Stock Market Highlights: Indian shares ended over 1 percent lower on Monday with selling witnessed across all sectors led by auto, metals and banks. The benchmarks were mainly led by a fall in heavyweight Reliance Industries, which fell 4 percent after a Singapore arbitration panel put its deal for Future Group assets on hold.
Thank you readers! Here are the key highlights from today's session
- Sensex & Nifty Erase Gains Of The Last Week, Slip Over 1% Each
- Midcap Index & Nifty Bank Fall In-line With Sensex & Nifty
- 39 Nifty Stocks Close In The Red With Autos Being Top Losers
- Sensex Slips 540 Points To 40,146 & Nifty 163 Points To 11,768
- Nifty Bank Falls 403 Points To 24,075 & Midcap Index 296 Pts To 17,010
- 2-wheeler Stocks Fall On Auto Dealer Association’s Comment Of Weak Demand
- Hero Moto & Bajaj Auto Fall Over 6% Each, Eicher Slips 3%
- RIL & Future Grp Stocks Slip After S’pore Arbitrator’s Order In Favour Of Amazon
- Kotak Mahindra Bank Gains 2% On Better-than-expected Q2 Earnings
- IndusInd Bank Closes 1% Higher On Bloomberg’s Rpt Of Merger With Kotak
- L&T Moves 1% Higher Ahead Of Special Dividend Announcement
- Market Breadth Favours Declines; Advance-Decline Ratio At 1:2
Closing Bell: Sensex, Nifty end 1% lower dragged by RIL, metals
Indian shares ended over 1 percent lower on Monday with selling witnessed across all sectors led by auto, metals and banks. The benchmarks were mainly led by a fall in heavyweight Reliance Industries, which fell 4 percent after a Singapore arbitration panel put its deal for Future Group assets on hold. The Sensex ended 540 points lower at 40,145 while the Nifty lost 163 points to settle at 11,768. Broader markets were also lower for the day with Nifty Midcap and Nifty Smallcap down 1.7 percent and 1 percent, respectively. All sectors were also in the red. Nifty Metal and Nifty Auto fell the most around 3.5 percent each while Nifty Bank shed 1.5 percent and Nifty IT shed 1.2 percent. On the Nifty50 index, HDFC Life, Kotak Bank, Nestle, IndusInd Bank and L&T were the top gainers while Hero Moto, Bajaj Auto, Hindalco, M&M, and UPL led the losses.
DHFL creditors' committee meet today; lenders may seek revised offers
The committee of creditors for Dewan Housing Finance Limited (DHFL) is meeting today to deliberate on the four offers received for the firm under the Insolvency & Bankruptcy Code (IBC). CNBC-TV18 was the first to report on the bids received for DHFL on October 17. US-based distressed asset fund Oaktree Capital Management has offered the highest recovery to lenders with an offer of Rs 28,000 crores for its entire book, CNBC-TV18 had earlier reported. Piramal Enterprises has offered Rs 15,000 crore in total to acquire DHFL’s retail book. Adani Properties’ offer for the wholesale book is about Rs 1,600-1,800 crore, added one of the sources. More here
No festive cheer: Rajiv Bajaj says commuter bike demand remains pressured
The expected recovery in two-wheeler sales during the festive season may have come a cropper, especially in the low-end 100cc segment, Bajaj Auto MD Rajiv Bajaj said. Bajaj was responding to a report by the Federation of Auto Dealers Association (FADA), which said two-wheeler demand during the festive season will be lower than last year. Bajaj told CNBC-TV18 that sales for the company’s 100 cc motorcycles were down 30 percent even as premium motorcycle sales witnessed growth. He added that 3-wheeler sales were at 40 percent of last year. Watch video for more
IndusInd Bank's shares rise 4% over Kotak Mahindra Bank takeover buzz
IndusInd Bank's share price surged up to 4 percent on Monday after reports said that Kotak Mahindra Bank is in talks to acquire the private lender. The stock gained as much as 4.16 percent to Rs 633.30 per share on the NSE. The Bloomberg report dated October 25 said that founder and chief executive Uday Kotak has held initial talks with the promoters of IndusInd, in which the Hinduja family could retain a stake in the merged entity after a deal. However, IndusInd Bank denied it and said, "IndusInd International Holdings Limited (promoter), completely denies the said rumour and considers it malicious, untrue and baseless. IIHL is promoted by the Hindujas and broad base of other successful NRIs from the overseas Indian diaspora. They reiterate their full support to the IndusInd Bank, now and always."
