India : Sensex, Nifty end in red; Bank Nifty at 17-month high
After a lot of struggle, the market ended in red. The Sensex was down 46.44 points or 0.2 percent at 28077 and the Nifty was down 6.35 points at 8666.90. About 1480 shares have advanced, 1237 shares declined, and 182 shares are unchanged.Large private sector banks are likely to get disproportionate market share over next couple of years says Munish Dayal, Partner of Baring Private Equity sharing his outlook on the banking sector. Private sector banks, particularly few large ones, now have the ability to raise incremental capital, he says. Public sector banks, on the other hand, will continue to struggle with asset quality issues for a while and be unable to raise incremental capital, he adds.
He believes the merger of associates with SBI augurs well for the country’s largest lender as it gets foothold in states where the associates have better presence and immediate benefits on treasury operations. This, apart from having 22 percent of industry’s total advances and deposits and balance sheet size of roughly Rs 37 lakh crore.
SBI, BHEL, Tata Steel, HUL and Cipla were top gainers while Coal India, TCS, Lupin, Sun Pharma and M&M were losers in the Sensex. Bank Nifty ended at new high.
There have been more positive surprises, albeit marginally, than negative ones in first quarter corporate earnings, says Mahesh Patil, Co-CIO of Birla Sun Life AMC in an interview to CNBC-TV18. Patil says the fund is now picking up stocks with sustained visibility of growth like selective automobile companies and in the private sector banking and non-banking finance spaces. Patil believes good monsoon and pay hikes will lift consumer discretionaries. These factors will aid credit growth too leading to better growth in banking space, he says. He is more upbeat on private banking yet though, as even while non-performing assets of most public banks has peaked out, provisioning will continue to mar their profits and return on equity, he adds.
Gold rallied by Rs 100 to Rs 31,250 per 10 grams at the bullion market today on continued buying by jewellers even as the precious metal weakened overseas. However, silver fell by Rs 185 to Rs 46,465 per kg on reduced offtake by industrial units and coin makers.
Bullion traders said persistent buying by jewellers at domestic markets to meet festive season demand, mainly influenced gold prices.
Globally, gold fell 0.5 percent to USD 1,345.80 an ounce in Singapore as the dollar rebounded and a Federal Reserve policy maker said the US economy is strong enough to warrant an increase in interest rates soon.
European shares were poised to post their biggest weekly loss in two months and crude oil edged to eight-week highs on the back of a weaker dollar and hopes of a production cut. Mixed messages from the Fed in recent days have left investors cagey ahead of next week’s annual meeting of central bankers from around the world in Jackson Hole, Wyoming, in which Fed Chair Janet Yellen is likely to cement expectations for a slow pace of rate increases.European shares fell 0.6 percent on the day and are off 1 percent for the week, their biggest weekly loss since the mid-June. The index is down 6.7 percent this year, but has rebounded 11 percent from its post-Brexit vote low.
