PremiumSensex and Nifty ended over 1.4% higher on Monday following buying in IT, oil and gas and banking shares. In Asia, markets in Seoul, Shanghai and Hong Kong ended significantly higher, while stocks in Europe were trading in the green during mid-session deals.
The country's benchmark indices ended in green for the second consecutive day with Sensex gaining an impressive 760 points and Nifty settling for a 235-point gain. The Sensex closed at 54,521 points and the Nifty breached the 16,250 mark and closed at 16,284 points.
Among gainers, Hindalco, Infosys and IndusInd Bank added more than 4% each. Bajaj Finserv and Tech Mahindra were also among prominent gainers. Britannia, Dr. Reddy Laboratories and HDFC were the main laggards today.
All the sectoral indices ended up on the positive side with IT, Metal, PSU Bank, and Bank indices gaining more than 2% each.
Globally, investors are awaiting a decision by the European Central Bank on Thursday on whether to raise interest rates for the first time in 11 years to curb inflation.
The Indian rupee pared early gains to close at record low on Monday, as rising crude prices weighed on the currency.
Gold rebounded from last week’s 11-month low, supported by a weakening dollar as traders pare back expectations of aggressive Federal Reserve interest-rate hikes.
Prices bounced as much as 0.9% on Monday as the dollar declined for a second day, taking some of the strain off the non-interest bearing precious metal after the prospect of a super-sized rate hike helped spark a fifth straight week of losses.
L&T Realty on Monday said it has signed agreements to jointly develop projects worth ₹8,000 crore in the Mumbai region as part of its expansion plan. L&T Realty is the real estate development arm of Larsen & Toubro.
"The company has entered into a binding agreement to jointly develop projects in South Mumbai, Western Suburbs and Thane worth ₹8,000 crore, with development potential of 4.4 million square feet," L&T Realty said in a statement.
The company did not disclose the name of companies with whom it has signed agreements.
Morgan Stanley cut its forecast for India's annual growth to 7.2% for this year, as tighter financial conditions and a slowdown in global trade have pressured major economies around the world.
The brokerage's forecast, down from its previous projection of 7.6%, comes after India's economic growth slowed to the lowest in a year in the first three months of 2022 at 4.1%. The revised target is in line with the Reserve Bank of India's view. For the next year, Morgan Stanley expects the annual GDP to touch 6.4%.
Tata Consultancy Services (TCS) said on Monday it has been ranked number one by revenue among the top 30 suppliers of software and IT services (SITS) to the UK market by industry analyst firm, 'TechMarketView'. The report is compiled through a detailed analysis of UK revenues of over 200 publicly quoted and privately held companies, a TCS statement said. TCS has retained its position as the UK's largest SITS provider.
Retailers reported a 13% growth in sales in June this year compared to the same month in 2019, according to a survey by the Retailers Association of India (RAI). Categories such as sports goods, jewellery and consumer electronics reported stronger growth in June compared to 2019 levels, as per the 29th edition of the Retail Business Survey. Retailers of sports goods reported a 29% growth in business, while jewellers reported a strong 27% sales growth in the same period. (Full Report)
Edible oil firm Adani Wilmar, which sells its products under Fortune brand, on Monday announced a reduction in cooking oil prices by up to ₹30 per litre amid a fall in global prices. The maximum reduction has been done in soyabean oil. The stocks with new prices will reach the market soon. On February 7, Mother Dairy, which sells edible oils under the Dhara brand, cut prices of soyabean and rice bran oils by up to ₹14 per litre.
Small-cap realty stock Emami Realty today hit its 52-week high of ₹70.20 apiece levels. Emami Realty share price today opened at par with its Friday close on NSE and soon attracted bulls' attraction and hit an intraday high of ₹70.20 per share levels and created a new 52-week high. (Read More)
At 12.50 pm, the September contract of Brent on the Intercontinental Exchange was at $103.59 a barrel, higher by 2.40% from its previous close. The August contract of West Texas Intermediate (WTI) on the NYMEX rose 2.20% to $99.74 per barrel.
