Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities:
Against the backdrop of positive sentiment in the global market, the Indian market saw an improvement. The Nifty Index, led by HDFC Bank, rose 0.75 percent, while the Bank Nifty rose 1.99 percent. Cement, metals and pharmaceutical stocks performed well in the broader market. We witnessed the volume-based activity in reality and housing finance companies.
Technically, it is clear that the market has taken a break after a sharp decline on Thursday. If the market breaks 11660 levels on Monday then today's formation could turn into a bearish continuation formation and then the Nifty would fall to 11550 or 11500 levels. On the upside, 11850 and 11900 would be the main obstacles. The Bank Nifty has established a bullish harami pattern and in next few days it looks like the broader market would move towards the trend of financial stocks.
Ajit Mishra, VP - Research, Religare Broking:
Markets took a breather after yesterday’s fall and managed to close half a percent higher. Despite mixed global cues, the benchmark witnessed a positive start, followed by the range-bound move till the end. Amid all, movement on the stock-specific front kept the participants busy wherein the metal and select banking stocks witnessed a strong rebound. The Nifty index finally settled near day’s high at 11,763 levels, up by 0.7%. The broader market indices too showed some resilience and posted decent gains.
Indications are in the favour of consolidation in Nifty thus we suggest continuing with the stock-specific trading approach and maintaining positions on both sides. However, it’s easier said than done due to prevailing choppiness. Meanwhile, global cues will be on the radar as US elections are just around the corner as well as the second wave of Covid-19 infection has led to more lockdown and restriction. Any further rise in restrictions could severely impact investors’ sentiments.
Vinod Nair, Head of Research at Geojit Financial Services:
The market has lifted marginally after yesterday’s deep fall, but the overall trend is still fragile. The market trend has turned weak due to high stock prices in spite of lack of required fiscal support and rising spread of covid impacting economic recovery. The quick bounce of the market to above last high and near the pre-covid level, has brought volatility, which can stay for some time.
For Nifty 50 a strong support is at 11,500 limiting the downside, in the near-term. The market will look forward, with high hopes on Q2 results and update on stimulus plans. IT, Telecom, Pharma and Banks will be the sectors under focus with a positive bias.
S Ranganathan, Head of Research at LKP Securities:
At 40k Sensex today the market mood was far from cheerful despite Metals & Pharma stocks posting gains. Selective buying in Midcaps by savvy investors not withstanding the general mood in the broader markets was that of caution as profit booking was seen across several sectors.
Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments:
We did not have much happening in the markets today. The support of 11550-11600 is still intact and therefore we continue to be in a bullish environment. Next week could prove crucial as we need to see if the Nifty is able to get past the 11950-12000 level or the bears take over and break the levels of 11500.
Sanjeev Zarbade, VP PCG Research, Kotak Securities:
The BSE-30 Index declined 1.3% in the current week. The market witnessed a slight correction as sentiments turned cautious on rising number of Covid-19 cases globally, despite domestic cases coming under control, and fading hopes of US fiscal stimulus.
Axis Bank, Infosys and HCL Technologies gained the most while Sun Pharmaceuticals, Bharti Airtel and Tech Mahindra lost the most in the BSE-30 Index in the past week. Infosys and TCS came out with good set of numbers while that of Mindtree disappointed the investors.
FPIs bought equities worth USD649 mn over the past five trading sessions while DIIs sold USD 523 mn worth of equities in the same period. Going into the next few weeks, the key events are the US elections, progress on the US fiscal stimulus and earnings announcements from Indian corporates. Valuations are not attractive. Hence, investors should trade with a cautious bias as after the swift rise in markets, there could be sharp corrections. Risk could be resurgence of Covid-19 in India.
Market Close:
After breaking 10-day winning streak in the previous session, the benchmark indices bounced back on October 16 supported by the bank, metal and pharma names.
At close, the Sensex was up 254.57 points or 0.64% at 39982.98, and the Nifty was up 82.10 points or 0.70% at 11762.50. About 1459 shares have advanced, 1135 shares declined, and 171 shares are unchanged.
JSW Steel, Tata Steel, BPCL, Divis Labs and Hindalco Industries were among major gainers on the Nifty, while losers were UPL, HCL Tech, M&M, Asian Paints and Reliance Industries.
Except IT other sectoral indices ended higher led by the metal, bank and pharma. BSE Midcap and Smallcap indices rose 1 percent each.
