MARKET WRAP: Benchmarks flat, mid-caps rally; RIL up 3% ahead of Q3 nos

Topics MARKET WRAP | Markets

After bouts of volatility in the last two trading sessions, markets took a breather on Friday and traded flat for better part of the day. While financial and banking counters traded in the sea of red throughout the day, index heavyweights like Reliance Industries and Bharti Airtel, that surged 3 per cent and 6 per cent, respectively in the intra-day trade today, provided the necessary support. 

In the intra-day trade, the S&P BSE Sensex hit a record high of 42063.93. At close, the 30-share index was at 41,945.37 level, up 12.81 points or 0.031 per cent. Bharti Airtel, that gained over 6 per cent today, was the top gainer at close. The stock hit an over 2-year high of Rs 503.60 on the BSE amid expectations that the telecom company is poised for strong market share gain if payment due to AGR makes Vodafone Idea exit the industry. On the downside, IndusInd Bank was the top loser, down 2 per cent, due to its high exposure towards telecom companies. 

On the NSE, the Nifty50 settled 3.15 points, or 0.025 per cent, lower at 12,352.35-mark. Nifty Bank, financial services, metals and IT indices settled the day in the negative territory. On the other hand, Nifty Pharma gained nearly 2 per cent.

For the week, the Sensex has advanced 0.9 per cent, while the broader Nifty50 has gained 0.8 per cent. Nifty mid-cap index, meanwhile, has risen 4 per cent during the week. 

The party in the broader markets continued for the ninth straight session. The S&P BSE mid-cap index was up 0.5 per cent at 15,703 level. Meanwhile, the S&P BSE small-cap index ended at 14,708.70 level, up 0.42 per cent.

GLOBAL MARKETS

Asian shares rose on Friday after Q4 GDP data in China, for calendar year 2019, showed pressure on the world’s second biggest economy may be starting to diminish. The news along with easing trade tensions with the United States underpinned riskier assets, even as some markets took a breather in late afternoon trade.

MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.18 per cent in afternoon trade, while China’s blue-chip index ended 0.14 per cent higher.

Australian shares added 0.32 per cent to a fifth consecutive record high close, and Seoul’s KOSPI rose 0.11 per cent. 

In early European trades, pan-region Euro Stoxx 50 futures were up 0.4 per cent, German DAX futures gained 0.54 per cent and FTSE futures added 0.28 per cent.

(With inputs from Reuters)


3:55 PM IST As anticipated Mid & Small caps are outpacing the broader market due to fall in economic risk and revival in business growth, this catch-up, which will be the theme of the year. Main indices are impacted by SC verdict on AGR, having an effect on Telecom & Banking sectors which are already facing NPA problem. The pre-budget rally has been very solid on a MoM basis, market may consolidate in the short-term and take cues from the actual budget and on-going results.

3:41 PM IST

3:40 PM IST

3:36 PM IST The S&P BSE Sensex ended at 41,945, up 13 points or 0.03 per cent while NSE's Nifty slipped 3 points or 0.03 per cent to settle at 12,352. 

3:20 PM IST The overall performance has been satisfactory across H1FY20 barring order inflows, which was a result of a weak domestic market. It is quite evident that previous order inflows guidance will be pruned down but the same would comfortably ensure 13.7% revenue CAGR in FY19-21E. This will be one of the best performances in our midcap capital goods universe. Also, gains in railways business margins are not factored by us. We continue to value the stock at 11.5x FY21E EPS and maintain our BUY rating (target price of Rs 335) as risk reward is favourable at this juncture.

3:11 PM IST

3:09 PM IST

2:58 PM IST We reiterate our BUY rating on the stock with a TP of Rs 1,872 (22x Dec-21E) given diversified portfolio that continues to attract and retain customers, presence in widespread geographies that diversifies business risk, stability of margins (standard deviation of EBITDA margins over FY10-19 at 2.0), and ability to generate nearly 20% RoCE.

