Jan 13, 2017 09:55 AM IST | Source:

Sensex, Nifty open higher; Infosys up 3% on Q3, TCS down 1%

Infosys is up 3 percent on its Q3 results. BHEL, ONGC, Coal India and L&T are gainers while ITC, TCS, Dr Reddy's Labs, Bahrti Airtel and Asian Paints are losers in the Sensex.

Moneycontrol Bureau

9:55 am Earnings review:
Girish Pai, Head of Research at Nirmal Bang Institutional Equities, said that the guidance revision is a definite positive in the short-term. However, he is more worried for medium and long-term growth on both structural and cyclical parameters.

Margins, too, will be a big worry, he said, adding that changes in the H1B visa hike could lead to 100-350 basis points margin cut for the IT companies.

Moshe Katri, MD of Wedbush Securities said that margins and performance in the financial services are the big positives from Infosys.

Infosys tightening its guidance for the ongoing fiscal was on expected lines. Moshe is neutral on the company.

9:45 am Macro data: India’s retail inflation rate grew 3.41 percent in December from November’s 3.63 percent, confirming fears of weak demand as households, hit by a demonetisation-induced cash crunch, put off spending. Low inflation levels can indicate poor demand and weak economic activity. The moderation is sharper on an annualised basis.

Factory output grew by a surprisingly robust 5.7 percent in November, running contrary to retail sales data showing slide in household spending and muted corporate investment hit by an economy-wide cash-crunch. Factory output measured by the index of industrial production (IIP) is the closest approximation for measuring economic activity in the country’s business landscape.

9:30 am Results: Tata Consultancy Services , the country's largest IT services provider said its third quarter (October-December) profit increased 2.9 percent sequentially to Rs 6,778 crore, driven by the strong digital business and great execution work. It touched USD 1 billion-mark in profit for the first time. Revenue during the quarter increased 1.5 percent to Rs 29,735 crore and dollar revenue growth was 0.3 percent at Rs 4,387 crore compared with previous quarter. Constant currency revenue growth for the quarter was at 2 percent with volume growth of 1 percent on sequential basis.

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The market has opened higher with a big push from Infosys. The Sensex is up 125.98 points or 0.5 percent at 27373.14, and the Nifty up 31.10 points or 0.4 percent at 8438.30. About 546 shares have advanced, 185 shares declined, and 219 shares are unchanged.

Infosys is up 3 percent on its Q3 results.Infosys has reported a 2.8 percent sequential growth in third quarter profit at Rs 3,708 crore and a 0.2 percent degrowth in revenue at Rs 17,273 crore. Dollar revenue declined 1.4 percent to USD 2,531 crore compared with previous quarter.

Infosys revised its full year revenue guidance to 8.4-8.8 percent from 8-9 percent in constant currency.

BHEL, ONGC, Coal India and L&T are gainers while ITC, TCS, Dr Reddy's Labs, Bahrti Airtel and Asian Paints are losers in the Sensex.

The Indian rupee opened lower by 7 paise at 68.16 per dollar on Friday against previous close 68.09.

Bhaskar Panda of HDFC Bank said, "This week saw the dollar Index come down to trade below 101 levels. Given the dollar weakness, we expect the USD-INR pair to trade in a range of 67.90-68.15/dollar today."

The dollar index recouped some of its losses but still trades lower as Trump trade loses steam. The yen traded at 114.8 per dollar, on course for a 2 percent gain this week.

Asian shares dipped but remained on track for weekly gains while the dollar was poised for a losing week, as investors weighed whether President-elect Donald Trump would stress growth-boosting steps when he takes office.

On Wall Street, major indexes finished lower a day after Trump failed to elaborate on his economic stimulus plans in his first news conference since his Nov. 8 election victory.

MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.2 percent, after rising to its highest levels since late October in the previous session. It was up 1.8 percent for the week.

Japan's Nikkei stock index rose 0.4 percent, on track to shed 1.2 percent for the week.

Many investors remained hopeful that markets will get a lift from a wave of financial deregulation that could follow Trump's inauguration, including a rollback of some of the Dodd-Frank financial reform that Congress enacted after the financial crisis and bank bailouts.

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