Market Live: Sensex drops 500 pts, Midcap dips 2%; IT rebounds, Asia down 3-5%
12:19 pm Order Win: MEP Infrastructure Developers in joint venture with LongJian Road & Bridge Company has emerged as a preferred bidder (L1) by National Highways Authority of India for the three Hybrid Annuity Mode Projects viz.(i) AUSA CHAKUR PROJECT-four laning of Ausa- Chakur Sec of NH-361 with bid cost of Rs 848.63 crore (ii) CHAKUR LOHA PROJECT-four laning of Chakur-Loha Sec of NH-361 in Maharashtra on HAM with bid cost of Rs 1,001.10 crore and (iii) LOHA WARANGA PROJECT-four laning of Loha-Waranga Sec of NH-361 with bid cost of Rs 1,073.10 crore.
The construction period for all three projects are 2 years from the appointed date. The concession period for all three projects is 15 years (excluding construction period of 2 years).
12:10 pm Parliament Disruption: The Rajya Sabha could not
transact any business for the 15th straight day, as opposition
parties continued to create ruckus, forcing adjournment of
proceedings.
Chairman M Venkaiah Naidu adjourned the Rajya Sabha for
the day but not before expressing anguish over the House not
doing any business since it met on March 5.
Naidu said past disruptions should not be cited to justify the “present wrong” and voiced hope the government will take the opposition into confidence to ensure the House functions next week.
Andhra parties, including the TDP, and KVP Ramachandra Rao of the Congress trooped in the Well today shouting slogans for special status to the state while Tamil Nadu parties – DMK and AIADMK- raised the Cauvery water issue.
12:05 pm Market Outlook: Deven Choksey of KR Choksey Securities told CNBC-TV18 that the negative sentiment is refraining retail investors from participating in the market.
For long term investors opportunities are plenty in the market, given the strong earnings visibility for next 6-8 quarters.
Life insurance business, commercial vehicle, housing finance, electrical goods and equipment segments are good for investment.
As far as long term trade is concerned, technically in the market anything is possible, but capitulation with multiple headwinds can pull the market down to 9,750 on the Nifty but fundamentals are not supporting the fall.
People are sitting on cash, once this correction settles down they will come.
With trade concerns, nobody is scared now. In fact people are asking for opportunities in the falling market and there are opportunities available.
12:01 pm IPO Subscription: The public issue of ICICI Securities has been subscribed 31 percent so far on second day.
The IPO has received bids for 1.37 crore equity shares against issue size of 4.42 crore shares, as per data available with the NSE.
11:58 am US Spending Bill: The US Senate passed a USD 1.3 trillion federal spending bill in dramatic dark-of-night fashion early today, overcoming hurdles that threatened to send the government into its third shutdown of 2018.
Lawmakers stared down a self-imposed deadline of midnight today, when federal funding was set to expire, and passed the mammoth package by a vote of 65-32, with hours to spare.
It now goes to the White House to be signed by President Donald Trump, whose aides have said he supports the bill.
11:52 am Market Outlook: Siddhartha Khemka,VP – Head of Research (Retail), MOFSL said, “Indian equity markets reacted negatively, in-line with global markets. With US imposing fresh tariff targeted China, there is an increasing fear of a trade war which could impact economic growth.”
He expects markets to remain volatile ahead of F&O expiry next week, as well as end of Indian financial year (last week before the LTCG tax kicks in).
While traders should remain cautious, decline in good fundamental stocks would offer buying opportunities for long term investors, he advised.
11:41 am Market Update: Bears continued to have dominant position in the market as the 30-share BSE Sensex was down 450.25 points or 1.36 percent at 32,556.02 and the 50-share NSE Nifty declined 140.50 points or 1.39 percent to 9,974.30 on US-China trade war concerns.
Midcaps continued to underperform frontliners, with the Nifty Midcap index falling 2 percent on US-China trade war concerns.
The market breadth was largely in favour of declines as about 7 shares declined for every share rising on the BSE.
Asian markets like Nikkei, Shanghai, Hang Seng, Kospi were down between 3-5 percent.
11:35 am Fundraising: Jindal Steel and Power (JSPL) plans to raise Rs 1,200 crore through qualified institutional placement (QIP) and has set an issue price of Rs 233 per share.
