After surging 500 points in the intra-day trade, the S&P BSE Sensex witnessed a sharp fall at the fag-end of the session, mainly due to profit-booking to end at 38,024, up 269 points or 0.71 per cent. Financial stocks such as HDFC Bank and ICICI Bank contributed the most to the index's gains while Reliance Industries (RIL), ITC and Hindustan Unilever (HUL) emerged as the biggest drags.
The NSE's benchmark index Nifty50 closed above 11,400 level at 11,427, up 84 points or 0.74 per cent. The index hit a high of 11,487 levels during the day.
Both Sensex and Nifty reclaimed their crucial levels of 38,000 and 11,400 levels, respectively in the intra-day trade after a gap of six months.
On a weekly basis, Sensex gained 3.68 per cent and Nifty added 3.54 per cent.
Market breadth remained in favour of declines as out 2,860 companies traded on BSE, 1,478 declined and 1,207 advanced while 175 remained unchanged. A total of 59 securities hit their 52-week highs while 111 scrips hit their one-year lows.
In the broader market, the S&P BSE MidCap index ended 83 points, or 0.55 per cent higher at 15,172, while the S&P BSE SmallCap index settled at 14,837, down 51 points or 0.34 per cent.
Banking barometer Nifty Bank, too hit a fresh record high of 29,520.70 during the day. It ended at 29,381.45, up over 1.50 per cent with 10 out of 12 constituents ending in the green.
Shares of Titan Company hit a new high of Rs 1,112, up 2.5 per cent, in intra-day trade. The firm is set to join the elite club of Rs 1-trillion market capitalization (market-cap) on the BSE. The stock, eventually settled at Rs 1,095 apiece on BSE, up nearly a per cent.
Shares of UPL hit a new high of Rs 921, up 2 per cent, in intra-day trade, after more than two million shares of the agrochemicals company changed hands on the BSE through block deal. It settled at Rs 922, up 2 per cent.
Among sectoral indices, Nifty PSU Bank index added nearly 2 per cent, as Bank of Baroda and Punjab National Bank edged higher. The Nifty Private Bank index moved up 1.59 per cent.
Asian stocks advanced on Friday as sentiment improved on a report that U.S.-China trade talks were making progress and after UK lawmakers voted to delay a potentially chaotic exit from the European Union.
MSCI broadest index of Asia-Pacific shares outside Japan gained 0.55 per cent. The Shanghai Composite Index added 0.7 per cent and Japan’s Nikkei climbed 0.8 per cent.
The S&P BSE Sensex gained 269 points or 0.71 per cent to settle at 38,024 while NSE's Nifty50 index ended at 11,427, up 83.5 points or 0.74 per cent.
Reliance Infrastructure surges almost 7%
Sectoral trends on NSE
Private banks, Reliance Industries help Sensex past 38,000 mark
Banking shares, mainly of private lenders, along with Reliance Industries (RIL), have helped the benchmark S&P BSE Sensex reclaim the crucial 38,000 levels after six months. The S&P BSE Sensex hit 38,146 on Friday in intra-day trade, its highest level since September 14, 2018, on back of strong buying by the foreign portfolio investors (FPIs). READ MORE
Commodity outlook: Edible oil down but not out
Edible oil prices have been declining due to rising stocks and poor demand. Rising output in India, the largest consumer, has added to the weak sentiment. Accordingly, domestic crude-palm-oil prices also declined, by around 8 percent. READ MORE
Expect 25 bps cut in April: Kotak Securities
February CPI and WPI inflation firmed to 2.57% and 2.93% primarily on account of some reversal in food inflation. The readings, however, remain benign and would provide comfort to the MPC to cut repo rate by 25 bps to 6% in April. CPI inflation has been within the RBI’s target of 4% for the past seven months and is likely to remain so in the near term given the muted inflation-growth dynamics. If inflation expectations continue to fall and with some opening up of the output gap, we do not rule out further rate cuts given our expectations of sub-4% inflation till October 2019. Upside risks to inflation could emanate from volatility in food and fuel prices, monsoons, fiscal slippages, and elevated and sticky core inflation.
Motilal Oswal Financial Services on LIC Housing Finance
At CMP, the stock trades at 1.4x FY20 BVPS – this is close to its decadal low of 1.1x. With steady-to-improving core home loan growth, stable spread and asset quality, LICHF is set to deliver 1.5%/16% RoA/RoE over the medium term. Key risks stem from the increasing GNPL ratio of the retail loan book. Maintain BUY with a target price of Rs 600 (1.5x Dec 2020E BVPS).
