MARKET WRAP: Sensex ends 224 pts lower on global cues, fall in bank stocks

The benchmark indices closed lower taking cues from their global cues amid a weak rupee. The S&P BSE Sensex ended the day at 37,645 down 224 points while the Nifty50 index settled at 11,356 down 74 points.

 

HDFC Bank, down over 1%, was the top drag on the NSE Index after the lender on Friday said its deputy managing director was stepping down. While Nifty Bank index slipped over 1%, the Nifty PSU Bank index, too, ended nearly 3.2% lower.

Rupee at record low

The rupee on Monday touched an all-time low of 69.62 per dollar in early trade, tracking broader weakness in other emerging market currencies on concerns of a spill-over from a crisis-hit Turkey. The Reserve Bank of India was seen intervening to stem a sharp fall in the rupee, two dealers said. READ MORE HERE

Global markets

World markets shuddered on Monday, as Turkey's worsening currency crisis persuaded investors to dump equities and emerging markets and flee to safer assets such as government bonds and the dollar.

The MSCI world equity index, which tracks shares in 47 countries, was down 0.5% on Monday and 1.6% since Friday's open as the Turkish lira plunged to a record low, forcing the country's finance minister to announce an economic action plan to ease nerves .

The lira has tumbled on worries over Turkish President Tayyip Erdogan's increasing control over the economy and deteriorating relations with the United States. It fell as much as 12% at one stage on Monday, then recovered to a loss of 7%.

(With Reuters inputs)


3:49 PM IST Nifty PSU Bank index ends 3.22% lower. Top losers: COMPANY LATEST PREV CLOSE LOSS() LOSS(%) ALLAHABAD BANK 42.75 44.80 -2.05 -4.58 CANARA BANK 269.90 282.35 -12.45 -4.41 ANDHRA BANK 32.60 34.05 -1.45 -4.26 SYNDICATE BANK 39.55 41.30 -1.75 -4.24 BANK OF INDIA 90.00 93.60 -3.60 -3.85

3:39 PM IST Sectoral Trend

3:38 PM IST Top Sensex gainers and losers

3:33 PM IST Markets at Close The S&P BSE Sensex ended the day at 37,645, down 224 points while the broadr Nifty50 index setted at 11,356, down 74 points

3:00 PM IST Outlook on Indian banks to stay negative over weak core capital: Fitch Fitch Ratings on Monday said its outlook on Indian banking sector is likely to remain negative until banks, especially the public sector ones, address their weak core capital positions.   They need to improve capital base against mounting bad debt and poor financial performance, Fitch said. READ MORE

2:49 PM IST Gold prices fall further on dollar strength Gold prices extended declines into a third session on Monday, as the U.S. dollar climbed to a 13-month high against major peers amid financial crisis in Turkey. Spot gold had dropped 0.2 percent to $1,208.50 an ounce by 0655 GMT, hovering not far from a 17-month low of $1,204 hit earlier in August. U.S. gold futures were down 0.3 percent at $1,215.7 an ounce. READ MORE

2:39 PM IST Oil dips as emerging market woes dim demand outlook Oil prices slipped on Monday as trade tensions and troubled emerging markets dented the outlook for fuel demand, but U.S. sanctions against Iran pointed towards tighter supply ahead.   Benchmark Brent crude oil was down 25 cents at $72.56 per barrel. U.S. light crude was 25 cents lower at $67.38 a barrel. READ MORE

2:20 PM IST Apollo Hospitals surges 15% on strong Q1 results Shares of Apollo Hospital Enterprises (AHEL) have surged 15% to Rs 1,087 per share on the BSE after the company posted a strong 70.86% year on year growth in net profit at Rs 601.6 million during the quarter ended June 30, 2018 (Q1FY19). It had a profit of Rs 352.1 million during the same period last year. READ MORE

2:07 PM IST Nifty sectoral trend

2:01 PM IST BSE Sensex gainers and losers

1:57 PM IST Antique Stock Broking on Future Retail We expect margin expansion to continue, led by improvement in business mix, reduction in losses, and attaining of profitability in HyperCity, post restructuring. Further improvement in profitability of the small store business will aid margins in the coming years. In view of the underperformance on the earnings front, we cut our EPS estimates for FY19E and FY20E by 26% and 17% respectively to INR14.1 and INR15.0. Our target price stands revised to Rs 596. We maintain BUY

