Indian equities fell in line with Asian peers on Wednesday, with technology stocks leading the decline as U.S. Treasury yields hit two-year highs. Globally, stocks are on track to hit a new low for the year while bond yields surged on Wall Street Tuesday amid renewed jitters that the Federal Reserve will lift interest rates to tackle rising inflation.
Markets at close
There was heavy selling pressure in IT, FMCG and banking and financial stocks. Infosys slumped by over two per cent. Wipro, HCL Technologies and TCS were down by close to one-and-a-half per cent.
The 30 stock S&P BSE Sensex of the Bombay Stock Exchange ended at 60,098.82 points, which was 656.04 points or 1.08 per cent down from its previous day's close.
The broader Nifty 50 of the National Stock Exchange ended at 17,945.30 points, which is 0.93 per cent or 167.75 points down from its previous day's close. The Nifty touched a high of 18,129.20 points and low of 17,884.90 points.
Asian Paints slumped 2.71 per cent to ₹3281. Infosys slumped 2.85 per cent to ₹1,866.20. Meanwhile, Maruti surged 1.21% to ₹1,209. Only seven of the 30 scrips that are part of the Sensex ended in the green. ONGC, Tata Motors, Coal India, SBI, and UPL were the top gainers on the Nifty where 14 stocks advanced while 36 declined.
Most broad market indices in the red
Global Stocks Pare Selloff as Bond Yields Climb
Stocks pared a global selloff on Wednesday as earnings optimism offset concerns about rising bond yields.
Retailers rose in Europe after Richemont and Burberry Group Plc beat expectations, while the broader Stoxx 600 Index and U.S. futures trimmed losses to trade little changed. A surge in Treasury yields is stirring expectations that the U.S. 10-year will top 2%.
Speculation is growing that the Federal Reserve may deliver more than a quarter-percentage point March interest-rate hike to fight inflation, while the Bank of England may move again next month.
Biocon up over 5%
IndianOil picks up IEX’s 4.93% stake in country’s only gas exchange IGX
Indian Energy Exchange (IEX), country’s largest power exchange and Indian Oil Corporation (IndianOil), India’s largest oil refining and fuel marketing firm, have entered into a strategic partnership under which the fuel retailer has picked up 4.93% equity in Indian Gas Exchange Ltd.
Top gainers/losers on Nifty at this hour
Power Finance Corporation, REC reduce lending rates across all types of loans
State-owned non-banking financial companies (NBFCs), Power Finance Corporation and REC Ltd have further reduced their lending rates across all types of loans by 40 bps, according to an official statement.
Paytm shares hit an all-time low today
Shares of Paytm slipped to an all-time low of ₹990 on the BSE by falling over 4% in Wednesday's trading session. The stock of the digital payments and financial services firm is now down over 53% from its initial public offering (IPO) issue price of ₹2,150 after its dismal listing and a spate of bearish views.
How Sensex is moving today
ADD ITC: ICICI Securities
- Macro & micro turning favourable
We expect ITC (stock) to benefit from (1) expectation of Value (on current FCF profile basis) to outperform Growth/Expensive basket, (2) potential price hikes in cigarettes in the current inflationary environment (better consumer acceptance likely), (3) good underlying performance in the FMCG business along with higher profit (& EVA) focus, and (4) improving outlook for the hotels business (likely cyclical upturn). Besides, focus continues on augmenting (overall) distribution.
We see (1) potential market share gains in cigarettes, (2) FMCG scale up and profitability improvement to continue and (3) potential to accelerate cost savings through a supply chain recast.
Recent media reports (link) indicate that the government panel (formed to decide on the future taxation policy for tobacco) is suggesting ways to tax tobacco (not just cigarettes). While near-term volume/profitability trajectory may be sensitive to this outcome, we believe a rational policy can provide some certainty in the medium-term. Reiterate ADD; TP Rs250.
ABFRL partners Algonomy for personalized shopping experience
Aditya Birla Fashion and Retail Ltd. on Wednesday said it has entered into a strategic partnership with Bengaluru-based Algonomy, which offers artificial intelligence (AI) solutions to retailers, to deploy its hyper-personalisation solutions to ABFRL’s brands.
Federal Bank, Equirus Wealth jointly launch USD Fixed Maturity Fund
Federal Bank and Equirus Wealth have together launched a ‘US dollar offshore fund’ for their customers. This is in collaboration with SCUBE Capital, a global fund management company based out of Singapore.
Budget 2022
The Indian government has worked on preparing a bill to regulate cryptocurrencies, which was expected to be presented to the Parliament in the Winter Session in November. Since it was not mentioned during the period, experts believe the government might mention it in the February budget.
Here is what India's crypto industry expects amid uncertainty around regulation.
