Nifty, Sensex On course to Head Higher - Weekly Closing report
We had mentioned in last week’s closing report that Nifty, Sensex may head higher. The major indices were volatile and closed with losses this week. The trends of the major indices in the course of the week’s trading was:
 
 
The equity markets were closed on Monday on account of Ganesh Chathurthi.
 
On Tuesday, the major indices suffered a deep correction. On the NSE, there were 569 advances, 1,199 declines and 357 unchanged. Investor panic over the country's lower than expected GDP growth figure of 5% in the first quarter ending June, released last week, led the key market indices to decline by over 2% on Tuesday.
 
Ashok Leyland reported a 47% decline in total commercial vehicle sales at 9,231 units in August. The company had posted sales of 17,386 units in the year-ago month, Ashok Leyland said in a statement. The medium and heavy commercial vehicle sales stood at 5,349 units last month as against 13,158 units in August 2018, down 59%. Maruti Suzuki India reported a 33.99% decline in production in August at 111,370 vehicles against 168,725 produced in the year-ago month. The company had produced 133,265 units in July, down from 178,533 units reported for the corresponding month of the last financial year (FY19). Of the total sales, domestic off-take declined nearly 36% to 94,728 vehicles. Domestic passenger vehicle sales were down 36.1% at 93,173 units from 1,45,895 vehicles during the corresponding period last year. 
 
Steel Strips Wheels has achieved August 2019 total wheel rim sales of 10.72 lakhs Vs 14.14 lakhs in August 2018 representing a decline of 24% YoY. The August month saw continued cut in inventory and production from auto makers to further rationalize the inventory. SSWL has achieved gross turnover of Rs131.96 crore in August 2019 vs. 217.77 crore in August 2018, there by recording fall of 39.40% and achieved net turnover of Rs109.76 crore in August 2019 vs. Rs.166.41 crore in August 2018, a fall of 34%. KNR Constructions has received a work order for Rs850 crore from Megha Engineering & Infrastructures Limited, Hyderabad for construction and completion of earthen bund works which are part of Kaleshwaram Project-Formation of Sri Komuravelli Mallanna Sagar.
 
On Wednesday, the major indices went up a bit. On the NSE, there were 914 advances, 845 declines and 359 unchanged. Maruti Suzuki has decided to shut down production of passenger vehicles in Gurugram and Manesar plants in Haryana for two days, on 7 and 9 September 2019. The company said in an exchange filing that "Both days will be observed as no production days”.
 
The Board of Canara Bank will meet on 13 September to consider the amalgamation of Syndicate Bank into Canara Bank. The board will consider capital infusion up to Rs9,000 crore by Government of India by way of preferential issue of equity shares subject to necessary approvals. Gujarat Alkalies and Chemicals may consider the proposal for split/sub-division of its equity shares of the face value of Rs10/- each of the Company. ICRA has revised the long term rating of Indoco Remedies to A from A+. The outlook on the long-term rating is negative. The short term rating has been revised to A2 from A1. 
On Thursday, the major indices opened high but ended with losses over Tuesday’s close. On the NSE, there were 1,129 advances, 631 declines and 356 unchanged. Wipro secured a $300-million (Rs2,156 crore) seven-year deal from ICICI Bank through Vara Infotech for providing a suite of services. The bank contract generated Rs221.5 crore business for Vara in the fiscal 2018-19.
 
Force Motors has reported total sales of 1,971 units during August 2019, as compared to 2551 units in July 2019 and 2083 units in August 2018, a month-on-month drop of 22.74% and YoY drop of 5.38%. The NCLT bench has approved the resolution plan submitted by JSW Steel in respect of the corporate insolvency resolution process of Bhushan Power and Steel Limited. The written order containing the details and terms of such approval, if any, are awaited.
 
ECL Finance of Edelweiss group and State Bank of India have signed a co-origination agreement to increase access to credit for micro, small and medium enterprises (MSMEs). Pursuant to Reserve Bank of India's (RBI) guidelines on co-origination of loans by banks and NBFCs, the alliance aims to leverage combined reach in tier II and tier III markets to ensure timely disbursal of credit to MSMEs. Bajaj Finance Ltd has allotted 14,000 Secured redeemable non-convertibles debentures of face value of Rs10 lakhs each aggregating to Rs1,400 Crores. The instrument has rating of "CRISIL AAA / Stable" by CRISIL Limited.
 
On Friday, the major indices rallied. On the NSE, there were 1,190 advances, 616 declines and 106 unchanged. Indian stocks opened higher on Friday in line with gains in the global markets over hopes of a trade truce between US and China.
 
Following the recapitalisation of public sector banks (PSBs), now public sector insurance companies -- National Insurance, Oriental Insurance and United India Insurance -- are going to be infused with funds worth Rs12,000 crore to boost their capital base and meet regulatory norms, sources said. The Budget had provisioned Rs70,000 crore for PSB recapitalisation and last week a Rs55,250-crore infusion was announced in several PSBs for regulatory and growth requirements. The nodal Department of Financial Services has approved the Rs12,000 crore capital infusion plan in the three state-run general insurance companies as their financial conditions are very weak. 
 
J Kumar Infraprojects has received letter of acceptance from City and Industrial Development Corporation of Maharashtra Limited (CIDCO) for design & construction of coastal Road from Amra Marg to MTHL junction including Airport Link at Navi Mumbai for Rs681 crore.
 
Capacit'e Infraprojects Limited, has received maiden order from City & Industrial Development Corporation of Maharashtra (CIDCO), for a contract value of Rs4,502 Crore (excluding GST) for construction of approximately 21,346 dwelling units with development of commercial area and onsite infrastructure works at Navi Mumbai.
 
Bharat Heavy Electricals Limited (BHEL) has secured an order for emission control equipment for 2x250 MW Bhilai expansion power project in Chhattisgarh. Valued at around Rs450 Crore, the order has been placed on BHEL by NTPC-SAIL Power Company. The order involves supply and installation of Flue Gas Desulphurization (FGD) system. CRISIL has re-affirmed the rating as CRISIL A1+ for the short term debt and commercial paper instruments of Sundram Fasteners Ltd.
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    Weekly Moneylife Indices & Sector Trends
    INDIAN MARKET TRENDS
    For the period from 30 August 2019 to 5 September 2019, ML Mid-cap Index, ML Micro-cap and ML Small-cap Index ended flat. ML Large-cap Index and ML Mega-cap Index fell 1% each. Both, the NIFTY and the Sensex, declined 2%.
     
     
    FUND FLOWS
    Foreigners: Foreign institutional investors were net sellers of equities during the period (Rs4,315.86 crore)....
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  • The Hindu Rate of Growth, All Over Again
    On Monday, 2nd September, came the news that India’s gross domestic product (GDP) had grown by just 5% in the first quarter of this year, way below the expected 5.7%. Remember, this growth rate is calculated with the revised methodology being used for the past three years or so, and is about 1.5%-2% higher than the number arrived at with the previously used method. Hence, 5% growth under...
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