2:46 PM IST Except for a few proposals like the one on gold and commodity ETFs, most of the changes sought by the industry have been represented in the past.   "We are hoping this time our long-pending submissions get addressed, which would help to take the Indian MF industry, not only to the next level of growth, but also help in contributing to making economy stronger," said N S Venkatesh, chief executive of Amfi. READ MORE

2:38 PM IST Shares of Piramal Enterprises (PEL) rallied 7 per cent to hit 52-week high of Rs 1,656 on the National Stock Exchange (NSE), after the company announced divestment of its Decision Resource Group (DRG) business for $950 million. “PEL DRG Dutch HoldCo BV, a 100 per cent subsidiary of PEL and the holding company for Decision Resources Group (DRG) engaged in healthcare insights & analytics business, has signed a definitive agreement for the sale of DRG to Clarivate Analytics plc, a global leader in providing trusted insights and analytics, for a sale consideration of US $950 million,” the company said in a press release. READ MORE

2:30 PM IST Asian shares rose on Friday after data in China showed pressure on the world’s second biggest economy may be starting to diminish. The news along with easing trade tensions with the United States underpinned riskier assets, even as some markets took a breather in late afternoon trade.   MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.18 per cent in afternoon trade, trimming earlier gains of as much as 0.4 per cent. China’s blue-chip index ended 0.14 per cent higher, down from an earlier rise of as much as 0.67 oer cent.   Australian shares added 0.32 per cent to a fifth consecutive record high close, and Seoul’s KOSPI rose 0.11 per cent. Japan’s Nikkei finished up 0.45 per cent after reaching 15-month highs earlier in the session.   MSCI’s global share index touched record highs and was last up 0.05 per cent. In early European trades, pan-region Euro Stoxx 50 futures were up 0.4 per cent, German DAX futures gained 0.54 per cent and FTSE futures added 0.28 per cent. (via Reuters)

2:19 PM IST The stock of Westlife Development (Westlife), which runs the McDonald’s chain in the southern and western parts of the country, has always enjoyed premium valuation over its only listed peer — Jubilant FoodWorks (Jubilant). However, despite a higher base, the latter’s robust growth potential is likely to provide impetus to its valuation. READ MORE

LIVE UPDATES

MARKET COMMENT :: Vinod Nair, Head of Research, Geojit Financial Services

As anticipated Mid & Small caps are outpacing the broader market due to fall in economic risk and revival in business growth, this catch-up, which will be the theme of the year. Main indices are impacted by SC verdict on AGR, having an effect on Telecom & Banking sectors which are already facing NPA problem. The pre-budget rally has been very solid on a MoM basis, market may consolidate in the short-term and take cues from the actual budget and on-going results.

SECTOR WATCH | Losers and gainers on the NSE


Top gainers and losers on the S&P BSE Sensex


CLOSING BELL

The S&P BSE Sensex ended at 41,945, up 13 points or 0.03 per cent while NSE's Nifty slipped 3 points or 0.03 per cent to settle at 12,352. 

BROKERAGE RADAR | ICICI Securities on KEC International

The overall performance has been satisfactory across H1FY20 barring order inflows, which was a result of a weak domestic market. It is quite evident that previous order inflows guidance will be pruned down but the same would comfortably ensure 13.7% revenue CAGR in FY19-21E. This will be one of the best performances in our midcap capital goods universe. Also, gains in railways business margins are not factored by us. We continue to value the stock at 11.5x FY21E EPS and maintain our BUY rating (target price of Rs 335) as risk reward is favourable at this juncture.

BUZZING STOCK | Godfrey Phillips surges 4%


MARKET CHECK


BROKERAGE RADAR | HDFC Securities on Galaxy Surfactants

We reiterate our BUY rating on the stock with a TP of Rs 1,872 (22x Dec-21E) given diversified portfolio that continues to attract and retain customers, presence in widespread geographies that diversifies business risk, stability of margins (standard deviation of EBITDA margins over FY10-19 at 2.0), and ability to generate nearly 20% RoCE.

MF industry seeks LTCG easing in commodity, gold ETFs, scrapping of STT

Except for a few proposals like the one on gold and commodity ETFs, most of the changes sought by the industry have been represented in the past.
 