The company proposes to issue and allot up to 51,502,145 equity shares at an issue price of Rs 233 per share aggregating to a total issue size of approximately Rs 1,200 crore, JSPL said in a filing to BSE.
JSPL has presence in steel, power, mining and infrastructure sectors. The company operates coal-based sponge iron plant and has an installed capacity of 3 MTPA (million tonnes per annum) of steel at Raigarh in Chhattisgarh.
11:30 am NCLT approves demerger: The Hon’ble National Company Law Tribunal, Mumbai Bench (NCLT) approved the composite scheme involving demerger of Commodity API business of Strides and Human API Business of SeQuent into Solara.
11:20 am Market Outlook: Anita Gandhi Whole Time Director at Arihant Capital Markets said, “Indian Equities fell sharply following clues in global equities, after US President imposed trade tarrifs on China amid concerns that trade war could adversly affect global growth.”
“Indian macros have improved over last 3/4 quarters. Our markets will see improvement as we get into earnings season. However, there could be volatility in near term owing to global concerns. ”
11:15 am FII View: Morgan Stanley feels the impact of tariffs on China by US is largely in-line with Section 301 scenario.
EU, Argentina, Australia, Brazil & Korea now exempted from steel & aluminium tariffs.
Initial estimate is that around 50 percent of steel & aluminium imports are now still subject to tariffs.
11:05 am Stake Buy: Promoter has purchased 2.7 lakh shares of Apollo Tyres via open market from March 19-20, 2018.
11:00 am Technical Outlook: Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in said, “Oflate substantial damage was already done to the markets and hence shorting at these leves may not be the right strategy as in our opinion markets are trading at critical support levels placed in the zone of 10040-9980 levels. However, as negative sentiments in global markets are strengthening day by day, a close below 10,000 may extend this downsing towards bigger targets of 9700 levels as of now.”
“As our technical research conclusions on long term trends are suggesting that this is a multi month correction inside a long term bull market and in this correction, as indices are already down by 10% it should be made use by the long term investors as an opportunity to create or reshuffle their portfolios. Beyond 9700 levels we are not looking at substantial price damage but there is going to be a time wise correction for couple of months.”
“Once it bottoms out this bull market has one more leg on the upside which should eventually take it beyond 11200 kind of levels over a period of time may be in next 9-12 months,” he added.
Here are the top headlines at 11 am from Moneycontrol News’ Sakshi Batra
10:50 am Market Update: The US-China trade war concerns spooked not only global markets but also India, with the Nifty trading below the psychological 10,000-mark.
The 30-share BSE Sensex was down 397.03 points or 1.20 percent at 32,609.24 and the 50-share NSE Nifty fell 128.25 points or 1.27 percent to 9,986.55.
More than six shares declined for every share rising on the BSE.
All sectoral indices were in the red, but only IT is exceptional, trading mildly in the green.
The correction in midcaps was more than frontliners, with the Nifty Midcap index falling 2 percent.
10:40 am Management Interview: “Totem Infra owed bank Rs 1,400 crore along with interest overdue, but there is no impact from Totem case on bank,” Rajkiran Rai G, Managing Director & CEO, Union Bank of India said in an interview to CNBC-TV18.
Totem Infra could not execute projects which led to defaults in loans, he reasoned.
Rai G said the process of filing the case is on since 2017 and the bank has provided 100 percent for Totem Infra case & is seeing recoveries as well.
Serious scrutiny is taking place on all accounts under non-performing assets, he said, adding the bank has an exposure of Rs 12,466 crore to NCLT accounts.
He said the entire slippages in Q4 will be from stressed assets and total stressed assets are at 16 percent of the book. Exposure in SDR & S4A is at Rs 4,500 crore, he added.
“We have exposure of Rs 7,658 crore to RBI’s first list of defaulters,” Rai G.
10:35 am FII View on Trade War: The US’ proposed 25 percent tariffs on USD 50 billion of imports from China are below expectations, said Nomura which believes actions in last week suggest overall US trade policy risks have waned modestly.
Trump administration may still become more aggressive on trade, according to him.
10:30 am Market Outlook: Sanjeev Prasad of Kotak Institutional Equities said the market should be looked at on the basis of stocks and high quality stocks continued to remain richly valued.
