Share Market Today: Sensex, Nifty Tumble Over 1%; IT Stocks Remain Under Pressure
The S&P BSE Sensex was down by 879 points or 1.4% at 61,799.03 while the NSE Nifty 50 was 265 points or 1.42% lower at 18,395.10.
Yield On The 10-Year Bond Rises
The yield on the 10-year bond rose by 5 basis points to 7.27% on Thursday.
Source: Bloomberg
Indian Rupee Falls Against The U.S. Dollar
The Indian rupee depreciated against the U.S. dollar on Thursday.
During the day, the rupee fell as much as 0.4% to 82.77 and finished trading near the day's low at 82.75.
It closed at 82.44 on Wednesday.
Source: Bloomberg
Closing Bell
The Indian benchmark indices fell the most since Nov. 10 declining more than 1% in trade on Thursday.
The S&P BSE Sensex was down by 879 points or 1.4% at 61,799.03 while the NSE Nifty 50 was 265 points or 1.42% lower at 18,395.10.
Britannia Industries Ltd., Hero Moto Corp Ltd., NTPC Ltd., SBI Life Insurance Co., Sun Pharma Ltd. were the top gainers amongst the NSE Nifty 50 constituents.
Whereas, Tech Mahindra Ltd., Titan Co., Infosys Ltd., Grasim Ltd., and Eicher Motors Ltd. were the top laggards in the gauge.
The broader market indices also declined in trade as the S&P BSE MidCap was down by 1.05%, whereas S&P BSE SmallCap was lower by 0.61%.
Nineteen of the BSE's 20 sectoral indices went down, except BSE Oil & Gas ending flat at 0.09%
The market breadth was skewed in favour of the bears. About 1,406 rose, 2,151 declined, and 123 remained unchanged on the BSE.
Poonawalla Fincorp Declines After Announcing Sale Of Housing Finance Arm
The shares of Poonawalla Fincorp fell 5.05% in trade on Thursday, it declined by 5.21% today, the most in eight weeks since Oct. 21.
The company announced the sale of its subsidiary Poonawalla Housing Finance to TPG-affiliate Perseus SG for Rs 3,900 crore.
The stock was trading at 2.9 times its 30-day average trading volume.
Of the 10 analysts tracking the stock, seven maintain a 'buy' rating, two suggest to 'hold' the stock and one recommends to 'sell'.
Source: Bloomberg, Exchanges
Sensex, Nifty Decline More Than 1%
Delhivery Goes Live On ONDC As Logistics Partner
Delhivery announced that they have gone live on 'Open Network For Digital Commerce' as their logistics provider.
Sellers on ONDC will now be able to leverage Delhivery's network of 18,000+ pin codes in India.
Source: Exchange filing
Landmark Cars IPO Fully Subscribed On Day 3.
Landmark Cars IPO was fully subscribed as of 2:09 p.m. on day 3.
Bidding was led by qualified institutional buyers (4.97 times).
The offer closes on December 15.
Source: BSE
Fertiliser Demand "Critical," Says FM
Fertiliser subsidy demand of Rs 1.1 lakh crore "critical" says FM
FM's affirmation on fertiliser subsidy demandaids the rally in fertiliser stocks.
FM urges "self-sufficiency as regards to fertilizer manufacturing in the country".
Source: Bloomberg, FM's Reply In Lok Sabha
European Markets Open Lower Ahead Of ECB's Decision
Airtel, Tech Mahindra To Deploy 5G Captive Private Network At Mahindra’s Chakan Facility
Bharti Airtel and Tech Mahindra will partner to deploy a 5G captive private network at Mahindra’s Chakan manufacturing facility.
The DoT had issued rules for enterprises setting up captive non-public networks in June this year.
Source: Exchange filing
NBFC Assets Likely To Hit Rs 49-Lakh-Crore By March 2024: ICRA
Assets of non-bank lenders are likely to hit Rs 49 lakh crore by March 2024, according to credit rating agency ICRA.
NBFCs will require about Rs 3 lakh crore of additional debt funding to support growth.
Retail assets of NBFCs are likely to grow by 12-14% annually.
Non-performing assets of NBFCs are likely to reduce by 40 basis points year-on-year to 3.8% by March 2023.
Overall net profit margins of NBFCs ate expected to rise from 2.0-2.4% from last fiscal to 2.6-2.9% in this fiscal.
Source: ICRA
L&T Wins Two Significant Orders Worth Rs 1,000-2,500 Crore
Secured two orders for its Asset Management and AdVENT business verticals.
L&T Energy Hydrocarbon-Asset Management has secured an operations and maintenance contract from Vedanta Ltd., Cairn Oil & Gas division.
