 1,700 crore.

The company’s board at its meeting on Saturday, approved a capex plan of $100 million to set up a new plant in the U.S., according to its stock exchange notification. (More details here).

• Indian equity benchmarks maintained gains and were trading rangebound.
• The S&P BSE Sensex Index rose 0.17 percent to 38,713.46 as of 11:55 a.m. and the NSE Nifty 50 Index traded at 11,703, up 0.2 percent.
• About 1,107 stocks advanced and 592 shares declined on National Stock Exchange.

Global investors in August bought the most Indian bonds in seven months, showing signs of returning to a market they’d abandoned for the better part of 2018. The inflow brought no joy for currency traders as the rupee hit multiple new lows in the past two weeks. (Read the full story here),

Mahindra & Mahindra Ltd.’s farm equipment's sales rose 7 percent on a yearly basis in August, after it sold 16,641 units during the period, according to its stock exchange notification.

Key sales highlights (YoY):

• Total domestic sales rose 7 percent to 15,356 units.
• Total exports rose 10 percent to 1,285 units.

Shares of M&M fluctuated between gains and losses to trade at Rs 964.60 as if 11:10 a.m.

Shares of the beverage makers rallied in today’s trade, led by Goodricke Group.

The Nikkei India Purchasing Managers Index fell to 51.7 in August, from 52.3 in the previous month, according to a statement by IHS Markit that compiles the index.

A reading below 50 indicates contraction in activity, while a number above it signals expansion. Manufacturing activity in the country has remained above the 50-point-mark for the thirteenth consecutive month.

Shares of Bajaj Auto rose as much as 2.3 percent to trade at over a one-month high at Rs 2,807.

The company sold 4.37 lakh units last month, an increase of 30 percent from the year-ago period, according to its stock exchange filing. This was the highest ever monthly sales that the company recorded so far, it said.

Key sales highlights (YoY):

• Domestic Motorcycle sales rose 27 percent to 2.18 lakh units.
• Motorcycle exports rose 29 percent to 1.44 lakh units.
• Overall Motorcycle sales rose 28 percent to 3.62 lakh units.
• Domestic commercial vehicle sales rose 28 percent to 37,194 units.
• Commercial vehicle exports rose 67 percent to 36,975 units.
• Overall commercial vehicle sales rose 45 percent to 74,169 units.
• Overall domestic sales rose 27 percent to 2.55 lakh units.
• Overall exports rose 35 percent to 1.81 lakh units.

Shares of the information technology company rose as much as 0.7 percent to Rs 1,053.95.

The company partnered with ScienceLogic to bring artificial intelligence operations to its customers. The company will use ScienceLogic’s automation engine along with its machine learning powered software DRYiCE.

The stock traded at 14.5 times estimated forward earnings per share compared to 13.6 times for two-year historical average, Bloomberg data showed.

Shares of the Bengaluru-based information technology company rose as much as 8.9 percent, the most in over five years, to trade at over a seven-month high at Rs 328.

The company bagged a deal which was valued at over $1.5 billion from Alight Solutions LLC. This is the company’s biggest deal so far.

The stock was the best performer on both Sensex and Nifty.

Indian equity benchmarks opened higher, opposing its Asian peers. The S&P BSE Sensex Index traded 0.2 percent higher at 38,710.88 as of 9:20 a.m. and the NSE Nifty 50 Index traded at 11,687, up 0.1 percent.

The market breadth was tilted in favour of buyers. Seven out of 11 sectoral gauges compiled by NSE advanced, led by NSE Nifty IT Index's 1.1 percent gain. On the flipside, NSE Nifty Realty Index was the top sectoral loser, down 1.5 percent.

• The Indian rupee began to trade off record low today. The home currency appreciated 0.3 percent to trade at 70.78 per U.S. dollar.
• The 10-year benchmark bond yields drops to 7.94 percent, after rising in last five trading sessions.

It seems there isn't any respite in sight for the rupee which continues to test new lows against the greeback. The dollar index is back in the green and most regional peers are trading lower. Implied opening from forwards suggest the pair may open at around 70.7250. It may trade in a range of 70.50 - 71.20 in the day.

If currency market is in turmoil, bonds too aren't in great shape. Yield on the 10-year note climbed 8 basis points in the last week, rising to 7.95 percent. RBI Deputy Governor BP Kanungo also flagged that too much dependence of state and central governments on borrowing has led to this increase. Dealers see the 10-year yield in the range of 7.92- 8 percent in the session.

