MARKET WRAP: Sensex ends 139 pts lower, Nifty at 10,808 as Fed hikes rates

The benchmark indices ended lower after the US Federal Reserve raised interest rates and took a more hawkish tone in forecasting a slightly faster pace of tightening for the rest of the year.

The S&P BSE Sensex ended at 35,600, down 139 points while the broader Nifty50 index settled at 10,808, down 49 points.

Among sectoral indices, the Nifty IT index ended 1.5% lower led by a fall in shares of MindTree, Tech Mahindra and Tata Consultancy Services.
 

FEDERAL RESERVE

Investors latched on to a change in Fed policymakers’ rates projections, which pointed to two additional hikes by the end of this year compared to one previously, based on board members’ median forecast.

The Fed has raised rates seven times since late 2015 on the back of the economy's continuing expansion and solid job growth, rendering the language of its previous policy statements outdated.

DOMESTIC ECONOMIC DATA

Back home, the Wholesale inflation spiked to 4.43 per cent in May, from 3.18 per cent in April, according to the government data released on Thursday.

Meanwhile, India's current account deficit (CAD) rose to $13 billion (Rs 878 billion and 1.9 per cent of gross domestic product, or GDP) in the fourth and final quarter (Q4 of 2017-18), compared to $2.6 billion (Rs 176 billion and 0.4 per cent of GDP) in the same period of 2016 -17.

For the full financial year (2017-18), the deficit increased to 1.9 per cent of GDP, from 0.6 per cent in 2016-17. 

GLOBAL MARKETS

Globally, MSCI's broadest index of Asia-Pacific shares outside Japan lost 1.0 per cent. Shares in South Korea and Taiwan fell over one per cent.

Japan's Nikkei dropped 0.6 per cent. In mainland China, the Shanghai composite index hit a 20-month closing low, shedding 0.4 per cent.

(with inputs from Reuters)

3:45 PM

Nifty IT Index ended 1.49% lower. Top losers:

COMPANY	LATEST	PREV CLOSE	LOSS( )	LOSS(%)
MINDTREE	994.05	1028.75	-34.70	-3.37
INFOSYS	1240.00	1274.80	-34.80	-2.73
TECH MAHINDRA	698.40	713.80	-15.40	-2.16
TCS	1785.00	1824.10	-39.10	-2.14
INFIBEAM INCORP.	151.90	153.90	-2.00	-1.30

3:43 PM

Nifty sectoral losers of the day

3:41 PM

BSE Sensex: TCS, ICICI Bank, SBI among top losers of the day, Sun Pharma top gainer

3:33 PM

Market at close

 

The S&P BSE Sensex ended at 35,600, down 139 points while the broader Nifty50 index settled at 10,808, down 49 points.

3:15 PM

Future Supply Chain, Hindustan Aeronautics hit lowest level since listing

Shares of Future Supply Chain Solutions (FSC) and Hindustan Aeronautics (HAL) have hit their respective lowest values since their listing on the bourses. FSC, a Future Group Company, has dipped 7% to Rs 620 on the BSE. The stock made its debut on December 18, 2017, trading 7% lower against its initial public offer price of Rs 664 per share. READ MORE

 

2:59 PM

Euro zone bond markets brace for ECB shift, stimulus scheme nears end

 

European government bond yields in the euro area edged up on Thursday as the European Central Bank prepared to debate whether to end its unprecedented stimulus scheme this year.

 

On Wednesday the US Federal Reserve raised interest rates as expected, and signalled two more hikes this year, citing higher inflation. READ MORE

2:50 PM

Gold futures up by 0.31% to Rs 31,239 on global cues

Gold prices went up by 0.31 per cent to Rs 31,239 per 10 grams in futures trade today as speculators built up fresh positions, taking positive cues from overseas markets.

At the Multi Commodity Exchange, gold for delivery in August month rose by Rs 96, or 0.31 per cent to Rs 31,239 per 10 grams in business turnover of 511 lots. READ MORE

2:40 PM

Reliance Industries hits new high, gains 10% in 3 weeks

 

Reliance Industries (RIL) hit a new high of Rs 1,011.70 up 1% on the BSE in noon deal, surpassing its previous high of Rs 1010.70 recorded on April 27, 2018 in intra-day trade.