1:44 PM IST IT STOCKS ON A ROLL COMPANY LATEST() CHG() CHG(%) VOLUME FIRSTSOUR.SOLU. 64.10 3.35 5.51 1494188 TECH MAHINDRA 658.20 12.40 1.92 659827 INFIBEAM INCORP. 195.85 0.90 0.46 556049 TCS 2001.90 8.05 0.40 285026 INFOSYS 1408.00 22.80 1.65 191666 » More

LIVE UPDATES

Nifty PSU Bank index ends 3.22% lower. Top losers:

COMPANY LATEST PREV CLOSE LOSS() LOSS(%)
ALLAHABAD BANK 42.75 44.80 -2.05 -4.58
CANARA BANK 269.90 282.35 -12.45 -4.41
ANDHRA BANK 32.60 34.05 -1.45 -4.26
SYNDICATE BANK 39.55 41.30 -1.75 -4.24
BANK OF INDIA 90.00 93.60 -3.60 -3.85

Sectoral Trend


Top Sensex gainers and losers


Markets at Close

The S&P BSE Sensex ended the day at 37,645, down 224 points while the broadr Nifty50 index setted at 11,356, down 74 points
Outlook on Indian banks to stay negative over weak core capital: Fitch

Fitch Ratings on Monday said its outlook on Indian banking sector is likely to remain negative until banks, especially the public sector ones, address their weak core capital positions.
 
They need to improve capital base against mounting bad debt and poor financial performance, Fitch said. READ MORE

Gold prices fall further on dollar strength

Gold prices extended declines into a third session on Monday, as the U.S. dollar climbed to a 13-month high against major peers amid financial crisis in Turkey.

Spot gold had dropped 0.2 percent to $1,208.50 an ounce by 0655 GMT, hovering not far from a 17-month low of $1,204 hit earlier in August. U.S. gold futures were down 0.3 percent at $1,215.7 an ounce. READ MORE

Oil dips as emerging market woes dim demand outlook

Oil prices slipped on Monday as trade tensions and troubled emerging markets dented the outlook for fuel demand, but U.S. sanctions against Iran pointed towards tighter supply ahead.
 
Benchmark Brent crude oil was down 25 cents at $72.56 per barrel. U.S. light crude was 25 cents lower at $67.38 a barrel. READ MORE

Apollo Hospitals surges 15% on strong Q1 results

Shares of Apollo Hospital Enterprises (AHEL) have surged 15% to Rs 1,087 per share on the BSE after the company posted a strong 70.86% year on year growth in net profit at Rs 601.6 million during the quarter ended June 30, 2018 (Q1FY19). It had a profit of Rs 352.1 million during the same period last year. READ MORE

Nifty sectoral trend


BSE Sensex gainers and losers


Antique Stock Broking on Future Retail

We expect margin expansion to continue, led by improvement in business mix, reduction in losses, and attaining of profitability in HyperCity, post restructuring. Further improvement in profitability of the small store business will aid margins in the coming years. In view of the underperformance on the earnings front, we cut our EPS estimates for FY19E and FY20E by 26% and 17% respectively to INR14.1 and INR15.0. Our target price stands revised to Rs 596. We maintain BUY
IT STOCKS ON A ROLL

COMPANY LATEST() CHG() CHG(%) VOLUME
FIRSTSOUR.SOLU. 64.10 3.35 5.51 1494188
TECH MAHINDRA 658.20 12.40 1.92 659827
INFIBEAM INCORP. 195.85 0.90 0.46 556049
TCS 2001.90 8.05 0.40 285026
INFOSYS 1408.00 22.80 1.65 191666
» More
MUTUAL FUNDS Why you should not exit funds based on a year's underperformance

Large-cap funds have underperformed their benchmarks by a wide margin over the past year. Even funds in the large- and mid-cap category and the multi-cap category (most funds in these categories currently have high exposure to large-cap stocks) are also underperforming their benchmarks by wide margins READ MORE
MARKET CHECK

