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PremiumOTHERS :Mumbai: Indian benchmark indices BSE Sense and NSE’s Nifty 50 fell nearly 2% on Friday as a selloff in global markets continued for a second day after the US Federal Reserve raised interest rates and signalled more rate hikes. The Sensex slumped over 600 points dragged by heavyweights Infosys, Reliance Industries and HDFC. The Nifty 50 traded below the 10,800 level. All the sectoral indices traded in negative territory. The Indian rupee fell below 70 a dollar and slumped 0.8%.The BSE Sensex closed 689.60 points, or 1.89%, down at 35,742.07, and the Nifty 50 ended 197.70 points, or 1.81%, lower at 10,754. The BSE midcap and smallcap indices fell 1.79% and 1%, respectively. All the sectoral indices on BSE declined, with IT, teck, telecom and consumer durables fell over 2%.On the Sensex, 28 stocks declined, while 3 stock rose. On the 50-share Nifty, 45 stock fell, and 5 stocks ended in positive territory. HPCL, BPCL, Coal India, NTPC and Power Gird were among major gainers on the key indices, whereas Wipro, Adani Ports, Indian Oil and UPL were among top gainers.Further, traders in India are cautious that the government might announce more populist measures to woo voters ahead of 2019 general elections. The government has already exceeded its budgeted annual deficit in October, and populist announcement such as farm loan waivers and tax cuts may lead to fiscal slippage, analyst expects.“Generally, we do see some profit booking towards the end of the year and this time, especially the last couple of days, we have seen Indian markets react to global news," said Anand James, chief market strategist at Geojit Financial Services. “This could add to some volatility but overall we expect Nifty to be rangebound between 10,700 and 11,200 in the short term."In global markets, European shares opened in negative territory, following in the footsteps of US and Asian markets hit by the threat of a US government shutdown and of further hikes in US borrowing costs. Oil prices rose nearly 1%, claiming back ground from a tumble of 5% in the previous session, on signs that OPEC’s output cuts that start next month will be deeper than expected. Here are the latest updates from the markets:
The BSE Sensex closed 689.60 points, or 1.89%, down at 35,742.07, and the Nifty 50 ended 197.70 points, or 1.81%, lower at 10,754.
The government is making efforts to manufacture lithium-ion batteries in India in the next one year, and talks are on between state-run BHEL and a US firm to form a joint venture in this regard, Union Minister Anant Geete said Friday. “Right now we are importing 100 per cent lithium-ion batteries, but efforts are on towards manufacturing them in India within the next one year,” Geete said, adding that talks are on between BHEL and an American firm to form a joint venture for domestic manufacturing of lithium-ion batteries. BHEL shares traded 0.57% down at ₹70.10 per share. PTI
Gautam Adani’s coal mine project in Australia faces another setback, with the Queensland state government refusing to sign off on the company’s plans before further studies into the project’s environmental impact are complete. “Two plans are yet to be approved before any significant disturbance can commence at the Carmichael coal mine,” Queensland’s department of environment and science said in a media release on Friday. Adani Enterprises shares traded 2.2% lower at ₹155.50 per share. Read more
The BSE Sensex traded 527.63 points, or 1.45%, down at 35,904.04, and the Nifty 50 fell 163.40 points, or 1.49%, to 10,788.30. The BSE midcap and smallcap indices were down 1.34% and 0.84%, respectively. Sixteen out of 19 sectoral indices on BSE fell 1.1% to 1.8%.The Indian rupee weakened past 70 a dollar. The currency traded at 70.22 per dollar, down 0.75% from its previous close of 69.7.
The pain across equity markets continued on Friday, with European and Asian stocks retreating in the wake of more losses on Wall Street and U.S. futures showing few signs of a rebound. Major currencies were calmer as bonds in Europe retreated.Futures on the S&P 500 Index dipped 0.2 percent as of 8:05 a.m. London time. The Stoxx Europe 600 Index declined 0.3 percent to the lowest in more than two years. The U.K.’s FTSE 100 Index rose 0.1 percent. Germany’s DAX Index sank 0.5 percent to the lowest in about two years. The MSCI Asia Pacific Index sank 0.5 percent to the lowest in more than 21 months. The MSCI Emerging Market Index climbed 0.2 percent. Bloomberg
“We estimate the company’s consolidated Net Revenue, EBITDA and PAT to grow by 9%, 10.5% & 10% CAGR respectively over FY18-21E, led by better volume offtake in cigarettes, continued healthy traction in FMCG and better growth outlook of other business. Better product mix and cost efficiencies should aid in steady margin gains. The brokerage recommends a “Buy” with target price of ₹337.