 

In past three weeks, RIL has outperformed the market by surging 10% as compared to 4% rise in the S&P BSE Sensex. READ MORE

Reliance Industries

2:29 PM

After 2 yrs of muted sales, United Spirits eyes double-digit growth in FY19

 

The United Spirits stock has shed 15 per cent from its highs earlier this year, mainly owing to regulatory uncertainty weighing on the sentiment of the liquor sector. Demonetisation, and the ban on sale of liquor near state and national highways, besides issues related to the implementation of the goods and services tax, were among the headwinds.

 

The company reported a sales growth of just 3.8 per cent in FY17 and a fall of 4.5 per cent in FY18. READ MORE

2:13 PM

Alembic Pharma up 8% as USFDA approves Doxycycline Hyclate capsules

 

Alembic Pharmaceuticals has moved higher by 8% to Rs 530, bouncing back 11% from early morning low on the BSE after the company announced that it has received US drug regulator’s approval Doxycycline Hyclate capsules USP, 50 mg and 100 mg. The stock hit an intra-day low of Rs 478 in early morning trade.

 

“The company has received approval from the US Food & Drug Administration (USFDA) for its Abbreviated New Drug Application (ANDA) for Doxycycline Hyclate Capsules USP, 50 mg and 100 mg,” Alembic Pharma said in a press release. READ MORE

2:00 PM

Market Check

S&P BSE Sensex	35,615.40		-0.35%
Nifty 50	10,801.35		-0.51%
S&P BSE 200	4,684.64		-0.33%
Nifty 500	9,346.90		-0.42%
S&P BSE Mid-Cap	16,027.31		-0.31%
S&P BSE Small-Cap	17,026.08		-0.02%

1:47 PM

COMMENT Aditi Nayar, Principal Economist at ICRA on WPI

The sharp jump in the WPI inflation to 4.4% in May 2018 surpassed our expectation (4.0%), on account of a spike in inflation for non food manufactured products (core-WPI inflation), reflecting the pass through of higher input costs to wholesale prices in several sectors. Additionally, an expected uptick in the inflation for crude oil and various mineral oils contributed to the hardening of wholesale inflation.

The WPI inflation is expected to harden by up to 80 bps in the ongoing month before easing somewhat in Q2 FY2019. Key factors that would influence the inflation trajectory include the level at which global crude oil prices stabilise and the extent to which they are transmitted to domestic fuel prices, the trend in the monsoon dispersion and the extent of change in MSPs

1:46 PM

Top losers in BSE500:

COMPANY	LATEST	PREV CLOSE	LOSS( )	LOSS(%)
JAGRAN PRAKASHAN	150.00	159.35	-9.35	-5.87
EROS INTL.MEDIA	128.35	133.60	-5.25	-3.93
MINDTREE	994.15	1030.00	-35.85	-3.48
CORPORATION BANK	30.75	31.85	-1.10	-3.45
OBEROI REALTY	509.90	527.85	-17.95	-3.40

1:30 PM

From Amazon to Westbridge, PE firms bet on insurance due to stable rules

The last few months have seen a spurt in private equity deals in the insurance space, with investors like Westbridge Capital and Warburg Pincus buying stakes in Star Health & Allied Insurance and India First Life, respectively (see box). There have been other deals too.

 

Investors, however, latched on to a change in Fed policymakers’ rates projections, which pointed to two additional hikes by the end of this year compared to one previously, based on board members’ median forecast. READ MORE

 

1:14 PM

May WPI Inflation spikes to 4.43% vs 3.18% in April: Govt data

WPI inflation rises to 14-month high of 4.43 pc in May on costlier fuel, veggies. Inflation based on wholesale prices shot up to a 14-month high of 4.43 per cent in May on increasing prices of petrol and diesel as well as vegetables. READ MORE