Sensex ends at fresh closing high, Nifty below 10,850; banks lead

Benchmark indices scaled new peaks on Thursday, tracking global markets, with banking stocks contributing the most to gains amid expectations that the government would increase the foreign investment limits for banks

The government is considering raising the foreign investment ceiling in private banks to 100% and in public lenders to 49%, according to media reports.
The rally in banks was also supported by the government’s decision on Wednesday to trim additional market borrowing by 60 percent for the ongoing fiscal year ending March.
Asian stocks touched record highs as well, with a rally on Wall Street supporting bullish investor sentiment. MSCI’s broadest index of Asia-Pacific shares outside Japan rose as much as 0.4%.

Meanwhile, The Goods and Services Tax (GST) Council, which will meet today, is likely to take up rationalisation of rates of about 70 items, of which at least 40 are services. Amendment in rules may also be taken up to simplify filing and plug some of the loopholes. 


Top Sectoral loser: Nifty Realty

Nifty Bank rallies 0.94% as govt may increase FDI in private banks

Sectoral Trend

Sensex top gainers and losers

Market at close

Benchmark indices ended at fresh closing highs on Thursday, tracking global markets, with banking stocks contributing the most to gains amid expectations that the government would increase the foreign investment limits for banks.
The S&P BSE Sensex ended at 35,260, up 178  points while the broader Nifty50 index settled at 10,817, up 28 points.
MCX gets Sebi's approval for deliverable futures contract in brass
MCX, the leading exchange for non-agri commodity derivatives, is for the first time in India planning futures contract in brass.
In another first for MCX, this metal contract, unlike other metals traded on the exchange, will be physical deliverable. Market regulator SEBI (Securities and Exchange Board of India) has already approved the contract's launch. Read more

Here's what GST Council may announce today after the crucial meet
A fortnight ahead of the Union Budget, the Goods and Services Tax (GST) Council is likely to take up rationalisation of rates of about 70 items, of which at least 40 are services. Amendment in rules may also be taken up to simplify filing and plug some of the loopholes. A fitment committee of officers has made these recommendations to the Council, which will meet on Thursday.
With the aim to boost struggling agriculture and rural economy, and encourage clean energy, the Council is expected to rationalise rates of agriculture implements and unconventional fuel buses. It is the last Council meeting before Finance Minister Arun Jaitley presents his last full Budget on 1 February, before general elections in 2019. Read more

Finance Minister Arun Jaitley with (R) MoS for Finance Shiv Pratap Shukla, Arvind Subramanian Chief Economic Advisor and (L)Finance Secretary Hasmukh Adhia at 25th GST Council Meeting in New Delhi | Photo: Dalip Kumar

Commodity bourse NCDEX appoints Vijay Kumar as MD & CEO for next 3 years
Leading commodity bourse NCDEX on Thursday announced the appointment of Vijay Kumar Venkataraman as the new Managing Director and CEO of the exchange for three years effective today.
He brings over 25 years of experience in leadership roles in the areas of commodity trading and merchandising along with risk management, logistics and operations, it said. Read more

UltraTech Cement, part of the Aditya Birla Group, on Thursday posted a 23% drop in third-quarter profit, hurt by rising pet coke and coal prices.

Profit fell to Rs 4.56 billion ($71.4 million) for the quarter ended Dec 31, from Rs 5.95 billion a year ago, the company said. 

Earnings Impact

Market Check
S&P BSE Sensex 35,357.89 0.79%
Nifty 50 10,855.05 0.62%
S&P BSE 200 4,776.79 -0.03%
Nifty 500 9,688.75 0.02%
S&P BSE Mid-Cap 17,653.68 -1.55%
S&P BSE Small-Cap 19,402.45 -1.45%

GIFT City wants regulatory tweaks to bring IFSC on par with global centres
Gujarat International Finance Tec-City Company Limited (Gift) said on Wednesday that a host of regulatory changes will bring India’s first international financial services centre on a par with such well-established centres in Singapore and Hong Kong.
The measures include waiving short-term capital gains tax on derivatives trade, allowing retail investors to trade and removing regulatory hurdles to make it attractive for foreign portfolio investors. Click here for full story
HDFC Bank, HDFC, ITC contribute over 50% of Sensex 400 points rally
HDFC twins – HDFC Bank and Housing Development Finance Corporation (HDFC) - and fast moving consumer goods (FMCG) giant ITC collectively contributed more than half of the Sensex 400 points rally.
The index hit a new high of 35,507 in intra-day trade today.
Besides, three stocks – ICICI Bank, Larsen & Toubro (L&T), IndusInd Bank, Maruti Suzuki India and YES Bank, these five stocks combined contributed 130 points of the total benchmark index rally.
HDFC Bank, HDFC, L&T and Hindustan Unilever are four stocks from the Sensex hit their respective all-time highs in intra-day today.