SECTOR WATCH | NGT order, focus on affordable housing to aid home decor players
Recent ruling by the National Green Tribunal (NGT), Delhi bench to shut down all ceramic units at Morbi and Wankaner in Gujarat that run on coal gasifier is a positive development for organised home decor players, analysts say. READ MORE
Heatmap: S&P BSE Sensex
NEWS ALERT :: L&T approves MindTree acquisition: TV reports
Chinese cuisine brand Hong's Kitchen foray adds spice to Jubilant's menu
After a good set of numbers for the December 2018 quarter, the stock of Jubilant FoodWorks (JFL) felt some pressure due to the promoter’s proposal for royalty payments. The stock recovered after the proposal was withdrawn. READ MORE
UPL hits new high, rises 2% to Rs 251 after block deals
Shares of UPL hit a new high of Rs 921, up 2 per cent, in intra-day trade on Friday, after more than two million shares of the agrochemicals company changed hands on the BSE through block deal. At 09:19 am, around 2.41 million equity shares, representing 0.52 per cent of total equity of UPL, changed hands on the BSE, exchange data showed. READ MORE
Latest FDA action is a 'sentimentally negative outcome' for Lupin
Lupin received yet another regulatory setback after the inspection of its Mandideep manufacturing facility (Unit 1) in Madhya Pradesh by the United States Federal Drug Administration (USFDA). The unit, which was classified as OAI or Official Action Indicated, may see an escalation of issues and difficulties in receiving approvals for new drug launches from there. READ MORE
At CMP, the stock trades at 1.4x FY20 BVPS – this is close to its decadal low of 1.1x. With steady-to-improving core home loan growth, stable spread and asset quality, LICHF is set to deliver 1.5%/16% RoA/RoE over the medium term. Key risks stem from the increasing GNPL ratio of the retail loan book. Maintain BUY
with a target price of Rs 600 (1.5x Dec 2020E BVPS).
Edelweiss on Nestle
Our conviction on Nestle strengthening its volume-led revenue growth remains strong amid acceleration of broader market momentum. This was also evident in our recent interaction with the company’s MD and Chairman Mr. Suresh Narayanan. Volume growth of 11.1% in CY18 (highest in past seven years, ex-CY16, aided by Maggi’s comeback) reflects Nestle’s strengthening positioning in existing brands, deepening penetration and its quest for innovations.
We are enthused by the 370bps YoY increase in ad spend in Q4CY18 versus mere 50bps in H1CY18 (as highlighted in our earlier report, Innovations thriving; ad spends need to perk up). We remain enthused with Nestle’s innovation and success rate coupled with potential to harness growth through cluster-based approach. Hence, maintain ‘BUY’.
A2Z Infra hits the roof after one-time debt settlement
A2Z Infra Engineering hit an upper circuit limit of 5% at Rs 18.05 at 11:48 IST on BSE after the company said it signed full cash one time debt settlement agreement with Edelweiss Asset Reconstruction Company. READ MORE
Inter-group transactions, debts once again weigh on Adani Ports stock
Adani Ports and Special Economic Zone (Adani Ports) is among the most sold stock by domestic investors in February 2019, according to the recent data. For analysts who were always wary of the company’s debt levels, inter-group loans and advances, and shareholding pledged by its promoters, these concerns once again resurface with the Adani Agri Logistics’ (AAL) acquisition. READ MORE
Sectoral trends on NSE
STOCK ALERT :: Nifty PSU Bank at 2-month high; PNB hits 6-month high on rating upgrades
Shares of public sector undertaking (PSU) banks were continued their northward journey with Nifty PSU Bank index hitting two-month high on expectation of improve financial performance.
At 11:15 am, Nifty PSU Bank index, the largest gainer among sectoral indices, was up 2.2 per cent, as compared to a 0.64 per cent gain in the benchmark Nifty50 index. Nifty Bank and Nifty Private Bank indices were up 1 per cent each. READ MORE HERE
INTERVIEW :: NBFC sector to see massive consolidation ahead: Pankaj Murarka
The IL&FS default and the consequent liquidity squeeze has been a perfect storm for the shadow banking sector in India. Though the liquidity squeeze has abated to an extent, this event marks a structural change for the sector going forward, says Pankaj Murarka, Fund Manager and Founder of Renaissance Investment Managers, in an interaction with Swati Verma CLICK HERE FOR MORE
Lok Sabha polls: Here's a snapshot of how markets have behaved since 2004
The markets tend to be volatile before and after the general election. With the polling dates for the 2019 elections announced, here’s a snapshot on how the markets have behaved since 2004 CLICK HERE FOR THE GRAPHIC
Crisis deepens as Jet Airways stares at another default of $109 million
Jet Airways could be staring at another default of $109 million, which it has to pay by March 28 to the HSBC Bank Middle East as the second tranche of the $140-million loan it had taken in 2014 and for which the Abu Dhabi-headquartered airline stood guarantor. Jet had, on March 11, defaulted on its external commercial borrowings of $31 million, payable to HSBC and guaranteed by Etihad Airways, which owns 24 per cent in Jet READ MORE HERE
Zee Entertainment jumps over 2.5% on stake sale report
CG Power extends gain; stock zooms 106% from 52-week low
Shares of CG Power and Industrial Solutions were up 6 per cent to Rs 44.75 in intra-day trade on the BSE, extending its month-long gain, on report that KKR, Yes Bank and BOI AXA may take control of Avantha Group Company. The stock has zoomed 109 per cent from its 52-week low of Rs 21.40 touched February 14 on the BSE in intra-day trade. READ MORE
Recall Rs 2,300 crore-loan from Singh brothers, others: Sebi to Religare
Sebi Thursday ordered Religare Finvest and Religare Enterprises to recall loans worth over Rs 2,300 crore that were diverted to promoters Shivinder Mohan Singh, Malvinder Mohan Singh and 21 other entities after finding preliminary evidence of fund diversions. READ MORE
WEB EXCLUSIVE :: Embassy Office Parks REIT IPO: Should you invest?
