Market Live: Sensex, Nifty extend rally; Midcap up 1%; Infosys, PSU banks in focus
1:10 pm Market Check: Following a gap-up opening on the market, benchmark indices held on to those gains in the afternoon session.
The Sensex was up 141.05 points at 31432.90, while the Nifty was up 35.55 points at 9801.10. The market breadth was positive as 1,492 shares advanced against a decline of 850 shares, while 110 shares were unchanged.
Dr Reddy’s Laboratories, Infosys and GAIL were the top gainers, while HUL, TCS, Tech Mahindra and Tata Power lost the most.
12:37 pm Europe trade: European markets opened slightly lower, as traders paused for breath after a global rally spurred by gains for tech shares on Wall Street.
The pan-European Stoxx 600 edged 0.14 percent lower shortly after the opening bell with almost all sectors and major bourses in negative territory.
12:24 pm Market Check: Equity benchmarks as well as broader markets extended rally in afternoon trade after Infosys and PSU banks gained strength.
The 30-share BSE Sensex Sensex was up 189.35 points at 31,481.20 and the 50-share NSE Nifty rose 51.60 points to 9,817.15 while the BSE Midcap and Smallcap indices gained 1 percent each.
About two shares advanced for every share falling on the BSE.
Infosys added nearly 3 percent intraday after reports emerged that former executive Nandan Nilekani is likely to return at the helm of affairs at the company.
12:10 pm PSB merger: Cabinet has approved setting up alternative mechanism for PSU bank merger and gave in-principle approval for next level of merger, reports CNBC-TV18 quoting sources.
Group of ministers will be formed on the basis of alternative mechanism and then name of banks for merger will be submitted to group of ministers.
According to sources, name of banks to be merged will be decided on four major points.
One is that banks to be merged should cover similar regions and the second is that asset quality & capital adequacy of banks to be merged should be comparable.
Profit of banks to be merged will also be considered, sources said.
Banks will be merged under Section 9(2)(c) & 9(6) of Banking Companies (Acquisition & transfer of Undertakings) Act. All banks except SBI & IDBI come under this section.
11:55 am Expert Speak: Real estate is in focus as a Knight Frank report indicates that real estate launches crash to the lowest level in seven years in the first half of 2017 whiles sales volumes are down to the lowest in five years.
In an interview to CNBC-TV18, Gulam Zia, Executive Director of Knight Frank spoke at length about the sector. Zia said price is not just a matter of volumes alone and depends on wealth creation.
We have seen reduction in size of apartments, said Zia. Ultimately, buyer looks at a ticket size and not the price per square feet, he added.
11:35 am Market Check: Benchmark indices were trading steady after witnessing a gap-up opening on Wednesday, with the Nifty trading around 9800-mark.
The Sensex was up 147.20 points at 31439.05, while the Nifty was up 38.10 points at 9803.65. The market breadth was positive as 1,455 shares advanced against a decline of 713 shares, while 106 shares were unchanged.
Dr Reddy’s continued to gain for the second consecutive session. Other gainers included Bharti Airtel and GAIL. Meanwhile, HUL, TCS, Tech Mahindra and Eicher Motors were the top losers.
11:05 am Market Expert: After scaling to new peaks in the recent past, the Indian market entered a consolidation and corrective phase, with the Nifty slipping to 9800-levels from its highs of 10,100.
Signalling that the move is largely due to a huge run up in valuations not being proportionate with earnings, Ambit Capital believes that a degree of realism among excited circumstances is a good approach.
“We have been realistic of markets and earnings growth,” Saurabh Mukherjea of Ambit Capital told CNBC-TV18 in an interview. Having said that, he is unsure whether this fiscal year is the year of recovery in earnings per share (EPS) as well.
10:45 am Buzzing: Realty major DLF rallied 7 percent in morning as the company will hold a board meet on August 25 to decide on promoters’ proposal to sell their 40 per cent stake in its rental arm to investment firm GIC in a deal estimated at around Rs 13,000 crore.
In October 2015, DLF had announced that its promoters — K P Singh and family — would sell their entire stake in the DLF Cyber City Developers Ltd (DCCDL), which holds the bulk of commercial assets of the group.
The promoters, who hold Compulsorily Convertible Preference Shares (CCPS) in DCCDL, had in March this year entered into an exclusivity pact with Singapore’s sovereign wealth fund GIC to negotiate on this transaction.