Rising covid cases in China, prospects of fresh lockdowns and anticipation of a global recession had weighed on crude oil prices last week and analysts say that the concerns still persist
India's Yes Bank is seeking to raise about $1 billion this financial year, its chief executive officer said on Monday, as the private lender exits a reconstruction scheme after two years. Yes Bank CEO Prashant Kumar's comments come days after the lender said it had selected an asset reconstruction company belonging to private equity firm JC Flowers as the base bidder for the sale of bad loans worth 480 billion rupees.
European stock markets rose at the open Monday, with all eyes on the ECB later in the week when it finally raises eurozone interest rates to fight runaway inflation. Frankfurt's DAX index climbed 0.5 percent to 12,931.24 points and the Paris CAC 40 gained 0.5 percent, rising to 6,066.96. London's FTSE 100 index advanced 0.8 percent to 7,214.50 points.
The European Central Bank is expected to raise the interest rates on Thursday for the first time in more than a decade.
The global crypto market was on a bull run on Monday as demand for cryptocurrencies picked up. On the back of strong volumes, the crypto market recouped its over $1 trillion valuation. A broad-based buying has been recorded in this market with Bitcoin leading the pack. The leader of cryptocurrencies has crossed over the $ 22,200 mark. Meanwhile, its counterpart Ethereum contributed substantial gains to the market.
The share of remittances from the Gulf Cooperation Council (GCC) region to India has declined in 2021, the Reserve Bank of India said, reflecting a slower pace of migration and the presence of the Indian diaspora in informal sectors that were hit the most during the pandemic period. Remittances are the second major source of external financing for low and middle-income countries after foreign direct investment.
The Delhi High Court on Monday rejected a public interest litigation (PIL) seeking to stop the operation of SpiceJet airline for allegedly flying its aircraft in breach of professional and safety obligations.
The court cannot stay the operation of an airline on the basis of a PIL and press reports, a bench headed by Chief Justice Satish Chandra Sharma said while dealing with the petition by lawyer Rahul Bhardwaj.
The Indian economy is showing resilience and dynamism in spite of the geopolitical situation and high-risk aversion in financial markets that is stampeding portfolio investors and taking down all currencies against the unrelenting strength of the US dollar, it said. Further, the recent revival of the southwest monsoon and rejuvenation of sowing activity has raised hopes of another bountiful year for agricultural activity, raising expectations that rural demand will soon catch up with urban spending and consolidate the recovery, it added.
The company's standalone revenue jumped 90.4% year-on-year (y-o-y) to ₹3,112.8 crore in Q1, helped by the low base of last year when operations were hit because the second wave of the coronavirus pandemic. Even so, robust execution was a key factor driving growth in the June quarter.
Leasing of industrial and warehousing spaces across five cities rose 7 per cent to 10.8 million square feet in January-June period on better demand, according to Colliers India. The gross leasing or absorption stood at 10.1 million square feet in the first six months last year in five major cities namely Delhi-NCR, Mumbai, Chennai, Bengaluru and Pune. Absorption of industrial and warehousing space remained flat at 3 million square feet in Delhi-NCR.
In Brussels, EU foreign ministers will meet to discuss fresh sanctions against Moscow, which has already been hit with a series of punitive measures since the war started in February. The bloc is considering banning gold purchases from Russia, and more Russian figures could also be placed on the EU blacklist.
However, for L&T Technology Service, it recommended a ‘Neutral’ outlook. The report said, “We change our Rating from ADD to NEUTRAL on the stock, inline with revised Recommendation parameters and value it at 27.5x on FY24E earnings, arriving at target price of ₹3,388 /share. We have cut down target multiple from 35x to 27.5x to account for higher cost of capital(WACC) in this environment of high macroeconomic uncertainty. The stock trades at PER of 25.1x on FY24E EPS."