"We are hoping this time our long-pending submissions get addressed, which would help to take the Indian MF industry, not only to the next level of growth, but also help in contributing to making economy stronger," said N S Venkatesh, chief executive of Amfi. READ MORE

Piramal Enterprises surges 7%, hits 52-week high on divestment of DRG biz

Shares of Piramal Enterprises (PEL) rallied 7 per cent to hit 52-week high of Rs 1,656 on the National Stock Exchange (NSE), after the company announced divestment of its Decision Resource Group (DRG) business for $950 million. “PEL DRG Dutch HoldCo BV, a 100 per cent subsidiary of PEL and the holding company for Decision Resources Group (DRG) engaged in healthcare insights & analytics business, has signed a definitive agreement for the sale of DRG to Clarivate Analytics plc, a global leader in providing trusted insights and analytics, for a sale consideration of US $950 million,” the company said in a press release. READ MORE

Asian Markets check

Asian shares rose on Friday after data in China showed pressure on the world’s second biggest economy may be starting to diminish. The news along with easing trade tensions with the United States underpinned riskier assets, even as some markets took a breather in late afternoon trade.
 
MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.18 per cent in afternoon trade, trimming earlier gains of as much as 0.4 per cent. China’s blue-chip index ended 0.14 per cent higher, down from an earlier rise of as much as 0.67 oer cent.
 
Australian shares added 0.32 per cent to a fifth consecutive record high close, and Seoul’s KOSPI rose 0.11 per cent. Japan’s Nikkei finished up 0.45 per cent after reaching 15-month highs earlier in the session.
 
MSCI’s global share index touched record highs and was last up 0.05 per cent. In early European trades, pan-region Euro Stoxx 50 futures were up 0.4 per cent, German DAX futures gained 0.54 per cent and FTSE futures added 0.28 per cent.

(via Reuters)

Jubilant FoodWorks may still be a tasty bite for investors as stock gains

The stock of Westlife Development (Westlife), which runs the McDonald’s chain in the southern and western parts of the country, has always enjoyed premium valuation over its only listed peer — Jubilant FoodWorks (Jubilant). However, despite a higher base, the latter’s robust growth potential is likely to provide impetus to its valuation. READ MORE

BSE500 stocks that hit 52-week high today

COMPANY PRICE(rs) 52 WK HIGH CHG(rs) CHG(%)
ADANI ENTERP. 226.40 227.95 6.45 2.93
APOLLO HOSPITALS 1611.20 1616.75 18.70 1.17
AU SMALL FINANCE 869.00 888.00 -8.60 -0.98
AVANTI FEEDS 724.40 769.90 -21.50 -2.88
BALKRISHNA INDS 1113.60 1117.35 11.35 1.03
» More on 52 Week High

Rupee check


Dishman Carbogen falls 9% from day's high despite nod for share buyback

Shares of Dishman Carbogen Amcis were locked in 5 per cent lower circuit at Rs 84.30 on the BSE on Friday despite board approval's for a share buyback at a price not exceeding Rs 150 per share. The stock of pharmaceuticals slipped 9 per cent from its intra-day high level of Rs 92.40 on the BSE. “The board approved the buy-back of equity shares by the Company from open market through stock exchange mechanism for amount not exceeding Rs 72 crore at a price not exceeding Rs 150 per share,” Dishman Carbogen Amcis said in an exchange filing. READ MORE

Dishman Carbogen falls 9% from day's high despite nod for share buyback

Shares of Dishman Carbogen Amcis were locked in 5 per cent lower circuit at Rs 84.30 on the BSE on Friday despite board approval's for a share buyback at a price not exceeding Rs 150 per share. The stock of pharmaceuticals slipped 9 per cent from its intra-day high level of Rs 92.40 on the BSE. READ MORE

NEWS ALERT | GAIL & Power Grid are likely to move pleas before SC for clarifications in AGR case: sources to CNBC TV18

>>These PSUs are likely to prefer clarification rather than review petition
 
>> Modification pleas can be mentioned, heard by a Bench in Open Court
 
>> PSUs to seek clarification to make distinction between telcos and PSUs, and make distinction on core competencies

NEWS ALERT | Jay Shree Tea to sell stakes in 2 tea estates located in Africa: BSE filing

>> Company has entered into a definitive agreement with Grand Lacs Trading SA, Belgium to sale its stake in two of its tea estates at East Africa namely Mata & Gisakura 

>> Deal consideration:  USD 10 million to be received

>> Date of completion: 14th February, 2O2O
 

Bankrupt Jet Airways plans to sell Netherlands biz to Dutch airline KLM

The domestic full-service carrier, which shuttered operations last April, is undergoing insolvency resolution process.
 
