Broader markets outperform Sensex, Nifty; RIL beats TCS in market cap

It was a consolidation day for equity benchmarks that closed marginally higher amid geopolitical tensions on Wednesday, but the broader markets outperformed smartly.

The 30-share BSE Sensex rose 35.77 points to 31,245.56 and the 50-share NSE Nifty was up 24.30 points at 9,637.60, backed by Reliance Industries and ICICI Bank.

Experts feel the rangebound trade is likely to continue at least till the start of June quarter earnings season that will begin next week.

While sticking to Sensex target of 30,000 for December 2017, Sanjay Mookim of Bank of America Merrill Lynch said he is cautious on the market going forward.

He feels the market is expensive in general at the current valuations and there is a struggle in finding overlap between value and growth.

Jayant Manglik of Religare Securities said Nifty needs a decisive break above 9700 for fresh surge which seems difficult at present. He reiterated his view to maintain stock-specific trading approach and use dips to add quality stocks.

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The BSE Midcap and Smallcap indices rallied 1 percent each on positive market breadth. About 1,700 shares advanced against 979 declining shares on the exchange.

Reliance Industries (market cap of Rs 4.68 lakh crore), the leading contributor to Sensex’ gains, surpassed TCS (Rs 4.64 lakh crore) in terms of market capitalisation and became the most valuable company. RIL gains 1.2 percent while TCS fell 0.26 percent.

Lupin was biggest gainer among Sensex stocks, up 3.82 percent after the launch of generic version of Moxifloxacin Hydrochloride Ophthalmic solution in the United States. The drug is used for treatment of bacterial conjunctivitis caused by susceptible strains of the organisms.

Tata Motors gained 1 percent after Morgan Stanley retained overweight rating on the stock with a target price of Rs 588 despite tepid JLR sales growth in US. The auto maker announced reduction in prices of passenger vehicles after GST rollout.

HDFC was down 0.7 percent after it disclosed its exposure of Rs 909 crore in one of the companies identified under Insolvency and Bankruptcy Code (IBC). “No more provisioning required for the Quarter ended June 30, 2017,” it said.

IDFC Bank and IDFC shares gained 10 percent each after sources told CNBC-TV18 that IDFC Bank is likely to announce acquisition of financial services company soon.

Infosys (down 1 percent). While reiterating sell rating on the stock, Goldman Sachs said it lowered FY18 constant currency USD revenue growth to 6.8 percent (prior 7.7 percent) against guidance of 6.5-8.5 percent, as it sees acute pressure in its legacy app service business leading to slower growth in both financials and retail verticals (50 percent of its sales).

M&M rose over 2 percent after the company reduced prices by 6.9 percent of large utility vehicle’s and small utility vehicle’s and small car segment by 1.4 percent post GST.

ITC fell for the second day, down 1.8 percent while ICICI Bank, Asian Paints, ONGC and Axis Bank gained 1-2 percent.

In the broader space, Timken India surged 15 percent and ABC Bearings rallied 20 percent after the decision of merger. Hence, Menon Bearings surged 20 percent and NRB Bearings was up 5 percent.

Shiva Cement was locked at 10 percent lower circuit on profit booking after a solid rally of 62 percent in previous six consecutive sessions.
European markets were mixed due to muted trading activity across the world on Independence Day celebrations in the US, and amid geopolitical tensions. Asian markets closed mostly higher despite geopolitical concerns on the Korean peninsula.