Index Current Pt. Change % Change
 
S&P BSE SENSEX 37,766.26 -102.97 -0.27
 
S&P BSE SENSEX 50 11,931.27 -28.16 -0.24
 
S&P BSE SENSEX Next 50 33,801.43 -32.06 -0.09
 
S&P BSE 100 11,672.03 -25.09 -0.21
 
S&P BSE Bharat 22 Index 3,607.53 -5.25 -0.15

Here's why the US sanctions on Iran oil will hurt India more than you think

The first US sanctions have been reimposed on Iran with little sign of either side softening its position. Curbs on oil exports will follow in early November and the effect will be bigger and swifter than last time around. Oil forecasters don't seem to have grasped that yet.

There’s no doubt that President Donald Trump will be tougher on Iran than Barack Obama was, with no gradual ratcheting-up of pressure. Importers are expected to have tapered off oil purchases by November 5, when the curbs come into effect. READ MORE

Sun TV Network dips 6% after June quarter results

Shares of Sun TV Network have slipped 6% to Rs 776 per share on the BSE, after the company reported 63% year-on-year (YoY) growth in net profit at Rs 4.09 billion in June quarter (Q1FY19) driven by strong performance from its IPL franchise. The revenue was up 42% at Rs 11.20 billion on YoY basis. READ MORE

FUND PICK UTI Regular Savings Fund: Conservative on risk, superior on return

The fund was launched in December 2003 as UTI-MIS Advantage Plan. Subsequent to the re-categorisation of mutual fund (MF) schemes by the Securities and Exchange Board of India (Sebi), it was renamed UTI Regular Savings Fund in May this year.
 
The fund has featured in the top 30 percentile in the conservative hybrid funds category of CRISIL Mutual Fund Rankings (CMFR) for the two quarters ended June 2018. READ MORE

United Breweries rallies 7% on strong Q1 results

United Breweries (UBL) rallied 7% to Rs 1,286 on the BSE in intra-day trade after the company reported healthy 37% year-on-year (YoY) increased in net profit at Rs 2,219 million in June quarter (Q1FY19). Revenue grew 11.2% at Rs 18.66 billion on YoY basis.
 
The company reported 12% volume growth compared with industry average growth of 9% during the quarter. READ MORE

MARKET COMMENT Rushabh Maru - Research Analyst , Anand Rathi Share on rupee

Emerging market currencies have declined sharply as Turkish lira has fallen to all time low level after US president Donald Trump imposed sanctions and tariffs on Turkey. The crisis is unlikely to resolve anytime soon. An absence of aggressive intervention by the RBI has also hurt the rupee.

Market is nervous ahead of India’s CPI data due later today. The dollar has strengthened to multi-month high on expectations of aggressive interest rate hikes by the Federal Reserve in coming months as the US economy is experiencing strong growth momentum. Hence, due to all these factors, the rupee has declined to all time low level today
HDFC Securities on Jamna Auto

We  have  cut  EPS estimates by 6% for FY19/20 factoring in margin pressure and  increase  in depreciation and interest cost. Expect revenue/EPS growth of  17/27%  over  FY18-20E.Given  the superior return ratios, ROE(+30%),and phenomenal  growth,  JAMNA  will  continue  to  trade  at  premium  vs  its historical  multiple(15x).  We  value the stock at Rs 100 (20xFY20E) vs 107 earlier. Maintain BUY.
HDFC Securities on Jamna Auto

We  have  cut  EPS estimates by 6% for FY19/20 factoring in margin pressure and  increase  in depreciation and interest cost. Expect revenue/EPS growth of  17/27%  over  FY18-20E.Given  the superior return ratios, ROE(+30%),and phenomenal  growth,  JAMNA  will  continue  to  trade  at  premium  vs  its historical  multiple(15x).  We  value the stock at Rs 100 (20xFY20E) vs 107 earlier. Maintain BUY.
MARKET COMMENT Rabobank International on developments in Turkey

Turkey is almost certain to need a bail-out ahead: the key issue is, in which currency? If it is via the IMF it will be in USD, as usual, and with all the usual strings attached: austerity, privatisation, reforms, and pro-US foreign policy.