The insolvency resolution professional managing the affairs of Jet Airways said various options are being explored for the "company's resolution and maximising the value for its stakeholders", as per the filing on Friday. READ MORE

RIL climbs 2.5% ahead of Q3 results; GRM expected to see a slight fall

Shares of Reliance Industries (RIL) climbed over 2.5 per cent in the intra-day session on Friday ahead of its December quarter (Q3FY20) results which is scheduled to be released later in the day. At 12:54 pm, the stock was trading 2.42 per cent higher at Rs 1575 apiece on the BSE. During the day, it hit a high of Rs 1577.45 levels. READ MORE

Glenmark ticks up 3%


Broader markets continue to outperform benchmarks


STOCK ALERT :: Bharti Airtel extends gain, trades over Rs 500/sh mark

>> Stock Rs 25/share away from lifetime high

>> Last record high touched on Oct 10, 2007


NEWS ALERT | Piramal Ent to sell its healthcare insights & analytics biz for $950 m to Clarivate: BSE Filing

Alert: Revenue from the healthcare insights and analytics business was Rs. 1,330.74 crores for the financial year ended March 31, 2019.



STOCK ALERT :: Ujjivan Small Finance Bank at its lowest level since listing on December 12, 2019


Nifty sectoral indices at this hour


Prestige to Sobha, south Indian developers hold the edge

The implementation of the goods and services tax, the Real Estate Regulation Act, demonetisation as well as liquidity issues, led to market share gains for organised players. Improving balance sheets and track record of executing projects have helped organised developers notch up strong volumes even as smaller players are facing a liquidity crunch and slow sales velocity. READ MORE


Emami Ltd up 5%


BUZZING STOCK:: India Glycols zooms 10%


Bharti Airtel climbs 5% on hopes of market share gain, hits 26-month high

Bharti Airtel's stock price surged 5 per cent to hit 26-month high of Rs 499 on the BSE on Friday amid expectations that the telecom company is poised for strong market share gain. The stock of the country’s largest integrated telecommunications company was trading at its highest level since November 2017. It is 6 per cent away from its all-time high level of Rs 527, touched on October 2007. READ MORE

NEWS ALERT | Adani, Azure Power winners in solar manufacturing-linked bids: Bloomberg

>> Adani to build 6 GW generation capacity, 1.5 GW manufacturing capacity in solar bids won, Renewable Energy Secy says

Q3 result preview :: Here's what brokerages expect in TCS' Oct-Dec numbers

Information technology (IT) bellwether Tata Consultancy Services (TCS) is likely to have put up a muted show in the third quarter of the 2019-20 financial year, the financial result for which it will announce today. The company witnessed higher furloughs during the December quarter than in the corresponding quarter of FY19, especially in the Banking and Financial Services (BFS) vertical. READ MORE

MARKET UPDATE:: Indices volatile, Sensex pares gains


NEWS ALERT | NCLT approves merger between Strides Chemicals & Solara Active Pharma: BSE Filing

>> Co to soon notify effective date of merger

HCL Technologies trades flat ahead of Q3 nos; here's what analysts expect

For the quarter under review, analysts at Centrum Broking expect the company to deliver 1.8 per cent constant currency (CC) revenue growth. Conversion of IBM IP revenues and capital allocation (increase in payout ratio) remains key metrics to watch in the results announcement. The brokerage further says HCL Tech is likely to retain constant currency revenue growth guidance of 15 per cent - 17 per cent for FY20E. READ MORE

BSE Midcap index hits 52-week high; Berger Paints, IGL scale record highs

The S&P BSE Mid-cap index hit a 52-week high of 15,677 points on Friday, surpassing its previous high of 15,662 hit in April 3 last year, on the back of strong rally in Adani, Tata Group, financials, pharmaceuticals and consumer discretionary goods & services stocks. READ MORE