In a regulatory filing, DLF informed that a meeting of the audit committee will be held on August 25 to “consider and review the status of the proposed sale of CCPS held by CCPS holders to a GIC affiliate including the key terms and conditions and make appropriate recommendations to the board”.
10:25 am Bharti Airtel in focus: Four private telecom operators, including Idea Cellular and Vodafone, lost 43.7 lakh customers while Bharti Airtel added 6 lakh new users in July 2017, the data published by industry body COAI showed.
Total mobile customer base of five COAI members that include Aircel and Telenor declined by 37.74 lakh to 82.6 crore in July from 83 crore at the end of June.
“…the extreme financial stress being experienced by the industry currently is likely to show its impact in these numbers. The industry is undergoing a phase of hyper competition and at the moment it is reeling under a debt of over Rs 4.5 lakh crore,” COAI Director General Rajan S Mathews said in a statement.
He said the industry further needs an additional investment of over Rs 2.5 lakh crore for infrastructure roll- out and expansion are required especially in the far flung areas of the country.
The subscriber base of Bharti Airtel reached 28.12 crore in July.
10:10 am Market Check: Equity benchmarks as well as broader markets continued to trade higher in morning despite weakness in Asian peers.
The 30-share BSE Sensex was up 137.35 points at 31,429.20 and the 50-share NSE Nifty rose 36.95 points to 9,802.50 while the BSE Midcap index was up 0.4 percent and Smallcap gained 0.8 percent.
The market breadth was positive as about 1,315 shares advanced against 551 declining shares on the BSE.
All sectoral indices were positive as Nifty Bank, Auto, FMCG and Pharma gained 0.2-0.7 percent.
9:54 am FII View: In Emerging Asia, three big markets are driving 80 percent of growth, which are China, India and Indonesia, DBS Bank said.
India came nicely with long term growth structure, looks interesting with long term perspective as some global investors are already overweight on India.
Valuations are high as lot of positives already priced in. Hence, some consolidation is likely in short term, it feels.
It expects long term growth reforms and other growth drivers to continue to boost economy.
DBS Bank said urbanisation and industrialisation led by foreign investment are two important structural growth drivers for India
9:40 am FII investment limit: Eris Lifesciences shares rallied as much as 3.6 percent in morning trade after the Reserve Bank of India gave approval for increase in FII investment limit.
The Reserve Bank of India on Tuesday notified that foreign institutional investors (FIIs)/foreign portfolios investors (FPIs) investment limit under portfolio investment scheme in pharmaceutical company has increased from 24 percent to 49 percent of its paid up capital.
Further, it has also notified that the NRI (non-resident Indian) investment limit under portfolio investment scheme in the company has increased from 10 percent to 24 percent of its paid up capital.
Eris Lifesciences already passed necessary resolutions of its board of directors and general body as required under the FEMA.
9:30 am Buzzing: Shares of Balaji Telefilms advanced 4 percent as the company has approved the stake sale to Reliance Industries (RIL).
The company in its board meeting held on August 22, has approved the allotment of 2.52 crore equity shares at a price of Rs 164 for a total consideration of Rs 413.28 crore to Reliance Industries on preferential basis through a private placement.
The company has got shareholders’ approval in the extra ordinary general meeting held on August 16, 2017.
RIL board last month approved to pick up around 24.92 percent stake in the company by acquiring 2.52 crore shares for around Rs 413 crore.
Disclosure: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.
9:25 am FII View: Market is in a modest consolidation phase, but I do not expect a major correction, said Geoffrey Dennis, Head-Global Emerging Market Strategy at UBS in an interview to CNBC-TV18.
Overweight on India amongst our global emerging market portfolio, said Dennis.
He expects 12 percent earnings per share (EPS) growth in FY18 and 15 percent EPS growth in FY19 for India.
9:15 am Market Check: Benchmark indices opened on a positive note, with the Nifty trading above 9800-mark in the opening tick amid consolidation.
The 30-share BSE Sensex was up 116.55 points at 31,408.40 and the 50-share NSE Nifty rose 35.15 points to 9,800.70.
Nifty Midcap Index gained 0.7 percent on positive market breadth. About four shares advanced for every share falling on the BSE.
Fortis Healthcare, DLF, Balaji Telefilms, BEML, HPCL, IOC, Gati, Eris Lifesciences, Patel Integrated, Snowman Logistics, Future Consumer, Indian Toner and Indo Count rallied up to 5 percent.
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