It is shaping up to be a fraught week for Europe as it waits anxiously to see if Russia resumes the flow of gas through the Nord Stream 1 pipeline on July 21, while Italy teeters on the brink of political turmoil should Prime Minister Mario Draghi go ahead and resign.
"If gas flows do not resume meaningfully, European gas prices will surge, prompting Germany and others to enact gas and power rationing with a deep recession all but guaranteed if this were to occur," said Taylor Nugent, an economist at NAB.
The monsoon session of Parliament for the year 2022 is all set to commence from today on July18, as per the Lok Sabha secretariat press release which was shared last month on June 30. Both the houses of Parliament, the Lok Sabha and Rajya Sabha, are likely to meet from July 18 and the session will conclude on August 13, according to the Lok Sabha secretariat release. The monsoon session holds extreme importance as the election of the President and Vice-President office is slated to take place in this session
India logged 16,935 new coronavirus infections taking the total tally of COVID-19 cases to 4,37,67,534, while the daily positivity rate was recorded above six per cent after 161 days, according to the Union Health Ministry data updated on Monday. The active cases have increased to 1,44,264, while the death toll has climbed to 5,25,760 with 51 new fatalities, the data updated at 8 am stated.
Axis Securities in a report said “Federal Bank’s (FB) Q1FY23 performance was robust across parameters and was above our expectations. Advances picked up the pace and registered a growth of 16/5% YoY/QoQ. The management has indicated that this growth pick-up has been broad-based and is likely to sustain. The management expects the incremental growth would be driven by CV, Credit Cards and Microfinance. We revise our credit growth estimates upwards and expect advances to grow at 16% CAGR over FY22-25E." It added, "The stock currently trades at ~1.0x FY24E ABV and we believe valuations are attractive. We maintain a BUY recommendation with a revised Target Price of ₹125/share (1.2x FY24E ABV), implying an upside of 27% from the CMP.
India’s slow monsoon progress has delayed rice sowing but farmers will be ramping up planting in the coming months, which will likely ease concern about a potential ban on exports. The area planted by the top rice exporter has shrunk 17% this monsoon season through mid-July compared to a year ago. This is due to delayed rains in some eastern growing areas, said Trilochan Mohapatra, secretary of the Department of Agricultural Research and Education.
The industrial metals continue to move southwards, as prices of all the metals end on a lower note, as LME Nickel was the top losing metal off the lot.
Individual metals, including copper, fell to 20-month lows while aluminum fell to one-year lows as a result of fresh Covid-19 restrictions in China coupled with fears of high-interest rates given the rising inflation in the US.
Meanwhile, concerns about an economic slowdown have dampened demand for industrial metals. The U.S. Federal Reserve is expected to raise rates in its upcoming meeting this month. These higher rates have increased fears of recession, which are now anticipated globally and in the US.
As the dollar is hovering near 20-year highs, which makes the metals priced in the dollar costlier for buyers holding other currencies, it can also reduce the demand for the metals.
However, the downside looks limited given encouraging developments from the world's largest consumer of metals, China. As lockdowns were eased, the nation's exports rose at the fastest rate in five months. Additionally, imports of copper increased by 15.5 percent in June compared to the previous month.
Outlook: While the improvement in the Chinese economy would limit the fall in metals, the expectation of a Fed rate hike would keep the metal prices under pressure.
HDFC Bank on Saturday reported a 19% year-on-year (YoY) rise in its net profit for the April-June quarter at ₹9,196 crore after providing ₹2,984.1 crore for taxation. Net interest income (NII) for the June quarter grew by 14.5% to ₹19,481.4 crore from ₹17,009.0 crore for the same quarter last year.
