 "Weak IT earnings trip four-day winning streak; Infosys tanks 9%")
Benchmark indices snapped their four-day winning streak weighed down by IT majors like Infosys and TCS post their first quarter earnings. Further, weakness in Europe in wake of the deadly terror attacks in Nice, France also dented investor sentiment.
The S&P BSE Sensex fell 106 points to end at 27,837 and Nifty50 dipped 24 points to settle at 8,541. In the broader markets, the BSE Midcap index surged 0.2% whereas the Smallcap index slipped 0.7%.
Anand James, Chief Market Strategist, Geojit BNP Paribas Financial Services says, 'The urge to lock into the week’s stellar gains achieved a feverish pitch, following Infy’s earnings-led 10% plunge. However, state owned banks kept one end up, whose resilience was possibly owing to reports of government planning on easing capital sourcing norms. Global cues were positive early in the day, with Chinese Q2 GDP figures beating estimates, but risk appetite withdrew as day progressed, as reports Nice terror attack weighed on European stocks, and reversed a recovery in Sterling."
Infosys slipped 9% after the company cut full year revenue outlook for the financial year 2016-17(FY17). Tata Consultancy Services also slipped after the company reported a marginal 0.46% decline in consolidated net profit at Rs 6,318 crore for the quarter ended June 2016 (Q1FY17) on a sequential basis.
"Infosys's Q1FY17 has been disappointing but this has come after couple of good quarters and YoY CC growth of 10.9% is healthy and FY17 growth guidance also implies above industry growth rate. After today’s 8% fall, valuation discount to TCS has further widened. Company is making right investments in digital, automation and emerging technologies. Infosys, we believe will lead sector growth in FY17 as well. Sector headwinds related to Brexit persists, however Infosys is relatively better placed in the sector. We retain BUY on the stock and view stock correction as a buying opportunity," said Prabhudas Lilladher in a report.
In overseas stock markets, Asian shares rose after Wall Street struck another record high overnight. Chinese stocks eked out small gains after the release of a slew of economic reports. In mainland China, the Shanghai Composite index was currently up 0.09%. In Hong Kong, the Hang Seng index was currently up 0.04%.
China's economy grew 6.7% in the second quarter from a year earlier, steady from the first quarter and slightly better than expected as the government stepped up efforts to stabilise growth in the world's second-largest economy.
Oil tumbled in Asia on Friday, bucking an equities rally as worries over a supply glut and weak demand returned, with some analysts forecasting crude prices could fall to $40 a barrel.
Back home, the rupee slipped from its initial gains, depreciating by 12 paise to 67.03 against the American currency in late morning deals on sudden bouts of dollar demand from imports and banks amid lower domestic equities.
Shares of information technology (IT) companies were under pressure with the Nifty IT index dropping 4% after Infosys lowered its FY17 constant currency (CC) revenue growth guidance to 10.5%-12% from 11.5%-13.5% earlier.
Among individual stocks, Infosys ended 9% lower at Rs 1,075, after hitting low of Rs 1,052 in intra-day trade post announcement of April-June (Q1FY17) earnings. Tata Consultancy Services (TCS), Cyient, Wipro, Tech Mahindra and NIIT Technologies were down 3%-6%.
TCS fell by over 3% after the company reported a marginal 0.46% decline in consolidated net profit at Rs 6,318 crore for the quarter ended June 2016 (Q1FY17) on a sequential basis.
Hyderabad-based engineering and technology services company Cyient has reported a marginal decline in consolidated net profit at Rs 73.97 crore for the quarter ended June, 2016 as compared with Rs 75.64 crore in the corresponding quarter last year, due to fall in other income and rise in expenditure. The stock slipped over 4%.
NTPC lost over 1% on reports that the company's employees have resorted to heavy selling of shares after lock-in period post subscription to the company's shares in the offer for sale held in February this year.
Shares of automobiles companies were on a roll with the S&P BSE Auto index and Nifty Auto index hitting their respective lifetime highs in an otherwise weak market on expectation of a recovery in second half, driven by a normal monsoon and demand post the implementation of the 7th Pay commission.
Hero MotoCorp and Mahindra & Mahindra touched record highs, while Tata Motors hit a fresh 52-week high on the BSE during intra-day trade. Bajaj Auto and Maruti Suzuki India closed to their 52-week highs.
Reliance Industries rose almost 1% ahead of its Q1 June 2016 results today.
Bharti Airtel has launched an offer which will allow its pre-paid customers to get back 50 per cent of the data consumed in all in-app content downloads between 3 am and 5 am. The stock rose over 3%.
HDFC twins surged between 1%-2%. Housing Development Finance Corporation’s (HDFC)’s masala bonds’ issue has so far seen two-three times subscription for the coupon rate the mortgage lender is perceived to issue the paper at. HDFC turned ex-dividend today for final dividend of Rs 14 per share for the year ended 31 March 2016.
Tata Steel was up 3.56% to Rs 372, with the stock extending its recent rising streak.
