Sensex, Nifty Erase Most Of Losses As Banking, Metal Gains; FPIs Turn Net Sellers

India's stock benchmarks declined, but pared most of the losses, as gains in metals, banking, basic materials almost offset decline in information technology, realty, oil & gas, after sharp slide in Wall Street overnight as hotter-than-expected inflation reading spooked markets.

The Sensex lost 0.37% (224 points) to 60,346.97, almost a 1,000-point recovery from the day's low of 59,417.12. The Nifty 50 also recovered from the gap-down start to close above 18,000 for the second session in row.

Both the Sensex and Nifty snapped a four-day winning streak. Today 21 of Nifty 50 stocks rose, 29 fell. IndusInd Bank, NTPC, Power Grid, SBI, Kotak Mahindra Bank were among the top gainers. Information technology stocks Infosys, Tata Consultancy Services, Tech Mahindra, HCL Technologies, L&T were the top losers.

The broader indices outperformed their larger peers, with MidCap gauge losing 0.1% and SmallCap gauge closing little changed. Thirteen of the 19 sectoral indices compiled by BSE Ltd. declined.

The market breadth was skewed slightly in the favour of bears. About 1,692 stocks rose, 1,775 fell and 144 remained unchanged.

Overseas investors turned net sellers after six days of net buying on Wednesday.

The longest buying stretch by FPIs, this year so far, lasted 13 days from July 28 to August 17.

As per data from the National Stock Exchange, foreign portfolio investors net sold equities worth Rs 1,397.51 crore today.

Domestic institutional investors, on the contrary turned net buyers and bought equities worth Rs 187.58 crore today.

Institutions have net bought Rs 4,405.61 crore worth of equities this month so far and have net sold Rs 29,077.47 crore worth of Indian equities till date in 2022.

• Yield on the 10-year bond rose 5bps to 7.13%, before closing at 7.12%.

• This is the most the 10-year yields rose in over two weeks since August 29.

Source: Bloomberg

The Indian currency depreciated 46 paise, most in over a month since August 4, to 79.60, during the session.

Rupee eased off to close at 79.44, against the greenback, even as stock markets recovered most of the losses after a gap-down open.

Source: Bloomberg

Shares of Power Grid Corp of India rose 2.5%, most in over a month since August 12.

About 3.91 million shares of Power Grid changed hands in a large trade, according to Bloomberg data. Details of buyers, sellers are not known immediately.

Trading volume is nearly thrice the 30-day average. Of the 25 analysts tracking the company, 19 maintain 'buy', five suggest 'hold' and one recommends 'sell'. The return potential of the stock is 2.7%.

Source: Bloomberg

Shares of RattanIndia Enterprises rose nearly 8%, most in three weeks since August 22.

Trading volume is twice the 30-day average.

The company launched 'Defender' by its unit Throttle Aerospace Systems.

Defender, an indigeneously developed tracking and capturing system for rogue drones, is loaded with 13 Artificial Intelligence features to neutralise threats before they can cause harm.

Defender can move at top speeds of 26 metre per second with range up 20 km

Source: Exchange filing, Bloomberg

• Indian currency depreciated 46 paise, most in over a month since August 4, to 79.60, during the session.

• The Rupee recovered some of the losses to 79.40.

Source: Bloomberg

• European markets open lower. Energy stocks fell even as European Commission considered plans to contain the energy crisis.

Source: Bloomberg

Shares of rice exporters gained and are on course to advance for third day.

This comes after India imposed 20% duty on shipments of while and brown rice and banned broken rice sales abroad, on September 9. The curbs apply to roughly 60% of India's overall rice exports.

"As the world's biggest exporter of rice, India's move to stabilise domestic prices over global demand will likely have near-term inflationary consequences, especially within the region', Rahul Bajoria, MD & Chief India Economist, Barclays, wrote in a note.

The export restrictions have led to surge in top exporters LT Foods, Chaman Lal Setia and KRBL.

Source: Bloomberg, Barclays note

• Harsha Engineers International’s IPO was fully subscribed as of 1:06 p.m. on day 1.

• Bidding was led by non-institutional investors (1.35x) and retail investors (1.43x).

• The offer closes on Friday.

Source: BSE

India's stock benchmarks tumbled at the open, amid slide in global equities after a sharp selloff on Wall Street following a hotter-than-expected U.S. inflation data. But Sensex and Nifty pared most of the losses, aided by gains in FMCG, Financials and Metal stocks, while IT stocks declined.

The Sensex lost 150 points or 0.24% to 60,424.45 on the BSE. The 30-stock index shed over 1,150 points to an intraday low of 59,417.12. The Nifty 50 fell by similar magnitude to 18,037. Among Nifty 50 constituents, 26 stocks rose while 24 fell. NTPC Ltd , Power Grid Corporation of India Ltd, IndusInd Bank Ltd, State Bank of India and Eicher Motors Ltd were the top gainers. Infosys, Tech Mahindra, TCS, HCL Technologies Ltd and Wipro Ltd were the top losers.