Most sectoral indices in the red
2 of 30 Sensex stocks in the green
Paytm stock price hits new low
M&M partners with Hero Electric, to manufacture electric bikes Optima & NYX
Mahindra & Mahindra (M&M) and Hero Electric on Wednesday announced a strategic partnership in electric mobility to cater to the growing demand for electric vehicles (EVs) in India.
As part of the partnership, Mahindra Group will manufacture Hero Electric’s electric bikes – Optima & NYX at their Pitampur plant to meet the growing demands of the market. Hero Electric's manufacturing unit is in Ludhiana, and it sells a wide range of electric scooters.
Tata Motors launches Tigor CNG, Tiago CNG cars. Know prices, features
Tata Motors has today launched two new CNG cars to offer an alternative for the rising fuel prices in the country. The homegrown auto major launched Tata Tigor CNG and Tiago CNG today for the Indian buyers. This way, Tata Motors completes the tri-segment of vehicles; petrol/diesel, electric and CNG. Tata Tigor CNG and Tata Tiago majorly compete with Maruti Suzuki’s CNG-driven cars in India. Meanwhile, Tata Motors has also revised the passenger vehicles prices starting today due to rising input costs.
Infosys, ICICI Bank drag Sensex down
Ambit Asset Management launches ‘TenX Portfolio’ fund
Ambit Asset Management has announced the launch of ‘Ambit TenX Portfolio’, a long-term investment opportunity in the listed space to multiply wealth.
Lupin’s acquisition of branded portfolio to boost domestic sales
Lupin Ltd's proposed acquisition of a portfolio of brands of Anglo-French Drugs & Industries and its associates is being seen as a positive. The turnover of the portfolio being acquired was at ₹95 crore during FY21. As the acquisition is being done at cash consideration of ₹325 crore, it implies an enterprise value to sales valuations of 3.3 times, which is attractive and lower than the industry average of 4-5 times, as per analysts.
LTTS bags $45 million EV deal from US automotive firm
L&T Technology Services Ltd (LTTS) has bagged a deal worth $45 million from a US-based tier-1 automotive company, to be its strategic engineering partner and provide engineering services for its electric vehicle (EV) product portfolio.
ICICI Securities bullish on this multibagger IT stock post Q3 results, raises target price
Software company Newgen Software Technologies has reported robust growth of around 9% year-on-year (YoY) in Q3FY22 backed by strong performance in the EMEA/APAC region, highlighted brokerage house ICICI Securities as it sees more upside on the multibagger stock after the earnings.
Rupee falls 12 paise to 74.70 against US dollar in early trade
IEX divests 4.93% equity stake in arm IGX to Indian Oil
India Energy Exchange (IEX) announced divesting 4.93% equity stake in its subsidiary Indian Gas Exchange (IGX) to oil marketing company Indian Oil Corporation (IOC). Indian Oil has joined the company as a strategic partner by acquiring stake from promoter IEX.
Reliance Jio topples BSNL as largest fixed line broadband provider
In about two years of commercial roll out of its fixed-line broadband services, Reliance Jio has toppled 20 -year-old state-run telecom company BSNL as top service provider in the segment.
According to a monthly telecom subscribers report released by the telecom regulator Trai on Tuesday, Jio now leads the fixed-line broadband segment with 4.34 million customers.
Nifty below 18,000 now
L&T Tech stock slips 7% as Q3 revenue disappoints
Midcap IT company L&T Technology Services Ltd (LTTS) has upset its investors with a mixed performance in the December quarter. In constant currency terms, its revenue grew 4.2% sequentially, below the 5% estimate many analysts were penciling in for the company. A combination of unfavourable factors such as seasonality, weak performance of its industrial products and medical devices verticals and a high base of Q2FY22, weighed on LTTS' revenue.
9 of 30 Sensex stocks in the green
Reliance Jio prepays ₹30,791 crore, clears all deferred spectrum liabilities acquired before March 2021
Reliance Jio Infocomm Limited, a subsidiary of Jio Platforms Limited, on Wednesday announced that it has paid ₹30,791 crore, which includes accrued interest, to the Department of Telecom towards prepayment of the entire deferred liabilities pertaining to spectrum acquired in auctions before March 2021.
Markets opening view: Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments
We are very close to the psychological support level of 18000; ideally, the Nifty should close above this for the positive sentiment to remain intact. A break of this could take us down to 17750-17800 which is the next level of support.
BUY Angel One: ICICI Securities
Strong earnings growth continues; benefiting from increasing retail footprint on capital markets
Angel One (Angel) successfully maintained its business momentum in Q3FY22 with 110%/23% YoY/QoQ PAT growth. We estimate PAT to clock 37% CAGR between FY21-FY24E and we value the stock at 22x FY23E EPS of ₹86.5 (earlier: ₹74). Maintain BUY with a revised target price of ₹1,900 (earlier: ₹1,630).
