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Market ends with minor losses
(15:35, 13 Feb 2020)

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Key market barometers ended with small losses on Thursday. While private banks dragged the indices lower, gains in IT and pharma shares provided support. Trading was volatile due to expiry of weekly index options on the NSE. The sentiment was affected by weak domestic economic data. Shares across the globe were under pressure as the death toll from the coronavirus in mainland China spiked 23% Wednesday amid new counting methods adopted by Chinese health officials.

The barometer S&P BSE Sensex, was down 170.18 points or 0.41% at 41,395.72, as per the provisional closing data. The Nifty 50 index was down 26.55 points or 0.22% at 12,174.65, as the provisional closing data.

Selling was broad based. The S&P BSE Mid-Cap index was down 0.24% while the S&P BSE Small-Cap index lost 0.03%.

The market breadth was negative. On the BSE, 974 shares rose and 1386 shares fell. A total of 162 shares were unchanged. In Nifty 50 index, 21 stocks advanced while 29 stocks declined.

Economy:

The government announced IIP and retail inflation data after market hours yesterday, 12 February 2020. India's Industrial Production (IIP) shrank 0.3% to 133.5 in December 2019 over December 2018. Manufacturing sector output declined by 1.2%. Electricity generation also dipped 0.1%. Mining sector output grew by 5.4% compared with December 2018.

Consumer price inflation in January rose to 7.59%, holding around six-year top. CPI rural inflation rose to 7.73% versus 7.23% in December. January core inflation also surged to 4.8% versus 3.7% in December.

Buzzing Index:

The Nifty Private Bank index declined 1.39% to 17,078.90, underperforming the other sectoral indices on the NSE.

IndusInd Bank (down 3.97%), RBL Bank (down 2.14%), City Union Bank (down 2.11%), Kotak Mahindra Bank (down 1.45%), ICICI Bank (down 1.37%), Federal Bank (down 1.27%), Axis Bank (down 0.99%) and HDFC Bank (down 0.64%) declined.

Yes Bank surged 6.82%. The bank said it has received non-binding expressions of interest from investors including JC Flowers, Tilden Park Capital, OHA UK and Silver Point Capital. Meanwhile, India Ratings and Research has downgraded Yes Bank's long-term issuer rating to 'IND A-' from 'IND A', while maintaining it on rating watch negative (RWN). The downgrade reflects the continued delay and inconclusive quantum of the anticipated equity infusion in Yes Bank. Ind-Ra believes this could adversely impact the bank's franchise and potentially create challenges on asset and liability side.

Stocks in Spotlight:

Among Nifty stocks, BPCL (down 0.33%) and Nestle India (up 0.64%) will announce Q3 earnings today.

Infosys rose 1.60% to ₹ 793.55 while TCS added 0.56% to ₹ 2182.55.

Sterling and Wilson Solar slumped 7.63% to ₹ 277.05. The company reported 73.31% decline in consolidated net profit to ₹ 50.3 crore on a 34.52% fall in revenue from operations to ₹ 1076.4 crore in Q3 December 2019 over Q3 December 2018. Profit before tax or PBT stood at ₹ 62.1 crore in Q3 FY20, down by 72.92% from ₹ 229.4 crore in Q3 FY19.

Bharat Heavy Electricals (BHEL) advanced 1.93% to ₹ 37.05 after it signed a Memorandum of Understanding (MoU) with Joint Stock Company Rosoboronexporr, Russia to undertake joint projects and operations for defence systems.

Aarti Industries fell 1.70% to ₹ 969.15. Consolidated net profit rose 4.6% to ₹ 139.84 crore in Q3 December 2019 (Q3 FY20) from a net profit of ₹ 133.70 crore in Q3 December 2018 (Q3 FY19). Net sales fell 4.5% year-on-year (Y-o-Y) to ₹ 1,218.48 crore in Q3 FY20. Profit before tax gained 4.3% to ₹ 178.83 crore Y-o-Y. Current tax expenses also soared 27.7% to ₹ 31.77 crore during the period under review.

Indian Railway Catering & Tourism Corporation (IRCTC) jumped 12.03% to ₹ 1589.70. On a standalone basis, IRCTC's net profit jumped 179.6% to ₹ 205.80 crore in Q3 December 2019 as against net profit of ₹ 73.60 crore in Q3 December 2018. Net sales rose 64.6% to ₹ 715.98 crore in Q3 December 2019 from ₹ 435.01 crore posted in Q3 December 2018.

Ashok Leyland gained 0.25% to ₹ 81.55. On a consolidated basis, the commercial vehicle maker's net profit tumbled 86.68% to ₹ 57.11 crore in Q3 December 2019 (Q3 FY20) as against ₹ 428.76 crore reported in Q3 December 2018 (Q3 FY19). Net sales slipped 30.48% year-on-year (Y-o-Y) to ₹ 5,148.15 crore in Q3 FY20. EBITDA margin stood at 5.6% in Q3 December 2019 compared with 5.8% in Q2 September 2019 and 10.3% in Q3 December 2018.

