Sensex, Nifty Decline As Dr. Reddy's Triggers Selloff In Pharma Shares
Catch all live updates on share prices, index moves, corporate announcements and more from Indian stock markets today.
KEY HIGHLIGHTS
Closing Bell
Indian stocks erased a gain to decline in line with Asian peers as China’s regulatory crackdown pulls down stocks in the region while local companies continued to report disappointing earnings.
The S&P BSE Sensex shed 0.52% to 52,578.76, and NSE Nifty 50 Index fell by a similar magnitude to 15,746.45. Both the indices had risen 0.3% in early trade.
The S&P BSE MidCap almost mirrored the larger peers as it declined by 0.67% while the S&P BSE SmallCap outperformed the larger peers as it shed 0.11%.
Sixteen of the 19 sectoral indices compiled by the BSE fell, led by the S&P BSE Healthcare, down 2.9%.
The selloff in drugmakers was triggered after Dr. Reddy’s Laboratories reported lower-than-expected net income for the June quarter. The company’s earnings were hurt by weaker performance of North American markets, the region which accounts for a large chunk of revenue for top Indian pharmaceutical companies.
India’s June quarter earnings have been lackluster so far. Of 21 Niftycompanies that have reported earnings, 16 have missed analysts’ estimates while profits of four companies were above the consensus view. Just one company, Kotak Mahindra Bank, reported in line with street view.
On the flipside S&P Metal Index closed nearly 1.7% higher as the Chinese government’s latest move to curb domestic production and tame surging prices was expected to aid India’s steel mills.
The market breadth was slightly skewed in favour of bears. About 1,607 stocks advanced, 1,658 declined and 109 remained unchanged on the BSE
KPR Mill Shares Jump After Board Approves Share Split
Shares of KPR Mill Ltd. gained after the company approved the splitting of each equity share into five, as per an exchange filing.
“The board has recommended the sub-division of one equity share of Rs 5 each fully paid up into five equity shares of Re 1 each fully paid up, subject to the approval of the shareholders of the Company,” it said.
The stock split was approved by the board of directors along with the company’s unaudited financial results for the quarter ended June 30.
Shares of the apparel manufacturing company gained 11.6%, hitting an intraday high of Rs 2,086.25. It then pared some of its gains to still trade around 8.4% higher at Rs 2,026 apiece.
APL Apollo Tubes Hits Record High On Bonus Shares Talk
Shares of APL Apollo Tubes Ltd gained over 9%, the most in over 10 months, to Rs 1,759.00 apiece -- a record high.
The company said its board of directors will consider a proposal for issue of bonus shares. The proposal would be taken up on Aug 6 when the company would report its June quarter earnings as well, the company informed the exchanges today.
Out of the 15 analysts tracking APL Apollo Tubes, 10 maintained ‘buy’, 3 maintained ‘hold’ and 2 analysts maintained ‘sell’ recommendations. The overall consensus price of analysts tracked by Bloomberg implied a downside of 14.2%.
Shares of APL Apollo tubes have added over 100% in 2021 so far.
Pharma Stocks See Worst Day In Seven Month
The Nifty Pharma index is set to log its biggest single-day drop since December 21, 2020 after weak revenue performance by some of the country's top drugmakers.
Ramco Cements Slips Post Lower-Than-Expected June Quarter Earnings
Shares of Ramco Cements Ltd. shed over 5% to Rs 1,050.80 apiece after reporting lower-than-expected June quarter earnings.
Net income at Rs 168.98 crore vs estimate of Rs 184 crore (Bloomberg consensus)
Revenue at Rs 1,205 crore vs estimate of Rs 1,340 crore
Total costs at Rs 984.57 crore vs Rs 1,292.54 crore QoQ
Other income at Rs 6 crore vs Rs 9.88 crore QoQ
Out of the 32 analysts tracking the company, 16 maintained 'buy', 9 maintained ‘hold’ and 7 analysts maintained ‘sell’ recommendations. The overall consensus price of analysts tracked by Bloomberg hinted at a downside of 1.4%.
