MARKET WRAP: Sensex ends 373 pts up as rupee recovers; PM eco meet eyed

The equity markets settled 1 per cent higher on Friday as the rupee recovered against the dollar.

The S&P BSE Sensex reclaimed the 38,000 mark to end at 38,091, up 373 points while the broader Nifty50 index settled at 11,515, up 145 points.

In the broader markets, the S&P BSE MidCap settled 1.6 per cent higher and the S&P BSE SmallCap rose 1.4 per cent.

Among sectoral indices, the Nifty Pharma index settled 2.5 per cent higher led by a rise in the share prices of Divi's Laboratories and Piramal Enterprises. On the other hand, the Nifty Bank index rose 1.3 per cent led by YES Bank and IDFC Bank.

Rupee recovers

The rupee strengthened by over 60 paise to 71.58 against the US dollar in intra-day trade. On Wednesday, the domestic currency rebounded from its historic low of 72.91 to end higher by 51 paise at 72.18 against the dollar.

This apart, Prime Minister Narendra Modi will hold a meeting with finance ministry officials later in the day to discuss the fall in the rupee and other economic issues. Rupee is Asia's weakest currency in 2018, down more than 12 percent on a widening current account deficit and higher oil prices.

Macroeconomic data

Investors cheered as the industrial production grew at 6.6 per cent in July on the back of good performance by the manufacturing sector and higher offtake of capital goods and consumer durables.

Meanwhile, CPI inflation dipped 3.69 per cent in August 2018, compared to 4.17 per cent in July 2018. The core CPI inflation declined to 5.90 per cent in August 2018 compared with 6.29 per cent in July 2018.

Inflation based on wholesale prices eased to a four-month low of 4.53 per cent in August on softening of prices of food articles, especially vegetables. The Wholesale Price Index (WPI) based inflation stood at 5.09 per cent in July and 3.24 per cent in August last year.

Global Markets

Asian shares rose on Friday as the United States and China looked set to launch a new round of trade talks amid an escalating tariff row, while a decisive interest rate hike by Turkey's central bank also helped support global risk appetite.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 1.2 per cent, putting it on track for its best performance in more than two weeks.

Seoul's Kospi was up 1.4 per cent higher and Hong Kong's Hang Seng climbed 0.9 per cent. Japan's Nikkei stock index ended 1.2 per cent higher.

(with wire inputs)

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Nifty Pharma index ends 2.51% higher. Top gainers:

KIOCL 226.50 188.75 37.75 20.00
DEN NETWORKS 59.60 49.70 9.90 19.92
BAJAJ HINDUSTHAN 8.50 7.15 1.35 18.88
SH.RENUKA SUGAR 14.80 12.90 1.90 14.73
BALRAMPUR CHINI 88.65 78.00 10.65 13.65

Nifty sectoral gainers and losers of the day

BSE Sensex: Vedanta, Power Grid, Asian Paints among top gainers of the day

Market at close

The S&P BSE Sensex reclaimed the crucial 38,000 level to settle at 38,091, up 373 points or 1 per cent while NSE's Nifty50 index ended 145 points or 1.28 per cent higher at 11,515. 
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It has been 10 years since Lehman Brothers collapsed. This watershed event had an impact on financial markets and economies around the globe. In India, the benchmark Sensex shed a staggering 52.48 per cent during the calendar year 2008. Liquidity dried up within the debt market, while the real estate industry was hamstrung by lack of funding. Job losses and salary cuts led to demand contraction. A decade later, investors need to imbibe the lessons from that black swan event so that if another one of a similar magnitude strikes, they are better prepared to handle it. READ MORE
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10 years of Lehman collapse: What has changed since, and what has not

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India's fuel demand rose 0.8% year on year in August

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An employee stands next to a pump at a fuel station in New Delhi | Photo: Reuters

India-focused investors' fundraising in Jan-Aug sees 109% annual growth

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Ten years on, why the country is unlikely to revisit the Lehman crisis

On September 15, 2008, fear ruled the street. The collapse of Lehman Brothers had left the financial system tottering. In the 25 years I have spent in the banking industry, I had never seen any other international event having such a huge impact on India. Talks of job losses were rife, and many jobs were actually lost. READ MORE

