Stock Market Highlights: Indian shares ended at a six-month high on Friday. Banks contributed the most gains followed by media stocks. IndusInd Bank remained the top-gainer of the day, ending 12 percent higher followed by Axis Bank. Market breadth turned adverse with 1,084 stocks on the NSE posting losses while 745 stocks ended with gains.
Here are the key highlights from this week's session:
- Sensex & Nifty post biggest weekly gains in a month & Nifty Bank in 3 months
- Midcap Index gains for 4th straight week, posts biggest weekly gains in a month
- Sensex gains 2.7%, Nifty 2.4% and Nifty Bank 10% this week
- Midcap Index up 2.3% & PSU Bank top gaining index this week with 8%
- IndusInd Bank, Tata motors, Axis Bank & SBI top Nifty gainers this week
- Shree Cement, NTPC, Power Grid top Nifty losers this week
Here are the key market highlights from today's trading session:
- Financials lift market with the sector contributing 89 points to Nifty
- Sensex & Nifty gain nearly 1% each to close at 6-month highs
- Nifty Bank gains 4% to close at 5-month high; biggest 1-day gain in 3 months
- Sensex gains 354 points to 39,467 and Nifty 88 points to 11,648
- Nifty Bank surges 923 points to 24,524 and Midcap index 99 points to 17,369
- 5 of the top 10 Nifty gainers are financials; IndusInd Bank top gainet with 10% rise
- Sun Pharma surges 6% on positive commentary in the AGM
- Goldman Sachs’ upgrade fails to lift IT majors; Infosys & TCS slip
- Dr Reddy’s slips despite US FDA closing warning letter for 3 sites
- NMDC moves 12% higher as company expects Q2 to be better than Q1
Closing Bell: Sensex, Nifty end higher for sixth straight session; up 2.5% for the week
Indian indices ended higher for the sixth consecutive session on Friday lifted by gains in financial stocks. Heavyweights ICICI Bank, Axis Bank, Kotak Bank, IndusInd Bank, SBI, and HDFC contributed the most to the benchmarks.
The Sensex ended 354 points higher at 39,467 while the Nifty rose 88 points to end at 11,647. For the week, the indices rose around 2.5 percent.
The benchmark indices have climbed close to 5 percent this month on signs that business activity is picking up and global optimism around potential coronavirus vaccines.
Broader markets, however, were mixed fo the day with the midcap index up 0.6 percent and smallcap index down 0.3 percent.
IndusInd Bank, Axis Bank, UPL, SBI and ICICI Bank were the Nifty50 top gainers while JSW Steel, Hero MotoCorp, Dr Reddy's, Power Grid and Infosys were the index top losers.
Just In: Several states reject Central Govt's GST proposal asking them to borrow directly via RBI to bridge the compensation shortfall. Tune into CNBC-TV18 for an exclusive coverage of Shereen Bhan speaking to West Bengal's Finance Minister Dr Amit Mitra and Kerala's Dr Thomas.
Don't expect stamp duty cut to dramatically boost demand, says DLF
Real estate company DLF said that the reduction in the stamp duty by the Maharashtra government is a positive move, however, one should not expect it to dramatically boost demand.
The Maharashtra government on Wednesday announced its decision to reduce stamp duty on flats from 5 percent to 2 percent till December 31 and to 3 percent between January 1 and March 31.
Analysts believe the affordable and mid-segment properties, which are in maximum demand, will see the most traction from such a move. Jefferies says more states will follow suit and developers responding with price cuts are possibilities.
Reacting to the move, Ashok Tyagi, whole-time director at DLF, said, “We don’t know how the other states will follow, whether they will follow suit or not, that is something to be seen in the future. Even if nothing else changes, it does end up reducing the cost of real estate at the hands of the end customer by 3 percent. It reduces the cost of some restructuring transactions that the industry may need to take, so that is a welcome move for sure."