In last 2 months, domestic political instability has also increased but it doesn’t look like the worst case situation is factored in, he feels.
Cool-off in oil prices, resolution of Insolvency & Bankruptcy Code cases could provide upside triggers, he believes.
“It looks like we are in the dead zone for now and we might see banking stocks bouncing back sharply,” Prasad said in an interview to CNBC-TV18.
There is tremendous value in corporate facing banks like ICICI Bank, he believes.
“We need to track GST revenue for next 2-3 months. Currently these numbers are falling short of the targets,” he said, adding macros are very unclear at this point.
Pick-up in GST collections will boost bond market sentiment, he feels.
10:20 am Rupee Trade: The rupee depreciated by 3 paise to 65.14 against the US dollar on sharp losses in global equity markets after US President Donald Trump imposed USD 60 billion of tariffs on Chinese imports.
Trump yesterday directed the US trade representative to level tariffs on about USD 60 billion worth of Chinese imports after a seven-month investigation into the intellectual property theft, which has been a longstanding point of contention in US-China trade relations.
Yesterday, the rupee had ended 10 paise higher to close at 65.11 against the US currency on foreign fund inflows after the US Federal Reserve stuck to its outlook of three rate hikes this year.
10:12 am Pharma firms don’t need NOC for export: To ensure ease of doing business, the Central Drugs Standard Control Organization (CDSCO) has waived the provision of procuring “no-objection” certificate (NOC) by pharmaceutical companies for exporting drugs, medical devices and cosmetics across ports in the country.
Previously, licensed manufacturers of drugs and medical devices could export them only to the US, Canada, Japan, Australia and the European Union.
In a notice issued on Wednesday, the CDSCO said the NOC for licensed manufacturers will be waived if “shipping bills” submitted by the manufacturer include a copy of its “valid licence”.
“This is being done to bring ease in drug regulatory practices in India relating to export of drugs, medical devices and cosmetics. All the stakeholders are, however, required to comply with the regulatory requirements of the importing countries as per their specific needs,” the notice read.
10:05 am China’s trade war plan: China unveiled plans today to impose higher tariffs on USD 3 billion worth of American goods including pork and pipes in retaliation to US tariffs on steel and aluminium imports from Beijing, authorities said.
The measures suspending tariff concessions will target 128 US products including pork, wines and seamless steel tubes, the Ministry of Commerce said in a statement.
According to the ministry, the measures will include a 15-per cent tariff on products including fruits, nuts, wines and seamless steel tubes, and a 25-percent tariff on pork and recycled aluminium products.
The measures will be implemented in two stages.
Here are the top headlines at 10 am from Moneycontrol News’ Anchal Pathak
10:00 am Listing: Defence company Bharat Dynamics share price listed at around Rs 364 on the NSE, falling 15 percent from issue price of Rs 428.
The Rs 960-crore issue was oversubscribed 1.30 times. Price band for the company’s IPO has been fixed at Rs 413-428.
9:59 am FII View: Paul Kitney, Daiwa Capital Markets told CNBC-TV18 that, “What we have seen so far is a series of selected targeted tariffs rather than a full scale trade war that would benefit neither US or China. A trade war would benefit no one, but it would be particularly bad for China than US. It is not in its interest to respond aggressively, but for political reasons, they have to do this.”
“Right now top of the list of investments is is China. We are overweight China and India and Korea and Hong Kong.”
9:55 am CLSA’s take on Trade War: Chris Wood of CLSA feels the stance on trade, if pursued by the Trump administration, can make more waves in financial markets.
Most likely outcome is that China will agree to some form of compromise, he said.
According to him, Beijing is unlikely to play hard ball in terms of threatening to sell treasury bonds. Trump may be satisfied personally if he can say he delivered a ‘better deal’ with China.
9:50 am IPO pre-Opening rate: Bharat Dynamics share price settled at Rs 370 on the National Stock Exchange in pre-opening trade against issue price of Rs 428.
9:45 am FII View: “The US move seems to be more of a negotiating tactic with China and the global markets seem to have overreacted a little bit w.r.t recent developments,” Shane Oliver of AMP Capital Investors said in an interview to CNBC-TV18.
