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IT shares decline

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Capital Market
Last Updated : Jul 19 2018 | 10:50 AM IST

The market witnessed a divergent trend as the Sensex firmed up while the Nifty was trading near flat line in morning trade. At 10:18 IST, the barometer index, the S&P BSE Sensex, was up 62.56 points or 0.17% at 36,436. The Nifty 50 index was down 3.40 points or 0.03% at 10,977.05. The Nifty retraced after touching the psychologically important 11,000 mark in opening trade.

Trading was volatile. After opening higher, the market hit fresh intraday low in early trade. The market bounced back in morning trade. The Sensex rose 142.14 points, or 0.39% at the day's high of 36,515.58 in early trade. The index fell 63.27 points, or 0.17% at the day's low of 36,310.17 in morning trade. The Nifty rose 26.05 points, or 0.24% at the day's high of 11,006.50 in early trade. The index fell 43.50 points, or 0.40% at the day's low of 10,936.95 in morning trade.

Among secondary barometers, the BSE Mid-Cap index was down 0.23%. The BSE Small-Cap index was down 0.65%. Both these indices underperformed the Sensex.

The market breadth, indicating the overall health of the market, was weak. On BSE, 607 shares rose and 1261 shares fell. A total of 67 shares were unchanged.

IT shares declined. Hexaware Technologies (down 2.65%), Oracle Financial Services Software (down 2.43%), Persistent Systems (down 1.31%), TCS (down 0.61%), HCL Technologies (down 0.52%), Tech Mahindra (down 0.51%), Wipro (down 0.21%) and Infosys (down 0.12%), edged lower. MphasiS was up 0.90%.

MindTree was down 7.85%. On a consolidated basis, the company's net profit fell 13.2% to Rs 158.20 crore on 12% growth in revenue to Rs 1639.50 crore in Q1 June 2018 over Q4 March 2018. The result was announced after market hours yesterday, 18 July 2018.

Pharmaceutical shares declined. Wockhardt (down 2.6%), Strides Shasun (down 1.87%), Piramal Enterprises (down 1.62%), Cadila Healthcare (down 1.44%), Dr Reddy's Laboratories (down 0.72%), Divi's Laboratories (down 0.7%), Cipla (down 0.68%), Aurobindo Pharma (down 0.4%), Glenmark Pharmaceuticals (down 0.31%), Alkem Laboratories (down 0.26%), Lupin (down 0.17%) and Sun Pharmaceutical Industries (down 0.06%), edged lower. GlaxoSmithKline Pharmaceuticals (up 0.15%) and IPCA Laboratories (up 0.22%), edged higher.

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JK Tyre & Industries rose 1.93% after the company reported turnaround in Q1 result which was announced after market hours yesterday, 18 July 2018. The company reported consolidated net profit of Rs 64.24 crore in Q1 June 2018 as compared to net loss of Rs 117.21 crore in Q1 June 2017. Total income rose 34.57% to Rs 2446.09 crore in Q1 June 2018 over Q1 June 2017. The company's subsidiaries namely, JK Tornel, Mexico and Cavendish Industries have performed well during the quarter. Labour restructuring completed at JK Tornel last year is reaping good dividend which has added to the over-all profitability.

DFM Foods rose 2.31% after the company scheduled a board meeting on 6 August 2018 to consider the proposal of sub-division of equity shares of the company. The announcement was made after market hours yesterday, 18 July 2018.

Overseas, most Asian shares reversed early trend and edged lower. Japan logged a trade surplus in June, after booking a deficit the previous month, official data showed Thursday, with exports rising despite ongoing international trade tensions. Finance ministry data showed a surplus of 721.4 billion yen ($6.4 billion), up 66.5% from a year earlier. Japan's exports were up 6.7% while imports also edged up 2.5%, according to the data.

US stocks finished mostly higher Wednesday as an anecdotal account of business conditions in the Federal Reserve's 12 districts painted an upbeat picture of the domestic economy. The Fed's Beige Book revealed a domestic economy that has rapidly expanded, but one that has run out of room to grow much faster as shortages of skilled workers and rising costs of raw materials risk impeding another leg of expansion. The anecdotal account of business conditions in the Fed's 12 districts showed that 11 regions of the country were growing at a "modest" pace or even faster. Only the states around St. Louis reported "slight" growth.

Meanwhile, Federal Reserve Chairman Jerome Powell appeared before the House Committee on Financial Services Wednesday, 18 July 2018, to face questioning from lawmakers on the Fed's plans going forward. Powell also faced questioning Tuesday.

Testifying on Wednesday in front of the House Financial Services Committee, Powell emphasized the US central bank's desire to raise rates further this year and said he sees few signs that an economic recession is on the horizon.

On a US data front, Housing starts in June dropped by 12.3% from lowered numbers in May and were 3% lower than year-ago levels.

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First Published: Jul 19 2018 | 10:27 AM IST

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