Max India lists at Rs 80 on BSE
Rupee Ends | The Rupee ended higher at 73.39 per dollar against Thursday's close of 73.84. The Rupee has risen 1.9 percent this week, posting biggest weekly rise against the dollar since the week ended December 21, 2018
The 5.79% 2030 bonds ended down 20 paise at Rs 97.20; yields at 6.18%
ICICI Direct launches commodity derivatives trading | Brokerage firm ICICI Securities has announced the launch of commodity derivatives trading on the icicidirect.com platform. The brokerage said this will enable its nearly 50 lakh client base to trade in commodities futures on the Multi Commodity Exchange (MCX). Existing icicidirect.com 3-in-1 account holders can begin trading post a simple online commodities registration process with a competitive brokerage of Rs 20 per order and only Rs 2 per lot, the brokerage said.
Battery majors Exide Industries and Amara Raja register first revenue decline in 20 years
The ongoing COVID-19 crisis, the decline in the auto OEM and telecom segments, and weakness in the overall economy have led to a first revenue decline for the battery industry in FY20 in the last 20 years.
The two major battery players, Exide Industries and Amara Raja Batteries have seen their revenue hurting by loss of sales due to the lockdown in the latter half of March 2020.
The revenue decline may continue in FY21, given 2-3 months of lockdown in the early part of the year. But, this decline has been mostly captured in Q1FY21, according to IIFL Securities. Read more here.
Technical Experts' View: Hemen Kapadia of KRChoksey Securities recommends three stocks. “We have a buy call on Sun Pharmaceutical.It has been moving sideways for almost 14 trading sessions, and might break out. We have a short term a buy call on the stock, at Rs 545 with stop loss Rs 530 and target at Rs 575.”
The second one is Shriram Transport Finance. Like Sun Pharma, the stock is consolidating and the volume has also picked up in the last three trading sessions. The indicators have turned positive given crossover buys. It is on the cusp of a breakout so one can buy Shriram Transport at Rs 760 with a stop loss Rs 745 and target Rs 790, said Kapadia.
His last recommendation is on HCL Technologies, with buy at Rs 715 stop loss at Rs 700 and target Rs 745.”
Milkbasket plans to launch IPO next year
Daily grocery delivery platform Milkbasket has advanced its plan to launch an initial public offering by the second half of next year, buoyed by strong growth in business in recent months amid the pandemic, a top company executive said.
Speaking to PTI, Milkbasket co-founder and CEO Anant Goel said the rapid adoption of at-home grocery delivery amongst consumers during the pandemic has provided an impetus to target an initial public offering (IPO) in just a year.
"Milkbasket has a near-perfect record of reaching growth targets since being founded in 2015. The rapid adoption of at-home grocery delivery amongst consumers due to the pandemic has provided us with an impetus to target IPO in just a year, which we had initially planned for the year 2023," he said. Click here to read more details
ITI says will achieve minimum 25% public shareholding norm by August 3, 2021. It’s exploring feasibility of various options including offer of shares to public within prescribed time limit for compliance.
A roller coaster ride: A 9000% spike in 5 months followed by a 50% fall in the next two
The share price of Ruchi Soya has lost more than half its value just in the last 2 months. The Patanjali-owned stock has lost as much as 56.2 percent from its 52-week high, hit on June 29, 2020, to currently trading at Rs 672. An investment of Rs 1 lakh on June 29 would have shrunk to Rs 43,778 today.
Baba Ramdev-led Patanjali Ayurved took full control of Ruchi Soya from NCLT in December 2019 after the firm went through the insolvency process. Ruchi Soya owed bankers close to Rs 9,300 crore and was dragged to the National Company Law Tribunal (NCLT), Standard Chartered Bank and HSBC. Among the bidders for the company were Adani Wilmar and Patanjali Ayurved.