L&T rose over 1% after the company said it proposes to sell 15% stake in its subsidiary, L&T Technology Services, through an initial public offer.
The S&P BSE Sensex fell 106 points to end at 27,837 and Nifty50 dipped 24 points to settle at 8,541. In the broader markets, the BSE Midcap index surged 0.2% whereas the Smallcap index slipped 0.7%.
Anand James, Chief Market Strategist, Geojit BNP Paribas Financial Services says, 'The urge to lock into the week’s stellar gains achieved a feverish pitch, following Infy’s earnings-led 10% plunge. However, state owned banks kept one end up, whose resilience was possibly owing to reports of government planning on easing capital sourcing norms. Global cues were positive early in the day, with Chinese Q2 GDP figures beating estimates, but risk appetite withdrew as day progressed, as reports Nice terror attack weighed on European stocks, and reversed a recovery in Sterling."
Infosys slipped 9% after the company cut full year revenue outlook for the financial year 2016-17(FY17). Tata Consultancy Services also slipped after the company reported a marginal 0.46% decline in consolidated net profit at Rs 6,318 crore for the quarter ended June 2016 (Q1FY17) on a sequential basis.
ALSO READ: 5 key takeaways from the Infosys results
"Infosys's Q1FY17 has been disappointing but this has come after couple of good quarters and YoY CC growth of 10.9% is healthy and FY17 growth guidance also implies above industry growth rate. After today’s 8% fall, valuation discount to TCS has further widened. Company is making right investments in digital, automation and emerging technologies. Infosys, we believe will lead sector growth in FY17 as well. Sector headwinds related to Brexit persists, however Infosys is relatively better placed in the sector. We retain BUY on the stock and view stock correction as a buying opportunity," said Prabhudas Lilladher in a report.
In overseas stock markets, Asian shares rose after Wall Street struck another record high overnight. Chinese stocks eked out small gains after the release of a slew of economic reports. In mainland China, the Shanghai Composite index was currently up 0.09%. In Hong Kong, the Hang Seng index was currently up 0.04%.
China's economy grew 6.7% in the second quarter from a year earlier, steady from the first quarter and slightly better than expected as the government stepped up efforts to stabilise growth in the world's second-largest economy.
Oil tumbled in Asia on Friday, bucking an equities rally as worries over a supply glut and weak demand returned, with some analysts forecasting crude prices could fall to $40 a barrel.
Back home, the rupee slipped from its initial gains, depreciating by 12 paise to 67.03 against the American currency in late morning deals on sudden bouts of dollar demand from imports and banks amid lower domestic equities.
ALSO READ: 6 Nifty50 stocks hit record high
Shares of information technology (IT) companies were under pressure with the Nifty IT index dropping 4% after Infosys lowered its FY17 constant currency (CC) revenue growth guidance to 10.5%-12% from 11.5%-13.5% earlier.
Among individual stocks, Infosys ended 9% lower at Rs 1,075, after hitting low of Rs 1,052 in intra-day trade post announcement of April-June (Q1FY17) earnings. Tata Consultancy Services (TCS), Cyient, Wipro, Tech Mahindra and NIIT Technologies were down 3%-6%.
TCS fell by over 3% after the company reported a marginal 0.46% decline in consolidated net profit at Rs 6,318 crore for the quarter ended June 2016 (Q1FY17) on a sequential basis.
Hyderabad-based engineering and technology services company Cyient has reported a marginal decline in consolidated net profit at Rs 73.97 crore for the quarter ended June, 2016 as compared with Rs 75.64 crore in the corresponding quarter last year, due to fall in other income and rise in expenditure. The stock slipped over 4%.
NTPC lost over 1% on reports that the company's employees have resorted to heavy selling of shares after lock-in period post subscription to the company's shares in the offer for sale held in February this year.
Shares of automobiles companies were on a roll with the S&P BSE Auto index and Nifty Auto index hitting their respective lifetime highs in an otherwise weak market on expectation of a recovery in second half, driven by a normal monsoon and demand post the implementation of the 7th Pay commission.
Hero MotoCorp and Mahindra & Mahindra touched record highs, while Tata Motors hit a fresh 52-week high on the BSE during intra-day trade. Bajaj Auto and Maruti Suzuki India closed to their 52-week highs.
Reliance Industries rose almost 1% ahead of its Q1 June 2016 results today.
Bharti Airtel has launched an offer which will allow its pre-paid customers to get back 50 per cent of the data consumed in all in-app content downloads between 3 am and 5 am. The stock rose over 3%.
HDFC twins surged between 1%-2%. Housing Development Finance Corporation’s (HDFC)’s masala bonds’ issue has so far seen two-three times subscription for the coupon rate the mortgage lender is perceived to issue the paper at. HDFC turned ex-dividend today for final dividend of Rs 14 per share for the year ended 31 March 2016.
Tata Steel was up 3.56% to Rs 372, with the stock extending its recent rising streak.
L&T rose over 1% after the company said it proposes to sell 15% stake in its subsidiary, L&T Technology Services, through an initial public offer.