H2 would be much better, expect loan growth to improve, says Yes Bank's CEO
Yes Bank reported better than expected earnings for the second quarter of fiscal 2021 on account of improvement in net interest margins (NIMs) and reduction in operating expenses. Speaking to CNBC-TV18, Prashant Kumar, MD and CEO of Yes Bank said that the second half of this fiscal would be much better. “If we don’t have any negative surprise from the pandemic, our second half would be much better,” Kumar said adding that the bank was seeing better demand from the market in terms of credit. The bank has been able to bring in large number of new customers. Watch video for more
Yes Bank shares pare gains to decline over 3% despite better than expected earnings
Shares of YES Bank fell over 3 percent on Monday even after the bank turned profitable in the September quarter. Yes Bank reported a net profit of Rs 129.4 crore in the second quarter of fiscal 2021 as against a net loss of Rs 600 crore in the same period last fiscal. Earnings beat CNBC-TV18 analysts' expectations as it had estimated a loss of Rs 306.8 crore and NII of Rs 1,841.8 crore. Earlier in the day, the stock rose 5 percent to Rs 14 per share on BSE but later pared gains to fall 3.3 percent to Rs 12.90. Post the earnings, ICICI Securities reinitiated coverage on the stock with a 'hold' and target price of Rs 14. It becomes tricky to assess YES Bank, from a stock call perspective, especially during its consolidation/turnaround phase, the brokerage noted.
Market Watch: Ruchit Jain of Angel Broking
Grasim looks weak. The stock has probably formed a rising wedge pattern on the daily charts and usually such patterns are formed in the last leg of an up move. So probably the stock should correct and head towards its support of Rs 746 at current levels. One can go short with a stop above Rs 790 for the target of Rs 746.
Adani Ports & SEZ in spite of the fall in the market has been showing some strength. If you look at the volumes in the last 3 trading sessions along with price up move, the volumes have been decreasing gradually. So, I think this would tend to outperform. Keeping a stop below Rs 355 from a trading perspective, traders can buy for a target of Rs 390.
Kotak Mahindra Bank Q2 net profit rises 27% to Rs 2,185 crore; NII up 16% YoY
Kotak Mahindra Bank reported a 26.6 percent rise in net profit for the quarter ended September 2020 at Rs 2,184.48 as against Rs 1,724.48 crore in the same period last year. CNBC-TV18 analysts' poll had an estimated profit of Rs 1,394.4 crore.
Net Interest Income (NII) in Q2FY21 increased 17 percent to Rs 3,913 crore from Rs 3,350 crore, YoY. Net Interest Margin (NIM) during the quarter under preview was at 4.52 percent.
Operating profit increased by 31 percent to Rs 3,297 crore from Rs 2,509 crore in the year-ago period. Read more here.
Market Watch | Yogesh Mehta, Founder of Yield Maximisers
Buy Adani Ports. One can initiate a buy position here with a stop loss of Rs 363 and a target of Rs 385 on the higher side.
One can initiate a long position on HDFC Life with a stop loss of Rs 562, target in the range of Rs 600.
One can initiate a long position on Tata Consumer keeping a stop loss of Rs 467 and a target of around Rs 497.