AdVENT business vertical has received an engineering, procurement and construction contract from a subsidiary of Nippon Sanso Holdings Corporation.
Source: Exchange filing
Eclerx Services Approves Buyback Price At Rs 1,750
The board of Eclerx Services has approved a buyback price of Rs 1,750 apiece.
The company will buy up to 17.15 lakh shares, spending an aggregate amount of up to Rs 300 crore.
The shares represent a 3.38% stake.
The company fixed December 27 as the record date for the buyback.
Source: Exchange filing
Midday Market Update
The Indian benchmark indices shed their two-day gains in trade on Thursday.
The S&P BSE Sensex was down by 397 points or 0.63% at 62,281.38, while the NSE Nifty 50 was 107 points or 0.57% lower at 18,553.40.
SBI Life Insurance Co., Hero Moto Corp Ltd., Britannia Industries Ltd., Tata Motors Ltd., and BPCL Ltd. were the top gainers amongst the NSE Nifty 50 constituents.
Whereas, Tech Mahindra Ltd., Infosys Ltd., Titan Co., TCS Ltd., and HCL Technologies Ltd. were the top laggards in the gauge.
Nifty IT Snaps Two Winning Streak
The NSE Nify IT Index and its constituents declined in trade after two consecutive days of rally on Thursday. The index was lower by about 1.28%.
All the stocks in the gauge fell except L&T Technology Services. Tech Mahindra declined the most by 2.29%, followed by Infosys down XX%, Coforge XX% lower and TCS lower by XX%.
The NSE Nifty IT index has declined as much as 25% so far in 2022—the steepest decline in a calendar year since at least 2008, when the barometer fell 54.56%, according to Bloomberg data.
Source: Bloomberg, Exchanges
PSU Banks Extend Rally After Fed Rate Hike
The PSU banking stocks extended their rally on Thursday, with as many as six PSU banks hitting a 52-week high.
Bank of India: The stock touched its new 52-week high of Rs 103.5 on Thursday.
IDBI Bank: The scrip scaled Rs 60.7, a new high in the last 52 weeks.
India Overseas Bank: Reached a new 52-week high of Rs 35.95 on Thursday.
Punjab National Bank: The stock was at its 52-week high of Rs 61.8.
SBI: After announcing that it will raise Rs 10,000 crore AT1 and hiking MCLR by 25 basis points across tenors, the stock hit a new 52-week high of Rs 629.55.
UCO Bank: The scrip scaled a new 52-week high of 6.55 on Thursday.
The NSE Nifty PSU Bank Index was 1.3% up, with nine out of 12 constituents advancing and three declining in trade.
The index scaled a new 52-week high of 4,617.40 points.
Source: Bloomberg
IRCTC Falls After Govt Decides To Sell 2.5% Stake
The shares of IRCTC Ltd. fell 4.44% after the government announced that they will be selling a 2.5% stake in the company through an offer for sale issue.
The OFS will see the government offload 2 crore shares of the Indian Railways' ticketing arm, at an offer price of Rs 680 per share, the company said in an exchange filing on Wednesday.
The OFS will open on Dec. 15 for non-retail investors and on Dec. 16 for retail investors.
The stock fell as much as 5.25% at opening, the most in over three months since August 29, 2022. The scrip trades at 9.2 times its 30-day average volume.
About 62% of analysts have changed their price targets on the stock over the past month. Of the nine analysts tracking the stock, three maintain a 'buy' rating, one suggests to 'hold' the stock and five recommend to 'sell'.
Source: Bloomberg, Exchange filing
Large Bunch Trade Drives Sapphire Foods Stock
The shares of Sapphire Foods India Ltd. rose to 2.72%, as of 9:34 am on Thursday after 6.82 million shares changed hands in a bunched trade during pre-market.
The company had said in an exchange filing that the promoters Sapphire Foods Mauritius and Sagista Realty Advisors are mulling to sell 40 lakh shares (6.3%) and 1.5 lakh (0.24%) stake, respectively in the company.
Shareholder WWD Ruby will sell 31.77 lakh shares, representing nearly 5% stake.
The stock gained as much as 3.58%, the most since Nov 21. The scrip trades at 20.1 times the 30-day average volume.
Of the 12 analysts tracking the stock, 11 maintain a 'buy' rating on the stock and one suggests to 'hold' the stock.
Source: Bloomberg, Exchange filing
Opening Bell
The Indian benchmark indices slipped in trade on Thursday after the US Federal Reserve hiked interest rates by 50 bps.
After holding on to steady gains through Tuesday and Wednesday, the benchmarks opened lower.