Canara Bank Recovers After Paring Gains Post June Quarter Numbers
Shares of Canara Bank gained 1.64% to Rs 149.05 apiece after reporting June Quarter numbers. Shares of the bank pared gains soon after it reported the June quarter numbers before recovering.
Net Income at Rs 1,177.47 crore vs Rs 1,010.87 crore QoQ
Interest income at Rs 16,771.65 crore vs Rs 16,315.52 crore QoQ
Interest expense at Rs 10,625.05 crore vs Rs 10,726.31 crore QoQ
Gross NPA at 8.50% vs 8.93% QoQ
Net NPA at 3.46% vs 3.82% QoQ
Provisions at Rs 3,728.52 crore vs Rs 4,134.15 crore QoQ
Out of the 16 analysts tracking the company, 9 maintained ‘buy’, 3 maintained ‘hold’ and 4 maintained ‘sell’ recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 14.6%.
Axis Bank, Hindalco, SBI Life in Focus: Options Watch
Dr Reddy's options volume 7.8x the 20-day average, with 107,537 calls changing hands vs 86,954 puts
Stock down 7.5%, volume 5.5x the 20-day average for this time of day
SBI Life options volume 3.8x the average, with 28,642 calls vs 14,733 puts
Stock up 1.8%, volume 3.6x the average
Hindalco options volume 3.2x the average, with 39,544 calls vs 16,134 puts
Stock up 3.6%, volume 2.4x the average
Bajaj Finserv options volume 2.6x the average, with 28,659 calls vs 17,606 puts
Stock up 2%, volume 0.9x the average
Axis Bank options volume 2.5x the average, with 46,219 calls vs 23,360 puts
Stock down 2.8%, volume 1.7x the average
Bajaj Finance options volume 2x the average, with 90,210 calls vs 37,055 puts
Stock up 1.7%, volume 1.2x the average
Nifty 50 options volume 0.7x the average, with 5.94 million calls vs 6.02 million puts; gauge down 0.5%
Cost of hedging as measured by the 90/110, one-month skew ranks in the 9th percentile over the past year
Nifty Bank index options volume 0.5x the average, with 8.24 million calls vs 8.81 million puts; gauge down 0.3%
90/110, one-month skew in the 90th percentile
India VIX Index up 7%
Market Update: Sensex, Nifty Slide As Earnings Continue To Disappoint
India's stock benchmarks edged lower as investors digested a slew of quarterly earnings.
The S&P BSE Sensex shed 0.4% to 52,651.92, and NSE Nifty 50 Index posted losses of similar magnitude to 15,774.80. Reliance Industries Ltd. contributed the most to the index decline, decreasing 0.7%. Dr Reddy's Laboratories Ltd. had the largest drop, falling 6.7%.
The S&P BSE MidCap almost mirrored the larger peers as it declined by 0.36% while the S&P BSE SmallCap remained largely unchanged. Fourteen of the 19 sectoral indices posted losses with S&P BSE Healthcare declining over 2% and S&P BSE Energy shedding 1%.
The market breadth was skewed in favour of bulls. About 1,702 stocks advanced, 1,437 declined and 137 remained unchanged on the BSE.
Dr Reddy’s Reports Lower-Than-Expected Q1 Earnings
Shares of Dr Reddy’s Laboratories Ltd. shed 2.98% to Rs 5,250.00 apiece after reporting a lower-than-expected earnings in the June quarter.