If it is from ‘new friends’ Russia or China, things will look very different. Loans would be in RUB or CNY, and would be a huge step towards de-dollarization and Turkey’s financial, economic, political, and yes, military reorientation eastwards. That is Great Power and Great Currency hand in hand - and Turkey is neither
KR Choksey Institutional Equities on Suzlon

The prolonged timeline for settling grime has impacted Suzlon’s financial performance since last few quarters. We believe commissioning can ramp up post Q3FY19 and hence one can expect FY19 to be washout year as FY18.

On the other side, it is expected that SECI VI will open in Aug’18 and Suzlon historically garnered 25% market share in terms of overall order wins. Thus, this improves order backlog visibility in the coming period. Apart from this, the company is already into advance negotiation with few IPPs for 20% of the earlier 7.5GW auctioned orders; any positive surprise can augur well for the company going ahead.
 
We have lowered FY19E estimates, while maintained FY20E estimates. We valued the company on SOTP basis and arrived a target price of Rs 15.8, upside potential of 119%. We retain BUY rating on the stock.
TOP GAINERS & LOSERS IN THE FINANCIAL SECTOR (BSE)

COMPANY LATEST() CHG() CHG(%) VOLUME
PUNJAB NATL.BANK 82.10 -1.05 -1.26 1636205
ST BK OF INDIA 296.25 -8.20 -2.69 1289253
IDFC BANK 44.35 1.05 2.42 619101
IDBI BANK 61.55 -0.30 -0.49 458254
BANK OF INDIA 91.65 -1.85 -1.98 425399
» More
Anand Rathi on Hinduja Global

In line with estimates, HGS’ Q1 revenue was $165m (down 2% q/q, up 6% y/y, adj for acquisition) but the 6.6% margin (down q/q, 416bps y/y) disappointed. The acquired entities saw a sharper decline in revenue ($17m/qtr disclosed on acquisition but the current rate is only $12m).

Consequently, EBITDA loss in the acquired entity was $3.6m, adjusting for which HGS had 9.5% EBITDA margins. Recovery will be slow and contingent on revenues scaling up. We cut our FY19e and FY20e ~15-16%, leading to a revised target of Rs 990 (9x FY20 EPS)
Investec Securities on Sun TV

Sun reported strong 1Q rev growth of 42% yoy and EBIT growth of 70% yoy, beat on consensus, led by IPL franchise (Rs2.2bn EBIT vs our expectation of Rs1bn). Core broadcast BU weak with 14% rev growth and flat EBIT (margin declined 690bps) – all the cost lines were elevated, especially film costs (D&A expenses up 42% yoy). The company noted one-off costs of Rs0.5bn related to its 25th anniversary.

To us, the deal-breaker (or maker) remains declining shares across key markets (Tamil/Telugu). Factoring in IPL gains in FY19E and beyond, we increase estimates 2-3%; new target price Rs880 (Rs870 earlier)
Emkay on Aurobindo Pharma

Q1FY19 was marred by write-offs relating to shelf stock adjustment, which is largely non-recurring in nature. Adjusted for the same, numbers are strong, especially given the current challenging business environment.  Return ratios for ARBP are the highest among its comparable peers. We maintain BUY rating with a Target Price (TP) of Rs690, valuing it at 15x on FY20E EPS of Rs46
Markets at noon 

INDEX LATEST PREVIOUS CHANGE CHANGE(%)
NIFTY 50 11360.05 11429.50 -69.45 -0.61
NIFTY 500 9666.05 9724.45 -58.40 -0.60
NIFTY MIDCAP 100 19049.60 19135.95 -86.35 -0.45
NIFTY SMALL 100 7466.25 7537.30 -71.05 -0.94
INDIA VIX 13.42 12.85 0.57 4.44
> More on NSE Indices
Investors should avoid MFs with high expense ratios: All you need to know
 
Avoid paying a high expense ratio in categories where the scope for generating high outperformance doesn't exist Former Sebi chief U K Sinha recently said that India's mutual fund industry is among the most expensive globally and there is scope for bringing down costs The bottomline, according to experts, is that a high expense ratio is justified only in products that manage to generate high alpha Actively-managed equity funds in India have traditionally generated high alpha. READ MORE
Tata Motors, Tata Motors DVR hit 52-week low on drop in global sales
 
Shares of Tata Motors and Tata Motors (DVR) have hit their respective 52-week lows after the company reported 5% drop in global sales, including that of Jaguar Land Rover (JLR), to 92,639 units in July.
 
