Sensex ends 661 points lower, Nifty holds 10,600; Banks, financial stocks bleed14 min read . Updated: 14 Jul 2020, 03:44 PM IST Devansh Sharma
- Indian benchmark equity indices closed nearly 2% lower on Tuesday, dragged by losses in banks and financial stocks amid selloff in global markets
- Sensex settled at 36,033.06, down 660.63 points or 1.80%, while Nifty closed 195.35 points or 1.81% lower at 10,609.35
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Indian benchmark equity indices closed nearly 2% lower on Tuesday, dragged by losses in banks and financial stocks amid selloff in global markets.
Sensex settled at 36,033.06, down 660.63 points or 1.80%, while Nifty closed 195.35 points or 1.81% lower at 10,609.35.
IndusInd Bank, closing 5.5% lower was the top laggard on Sensex followed by Axis Bank, Maruti, Bajaj Finserv, Power Grid and SBI. Bharti Airtel Titan and Bajaj Auto were rare gainers.
Of 30 Sensex shares, 27 closed in the red.
Fuel-tax hikes are putting brakes on India’s recovery
The central government has hiked import and excise taxes twice this year even as it imposed the world’s biggest coronavirus lockdown. Retail prices for diesel -- the lifeblood of India’s economy -- in the capital New Delhi have jumped 30% since the end of April, while gasoline has risen 16%. (Full report)
Mindtree Q1 revenue down 9% q-o-q, sees recovery in Q2
Mindtree Ltd’s dollar revenue for the June quarter declined 9% sequentially to $253.2 million mainly due to the impact of the covid-19 pandemic on its travel, tourism & hospitality (TTH) vertical that contributes about 16% to the overall revenue.
The Bengaluru-based IT services company however expects recovery in the coming quarter on the back of a healthy deal pipeline and strong digital demand.
“We expect Q2 to be better than Q1," said Debashis Chatterjee, chief executive officer and managing director, Mindtree.
In rupee terms, the company’s revenue for the fourth quarter stood at ₹1908.8 crore, down 6.9% sequentially and a growth of 4.1% on a year-on-year basis.
Supreme Court to hear AGR case on 20 July
The Supreme Court will continue hearing the adjusted gross revenue (AGR) case on 20 July. The apex court on 18 June had adjourned the case till the third week of July, asking Vodafone Idea Ltd, Bharti Airtel Ltd and Tata Teleservice to furnish financial statements and books of accounts of last 10 years to ascertain the firms' capability to clear AGR related dues.
The court had sought details on revenue earned and taxes paid by these telcos in the past 10 years and had asked these companies to give details of security and guarantees to ensure they will abide by the payment plan.
Google in talks to invest $4 billion in Reliance's digital arm: Report
Alphabet Inc's Google is in advanced talks to invest $4 billion for a stake in the digital arm of Indian conglomerate Reliance Industries Ltd, Bloomberg reported on Tuesday, citing people familiar with the matter.
Google declined to comment, while Reliance did not immediately respond to a request for comment. (Full report)
Angel Broking on market sell-off
"Markets witness sharp sell-off today with financials bearing the greatest brunt, on the back of weak global cues, and concerns with regard to rising COVID-19 cases in the USA. Technically too, markets are trading closer to key resistance levels, so profit-booking is being witnessed. Going forward, we could see a rise in INDIA VIX, indicating short-term concerns and fears of the investor community. Stay alert and be prepared for volatility in coming days."
Dr. Reddy’s Laboratories up 1%
Dr. Reddy’s Laboratories has launched over-the-counter Nicotine Polacrilex Lozenges, 2 mg and 4 mg, the store brand version of Nicorette® Lozenges in the US market. The Nicotine Lozenges brands and store brand markets had total US retail sales of approximately $200 million for the most recent 52 weeks ending in May 17, 2020 according to IRI.
Rupee skids 23 paise to close at 75.42 against US dollar.
Bharti Airtel up 1%
Bharti Airtel Ltd is likely to announce a partnership with US telecom giant Verizon Wireless-owned BlueJeans to launch its video calling service, Airtel BlueJeans, according to a Mint report. With this service, Airtel will compete with the likes of Reliance’s JioMeet, launched earlier this month, Zoom and Microsoft Teams.
