Sensex falls over 100 points; Axis Bank dips over 5%

Investors have turned cautious ahead of the outcome of US Federal Reserve meet due later today

Benchmark indices continue to trade lower as investors have turned cautious ahead of the outcome of US FOMC meet. Further, selling among select private banks and oil shares has also pulled the markets downward.

By 10:30 am, the 30-share Sensex was lower by 137 points at 27,116 while the Nifty slipped 37 points at 8,196.

The top losers from the Sensex pack are Axis Bank, ICICI Bank, NTPC, ONGC and Dr Reddy’s Labs, all falling down between 1-5.5%.


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Updated at 9:30 am

Markets have extended losses for third straight day and have opened lower ahead of a policy statement from the US Federal Reserve later in the global day today.

The Fed's two-day policy meeting began yesterday and investors are bracing for whether the central bank will hint at a December hike in interest rates.

Further, markets will remain volatile this week ahead of the October derivatives expiry on Thursday.

By 9:35 am, the 30-share Sensex is lower by 137 points at 27,116 while the Nifty has slipped 37 points at 8,196.

The broader markets are, however, outperforming the benchmark indices- BSE Midcap and Smallcap indices are up 0.03-0.2%. Market breadth is positive on the BSE with 771 shares advancing and 614 shares declining.

Meanwhile, foreign portfolio investors (FPIs) bought shares worth a net Rs 9.50 crore yesterday as per provisional data released by the stock exchanges.

MARKET VIEW

According to Anand Rathi’s morning report, “If Nifty manages to cross and hold above 8,250 zones then only buying interest may be seen towards crucial hurdle of 8,300-8,330 zones. On the downside if it sustains below 8,220 and breaks 8,200 zones then profit booking may drag the index towards 8,150 levels. Sensex has to continue to hold above 27,250 to gain its positive action towards 27,500 levels, while if it fails to sustain the 27,150 levels then selling pressure might push the index towards 27,000 and 26,750 levels.”



Q2 EARNINGS

Amara Raja Batteries, Ambuja Cement, Dabur India, Exide Inds, H T Media, JSW Energy, Just Dial, K E C International, Pidilite Inds, Shri City Union, Sun TV Network will unveil their second quarter earnings today.

INDIGO IPO

The Rs 3,000-crore initial public offering (IPO) of InterGlobe Aviation, which operates IndiGo, has got off to a good start. On the first day, the 39.5-million share offering was subscribed 86 per cent.

The IPO, the biggest since December 2012, closes on Thursday.

GLOBAL MARKETS

Asian stocks slipped on Wednesday, taking cues from an overnight decline on Wall Street and capped by caution ahead of a policy statement from the US Federal Reserve due later in the day.

The Australian dollar, already on the back foot following a slide in crude oil, dropped to a 3-week low after soft Australian inflation data paved the way for a further rate cut.

MSCI's broadest index of Asia-Pacific shares outside Japan declined by 0.6%. Shanghai stocks dipped 0.1%, Hong Kong's Hang Seng fell 0.3% and South Korea's Kospi dropped 0.3%.

Tokyo's Nikkei bucked the trend and rose 0.6% on bargain hunting following the previous day's fall.

US stocks slipped on Tuesday on uncertainty over the US rate outlook and disappointing results from Ford and other companies. The Dow fell 0.2% and the S&P 500 retreated 0.3%.

SECTORS & STOCKS

BSE Bankex has plunged by almost 1% followed by counters like Metal, Oil & Gas, Healthcare, IT, Auto, Capital Goods and Power, all falling between 0.1-0.6%. Apart from Consumer Durables, all the sectoral indices are trading in positive zone.

The top gainers from the Sensex pack are Axis Bank, Lupin, ICICI Bank, Vedanta and ONGC.  

Axis Bank has slumped over 6%. Axis Bank, India's third largest private sector lender, reported a 19%rise in net profit to Rs 1,916 crore for the July-September quarter against Rs 1,610 crore in the same quarter of the previous financial year.

However, on a sequential basis, provisions declined from Rs 1,121 crore in the quarter ended June. Net interest margin (NIM), a key indicator of bank’s profitability, declined by 12 basis points to 3.85% as compared to the same quarter a year ago. The management explained that this decline in NIM was on account of base rate cut undertaken by the bank.

Lupin has extended losses for second straight day and is down by almost 2%. The company reported 35% year on year (YoY) decline in its consolidated net profit at Rs 409 crore for the quarter ended September 30, 2015 (Q2FY16), due to single digit growth in net sales and lower other income. The drug maker had profit of Rs 630 crore in the same quarter last year.

Shares of ICICI Bank are down over 1%. ICICI Bank, country's largest private sector lender, has been selected as the best private bank in India in 2015, as per an analysis done by Global Magazine.

ONGC has dipped by over 1%. The company is expected to increase its upstream capital expenditure by 10% next year and intensify its exploration activities, taking advantage of the current depressed global energy market.

Other notable losers are Coal India, Vedanta, L&T, Bajaj Auto and TCS.

On the gaining side, HDFC Bank, HDFC, Tata Motors, Bharti Airtel and Tata Steel have gained between 0.3-1%.

HDFC Bank, India's second largest private sector lender, has rationalised the number of automated teller machine (ATM) network by 276 in the July-September quarter.

Bharti Airtel and Eaton Towers have announced conclusion of the sale and purchase of the former’s tower assets in Burkina Faso.

Among other shares, Navin Fluorine International has rallied 11% to Rs 1,535, also its 52-week high on the BSE, after reporting a more-than-doubled net profit at Rs 23.23 crore for the quarter ended September 30, 2015 (Q2), on back of strong operational performance.

With Reuters and BS Reporter input