We had mentioned in last week’s closing report that Nifty, Sensex were weak and that Nifty would have to stay above 7,800 for the bulls to gain strength. The major indices have been drifting through the week’s trading with low trading volumes. The weekly losses in the major indices are in the range of 1.48%-2.97%. The weekly trends of the major indices in the Indian stock markets are given in the table below:
On Monday, the major indices in the Indian stock markets were trading in the red through Monday and closed with losses of 0.5%-0.6% over Friday’s close. In Monday's trade, buying was observed in basic materials and consumer durables sectors, while selling pressure was seen in banking and telecom sectors. Sector-wise, the S&P BSE basic materials index surged by 1.29% and consumer durables index 1.07%, while banking index dropped by 1.34% and telecom index slipped by 0.80%. The sentiment was cautious as data showed a slowdown in growth in the Indian manufacturing sector in April 2016, with key indices losing nearly 0.5% for the day. The 100-scrip and 200-scrip indices of the BSE were lower by 0.27% and 0.16%, respectively. The mid-cap index was higher by 1.10% and small-cap stocks were up by 0.39%.
On Monday, with core refining business continuing to do well and the commissioning soon of some major projects in the petrochemicals business, the positive views on Reliance Industries remain unchanged, Citi Research said in a report. "In addition, Reliance Industries continues to remain material underweight relative to benchmarks for most investor classes -- foreign institutional investors, domestic mutual funds and emerging market funds," the report said. High cash on the balance sheet also raised expectations.
Regarding the launch of Jio 4G services, the report said the delay was on account of the company leaving no stone unturned to ensure that it does not over-promise and under-deliver on a business in which the capital expenditure will top $22 billion. "It now plans to fully integrate Reliance Communication's 800 MHz spectrum before launch -- making Jio the only player with sub-1GHz pan-India LTE (long-term evolution) spectrum). It plans to increase coverage to 90% (from 70%) before launch," the report added. In the process, however, the report said the company could be testing the patience of investors and eroding its first mover advantage. The report said the reward potential from the company remained favourable and any weakness in the coming weeks or months should be seen as a buying opportunity from a 12-month point of view. The converse would be on the success of Jio and ramp-up of core projects. Reliance Industries shares closed at Rs986.30, up 0.38% on the BSE.
Automaker Mahindra & Mahindra Ltd (M&M) said that it closed last month with sales of 41,863 vehicles. In a regulatory filing at BSE, the company said it sold 41,856 units in April 2016 as against 36,727 units sold in the same month of 2015 -- a growth of about 14%. President and chief executive Pravin Shah expressed happiness over the growth in sales. He hoped the apex court would take into account the role of the automotive industry in the industrial growth while deciding on the ban on diesel vehicles in the national capital region (NCR). Mahindra & Mahindra shares closed at Rs1,335.75, up 0.30% on the BSE.
On Tuesday, Asian markets were subdued after the International Monetary Fund (IMF) warned about the possibility of a slowdown in China and Japan during 2016. However, the Indian equity markets soon rose on the back of short covering, expectations on bankruptcy code being passed through the parliament and a positive US market close. But negative Asian, European markets and caution ahead of Q4 (fourth quarter) results dampened sentiments and the major indices closed with losses over Monday’s close. The BSE market breadth was tilted in favour of the bears -- with 1,484 declines and 1,155 advances.
Two- and three-wheeler maker TVS Motor Company Ltd. on Tuesday said it closed the March quarter with a net profit of Rs117.76 crore compared to Rs90.52 crore. The company's total income went up to Rs2,839.60 crore from Rs2,453.42 crore. The company’s shares closed at Rs287.90, down 9.66% on the BSE.
