Nifty hits lowest closing level in more than 3 weeks
Key benchmark indices registered small losses after witnessing volatility towards late trade. The barometer index, the S&P BSE Sensex, lost 53.66 points or 0.19% to settle at 27,782.25. The Nifty 50 index lost 19.65 points or 0.23% to settle at 8,572.55. Key benchmark indices extended losses in mid-afternoon trade after witnessing a range bound movement until then. Benchmark indices trimmed losses in late trade. The Sensex hit its lowest closing level in more than two weeks. The Nifty hit its lowest closing level in more than three weeks.
Caution prevailed on the bourses ahead of a speech by Federal Reserve Chairwoman Janet Yellen later in the global day at the Kansas City Fed's annual Monetary Policy Symposium in Jackson Hole, Wyoming, which could provide hints about the timing of the next rate hike from the Fed. High US interest rates would pull money out of emerging markets and redirect it to the US. Minutes from the Federal Open Market Committee's (FOMC) July meeting showed officials were split on whether an increase in interest rate was needed soon.
Stocks of public sector banks edged lower. Stocks of private sector banks were mixed. Capital goods stocks edged lower. Index heavyweight Reliance Industries nudged higher. Tata Motors shrugged off weak Q1 results. Biocon gained after European Medicines Agency accepted for review Biocon's partner Mylan's marketing authorization application for a proposed biosimilar Trastuzumab.
The Sensex lost 53.66 points or 0.19% to settle at 27,782.25, its lowest closing level since 10 August 2016. The index rose 99.97 points or 0.35% at the day's high of 27,935.88. The index fell 138.92 points or 0.49% at the day's low of 27,696.99.
The Nifty lost 19.65 points or 0.23% to settle at 8,572.55, its lowest closing level since 4 August 2016. The index rose 30.75 points or 0.35% at the day's high of 8,622.95. The index fell 44.65 points or 0.51% at the day's low of 8,547.55.
The BSE Mid-Cap index rose 0.17%, outperforming the Sensex. The BSE Small-Cap index lost 0.12%. The decline in this index was lower than the Sensex's decline in percentage terms.
The market breadth indicating the overall health of the market was negative. On BSE, 1,547 shares declined and 1,094 shares rose. A total of 209 shares were unchanged.
The total turnover on BSE amounted to Rs 2784 crore, lower than turnover of Rs 2922.56 crore registered during the previous trading session.
Among the sectoral indices on BSE, the S&P BSE IT index (down 1.25%), the BSE Capital Goods index (down 1.24%) and the BSE Realty index (down 1.15%) underperformed the Sensex. The BSE Auto index (up 0.62%), the BSE Consumer Durables index (up 1.46%) and the BSE Oil & Gas index (up 0.7%) outperformed the Sensex.
Stocks of public sector banks edged lower. IDBI Bank (down 3.95%), Bank of India (down 2.47%), Punjab National Bank (down 2.43%), Bank of Baroda (down 2.07%), Canara Bank (down 0.67%), Indian Bank (down 0.63%) and Union Bank of India (down 0.22%) declined. Corporation Bank (up 0.48%) and Indian Overseas Bank (up 0.19%) edged higher.
Stocks of private sector banks were mixed. IndusInd Bank (down 1.56%) and Yes Bank (down 1.29%) edged lower. Kotak Mahindra Bank (up 0.28%), and Axis Bank (up 0.07%) edged higher.
Index heavyweight HDFC Bank was up 0.02% at Rs 1,257.90. The stock hit a high of Rs 1,261.75 and a low of Rs 1,253 in intraday trade.
The Reserve Bank of India (RBI) said in a draft paper on banks' large exposure (LE) limit that large exposure limit in respect of each counterparty and group of connected counterparties will be capped at 20% and 25% respectively of the bank's eligible capital base under normal circumstances. The eligible capital base will be defined as the Tier 1 capital of the bank as against capital funds at present. A group of connected counterparties will be identified on the basis of 'control' as well as 'economic dependence' criteria. The RBI has sought public comments on the draft LE framework by 15 September 2016.
Separately, RBI has allowed banks to issue rupee bonds overseas (Masala Bonds) for their capital requirements and for financing infrastructure and affordable housing. This was a part of the measures announced by RBI for the development of fixed income and currency markets.