CRISIL revises (upgraded) rating of Chemcon Speciality Chemicals:
Abhishek Bansal, Founder Chairman, Abans Group:
A rally in the Dollar Index to a 1-week high on Thursday, was bearish for silver prices, along with reduced hopes for a pre-election U.S. pandemic stimulus bill. Silver prices also fell, on the back of concerns that industrial metals demand in Europe will take a hit, after some cities imposed fresh lockdown measures, to curtail the spread of Covid infections.
Silver prices are likely to find support near the 100-days EMA at USD 23.68, and the 200-days EMA at USD 21.73, while critical resistance is seen near USD 25.98-26.83 levels.
Liberty Steel makes non-binding offer for Thyssenkrupp:
Privately-held Liberty Steel has made a non-binding offer for the steel unit of German conglomerate Thyssenkrupp TKAG.DE, the group said on Friday, reported Reuters.
“Liberty Steel is convinced that a combination with Thyssenkrupp Steel Europe can be the right answer from an economic, social, and environmental perspective,” the group said in a statement.
Goa Carbon production data:
Company's September production fell 40.5% MoM at 6,246 million tons versus 10,508 million tons (MoM).
BSE Realty Index rose over 1 percent led by the Sunteck Realty, Prestige Estate, DLF:
KRChoksey on HCL Technologies:
HCL Technologies’ 2QFY21 earnings report reflects healthy broad-based revenue traction, which was the key positive takeaway, along with EBIT margin expansion, which came in at its highest level since FY15. We are enthused with the revenue recovery seen after a challenging 1QFY21, and believe company is well-positioned to ride this medium-term upswing in IT spend with its broad portfolio of services, including well established cloud position, ER&D services and P&P differentiator. We have an accumulate rating on company with a target price of Rs 893.
Rupee ends higher
Indian rupee erased early losses and ended higher at 73.34 per dollar, amid buying seen in the domestic equity market.
It opened marginally lower at 73.43 per dollar against previous close of 73.38 and remained in the range of 73.27-73.43.
Buzzing Stock
Shakti Pumps share price jumped over 6 percent after the company declared its September quarter results. The company's consolidated net profit came in at Rs 22.5 crore against loss of Rs 4.3 crore (YoY). Consolidated revenue came in at Rs 201.1 crore against Rs 91.2 crore (YoY).
Philips Carbon Q2:
Net profit went down 25 percent at Rs 58 crore against Rs 77.4 crore (YoY). Revenue went down 23 percent at Rs 664 crore against Rs 863 crore (YoY). EBITDA was down 18 percent at Rs 105.3 crore against Rs 128.4 crore (YoY). EBITDA margin stood at 15.9 percent against 14.9 percent (YoY).
Most active stocks on NSE in terms of volumes
Federal Bank Q2
: Net profit went down 26.2 percent at Rs 307.6 crore against Rs 416.7 crore (YoY). NII grew 22.8 percent at Rs 1,379.9 crore against Rs 1,123.8 crore (YoY). Gross NPA at 2.84 percent against 2.96 percent (QoQ). Net NPA at 0.99 percent against 1.22 percent (QoQ). Gross NPA at Rs 3.552.2 crore against Rs 3,655.6 crore (QoQ). Net NPA at Rs 1,218.1 crore against Rs 1,477.5 crore (QoQ).
Market Updates
Benchmark indices are trading higher in the afternoon trade with Sensex around 40000 level.
At 13:12 IST, the Sensex was up 268.08 points or 0.67% at 39996.49, and the Nifty was up 76.20 points or 0.65% at 11756.60. About 1214 shares have advanced, 1085 shares declined, and 136 shares are unchanged.
ICICIdirect on Cyient:
Cyient reported a decent set of Q2FY21 numbers. Dollar revenues increased 3.4% QoQ (1.3% in constant currency terms) led by 1.7% QoQ growth in services revenues and 13.3% QoQ growth in DLM revenues.
Going forward, the company expects communication, transportation and medical segment to drive revenue growth and believes aerospace revenues bottomed out in Q2FY21. Hence, we expect revenues to improve on a QoQ basis, going forward.
In terms of margins, we expect the company to post a healthy improvement in FY22E and FY23E led by various cost rationalisation measures undertaken by the company. Hence, we upgrade the stock from hold to buy with a revised target price of Rs 440 (10x FY23E EPS).