Market Check

Index Current Pt. Change % Change
S&P BSE SENSEX 38,032.05 +314.09 +0.83
S&P BSE SENSEX 50 12,017.70 +117.07 +0.98
S&P BSE SENSEX Next 50 34,536.46 +629.51 +1.86
S&P BSE 100 11,781.88 +129.90 +1.11
S&P BSE Bharat 22 Index 3,641.11 +45.92 +1.28

(Source: BSE)
Meet the decision makers who steered India through the Lehman crisis

Palaniappan Chidambaram has been acknowledged by D Subbarao to have pushed the latter’s candidature as Reserve Bank of India (RBI) governor in September 2008. But his term ended perhaps with less warmth than it started.
The beginning of a frosty relationship between the two can be traced back to the financial crisis when Chidambaram constituted a liquidity management committee and asked the central bank to nominate a representative. READ MORE

10 years of Lehman crisis: India Inc's global foray has been a mixed bag

In 2006, just two years before the Lehman crisis had hit the global financial markets, two top Indian business houses — Tata and Aditya Birla — made headlines by acquiring large companies abroad. The acquisition of Novelis by Birla’s Hindalco for $6 billion and the buyout of Corus Steel by Tata Steel for $12.3 billion gave massive confidence boost to India Inc. READ MORE

NEWS ALERT PMO's economic review meeting at 6:30 pm today

Top gainers in BSE 500:

BALRAMPUR CHINI 87.70 9.85 12.65
R C F 74.05 6.30 9.30
JINDAL STAIN .HI 151.50 11.20 7.98
GRANULES INDIA 115.95 8.25 7.66
M & M FIN. SERV. 453.75 28.20 6.63
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August WPI inflation at 4.53% vs 5.09% in July
Markets at noon

Index Current Pt. Change % Change
S&P BSE SENSEX 37,895.16 +177.20 +0.47
S&P BSE SENSEX 50 11,973.07 +72.44 +0.61
S&P BSE SENSEX Next 50 34,394.39 +487.44 +1.44
S&P BSE 100 11,737.39 +85.41 +0.73
S&P BSE Bharat 22 Index 3,621.64 +26.45 +0.74

Take SIP route to mid and small-cap funds; avoid lump sum investments
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COMMENT Goldman Sachs on economic data

We expect the moderation in inflation to be temporary, and forecast headline inflation to rise to the upper end of RBI’s inflation target band by late 2018. We expect the RBI to remain on hold for the rest of FY19 given incomplete transmission of past RBI rate hikes by banks. Beyond that, we forecast RBI to hike in each of the following three quarters (total of 75bps).

That said, risks are tilted towards earlier rate hikes after the sharp fall in INR and its expected pass-through to inflation. Our FY19 headline inflation forecast is now 5.3%yoy (from 5.5% earlier) with the recent softening in inflation, but this is still above consensus expectation of 4.9%.
Jefferies on IT sector

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ICICI Securities on NMDC

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IPO WATCH ICICI Securities on Ircon

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William Poole

Investors remain bearish on gold ETFs, pull out Rs 450 mn in August
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Market Check

Index Current Pt. Change % Change
S&P BSE SENSEX 37,926.54 +208.58 +0.55
S&P BSE SENSEX 50 11,976.86 +76.23 +0.64
S&P BSE SENSEX Next 50 34,299.62 +392.67 +1.16
S&P BSE 100 11,735.66 +83.68 +0.72
S&P BSE Bharat 22 Index 3,630.92 +35.73 +0.99

MUST READ PSUs cut dividend 2nd time in a decade as cash reserves continue to dwindle
The combined dividend payout by public sector undertakings (PSUs), excluding banks and financials, declined nearly 10 per cent in 2017-18. This was the first time since 2014-15 — and only the second instance in a decade — when the dividend kitty shrank over the previous fiscal year.
The cut in equity dividends paid by PSUs was despite the improvement in their profitability, especially for oil companies and metal producers. READ MORE