Natco Pharma slumped 5.62% to ₹ 668.75. The drug maker's consolidated net profit fell 34.5% to ₹ 104.50 crore on 13.4% decline in net sales to ₹ 482.20 crore in Q3 December 2019 over Q3 December 2018. Profit before tax in the December quarter stood at ₹ 128.80 crore, down by 37.1% from ₹ 204.70 crore reported in the corresponding quarter last fiscal. Current tax expenses of the company fell 39.6% to ₹ 31.10 crore in Q3 December 2019 over Q3 December 2018.

Torrent Power surged 8.06% to ₹ 328.40. The company reported 76.99% jump in consolidated net profit to ₹ 419.39 crore on 5.79% fall in total income to ₹ 3,115.48 crore in Q3 December 2019 over Q3 December 2018. Sales grew The board approved interim dividend of ₹ 11.60 per equity share, which includes a special dividend of ₹ 5.00 per equity share, with a view to distribute a part of the one-time tax gain arising from reduction in tax rates.

General Insurance Corporation of India slumped 4.05% to ₹ 228.55. GIC RE informed that that the Corporation has obtained license from the Central Bank of the Russian Federation (Bank of Russia) for its subsidiary company GIC Perestrakhovanie LLC, Moscow for commencement of reinsurance business. The license was received on 12 February 2020.

Global Markets:

European shares extended losses while Asian markets ended mostly lower on Thursday after China's Hubei province reported a spike in the number of new coronavirus cases due to a tweak in methodology.

The region reported an additional 242 deaths and 14,840 new cases for February 12, bringing the total number of people who have died amid the outbreak up to 1,310. The number of new cases rose dramatically after the province changed its method of reporting cases. The province said it is starting to include clinically diagnosed cases in its figures and that 13,332 of the new cases fall under that classification.

Back in Europe, British Prime Minister Boris Johnson is set to reshape his government on Thursday as the U.K. forges a future for itself outside of the European Union.

New data from the U.K.'s Royal Institution of Chartered Surveyors on Thursday showed that British house prices rose for the first time since July 2018 last month.

In US, markets ended higher on Wednesday, with all three major benchmarks registering all-time closing highs, buoyed by signs of a slowdown in the number of new cases of COVID-19 - a strain of coronavirus that emerged in Wuhan, China late last year.

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Key market barometers ended with small losses on Thursday. While private banks dragged the indices lower, gains in IT and pharma shares provided support. Trading was volatile due to expiry of weekly index options on the NSE. The sentiment was affected by weak domestic economic data. Shares across the globe were under pressure as the death toll from the coronavirus in mainland China spiked 23% Wednesday amid new counting methods adopted by Chinese health officials.

The barometer S&P BSE Sensex, was down 170.18 points or 0.41% at 41,395.72, as per the provisional closing data. The Nifty 50 index was down 26.55 points or 0.22% at 12,174.65, as the provisional closing data.

Selling was broad based. The S&P BSE Mid-Cap index was down 0.24% while the S&P BSE Small-Cap index lost 0.03%.

The market breadth was negative. On the BSE, 974 shares rose and 1386 shares fell. A total of 162 shares were unchanged. In Nifty 50 index, 21 stocks advanced while 29 stocks declined.

Economy:

The government announced IIP and retail inflation data after market hours yesterday, 12 February 2020. India's Industrial Production (IIP) shrank 0.3% to 133.5 in December 2019 over December 2018. Manufacturing sector output declined by 1.2%. Electricity generation also dipped 0.1%. Mining sector output grew by 5.4% compared with December 2018.

Consumer price inflation in January rose to 7.59%, holding around six-year top. CPI rural inflation rose to 7.73% versus 7.23% in December. January core inflation also surged to 4.8% versus 3.7% in December.

Buzzing Index:

The Nifty Private Bank index declined 1.39% to 17,078.90, underperforming the other sectoral indices on the NSE.

IndusInd Bank (down 3.97%), RBL Bank (down 2.14%), City Union Bank (down 2.11%), Kotak Mahindra Bank (down 1.45%), ICICI Bank (down 1.37%), Federal Bank (down 1.27%), Axis Bank (down 0.99%) and HDFC Bank (down 0.64%) declined.

Yes Bank surged 6.82%. The bank said it has received non-binding expressions of interest from investors including JC Flowers, Tilden Park Capital, OHA UK and Silver Point Capital. Meanwhile, India Ratings and Research has downgraded Yes Bank's long-term issuer rating to 'IND A-' from 'IND A', while maintaining it on rating watch negative (RWN). The downgrade reflects the continued delay and inconclusive quantum of the anticipated equity infusion in Yes Bank. Ind-Ra believes this could adversely impact the bank's franchise and potentially create challenges on asset and liability side.