The details of the tie-up are yet to be known and an official announcement is likely later on Tuesday, the persons said. According to Bharti Airtel, its chief executive officer (CEO) Gopal Vittal will brief the media post market hours today.
India's auto sales volume will take 3-4 years to recover
India's auto sales volume will take another 3-4 years to reach 2018 levels, an industry body executive said on Tuesday, as the coronavirus-induced lockdown hurt monthly revenue and increased pressure on a sector already reeling from poor demand.
The pandemic-related disruption to the supply chain comes at a time when India's auto industry was already facing a slowdown in demand and government rules to adopt tougher emission standards forced carmakers to hike prices, driving customers away.
India's passenger vehicle sales rose 3% to 3.37 million units in fiscal 2018-19, but fell by 18% a year later due to weak demand and the onset of the pandemic.
The Society of Indian Automobile Manufacturers (SIAM), an industry body, said domestic car and SUV sales slumped 50% in June from last year, while sales of two wheelers - widely seen as an indicator of the health of the rural economy - fell 39%.
The rapid spread of the coronavirus and subsequent nationwide lockdown forced several automakers to suspend manufacturing and report zero sales in April, worsening the situation for the sector. (Reuters report)
Pharma stocks trade higher in an otherwise weak market
Of 30 Sensex shares, 28 are trading in the red
Vodafone Idea drops 3.4%
The Telecom Disputes Settlement and Appellate Tribunal (TDSAT) on Tuesday refused to stay the sector regulator’s order asking to put on hold Vodafone Idea’s RedX plan offering faster data speeds and priority services to higher-paying postpaid customers. Vodafone Idea had approached the appellate tribunal on Monday. The hearing will continue on 16 July, the TDSAT said.
Future Retail, Biocon top gainers on BSE MidCap index
BF Utilities surges 10%
Shares of BF Utilities jumped 10% on Tuesday following reports of ace investor Radhakishan Shivkishan Damani having acquired 1.3% stake in the company.
According to the latest shareholding pattern, Damani held 1.30% stake in Kalyani group company as of 30 June.
At 12:20 pm, BF Utilities traded at ₹220.95, up 9.9% from its previous close.
WPI based inflation contracts for third consecutive month in June
India’s wholesale price inflation contracted for the third consecutive month in June as crude oil price fell drastically while manufacturers lost pricing power as consumer demand waned due to the unfolding coronavirus pandemic.
Data released by the industry department showed in June wholesale price index (WPI) inflation contracted 1.81% in June against 3.21% contraction in May. During the month, crude petroleum prices softened 41.4% compared to its price during the same month in the previous year ago while fuel prices also eased by 13.6% from their levels a year ago.
10 out of the 17 categories of manufactured products listed in WPI including textiles, leather, wood, chemical, basic metals saw contraction in prices as both demand and supply remained constrained due to coronavirus related issues.
Indian stocks to lag rivals as stimulus falls short
Foreign investors have begun to price in a slower rebound for Indian stocks this year on concerns that the relatively meagre stimulus the government has delivered for businesses and consumers will leave the economy trailing its main rivals.
Indian equity indices have bounced about 43% since crashing to a four-year low in March, as the huge flows of cheap capital provided by global central banks when covid-19 struck made heavily-discounted stocks attractive.
Despite pouring about $1.98 billion into Indian stocks since late March, foreign investors are still net sellers this year with outflows of $2.75 billion. In March alone, they pulled out $8.35 billion, according to stock exchange data.
While India presented a monetary and fiscal stimulus package of $266 billion, or 10% of GDP, economists say new spending commitments will only come to about 1% of national output, or roughly $20 a head, on top of its original 2020 budget.
Analysts say India is constrained by its public debt-to-GDP ratio, which stood at 71% early in 2020, second only to Brazil in the BRICS group of major emerging markets and ahead of South Africa, China and Russia.(Reuters analysis)
Dish TV lenders invoke pledged shares, sell 3.85 crore shares
DTH service provider Dish TV on Tuesday said lenders have sold 3.85 crore pledged promoters' shares, following which the shareholding of the promoter group firm Direct Media Distribution Ventures Pvt Ltd has come down by 2.09%.
In a regulatory filing Dish TV India said "3,85,65,000 shares have been sold by the lenders to whom shares of Dish have been pledged".
These shares were sold in four tranches between June 23-July 9, 2020.