Click here for full story
Agri input firms likely to earn robust profits in Q3 ahead of rabi season
Companies making agricultural inputs are set to post better profits in the December quarter due to rising demand of seeds, agro-chemicals and fertilisers in the rabi season.
The trend is likely to continue in the second half of the financial year with both the top and bottom lines of farm input companies expected to witness robust growth. The first half of the year was affected by inventory buyback in the run-up to the imposition of the goods and services tax and delayed monsoon rainfall. Read more

Why LTCG tenure should be increased, and STCG scrapped
It’s that time of the year when we all turn children and ask for gifts from our very own Santa – the finance minister. Demands for increase in basic exemption limit, tax-saving investment limit and interest deduction for self-occupied house’s limit are the perennial favourite toys sought by us.
This year, ahead of Budget 2018, the demands are shriller, since it is the last full Budget before the elections in 2019. And, Finance Minister Arun Jaitley is expected to provide gifts. Read more
Mindtree soars 11% on strong Q3 results
Mindtree hit a 52-week high of Rs 694, up 11% on the National Stock Exchange (NSE) in intra-day trade, after the compared reported a better than expected 13.4% quarter on quarter (q-o-q) growth in net profit at Rs 1.41 billion for December quarter (Q3FY18). The information technology services company had profit of Rs 1.03 billion in previous quarter.
Operational revenue grew 3.4% q-o-q at Rs 13.78 billion against Rs 13.32 billion in September quarter. In dollar terms, Mindtree’s revenue grew 3.9% q-o-q at $ 214.3 million. READ MORE
Sectoral Trend

Bharti Infratel down 5% as Q3 profit misses estimates
Bharti Infratel has dipped 5% to Rs 349 on BSE in intra-day trade after the company reported 6% decline in consolidated net profit at Rs 5.85 billon in December quarter.
The telecom services provider had profit of Rs 6.20 billion in the same quarter previous fiscal.
Revenue grew 7% at Rs 36.55 billion against Rs 34.01 billion in the corresponding quarter of previous year. READ MORE
Return of the big boys: Why large-cap stocks might be the best bet for 2018
Investors aligning their investments to indices would be better placed betting on large-caps in 2018, it would seem.
After four years of underperformance, the blue chip-focused Sensex and Nifty are expected to fare better than the small-cap and mid-cap indices, going by forecasts of brokerages. According to Bloomberg consensus data, analysts are predicting an average 8% upside to Sensex companies, compared to 3-4% expected on the BSE mid-cap and small-cap indices. Read more
Panacea Biotec surges 10% on collaboration with Serum Institute of India
Panacea Biotec surged 10% to Rs 284 on BSE in intra-day trade after the company announced the collaboration with signing of two long term agreements with Serum Institute of India(SII) and SII's wholly owned subsidiary, Bilthovan Biologicals BV (BBIO).
Under the collaboration, SII is entitled to manufacture & sell fully liquid Whole cell Pertussis (wP) and Salk based Injectable Polio Vaccine (IPV) based Hexavalent vaccine (DTwP-HepB-Hib-IPV) developed & commercialized by Panacea Biotec, a first of its kind in this category. Read more

Market Check
S&P BSE Sensex 35,426.69 0.98%
Nifty 50 10,860.30 0.67%
S&P BSE 200 4,797.68 0.41%
Nifty 500 9,720.50 0.35%
S&P BSE Mid-Cap 17,849.93 -0.46%
S&P BSE Small-Cap 19,683.47 -0.02%

Investing in small-caps? Direct investors should beware of valuation risks
Last week the BSE Small-cap Index touched a new high, crossing the 20,000 mark. Over the past year, small-cap stocks have rallied strongly, with this index giving a return of 53.22 per cent.
However, valuations within this space have now risen to exorbitant levels. The Nifty Free Float Small-cap 100 Index is currently trading at a 12-month trailing price-to-earnings (P/E) ratio of 199.1, according to Bloomberg — almost four times the 10-year average P/E of 51.8. Read more
Did the Bitcoin burst? How it compares to history's most famous bubbles
Bitcoin’s recent wobbles have given fresh urgency to a question that’s gripped market observers for much of the past year: Will the cryptocurrency go down as one of history’s most infamous bubbles, alongside tulipmania and the dot-com craze?
The magnitude of Bitcoin’s boom (before it lost as much as 48% from its Dec 18 high) suggests investors have reason to be worried. Read more