The broader indices outperformed their larger peers with MidCap gauge little changed and SmallCap gaining 0.2%. Eleven of the 19 sectoral indices compiled by BSE gained.

The market breadth is skewed in the favour of bears. About 1,628 stocks rose, 1,705 fell and 138 remained unchanged.

• WPI inflation eased to 12.4% in August 2022 compared to 13.9% in July 2022.

• It fell by 0.5% month-on-month compared to a fall of 1% in July.

Source: Office of the Economic Advisor

Shares of Bajaj Holdings gained nearly 4%, most in this week, after company announced interim dividend of Rs 110.

The Board of Directors today declared an interim dividend of Rs. 110 (1100%) per equity share of face value of Rs. 10, for FY2022-2023. The record date for the purpose of determining the members eligible to receive the interim dividend has been fixed as September 23, 2022.

The interim Dividend shall be credited on or around Monday, 10 October 2022.

Trading volume is quadruple the 30-day average. The relative strength index is at 86, suggesting the stock may be overbought.

The stock has outperformed the stock benchmarks rising 26.5% in 2022 so far, compared to 4.6% gain for Sensex.

Source: Exchange Filing, Bloomberg

Nifty Bank index reclaims 41,000 for the first time in nearly 11 months since October 27, 2021.

Source: Bloomberg

State Bank of India is now the third bank to cross the mark, after ICICI Bank and HDFC Bank.

• Airline Go First’s Twitter account has been compromised.

• The company said it is investigating the matter and working with Twitter to gain control at the earliest.

Source: Company Statement

Shares of Ambuja Cements rose over 5%, most since Monday, after the company announced that it will consider a proposal for raising of funds by way of issue of equity shares or any other means on September 16.

“A meeting of the board of directors of Ambuja Cements is scheduled to be held on September 16, 2022 inter-alia, to consider and evaluate proposal for raising of funds by way of issue of equity shares, convertibles and / or any other eligible securities, on a rights/preferential or any other permissible mode/ and/or combination thereof as may be considered appropriate," the company said.

The Adani family's open offer to acquire an additional 26 per cent stake in Ambuja Cements and ACC had closed on September 9, 2022. The mandatory open offers in cash were made after the Adani family acquired a 63% stake in Ambuja Cements from Swiss cement major, Holcim. Ambuja Cements has a 54.53% stake in ACC.

Trading volume is five times the 30-day average. The relative strength index of the stock is 87, suggesting it may be overbought. Of the 47 analysts tracking the company, 18 maintain 'buy', 17 suggest 'hold' and 12 recommend 'sell'. The return potential of the stock is -25.2%.

Besides Ambuja Cements, other cement makers suh as ACC, Heidelberg Cement, JK Cement, JK Lakshmi Cement advanced.

Nirmal Bang, in a note today, upgraded its view on the sector from 'neutral' to 'positive'. The brokerage firm cited stable competitive intensity, profitability, improved pricing and lower operational costs as reasons for the upgrade.

"ACC and Ambuja operate at higher utilisation levels (80-85%) and meaningful incremental supply from both the firms is likely only after 2-3 years", according to the note, while reiterated that 'profitability of the industry will be maintained in the near term'.

Source: Exchange Filing, Nirmal Bang note, Bloomberg

Disclaimer: Adani Enterprises is in the process of acquiring a 49% stake in Quintillion Business Media Ltd., the owner of BQ Prime.

Shares of fertiliser makers fell in a weak market.

• The fall comes after chemicals and fertilisers minister Mansukh Mandaviya said that the government will not allow fertiliser firms to raise prices of crop nutrients during the winter season

• Speaking at the sidelines of international dairy summit on Tuesday, the minister told reporters that there was no shortage of fertilisers in India. Subsidies for potash and di-ammonium phosphate will be announced shortly for the winter season.

• Shares of Rashtriya Chemicals and Fertilizers, National Fertilizers, Chambal Fertilisers, Coromandel International fell in today's session.

Source: Bloomberg

Shares of Inox Leisure jumped 6% while PVR gained over 2% in a weak market.

The rise comes after Competition Commission of India rejected the complaint against the proposed merger of multiplex chains PVR and Inox Leisure, by CUTS International (Centre for Competition, Investment & Economic Regulation, CUTS C-CIER).

The CCI said that there was no prima facie case as the apprehension of 'appreciable adverse effect on competition (AAEC)' by an entity which is yet to take form cannt be a subject matter of inquiry under Section 3 of the Competition Act, 2022.

The anti-trust body also noted that the dominance per se, even if the proposed transaction is concluded, is not anti-competitive.

CUTS had filed an information with CCI on August 18, urged it to investigate possible anti-competitive effects of proposed merger agreement.

CUTS had listed concerns such as potential reduction in consumer choice, high ticket prices, high bargaining power of PVR-Inox post the proposed merger, due to enhanced market power.

Source: CCI, Bloomberg, CUTS C-CIER

Shares of KEC International gained 4.8% to Rs 449.8 apiece. Trading volume on the power transmission company's stock is nearly 16 times the 30-day average.

The rise comes after the company announced post-market hours on Tuesday that it bagged new orders worth Rs 1,108 crore across its various businesses.