State Bank of India (SBI) was down 1.34% at Rs 246.70. ICICI Bank was down 0.77% at Rs 245.25. The RBI continued to classify these two banks as domestic systemically important banks (D-SIBs). The additional Common Equity Tier 1 (CET1) requirement for D-SIBs has already been phased-in from 1 April 2016 and would become fully effective from 1 April 2019. The additional CET1 requirement will be in addition to the capital conservation buffer. On account of being classified as D-SIB, there is additional CET1 requirement of 0.6% of Risk Weighted Assets (RWAs) for SBI and 0.2% of RWAs for ICICI Bank.
Capital goods stocks edged lower. Crompton Greaves (down 1.49%), ABB India (down 1.45%), GE T&D India (down 1.01%), Bharat Heavy Electricals (down 0.96%), Suzlon Energy (down 0.92%) and Thermax (down 0.86%) declined. BEML (up 2.08%), Siemens (up 1.76%) and Bharat Electronics (up 0.46%) edged higher.
L&T was down 2.02% at Rs 1,427.85. The company's Chairman A. M. Naik said at the company's Annual General Meeting in Mumbai today, 26 August 2016, that the company's goal is to achieve revenue of Rs 2 lakh crore ($30 billion) by 2021 without compromising on profit margins. He said that economic conditions are starting to turn in favour of the company. Naik said that the opening of the defence sector will lead to business opportunities worth Rs 13 lakh crore over the next 10 years. He also said that there is estimated business opportunity of Rs 50000 crore over 10 years in nuclear power sector. Naik also said that L&T will tap business opportunity in government's Smart City projects and realty segment. Naik said that there are a number of projects in the road, ports, airports, railway sectors in pipeline with a total estimated value of over Rs 14 lakh crore. Naik said that L&T is also strengthening its operations in the Gulf, Africa and South East Asia.
IT stocks declined. Wipro (down 3%) and Oracle Financial Services Software (down 0.81%) edged lower. Tech Mahindra (up 0.31%) edged higher.
HCL Technologies was down 2.49% at Rs 778.80. The company at the fag end of market hours today, 26 August 2016, announced the withdrawal of a scheme for the transfer of India System Integration Business as a going concern to HCL Comnet Limited, a wholly owned subsidiary. The company has now said that its board of directors approved the management's proposal to confine the India business to certain defined areas and in view of this, the board has also approved to withdraw the scheme, subject to the approval of the High Court.
Index heavyweight and software major Infosys was down 1.52% at Rs 1,020.75. The stock hit a high of Rs 1,046 and a low of Rs 1,017.10 in intraday trade. Infosys Chief Financial Officer Ranganath D Mavinakere reportedly said at an analyst meet today, 26 August 2016, that there is some 'softness' in clients after Britain voted in June to leave the European. Infosys will be in a better position by October to evaluate the impact of this on its earnings outlook for the current financial year, Mavinakere said, according to reports. Mavinakere reportedly said that growth in the second quarter would be better than the previous three months.
TCS lost 0.82%. The company announced new software that enables retailers to leverage insightful data to deepen relationships with customers. The new software enables retailers to leverage insightful data either from in-store sensors or other Internet of Things (IoT) devices to deepen relationships with customers through more personalized customer engagement strategies. The announcement was made after market hours yesterday, 25 August 2016.
Index heavyweight Reliance Industries was up 1.44% at Rs 1,027.70. The stock hit a high of Rs 1,030 and a low of Rs 1,014.65 in intraday trade.
Tata Motors shrugged off weak Q1 results. The stock was up 2.01% at Rs 503.65. The stock was volatile. The stock hit a high of Rs 515 and a low of Rs 486.10 in intraday trade. The company's consolidated net profit declined 57.25% to Rs 2236 crore on 9.01% growth in revenue to Rs 67056 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours today, 26 August 2016.
The profit before tax fell 67.41% to Rs 2066 crore in Q1 June 2016 over Q1 June 2015. Higher volumes in both standalone as well as Jaguar Land Rover (JLR) business was more than offset by the adverse foreign currency impact of Rs 2296 crore and adverse commodity derivatives impact of Rs 167 crore in the operating profit mainly in the Jaguar Land Rover business. The profitability was also adversely impacted by lower local market incentive in the JLR business as compared to the corresponding quarter last year and higher depreciation and amortization expenses as compared to the corresponding quarter last year.
There was an exceptional income of Rs 478.32 crore in Q1 June 2016 pertaining to further recoveries on account of the Tianjin incident which happened during the previous financial year (FY 2016). Tata Motors attributed the increase in top line during the quarter to strong sales from Jaguar Land Rover (JLR) business and continued volume growth in M&HCV segment and the LCV segment.