Nifty tests 18,000
Most active stocks on Nifty
AGS Transact Tech IPO opens today
The initial public offering (IPO) of AGS Transact Technologies will open for subscription today. The price band of the three day initial share-sale has been fixed at ₹166-175 a share, which will conclude on Friday, January 21. The payment solutions provider raised ₹204 crore from anchor investors ahead of its issue.
Nifty at open
Sensex over 250 points down at open
Sensex in pre-open
Nifty in pre-open
Oil rises to 7-year high as Turkey outage adds to tight supply outlook
Oil prices rose for a fourth day to a seven-year high as an outage on a pipeline from Iraq to Turkey increased concerns about an already tight supply outlook amid worrisome geopolitical troubles in Russia and the United Arab Emirates.
Brent crude futures rose $1.44, or 1.7%, to $88.95 a barrel at 0230 GMT, adding to a 1.2% jump in the previous session. The benchmark contract climbed to as much as $89.05, its highest since Oct. 13, 2014.
Stocks to Watch: RIL, Bajaj Fin, Airtel, Axis Bank, ICICI Prudential Life
Here is the list of the top 10 stocks that are likely to be in focus on Wednesday.
Bajaj Auto kick-starts Q3 today. What can investors expect from two-wheeler cos’ results?
Bajaj Auto Ltd will announce its December quarter (Q3FY22) results today. Last quarter, the company’s volumes shrank by nearly 10% year-on-year. This was primarily driven by a 12% fall in two-wheeler (2W) sales, which was partly offset by an 18% growth in total three-wheeler sales (3W).
Even so, strong exports and price hikes are expected to support marginal year-on-year revenue growth in Q3. Motilal Oswal Financial Services expects Bajaj Auto’s Q3 revenues to rise by 1% year on year. However, the drop in sales volume and higher commodity costs have kept expectations low on the Ebitda margin front. Ebitda is earnings before interest, tax, depreciation and amortization; a key measure of profitability. Motilal Oswal estimates Bajaj Auto’s Ebitda margin to contract by 510 basis points (bps) year-on-year to 14.3%. One basis point is one-hundredth of a percentage point.
Rupee slumps 33 paise to 2-week low on high crude prices, rate hike worries
Continuing its fall for the third straight session, the rupee on Tuesday slumped by 33 paise to close at a two-week low of 74.58 against the US dollar as a strong American currency and elevated crude oil prices continue to weigh on investor sentiments. Forex traders said muted domestic equities and dollar buying by banks on behalf of importers also dragged the local unit down. At the interbank foreign exchange market, the local currency opened at 74.36 against the American currency and witnessed an intra-day low of 74.60 during the session. The rupee finally settled at 74.58, down 33 paise over its previous close of 74.25 against the greenback.
Day trading guide for Wednesday
6 stocks to buy or sell today - 19th January.
SGX Nifty futures trading 23 points lower at 18,115.50 in early deals
Market Wrap (Tuesday): Sameet Chavan (Chief Analyst-Technical and Derivatives, Angel One Ltd)
Nervousness across globe triggers sharp profit booking
Our markets started the session slightly in the green but right from the beginning the benchmark index looked a bit tentative. In the initial hour, Nifty tested sub-18200 levels from where the banking space took the charge and lifted markets higher to trim all losses. But market was not done with its action yet. As we stepped into the penultimate hour, the global markets became extremly nervous which resulted in a sharp decline to test 18100 at the close.
Today for the major part of the session, Nifty remained under pressure but banking was on a roll; but eventually it succumbed to the last hour sell off. This weighed down heavily on the overall sentiments as some of the stocks tumbled like a bottomless pit. Index wise, we lost slightly over a percent but the velocity at which market came off, it was intimidating. Also in last 4 – 5 days, index had done nothing but stock specific movement was quite enough to keep the traders engrossed all the time. Today it was the individual stocks who went under a hammer and hence, was certainly not a pleasant day for traders. Despite today’s correction, we are not seeing any structural damage yet, rather it should be considered as a profit booking after recent relentless run. As far as levels are concerned, 18000 followed by 17900 to be treated as key supports and if today’s decline was merely a profit booking, market should attract some buying interest around mentioned supports. On the flipside since the volatility has increased a bit, the resistance remains slightly higher at 18250 – 18350.
Most Asian Stocks Drop as Treasury Yields Climb:
Most Asian stocks fell Wednesday following a Wall Street selloff in the wake of a surge in Treasury yields, as the prospect of Federal Reserve monetary tightening to fight high inflation weighs on markets.
MSCI Inc.’s Asia-Pacific share index dropped for a fifth session, led lower by Japan, while China and Hong Kong were steadier. U.S. futures wavered after the S&P 500 suffered a broad drop and the tech-heavy Nasdaq 100 sank 2.6%.
The slide in Treasuries is stirring expectations that the benchmark 10-year yield will top 2%.
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