MARKET REPORT 2.50AM 9 MARCH 2016

Nifty fails to hold 7500, Sensex ends flat amid weak global cues Index heavyweights Reliance Industries, ITC and HDFC supported equity benchmarks while banks, infra and select technology stocks saw selling pressure. 16:04 Moneycontrol Bureau The market started off truncated week on a flat note. The Nifty failed to hold 7500-mark amid choppy trade and weak global cues. Index heavyweights Reliance Industries, ITC and HDFC supported equity benchmarks while banks, infra and select technology stocks saw selling pressure. It was a consolidation day after more than 6 percent rally last week. The 30-share BSE Sensex rose 12.75 points to 24659.23 while the Nifty fell 0.05 points to 7485.30. The broader markets too ended flat. Nilesh Shah of Kotak Mutual AMC says the Nifty is unlikely to revisit lows of 6800 unless catastrophic events take place. He advised clients to be marginally overweight on equities post Budget. Global markets saw consolidation and profit taking after last week's rally. European markets like CAC and DAX fell 1.6 percent each followed by FTSE with 1 percent loss while in Asia, Hang Seng and Nikkei declined more than 0.7 percent each. However, Shanghai bucked the trend, closing in green despite exports fell 25.4 percent in February, the biggest fall since 2009. Oil prices edged lower today after Kuwait said it would only agree to an output freeze if all major producers take part and Goldman Sachs analysts poured cold water over the prospects for a sustained rally. Brent crude futures fell 0.6 percent to USD 40.6 a barrel. Meanwhile, Finance Minister Arun Jaitley says the government has withdrawn (Budget) proposal to tax Employee Provident Fund but retained tax proposal for NPS.

 
 
 

Commodities stocks saw buying interest today. In oil space, Reliance Industries was the leading contributor to Sensex's gains, up 2 percent and GAIL gained 2.5 percent. Sugar stocks like Balrampur Chini, Dwarikesh Sugar & Dalmia Sugar hit 52-week high, rising 7-17 percent. Metals stocks like Tata Steel, Vedanta and Hindalco rose 1-5 percent on surge in iron ore prices. Lupin shares climbed 2 percent as Nomura upgraded the stock to buy from neutral, saying generic Fortamet and Glumetza (diabetes medicines) offer strong near-term earnings support to the company. The brokerage also increased target price to Rs 2,110 apiece from Rs 2,080 earlier, implying 19 percent potential upside. Natco Pharma was up 1.7 percent as Kotak Securities has initiated buy on the stock with a target of Rs 563 (implying a 17 percent upside), citing strong hepatisis C portfolio and US revenue. Maruti Suzuki lost 3 percent. The company launched compact SUV Vitara Brezza today, the first launch of 2016. SBI was down 2.5 percent. Debt Recovery Tribunal has passed orders on SBI's plea, saying Diageo cannot disburse money to Vijay Mallya till March 28 and Mallya can't withdraw USD 75 million settlement received from Diageo till case disposed off. Among others, ITC and HDFC gained more than 1.5 percent while ICICI Bank, HUL, Axis Bank, Cipla and Hero Motocorp fell 1-2.5 percent.
 
 

Nifty fails to hold 7500, Sensex ends flat amid weak global cues Index heavyweights Reliance Industries, ITC and HDFC supported equity benchmarks while banks, infra and select technology stocks saw selling pressure. 16:04 Moneycontrol Bureau The market started off truncated week on a flat note. The Nifty failed to hold 7500-mark amid choppy trade and weak global cues. Index heavyweights Reliance Industries, ITC and HDFC supported equity benchmarks while banks, infra and select technology stocks saw selling pressure. It was a consolidation day after more than 6 percent rally last week. The 30-share BSE Sensex rose 12.75 points to 24659.23 while the Nifty fell 0.05 points to 7485.30. The broader markets too ended flat. Nilesh Shah of Kotak Mutual AMC says the Nifty is unlikely to revisit lows of 6800 unless catastrophic events take place. He advised clients to be marginally overweight on equities post Budget. Global markets saw consolidation and profit taking after last week's rally. European markets like CAC and DAX fell 1.6 percent each followed by FTSE with 1 percent loss while in Asia, Hang Seng and Nikkei declined more than 0.7 percent each. However, Shanghai bucked the trend, closing in green despite exports fell 25.4 percent in February, the biggest fall since 2009. Oil prices edged lower today after Kuwait said it would only agree to an output freeze if all major producers take part and Goldman Sachs analysts poured cold water over the prospects for a sustained rally. Brent crude futures fell 0.6 percent to USD 40.6 a barrel. Meanwhile, Finance Minister Arun Jaitley says the government has withdrawn (Budget) proposal to tax Employee Provident Fund but retained tax proposal for NPS.

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MARKETS REPORT OF 2ND MARCH 2016

