Sensex, Nifty Fall Dragged By Banking Stocks; FMCG Stocks Led By HUL Limit Decline, FPIs Stayed Net Sellers

Overseas investors remained net sellers for the second day in a row, on Thursday.

As per data from the National Stock Exchange, foreign portfolio investors net sold equities worth Rs 2,509.55 crore today.

Domestic institutional investors, remained net buyers for the third straight day and bought equities worth Rs 263.07 crore today.

Institutions have net sold Rs 1,868.76 crore worth of equities this month so far and Rs 35,251.84 crore worth of Indian equities till date in 2022.

Yield on the 10-year bond rose 9bps to 7.33% during the session. The 10-year bond yield closed at 7.31%.

This is the most the 10-year bond rose in six weeks.

Source: Bloomberg

Rupee fell 89 paise to fresh low of 80.87, during the session. The currency closed around the same level.

This is the most Rupee fell against U.S. Dollar since Russia began its invasion of Ukraine of February 23, which spooked global equity and currency markets.

Source: Bloomberg

India's stock benchmarks declined amid slide in global equities after U.S. Federal hiked interest rate by 75bps for the third successive time. Banking, energy stocks decline while consumer durables, FMCG and auto stocks gained.

The Sensex shed over 330 points (0.57%) to 59,119.72. The Nifty fell 0.5% to 17,629.80. Today 22 of Nifty 50 stocks rose while 28 fell. Titan, Hindustan Unilever, Asian Paints, Eicher Motors, Maruti Suzuki were the top gainers. Power Grid, Axis Bank, HDFC Bank, HDFC, ONGC were the top losers.

The broader indices outperformed their larger peers with MidCap gauge gaining 0.5% and SmallCap measure adding 0.6%. Ten of the 19 sectoral indices compiled by BSE adanced with FMCG index jumping 1.3%. On the flipside, Bankex fell 1.4%.

The market breadth is skewed in the favour of bulls.About 1,816 stocks rose, 1,627 fell and 146 remained unchanged.

• Rupee depreciates 83 paise to fresh low of 80.81, during the session.

Source: Bloomberg

• Shares of LIC declined to Rs 648 apiece, lowest level since listing.

Source: Bloomberg

Shares of GMM Pfaudler rose over 4%, most in over a week since September 13.

Trading volume is 1.3 times the 30-day average. All three analysts tracking the company maintain 'buy'. The return potential of the stock is 16.6%.

The company received UK government's approval to acquire the balance 46% stake in GMM International.

Source: Exchange Filing, Bloomberg

Shares of Suzlon Energy jumped over 12.2%, most in nearly two weeks.

The company, in an exchange filing post market hours Wednesday, said that it will decided terms and conditions of its proposed rights issue at a board meeting on September 25, Sunday.

Trading volume is twice the 30-day average. Share price crossed above 200-day simple moving average, indicating potential upward price momentum.

Source: Exchange filing, Bloomberg

European markets decline amid slide in global equities, after U.S. Federal Reserve implemented thid consecutive 75bps rate hike on Wednesday.

Source: Bloomberg

Yield on the 10-year bond rose 9bps, most in a week, to 7.33%.

Source: Bloomberg

• SpiceJet has hiked the salary of its captains and senior first officers by around 20% from October.

• This comes as the airline gets the first tranche of funds under the government's emergency credit line guarantee scheme.

• The budget carrier is also expected to deposit TDS of all employees in the next two to three weeks.

• Earlier, SpiceJet had put 80 of its cockpit crew on leave without pay for 3 months to rationalise costs.

Source: PTI

India's stock benchmarks declined, amid slide in global equities after U.S. Federal Reserve hiked interest rate by 75bps, dragged by financial services, energy, realty stocks.

The Sensex lost over 430 points or 0.7% to 59,021.03. The Nifty 50 fell by the same magnitude to 17,589.05. Among Nifty 50 constituents, 14 stocks rose while 36 fell.

Hindustan Unilever Ltd, Eicher Motors Ltd, ITC Ltd, Asian Paints Ltd and Adani Ports and SEZ Ltd. were the top gainers. Bajaj Finserv Ltd, Power Grid Corporation of India Ltd, SBI Life Insurance Company Ltd, Shree Cement Ltd and HDFC Life Insurance Company Ltd were the top losers.