The S&P BSE Sensex opened lower by 148 points or 0.24% at 62,530.07, while the NSE Nifty 50 was 46 points or 0.25% higher at 18,614.40.
SBI Life Insurance Co., IndusInd Bank Ltd., NTPC Ltd., Britannia Industries Ltd., and HDFC Life Co. were the top gainers amongst the NSE Nifty 50 constituents.
Whereas, Tech Mahindra Ltd., Infosys Ltd., HCL Technologies Ltd. Hindustan Unilever Ltd. and Tata Consumer Ltd. were the top laggards of the gauge.
The broader market indices; S&P BSE MidCap and S&P BSE SmallCap outperformed their larger peers, they gained 0.05% and 0.35%, respectively.
Out of the 20 sectoral indices compiled by the BSE, 14 advanced while six declined.
The market breadth was skewed in favour of the bulls. About 1,753 rose, 808 declined and 110 remained unchanged on the BSE.
Source: Bloomberg, Exchanges
Yield On The 10-Year Bond Opens Flat
The yield on the 10-year bond was up by one basis point to 7.23% at open on Thursday.
Source: Bloomberg
Rupee Depreciates Against U.S. Dollar
The local currency declined against the greenback by 17 paise to open at 82.62 on Thursday.
It closed at 82.45 on Wednesday.
Source: Bloomberg
Metal Companies Continue Their Upmove | Trade Setup For Thursday
Federal Reserve Raises Interest Rate By 50 Bps
The U.S. Federal Reserve Bank raised interest rates by 50 basis points on Wednesday and forecasted more hikes to come in the future.
Federal Reserve Chair Jerome Powell dispelled the notion that the central bank would back away from fighting inflation.
The Fed won’t reduce rates until it’s “really confident that inflation is coming down in a sustained way,” he said. And “that will be some time.”
Thus, Powell maintained that rates will stay high for longer, but the market doesn’t buy it, read here to know why.
According to the MLIV Pulse survey conducted by Bloomberg after the Federal Open Market Committee meeting, out of the 112 investors surveyed 52% said they weren’t surprised by the hike. However, 44% said it was more hawkish than anticipated.
That could weigh on stocks and bolster the US dollar for the rest of the year, according to the survey. About 56% said they expect the greenback to end the year higher and the S&P 500 to end the year lower than Tuesday’s close.
Even though the Fed downshifted the rate hike to 50 bp as expected, the tone of the commentary was unexpectedly hawkish. The FOMC statement, 'the ongoing hikes will be appropriate to reach a sufficiently restrictive stance that returns inflation to 2% over time' is hawkish but the market seems to ignore this expecting inflation to cool down earlier than Fed’s expectations. Globally, equity markets would be watching out for the ECB and BoE decisions today, which are also likely to be 50 bp hikes. The Indian market, though not completely decoupled from the mother market US, has been charting a slightly different path exhibiting surprising resilience even in the face of global weakness. This is due to India’s superior growth and earnings prospects, going forward. However, high valuations and rising interest rates are likely to restrain the ongoing rally. Fixed income assets are becoming attractive.V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services
Global Cues
U.S. Dollar Index at 103.77
U.S. 10-year bond yield at 3.49% on Wednesday
Brent crude up 2.50% to $82.70 per barrel
Nymex crude at $77.27 per barrel
SGX Nifty down 0.36% to 18,682 as of 8:05 a.m.
Bitcoin down 1.08% to $17,637.23
Offerings
Sula Vineyards: The IPO was subscribed 2.33 times on its final day. The QIB portion was subscribed 4.13 times. Non-institutional investors placed bids for 1.51 times of their respective portion, while the retail basket was subscribed 1.65 times.
Abans Holdings: The IPO was subscribed 46% subscription on the third day. The QIB portion was subscribed 2.19 times. The HNIs subscribed 17% of their portion, while the retail portion was subscribed 32%.
Landmark Cars: The initial share sale saw 39% subscription on the second day. The QIB portion was subscribed 9%, and non-instituitional investors placed bids for 84% of the portion reserved for them. The retail portion was subscribed 36% and the employees portion was subscribed 2.18 times.
Bulk Deals
Equitas Holdings: CDC Group sold 76.1 lakh shares (2.22%) at Rs 125.1 apiece.
Goodluck India: Arpna Capital Services sold 1.44 lakh shares (0.56%) at Rs 496.1 apiece.