BSE Midcap index hits 52-week high; Berger Paints, IGL scale record highs

The S&P BSE Mid-cap index hit a 52-week high of 15,677 points on Friday, surpassing its previous high of 15,662 hit in April 3 last year, on the back of strong rally in Adani, Tata Group, financials, pharmaceuticals and consumer discretionary goods & services stocks. Adani Transmission, Adani Power and Adani Enterprises from the Adani Group, while Tata Global Beverages and Tata Chemicals from the Tata Group have rallied more than 25 per cent from their respective April 3, 2019 levels. READ MORE

Stock up: Google-parent Alphabet joins $1 trillion valuation club

As Google-parent Alphabet Inc became on Thursday the fourth U.S. company to top a market value of more than $1 trillion, some funds holding its shares are wondering whether now is the time to cash in on the stock's extraordinary gains. Shares of the Internet search giant are up nearly 17% over the last three months, outpacing a broader rally in the S&P 500 index over the same period by 6 percentage points. READ MORE

NEWS ALERT | Govt open to hearing wireless carriers’ suggestions to help ease payment of $13 billion in overdue fees: Bloomberg

>> Govt may strip out interest fee or allow payment in tranches

>> Independent panel may suggest recommendations, provided companies agree to pay immediately. 

Vodafone Idea tanks 39%, banks slip up to 8% as SC rejects AGR review plea

Shares of telecom companies, including Bharti Airtel and Vodafone Idea and banking firms such as IndusInd bank and Yes Bank, were trading actively at the bourses on Friday after the Supreme Court Thursday rejected the review petitions moved by Bharti Airtel, Vodafone Idea and Tata Teleservices against its October 2019 order on payment of dues linked to adjusted gross revenue (AGR). With this, the telcos will have to together pay an estimated Rs 1.47 trillion in AGR dues that include penalties and interest on penalties by January 23. READ MORE

Rallis India soars 15%, hits 52-wk high on robust December quarter results

Shares of Rallis India soared 15 per cent to Rs 222, also its 52-week high, on the BSE on Friday, after company’s profit before tax, before exceptional items, more-than-doubled at Rs 48 crore in December quarter (Q3FY20). The Tata Group agrochemicals company had PBT of Rs 20 crore in same quarter last fiscal. The company recorded consolidated revenues of Rs 534 crore for Q3FY20, a growth of 28 per cent over previous year's quarter of Rs 417 crore. READ MORE


MARKET CHECK:: Sensex reverses losses


Most active stocks by volume

COMPANY PRICE(rs) CHG(rs) CHG(%) VOLUME
VODAFONE IDEA 4.36 -1.67 -27.69 20255742
EDELWEISS.FIN. 103.55 0.00 0.00 2529331
YES BANK 38.50 -1.45 -3.63 1745389
JAI CORP 119.05 3.05 2.63 611403
RELIANCE POWER 2.33 -0.12 -4.90 567484
» More on Most Active Volume

YES Bank dips 3% as Moody's places Co's long-term foreign currency rating under review


Nifty PSU Bank index slides 1%


Crompton Greaves up 2%


Bharti Infratel tanks 10%


Vodafone Idea extends loss, tumbles 30%


Nestle India continues uptick, gains 1%


Dishman Carbogen gains 2.6%

>> Board approves buyback for an amount not exceeding Rs 72 crore


Result Impact | Hathway cable gains

>> Q3 profit at Rs 68.2 cr versus a loss of Rs 55.8 crore, revenue rose 12.3 percent to Rs 450.8 crore YoY.


South Indian Bank trading in the green

>> Q3 profit grew 8 percent to Rs 90.5 crore, NII rose 15.8 percent to Rs 601.8 crore YoY; gross NPA up 4bps QoQ. Board approved raising Rs 500 crore via bonds.

