Market Live: Nifty sluggish as FO expiry eyed; Kotak Bank, Aurobindo up
Thu Mar 30 2017
Ramesh Sridharan (877 articles)

Market Live: Nifty sluggish as FO expiry eyed; Kotak Bank, Aurobindo up

2:10 pm Market Check: Sluggishness in the market continued ahead of the expiry of March F&O series, with the Nifty snapping 9150.

The Sensex was up 34.95 points at 29566.38, while the Nifty was up 5.90 points at 9149.70. The market breadth was narrowing with 1,686 shares advancing against a decline of 902 shares, while 213 shares were unchanged.

Top gainers continued to be SBI, Adani Ports and Aurobindo Pharma, while Coal India and Axis Bank were the top losers.

CL Educate, which completed initial public offer (IPO) last week, will make the stock market debut on March 31.

The company’s IPO was oversubscribed 1.90 times, with qualified institutional buyers (QIBs) category getting oversubscribed 3.65 times and retail investors 1.63 times. The ‘non-institutional investor’ portion was subscribed only 21 percent.

1:55 pm NSE and algo controversy: As the National Stock Exchange (NSE) prepares for an initial public offering (IPO), allegations of its trading systems being prone to manipulation could prove to be a major hurdle.

The exchange has been under the Securities and Exchange Board of India (SEBI) scanner for violation of fair norms in algorithmic trading practices.

To look into the matter the regulator had hired Deloitte that confirmed some of the allegations.

In a letter to Sebi, dated February 14, the whistle blower had said, “I am glad to note finally some action has taken place on the complaints.”

1:36 pm SC verdict impact on auto cos: The landmark Supreme Court ruling of yesterday banning sale of old and polluting Bharat Stage III (BS-III) vehicles has kick-started a discounting frenzy at bikes, three-wheelers, trucks and buses dealerships.

Desperate dealers are giving away three to four fold higher discounts compared to normal conditions as there is an eagerness to liquidate the BS-III inventory which will become obsolete after April 1.

Hero Motocorp, the country’s largest two-wheeler company, is giving away discounts of Rs 12,500 in addition to free insurance. Hero is believed to have the largest stockpile of BS-III vehicles which could be in the region of 200,000 units.

Trucks and buses are also at the center of the discount storm with dealers handing out anywhere between 4-12 percent discounts to buyers depending on the order size. This translates to Rs 50,000-400,000.

1:20 pm Capex: State-owned Mahanagar Telephone Nigam plans to invest Rs 400 crore for installing and commissioning 1,800 mobile towers over the next 8-10 months to improve coverage and data speeds for its subscribers.

The loss-making telecom corporation said it has lined up the financing for the project from banks.

“MTNL is taking up many network expansion initiatives. We are going to expand 1,800 sites in Delhi in the next 8-10 months,” MTNL Chairman and Managing Director P K Purwar told PTI.

The new towers, nearly 450 which are already installed and will undergo testing, are set to be commissioned from next month onwards in a phased manner, he added.

1:00 pm Market Check: The Nifty remained sluggish in afternoon ahead of expiry of March futures & options contracts. Investors awaited March quarter earnings due next month that will give direction to the market.

The 30-share BSE Sensex was up 38.27 points at 29,569.70 and the 50-share NSE Nifty gained 7.65 points at 9,151.45. The broader markets continued to outperform benchmarks, with the Nifty Midcap rising 0.3 percent.

About two shares advanced for every share falling on the BSE.

Kotak Mahindra Bank gained over a percent on fundraising plan by diluting Uday Kotak’s stake while Aurobindo Pharma was up 1 percent as it has received final approval from the US health regulator to manufacture abacavir sulfate and lamivudine tablets, used in the treatment of HIV.

Also read – Nifty back @9K: As demonetisation & GST grab eyeballs; check out 15 top ideas

12:50 pm Fundraising: Kotak Mahindra Bank said it would raise up to approximately Rs 5,500 crore via issue of up to 6.2 crore equity shares.