Earnings Review: Brokerages bullish on JSW Steel post Q2, stock falls 4.5%
Shares of JSW Steel fell 4.5 percent on Monday after the company announced its September-quarter results. The company reported an over 37 percent decline in consolidated net profit at Rs 1,595 crore in the quarter under review as compared to Rs 2,536 crore posted in the year-ago quarter. The sentiment was also affected as brokerages remained bearish on the stock post its Q2 earnings. Credit Suisse downgraded the stock to 'neutral' from 'outperform' but raised its target to Rs 300 per share from Rs 200 earlier. It added that it does not see risk-reward favourable anymore. Meanwhile, CLSA maintained a 'sell' call on the stock but has raised the target price to Rs 245 per share from Rs 220 earlier. It expects the margin to peak in Q3 and then taper down.
JSW Steel Q2: Exports of iron ore in the first six months, says Seshagiri Rao
It was a good show from JSW Steel as revenue beat is driven by higher volumes, sequentially higher prices and a better sales mix. “The Q2 standalone EBITDA per tonne at Rs 10,140. It’s strong on higher volume, better sales mix and higher realisations,” said Seshagiri Rao, Joint MD & Group CFO of the company in an interview with CNBC-TV18.
"Exports of iron ore in the first six months of this year are more than doubled. So that is a bit of a concern. The domestic industry is suffering from lack of iron ore as a lot of exports are happening from India.” he further added. Watch video for more
Coal Scam: Former Union Minister Dilip Ray sentenced to 3 years in jail
The Special CBI Court in New Delhi today sentenced former Union Minister Dilip Ray to three-year imprisonment in a coal scam case related to the alleged inconsistencies in the allocation of a Jharkhand coal block in 1999. On October 6 this year, the court had already convicted Ray, the then minister of state (coal) in the Atal Bihari Vajpayee government, along with the then Additional Coal Secretary Pradip Kumar Banerjee and Ministry of Coal (Projects)’s adviser Nityanand Gautam. More here
Nilesh Shah of Kotak Mahindra AMC says festive season demand will support market; prefers IT stocks
In an interview with CNBC-TV18, Nilesh Shah, Managing Director at Kotak Mahindra Asset Management said that earnings have been above expectations so far. He added that US elections will have a short-term impact on the market but as long as the festival season continues to spurt demand and push recovery ahead, the market will be supportive. On the domestic front, Shah expects IT stocks to sustain current valuations. Lack of normalcy returning to the economy will push investor allocation towards IT stocks which can sustain the valuation, he suggested. Watch video for more
Rate of jump in health insurance claims a worry; optimistic on motor insurance biz: ICICI Lombard
A spike in COVID claims pushed up the loss ratio in the health insurance business for ICICI Lombard in the second quarter, even though the motor segment saw lower claims. CNBC-TV18 spoke to CEO of ICICI Lombard for an outlook on COVID claims going forward and for a check on new motor policy sales as the festive season begins. Bhargav Dasgupta, MD & CEO, ICICI Lombard General Insurance, said that the total aggregate claims that the industry has seen in the six months are roughly about 3,24,000. "For us at ICICI Lombard, the number is at about 17,000, which is largely in line with our market share," he said. The cause of concern, however, is largely the rate at which the claims have climbed, as per Dasgupta. "If we see the October number, the number seems to be plateauing, in fact tapering a bit," he says. More here
Dilip Buildcon | The company has executed a concession agreement With NHAI for project worth Rs 1,905 crore.
Technical View | Nifty’s range for the week ahead is between 11,750 and 12,050. The last two trading sessions have witnessed apathetic volumes because of which we have been trading in a lacklustre fashion all of last week. Since this is expiry week, we should expect additional volumes to flow in so that a direction in the Nifty can be witnessed, says Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments..