Auto industry may suffer a huge setback amid slow recovery
Automobile companies' resumption of manufacturing and sales after the government eased covid-19 induced lockdown restrictions, came as a relief to investors. The Nifty Auto index is back to its February levels.
While automobile sales are seeing sequential (month-on-month) improvement, many fear the recovery to be weak, impacting near term financial performance of the companies. (Full report)
Nifty Bank down 2.7%; Axis Bank, IDFC First Bank top laggards
RIL, HDFC twins, ICICI Bank top drags on Sensex
What investors should expect from June quarter results of FMCG companies
The Nifty FMCG index has been fairly resilient. So far in the calendar year, the index has risen 3%. In complete contrast, the Nifty 50 index is down 11% during the same period.
That’s hardly surprising as the outlook for companies engaged in sale of essential items is comparatively better than other product categories during covid-19 times. Even so, it is extremely challenging to estimate the earnings impact for April-June, as the country was under a strict nationwide lockdown for a good part of the quarter. (Full report)
Thomas Cook India slips 5%
Thomas Cook (India) along with group company SOTC Travel Ltd on Tuesday announced the launch Private Journeys. The premium offering will provide chauffeured van tours, strategically designed for smaller groups of family or friends. Private Journeys covers more than 32 countries, for travel from September at a starting price of ₹25, 800.
Avantel Ltd up 1.4%
The company has received order for an amount of ₹5.29 crore from DRDO, Ministry of Defence for supply of Tele-Command RF System.
HDFC Bank falls 3%
Shares of HDFC Bank fell as much as 2.74% on Tuesday after it launched a probe into its auto lending practices following allegations against the conduct of a long-time executive who retired on March 31 this year.
Equity benchmark Sensex dropped over 600 points in early trade on Tuesday, dragged by losses in banks and financial stocks amid selloff in global markets.
At 11:10 am, Sensex was at 36,077.58, down 616.11 points or 1.68%, while Nifty declined 179.85 points or 1.66% to 10,622.85.
Shares of the HDFC duo led the fall in the indices, shedding up to 3%, after HDFC Bank said it has launched a probe into its auto lending practices following allegations against the conduct of a long-time executive who retired on March 31 this year.
IndusInd Bank, Axis Bank, SBI, Bajaj Finserv, Bajaj Finance, and Tata Steel were among the other laggards.
Of 30 Sensex shares, 28 were in the red.
Rupee slips 16 paise to 75.35 against US dollar in early trade
The rupee depreciated 16 paise to 75.35 against the US dollar in opening trade on Tuesday tracking weak domestic equities and strengthening American currency.
The rupee opened at 75.33 at the interbank forex market, then lost ground and touched 75.35 against US dollar, down 16 paise over its last close.
It had settled at 75.19 against the US dollar on Monday.
Facebook helps Reliance Industries shares part ways with oil
For decades, Mukesh Ambani’s empire has been supported by the energy flank he inherited from his father.
But when Ambani faces shareholders at Reliance Industries Ltd.’s annual meeting on Wednesday, he’ll be speaking on behalf of an empire that is increasingly breaking free from oil-price fortunes. The billionaire’s string of deals with Facebook Inc. and other Silicon
Valley players this year have propelled Reliance into the e-commerce and technology space like never before. (Full report)
Bharti Airtel declines 0.7%
The company will move the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) against the Telecom Regulatory Authority of India (Trai) order directing to put on hold the telco’s Platinum plan, which offers faster data speeds and priority services to higher-paying postpaid customers, according to a Mint report.
Zydus Wellness slips 0.6%
The company believes that the impact of covid-19 on its business, supply chain and demand of products will not be significant. “We remain cautiously optimist about next 2 quarters of the Financial Year 2020-2021. Meanwhile, we are also finding newer ways of managing the business and have been working of changes in the business operating model, including the possibilities of using digital technology," Zydus Wellness said in a regulatory filing.
Wipro Q1 earnings: Five things to watch out for
Given the uncertainty, analysts believe IT companies will refrain from providing an annual guidance. Wipro typically gives quarterly revenue guidance but did not do so in the last quarter citing lack of clarity because of the pandemic.
Higher-than-expected inflation leaves economists divided on RBI’s next move
India’s retail inflation in June was at 6.1%, breaching the upper band of the Reserve Bank of India’s (RBI) inflation target of 4%. The reading was higher than Bloomberg’s consensus estimates of 5.3%.