Tata Motors board approved raising funds aggregating Rs 3000 crore by way of issue of secured/unsecured debentures and/or bonds in one or more tranches, from time to time.
Biocon gained after European Medicines Agency accepted for review Biocon's partner Mylan's marketing authorization application for a proposed biosimilar Trastuzumab. The stock rose 3.1% at Rs 892.45. The announcement was made after market hours yesterday, 25 August 2016. Mylan N.V., a global pharmaceutical company and Biocon announced that the European Medicines Agency (EMA) has accepted for review Mylan's marketing authorization application (MAA) for a proposed biosimilar Trastuzumab, which is used to treat certain HER2-positive breast and gastric cancers. Mylan and Biocon, which have co-developed this proposed biosimilar, anticipate that this may be the first MAA for a Trastuzumab biosimilar accepted by the EMA for review. This filing includes analytical, functional and pre-clinical data, as well as results from the pharmacokinetics (PK) and confirmatory efficacy/safety global clinical trials for Trastuzumab.
This is the second biosimilar submission developed by the partnership that has been accepted for review in Europe. Last month, Mylan's MAA for the proposed biosimilar Pegfilgrastim was accepted for review by EMA.
Biocon and Mylan are exclusive partners on a broad portfolio of biosimilars and insulin analogs. The proposed biosimilar Trastuzumab is one of the six biologic products co-developed by Mylan and Biocon for the global marketplace. Mylan has exclusive commercialization rights for the proposed biosimilar Trastuzumab in the US, Canada, Japan, Australia, New Zealand, the European Union and European Free Trade Association countries. Biocon has co-exclusive commercialization rights with Mylan for the product in the rest of the world.
Meanwhile, RBI after trading hours yesterday, 25 August 2016, announced a package of measures for the development of fixed income and currency markets. The central said it has been decided to enhance the aggregate limit of partial credit enhancement (PCE) provided by banks, permit brokers in corporate bond repos, authorise the platform for repo in corporate bonds and encourage credit supply for large borrowers through market mechanism. The RBI has allowed banks to issue issue rupee bonds overseas (Masala Bonds) for their capital requirements and for financing infrastructure and affordable housing.
Foreign Portfolio Investors (FPIs) will be given direct access to NDS-OM to ease the process of investment in debt securities. The RBI said it has also been decided to provide FPIs facility to trade directly in corporate bonds.
Meanwhile, the India Meteorological Department (IMD) in its monsoon update issued yesterday, 25 August 2016, said that for the country as a whole, cumulative rainfall during this year's monsoon so far (till 25 August 2016) was 3% below the long period average (LPA).
Caution prevailed on the bourses ahead of a speech by Federal Reserve Chairwoman Janet Yellen later in the global day at the Kansas City Fed's annual Monetary Policy Symposium in Jackson Hole, Wyoming, which could provide hints about the timing of the next rate hike from the Fed. High US interest rates would pull money out of emerging markets and redirect it to the US. Minutes from the Federal Open Market Committee's (FOMC) July meeting showed officials were split on whether an increase in interest rate was needed soon.
Stocks of public sector banks edged lower. Stocks of private sector banks were mixed. Capital goods stocks edged lower. Index heavyweight Reliance Industries nudged higher. Tata Motors shrugged off weak Q1 results. Biocon gained after European Medicines Agency accepted for review Biocon's partner Mylan's marketing authorization application for a proposed biosimilar Trastuzumab.
The Sensex lost 53.66 points or 0.19% to settle at 27,782.25, its lowest closing level since 10 August 2016. The index rose 99.97 points or 0.35% at the day's high of 27,935.88. The index fell 138.92 points or 0.49% at the day's low of 27,696.99.
The Nifty lost 19.65 points or 0.23% to settle at 8,572.55, its lowest closing level since 4 August 2016. The index rose 30.75 points or 0.35% at the day's high of 8,622.95. The index fell 44.65 points or 0.51% at the day's low of 8,547.55.
The BSE Mid-Cap index rose 0.17%, outperforming the Sensex. The BSE Small-Cap index lost 0.12%. The decline in this index was lower than the Sensex's decline in percentage terms.
The market breadth indicating the overall health of the market was negative. On BSE, 1,547 shares declined and 1,094 shares rose. A total of 209 shares were unchanged.
The total turnover on BSE amounted to Rs 2784 crore, lower than turnover of Rs 2922.56 crore registered during the previous trading session.