Net income at Rs 380.4 crore vs estimate of Rs 668 crore (Bloomberg consensus)
Revenue at Rs 4,945.1 crore vs estimate of Rs 5,118 crore
Total costs up 15% YoY at Rs 1,909.2 crore
Ebitda Rs 734.5 crore vs estimate of Rs 1,155 crore
Margins at 14.9% vs 22.1% (estimate: 22.6%)
Revenue Breakup
Generics revenue Rs 4,110 crore vs estimate Rs 4054 crore
North America revenue Rs 1,740 crore vs estimate Rs 1,830 crore
India sales Rs 1060 crore vs estimate Rs 1047 crore
Europe sales Rs 399 crore vs estimate Rs 398 crore
COMMENTARY AND CONTEXT
Working with RDIF for ramping up Sputnik supplies
Working on Baricitinib and Other Covid drugs
MD G V Prasad says ''I am confident about improving our margins in the upcoming quarters which will be led by the scale up of recent launches, new product launches and productivity''
Out of the 42 analysts tracking the company, 35 maintained ‘buy’, 5 maintained ‘hold’ and 2 analysts maintained ‘sell’ recommendations. The overall consensus price of analysts tracked by Bloomberg implies an upside of 8.5%
Glenmark Life Sciences IPO Subscription Status: Day 1
The IPO was subscribed 2.39 times as of 3:00 p.m.
Institutional subscription: 0.00 times
Non-institutional subscription: 0.70 times
Retail subscription: 4.47 times
Research Reports On Glenmark Life Sciences IPO
Alembic Pharma Slips Post Weaker-Than-Expected June Quarter
Shares of Alembic Pharma Ltd. declined as much as 9.64% to Rs 822.10 apiece after reporting a 45.4% YoY decline in net profit in the June quarter.
Net profit down 45% YoY at Rs 164.52 crore vs estimate of Rs 223 crore (Bloomberg consensus)
Revenue down 0.7% YoY at Rs 1,326.03 crore vs estimate of Rs 1,259 crore
Ebitda down 39% YoY at Rs 253.98 crore vs estimate of Rs 322 crore
Total costs up 17% YoY at Rs 1,145.37 crore
Pranav Amin, managing director of Alembic Pharmaceuticals said while the India business grew exceptionally well during the quarter, the U.S. business faced price erosion due to increased competition.
Out of 19 analysts tracking the company, 9 maintained ‘buy’, 6 maintained ‘hold’ and 4 analysts maintained ‘sell’ recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 18%.
Brokerage View
ICICI Securities
Downgraded to ‘reduce’ from ‘hold’ with a target price of Rs 824.
Lower U.S. sales and weak Ebitda margin to weigh on growth.
Competitive pressure in U.S. business led to significant price erosion.
Near-term outlook remains muted.
Delay in inspections at new plants due to covid likely to delay the launches of complex generics.
Motilal Oswal
Maintains ‘neutral’ on the stock with a target price of Rs 970.
Steep price erosion in the base portfolio hurt US business.
Strong performance in the Domestic Formulation (DF) segment a positive.
Lowered FY22E/FY23E earnings estimate by 23%/10% to reflect competitive pressure on base portfolio in the US market.
Key risks
Delay in new approvals/launches of injectable dosages.
Higher operational costs.
Considerable price erosion in U.S. business.
Delay in successful compliance at injectable sites due to covid.
Nirmal Bang
Recommends ‘accumulate’ with a target price of Rs 865.
Continued price erosion in US business dented June quarter earnings.
New ANDA launches in FY22 to offset decline in sales of key products – famotidine, theophylline and sartan.
Growth in domestic branded formulations sales a positive factor.
YES Securities
Recommends ‘buy’ with a target price of Rs 1,100.
Uncertainty around U.S. business and price erosion in key drugs weighed on earnings.
Rebound in domestic business driven by low base as well as Azithromycin drug sales.
One quarter reversal in U.S. business does not temper the long-term optimism.
India Metal Stocks Rally On China Export Curbs
Shares of the metal producers rallied after the Chinese government’s latest move to curb domestic production and tame surging prices was expected to aid India’s steel mills.
China is the biggest steel exporter and is undertaking an industrial overhaul that’s seen it vow to reduce output in 2021 to curb carbon emissions from one of its dirtiest industries. China’s move to concentrate on domestic supply comes after resurgent demand lifted prices to a record earlier this year, and may tighten global markets that are seeing a steel boom as economies navigate their recovery from the pandemic.