With that, economists are divided on what the RBI’s next move would be in its August monetary policy meeting. Some expect the central bank to maintain a status quo on rates this time around. (Full report)
Godrej Industries up 0.6%
The company has approved the issuance of up to 7,500 rated, listed, unsecured, redeemable, non-convertible debentures having face value of ₹10 lakh each, aggregating to ₹750 crore on private placement basis.
Motherson Sumi declines 1.6%
Moody's Investors Service on Monday downgraded the rating outlook of auto component maker Motherson Sumi Systems to negative on account of expected weak financial performance in ongoing fiscal due to the coronavirus pandemic. Moody's changed the outlook on the rating to 'negative' from 'ratings under review', the rating agency said in a statement.
Cipla up 0.6%
The discussions to renegotiate the deal between Cipla’s US subsidiary, CipTech and Pulmatrix, Inc for the co-development and commercialization of antifungal drug Pulmazole, are now in progress. The renegotiated agreement may include, amongst other things a reallocation of costs and a grant of rights to CipTec to develop and commercialize Pulmazole in select markets outside the United States, Cipla said in a regulatory filing.
Most sectoral indices on NSE in the red
RIL drops 0.4%
Jio Platforms, a wholly owned subsidiary of Reliance Industries Ltd, has received ₹420.5 billion from five investors -- Vista Equity Partners, Omicron Asia Holdings II Pte, MIC Redwood 1 RSC Limited, Platinum Owl C 2018 RSC Ltd and India Markets Pte – and has allotted equity shares to them.
Biocon up 1.6%
Biotechnology major Biocon on Monday said it will launch biologic drug Itolizumab for the treatment of moderate to severe covid-19 patients at a price of around ₹8,000 per vial. The company has received approval from the Drugs Controller General of India (DCGI) to market Itolizumab injection 25mg/5mL solution for emergency use in India for the treatment of cytokine release syndrome in moderate to severe acute respiratory distress syndrome due to covid-19.
Indian benchmark equity indices opened lower on Tuesday tracking weakness in global peers. Sensex opened at 36,517.28, down 176.41 points or 0.48%, while Nifty declined 51.85 points or 0.48% to 10,750.85.
HCL Tech, up about 1%, was the top Sensex gainer followed by Infosys, Asian Paints and TCS. HDFC, Bajaj Finance, HDFC Bank, IndusInd Bank and Tata Steel were among the laggards. Of 30 Sensex shares, 23 were in the red at open.
Asian stocks declined in the early deals tracking their US peers amid fresh Sino-American tensions and concern over the economic impact of rising coronavirus cases.
Indian stocks traded lower in the pre-opening session on Tuesday. At 9:05 am, Sensex dropped 71.15 points or 0.2% to 36,622.54, while Nifty declined 30.45 points or 0.3% to 10,772.25.
Stocks to Watch
RIL, Bharti Airtel, Biocon, Godrej Industries, Cipla and Zydus Wellness are among top stocks that may be in news on Tuesday.
Market at close on Monday
Indian benchmark equity indices closed marginally higher in a choppy trade on Monday, led by gains in IT and FMCG stocks.
After hitting an intraday high of 37,024.20, Sensex settled at 36,693.69, up 0.27% or 99.36 points. Nifty ended 36.65 points or 0.32% higher at 10,802.70.
Asian stocks slipped Tuesday, following their US peers lower amid fresh Sino-American tensions and concern over the economic impact of rising coronavirus cases.
Topix index fell 0.5%.
Australia’s S&P/ASX 200 Index declined 0.3%.
Kospi index fell 0.6%.
Hong Kong’s Hang Seng Index fell 0.5%.
Shanghai Composite Index fell 0.7%.
Singapore's SGX Nifty retreated 0.5%, suggesting a weak opening for Indian benchmark indices.
Wall Street ends lower
The S&P 500 and Nasdaq ended lower on Monday, pulled down by Amazon, Microsoft and other recent big-name leaders of Wall Street's recent rally.
The Dow Jones Industrial Average rose 0.04% to end at 26,085.8 points, while the S&P 500 lost 0.94% to 3,155.22.
The Nasdaq Composite dropped 2.13%, to 10,390.84.
The S&P 500 technology index fell 2.12%, leading declines.