European Markets trade higher:
Yash Gupta - Equity Research Associate, Angel Broking:
Astrazeneca Pharma India has received permission for import and market for cancer drug i.e Acalabrutinib 100mg capsules (Calquence) from the Drugs Controller General of India in Form CT-20 (Marketing Authorization- Additional Indication). AstraZeneca Pharma India Limited will launch Calquence in India on October 21, 2020.
Acalabrutinib 100mg capsules Indicated for the treatment of patients with mantle cell lymphoma (MCL) who have received at least one prior therapy or indicated for treatment of patients with chronic lymphocytic leukaemia (CLL)/ small lymphocytic lymphoma (SLL). This is positive development for Astrazeneca Pharma India.
Indiabulls Housing sells stake in OakNorth Holdings
Indiabulls Housing Finance has further sold a portion of its stake in OakNorth Holdings Ltd. (the wholly owning parent company of OakNorth Bank plc) for approximately Rs 220 crore. The sale proceeds will be accretive to the regulatory net worth and the CRAR of the company.
With the latest stake sale, the company has raised a total of Rs 2,493 crore as fresh equity in the month of September and October 2020 (Rs 683 crore through QIP and Rs 1,810 crore through sale of stake in OakNorth) adding to the regulatory equity capital of the company.
Oil slides
Oil prices slid on Friday dragged down by concerns that a spike in COVID-19 cases in Europe and the United States is curtailing demand in two of the world's biggest fuel consuming regions, while a stronger U.S. dollar also added to pressure.
Nifty Pharma Index rose 1 percent supported by the Biocon, Divis Lab, Cadila Healthcare:
Alembic Pharma gets USFDA nod
Alembic Pharmaceuticals has received approval from the US Food & Drug Administration (USFDA) for its Abbreviated New Drug Application (ANDA) Amantadine Hydrochloride Tablets, 100 mg.
RBI to conduct OMOs on Oct 22
Reserve Bank of India (RBI) is going to conduct open market operations (OMOs) for Rs 10,000 crore on October 22. The OMO size may be enhanced in subsequent auctions, depending on the market response, reported CNBC-Tv18.
Asian Markets update
Asian stocks gave up early gains and fell on Friday, as a resurgence of coronavirus infections in Europe and the United States hurt risk appetite.
MSCI's broadest index of Asia-Pacific shares outside Japan dipped 0.22%. U.S. stock futures also eased 0.12%. Shares in China initially rose as investors snapped up banking shares due to an improving earnings outlook, but the broader market surrendered those gains and fell 0.55%, reported Reuters.
Rupee Updates
Indian rupee erased early losses and trading higher at 73.32 per dollar, amid buying seen in the domestic equity market.It opened marginally lower at 73.43 per dollar against previous close of 73.38.
Nifty Bank Index added 1 percent supported by Bandhan Bank, IndusInd Bank, HDFC Bank:
Jyoti Roy- DVP- Equity Strategist, Angel Broking:
HCL Technologies reported a 6.4 percent QoQ growth in revenues to USD 2,507 million in Q2FY2021 which was in line with our expectations. In rupee terms consolidated revenue increased by 4.2 percent QoQ to Rs 18,594 crore while gross profits increased by 7.8 percent QoQ to Rs 7,665 crore. Gross margins expanded by ~130bps QoQ to 41.2 percent. Net profit for the quarter was up by 7.5 percent QoQ to Rs 3,142 crore.
Management has maintained their guidance of a 1.5-2.5 percent growth in revenue in constant currency terms for the rest of the quarters in the financial year. While Q2FY21 revenue was in line with our expectations gross margins came in ahead of expectations despite currency headwinds EBIDTA and net profits for the quarter too were in line with our expectations. We continue to remain positive on HCL Technologies post the Q2 numbers.
Buzzing Stock
Vimta Labs share price gained 5 percent intraday on October 16 after standalone net profit surged 720 percent in the September quarter to Rs 7.38 crore in the quarter ended September 2020 as against Rs 0.90 crore during the previous quarter ended September 2019.
ICICIdirect:
As there was a risk of sentiment trades, which pushed the dollar index sharply higher, profit booking was seen in the rupee due to which it depreciated. However, we feel the rupee has moved near its supply zone and the spread between spot and future has risen. The rupee could appreciate again and move towards 73.25 levels.