He thinks Trump wants to extract a deal with China. “We are seeing exemptions coming through on steel, amongst others.”
It is not in Trump administration’s interest to wage a trade war, he said.
According to him, the possible trade war will hit more to emerging markets than developed markets.
“So far for India the impact is relatively moderate & measured and we are not concerned about direct impact on India as of now,” Oliver said, adding India for many years was over valued versus other markets but that over valuation of has now reduced.
“We are looking to buy India, but not yet,” he said.
9:38 am Bhushal Steel in focus: Tata Steel is identified as the successful resolution applicant for acquisition of Bhushan Steel.
The steel maker accepts letter of intent for Bhushan Steel under Corporate Insolvency Resolution Process and Insolvency & Bankruptcy Code.
Committee of creditors has finalised Tata Steel as resolution applicant for Bhushan Steel subject to regulator nod.
9:31 am Morgan Stanley’s take on Trade War: The US has rolled back some tariffs on other countries which is a positive and measures announced By Donald Trump are less aggressive than what we feared, said Chetan Ahya, Co-Head of Global Economics & Chief Asia Economist at Morgan Stanley in an interview to CNBC-TV18.
He believes this is going to have moderate impact on trade & growth. Previous experiences indicate impact of global trade war is not severe, he believes.
“We need to see if this a move to eventually negotiate with China on tariffs,” he said.
He further said US seems to have taken a targetted approach w.r.t Indian subsidies.
9:25 am FII View: “We expect the Chinese to compromise w.r.t tariff imposition by US. For now, we expecting tariff move against China to have only a modest impact,” Shaun Rein, Founder – CMR and Author of the War For China’s Wallet said in an interview to CNBC-TV18.
He feels, the fear of full blown trade war is exaggerated and he expects both US & China to be pragmatic.
9:19 am Gainers & Losers: ICICI Bank, HDFC Bank, Reliance Industries, Vedanta, HDFC, Axis Bank, L&T, SBI, Tata Motors and Yes Bank slipped up to 3 percent while GAIL was the only gainer among Nifty50 stocks.
The market has recovered a bit from day’s low and bulls are trying hard to defend 10,000 level.
The 30-share BSE Sensex was down 365.35 points or 1.11 percent at 32,640.92 and the 50-share NSE Nifty fell 115.65 points or 1.14 percent to 9,999.15.
9:15 am Market Opening: Benchmark indices opened sharply lower on Friday, tracking steep fall in global peers on US-China trade war worries.
The Sensex fell more than 450 points and the Nifty breached 10,000-mark for the first time in 2018.
About 25 shares declined for every share rising on the NSE.
HCC, Union Bank, Reliance Communications, Bank of Baroda, PNB, Bank of India, Canara Bank, IVRCL, GMR Infrastructure, Nalco, JSPL and SAIL fell up to 7 percent.
9:14 am FII View: Richard Harris, Chief Executive, Port Shelter Investment Management told CNBC-TV18 that equity market is pricing in the bad news w.r.t possible trade war and equity markets are doing what they should be doing.
“You have to be bullish on US equities. I think there is still a goldilocks scenario in the US economy,” he said.
Jahangir Aziz, Asia Economic Research at JPMorgan expects value of all items under higher tariffs should be USD 50 billion.
“We need to see what items US imposes tariffs on with their aggregate value. US’ next move on IP protection is going to be significant to track,” he said.
9:10 am Market Update: Benchmark indices settled with more than 1 percent loss in pre-opening trade.
The 30-share BSE Sensex was down 355.38 points or 1.08 percent at 32,650.89 and the 50-share NSE Nifty was down 146 points or 1.44 percent at 9,968.80.
9:05 am Crude Impact: Daniel Hynes, Senior Commodity Strategist at ANZ Research said global trade moves could have wide ramifications for the oil market.
Oil could spike higher due to declining inventories & geopolitical risk, he feels.
Brent crude futures were up 0.93 percent at USD 69.55 a barrel while US crude futures rose 1.09 percent to USD 65 a barrel.
9:02 am Market Pre-Opening: Benchmark indices slipped sharply in pre-opening trade, following global weakness after US-China trade war concerns.
The Nifty fell below 10,000 levels for the first time since October 12, 2017.