Aurobindo Pharma Ltd said it has received final approval from the USFDA to manufacture and market potassium chloride extended release tablets, 8 mEq (600 mg) and 10 mEq (750 mg). The product will be launched in January 2019. Aurobindo Pharma shares traded 0.10% down at ₹725.55 per share.
Workers at India’s state-owned banks called a nationwide strike on Friday in protest at proposed mergers that could cause job losses and demanded immediate wage rises. The strike, by the All India Bank Officers’ Confederation (AIBOC), impacted trading volumes in foreign exchange and debt markets, said traders. The striking officers are responsible for daily operations, causing a complete shutdown of services to customers.Private sector banks were not affected by the strike.The United Forum of Bank Unions (UFBU), an umbrella body of the top nine bank unions in the country, also decided to hold a strike on December 26 against the proposed merger of Bank of Baroda, Dena Bank and Vijaya Bank. Reuters
“In previous market corrections, investors would resort to panic selling, but this time they are using it as an opportunity to buy on dips,” said Kaustubh Belapurkar, director manager - research at Morningstar Investment Adviser India Pvt. “This is a trend that will continue, with investors continuing to stay invested despite volatile markets.” Read more
Shares of Vodafone Idea traded 0.5% up at ₹38.35 per share. In early trade, the stock hit a high of 38.70 per share. UK’s Vodafone Group Plc and its local partner Aditya Birla Group plan to tap private equity (PE) and pension funds to raise as much as $1 billion once they pump in $2.5 billion through a rights issue into Vodafone Idea Ltd, Mint reported, citing three people aware of the talks. Read more
Election years are not easy for the bond market as they tend to render more volatility than in non-election years. But 2019 could prove different if the Reserve Bank of India (RBI) lends a hand. From the RBI’s statement on Tuesday, it looks like the central bank will take big chunks of bonds from the market onto its balance sheet. RBI would have bought ₹2.6 trillion worth of government bonds by January if it sticks to its commitments.
RBI would have bought ₹2.6 trillion worth of government bonds by January if it sticks to its commitments. https://t.co/G0LSv41VRO
— Livemint (@livemint) December 21, 2018
Shares of Indian Hume Pipe jumped as much as 8.08% in early trade to ₹368.35 per share after the company on Thursday disclosed that it has secured an order worth ₹502.89 crore from Andhra Pradesh Drinking Water Supply Corporation. Shares traded 3.8% up at ₹353.95 per share.
Citi said the government’s capital infusion in India’s public sector (PSU) banks will ensure banks remain solvent, but may not help growth. Capital might help some banks to come out of prompt corrective action, but not sure if there will be enough capital left for growth after providing for non performing assets (NPA) as NPA levels remain high, added Citi.Citi said, of planned market capital raise of ₹58,000crore, banks have been able to raise only ₹18,000 crore. The govt is trying to bridge the shortfall in market capital raising by infusing additional ₹41,000 crore.State Bank of India and Bank Of Baroda are adequately capitalized for growth, noted Citi. As of last close, NSE PSU bank index had declined about 17.6% this year. Reuters
The BSE Sensex traded 165.98 points, or 0.46%, down at 36,265.69, and the Nifty 50 fell 50 points, or 0.46%, to 10,901.70. The BSE midcap and smallcap indices fell 0.48% and 0.13%, respectively. Sixteen out of the 19 sectoral indices traded lower with realty, IT, oil and gas and energy falling around 1%. Telecom, metal and power traded higher.