Govt hikes procurement price of ethanol; sugar stocks gain

MAGADH SUGAR       95.00 89.00 6.00 6.74  
RANA SUGARS 3.63 3.50 0.13 3.71  
SAKTHI SUGARS 15.40 14.89 0.51 3.43  
DWARIKESH SUGAR 21.30 20.60 0.70 3.40  
TRIVEN.ENGG.IND. 43.45 42.55 0.90 2.12

Cabinet okays Rs 15,053 crore new procurement policy to assure MSP to farmers; Fertilizer stocks gain

R C F   78.50 67.75 10.75 15.87  
COROMANDEL INTER 406.00 396.80 9.20 2.32  
G N F C 403.90 395.35 8.55 2.16  
S P I C 29.65 29.55 0.10 0.34  
NAGARJUNA FERT. 12.35 12.32 0.03 0.24

Nifty sectoral trend

BSE Sensex opening gainers and losers

Markets at open
The S&P BSE Sensex reclaimed 38,000 mark. At 9:15 AM, it was trading at 38,051, up 333 points while the broader Nifty50 was ruling at 11,480, up 110 points.
Top trading idea by Prabhudas Lilladher
CMP: Rs 224.40       
TARGET: Rs 248     
The stock has been in an upward trending mode in the daily chart forming a higher bottom pattern at regular intervals and currently has indicated a bullish candle to signify strength and has potential to carry on the momentum still further upward to give a breakout above the significant 200DMA moving average and has maintained a positive bias. With the indicators looking favourable and with good volume participation witnessed, we recommend a buy in this stock for an upside target of 248 keeping a stop loss of 210.
Markets at pre-open

Index Current Pt. Change % Change
S&P BSE SENSEX 37,889.43 +171.47 +0.45
S&P BSE SENSEX 50 11,965.31 +64.68 +0.54
S&P BSE SENSEX Next 50 34,023.68 +116.73 +0.34
S&P BSE 100 11,711.82 +59.84 +0.51
S&P BSE Bharat 22 Index 3,611.20 +16.01 +0.45


Rupee opens firm at at Rs 71.73
Nifty outlook by Prabhudas Lilladher

Nifty after correcting from 11,750 levels to a low of 11,250, which is a prominent support, Nifty has bounced with rupee also retracing has given an impetus for a boost, however, this would be still considered as a bounce as indicators do not confirm any signs of reversal. The support for the day is seen at 37,460/11,300 while resistance is seen at 37,980/11,440. Bank Nifty would have a range of 26,550-27,100. Pharma stocks along with Metals look promising from here on.
IIP, retail inflation ease
Industrial production grew at 6.6 per cent in July on the back of good performance by the manufacturing sector and higher offtake of capital goods and consumer durables. Retail inflation cooled to an 11-month low of 3.69 per cent in August mainly due to a fall in prices of kitchen items, including fruits and vegetables, official data showed Wednesday.
Rupee stages sharp comeback
The rupee Wednesday rebounded from the historic low of 72.91 to end higher by 51 paise at 72.18 against the dollar after the finance ministry assured of steps to avert its fall to "unreasonable levels".
Nifty futures on SGX trades higher
The Nifty futures on SGX were trading 42.50 points or 0.37 per cent higher at 11,487.50. 
Asian stocks extend rally
Asian stocks extended a rally after their recent battering drove valuations to a two-year low, following a technology-supported advance in US equities. Japan’s Topix rose 1 per cent while Hong Kong's Hang Seng gained 0.2 per cent. The MSCI Emerging Market Index gained 0.4 per cent, adding to Thursday’s 1.3 per cent advance and China's Shanghai Composite slid 0.1 per cent. 
US stocks end higher
Apple led a rebound in technology shares and boosted all three major US stock indexes on Thursday, while trade worries eased after China said it was open to fresh talks with the United States. The Dow Jones Industrial Average advanced 147.07 points, or 0.6 per cent, to end at 26,145.99. The S&P 500, rose 15.26 points, or 0.5 per cent, to 2,904.18 and the Nasdaq Composite Index climbed 59.48 points, or 0.8 per cent to finish at 8,013.71.
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