Among the sectoral indices on BSE, the S&P BSE IT index (down 1.25%), the BSE Capital Goods index (down 1.24%) and the BSE Realty index (down 1.15%) underperformed the Sensex. The BSE Auto index (up 0.62%), the BSE Consumer Durables index (up 1.46%) and the BSE Oil & Gas index (up 0.7%) outperformed the Sensex.
Stocks of public sector banks edged lower. IDBI Bank (down 3.95%), Bank of India (down 2.47%), Punjab National Bank (down 2.43%), Bank of Baroda (down 2.07%), Canara Bank (down 0.67%), Indian Bank (down 0.63%) and Union Bank of India (down 0.22%) declined. Corporation Bank (up 0.48%) and Indian Overseas Bank (up 0.19%) edged higher.
Stocks of private sector banks were mixed. IndusInd Bank (down 1.56%) and Yes Bank (down 1.29%) edged lower. Kotak Mahindra Bank (up 0.28%), and Axis Bank (up 0.07%) edged higher.
Index heavyweight HDFC Bank was up 0.02% at Rs 1,257.90. The stock hit a high of Rs 1,261.75 and a low of Rs 1,253 in intraday trade.
The Reserve Bank of India (RBI) said in a draft paper on banks' large exposure (LE) limit that large exposure limit in respect of each counterparty and group of connected counterparties will be capped at 20% and 25% respectively of the bank's eligible capital base under normal circumstances. The eligible capital base will be defined as the Tier 1 capital of the bank as against capital funds at present. A group of connected counterparties will be identified on the basis of 'control' as well as 'economic dependence' criteria. The RBI has sought public comments on the draft LE framework by 15 September 2016.
Separately, RBI has allowed banks to issue rupee bonds overseas (Masala Bonds) for their capital requirements and for financing infrastructure and affordable housing. This was a part of the measures announced by RBI for the development of fixed income and currency markets.
State Bank of India (SBI) was down 1.34% at Rs 246.70. ICICI Bank was down 0.77% at Rs 245.25. The RBI continued to classify these two banks as domestic systemically important banks (D-SIBs). The additional Common Equity Tier 1 (CET1) requirement for D-SIBs has already been phased-in from 1 April 2016 and would become fully effective from 1 April 2019. The additional CET1 requirement will be in addition to the capital conservation buffer. On account of being classified as D-SIB, there is additional CET1 requirement of 0.6% of Risk Weighted Assets (RWAs) for SBI and 0.2% of RWAs for ICICI Bank.
Capital goods stocks edged lower. Crompton Greaves (down 1.49%), ABB India (down 1.45%), GE T&D India (down 1.01%), Bharat Heavy Electricals (down 0.96%), Suzlon Energy (down 0.92%) and Thermax (down 0.86%) declined. BEML (up 2.08%), Siemens (up 1.76%) and Bharat Electronics (up 0.46%) edged higher.
L&T was down 2.02% at Rs 1,427.85. The company's Chairman A. M. Naik said at the company's Annual General Meeting in Mumbai today, 26 August 2016, that the company's goal is to achieve revenue of Rs 2 lakh crore ($30 billion) by 2021 without compromising on profit margins. He said that economic conditions are starting to turn in favour of the company. Naik said that the opening of the defence sector will lead to business opportunities worth Rs 13 lakh crore over the next 10 years. He also said that there is estimated business opportunity of Rs 50000 crore over 10 years in nuclear power sector. Naik also said that L&T will tap business opportunity in government's Smart City projects and realty segment. Naik said that there are a number of projects in the road, ports, airports, railway sectors in pipeline with a total estimated value of over Rs 14 lakh crore. Naik said that L&T is also strengthening its operations in the Gulf, Africa and South East Asia.
IT stocks declined. Wipro (down 3%) and Oracle Financial Services Software (down 0.81%) edged lower. Tech Mahindra (up 0.31%) edged higher.
HCL Technologies was down 2.49% at Rs 778.80. The company at the fag end of market hours today, 26 August 2016, announced the withdrawal of a scheme for the transfer of India System Integration Business as a going concern to HCL Comnet Limited, a wholly owned subsidiary. The company has now said that its board of directors approved the management's proposal to confine the India business to certain defined areas and in view of this, the board has also approved to withdraw the scheme, subject to the approval of the High Court.
Index heavyweight and software major Infosys was down 1.52% at Rs 1,020.75. The stock hit a high of Rs 1,046 and a low of Rs 1,017.10 in intraday trade. Infosys Chief Financial Officer Ranganath D Mavinakere reportedly said at an analyst meet today, 26 August 2016, that there is some 'softness' in clients after Britain voted in June to leave the European. Infosys will be in a better position by October to evaluate the impact of this on its earnings outlook for the current financial year, Mavinakere said, according to reports. Mavinakere reportedly said that growth in the second quarter would be better than the previous three months.