Bulls roared again on Wednesday as equity benchmarks posted biggest second-day rally in seven years with the Sensex rising 500 points intraday, driven by banks after the Reserve Bank of India changed rules that determine banks' regulatory capital, and positive global cues. It was in addition to 777-point rally in previous session on hopes of rate cut. The 30-share BSE Sensex surged 463.63 points or 1.95 percent to 24242.98 and the 50-share NSE Nifty climbed 146.55 points or 2.03 percent to 7368.85. The broader markets too traded in line with benchmarks as the BSE Midcap index gained 1.9 percent and Smallcap rose 2.2 percent. About three shares advanced for every share declining on the BSE. Ajay Srivastava of Dimensions Consulting said the current bounceback may have some more legs to go but till economic fundamentals solidly change, investors must be cautious to not over invest. He also said the RBI's move yesterday to tweak capital norms will help banks shore up capital but this may be a followed by another NPA (non-performing assets) hit in the fourth quarter. Street was expecting some rate cut from the RBI after the Union Budget provided sufficient space but the RBI on Tuesday relaxed capital rules for banks to help meet Basel-III norms that will provide additional capital to banking sector. It is a big relief to banks that have been struggling with higher NPA issue. As per the new rules, banks will be allowed to recognise part of their real estate assets, foreign currency assets and deferred tax assets as capital with suitable hair cut. This measure is a big positive particularly for State Bank of India because the bank never had revaluation reserves on balance sheet, Ravikant Bhat of IDBI Capital said, adding other beneficiary could be Corporation Bank. PS Jayakumar, MD & CEO of Bank of Baroda says the Reserve Bank’s new amendments on balance sheet items will help in improving common equity Tier 1 (CET I) by 1.1 percent while Anshula Kant, CFO of State Bank of India (SBI) says that the bank should get upward of 100 basis points (bps) of capital [adequacy ratio]. State Bank of India rallied 11.5 percent followed by ICICI Bank, Punjab National Bank and Bank of Baroda with 7 percent upside. Bank Nifty surged 4.7 percent.




3:30 pm Market Closing: It was a stellar rally in the market on Wednesday, continuing for the second consecutive session. The rally was largely led by banks, especially due to change in rules that determine banks' regulatory capital, which would be big boost to PSU banks that have been struggling with NPA issues. Bank Nifty jumped more than 4 percent. The 30-share BSE Sensex surged 463.63 points or 1.95 percent to 24242.98 and the 50-share NSE Nifty climbed 146.55 points or 2.03 percent to 7368.85. About three shares advanced for every share declining on the BSE. SBI was the biggest gainer on Sensex, up 12.39 percent followed by Hindalco, ICICI Bank, Adani Ports, Hero Motocorp, PNB and Bank of Baroda with 5-7 percent upside while M&M, Coal India, Sun Pharma, ITC and Bajaj Auto were down 1-5 percent. 3:20 pm PF: Amid widespread concerns, Finance Minister Arun Jaitley today said in Lok Sabha that the issue related to the proposal to tax PF will be addressed by him during the discussion on Budget. "We are seized of the problem. I will address it during the Budget discussion," Jaitley said. He was responding when TMC members raised the issue soon after the question House with Saugata Roy demanding that Jaitley, who was in the House, make an immediate announcement. TMC leader Sudip Bandhyopadhyaya said the Budget proposal to tax the EPF has caused nation-wide concern. 2:58 pm Market Update: The Sensex rose 414.52 points or 1.74 percent to 24193.87 and the Nifty climbed 135.50 points or 1.88 percent to 7357.80. About 1923 shares have advanced against 670 declining shares on the BSE. 2:40 pm Buzzing: HCL Technologies shares gained more than 2 percent on five year next–generation IT outsourcing services contract from Sweden-based Husqvarna AB. HCL has been providing application management services to Husqvarna and with this deal, HCL will now provide end-to-end integrated infrastructure and applications services, covering data centre services, network services, security services, applications operations and support services," says the IT company in its filing. Husqvarna AB manufactures outdoor power products including robot mowers, garden tractors, chainsaws and trimmers. "HCL's engagement with Husqvarna is nearly three years old and Husqvarna is marquee customer for the company in Nordics region," it says. 2:30 pm Europe Update: European markets traded higher today, tracking gains in the US and Asia overnight. FTSE, CAC and DAX gained 0.5-1 percent. Markets in Asia were higher, with Japan's Nikkei 225 index leading the way after a strong finish on Wall Street overnight. Giving European markets another reason to be cheerful, major US indexes rose on Tuesday, with the Dow Jones industrial average up 2.11 percent, S&P 500 adding 2.39 percent, and the Nasdaq composite gaining 2.89 percent. 2:15 pm Tata Steel expansion: Tata Steel has received final environment clearance for its Rs 1,877 crore expansion project to be carried out at Jamshedpur Steel Works in Jharkhand. "The Environment Ministry has considered the application based on the recommendations of the Expert Appraisal Committee (Industry-I) and decided to grant environment clearance (EC) to the proposal for expansion of crude steel production at Tata Steel Works," a senior government official said. The EC, which was issued yesterday, has been given to the company subject to strict compliance to specific and general conditions, the official added. Among conditions specified, the official said the company has been asked to take prior permission from the State Forest Department on likely impact of the expansion of the proposed steel plant on the reserve forests. Also read - Govt orders rebidding for Rs 10,050 cr Zojila tunnel in J&K 2:00 pm Market Check Equity benchmarks remained strong in afternoon trade, backed by banks, oil, infra and select auto stocks. The Sensex rallied 429.50 points or 1.81 percent to 24208.85 and the Nifty climbed 141.35 points or 1.96 percent to 7363.65. State Bank of India was the biggest gainer on Sensex, up 9 percent after the RBI on Tuesday relaxed capital rules for banks to help meet Basel-III norms. As per the new rules, banks will be allowed to recognise part of their real estate assets, foreign currency assets and deferred tax assets as capital with suitable hair cut. This measure is a big positive particularly for State Bank of India because the bank never had revaluation reserves on balance sheet, Ravikant Bhat of IDBI Capital said, adding other beneficiary could be Corporation Bank. ICICI Bank, Axis Bank, Adani Ports, Hero Motocorp, NTPC, Hindalco and BHEL rallied 4-6 percent. The market continued to be strong as about three shares advanced for every share declining on the Bombay Stock Exchange.