Fundraising will lead to maximum 3.4 percent equity dilution. Promoter Uday Kotak’s stake will come down to 31.2 percent from 32.1 percent.

12:35 pm The Uday Kotak Interview: Although Kotak Mahindra Bank’s press conference yesterday may have disappointed some market participants who were expecting a big bang announcement, the bank made a pitch for a digital play that was in line with the government’s own push in that direction.

Talking to moneycontrol’s Beena Parmar, Executive Vice Chairman and Managing Director Uday Kotak also spoke on consolidation in the banking industry.

“It is never easy,” he said. Kotak also sees potential for private sector participation in resolving Rs 10 lakh crore worth of recoverable stressed loans. You can read the full interview here.

12:15 pm Market Check: Equity benchmarks trimmed some of its morning gains as the Street consolidated ahead of March F&O series’ expiry.

The Sensex was up 57.62 points at 29589.05, while the Nifty was up 13.15 points at 9156.95. The market breadth was positive as 1,672 shares advanced against a decline of 742 shares, while 181 shares were unchanged.

Adani Ports, SBI and Aurobindo Pharma continued to gain on the indices, while Axis Bank and BHEL were the top losers.

AC, fan and cooler manufacturers gained on the back of early arrival of summer and possibility of an elongated one due to below normal monsoon. Voltas, Hitachi, Blue Star, Symphony and Havells India gained between 2 and 5 percent intraday.

11:59 am Buzzing Stock: Shares of Berger Paints India rose nearly 2 percent intraday Thursday as it commenced production at Assam plant.

The company’s British Paints division has commenced commercial production of its paint and putty plant at Nalbari, Assam on March 29.

This plant has a capacity of 6600 K/MT per annum of solvent and water based paints and 7200 MT per annum of putty and distemper.

11:39 am Management Speak: “This summer is going to be as great a summer as it was last year”, B Thiagarajan, joint MD of Bluestar told CNBC-TV18 in an interview.

According to him, the market will grow at around 20-25 percent in FY17 and company’s air-conditioning segment is expected to grow by 35 percent in FY17.

With the passage of Goods and services tax (GST), prices of ACs will go up by around 2-3 percent, he said.

11:23 am LIC to invest in UCO Bank: After UCO Bank twice requested Life Insurance Corporation (LIC) to invest in tier-II bonds of the bank, the insurer has finally agreed to invest Rs 1,000 crore, a source told Moneycontrol.

Earlier this month, a Moneycontrol exclusive story had reported that the state-run UCO Bank had written to LIC requesting it to invest Rs 1,000 crore in tier-II bonds of the bank. This letter was submitted to the insurer on March 15.

According to sources, the largest insurer LIC has given an in-principal approval to the bank and will invest Rs 1,000 crore in tier-II bonds. However, this investment will be subject to documents that the bank needs to provide within seven days.

11:05 am Market Check: Equity benchmarks were in the green, but were trading on a cautious note as investors sat on the fence ahead of F&O expiry later in the day.

The 30-share Sensex was up 76.08 points at 29607.51, while the Nifty was up 15.15 points at 9158.95. The market breadth was healthy as 1,612 shares advanced against a decline of 594 shares, while 163 shares are unchanged.

Adani Ports, State Bank of India and Aurobindo Pharma were top gainers on both the indices, while Axis Bank, Bharti Infratel, Idea Cellular and Bharti Airtel were the top losers.

Larsen and Toubro was up nearly a percent after L&T Construction won orders worth Rs 4,000 crore.

“L&T Hydrocarbon Engineering Ltd, a wholly-owned subsidiary of Larsen & Toubro, has won orders totalling close to Rs 4,000 crore in the international market,” L&T said in a BSE filing.

10:53 am Market Outlook: Macquarie Securities Group believes that the risk reward is in favour of investors and one could look at domestic stories in the current set-up with a measured approach.

There are headwinds in case of export stories due to political uncertainty and regulatory issues, Sandeep Bhatia, Head-Equity, India, Macquarie Securities Group told CNBC-TV18.