Amid growing competition, Eicher may disappoint on growth expectations
The Eicher Motors stock has shed nine per cent over the past month, and about 14 per cent since November, on worries that greater competition will eat into the company’s lucrative market. Further, when the falling order is falling and new models have not gained significant success, the company may not meet the Street’s expectations on growth in volumes. It is no surprise then that some brokerages have downgraded the stock. 
In fact, analysts at IIFL Institutional Equities have turned negative on the scrip. They highlight that Royal Enfield’s (RE’s) falling order book indicates weak order flows, declining benefits from network expansion, and lack of success of new models. These trends are much in contrast to the strong order book and near monopoly situation Eicher had not long ago. READ MORE
HDFC Bank market cap crosses Rs 5-trillion mark first time
HDFC Bank saw its market capitalisation (market-cap) crossing Rs 5-trillion after the share price of the bank hit a new high on Thursday. The country’s private sector lender becoming the third firm after Reliance Industries (RIL) and Tata Consultancy Services (TCS) to achieve this milestone.
In past four trading sessions, HDFC Bank has outperformed the market by gaining 4% after its parent company Housing Development Finance Corporation’s (HDFC) board approved fund raising worth Rs 130 billion through a combination of a preferential allotment and Qualified Institutions Placement (QIP).

HDFC Bank branch office in Mumbai

HDFC Securities sees Nifty going past 11.5k in FY19, sets 11,800 target
Expecting an earnings growth of 21.5 per cent next fiscal, domestic stock brokerage HDFC Securities has set the Nifty target at 11,800 for fiscal 2019.
The domestic stock brokerage expects Nifty earnings to grow by 13.5 per cent this fiscal year from 10.4 per cent a year-ago. Click here for full story
Sensex hits 35,000, gains 1,000-point rally in 16 sessions
It has taken a mere 16 trading sessions for the Sensex to move from 34,000 to 35,000. HDFC, Infosys, TCS and ICICI Bank have contributed nearly 700 points to the latest 1,000-point gain.
So far this fiscal year, FPIs have pumped in over Rs 20 billion into domestic stocks, helping the benchmark index climb 3%. Last year, the Sensex had gained 28% amid huge inflows from equity mutual funds. Following the sharp gains, the 30-share Sensex now trades at 19 times its one-year forward estimated earnings, much higher than its long-term average of 16 times. Read more
Banks extend rally; HDFC Bank at new high, ICICI Bank nears record high
Banking shares extend rally for the second straight day, with the Nifty Bank hit a new high of 26,888 on the National Stock Exchange (NSE) in intra-day trade on Thursday after a strong gain in private sector as well as public sector banks (PSBs).
At 09:38 am; Nifty Bank index, the largest gainer among sectoral indices, was up 2% at 26,805 as compared to the benchmark Nifty 50 index. Nifty PSU Bank and Nifty Private Bank index were up 1.4% and 1.9%, respectively. Click here for full story

Adani Transmission hits record high post Q3 results
Adani Transmission hit a record high of Rs 252, up 9% on BSE in early morning trade after the company reported profit after tax (PAT) of Rs 1.55 billion for the quarter ended December 2017 (Q3FY18).
“On a comparable basis excluding recovery of arrears PAT for the Q3FY18 has increased to Rs 1.55 billion against Rs 999 million of Q3FY17,” Adani Transmission said in a press release. Read more
Sensex tops 35,000-mark: Here's what market players are saying
BSE Sensex breached the 35,000 mark for the first time on Wednesday, as banks rallied after the government decided to cut its additional market borrowing requirement by 60% for the current fiscal year.
The BSE Sensex was up 0.89% at 35,081.82, while the broader NSE Nifty ended 0.82% higher at 10,788.55. Both indexes posted record closing highs. Click here to know what market players are saying

RIL results preview: GRM to decline, petchem biz to drive profitability
Oil-to-telecom conglomerate Reliance Industries (RIL) is expected to report a sequential decline in gross refining margins (GRM), while still maintaining it in double digit. The market is watching out for the telecom division’s performance which surprised the street with an operating profit in the previous quarter.
In a Bloomberg poll, nine analysts estimated the company’s consolidated profit at Rs 84.96 billion against Rs 81.09 billion and seven analysts estimated revenue of Rs1.02 trillion against revenue of Rs 914.81 billion reported in the same quarter a year back. At a standalone level, nine analysts expect revenue at Rs 851.11 billion and 10 analysts expects net income at Rs 85.46 billion. Read more

Nifty Bank rises as Govt cuts extra loans to Rs 200 bn

Sectoral Trend

Top Sensex gainers and losers

Broader Markets

Broader markets were in line with the benchmark indices with BSE Midcap and BSE Smallcap indices up 0.7% and 0.6% respectively
Markets at open

