Stocks
Sensex, Nifty still on an uptrend but bulls tiring - Weekly closing report
Nifty has to stay above 7,870 for the market to head higher
 
We had mentioned in last week’s closing report that Nifty, Sensex is on an uptrend and Nifty may head higher, if it stays above 7,700. For the entire week the index managed staying above this level and closed in the positive for the second consecutive week.  The trends of major indices in the course of the week’s trading are given in the table below:
 
 
On Monday the index opened in the positive and closed higher at 7,915 (up 0.82%). Expectations of healthy quarterly results, along with better-than-expected macro-economic data and forecast of above-average monsoon rains, buoyed the Indian equity markets. Software major Infosys came out with healthy fourth quarter numbers. India's annual wholesale inflation rose a tad to (-) 0.85%  for March from (-)0.91% in the month before, while remaining in the negative zone for the 17th straight month. The Indian equity markets were closed on Tuesday on account of Mahavir Jayanti.
 
On Wednesday, Nifty managed staying above the support of 7,827, but closed flat at 7,915. Profit booking, coupled with negative global indices and weak crude oil prices, kept the bulls in check. After six days of positive trading Nifty closed marginally lower on Thursday. Nifty closed at 7,912 (down 0.03%). Although the index managed making a higher high and a higher low on Thursday on the back of favourable Asian markets cues, it closed flat on account of lack of momentum in an overbought market. Asian markets moved up higher on account of a surge in global crude oil prices. Wipro on Wednesday projected higher revenue from its IT services business for the first quarter (April-June) of this fiscal (2016-17), while net profit dipped 2% in the fourth quarter (January-March) of last fiscal 2015-16 under global accounting norms.
 
Nifty continued to move lower in Friday at 7,899 (down 0.16%). As per recent media reports, the Reserve Bank of India (RBI) has pruned the list of companies whose loans need to be provided for against the risk of default. Lower than anticipated provisioning for non-performing asset could restrict the negative impact on banks' bottom line in Q4 March 2016. RBI has reportedly informed banks individually that they don't have to provide in the March quarter for outstanding loans to 20 firms out of the 150 it had listed in December. The European Central Bank (ECB) yesterday, 21 April 2016, left monetary policy unchanged as expected.

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Nifty, Sensex is a highly overbought zone – Thursday closing report
The market may give up some gains if Nifty closes below 7,874
 
We had mentioned in Wednesday’s closing report that Nifty, Sensex looked overbought and that Nifty looked ripe for a small reversal, if it closed below 7,856. The major indices in the Indian stock market closed flat over Wednesday’s close, as there was little new impetus. The trends of the major indices in the course of Thursday’s trading are given in the table below:
 
 
Key Indian benchmark indices were trading higher on Thursday following favourable Asian markets cues but the market indices closed flat by the end of the day, as there was lack of momentum in an overbought market. At the BSE, good buying was observed in banking, finance, and oil and gas sectors, while selling pressure was seen in telecom sector. The S&P BSE Bankex increased by 2.62%, finance index inched up by 1.82% and oil and gas index went up by 0.94%. However, telecom index dropped by 1.15%. Ahead of the start of trading session in India on Thursday, Asian markets moved up higher on account of a surge in global crude oil prices. Most benchmark indices in the Asia-Pacific region were ruling higher, even though the Shanghai Composite and Shenzhen Composite were shaky.
 
Global software major Wipro Ltd. on Wednesday projected higher revenue from its IT services business for the first quarter (April-June) of this fiscal (2016-17), while net profit dipped 2% in the fourth quarter (January-March) of last fiscal 2015-16 under global accounting norms. "We expect revenue from our IT services to be $1,901-1,939 million ($1,920 average) for first quarter (Q1), as we had 2.4% strong sequential growth ($1,882 million) in fourth quarter (Q4) of fiscal (FY 2016)," the company said in a statement. The company's net profit for quarter Q4, however, declined 2% annually and was flat (0.3%) sequentially at Rs2,240 crore. For fiscal 2015-16, the net profit marginally increased 3% YoY to Rs8,890 crore. Total revenue for the quarter under reference (Q4) increased 12% YoY and 5.9% quarterly to Rs13,630 crore and 9% YoY for fiscal 2016 to Rs51,240 crore. The company also announced buyback of 40 million equity shares of Rs2 face value at a price of Rs625 per equity share from its investors on a proportionate basis through a tender offer. The buyback payable in cash will cost the company Rs.2,500 crore. The quantum of shares (40 million) for buyback, however, represents only 1.62% of total equity capital. The firm's blue chip scrip closed at Rs601.35, which is Rs12.20 or 2.07% from Tuesday's closing price of Rs589.15 and opening price of Rs595 and the day's high of Rs606.75.
 