VRL Logistics: Max Life Insurance Company bought 7.02 lakh shares (0.79%), ICICI Prudential Mutual Fund bought 5.91 lakh shares (0.67%), Quant Mutual Fund bought 5.26 lakh shares (0.6%) at Rs 570 apiece, Vijay Basavanneppa Sankeshwar sold 47.9 lakh shares (5.42%) at Rs 570.1 apiece.
Stocks To Watch
IRCTC: The company will offload 2 crore shares, representing 2.5% of its entire shareholding, via a OFS route between Dec. 15 and 16 at a floor price of Rs 680 apiece. The issue will have the option to sell 2 crore additional shares in the event of oversubscription.
Sapphire Foods: Promoters Sapphire Foods Mauritius and Sagista Realty Advisors are mulling to sell 40 lakh shares (6.3%) and 1.5 lakh (0.24%) stake, respectively in the company. Shareholder WWD Ruby will sell 31.77 lakh shares, representing nearly 5% stake.
Poonawalla Fincorp: The company will sell subsidiary Poonawalla Housing Finance to TPG-affiliate Perseus SG for Rs 3,900 crore.
Torrent Pharmaceuticals: The company will co-market its anti-diabetic drug and its fixed dose combinations in partnership with Boehringer Ingelheim India across the country.
Dilip Buildcon: The company executed a contract agreement worth Rs 1,061 crore with Gujarat Metro Rail Corporation via its RBL-DBL JV for metro infrastructure construction near Bheshan under the Surat Metro Rail Project.
Shriram Properties: The company acquired Golden Ira, a plotted development project in North Bengaluru, for Rs 125 crore through its wholly owned subsidiary SPL Housing Projects.
Glenmark Pharmaceuticals: The company will sell its cardiac brand Razel (Rousvastatin) and combinations in India and Nepal markets at Rs 313.7 crore to J.B. Chemicals & Pharmaceuticals.
Biocon: The company initiated clinical study of Itolizumab in patients with ulcerative colitis in India, in collaboration with Equillium Inc.
State Bank of India: The bank will raise Rs 10,000 crore AT1 capital via Basel III compliant debt instrument till fiscal ending March 2024. The bank also hiked MCLR by 25 basis points across tenors, effective Dec. 15.
Thermax: The Mumbai bench of Customs, Excise and Service Tax Appellate Tribunal set aside the excise duty demand notices from earlier years for Rs 1,381.55 crore on goods sold by the company.
Wipro: The company announced the launch of Capco, a new financial services advisory capability for the Middle East market.
NTPC: The company commissioned and started commercial operations at the second part capacity of 67.73 MW, out of 230 MW Ettayapuram solar PV project.
Gulshan Polyols: The company received an order worth Rs 137 crore to supply 22,209.2 kilolitres of ethanol to oil marketing companies. It has also won an order worth Rs 54.4 crore to supply 9,300 kilolitres of ethanol to Nayara Energy.
Power Grid Corporation of India: The board approved investment of Rs 330.61 crore for transmission system for evacuation of power from REZ in Rajasthan.
Tamilnad Mercantile Bank: The bank executed the agreement for marketing the general insurance products under the tie-up arrangement with Kotak Mahindra General Insurance Company.
Indian Metals & Ferro Alloys: Subsidiary company Utkal Coal received compensation of Rs 20.69 crore towards reimbursement of statutory expenses from Ministry of Coal for its Utkal 'C' coal block.
SGX Nifty Indicates A Muted Start
Asian markets opened on a tepid note Thursday, tracking the U.S. stocks after the Federal Reserve hiked interest rates by 50 basis points on Wednesday.
The S&P 500 was down 0.61%, the Dow Jones fell 0.42%, and the Nasdaq declined 0.76% on Wednesday. The Asian markets opened on a cautious note, with the Nikkei 225 easing 0.25%, the Australian ASX declining 0.23%, and the Hang Seng falling 2.12%.
At 8:05 a.m., the Singapore-traded SGX Nifty -- an early barometer of India's benchmark Nifty 50 -- declined 0.36% to 18,682.
The yield on 10-year U.S. treasuries advanced three basis points to 3.49% on Wednesday.
Crude rose 2.7% as moderate inflation sparked hopes of a better outlook and softer landing. Gold futures rose 0.7%.
Overseas Investors in Indian equities stayed net buyers for the second day in a row on Wednesday. Foreign portfolio investors bought equities worth Rs 372.16 crore and Domestic institutional investors continued their buying streak of six continuous days and net bought equities worth Rs 926.45 crore.
Domestic benchmark gauges closed higher for the second day in a row amid expectations of yet another rate hike by the U.S. Federal Reserve.
Rupee registered gains against the U.S. dollar today to end its two-day-long losing streak ahead of Fed’s policy announcement.