Mr Mitul Shah, Head Of Research at Reliance Securities says, “Inflationary pressure is a major concern and fears of a recession is looming. India's CPI inflation stayed above 7% in June, while the U.S recorded a 41-year-high inflation at 9.1%. Major central banks around the world are likely to consider a steep hike in interest rates in order to tackle elevated price levels. Additionally, recent data suggested that consumer sentiment across the globe continues to be low. India's depreciating rupee, widening trade deficit, selling pressure from FIIs and volatility in global crude prices are augmenting the economic and financial impediments. We expect strong economic rebound, normalized commodity prices, inflation within targeted range and better visibility in 2HFY23, which would transform."
Several large Chinese cities including Shanghai are on their toes due to new outbreaks of Covid-19 infections, rolling out repeated mass testing or extending lockdowns on millions of residents, with some measures triggering a public outcry. China has reported an average of around 390 local daily infections in the seven days ending on Sunday, higher than about 340 seven days earlier, according to Reuters calculations based on official data as of Monday.
Consumers will now have to shell out more for rice, wheat and flour, among other items if branded and packed in a unit container from Monday as the revised Goods and Services Tax comes into effect. Pre-packaged and labelled pulses, and cereals like rice, wheat, and flour (atta) will now attract GST at the rate of 5 per cent when branded and packed in a unit container.
Other items that will be dearer are printing, writing or drawing ink, knives with cutting blades, paper knives, pencil sharpeners and blades, spoons, forks, ladles, skimmers, and cake-servers. These items would now attract 18 per cent instead of 12 per cent.
Shanghai Composite index gained 0.7% to 3,251.54. In Seoul, the Kospi jumped 1.4% to 2,363.36. Australia's S&P/ASX 500 added 0.5% to 6,637.50. New Zealand shares edged higher even after the government reported that inflation hit a 32-year high of 7.3% in the April-June quarter. It was 6.9% in the previous quarter.
National Democratic Alliance's (NDA) presidential candidate Droupadi Murmu and joint opposition nominee Yashwant Sinha are the two contesting candidates for election to the Office of the President.
Just 16% of 792 respondents in the latest Pulse survey say Europe will likely manage to dodge an economic downturn over the next six months, with 69% betting that the single currency will slide to $0.9 rather than claw back to $1.1. To make matters worse, the political storm in the euro area’s third-largest economy may spur a new era of market fragmentation. Some 21% of MLIV readers say the spread between 10-year Italian and German bonds would have to blow out to more than 500 basis points -- the highest since the 2012 debt crisis -- before the ECB steps in.
With fears around the Covid pandemic waning, Indian households are now reporting growing concerns around the conflict in Ukraine, the state of the economy and unprecedented high inflation, according to Kantar’s Global Issues Barometer survey. Read more
Reliance Securities Market Lens on July 18 said, “Minda Industries enjoys leadership in 4W and 2W switches segment with 55% and 65% market share, respectively. It is also the leader in domestic acoustic segment with 47% market share."
It added, “We expect strong rebound in automobile production post semiconductor shortage easing out in 2HFY23, to act as a key driver for the company in FY23E. Moreover, higher content per vehicle, value addition on the back of premiumization, capacity addition of high-margin segments would be the key triggers for MNDA’s revenue growth outperformance and healthy earnings growth going forward. We have a BUY rating on MNDA, with a Target Price of Rs1,150."
HDFC Bank Ltd will consider public listings of its brokerage and non-banking financial company (NBFC) units only after the completion of a merger with parent HDFC Ltd, said the bank’s managing director and chief executive, Sashidhar Jagdishan. This April, the country’s top private lender announced its merger with HDFC to create a financial behemoth. The deal is expected to take 18-24 months to complete.
India achieved a major milestone in its vaccination programme against COVID-19 as the cumulative doses administered surpassed the 200-crore mark on Sunday, 18 months after it began the drive to combat the deadly epidemic that has claimed over 5.25 lakh lives in the country so far.
On Monday's session, the Japanese Nikkei is up 0.54 per cent, Hong King's Hang Seng is down 2.19 per cent whereas Chinese Shanghai is up 0.22 per cent. SGX Nifty is trading flat.
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