• Nifty September Futures closed trading at 11,735.3 premium of 54.8 points versus 56 points.
• September series-Nifty OI up 6.5 percent and Bank Nifty OI down 3 percent.
• India VIX ended at 12.59, up 1.5 percent.
• Max OI for September series at 11,800 Call, OI at 27.4 lakh, OI up 22 percent.
• Max OI for Sep series at 11,600 Put OI at 32.4 lakh, OI up 28 percent

F&O Ban

None

Put-Call Ratio

• Nifty PCR at 1.55 versus 1.57
• Nifty Bank PCR at 0.98 versus 1.00

BofAML on Wipro

• Maintained ‘Neutral’; raised price target to Rs 300 from Rs 290, implying a potential downside of 0.5 percent form the last regular trade.
• Order bookings have seen an uptick in past two quarters.
• Visibility on healthcare and manufacturing still low for the next six months.
• An improving margin trajectory is likely for rest of the current financial year.

Kotak on United Breweries

• Maintained ‘Sell’ with a price target of Rs 1,100, implying a potential downside of 21.5 percent from the last regular trade.
• The previous financial year was a 180-degree swing from year-beginning to year-end.
• Return ratios improved but cash flow generation remains subdued.
• Like long-term growth potential in beer, but stock is too expensive.

Nomura on Coal India

• Maintained ‘Buy’ with a price target of Rs 320, implying a potential upside of 11.8 percent from the last regular trade.
• Tepid production/offtake growth in August.
• Power plants in India had 10 days of coal inventory as of Aug. 30
• Required run-rate to meet the current financial year’s production/offtake target is 1.7/1.8 MT per day which seem achievable.

Brokerages On Piramal Enterprises

Motilal Oswal

• Maintained ‘Buy’ with a price target of Rs 3,685, implying a potential upside of 15 percent from the last regular trade.
• Builds up a head of steam in financial services.
• Focus more on profitability than growth.
• Well poised to capture growth opportunities that exist in the wholesale lending space.

Citi

• Maintained ‘Neutral’ with a price target of Rs 3,065, implying a potential downside of 4 percent from the last regular trade.
• Expect street to welcome the additional color on financial service business.
• Expect RoE to improve as business appears robust.
• Valuations look fair; See few near-term catalysts.

• Borosil Glass Works placed under ASM framework.
• Jaiprakash Power Ventures’ circuit filter revised to 10 percent.
• L&T Infotech’s two day offer for sale starts today.
• Infosys’ last trading day before going ex bonus.

• Cerebra Integrated Technologies: Societe Generale acquired 10,000 shares or 0.83 percent equity at Rs 41.5 per share.

Page Industries

• Ishares India Index Mauritius Company acquired 57,000 shares or 0.51 percent equity at Rs 34,417.58 per share.
• Integrated Core Strategies (Asia) Pte.Ltd. sold 95,200 shares or 0.85 percent equity at Rs 34,422.8 per share.

Vakrangee

• DB International Asia Limited acquired 68,300 shares or 0.65 percent equity at Rs 38.52 per share.
• Integrated Core Strategies (Asia) Pte. Ltd. acquired 63,900 shares or 0.6 percent equity at Rs 39 per share.

• 10:30 a.m.: Nikkei India Manufacturing PMI for August.
• M&M to report farm equipment sales for August.
• Bajaj Auto to report sales data for August.

• West Texas Intermediate crude stayed above $70 a barrel after rising 2 percent this week.
• Brent crude traded 0.3 percent lower at $77.55 a barrel.
• Gold held at $1,200.47 an ounce.

Shanghai Exchange

• Steel traded lower for second day; down 0.3 percent.
• Aluminium snapped two-day winning streak; down 0.5 percent.
• Zinc traded lower; down 0.5 percent.
• Copper traded higher; up 0.1 percent.
• Rubber traded lower; down 0.2 percent.

Good Morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, traded 0.2 percent higher at 11,750 as of 8:05 a.m.

Asian stocks declined. The stocks slipped in Japan, China and Hong Kong as investors assessed the outlook for trade and whether turmoil in some emerging markets can be contained.

Short on time? Well, then listen to this podcast for a quick summary before the opening bell.