Infosys shares fell as much as 2.1% to ₹652.50 per share. The company appointed Bharti Airtel’s global CFO Nilanjan Roy as chief financial officer, effective 1 March 2019. He replaces interim CFO Jayesh Sanghrajka, who will resume his responsibilities as deputy CFO. Sanghrajka had taken temporary charge after M.D. Ranganath abruptly resigned as Infosys CFO in August this year.
Shares of public sector banks advanced today after the government on Thursday sought Parliament’s approval for supplementary grants worth ₹41,000 crore to infuse fresh capital into ailing state-run banks in the current fiscal. The additional capital could help as many as five such state-run banks exit the prompt corrective action (PCA) framework that mandates them to pare lending to companies and cut concentration of loans to certain sectors.The Nifty PSU Bank Index rose 0.5% led by gains in Central Bank of India, Punjab National Bank and Syndicate Bank.
Shares of Bharti Airtel Ltd rose as much as 2.5% to ₹324.20 per share after the company said its board approved a sale of up to 59.12 crore equity shares, representing 32% stake of Bharti Infratel owned by the company, to its arm Nettle Infrastructure Investments.
The rupee weakened marginally against the US dollar, tracking selloff in global equity markets amid rising concerns over global economic growth. At 9.12am, the rupee was trading at 70.05 a dollar, down 0.49% from its Thursday’s close of 69.70. The rupee opened at 69.94 and touched a high and a low of 69.70 and 70.06, respectively. The 10-year gilt yield was trading at 7.27% from its previous close of 7.275%. So far this year, the rupee has declined 8.76%, while foreign investors have sold $4.37 billion and $7.12 billion in the equity and debt markets, respectively.
Reacting to the US Federal Reserve’s hawkish stance, equities in the US and European markets corrected on Wednesday, followed by the Asian markets, which began Thursday’s trading session in the red. But as the day progressed, Sensex and Nifty recovered more than its emerging market peers. While China’s Shanghai Composite Index, Hong Kong’s Hang Seng index, South Korea’s Kospi shed 1% or more, India’s Nifty50 closed the day at 10,951.70, down 0.14%.But, why was India an outlier?
Of late, Sensex and Nifty have been quite resilient to a slew of sudden negative outcomes. https://t.co/hA6KQCjsmC
— Livemint (@livemint) December 21, 2018
Oil prices climbed on Friday after tumbling 5 percent in the last session, with OPEC production cuts that start next month seen being deeper than previously expected. Benchmark Brent crude futures were up 1.51% at $55.17 per barrel, recovering from losses of $2.89 per barrel the session before. US WTI crude futures rose 1.53%, or 70 cents, to $46.58 per barrel.Gold prices held firm on Friday, having climbed to a near six-month high in the previous session, as investors shunned risky assets and the dollar lingered near one-month lows. Spot gold was steady at $1,260.16 per ounce, after jumping over 1% in the previous session. The precious metal hit a high of $1,266.4 on Thursday, a level last touched on June 26. US gold futures declined 0.3% to $1,263.7 per ounce.Metals: Copper prices edged higher in London and Shanghai in early trade on Friday, after a report from an industry study group showed a widening supply deficit. Three-month LME copper rose by 0.3% a tonne to $6,020 a tonne. The most-traded February copper contract in Shanghai nudged up 0.2% to $7,009.72 a tonne. Most other base metals made modest gains in quiet pre-holiday trade, with nickel adding 0.5 percent in London and Shanghai. Reuters
Global stocks were sailing into Christmas on a sea of red on Friday, as the threat of a U.S. government shutdown and of further hikes in U.S. borrowing costs inflamed investor unease over the economic outlook.The S&P 500 was heading for its worst quarter since the dark days of late 2008, with a loss of 15% so far. The Nasdaq has shed 19.5% from its August peak, just shy of confirming a bear market. E-Mini futures for the S&P 500 were off another 0.25% on Friday, while MSCI’s broadest index of Asia-Pacific shares outside Japan shed 0.6%.Japan’s Nikkei fell 1.8%, and was down more than 6% for the week so far, while Australian stocks slipped 1% to a two-year trough. Chinese blue chips lost 1.2%, in part after the United States accused Beijing of orchestrating the hacking of government agencies and companies around the world. Reuters
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