Inox Pares Gain After Clarifies On Report Of Amazon Talks
Shares of Inox Leisure pared some of its early gains after the theatre operator said it was not in any discussions with Amazon for a stake sale as reported by a news publication.
“There are no discussions taking place between INOX Leisure and Amazon, nor were there any such discussions in the past. Under the circumstances, the news item is factually incorrect”, Inox Leisure said in that exchange filing.
Inox Leisure leads rally in India’s multiplex operators and entertainment stocks after the Indian Express newspaper reports Amazon.com Inc. is in talks with companies in film and media distribution business, citing people it didn’t identify.
The newspaper report said Amazon India is said to be targeting movie theater chains, including Inox, which have been impacted by Covid-related restrictions
Multiplex operators rise: PVR +2%, UFO Moviez +2.5%, Mukta Arts +3.9%, Cineline India +1%
Entertainment linked stocks also surge: Eros International Media +1%, Tips Industries +3.1%
Axis Bank Slips Post June Quarter
Shares of Axis Bank shed 1.59% to Rs 744.30 after net profit almost doubled while asset quality deteriorated in the June quarter.
Net profit rose 94% YoY to Rs 2,160 crore vs estimate of Rs 2,242 crore
Net interest income gained 11% YoY to Rs 7,760 crore vs estimate of Rs 7,788 crore.
Other income increased 39% to Rs 3,588 crore.
GNPA ratio 3.85% vs 37% QoQ.
Out of the 51 analysts tracking the company, 45 maintained ‘buy’ and 6 analysts maintained ‘hold’ recommendation. The overall consensus price of analysts tracked by Bloomberg implied an upside of 16.8%. Shares of Axis Bank have gained nearly 20% in 2021 so far.
Brokerage View
CLSA
Recommends ‘buy’ with a 12-month target price of Rs 1,050.
June Quarter results in-line with expectation with marginal weakness on asset quality.
Net slippage of 0.65% loans is manageable.
Expect PPOP (Pre-Provision Operating Profit) growth to improve to 15% CAGR.
Expect retail stress to normalize in second half of FY22.
Corporate cycle has clearly turned but SME segment could see elevated slipped in second half of the current fiscal.
Emkay Global
Recommends ‘buy’ with a 12-month target price of Rs 960.
Subdued margins, higher opex weighed on PAT in June quarter.
Growth trajectory to improve as the economy opens up.
Changing portfolio mix towards high margin retail segment to aid margins.
Huge scope to scale up subsidiaries in line with peers.
Strategic investments in insurance (Maxlife) and fintech (Freecharge) to be key growth drivers.
Bank has undergone major transformational journey, fortified the balance sheet and revved up the digital banking platform.
Believe that Axis Bank is ready to accelerate growth and deliver better return ratios.
IDBI Capital
Recommends ‘buy’ with a target price of Rs 875.
Changes in management, strong capital buffer and focus on retail portfolio to aid growth revival.
Credit growth improvement across sectors a positive factor.
Management has proactively written off the stressed assets impacted by covid.
Expect growth to normalize once the near-term stress due to covid eases.
Jefferies
Recommends ‘buy’ with a target price of Rs 910.
June Quarter profit exceeded estimates on lower provisions.
Operating performance in-line with estimates.
Slippage rise is along expected lines while improvement in collections is positive.
Steady performances in corporate and SME segments is a positive factor.
Improvement in lending momentum in retail segment to aid loan growth in upcoming quarters.
19% Casa growth to support loan growth.
Motilal Oswal
Recommends ‘buy’ with a target price of Rs 925.
Earnings in-line, asset quality has deteriorated slightly.
Healthy PCR coupled with additional provision buffer to protect balance sheet against any potential stress.
Contingent provisioning remains stable.
Loan growth remains flat due to a muted business environment.
Expect credit cost to moderate to 1.5%/1.3% over FY22E/FY23E/
Expect Axis Bank to deliver a RoA/RoE of 1.6%/15.2% in FY23E
Nirmal Bang
Recommends ‘buy’ with a target price of Rs 913.