The dollar-rupee October contract on the NSE closed near 73.51 in the last session. The open interest fell 1.33% in the last session.
Zydus Cadila gets final USFDA approval
Zydus Cadila has received final approval from the USFDA to market Fingolimod Capsules, 0.5 mg (US RLD: Gilenya Capsules).
Fingolimod is an immunomodulating drug. It is a sphingosine 1-phosphate receptor modulator indicated for the treatment of relapsing forms of multiple sclerosis (MS). The drug will be manufactured at the group’s formulation manufacturing facility at the SEZ, Ahmedabad.
Nifty IT index shed nearly 1 percent dragged by the Mindtree, Mphasis, HCL Tech:
Rupee Opens
Indian rupee opened marginally lower at 73.43 per dollar on against previous close of 73.38, amid buying seen in the domestic equity market.
Market Updates
Benchmark indices erases early gains and trading flat.
At 10:01 IST, the Sensex was down 6.51 points or 0.02% at 39721.90, and the Nifty was down 5.60 points or 0.05% at 11674.80. About 875 shares have advanced, 914 shares declined, and 123 shares are unchanged.
South Indian Bank Q2
Company's net profit was down 23% YoY at Rs 65.1 crore versus Rs 84.5 crore and NII was up 13.6% at Rs 663.1 crore versus Rs 584.3 crore, reported CNBC-TV18.
ICICIdirect on Mindtree:
Broking house believes the company’s expertise in digital technology will make it a key beneficiary of improved traction in the cloud in the coming years. In addition, vendor consolidation opportunities, improving win ratio, increase in annuity business will provide long term visibility to revenues.
MindTree’s aim to improve margins via employee pyramid, offshoring, pricing, utilisation and annuity business bodes well for profit growth. Maintains buy with target at Rs 1,680.
Mindtree slips 3% post result
Mindtree share price shed 3 percent on October 16 a day after the company reported 19 percent QoQ jump in its consolidated net profit at Rs 253.7 crore against Rs 213 crore in the quarter ended June 2020.
Rupee revenue of the company stood at Rs 1,926 crore against Rs 1,909 crore and consolidated dollar revenue was up 3.1 percent at $261 million against $253.2 million.
Buzzing Stock
Cyient share price gained over 3 percent after the company declared its September quarter results. Its consolidated net profit was up 3.1 percent QoQ at Rs 83.9 crore versus Rs 81.4 crore and revenue was up 1.2 percent at Rs 1,003.3 crore versus Rs 991.7 crore.
Buzzing Stock
HCL Technologies share price declined 2 percent after company posted its September quarter results. It has reported September quarter net profit at Rs 3,142 crore. According to CNBC-TV18 poll the profit was expected at Rs 3,046 crore. The company had reported net profit at Rs 2,925 crore in the quarter ended June 2020.
Market opens
: Sensex is up 311.22 points or 0.78 percent at 40039.63, and the Nifty jumped 75 points or 0.64 percent at 11755.40. Infosys, IndusInd Bank and HDFC Bank are the top gainers while HCL Tech, Infosys and Mindtree are the most active stocks.
Among the sectors, the IT index added over a percent while the midcap and smallcap indices are up half a percent each.
HCL Tech Q2:
HCL Technologies reported its September quarter net profit at Rs 3,142 croreagainst CNBC-TV18 poll of Rs 3,046 crore. Rupee revenue was at Rs 18,594 crore against CNBC-TV18 poll of Rs 18,536 crore. Earnings before interest and tax (EBIT) margin was at 21.6 percent, which is at 5-year high. In the Q3 and Q4 revenue guidance the constant currency revenue growth seen at 1.5-2.5 percent, reported CNBC-TV18.
Market at pre-open
: Benchmark indices are trading positive in the pre-opening session.
At 09:02 IST, the Sensex was up 167.46 points or 0.42% at 39895.87, and the Nifty was up 27.50 points or 0.24% at 11707.90.
RIL receives subscription amounts:
Reliance Retail Ventures Limited, a subsidiary of Reliance Industries received subscription amounts of Rs 6247.50 from MIC Redwood 1 RSC Limited (Mubadala) and Rs 5512.50 crore from Platinum Owl C 2018 RSC Limited (acting in its capacity as trustee of ‘Platinum Jasmine A 2018 Trust’) (ADIA)