Benchmark indices are likely to open positive following Asian stocks, that were near record highs on Thursday. At 9:17 am the S&P BSE Sensex was trading at 34,345 up 263 points while the broader Nifty50 was ruling at 10,854 up 65 points
21 companies to report results today
As many as 21 companies are likely to report their Q3 numbers today including Adani Enterprises, Adani Ports, Bharti Airtel, DB Corp, Mastek, Yes Bank, and UltraTech Cement.
Newgen Software's Rs 4.25-billion IPO gets 70% subscription on Day 2
The initial public offer of IT firm Newgen Software Technologies was subscribed 70 per cent on the second day of its listing today.
The IPO, which aims to raise Rs 4.25 billion, received bids for 85.54 lakh shares against the total issue size of over 12.2 million scrips, registering a subscription of 70 per cent, data available with the National Stock Exchange (NSE) showed.
The portion reserved for retail investors was subscribed 1.33 times, while that for qualified institutional buyers (QIBs) witnessed a subscription of 10 per cent. READ MORE
Amber Enterprises Rs 6-bn IPO fully subscribed on first day of bidding
Amber Enterprises' Rs 6 billion initial public offering was fully subscribed on the first day of its bidding on Wednesday.
The IPO received bids for 5.09 million shares against the total issue size of 4.92 million scrips, registering a subscription of 1.03 times, data available with the National Stock Exchange (NSE) showed.
The company had raised Rs 1.79 billion from anchor investors yesterday. READ MORE
Bitcoin slumps below $10,000
Bitcoin skidded below $10,000 on Wednesday, halving in value from its peak price, with investors gripped by fears regulators could clamp down on the volatile cryptocurrency that sky-rocketed last year.
Centre mulls permitting 100% foreign investment in private banks
The Union government is holding talks to increase foreign investment limits in private sector banks to 100%, from 74% at present. It is also considering a hike in the foreign investment cap for public sector banks (PSBs), from 20% to 49%, a top government official said.
“The finance ministry has suggested it (hiking foreign direct investment ceiling). We are formulating a response.
According to the government’s policy, foreign investors — foreign direct investment, foreign institutional investors, and non-resident Indians combined — can invest up to 74% of paid-up capital in private sector banks. Up to 49% foreign investment is allowed under the automatic route; such investments between 49 and 74% require the government’s nod under the present norms. READ MORE
Govt cuts extra loans to Rs 200 bn, FY18 fiscal deficit could reach 3.4%
The government has announced that it is reducing additional borrowing to Rs 200.00 billion from Rs 500.00 billion earlier, in the current financial year (FY18), signalling to markets and experts about the Centre’s commitment to fiscal consolidation.
But even then, the fiscal deficit may reach up to 3.4% of gross domestic product (GDP), higher than the 3.2% pegged in the Budget for 2017-18.
This reduction in borrowing largely came because the government expects the Reserve Bank of India (RBI) to transfer to it a higher-than-anticipated surplus in FY18, a few senior government sources have confirmed independently to Business Standard. READ MORE
Direct tax mop-up jumps 19% this fiscal
Direct tax collections during the first nine-and-a-half months of the current fiscal have risen by 18.7% to Rs 6.89 lakh crore, the tax department said on Wednesday.
The collections till January 15, 2018 represent over 70% of the Rs 9.8 lakh crore revenue target from direct taxes, the Central Board of Direct Taxes (CBDT) said in a statement.
SGX Nifty
Trends on SGX Nifty indicate a positive opening for the broader index in India, a rise of 34.50 points or 0.32%.
Asia stocks near record highs
Asian stocks were near record highs on Thursday, with a rally by Wall Street supporting bullish investor sentiment, while the dollar pulled back from three-year lows as the euro’s recent rally lost steam.
MSCI’s broadest index of Asia-Pacific shares outside Japan was 0.16% higher at 595.53, near the previous day’s record high of 595.80.
Australian stocks rose 0.2%, South Korea's KOSPI added 0.6% and Japan's Nikkei climbed 0.9% to reach its highest level since late 1991.
US markets end higher on earnings optimism
US stocks jumped on Wednesday and the Dow closed above 26,000 for the first time as investors’ expectations for higher earnings lifted stocks across sectors.
The Dow Jones Industrial Average rose 322.79 points, or 1.25%, to 26,115.65, the S&P 500 gained 26.14 points, or 0.94%, to 2,802.56 and the Nasdaq Composite added 74.59 points, or 1.03%, to 7,298.28.
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