Nifty may bounce back a bit but the trend is lower
We mentioned in Tuesday’s closing report that Nifty, Sensex are headed lower and that Nifty may be headed for 8,100 over the next few days. As expected, the major indices in the Indian stock markets declined sharply on Wednesday. The day’s high of the Nifty was just 8,209.10, showing the struggle to even achieve Tuesday’s low. Bank Nifty fell by as much as 2.43%. The trends in the major indices over the day’s trading are given in the table below:
Fearing that the US interest rates may go up, based on the US Federal Reserve decision on monetary policy, Indian stock market participants were cautious and there was a fall in the major indices by 0.75%-0.80% at the end of the day’s trading. Foreign funds were net sellers of shares worth $10.87 million.
With Indian exporters likely to do well, in case US interest rates are revised upwards, software major Wipro announced winning a five-year IT contract from leading Norwegian retailer Coop Norge Handel AS. "The strategic deal envisages transforming the retailer's enterprise software landscape and upgrading its data centre infrastructure for superior performance," the IT bellwether said in a statement. The Oslo-based century old cooperative firm claims to have 33% market share, with 1,500 stores and 1.3-million members across the Nordic country. "Our engagement will benefit Coop's supply chain and distribution operations and strengthen its move towards an efficient operating model with greater reach and availability," Wipro chief executive for retail Srini Pallia said on the occasion. Wipro shares closed at Rs578.40, up 0.56%.
Regional satellite channel major Sun TV Network said it closed the second quarter of FY16 with 41.37% growth in net profit. In a statement, the company said it has posted a net profit of Rs.218.38 crore for the period under review, up from Rs.154.47 crore posted during the quarter ended 30 September 2014. Sun TV said its total income went up to Rs.588.44 crore for the second quarter of the current fiscal up from Rs.531.22 crore earned for the quarter ended September 30, 2014. Sun TV shares fell 1.88% to close at Rs378.10.
In news about overseas IT players, where US stock markets are bullish, Facebook founder and chief executive Mark Zuckerberg on Wednesday reiterated the need of an open internet platform like its proprietary initiative Internet.org in India while reminding that Facebook always supported net neutrality. "We have always adhered to net neutrality regulations but there are several countries which still do not have norms in place," Zuckerberg said at the Facebook India townhall meeting at IIT Delhi. "We will adapt to them as soon as they are in place as we are in the favour of being 100% net neutral," Zuckerberg said. The townhall at IIT Delhi follows the Menlo Park chapter at Facebook headquarters which was held during Prime Minister Narendra Modi's second US visit.
"Free basics programme under the Internet.org initiative aims to connect the next billion people and we cannot miss India in that vision as it is one of the largest democracies in the world," Zuckerberg told a gathering of 1,100 people expressing his discontent in some way over the ongoing debate about net neutrality.
Mahindra First Choice Services (MFCS) - a multi-brand car services firm owned by Mahindra & Mahindra - on Wednesday unveiled its plans to raise to over 500 the workshops it runs. The workshops network would be expanded to more than 500 during 2016-17 with a turnover target of Rs.150 crore, the company said. MFCS at present has 81 workshops in 60 cities. By April 2016, the company has targeted to increase the total count of workshops on franchisee basis to 200, and planned at least 300 more during 2016-2017. The company logged a turnover of Rs.50 crore during the last fiscal year, and expects to increase it by 50% to Rs.75 crore in the current fiscal year. "During 2016-17, the turnover is expected to double to Rs.150 crore," the company's chief executive officer YVS Vijay Kumar told media persons. Mahindra & Mahindra shares closed at Rs1,229.75, down 1.62%.
Tata Communications on Tuesday night said it posted consolidated net profit of Rs.6 crore for the quarter ended 30 September, a fall of 93% against Rs.92.39 crore profits during the corresponding period in 2014-15. In a filing in the Bombay Stock Exchange, it said that its total income has decreased from Rs.5,235 crore for the quarter ended September 30, 2014 to Rs.5,209.17 crore for the quarter ended 30 September 2015. Tata Communication shares closed at Rs426.30 on Wednesday, down 0.07%.
On the BSE in India, good buying was observed in consumer durables sector, while selling pressure was seen in banking, power and realty sectors.
On the BSE, consumer durables index gained by 1.63%, while bankex plunged by 2.53%, power index dropped by 1.48% and realty index slipped by 1.24%.
The 100-scrip and 200-scrip indices were down by 0.70% and 0.65%, respectively. Mid-cap index ended lower by around 0.55% and small-cap stocks fell 0.01%.
The Sensex gainers were: Cipla, up 1.64% at Rs.695.55; Bharti Airtel, up 1.62% at Rs.358; ONGC, up 1.41% at Rs.251.60; and Tata Motors, up 0.74% at Rs.386.
The losers included: Axis Bank, down 7.36% at Rs.482.95; ICICI Bank, down 4.30% at Rs.271.50; State Bank of India, down 2.67% at Rs.242; and NTPC, down 2.19% at Rs.129.55.
Chinese stocks retreated on Wednesday, with the benchmark Shanghai Composite Index shedding 1.72% to close at 3,375.20 points. The smaller Shenzhen index fell 2.25% to close at 11,494.35 points. The ChiNext Index, which tracks China's NASDAQ-style board of growth enterprises, plummeted 3.07% to end at 2,485.24 points, Xinhua news agency reported.
Tokyo shares ended higher on Wednesday on upbeat domestic earnings reports but sentiment here was also weighed down by the US monetary policy decision due later in the day. The 225-issue Nikkei Stock Average jumped up 125.98 points (0.67%) from Tuesday at 18,903.02, Xinhua news agency reported. The broader Topix index of all first section issues on the Tokyo Stock Exchange was up 4.08 points (0.26%) at 1,547.19.
The top gainers and top losers of the indices in the Indian stock markets are given in the table below:
The closing values of major Asian indices are given in the table below:
Among European indices, the DAX was at 10,769.73, up 0.73% and the FTSE 100 was at 6,387.29, up 0.35%.