The broader indices outperformed their larger peers, MidCap gauge losing 0.25% and SmallCap measure shedding 0.12%. Barring FMCG, all the other 18 sectoral indices compiled by BSE Ltd. declined, with Energy, Financial Services, Bankex, Oil & Gas and Realty falling over 1%.

The market breadth is skewed in the favour of bears. About 1,366 stocks rose, 1,948 fell and 151 remained unchanged.

The current business scale and flexibility in cost structure allowed Indian information technology services companies the margin leverage, according to Bernstein.

The global asset management firm identified pricing power from customers, wage inflation, currency, pyramid mix/offshoring as key variables driving EBIT margins of Indian I.T. firms. Higher offshoring and better pyramid mix are the levers supporting margins.

Source: Bernstein note, September 20

• SBI emerged as least efficient among Asian peers in the June quarter owing to higher notional losses on investment book

• Cost-to-income ratio swelled by 9.11 percentage points to 71.06% for SBI in June, denoting the steepest rise among peer banks.

• Japanese banks were least efficient after SBI, while Chinese lenders were most efficient.

Source: S&P Global Market Intelligence statement

Telecom-linked firms advanced after the government introduced draft rules. The draft Indian Telecommunication Bill, 2022 includes proposals on takeover norms and airwaves trading. They also seek to regulate services provide by OTT platforms.

Shares of GTL Infra, Astra Microwave, Sterlite Technologies, Tejas Networks gained while Airtel, Vodafone Idea, ITI reversed early gains.

Source: Bloomberg, Draft Indian Telecommunication Bill, 2022

Aurobindo Pharma's U.S. subsidiary Aurolife Pharma received establishment inspection report (EIR) for its plant in Raleigh, North Carolina, mentioning the inspection a voluntary action initiate (VAI) from U.S. FDA.

Source: Exchange filing

Shares of Fortis Healthcare tumbled over 11.5%, most in two years. Trading volume is more than 14 times the 30-day average.

The fall comes after Supreme Court refused to lift the halt on IHH Healthcare's open offer for Fortis and ordered a forensic audit on the share sale. In its order on Daiichi's petition on Fortis sale to IHH, the apex court asked Delhi High Court to decide on Fortis open offer.

The order comes on Japanese pharma firm Daiichi Sankyo's petition challenging the Fortis-IHH deal. Daiichi sought to recover Rs 3,600 crore arbitration award against Fortis's former promoters, Malvinder Singh and Shivinder Singh.

Supreme Court also ordered six-month jail for Malvinder Singh and Shivinder Singh.

Malaysian firm IHH Healthcare bought 31% stake in Fortis in 2018 for $1.1 billion. Daichii had objected the sale of pledged shares in Fortis as it claimed rights over the shares.

All 11 analysts tracking the company maintain 'buy'. The return potential of the stock is 13.4%

Source: Bloomberg

Shares of KPI Green Energy rose nearly 5%, most in a week.

Trading volume is 0.8 times the 30-day average.

The rise in the solar plants designer and builder comes after KPI Green bagged new order for executing Wind-Solar 'Hybrid Power Project of 5.4 MW capacity from Greenlab Diamonds.

Source: Exchange filing, Bloomberg

Shares of Ashoka Buildcon rose over 4.6%, most in over two weeks. Trading volume is more than five times the 30-day average.

The company won a project worth Rs 258.12 crore from South Western Railway for construction of new BG line, including electrical and telecommunication works, on engineering, procurement and construction mode, according to an exchange filing post-market hours Wednesday. The project is to be completed within 24 months.

Of the 17 analysts tracking the company, 16 maintain 'buy' and one suggests 'hold'. The return potential of the stock is 60.3%.

Source: Bloomberg, Exchange filing

Shares of SpiceJet fell 5.5%, most in three weeks since September 1. Trading volume is more than twice the 30-day average.

The fall comes after aviation regulator DGCA extended SpiceJet's suspension to operate at 50% capacity till October 29. The ban was to be lifted on Wednesday.