Bengaluru-based Embassy Property Developments Pvt Ltd, plans to raise Rs 4,750 crore from initial public offering (IPO) that opens on Monday, March 18. The price band for the Embassy Office Parks REIT IPO is Rs 299-300 apiece. The interest range for the issue could also widen to 9.5 – 9.75 per cent as the final pricing is yet to be fixed, reports suggest. The trust’s portfolio comprises about 33 million square feet of office space across four Indian cities, Bengaluru, Pune, Mumbai and Noida, reports suggest. READ MORE
Canara Bank is trading almost 1.80% higher
Titan Company set to join Rs 1-trillion market cap club; hits new high
Shares of Titan Company hit a new high of Rs 1,112, up 2.5 per cent, in intra-day trade even as the firm is set to join the elite club of Rs 1-trillion market capitalization (market-cap) on the BSE. The stock surpassed its previous high of Rs 1,096 touched on Tuesday, March 12, 2019. READ MORE
Axis on HCL Tech
HCL Tech announced acquisition of Strong-Bridge Envision (SBE), a US-based digital transformation consulting firm. Based on CY18 revenue of $45.6 mn, the acquisition has been valued at 1x sales with all cash consideration of $45 mn ($42 mn + $3 mn earn-out linked to target). The acquisition is likely to be completed by April 2019.
The company continues on accelerated journey of inorganic strategy that may raise concern on integration challenges. However, we are more positive on Mode 2 related acquisition by the company compared to Mode 3. We believe pedestrian valuation restrict downside risk. However, we see an integration risk as key concern. Retain HOLD.
HDFC Securities on Gujarat State Petronet
We value GSPL’s transmission business using Discounted Cash Flow (DCF) at Rs 120/sh. To this, we add Rs 87/sh as value of its investments in GGL, Sabarmati Gas (30% discount to EV/EBTDA valuation) and other investments (at book value) to arrive at the target price of Rs 207/share. We initiate with BUY.
Jefferies on NATCO
NATCO has corrected 30% in 6m led by lower Copaxone profits and concerns on near-term earnings. At the current price it is trading at 22x FY20e EPS ex US and no value to US pipeline ex Revlimid. US, while there are a lack of key launches in near term, Copaxone could remain a steady profit source and scale up from FY21 should be significant with 19% earnings CAGR over 3yrs. India and RoW revenues will also grow at 20% CAGR post FY20e with improving margins. Buy.
Edelweiss on home decor segment
The National Green Tribunal’s (NGT) / Gujarat Pollution Control Board’s (GPCB) recent order that stipulates Morbi ceramic units to move from coal gas input to natural gas will hit unorganised players hard as it would: i) increase their costs; ii) raise working capital requirements; and iii) bring them under the purview of taxation.
We believe these issues will further strengthen organised players, and reiterate our thesis that leaders with strong brands and distribution heft will gain market share and emerge winners over the long term. Hence, Kajaria Ceramics (KJC) and Centuryply (CPBI) remain our preferred picks.
Antique Stock Broking on ONGC
We expect 4QFY19 to be a quarter robust earnings as well, leading to highest ever stand alone profitability for ONGC. In light of such strong profitability healthy dividends payouts are also anticipated, thereby ensuring strong dividend yield.
Despite strong profitability and robust dividend yield stock continues to languish at a P/E of just 5xFY21e and P/BV of 0.7x FY21.We therefore reiterate our BUY rating with a target price of Rs 205/share ( at a P/BV of 1x FY21e)
Well-positioned to invest big in India: Fairfax Financial Holdings CEO
Prem Watsa, chief executive officer (CEO) of Canada-based Fairfax Financial Holdings, believes India is on a sustainable economic growth trajectory, driven by favourable business policies. READ MORE
MARKET COMMENT :: Chris Wood of CLSA
The ECB will now hold interest rates at the current level at least through to the end of 2019, and doubtless much longer, while the size of the ECB balance sheet will remain at the current €4.7tn as maturing bonds will continue to be re-invested. But the most important measure was the announcement of the ECB’s third round of its Targeted Longer-Term Refinancing Operations, otherwise known as TLTROs.