“Global wholesales of all Tata Motors’ commercial vehicles and Tata Daewoo range in July 2018 were at 40,443 units, higher by 29%, over July 2017,” the company said in a regulatory filing. READ MORE
Sector consolidation likely to benefit IndiGo and SpiceJet
 
Despite the weak macro environment and severe competitive intensity in the aviation sector, Interglobe Aviation (IndiGo) and SpiceJet stocks gained 3.5–6.5 per cent over the last two trading sessions.
 
On the other hand, delay in announcing its June quarter results and a stretched balance sheet saw Jet Airways share price shrinking over 11 per cent last week. While headwinds in the form of high oil prices (and hence, air turbine fuel), weak rupee and competitive pressures remain. READ MORE
It will be biz as usual at HDFC Bank despite Sukthankar leaving: analysts
 
Shares of HDFC Bank opened 2% lower at Rs 2,075 on the BSE, after the country’s largest private sector lender said its deputy managing director, Paresh Sukthankar, has tendered his resignation. The announcement came in on Friday after market hours. The stock, however, recovered partially as trade progressed.
 
Analysts had expected the stock to see a knee-jerk reaction to the development. Most suggest the fall can be bought into from a long-term perspective. READ MORE
Nifty IT index hits new high; Infosys at record high of Rs 1,400 on the NSE
 
Shares of information technology (IT) companies are in focus on Monday, with the Nifty IT index hitting new high after the Indian rupee slipped to a record low of 69.53 per dollar in the early trade on Monday. It has opened at 69.49 per dollar on today versus 68.83 Friday.
 
Among individual stocks, Infosys hit a record high of Rs 1,400, up 1% on the NSE in early morning trade. The stock surpassed its previous high of Rs 1,392 touched on July 25, 2018 in intra-day trade. READ MORE
Anant Bajaj, managing director of Bajaj Electricals, passes away
 
Anant Bajaj, managing director (MD) of Bajaj Electricals, passed away on Friday after a heart attack. He was 41. Bajaj, the only son of company chairman Shekhar Bajaj, took over as MD in June. An alumnus of Harvard Business School, Anant Bajaj was associated with the firm for nearly 20 years, becoming joint MD in 2012. READ MORE
 
STOCK IMPACT
 

INTERVIEW OF THE DAY FPIs' participation in IPOs has reduced as MFs have got bigger: Khaitan

Deal-making this year has become more challenging with increasing market volatility. Sunil Khaitan, India head, global capital markets, Bank of America Merrill Lynch, shares his view on the outlook and trends on the primary market with Samie Modak READ MORE


Sunil khaitan, India head, Global Capital Markets,Bank of America Merrill Lynch

TOP BSE LOSERS

COMPANY PRICE() CHG() CHG(%) VOLUME
INDIA CEMENTS 109.80 -7.15 -6.11 353136
BAJAJ ELECTRICAL 569.75 -35.85 -5.92 55273
HEG 4115.55 -220.15 -5.08 29937
RELIANCE NAV.ENG 19.01 -1.00 -5.00 374304
8K MILES 336.00 -17.65 -4.99 2660
» More on Top Losers
ICICI Securities on Coal India

The sharp improvement in the company’s profitability in Q1FY19 reaffirms our view of significant earnings improvement YoY in FY19 (I-Sec: 134% growth) as recent price hike and implementation of evacuation facility surcharge, along with various cost control measures, helps CIL fully recover from the impact of various cost increases.
Elara Capital on APL Apollo Tubes

We believe the company will retain its leadership position in the industry on the back of aggressive volume growth and better product mix, which will drive earnings. We expect a 24% EBITDA CAGR over FY18-20E to Rs 5.7bn. Increased profitability coupled with higher cashflow and minimal capex will aid in deleveraging. We continue to value the company at 11x FY20E EV/EBITDA with a target price of Rs 2,455. We reiterate Buy
ICICI Securities on Dr Lal Pathlabs

We remain positive on long term outlook of Dr Lal considering its strong brand franchise in the organized market with sustainable growth, expansion potential, healthy free cash flow generation and strong return ratios.