It was relisted on January 27, 2020, at Rs 16.9. Since then, the stock surged nearly 9,000 percent in five months to its 52-week high of Rs 1,535. Read more
European equities seen higher after key Fed speech
European stocks are set to open higher on Friday morning as investors digest a major policy shift by the U.S. Federal Reserve, and continue to monitor coronavirus news, reported CNBC International.
The FTSE 100 is seen up by 34 points at 6033, while the Dax 30 is expected to open higher by 57 points at 13153, according to IG.
The reaction in Europe comes after U.S. equities got a boost on Thursday following comments from Fed Chairman Jerome Powell. He unveiled a major policy change, which suggests that interest rates are likely to remain low for some time. Generally, news of low rates is positive for stocks.
Stock Update: Dr Reddy's Laboratories' shares traded over a percent lower to Rs 4,384 per share on the NSE after the company said that it has addressed violations and deviations highlighted by US FDA in its warning letter for three of its facilities i.e. Srikakulam, Mriyalguda and Duvvada.
Technical Experts' View: Jay Thakkar of Marwadi Shares and Financials suggested two recommendations. One is Punjab National Bank, which could be bought for a target of Rs 41, with a stop loss of Rs 34.45. The second recommendation is ICICI Bank. One can buy this for a target of Rs 440 with a stop loss of Rs 380.
GMR Infra zooms 10% on board approval of restructuring of entities
GMR Infrastructure's (GIL) share price zoomed as much as 10 percent on Friday after the company's board approved to merge its non-airport business into a separate entity. The stock gained as much as 10 percent to hit its 52-week high of Rs 28.25 per share on the NSE. At 11:12 am, the shares erased all gains to trade 0.19 percent lower to Rs 25.65.
"This restructuring is a step in the right direction to unlock the value of GIL through a separate listing of both the airport business and non-airport business and simplifying the corporate holding structure," said the company's exchange filing.
Post demerger, the company will become a pure-play airport company. The filing also said that the businesses are showing signs of recovery after the lockdown impact.
GMR Infra is deleveraging through asset sales and moving towards focused verticals, said N Jayakumar, MD, Prime Securities.
He further mentioned, "GMR Infra could also look at fundraising to pare its debt before the demerger. Also, the company will get a premium as very few infrastructure players come out from the bankruptcy."
In the quarter ended June 30, the company reported net revenue at Rs 957 crore as against Rs 1,505 crore in the corresponding quarter last year.
Net loss in Q1FY21 stood at Rs 834 crore as compared to the loss of Rs 335 crore last year.
Meanwhile, in the last five trades, the stock has seen 10 lakh shares exchanging hands. The stock during this period has surged over 30 percent to current levels.
Edelweiss stake will be 40% in demerged wealth business.
Gold rate today: Yellow metal rises; support seen at Rs 50,500 per 10 grams
Gold prices in India rose on the Multi Commodity Exchange (MCX) Friday following gains in the international spot prices, but strength in rupee limited gains. Silver prices gained over 1 percent. At 11:15 am, gold futures for October delivery rose 0.29 percent to Rs 51,051 per 10 grams as against the previous close of Rs 50,902 and opening price of Rs 50890 on the MCX. Silver futures traded 1.09 percent higher at Rs 65,901 per kg. The prices opened at Rs 65,509 as compared to the previous close of Rs 65,190 per kg. In the international market, gold rose on Friday, having declined over 1 percent in the previous session, as persistent concerns over the pandemic-led economic slump boosted the metal's appeal, although gains were restricted by a jump in US Treasury yields, Reuters reported.
NMDC shares jump over 13% on demerger of Nagarnar iron and steel unit
The share price of state-run mineral producer NMDC rallied over 13 percent after the company approved demerger of Nagarnar iron and steel unit which analysts believe will be value accretive for the minority investors. The stock jumped 13.43 percent to an intraday high of Rs 108.90 apiece on the BSE. The company’s Board of Directors at their meeting held on Thursday accorded in-principle approval to the proposal to demerge NMDC Iron & Steel Plant (NISP), Nagarnar, Chhattisgarh. The move can unlock significant value for the minority investors as hardly any value gets attributed to Rs 16,000 crore of WIP in NMDC’s balance sheet on account of the steel plant, analysts said.