Overall operational performance slightly weaker than anticipated.
NIM likely to inch upwards as slippage decline.
Fee income engine remains well-oiled with rising traction across retail and corporate segments.
Expect asset quality to normalize from Q3FY22.
Growth expected to recover in the near term due to bounce back in retail disbursements and addition in customers across segments.
Prabhudas Lilladher
Recommends ‘accumulate’ with a target price of Rs 860.
Bank’s slippages has been on the higher side and should start subsiding materially in second half of FY22.
PCR of 69%, better growth and tech initiatives to aid balance sheet.
Return ratios improvement is on track
Fee income has been relatively better, while lower opex cost has been a positive.
Collection efficiencies continue to improve while bounce rates have been steady.
Key risks
NIMs remain lackluster while loan growth and cost metrics are still lagging.
Yes Securities
Recommends ‘Buy’ with a target price of Rs 942.
Retention of covid provisions not indicative of weakness.
Change in loan mix, interest reversal and CRR changed led to decline in NIM.
Growth in corporate loans and home loans a positive indicator.
L&T Swings Even As Analysts Maintain Bullish Call Post Q1
Shares of Larsen & Toubro Ltd. swung between gains and losses after the country’s largest engineering-to-construction company reported a 50.4% sequential decline in net profit amid disrupted construction activity across India.
Net profit fell to Rs 1,556.2 crore, while revenue fell 39% over the preceding quarter to Rs 29,334.7 crore. On a year-year on basis, due to a lower base amid national lockdowns, revenue rose 38%, Ebitda increased 95.7% while profit rose 413.4%. The company received fresh orders worth Rs 26,557 crore—which were lower than a quarter ago. Consolidated order book stood at Rs 3,23,721 crore.
"With the waning of the second wave of the pandemic and lockdown restrictions progressively being eased in recent weeks, signs of pick-up in economic activity are visible," it said in a statement.
Brokerages Prabhudas Lilladher, Dolat Capital, Emkay Financial, Nomura and Jefferies all maintained their bullish rating on the company and set target prices that imply an upside potential between 16% and 18.7%.
Shares of the company gained as much as 1.3% and fell as much as 0.8% in early trade. Of the 42 analysts tracking the stock, 40 have a ‘buy’ rating, one suggests a ‘hold’ and one recommends a ‘sell’, according to Bloomberg data. The average of 12-month consensus price targets implies an upside of 13.9%.
Brokerage View
Prabhudas Lilladher
Maintains ‘buy’ rating at a target price of Rs 1,855, implying a potential upside of 16%
L&T reported healthy set of numbers led by execution pick-up across segments along with cost rationalization measures, resulting into margin expansion
Despite second wave of Covid and delay in ordering activity, new orders grew 13% YoY helped by order wins across verticals.
With good order traction from segments such as metros, rural water supply, minerals & metal, power and hydrocarbon offshore, management maintained its guidance of low to mid teen order inflows and revenue growth for FY22.
We believe that L&T is well-placed to emerge stronger given its financial, technical & managerial capability for sustaining and gaining market share.
Given a strong business model, robust bid pipeline, diversified order book and healthy balance sheet, we raise the target price. This is also driven by a 10% rise in core engineering, procurement, and construction multiple, owing to strong visibility and rise in target market cap of subsidiaries.
Dolat Capital
Maintains ‘buy’ rating at a target price of Rs 1,856, implying a potential upside of 16%
L&T’s revenues grew 38% YoY, however came in 6%/2% below than our/ consensus estimates as project progress was impacted with regional lockdowns, shortage of industrial oxygen and supply chain disruptions.
Despite the challenges of Covid restrictions and unfavorable input prices, management remains confident of 12-15% growth in sales and maintaining margins at FY21 levels, which is commendable in our view.
Core business revenue ramp up, infra margin recovery, prudent capital allocation & improving return ratios over FY21‐23 are key stock triggers.