The margins would be under pressure in near term due to higher operational costs of Kolkata national reference lab; however, we expect improvement FY20 onwards with volume pick up. We largely maintain our estimates and retain BUY rating on the stock with revised target price of Rs1,066/share (earlier Rs1,015).
Edelweiss on Voltas

Operating performance came in stronger than expected with revenue/EBIDTA growth of 11/17% led by better UCP performance and higher-than-expected project margins. Key highlights: 1) In our view, with rising share of inverter ACs (50% of market), Voltas’s growth/market share of ~7%/23.5% reflects its improving position in inverters ACs (40% of secondary sales for Voltas). 2) The Projects business continues to gain traction with new projects at decent margins driving profitability; we expect this trend to sustain given robust infra opportunities in domestic market.

Our ‘’BUY/Sector Outperformer rating and target price of Rs 685 (cooling business valued at ~38x PE) factors in Voltas’s sustained competitive edge (brand/reach) in room ACs despite intense competition. This complements its entry into a bigger white goods market through the VoltBek JV
MUST READ Q1 results: Mid-cap stocks see upward revision in 12-month price targets
 
The consensus 12-month price targets for several mid-cap companies have increased following better-than-expected first quarter earnings. Nearly 174 stocks on the BSE 500 index have seen an upgrade in their target price during the last three month.
 
Around 65 stocks have seen an increase of more than 10 per cent. This upgrade in the mid-cap stocks comes as a relief since the segment has witnessed an intense selling pressure between February and June this year. READ MORE
Market Check

INDEX LATEST PREVIOUS CHANGE CHANGE(%)
BSE SENSEX 37593.50 37869.23 -275.73 -0.73
BSE 500 15312.05 15423.22 -111.17 -0.72
BSE MID-CAP 16073.65 16210.78 -137.13 -0.85
BSE SMALL-CAP 16610.40 16784.20 -173.80 -1.04
S&P BSE LARGECAP 4403.00 4432.23 -29.23 -0.66
> More on BSE Indices
HDFC Bank Concall

Aditya Puri of HDFC Bank says 'There will no more be a Deputy Managing Director's post in HDFC Bank'
MARKET REACTION It will be biz as usual at HDFC Bank despite Sukthankar leaving: analysts

HDFC Bank is not new to attrition and several top management personnel have left in the past five years to join competitors but that hasn’t affected the performance of the bank which goes to show it is a very system driven bank. Growth and asset quality continues to be stable. There are clear cut leadership transition responsibilities defined and usually replacement happens very seamlessly READ MORE
HDFC Bank Concall

HDFC Bank's Aditya Puri: I will not be the only one who will be choosing the successor. Have yet to start with process of appointing a successor
HDFC Bank Concall
 
Paresh Sukthankar was a contender for the post of MD & CEO. Succession plan for MD & CEO will continue despite Sukthankar's exit. His exit not linked to search of MD & CEO; exit was on personal grounds 
HDFC Bank Concall

Aditya Puri of HDFC Bank says personally, sad from the resignation of Paresh Sukthankar. Board will decide w.r.t replacement of Sukthankar in 10-15 days
Paresh Sukthankar resigns as HDFC Bank's deputy managing director
 
HDFC Bank’s Paresh Sukthankar has resigned from the board of the country’s largest private sector bank. He will vacate the post of deputy managing director.
 
Sukthankar has been with HDFC Bank since its inception in 1994. Currently, he is overseeing the banks’ credit and risk management departments as well as finance and human resources 

Stock Impact
 

Rupee trading strategy from Motilal Oswal



Nifty sectoral trend


BSE Sensex heatmap


Markets at open
 
At 9:16 AM, the S&P BSE Sensex was trading at 37,594, down 275 points while the broader Nifty50 was ruling at 11,352, down 77 points.
Top trading ideas by Devang Shah
 
TCS - BUY
CLOSE – Rs- 1995
TARGET – Rs 2050-2100
 
TCS closed the weekly in positive territory. Its still trading above 20 DMA. It has wave-V up pending as per weekly chart. Risk Reward is favourable to BUY at current levels. Its daily mometum indicatros are in BUY.One can BUY with a stop loss of Rs-1870 for the target of Rs-2050-2100 levels in short-term.