The 30-share BSE Sensex was down 291.80 points at 32,714.47 and the 50-share NSE Nifty fell 149.90 points or 1.48 percent to 9,964.90.
8:55 am Nomura on Trade War: Lewis Alexander of Nomura told CNBC-TV18 that Donald Trump’s bark has been worse than his bite’ as recent developments are risky & can spiral out of control.
“We have seen a desire by US’ partners like Europe & China to be proportional. If retaliation is proportional, then don’t think this is a disaster,” he said.
Trump administration has crossed lines that have never been crossed before, he feels.
8:50 am FII View: Ken Peng of Asia Pacific Investment Strategist at Citi Private Bank told CNBC-TV18 that MSCI China’s exposure to US export revenue is 3 percent and Chinese listed companies’ revenue exposure to US is limited.
Hence, US’ move on China tariff does not have to result in a bigger trade war, he feels.
He expects further downside in global markets for the near-term and doesn’t expect this trade issue to be resolved very quickly.
He further expects intense volatility in global markets in the coming months.
Coming back to India, fiscal worries are not resolved yet, he said, adding the collateral damage in Indian & European markets should reverse.
“Its bit early to draw the conclusion that it’s time to buy into India,” Peng said.
8:40 am Japan’s close watch on trade war: Japan said it would closely watch US’ moves on China tariffs and would keep seeking exemptions from US import tariffs.
“We want to closely communicate with US over trade as retaliation against US trade measures could destroy free trade system,” it said, adding it would consider necessary steps within WTO Framework.
8:30 am China’s take on Trade War: China Commerce Ministry said we resolutely oppose US unilateralism, protectionism w.r.t Section 301 probe.
China has fully made preparations to defend its legitimate interests and doesn’t want a trade war but is not afraid of one.
“We hope US to be prudent in its decisions & will pull back ‘from the brink’,” he said. China urges US not to take bilateral trade relations to a ‘Dangerous Place’.
8:25 am Technical Recommendations: Here’s what Ways2Wealth Brokers has to recommend:
BPCL: Sell around 420 – 425| Target 385 – 370| Stop Loss 439| Timeframe 15 to 21 sessions| Return 10%
Ashok Leyland: Sell around 144 – 146| Target 136 – 132| Stop loss 149| Timeframe 15 to 21 trading sessions| Return 7%
Persistent Systems Ltd: Buy around 785 – 780| Target 875| Stop loss 740| Timeframe 15 to 21 trading session| Return 11%
Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are his own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
8:15 am Stocks in news: United Spirits will consider sub-division of equity shares.
Indraprastha Gas announced reduction in CNG price in Uttar Pradesh.
Idea Cellular says existing leadership teams will continue to manage their separate businesses.
CBI registered a case on a complaint filed by Union Bank of India against Totem Infra.
Tata Sons appointed Tanmoy Chakrabarty as its government affairs officer.
Hero Motocorp has hiked stake in Colombian joint venture to 68 percent.
Also Watch: Markets@Moneycontrol: Nifty likely to open gap-down; 3 stocks which can give up to 11% return
8:00 am Market Check: Indian indices are likely to see big gap down opening on Friday, tracking global weakness on US-China trade war concerns.
The SGX Nifty is also indicating the negative opening for the Indian market, falling 119 points at 9,998.50.
Asian markets fell sharply, tracking the steep fall on Wall Street and European markets, which took a hit on fears of a potential trade war.
US stocks dropped on Thursday, as Dow Jones industrial average slipped 724 points, down 2.9 percent to 23,957.89, which is a biggest decline since February 8. The Standard & Poor’s 500 fell 2.5 percent to 2,643.69 and Nasdaq Composite declined 2.3 percent at 7,166.68.
Trump signed a presidential memorandum on Thursday that could impose tariffs on up to USD 60 billion of imports from China, although the measures have a 30-day consultation period.
Investors fears that China may retaliate with its own tariffs that could escalate into a trade war, with potentially dire consequences for the global economy, reported Reuters.
Global trade war concerns a day after Fed’s message on 3 rate hikes push dollar index to one-month low. While the yen hit a 16-month high against the dollar as traders seek safety in the Japanese currency. The Hong Kong dollar fells to a new 33-year low.