10:42 am Gold falls: Gold prices fell on Thursday as the dollar strengthened, but uncertainty surrounding the impact of Britain’s departure from the European Union and the upcoming French elections offered some support.

Gold is witnessing a correction after failing to break above its 200-day moving average around the $ 1,260 level, analysts said.

“But prices are not likely to witness a big drop particularly because of the Brexit and French elections as they (are offering) very good support for gold at this time,” said Brian Lan, managing director at gold dealer GoldSilver Central in Singapore.

10:15 am Buzzing Stock: Share price of Sadbhav Engineering added 2.4 percent intraday as it has signed EPC agreement with its step down subsidiary for Rs 855 crore.

The company has signed an EPC agreement with its step down subsidiary Sadbhav Bangalore Highway worth Rs 855 crore for maintenance and repair works during the development and construction period.

The construction work will be carried out on BRT Tiger Reserve Boundary to Bangalore section of NH-209, a length of 170.92 kms.

9:50 am Market Update: Benchmark indices gained strength in morning, with Nifty trading above record closing high of 9160.

The 30-share BSE Sensex was up 102.83 points at 29,634.26 and the 50-share NSE Nifty gained 24.70 points at 9,168.50.

More than three shares advanced for every share falling on the BSE.

SBI extended gains, rising 1.6 percent followed by Reliance Industries, ITC, L&T and HDFC Bank.

9:45 am FII View: Simon Weaver of Morgan Stanley says portfolio flows in a subset of emerging markets countries have been surging, with inflows totalling USD 26.6 billion in 2017 so far.

Equity has driven this trend, seeing 60 percent of the total inflows, he adds.

Simon says, however, debt has also seen strong inflows, amounting to USD 10.8 billion.

In terms of countries, Taiwan, Korea and India have been the primary drivers of equity inflows while Mexico and India have driven most of the debt inflows, he adds.

9:29 am Buzzing: Shares of Navneet Education was up more than 12 percent intraday as investors cheered the positive brokerage view on the stock.

Motilal Oswal initiated coverage with a buy call and a target price of Rs 210 on the stock. The brokerage house believes that it is well poised to gain market share in the growing CBSE market. Change of syllabus provides strong growth triggers over two years.

In terms of market positioning, it feels that Navneet dominates the market for supplementary educational material and this domineering position makes it a key beneficiary.

Also read – Buy, sell, hold: These 3 stocks are on analysts’ radar today

9:15 am Market Check: Equity benchmarks started off trade on a flat note Thursday ahead of expiry of March futures & options contracts. However, the broader markets outperformed benchmarks.

The 30-share BSE Sensex was up 39.50 points at 29,570.93 and the 50-share NSE Nifty gained 3.65 points at 9,147.45. About 824 shares advanced against 244 declining shares on the BSE.

SBI, Reliance Industries, Hero Motocorp, Adani Ports, BHEL, Bank of Baroda and IndusInd Bank were early gainers while Axis Bank, Tata Motors, Bharti Airtel, M&M, TCS, HCL Tech and Bharti Infratel were losers.

The Indian rupee extended gains today, opening at 64.87 against the US dollar, up 3 paise over 64.90 level in previous session.

Mohan Shenoi of Kotak Mahindra Bank says macro data emanating from US continues to be robust keeping the dollar strength intact. The rupee is resilient on the back of FII flows into bonds and equity, he adds.

He expects the USD-INR to trade in a range of 64.80-65.10/dollar for the day.

The dollar hovered near a one-week high against a basket of currencies, buoyed by a weaker euro which sagged as prospects of the European Central Bank stepping away from monetary easing faded.
Asian shares fell after a mixed start, amid uncertainty over the UK’s exit from the European Union, as the dollar strengthened and crude oil prices slipped.

Ramesh Sridharan

Ramesh Sridharan

Ramesh Sridharan is our Stock Market Correspondent covering events and daily movements of stock markets in Asia. He is based in Mumbai

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