Click here for more
MARKET COMMENT G Chokkalingam of Equinomics Research

we believe that this shallow market rally cannot continue – it is madness to keep rising the valuation multiples above 10 times book values for the financials and above 70 PE for the consumer themes on trailing basis. We believe that the sense would prevail soon and quality mid cap stocks would recover substantially.

This happened historically without fail – only time duration was an issue. We suggest that the investors to use the opportunity of prevailing dichotomy in the valuations (between top 15 stocks and mid cap stocks) and focus on quality small and mid cap stocks to create wealth in the long-term
RUPEE ALERT Rupee hits record low of 69.47 per dollar 
Markets at pre-open

Index Current Pt. Change % Change
 
S&P BSE SENSEX 37,805.57 -63.66 -0.17
 
S&P BSE SENSEX 50 11,940.46 -18.97 -0.16
 
S&P BSE SENSEX Next 50 33,880.94 +47.45 +0.14
 
S&P BSE 100 11,683.39 -13.73 -0.12
 
S&P BSE Bharat 22 Index 3,606.18 -6.60 -0.18

IIFL on Capacit’e Infraprojects Ltd

Going ahead, the company expects order inflows to be robust based on the strong order pipeline from its existing clients and opportunities arising from the affordable housing segment. With massive order book in hand and robust execution capabilities, revenues are likely to witness strong growth over the next few years.

The earnings growth is likely to remain healthy with high margin orders in hand. We expect topline to clock ~27% CAGR over FY18-20E with margins of ~15%. At the CMP, CIL is trading at attractive valuation of 14x FY20E P/E. We maintain our BUY rating on the stock for target price of Rs.402 per share.
MARKET COMMENT Amar Ambani, head of research, IIFL

Stock-specific volatility will continue as corporate earnings are closely watched. The market is expected to consolidate further during this truncated week. Seven of the 10 most valued companies added around Rs. 48,500 crore in market capitalisation last week. Tata Steel, Cadila Healthcare, CARE Ratings, Godrej Industries, DHFL and Ashoka Buildcon will announce their results today. Both the Sensex and Nifty closed lower on Friday.

The outlook is a soft start. US stocks ended lower on Friday. Asian counterparts are on the backfoot. The rupee, which had a rough ride on Friday and fell by 15 paise will be eyed. On the bright side, foreign investors have upped their buying in Indian capital market. They put in more than Rs 2,300 crore into equities while added a little over Rs 6,200 crore into the debt market in August
Nifty outlook by Devang Shah
 
Short-term outlook for the market remains positive till Nifty trades above 10929 levels and expecting targets in the range of 11,500- 11,600 levels in short term. Medium term outlook for the market remains positive till Nifty trades above 9,951 levels and expecting targets in the range of 12,400-12,500 levels in medium term. READ MORE
Nomura on IIP numbers

Despite the better performance in June, industrial activity softened in Q2 (averaging 5.2% y-o-y from 6.6% in Q1). Still, we forecast Q2 GDP growth (data out 31 August) will accelerate to 7.8% y-o-y, from 7.7% in Q1. However, we believe growth peaked in Q2 and will slow to an average of 7.2% in H2 2018, owing to the fading effects of remonetisation, tighter financial conditions and weaker global growth.

Our composite leading indicator is also signalling a reversal in non-agriculture GDP growth in Q3 after six consecutive quarters of increases.
Top trading ideas by Prabhudas Lilladher:
 
BUY AUROBINDO PHARMA
CMP: Rs 610.90
TARGET: Rs 655
STOP LOSS: Rs 580
 
The stock has made a series of higher bottom formation pattern in the daily chart taking support at the significant 50 DMA moving average which lies near 598 levels. The chart looks attractive for further rise in the coming days and with increasing volume participation witnessed, a positive bias has been maintained and we recommend a buy in this stock for an upside target of 655 keeping a stop loss of 580.
Nifty outlook by Prabhudas Lilladher:
 
Nifty is showing signs of exhaustion now with individually all sectors show no clarity to propel market to surge higher, IT could get in new round of momentum, and support for the week is seen at 37,160/11,200 while resistance is seen at 38,350/11,580. Bank Nifty would have a range of 27,420-28,620. The daily trend in Nifty has turned down after 2 days, while Bank Nifty still continues to be in positive.
STOCK TO WATCH TODAY Paresh Sukthankar resigns as HDFC Bank's deputy managing director

HDFC Bank’s Paresh Sukthankar has resigned from the board of the country’s largest private sector bank. He will vacate the post of deputy managing director.
 