The top gainers and top losers of the major indices are given in the table below:
 
 
The closing values of the major Asian indices are given in the table below:
 

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Nifty, Sensex looks overbought – Wednesday closing report
Nifty looks ripe for a small reversal if it closes below 7,856
 
We had mentioned in Monday’s closing report that Nifty, Sensex were in a strong uptrend and that Nifty would reverse only if it closed below 7,827. The major indices ended flat after the optimism of last week. The trends of the major indices in the course of Wednesday’s trading are given in the table below:
 
 
Profit booking, coupled with negative global indices and weak crude oil prices, kept the bulls in check the Indian equity markets on Wednesday. Consequently, the key indices of the Indian equity markets closed the day's trade flat. The BSE market breadth was tilted in favour of the bulls -- with 1,471 advances and 1,149 declines. The Indian equity markets were closed on Tuesday on account of Mahavir Jayanti.
 
After coming under attack from Finance Minister Arun Jaitley for his "one-eyed king" comment on India's growth rate, Reserve Bank of India (RBI) Governor Raghuram Rajan on Wednesday seemed to offer the peace pipe to the Centre saying that the country's current growth rate reflects the hard work of the government. “Current growth reflects efforts of government, people,” Rajan said, while at the same time apologising to the visually impaired for his earlier statement. “I want to apologise to a section of the population, the visually impaired, who might be hurt by my statement. My intent in saying 'One-eyed King in the land of blind' was to say that our outperformance is in the midst of global weakness,” Rajan clarified while addressing the 12th convocation of the National Institute of Bank Management, Pune. 
 
Jaitley had on Tuesday objected to Rajan's comment on India's growth saying that a 7.5% growth rate for any other country would have meant a “celebration”. Rajan, however, added that India's growth rate, though commendable, should not lead to euphoria as the potential for further growth is undoubtedly high. “India is the fastest growing large economy in the world. But as a central banker, I cannot get euphoric with India's economic growth rate as it is at the cusp of substantial pick-up in growth. I see scope to grow faster given capacity utilisation and agricultural output," Rajan said. “India has a long way to go to boost per capita income,” he added. Referring to the current status of public sector banks in the country, Rajan said: “RBI has offered all help to Bank bureau in reforms.” The earlier comment from Rajan, who often comes up with some eyebrow-raising one liners, had not gone down well with the central ministers. First Commerce Minister Nirmala Sitharaman said she did not approve of his use of words, followed by an observation from Minister of State for Finance Jayant Sinha. 
 
Drawing parallels between Reliance Jio and Reliance Communications’ 2003 launch, Deutsche Bank Markets Research has said Bharti Airtel appears to be better prepared with its 4G plans and it does not anticipate any impact on its revenue share or margins from the Jio launch. “There are parallels between Jio's current playbook and Reliance Communications’ launch in 2003; the executive management is the same in both instances. Reliance Communications' pan-India launch was on a scale comparable to that of the incumbents and it surpassed Bharti's voice throughout within three years,” the research report said here on Wednesday. “However, Bharti’s revenue share and margins were not affected by its entry. Bharti appears better prepared this time and, contrary to investor expectations, we do not anticipate any impact on its rev-share or margins from Jio’s launch. We believe Bharti’s business performance is poised for multi-year improvement,” it added. Reliance Jio's full commercial launch is expected by December this year. Repeated postponements have dogged the project. The continuity in Bharti's management and the lessons learnt post Reliance Communications' launch in 2003 have likely helped it to anticipate Jio's strategy this time around. “Bharti has been strategic in acquiring the largest amount of incremental spectrum since 2014. This has helped it to pre-empt Jio by launching 4G on a pan-India basis and increase the competitive gap with incumbent peers, which remain spectrum constrained in their key markets,” Deutsche Bank Market Research stated. It said Jio will impact data yields but not the revenue table of the sector. “We expect data yield to fall 20% per annum for next three years to reach Rs0.12 per MB compared to the current level of Rs.0.24 per MB. However, we believe Jio will not affect package pricing - it is likely to offer more data at existing price points.” The report said: “Bharti rev-share and margins are unlikely to be affected by Jio's launch. Weaker players that have a combined 25% revenue share are more at risk.” Bharti Airtel shares closed at Rs356.50, down 0.57% on the BSE.
 
Housing Development Finance Corp (HDFC) on Wednesday said it intends to sell up to 10% stake in its life insurance arm by way of an initial public offer when market conditions are favourable. The development financial institution held a 61.3% stake in the non-listed HDFC Standard Life Insurance Company as on March 31, and said in a regulatory filing with the bourses that it intended to retain it as a subsidiary after the public offer. For the financial year ended March 31, HDFC Life had a gross premium income of Rs.16,313 crore and a total income of Rs.17,954 crore. The profit-after-tax was Rs.818 crore, while the net worth was Rs.3,150 crore. The announcement on divestment was made just before the opening bell at Indian bourses on Wednesday. HDFC Life is a joint venture between the Indian financial institution and Standard Life, a global long-term investment savings player with headquarters at Edinburgh in Britain. Earlier this year, HDFC had concluded the sale of another 9% stake in HDFC Life to Standard Life for around Rs.1,700 crore, to take the British company's holding to 35% from the earlier 26%. This had valued HDFC Life at around Rs18,500 crore. The group now hopes for a valuation of around Rs22,500 crore during the public offer. HDFC shares closed at Rs1,138.40, up 0.98% on the BSE.
 
The top gainers and top losers of major indices are given in the table below:
 
 
The closing values of the major Asian indices are given in the table below:
 

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