Key overhang would be Hyderabad Metro as it remained in the red due to low ridership of 55k per day (though this has increased to 120k-130k in July), proving to be a cash guzzler with an additional Rs15bn to be invested over 9MFY22E
Emkay Financial
Maintains ‘buy’ rating, raises target price to Rs 1,870 from Rs 1,770 earlier, implying a potential upside of 17%
L&T reported a profit after tax better than our estimate but below consensus. The miss was largely on account of slightly lower margins and a higher tax rate.
LT (ex-services) posted an order inflow up 10% yoy but well below Q1FY20 levels. While the inflow was weak, prospects for the remaining part of the year remained strong.
The increase in TP is solely due to the increase in the value of IT subsidiaries.
Nomura
Maintains ‘buy’ rating, target price increased from Rs 1,654 to Rs 1,870, implying a potential upside of 17%
A relatively uneventful quarter. Execution weaker than our estimate, but Ebitda margin beats despite commodity headwinds
L&T’s results were a relatively mixed bag which, while missing our revenue estimates, were ahead on Ebitda margin, highlighting better cost management. Order inflows were also largely along expected lines.
Management guidance of low-to-mid-teen revenue growth in FY22 appears reasonable; however, order inflow guidance seems ambitious
Potential asset sales of Nabha Power and Uttaranchal hydropower and resolution of Hyderabad Metro financing could be longer-term triggers for the stock
Jefferies
Maintains ‘buy’ rating at a target price of Rs 1,900, implying a potential upside of 18.7%
Pandemic-induced delays, including fatalities and local lockdowns, impacted execution.
Prospect pipeline is up 42% year-on-year and management is optimistic on outlook as Q1 was impacted by the resurgence.
Management reiterated their commitment to reducing debt, creating shareholder value through dividend and reducing cash calls outside the core
We believe L&T is on a re-rating path as it continues to walk the talk on prudent capital allocation and with capex showing recovery trends
Risks include management not following prudent capital allocation and government infra spend not reaching pre-Covid levels and growing.
Tata Motors Swings As Analysts Stay Optimistic On Turnaround
Analysts remain optimistic about a turnaround of Tata Motors Ltd. and its luxury car unit Jaguar Land Rover despite near-term headwinds related to the global chip shortage.
On Monday, Tata Motors reported a net loss for the first quarter of Rs 3,509 crore compared with the analyst estimate for a loss of Rs 2,098 crore. Its shares fluctuated in a narrow range Tuesday, holding onto their gain of 59% for the year.
JLR continues to see buoyant demand, and its order book stands at a record of 110,000 units, reflecting 4-5 months of sales in the U.K. and Europe, while its India business is expected to show a strong cyclical rebound in both trucks and passenger vehicles over the next two fiscal years, Jefferies analyst Nitij Mangal wrote in a note.
Brokerage View
Jefferies (buy, price target Rs 435)
Despite the near-term headwinds, the company is set for a big turnaround over FY23-24, and its Ebitda should in FY24 should be up 90% from the FY21 level
EPS is nearing its past peak, and net auto debt has fallen 85% from FY21
The company is likely to report sequentially better volumes and margins in 2H as production picks up; FY23 should be better as JLR launches new generation models of its key products Range Rover and RR Sport
Edelweiss (buy, price target cut to Rs 397 from Rs 405)
JLR aims to tackle the semiconductor shortage by lowering its breakeven point to 80,000 units per quarter, analyst Chirag Shah wrote in a note
Tata Motors continues to maintain a strong focus on balance sheet improvement, but Covid and the semiconductor shortage have delayed the materialization of same
As production normalises, tailwinds like the model cycle for the JLR–RR launch in nine months followed by a demand revival in CV and sharp cost reduction initiatives, should drive strong free cash flow
JM Financial (buy, price target Rs 365)
JLR’s current inventory is low with about 42,000 units at retailers and 30,000 units with the company; it may witness a further drop in inventory leading to lower retail in 2Q
The company is taking steps to moderate the high order book by reducing discounts as well as decreasing marketing spendsing; it will also restrict purchase of lower derivative models
Favorable mix, sales recovery and cost saving initiatives are expected to support margins going ahead while focus on debt reduction will aid balance sheet strength
Equitas Twins Surge After Amalgamation Nod
Shares of the two companies jumped between 6% and 9% after the board of directors and shareholders of Equitas Holdings Ltd and Equitas Small Finance Bank approved their amalgamation scheme.