The transmission and distribution business secured orders for T&D, cabling projects in India, Middle East and Africa, with Power Grid among the firms that placed the orders.

The railways business bagged orders pertaining to overhead electrification for Metro - Order for Overhead Electrification, Auxiliary Power supply, SCADA system and associated work. The company will also build train collision avoidance systems under 'Kavach' in consortium.

Besides these, KEC International's oil & gas pipelines business received an order pertaining to laying of cross-country pipeline and associated works in India

Of the 27 analysts tracking the company, 18 remain 'buy', six suggest 'hold' and three recommend 'sell'. The return potential of the stock is 9.5%.

Source: Exchange filing, Bloomberg

India's stock benchmarks tumbled at the open, amid slide in global equities after a sharp selloff on Wall Street following a hotter-than-expected U.S. inflation data. The high inflation has intensified concerns of potential jumbo interest rate hikes by U.S. Federal Reserve.

The S&P BSE Sensex fell over 1150 points (nearly 2%) to 59,417.12. The NSE Nifty 50 declined over 1.6% to 17,771.15. Today 43 of Nifty 50 stocks declined while seven advanced. Tech Mahindra, Infosys, TCS, Wipro, HCL Tech were among the major losers.

The broader indices outperformed their larger peers, losing 0.7%. All the 19 sectoral indices compiled by BSE Ltd. declined with IT index losing over 2% and realty and Metal gauges shedding over 1%.

The market breadth is skewed in the favour of bears. About 836 stocks rose, 1872 fell and 110 remained unchanged.

• Yield on the 10-year bond rose 3bps to 7.11%, at the open.

Source: Bloomberg

• Indian currency depreciated 43 paise (0.55%) to 79.58, at the open.

Source: Bloomberg

• Food and crop companies may be active after a measure of cropprices eased from a two-month high after U.S. inflation data led to expectations of aggressive interest-rate hikes.

• In Focus: ITC, Britannia, Kovilpatti Lakshmi Roller Flour Mills, Adani Wilmar.

Source: Bloomberg

• Chalet Hotels 

• Dhampur Sugar Mills 

• Dharamsi Morarji Chemical  

• Jagsonpal Pharmaceuticals 

• Johnson Controls-Hitachi Air Conditioning India 

• Lemon Tree Hotels 

• Mastek 

• Infosys: The company, along with Palo Alto Networks, has collaborated with Europe based postal operator and parcel and omni-commerce logistics partner Belgium Post to secure the cloud environment and build cyber resilience for Bpost’s mail delivery and logistics services.

• Bharat Forge: Kalyani Powertrain a wholly owned subsidiary of the company and Harbinger Motors Inc. will undertake manufacturing of electric powertrains for medium-duty commercial vehicles though the new JV ElectroForg.

• JSW Steel: The company signed a Memorandum of Understanding with German-based engineering and technology company SMS group for exploring solutions for implementation of the decarbonisation projects across various JSW Steel plants in India. The steelmaker will invest Rs 10,000 crore to bring down GHG emissions by 42% (from the base year 2005 levels) to <1.95 tonnes of CO2 per tonne of crude steel by 2030.

• Ambuja Cement: The company will consider proposal for raising of funds by way of issue of equity shares or any other eligible securities on a rights/preferential or any other mode on Sept. 16.

• Hatsun Agro Products: The company will consider fund raising by way of issue of Equity Shares on a Rights Issue on Sept. 19

• Bajaj Holdings: The company approved interim dividend of Rs 110 per share of face value of Rs 10 each. 

• KEC International: The company has secured new orders of Rs. 1,108 crores across its various businesses.

• Tata Steel/Tata Power: Tata Steel and Tata Power Renewable are planning to raise as much as Rs 1,200 crore and Rs 1,000 crore, respectively, via bonds, Bloomberg reported citing people familiar with the matter.

• Neuland Laboratories: The company’s chief financial officer Deepak Gupta has resigned. He will continue to hold the position till Oct. 13.

• U.S. Dollar Index at 109.88

• U.S. 10-year bond yield at 3.84% on Tuesday

• Brent crude down 0.12% to $93.06 per barrel

• Nymex crude at $87.27 per barrel

• SGX Nifty down 1.7% to 17,784.5 as of 6:50 a.m

• Bitcoin up 0.11% to $22,263

Asian stocks, bonds and currencies tumbled after a broad-based selloff on Wall Street followed a hotter-than-expected U.S. inflation data. The high inflation has triggered expectations of jumbo interest-rate hikes by the Federal Reserve.

Equities in Japan, Hong Kong and Australia slumped after U.S. shares had their biggest drop in more than two years. The S&P 500 lost over 4% and the Nasdaq 100 fell over 5%.

At 7:25 a.m., the Singapore-traded SGX Nifty--an early barometer of India's benchmark Nifty 50--traded 1.83% lower at 18,760 points

Elsewhere, West Texas Intermediate crude was little changed at $87.33 per barrel. Bitcoin fell 10% overnight, the biggest decline since cryptocurrencies plunged in June.