Sukthankar has been with HDFC Bank since its inception in 1994. Currently, he is overseeing the banks’ credit and risk management departments as well as finance and human resources READ MORE HERE
June IIP accelerates to 7% vs 3.9% in May, at highest level in 5 months
 
Industrial output measured by the Index of Industrial Production (IIP) accelerated to 7 percent month-on-month (MoM) for June from 3.9 per cent in May. This is the highest level achieved by the index in the last five months.
 
As per data released Friday, growth was driven by a pickup in capital goods manufacturing, which contributes 78 per cent of the index, ahead of festive season. Manufacturing grew 6.9 per cent in June compared with a 2.8 per cent increase in May. 
Edelweiss on State Bank of India

State Bank of India (SBI) reported Q1FY19 loss of Rs 49bn due to higher provisions (rising coverage and up-fronting MTM losses). Key highlights: a) slippages were elevated at Rs 144bn largely due to higher non-watch list slippages from seasonally higher retail/agri NPLs and devolvement of non-fund-based (NFB) exposure. Bank expects this trend to normalise and maintained slippages and credit cost guidance of 2% each; b) positively, as coverage rose to >55%, NNPLs fell to 5.3%; and c) NCLT recovery has started crystalising and revenue was supported by better recoveries.

We believe, SBI is better positioned among peers—CET-1 at 9.8%, NNPLs at <5.3% and CASA at ~45%. Furthermore, normalised slippage with resolution of stressed assets kicking-in will impart better earnings visibility. Maintain ‘BUY
SGX Nifty
 
Trends on SGX Nifty indicate a negative opening for the broader index in India, a fall of 50.5 points or 0.44 per cent. Nifty futures were trading around 10,381-level on the Singaporean Exchange
Oil prices edge up on Iran sanctions
 
Oil prices inched up on Monday as US sanctions against Iran pointed towards a tighter market, although concerns over slowing economic growth amid global trade tensions kept a lid on gains.
 
Front-month Brent crude oil futures were at $72.88 per barrel, up by 7 cents from their last close. US West Texas Intermediate (WTI) crude futures were up 16 cents at $67.79 per barrel.
Asia shares, euro pressured by Turkish crisis
 
Asia share markets slipped and the euro hit one-year lows on Monday as a fresh fall in the Turkish lira fueled demand for safe havens, including the US dollar, Swiss franc and yen. Japan’s Nikkei lost 0.95 per cent and MSCI’s broadest index of Asia-Pacific shares outside Japan eased 0.3 per cent as bourses across the region turned red.
Markets on Friday

INDEX LATEST PREVIOUS CHANGE CHANGE(%)
BSE SENSEX 37869.23 38024.37 -155.14 -0.41
BSE 500 15423.22 15500.19 -76.97 -0.50
BSE MID-CAP 16210.78 16340.88 -130.10 -0.80
BSE SMALL-CAP 16784.20 16916.85 -132.65 -0.78
S&P BSE LARGECAP 4432.23 4450.44 -18.21 -0.41
> More on BSE Indices
Wall Street ends lower as Turkey woes hit banks
 
US stocks slid on Friday as a deepening economic crisis in Turkey dragged on bank shares and triggered a move out of riskier assets. The Dow and S&P 500 posted declines for the week following five straight weeks of gains, but the S&P 500 remains just 1.4 per cent below its record high from January 26.
 
The Dow Jones Industrial Average fell 196.09 points, or 0.77 per cent, to 25,313.14, the S&P 500 lost 20.3 points, or 0.71 per cent, to 2,833.28 and the Nasdaq Composite dropped 52.67 points, or 0.67 per cent, to 7,839.11. 
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