Stocks in Spotlight:

Among Nifty stocks, BPCL (down 0.33%) and Nestle India (up 0.64%) will announce Q3 earnings today.

Infosys rose 1.60% to ₹ 793.55 while TCS added 0.56% to ₹ 2182.55.

Sterling and Wilson Solar slumped 7.63% to ₹ 277.05. The company reported 73.31% decline in consolidated net profit to ₹ 50.3 crore on a 34.52% fall in revenue from operations to ₹ 1076.4 crore in Q3 December 2019 over Q3 December 2018. Profit before tax or PBT stood at ₹ 62.1 crore in Q3 FY20, down by 72.92% from ₹ 229.4 crore in Q3 FY19.

Bharat Heavy Electricals (BHEL) advanced 1.93% to ₹ 37.05 after it signed a Memorandum of Understanding (MoU) with Joint Stock Company Rosoboronexporr, Russia to undertake joint projects and operations for defence systems.

Aarti Industries fell 1.70% to ₹ 969.15. Consolidated net profit rose 4.6% to ₹ 139.84 crore in Q3 December 2019 (Q3 FY20) from a net profit of ₹ 133.70 crore in Q3 December 2018 (Q3 FY19). Net sales fell 4.5% year-on-year (Y-o-Y) to ₹ 1,218.48 crore in Q3 FY20. Profit before tax gained 4.3% to ₹ 178.83 crore Y-o-Y. Current tax expenses also soared 27.7% to ₹ 31.77 crore during the period under review.

Indian Railway Catering & Tourism Corporation (IRCTC) jumped 12.03% to ₹ 1589.70. On a standalone basis, IRCTC's net profit jumped 179.6% to ₹ 205.80 crore in Q3 December 2019 as against net profit of ₹ 73.60 crore in Q3 December 2018. Net sales rose 64.6% to ₹ 715.98 crore in Q3 December 2019 from ₹ 435.01 crore posted in Q3 December 2018.

Ashok Leyland gained 0.25% to ₹ 81.55. On a consolidated basis, the commercial vehicle maker's net profit tumbled 86.68% to ₹ 57.11 crore in Q3 December 2019 (Q3 FY20) as against ₹ 428.76 crore reported in Q3 December 2018 (Q3 FY19). Net sales slipped 30.48% year-on-year (Y-o-Y) to ₹ 5,148.15 crore in Q3 FY20. EBITDA margin stood at 5.6% in Q3 December 2019 compared with 5.8% in Q2 September 2019 and 10.3% in Q3 December 2018.

Natco Pharma slumped 5.62% to ₹ 668.75. The drug maker's consolidated net profit fell 34.5% to ₹ 104.50 crore on 13.4% decline in net sales to ₹ 482.20 crore in Q3 December 2019 over Q3 December 2018. Profit before tax in the December quarter stood at ₹ 128.80 crore, down by 37.1% from ₹ 204.70 crore reported in the corresponding quarter last fiscal. Current tax expenses of the company fell 39.6% to ₹ 31.10 crore in Q3 December 2019 over Q3 December 2018.

Torrent Power surged 8.06% to ₹ 328.40. The company reported 76.99% jump in consolidated net profit to ₹ 419.39 crore on 5.79% fall in total income to ₹ 3,115.48 crore in Q3 December 2019 over Q3 December 2018. Sales grew The board approved interim dividend of ₹ 11.60 per equity share, which includes a special dividend of ₹ 5.00 per equity share, with a view to distribute a part of the one-time tax gain arising from reduction in tax rates.

General Insurance Corporation of India slumped 4.05% to ₹ 228.55. GIC RE informed that that the Corporation has obtained license from the Central Bank of the Russian Federation (Bank of Russia) for its subsidiary company GIC Perestrakhovanie LLC, Moscow for commencement of reinsurance business. The license was received on 12 February 2020.

Global Markets:

European shares extended losses while Asian markets ended mostly lower on Thursday after China's Hubei province reported a spike in the number of new coronavirus cases due to a tweak in methodology.

The region reported an additional 242 deaths and 14,840 new cases for February 12, bringing the total number of people who have died amid the outbreak up to 1,310. The number of new cases rose dramatically after the province changed its method of reporting cases. The province said it is starting to include clinically diagnosed cases in its figures and that 13,332 of the new cases fall under that classification.

Back in Europe, British Prime Minister Boris Johnson is set to reshape his government on Thursday as the U.K. forges a future for itself outside of the European Union.

New data from the U.K.'s Royal Institution of Chartered Surveyors on Thursday showed that British house prices rose for the first time since July 2018 last month.

In US, markets ended higher on Wednesday, with all three major benchmarks registering all-time closing highs, buoyed by signs of a slowdown in the number of new cases of COVID-19 - a strain of coronavirus that emerged in Wuhan, China late last year.

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