Banks slide on huge exposure to telcos


Reliance Industries trades higher post AGR verdict, ahead of Q3 nos


Vodafone Idea tanks 10%


Bharti Airtel gains 3% post AGR verdict

>> Analysts see Airtel sailing through the situation

>> RIL, Bharti Airtel likely to be two players in the sector going forward


Sectoral trends at NSE during Opening trade


Top gainers and losers on S&P BSE Sensex during Opening trade


Market at Open


Market at Open


Top gainers and losers on S&P BSE Sensex during Pre-open


Market at Pre-open


Market at Pre-open


NEWS ALERT | DHFL 's lenders met on Thursday to deliberate on sale process of co: sources to CNBC TV18

>> Seek RBI's advice on deal structure for sale of DHFL

>> Lenders to soon vote on proposal to divide the co in 3 parts; to invite 3 separate bids

>> Retail, Wholesale, Slum Rehab project loan book of DHFL likely to be sold separately.

>> Apollo Capital, Cerberus, and Adani Group among contenders for company

>> Creditors have made claims for Rs 86,892 cr

Rupee opening

Rupee opens weaker at 70.99/$ vs Thursday's close of 70.91 against the US dollar

Small-caps set for biggest rally in nearly 10 months on rising demand

Shares in the broader market are witnessing huge buying interests and are poised for their biggest gains in nearly 10 months. In the past one month, the Nifty SmallCap 100 index has rallied 11 per cent — the most since September 2019. READ HERE

Nifty outlook and top trading ideas by Jay Anand Thakkar of Anand Rathi

NIFTY: BUY | TGT: 12,450 | SL: 12,295
 
Nifty closed well above the 12,300 levels and with that the probability of taking off the crucial hurdle of 12,400 has become quite high. The daily as well as weekly momentum indicator MACD is well in the buy mode and the hanging man candlestick pattern has been negated, hence the probability of an upside is high. READ MORE

Derivatives strategy by HDFC Securities: Buy Manappuram Finance Jan Futures

Bull Spread strategy on MANAPPURAM FINANCE
 
Buy Manappuram Finance January 185 Call at Rs 5.25 & simultaneously sell 200 call at Rs 1.25
 
Lot Size 6,000
 
Cost of the strategy Rs 4 (Rs 24,000 per strategy)
 
Maximum profit Rs 66,000 If Manappuram Finance closes at or above 200 on January expiry.
 
Break even Point Rs 189 READ MORE

Stocks that Vaishali Parekh of Prabhudas Lilladher is bullish on

BUY BIOCON
 
CMP: Rs 287.80
 
TARGET: Rs 320
 
STOP LOSS: Rs 278
 
The stock has maintained a strong base near 280 levels which is a good support level and currently has indicated a positive bullish candle pattern to imply strength and has potential to rise further in the coming days. The RSI has shown a trend reversal to signal a buy and with the chart looking attractive, we suggest to buy this stock for an upside target of Rs 320 keeping the stop loss near Rs 278. READ MORE

Commodity view by Bhavik Patel of Tradebulls Securities

Buy Copper | TGT: 462 | Stoploss: 446
 
Copper has given crossover of 20 and 50 EMA. RSI_14 is steady at 66 with no divergence and recent pull back from 453 to 446 was supported by 200 EMA. Copper is poised to test the resistance of 460 as, since August 2019, it has tested 3 times this level and fallen back. So given the historic pattern formation, we expect the current rally to atleast test till the levels of 460 and if it manages to close above that level, then the rally can get extended till 462-465. So buy at current levels for expected upmove till 462 and stoploss of 446 closing basis. READ MORE

NEWS ALERT | China's GDP grew 6% YoY in the fourth quarter of 2019: Reuters

>> Economic growth slowed to its weakest in nearly 30 years in 2019

>> Full-year growth at 6.1%, the slowest annual rate of expansion China has seen since 1990.

>> Analysts had expected it to cool from 6.6% in 2018 to 6.1%

Bulk deals on BSE as on Thursday

Bulk deals on NSE as on Thursday

FII/FPI & DII trading activity on NSE, BSE and MSEI


Rupee Check

Source: Bloomberg


Oil Check

>> At 8:32 am, Brent Crude Futures were at $64.61 per barrel-mark. 

>> WTI Crude was at $58.53 per barrel-mark.

SGX Nifty

>> At 8:27 am, the Singaporean Exchange for Nifty Futures were at 12,359.50 level, down 12 points or 0.1 per cent.

Asian Market Check

Source: Reuters


US Market Check

Source: Reuters


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