DGCA had issued a show-cause notice to SpiceJet after several incidents of technical snags in June and July.

Of the 10 analysts tracking the company, two maintain 'buy', four suggest 'hold' and four recommend 'sell'. The return potential of the stock is -4.5%.

Source: DGCA order, SpiceJet

Shares of Welspun Corp rose over 5.3%, and are on course to extend gains for the fourth. The stock hit a 14-year high in today's session.

The sharp uptick comes after the liquidator of ABG Shipyard declared Welspun as a successful bidder in terms of process memorandum for private sale of some assets belonging of ABG Shipyard under Insolvency and Bankruptcy Code.

Welspun Corp and its unit Nauyaan Shipyard paid Rs 659 crore towards entire purchase consideration.

The partially built obsolete ships and scrap acquired under Welspun is estimate to over 1,50,000 MT. The potential value from the acquisition would be unlocked within 12-15 months from completion of the purchase, the company said in an exchange filing on Thursday.

Trading volume is more than eight times the 30-day average. The relative strength index is at 71, suggesting it may be overbought.

Source: Exchange filing, Bloomberg

Shares of Bharat Electronics rose over 3%, most in over a week since September 12.

Trading volume is 1.1 times the 30-day average.

The rise comes after Jefferies reiterated 'buy' and raised target to Rs 130 from Rs 103.33, an implied upside of 19.87%.

In a note on Wednesday, Jefferies noted that over 200 items have been added to defence embargo list through 2007, emphasising the shift to indigenisation and raised FY24-25E EPS by 2-6% to reflect better revenue growth due to domestic manufacturing.

Jefferies expects Bharat Electronics to be a key beneficiary of indigenisation as 193 items out of 1,100 on the import embargo list are manufactured by BEL. The company had earlier said that defence ministry is in discussions with BEL to find alternatives for Russian vendors and equipment.

Of the 29 analysts tracking the company, 24 maintain 'buy', three suggest 'hold' and two recommend 'sell'. The return potential of the stock is -4.9%.

Source: Bloomberg, Jefferies note

India's stock benchmarks declined as slide in global equities deepened after U.S. Federal Reserve hiked interest rates by 75bps.

Banking, information technology, information technology stocks declined.

The S&P BSE Sensex lost over 450 points (0.75%) to 58,997.77. The NSE Nifty 50 declined 0.7% to 17,596.40. Eleven of the Nifty 50 stocks rose while 39 fell. SBI Life, Power Grid, Tech Mahinra, HDFC and Bajaj Finserv are among the top losers among the Nifty 50 constituents.

The broader indices outperformed their larger peers with MidCap measure losing 0.2% and SmallCp index gaining 0.1%. Fourteen of the 19 sectoral indices compiled by BSE Ltd. declined with Realty index losing 1%.

The market breadth is skewed in the favour of bulls. About 1,338 stocks rose, 1,052 fell and 118 remained unchanged.

• Yield on the 10-year bond rose 5bps to 7.29%, at the open.

Source: Bloomberg

Indian currency fell 49 paise to 80.47 against the U.S. dollar.

Source: Bloomberg

• Bharti Airtel has 94 million shares traded pre-market in two large trades.

• Details of buyers, sellers are not known immediately.

Source: Bloomberg

• U.S. Dollar Index at 111.6

• U.S. 10-year bond yield at 3.54% on Wednesday

• Brent crude down 0.22% to $89.63 per barrel

• Nymex crude at $82.76 per barrel

• SGX Nifty down 0.5% to 17,628.5 as of 6:18 a.m.

• Bitcoin down 2.6% to $18,419.8

Source: Bloomberg

• Adani Ports And Special Economic Zone: The company has won a Rs 25,000 crore project to the Tajpur deep sea port in West Bengal. The greenfield project will see Rs 15,000 crore utilised toward port development and the rest toward building related infrastructure.

  Meanwhile, Avantika Singh Aulakh, VC and CEO, Gujarat Maritime Board, has resigned from Adani Port’s board.

• State Bank of India: State Bank of India has raised Rs 4,000 crore Basel III compliant Tier 2 bonds at coupon rate of 7.57%. The bonds have a tenor of 15 years with a call option after 10 years and on anniversary dates thereafter.