The share exchange ratio would result into each shareholder of the transferor company, EHL, getting 226 equity shares of the transferee company, ESFB, for every 100 shares held by them in the holding company.
Earlier this month, Equitas SFB had received Reserve Bank of India's (RBI) nod to apply for amalgamation of the promoter into itself.
The intent of the amalgamation is to comply with the RBI norms on small finance banks, mandating the promoter to reduce the stake in the subsidiary to 40% within five years of commencement of operations by the SFB.
Opening Bell: Sensex, Nifty Off To A Steady Start
Indian equity benchmarks climbed, in line with regional peers, as investors assess a disappointing start to the quarterly earnings.
The S&P BSE Sensex gained as much as 0.3% to 53,024.70, while the NSE Nifty 50 index too advanced by a similar magnitude to 15,881.55. HDFC Bank Ltd. contributed the most to the index gain, increasing 0.7%. Hindalco Industries Ltd. had the largest increase, rising 3.7%.
In early trading, 38 of 50 shares rose, while 12 fell. This month, the index rose 1%.
All but two of the 19 sector sub-indexes compiled by BSE Ltd. climbed, led by a gauge of metal companies.
India’s June quarter earnings have been lackluster so far. Of 20 Nifty companies that have reported earnings, 15 have missed analysts’ estimates while profits of four companies were above the consensus view. Just one company, Kotak Mahindra Bank, met analysts’ estimates.
Rupee May Advance On Inflows, Weaker Dollar
India’s rupee may open higher on potential higher foreign inflows and a weaker dollar. Bonds may come under pressure amid higher crude oil prices.
Bond traders will also focus on Rs 7,000 crore ($940m) of state debt sales Tuesday
Global funds bought Rs 33 crore of sovereign bonds under limits available to foreign investors, and added Rs 17 crore of corporate debt
USD/INR little changed at 74.4187 on Monday
Implied opening from forwards suggest spot may start trading around 74.37
Yield on 6.1% 2031 bond up 1bp at 6.17% on Monday; 5.63% 2026 bond yield down steady at 5.68%
SGX Nifty Climbs In Line Asian Peers Amid Caution Over China Curbs
Most Asian stocks rose Tuesday as China and Hong Kong stabilised from a tailspin sparked by Beijing’s sweeping regulatory overhaul. Another record close on Wall Street also supported sentiment.
Shares fluctuated in Hong Kong but climbed in China and Japan. U.S stock futures inched lower after the S&P 500 hit a new peak, with Tesla Inc. the latest firm to post better-than-expected results. The Nasdaq 100 and Dow Jones Industrial Average also ended at all-time highs.
India's SGX Nifty 50 Index futures for July delivery rose 0.1% to 15,837, while MSCI Asia Pacific Index -0.2%. The NSE Nifty 50 Index fell 0.2% Monday to 15,824.45.
Treasuries and the dollar were steady ahead of this week’s Federal Reserve policy meeting, where officials are expected to discuss an eventual tapering of stimulus.
Elsewhere, Bitcoin pared gains to trade near $37,000 after briefly topping $40,000. Crude oil made a modest advance as as investors bet the global demand recovery will remain intact despite the Covid-19 resurgence.
Back home, Tata Motors, Axis Bank, L&T, DLF, GSK Pharma may react as the companies reported quarterly results after the market closed Monday.
Dr Reddy’s, IndusInd Bank, Dixon Tech, Torrent Pharma, Canara Bank, IndiGo are among the companies scheduled to report earnings Tuesday. GSK Pharma, Torrent Pharma, Abbott India are holding their annual shareholders’ meeting. Foreign investors sold net Rs 215 crore of stocks on July 23, according to NSDL website.
