Sensex, Nifty end flat but Midcap outperforms; metals, realty shine; cement stocks dip
It was a lacklustre session for equity benchmarks after a nearly 600-point rally on the Sensex in previous two consecutive sessions, but broader markets continued to rally on Monday. Investors digested Moody’s India rating upgrade and focussed on global cues.
The upside in oil & gas, select private banks and metals stocks was offset by a fall in ICICI Bank (down 2 percent), SBI (1.3 percent), HDFC (1 percent), Infosys (1 percent) and cement stocks.
The 30-share BSE Sensex ended up 17.10 points at 33,359.90 and the 50-share NSE Nifty rose 15.20 points at 10,298.80 after consolidation.
“After the recent smart upmove, some consolidation cannot be ruled out. Any correction at this juncture should be considered as a buying opportunity,” Jayant Manglik, President – Retail Sales, Religare Securities said.
According to him, some key triggers, which could provide further direction to the markets in the near term include India’s Q2FY18 GDP numbers and RBI monetary policy.
Traders should remain cautious and be selective in stock picking, while investors can continue to accumulate quality stocks on dips, Manglik advised.
The broader markets outperformed benchmarks as the Nifty Midcap and BSE Smallcap indices advanced 0.8 percent each on positive breadth. About three shares advanced for every two shares falling on the BSE.
Amongst the global markets, the Asian stocks ended mixed as investors focussed on US tax reform. European markets were trading flat amid political instability in Germany.
Back home, L&T was up 0.6 percent on bagging Rs 8,650 crore order of Mumbai Trans Harbour Link. The ripple effect also spilled over to Jai Corp (up 20 percent) and Reliance Industrial Infrastructure (up 15 percent).
Yes Bank and IndusInd Bank gained 1-2 percent as Asia Index decided to add both stocks into the BSE Sensex. Lupin (down 0.4 percent) and Cipla (0.7 percent), however, were under pressure on exclusion from BSE Sensex.
Cement stocks caught in a bear trap after the Supreme Court asked all states and Union Territories to consider prohibiting the use of pet coke and furnace oil by industries. UltraTech Cement, Ambuja Cements, ACC, Shree Cements, JK Cement, JK Lakshmi Cement and India Cements were down 2-5 percent. However, Coal India gained 2 percent and GMDC was up 7 percent on likely benefits if pet coke ban happens.
GAIL among Nifty 50 stocks was the biggest gainer, rising 3.5 percent while Reliance Industries, HDFC Bank, Vedanta, Kotak Mahindra Bank and Maruti gained 0.7-2 percent.
Realty stocks remained in focus after increase in carpet area of houses. Puravankara, Kolte-Patil, Oberoi Realty and Indiabulls Real rallied 3-15 percent.
Buying continued in logistics stocks as Finance Ministry has given the nod to give the logistics sector infrastructure status. Gati, Patel Integrated and Transport Corporation gained 2-7 percent.
Eris Lifesciences rallied 7 percent and Strides Shasun gained 4 percent after the deal. Eris has bought Indian branded generic business of Strides Shasun for an aggregate cash consideration of Rs 500 crore.
Biocon rallied 7 percent on getting establishment inspection report from USFDA for Aseptic drug product facility.
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Rajesh Sharma is Correspondent for Stock Market of South East Asia based in Mumbai. He has been covering Asian markets for more than 5 years.