TCS lost 0.82%. The company announced new software that enables retailers to leverage insightful data to deepen relationships with customers. The new software enables retailers to leverage insightful data either from in-store sensors or other Internet of Things (IoT) devices to deepen relationships with customers through more personalized customer engagement strategies. The announcement was made after market hours yesterday, 25 August 2016.
Index heavyweight Reliance Industries was up 1.44% at Rs 1,027.70. The stock hit a high of Rs 1,030 and a low of Rs 1,014.65 in intraday trade.
Tata Motors shrugged off weak Q1 results. The stock was up 2.01% at Rs 503.65. The stock was volatile. The stock hit a high of Rs 515 and a low of Rs 486.10 in intraday trade. The company's consolidated net profit declined 57.25% to Rs 2236 crore on 9.01% growth in revenue to Rs 67056 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours today, 26 August 2016.
The profit before tax fell 67.41% to Rs 2066 crore in Q1 June 2016 over Q1 June 2015. Higher volumes in both standalone as well as Jaguar Land Rover (JLR) business was more than offset by the adverse foreign currency impact of Rs 2296 crore and adverse commodity derivatives impact of Rs 167 crore in the operating profit mainly in the Jaguar Land Rover business. The profitability was also adversely impacted by lower local market incentive in the JLR business as compared to the corresponding quarter last year and higher depreciation and amortization expenses as compared to the corresponding quarter last year.
There was an exceptional income of Rs 478.32 crore in Q1 June 2016 pertaining to further recoveries on account of the Tianjin incident which happened during the previous financial year (FY 2016). Tata Motors attributed the increase in top line during the quarter to strong sales from Jaguar Land Rover (JLR) business and continued volume growth in M&HCV segment and the LCV segment.
Tata Motors board approved raising funds aggregating Rs 3000 crore by way of issue of secured/unsecured debentures and/or bonds in one or more tranches, from time to time.
Biocon gained after European Medicines Agency accepted for review Biocon's partner Mylan's marketing authorization application for a proposed biosimilar Trastuzumab. The stock rose 3.1% at Rs 892.45. The announcement was made after market hours yesterday, 25 August 2016. Mylan N.V., a global pharmaceutical company and Biocon announced that the European Medicines Agency (EMA) has accepted for review Mylan's marketing authorization application (MAA) for a proposed biosimilar Trastuzumab, which is used to treat certain HER2-positive breast and gastric cancers. Mylan and Biocon, which have co-developed this proposed biosimilar, anticipate that this may be the first MAA for a Trastuzumab biosimilar accepted by the EMA for review. This filing includes analytical, functional and pre-clinical data, as well as results from the pharmacokinetics (PK) and confirmatory efficacy/safety global clinical trials for Trastuzumab.
This is the second biosimilar submission developed by the partnership that has been accepted for review in Europe. Last month, Mylan's MAA for the proposed biosimilar Pegfilgrastim was accepted for review by EMA.
Biocon and Mylan are exclusive partners on a broad portfolio of biosimilars and insulin analogs. The proposed biosimilar Trastuzumab is one of the six biologic products co-developed by Mylan and Biocon for the global marketplace. Mylan has exclusive commercialization rights for the proposed biosimilar Trastuzumab in the US, Canada, Japan, Australia, New Zealand, the European Union and European Free Trade Association countries. Biocon has co-exclusive commercialization rights with Mylan for the product in the rest of the world.
Meanwhile, RBI after trading hours yesterday, 25 August 2016, announced a package of measures for the development of fixed income and currency markets. The central said it has been decided to enhance the aggregate limit of partial credit enhancement (PCE) provided by banks, permit brokers in corporate bond repos, authorise the platform for repo in corporate bonds and encourage credit supply for large borrowers through market mechanism. The RBI has allowed banks to issue issue rupee bonds overseas (Masala Bonds) for their capital requirements and for financing infrastructure and affordable housing.
Foreign Portfolio Investors (FPIs) will be given direct access to NDS-OM to ease the process of investment in debt securities. The RBI said it has also been decided to provide FPIs facility to trade directly in corporate bonds.
Meanwhile, the India Meteorological Department (IMD) in its monsoon update issued yesterday, 25 August 2016, said that for the country as a whole, cumulative rainfall during this year's monsoon so far (till 25 August 2016) was 3% below the long period average (LPA).
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