Housing Development Finance Corp (HDFC) reported a 30.76% rise in consolidated net profit at Rs3,460.46 crore for the fourth quarter ended March, as against Rs2,646.35 crore in the same quarter of 2014-15. In a stock exchange filing, the company said its net profit for the entire last fiscal, was up 16.29% at Rs10,190.26 crore as against Rs8,762.62 crore recorded last year. HDFC also recommended a final dividend of Rs14 per share, in addition to the interim dividend of Rs3. On standalone basis, the company reported a net profit of Rs2,607.05 crore for the fourth quarter, as compared to Rs1,862.43 crore in same period a year ago. For the full fiscal, standalone net profit was Rs7,093.1 crore, as against Rs5,990.14 crore. HDFC shares closed at Rs1,099.50, up 0.62% on the BSE.
Coal India Ltd, the world’s biggest miner, cut production and shipments of the fuel for the first time in more than a year as sluggish demand caused stockpiles to swell. Output in April dropped 3.4% from a year ago to 40.09 million metric tonnes, while dispatches during the month fell 2.5% to 42.45 million mt, Kolkata-based Coal India said in a stock exchange filing. Output and shipments were the lowest since September. Coal stockpiles at the company’s mines had risen to almost 58 million tonnes as of 1 April because of lower off take by power utilities. The company’s shares closed at Rs279.85, down 3.07% on the BSE.
Aurobindo Pharma announced that it has received US Food & Drug Administration (USFDA) approval for its epilepsy prevention drug Lacosamide. The approved product has an estimated market size of $782 million for the twelve months ending February 2016. In a BSE filing, Aurobindo Pharma said that the approved ANDA was bioequivalent and therapeutically equivalent to the reference listed drug product (RLD) Vimpat Tablets, 50 mg, 100 mg, 150 mg and 200 mg of UCB, Inc. Its shares closed at Rs801.95, up 4.19% on the BSE.
Marico, the maker of Parachute hair oil and Saffola edible oil, has been outperforming its FMCG peers since last three months. The company’s consolidated total income from operations have come in at Rs1,307.03 crore in this quarter as against Rs1,556.42 crore in Q3FY16, a decrease of 16%. The company’s EBITDA has come in at Rs216.6 crore as against Rs293.84 crore, a decrease of 26.3%. The company has witnessed a drop in inventories and cost of raw materials. However, depreciation and purchase cost of traded goods has increased. The company’s net profit stands at Rs138.44 crore in Q4FY16 as compared to Rs197.81 crore in the last quarter i.e. a decrease of 30%. Consolidated EPS has come in at 1.07 as against 1.53 in the last quarter. Marico’s shares closed at Rs256.50, down 3.97%.
On Wednesday, negative global cues, along with lower crude oil prices and caution ahead of quarterly results, depressed the Indian equity markets on Wednesday.
The key indices opened on a flat-to-negative note, in-sync with their Asian peers. The equity markets also took cues from the negative close of the US and European indices on Tuesday. Asian markets remained subdued after the International Monetary Fund (IMF) warned about the possibility of a slowdown in China and Japan. Besides, profit booking and caution ahead of Q4 (fourth quarter) results dampened sentiments. The BSE market breadth was tilted in favour of the bears -- with 1,777 declines and 792 advances.
On Thursday, the major indices of the Indian stock markets rallied after three successive days of losses to close with gains of 0.04%-0.64% on Thursday over Wednesday’s close. It was a day of thin trading and the rally was significant in the Sensex shares. Besides, forecast of healthy monsoon rains from international weather forecasters and higher crude oil prices cheered investors. However, the gains were capped due to negative global markets and caution ahead of the release of US non-farm payrolls data. In addition, disappointing fourth quarter (Q4) results dented sentiments. The BSE market breadth was tilted in favour of the bears -- with 1,321 declines and 1,232 advances.
Negative global cues, coupled with profit booking and lower crude oil prices, subdued the Indian equity markets on Friday. The BSE market breadth was tilted in favour of the bears -- with 1,388 declines and 1,128 advances. At the end of Friday’s trading, the major indices ended flat with minor losses over Thursday’s close. The market is moving sideways with small losses over a week’s trading. Bulls are likely to return in strength only when the global cues are favourable.