DoT circulates a draft Cabinet note on #4G spectrum auction, aims to hold the auction in December
Godrej Properties expects growth in sales this year despite COVID-19 outbreak
Realty firm Godrej Properties on Thursday said it will see growth in sales this year despite COVID-19 outbreak. Speaking to CNBC-TV18, Mohit Malhotra, managing director and chief executive officer said Maharashtra government's announcement to slash stamp duty to 2 percent from earlier 5 percent until December 2020 is an extremely positive move and it will have a positive impact on demand. Malhotra said people have accepted the digital medium to buy homes, "We are seeing a lot of demand coming out of digital channels. So, it is new for the industry and the consumers, and brands which can satisfy consumer needs will definitely get the benefit." More here
Japanese stock exchange Nikkei down more than 1% as PM is likely to resign due to health concerns
Market Watch: Manas Jaiswal of manasjaiswal.com
“First is a buy call on Federal Bank because I see a clear breakout after a lot of compression. Look at the pattern, I feel that Federal Bank can test Rs 65. So, for almost Rs 5 up move you can take long position over here. Stop loss should be around Rs 56.”
“Second is a buy call on UPL where the trend is quite positive. The stock has been making higher tops and higher bottoms from the levels of around Rs 350 and now the stock is trading above 200 day moving average. So, UPL has potential to test Rs 545, take a long position here and stop loss should be around Rs 494.”
Only 3 launches in 2020 till date; here are the ones in the pipeline
The initial public offer (IPO) market has been lackluster this year amid volatility due to the COVID-19 pandemic. In 2019, 16 companies launched their IPOs raising over Rs 12,000 crore, and 2020 was expected to be a rebound year. But the markets are still awaiting listing worth over Rs 33,500 crore this year. A number of companies that have received regulatory approvals have also postponed their IPOs, waiting for a recovery in the indices. Only 3 IPOs have launched in 2020, SBI Cards IPO, Rossari Biotech Ltd, and Mindspace Real Estate Investment Trust. For four months till July, the primary market remained quiet as companies feared a poor listing due to COVID-19. Though 2020 is not expected to go as earlier forecasted there are still a few IPOs in the pipeline for the year including UTI Asset Management Co. Ltd, Angel Broking. More here
Technical View | We have opened above the 11,600 levels and can now eye the 11,700-11,750 level to be achieved sooner than later. It is the first day of the September trading series so the markets might want to evaluate the direction and the modus operandi and perhaps take a fresh view on Monday. The support is at 11,300, says Manish Hathiramani, Index Trader and Technical Analyst, Deen Dayal Investments.
Nestle India chief Suresh Narayanan says that the FMCG major continues to see robust demand across categories and is doing better operationally now versus April-June period.
Buzzing | Shares of state-run mineral producer NMDC rallied over 10 percent after the company approved demerger of Nagarnar iron and steel unit. The move will be value accretive for the minority investors, said ICICI Securities.
Rupee Opens | The Indian rupee opened lower at 73.86 per US dollar as against the previous close of 73.81.
What's fuelling smallcaps? Index rises over 80% in five months, outperforming major indices
Smallcap stocks are now talk-of-the-Street after the massive rally it's seen since March. Majority of investors, mutual funds and portfolio management services (PMS) have replaced their bets with smallcaps. In the last five months, the Nifty Smallcap100 index has zoomed over 80 percent, outperforming the benchmark indices. Stock market analyst Basant Maheshwari said the biggest returns can be made by buying a smallcap. Recently, Morgan Stanley said the smallcaps will see an upsurge in the near future. The broader market's relative performance is helping as a forward-looking stock market is possibly anticipating better growth. More here