• Reliance Industries: The company’s CFO Alok Agarwal plans to sell 2.25 lakh shares between May 10 to August 31, 2023. He also will gift 1.25 lakh shares between May 10 to May 31, 2023.

• SpiceJet: Aviation regulator DGCA has extended the 50% limit on SpiceJet’s number of flight departures until Oct. 29 as a matter of ‘abundant caution’. The airline will be subjected to "enhanced surveillance" during this period, DGCA said.

• Vedanta: The Union Cabinet has approved tweaks in the scheme for semiconductors and display manufacturing ecosystem. Under the modified program an uniform fiscal support of 50% of project cost shall be provided for semiconductor fabs across all technology nodes. The reformed scheme will also provide fiscal support of 50% of capital expenditure for setting up of compound semiconductors/silicon photonics/sensors/discrete semiconductors fabs.

• Reliance Industries/Adani Enterprises/Tata Power: The Union Cabinet approved a Rs 19,500-crore production linked incentive scheme on 'national programme on high efficiency solar PV modules' with an aim to attract Rs 94,000 crore investment in the sector.

• Kirloskar Oil Engines: The company will acquire balance stake in Ahmedabad-based La-Gajjar Machineries, making the latter a 100% subsidiary. It had acquired 76% stake in LGM in 2017 with an agreement that the balance holding will be acquired over a 5-year period.

  Kirloskar Oil Engines has also appointed Anurag Bhagania as chief financial officer, with effect from Sept. 22.

• Future Enterprises: The Registrar of Companies, Mumbai has granted the company an extension of three months for holding the AGM for fiscal ended March 2022, i.e., by December 31, 2022.

• Megasoft: The company has paid over Rs 56 crore to Extrovis AG for 15.25% of additional equity stake in the second tranche of acquisition.

• DLF: DLF Cyber City Developers, a material subsidiary unit of DLF, has allotted 5,000 NCDs to raise Rs 500 crore.

• IDBI Bank: The bank has completed the sale of its entire stake in Ageas Federal Life Insurance Company to Ageas Insurance International NV. IDBI Bank sold 20 crore shares, representing 25% stake in AFLI, to Ageas.

• Punjab National Bank: The bank has raised Rs 658 crore through Basel Ill compliant additional Tier-I capital bonds at a coupon of 8.3%.

• Ashoka Buildcon: The company has won a project worth Rs 258.12 crore from South Western Railway for construction of new BG line, including electrical and telecommunication works, on engineering, procurement and construction mode. The project is to be completed within 24 months.

• Heritage Foods: The board of the company will meet on Sept. 30 to consider and approve raising of funds by way of issue of equity shares on a rights issue basis.

• PB Fintech: The company has invested around Rs 650 crore in its wholly owned subsidiary Policybazaar Insurance Brokers, and another Rs 250 crore in wholly owned subsidiary Paisabazaar Marketing and Consulting.

• Triveni Engineering & Industries: The company has divested its entire stake in Triveni Turbine, representing 21.85% of the entire shareholding of the latter. The company sold 10% stake to Rati Sawhney, an existing promoter, and the remaining 11.85% stake to various global and domestic investors through block trading window.

• KPI Green Energy: The company has a new received a new order from Greenlab Diamonds, Surat for executing wind-solar hybrid power project of 5.40 MW capacity under the 'captive power producer business segment.

• Suzlon Energy: The company's board will meet on Sept. 25 to consider and approve the terms and conditions of the rights issue approved on Aug. 10, including determination of the price.

Share market declines deepened in Asian trading amid diminishing odds of a soft economic landing after the Federal Reserve hiked interest rates by 75 basis points.

Shares fell in China, Japan and South Korea, while U.S. futures dropped after the S&P 500’s slide overnight took it more than 20% below the record high in January. Russia’s escalation of its war with Ukraine and tensions between Beijing and Taiwan, further hurt sentiment.

At 8:00 a.m., the Singapore-traded SGX Nifty--an early barometer of India's benchmark Nifty 50--traded 0.83% lower at 17,570 points.

Source: Bloomberg