The central aim of the TLTROs has been to help out the problem areas of Eurozone banking, in particular Italian banks, while maintaining the official line that monetary policy in the Eurozone was not being conducted around the needs of any one specific country.
It clearly makes sense, tactically, to underwrite the Italian banks prior to the European parliamentary election campaign which has the potential to trigger a renewed surge in Italian borrowing costs as the League and the Five Star Movement renew their attacks on the Brussels establishment. But the TLTROs have only at best bought time while the Italian economy is slowing again.
It is only a matter of time before markets refocus on Italian risk. With the Italian 10-year government bond yield having declined 113bp from a recent high of 3.69% reached in October 2018, GREED & fear advises macro investors to start shorting Italian government bonds again.
(Source: Wood's weekly newsletter to investors, GREED & fear)
Christopher Wood, Managing Director & Equity Strategist, CLSA
Coal India Limited trading over 1.2% lower
Nifty PSU Bank index is trading over 1.7% higher, led by gains in J&K Bank, BoI
Rupee at 2019 high, gains 22 paise against US dollar in early trade
The rupee appreciated by 22 paise to 69.12 against the US dollar in the early trade on Friday amid sustained fund infusion by overseas investors. The domestic unit on Thursday gained 20 paise to close at a seven-month high of 69.34 against the US dollar Thursday, extending gains for a fourth session in a row, on robust foreign inflows ahead of general elections. READ MORE
Nifty Private Bank index is trading over 1% higher
Nifty hits 11,400 for the first time since September 18, 2018
Sectoral gainers and losers on NSE
MARKET AT OPEN
At 09:17 am, the S&P BSE Sensex was trading at 37,924 levels, up 169 points while NSE's Nifty50 index was trading 31 points higher at 11,374.
Market at pre-open
Rupee opens at 69.33/$ vs its previous close of 69.35 against the US dollar
Stocks in focus
Reliance Industries (RIL): Canadian investor Brookfield-led India Infrastructure investment trust (InvIT) is set to acquire East West Pipeline (EWPL), earlier known as Reliance Gas Transportation Infrastructure, from Mukesh Ambani for Rs 13,000 crore. READ MORE
Commodity outlook by Tradebulls Securities
Indian rupee continues to strengthen on the back of FIIs inflows. The currency is expected to test levels of 69.30-69.40. The domestic unit is nearing its oversold territory but there isn’t any divergence which suggests a reversal is imminent. So sell on the rise should be the theme until 71.40 is not breached on the upside. READ MORE
Derivatives strategy on Pidilite Industries by HDFC Securities
The stock has provided a breakout on the monthly charts, confirming higher tops and higher bottoms. The daily as well as weekly moving average convergence divergence (MACD) has come well into buy mode. With this breakout, the stock seems to have started its wave III up of wave 5; hence, we recommend it for the short-term target of Rs 2,320 with a stop loss of Rs 2,170. READ MORE
The rupee appreciated by 20 paise to close at a seven-month high of 69.34 against the US dollar Thursday, extending gains for a fourth session in a row, on robust foreign inflows ahead of general elections.
Brent crude oil futures were at $67.15 per barrel, 8 cents below their last close, but still within a dollar of the $68.14 2019-high reached the previous day. US West Texas Intermediate (WTI) crude oil futures were at $58.55 per barrel, down 6 cents from their last settlement, and not far off their 2019-high of $58.74 from the previous day.
At 8:01 AM (IST), Nifty futures on Singapore Exchange (SGX) were trading at 11,386, up 1 point or 0.01 per cent, indicating a flat start for the domestic market
Asian Markets check
Asian stocks made modest gains on Friday, tracking improved global sentiment after UK lawmakers voted to delay Brexit and as a weaker yen supported Japanese shares, but a fresh flare up in U.S.-China trade concerns is expected to cap gains. MSCI broadest index of Asia-Pacific shares outside Japan inched up 0.06 per cent. Japan’s Nikkei climbed 0.9 percent and South Korea’s KOSPI rose 0.45 per cent.
Wall Street check
The S&P 500 slipped on Thursday, snapping a three-day streak of gains, as uncertainty over when a trade deal between the United States and China would be reached left investors on edge. The Dow Jones Industrial Average rose 7.05 points, or 0.03 per cent, to 25,709.94, the S&P 500 lost 2.44 points, or 0.09 per cent, to 2,808.48, and the Nasdaq Composite dropped 12.50 points, or 0.16 per cent, to 7,630.91.
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