AstraZeneca resumes COVID-19 vaccine trial in US; Johnson & Johnson prepares for the same
AstraZeneca has resumed the U.S. trial of its experimental COVID-19 vaccine after approval by regulators, and Johnson & Johnson (J&J) is preparing to resume its trial on Monday or Tuesday, the companies said on Friday. The news signaled progress against the novel coronavirus that has infected more than 41 million globally, including 8 million Americans and comes 10 days before a U.S. presidential election that may hinge on plans to fight the pandemic. AstraZeneca, one of the leading vaccine developers, paused its U.S. trial on September 6 after a report of a serious neurological illness, believed to be transverse myelitis, in a participant in the company's UK trial. J&J paused its large, late-stage trial last week after a study participant became ill. Both companies have contracts to provide vaccine to the United States and other governments if they are cleared by regulators.
Gold hits over one-week low as dollar gains ground
Spot gold fell 0.1 percent to $1,898.28 per ounce by 0347 GMT, after hitting $1,890.19, its lowest since October 15. US gold futures were down 0.3 percent at $1,899.30. “In the near-term, there seems to be a lack of impetus to find extra buyers (for gold)... A lot of it is because we’re trading in the looming shadow of the US elections and stimulus speculation,” said IG Markets analyst Kyle Rodda. The dollar index was up 0.2 percent against a basket of currencies.
Future Group-RIL deal on hold: RIL down 2%, Future Retail tanks 9%
Reliance Industries and Future Group stocks on Monday after the Future Group-RIL deal was stayed granting relief to Amazon. A Singapore arbitration panel has put on hold Future Group's $3.38 billion asset sale to Reliance Industries, an interim win for Amazon. The stock fell as much as 2.2 percent to Rs 2,064.45 per share on BSE. Meanwhile, Future Group stocks also decline post the stay order. Future Retail shed over 9 percent to Rs 70.55, while Future Enterprises and Future Consumer were locked in their respective 5 percent lower circuits on BSE. Amazon had alleged the deal between the Indian firms breached existing agreements and had sought emergency arbitration to seek a stay on the on the deal until the arbitration process is complete, sources told CNBC-TV18.
Reliance reverses salary cut; employees to get arrears
Reliance Industries is restoring salary cuts that it implemented amid the coronavirus lockdown in April-May 2020, retrospectively. The move is significant as it signals economic recovery in the country from the height of the COVID-19 pandemic. Moreover, it indicates that RIL believes the worst of the pandemic is behind us and things look better in future. In a mail sent to 3.5 lakh direct employees in the group’s many businesses, the company said it was reversing the salary cut retrospectively and arrears would be credited to employee accounts, with the October salary. This would put a lot of money to spend in the hands of the group's employees and families and help add to the demand push in the economy. More here
Opening Bell: Sensex opens marginally lower, Nifty hold 11,900; metal stocks fall
Indian shares opened with minor cuts on Monday as Asian peers remained cautious on surging coronavirus cases in Europe and the United States. Gains in FMCG and pharma sectors were capped by losses in metals and IT stocks. At 9:18 am, the Sensex was trading 82 points lower at 40,603 while the Nifty fell 19 points to 11,911. The Nifty Metal index fell 0.8 percent and Nifty IT lost 0.4 percent. Meanwhile Nifty Bank and Nifty Fin Servcies shed 0.2 percent each. However, Nifty FMCG, and Nifty Pharma rose at opening. IndusInd Bank, Nestle, L&T, Tata Motors, and NTPC were the top gainers while JSW Steel, Tech Mahindra, RIL, Tata Steel, and SBI led the losses.
RBI Governor tests positive for coronavirus
RBI Governor Shaktikanta Das said on Sunday he had tested positive for the coronavirus, the latest high profile name in the country to contract the virus. “I have tested Covid-19 positive. Asymptomatic. Feeling very much alright,” Das said in a tweet. “Will continue to work from isolation. Work in the RBI (Reserve Bank of India) will go on normally,” he said. Many top Indian politicians including Home Minister Amit Shah and actors such as Amitabh Bachchan have tested positive for the virus, and since recovered.