Key equity market benchmarks ended with minor cuts for second straight session on Monday. The Nifty managed to close above the crucial 12,000 mark. Sentiment was weak amid ongoing concerns around the coronavirus outbreak in China.
The barometer BSE S&P Sensex fell 162.23 points or 0.39% to 40,979.62. The Nifty 50 index lost 66.85 points or 0.55% to 12,031.50.
The BSE Mid-Cap index fell 0.78% and the BSE Small-Cap index fell 0.43%. Both these indices underperformed the Sensex.
The market breadth was weak. On the BSE, 988 shares rose and 1547 shares fell. A total of 173 shares were unchanged.
Numbers to Watch:
The yield on 10-year benchmark federal paper fell to 6.442% at 16:45 IST compared with 6.439% at close in the previous trading session.
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In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 71.32, compared with its close of 71.44 during the previous trading session.
In the commodities market, Brent crude for April 2020 settlement fell 24 cents to $54.23 a barrel. The contract fell 46 cents or 0.84% to settle at $54.47 a barrel in the previous trading session.
Foreign Markets:
Shares in Europe and Asia edged lower on Monday as the death toll from a coronavirus outbreak surpassed the SARS epidemic, raising alarm bells about its severity.
China's National Health Commission said Monday that the death toll from the coronavirus outbreak had reached 908 in mainland China.
China's producer price index gained 0.1% in January. Consumer prices rose 5.4% year-on-year, rising the fastest in more than eight years last month, with the outbreak of the coronavirus and subsequent shutdowns of transport links across the country.
In US, markets closed lower on Friday, a day after all three benchmark indexes finished at records, as investors locked in recent stock gains following a stellar January jobs report that exceeded economists' expectations. Also on investors' radar were efforts to contain the fast-moving coronavirus amid a busy week of quarterly earnings reports.
The US economy added 225,000 jobs in January, while the unemployment rate ticked up slightly to 3.6% as the share of Americans in the labor force rose by 0.2 percentage point.
Buzzing Indian Segments:
The Nifty Metal index fell 3.02% to 2,628.90. The index surged 9.28% in the previous five trading sessions.
Sail (down 5.45%), NALCO (down 3.99%), Hindalco Industries (down 3.32%), Vedanta (down 3.01%), JSPL (down 2.28%), Hindustan Copper (down 1.54%), Hindustan Zinc (down 1.05%) and NMDC (down 0.75%) declined.
JSW Steel declined 0.52%. The steel maker has reported crude steel production of 14.10 lakh tonnes for January 2020 compared to 14.53 lakh tonnes in January 2019, recording a decline of 3%. Production of flat rolled products stood at 10.25 lakh tonnes in January 2020 compared to 10.40 lakh tonnes in January 2019, lower by 1%. Production of long rolled products stood at 3.42 lakh tonnes in January 2020 compared to 3.44 lakh tonnes in January 2019, lower by 1%.
Tata Steel slumped 5.80%. On a consolidated basis, Tata Steel reported a net loss of Rs 1084.62 crore in Q3 December 2019 (Q3 FY20) as against a net profit of Rs 2283.98 crore in Q3 December 2018 (Q3 FY19). Net sales declined 8.7% to Rs 34774.29 crore in Q3 FY20 as against Rs 38086.29 crore reported in the same period last year. Consolidated EBITDA fell 45.60% year-on-year (YoY) to Rs 3,659 crore in Q3 FY20.
The Nifty Auto index fell 2.53% to 7,860.55. The index has declined 3.46% in two trading days.
The Society of Indian Automobile Manufacturers (SIAM) announced the sales figures for January 2020. Domestic passenger vehicle sales declined 6.2% to 2,62,714 units in January from 2,80,091 units in the year-ago month. Motorcycle declined by 15.17% to 8,71,886 units in January 2020 from 10,27,766 units a year earlier. Total two-wheeler sales in January fell 16.06% to 13,41,005 units as compared to 15,97,528 units in the same month last year. Sales of commercial vehicles were down 14.04% to 75,289 units in January 2020 over January 2019.
Eicher Motors (down 3.22%), Tata Motors (down 2.68%), Hero MotoCorp (down 2.34%), TVS Motor Company (down 2.18%), Bajaj Auto (down 1.09%) and Ashok Leyland (down 0.96%) declined. Escorts rose 0.24%.
Maruti Suzuki India declined 1.11%. The car major announced a 2.16% decline in total production in January 2020 to 179,103 units from 183,064 units reported in January 2019.
Mahindra & Mahindra (M&M) fell 7.16%. M&M's profit after tax (excluding one-off items and EI) rose 7% to Rs 934 crore on a 6% decline in revenue to Rs 12,120 crore in Q3 December 2019 (Q3 FY20) over Q3 December 2018 (Q3 FY19). The results include the combined earnings of M&M and Mahindra Vehicle Manufacturers (MVML), which is a manufacturing unit of M&M. The combined EBITDA grew 1.60% to Rs 1,793 crore in Q3 FY20 from Q3 FY19. In Q3 FY20, M&M accounted exceptional and one-off items Rs 554 crore as compared to a net gain on account of exceptional and one-off items of Rs 519 crore in Q3 FY19.
Stocks in Spotlight:
Avenue Supermarts surged 8.63% to Rs 2484.15. The stocks has hit an all time high of Rs 2,537 in intraday today. The company has crossed Rs 1,55,000 crore in market capitalization today.
Britannia Industries fell 3.08%. The FMCG major reported 23.92% rise in consolidated net profit to Rs 372.63 crore on 5.02% rise in total income to Rs 3048.16 crore in Q3 December 2019 over Q3 December 2018. During this phase of sluggish demand, the company continued to invest in enhancing brand equity through focused product campaigns.
Cement major ACC lost 3.38% after consolidated net profit dropped 62.7% to Rs 273.25 crore in Q4 December 2019 (Q4 FY 2019) as against Rs 732.31 crore reported in Q4 December 2018 (Q4 FY 2018). Net sales rose 4.8% year-on-year (Y-o-Y) to Rs 3,969.77 crore in Q4 FY 2019, supported by sales and marketing initiatives. The operating EBITDA grew 11% to Rs 541 crore in Q4 December 2019 from Rs 488 crore in Q4 December 2018 on the back of internal efficiencies.
Grasim Industries tumbled 3.60%. On a consolidated basis, the cement major's net profit declined 28.25% to Rs 680.27 crore in Q3 December 2019 as against net profit of Rs 948.11 crore in Q3 December 2018. Total revenue declined 1.37% year-on-year (YoY) to Rs 19205.05 crore in Q3 December 2019 over Q3 December 2018. Profit before tax (PBT) for Q3 December 2019 stood at Rs 1454 crore, down by 16.82% from Rs 1748 crore in Q3 December 2018. EBITDA declined 4.78% to Rs 2968 crore in Q3 December 2019 as against Rs 3117 crore reported in Q3 December 2018.
Cipla rose 0.27%. The drug major acquired 4 brands -- CPink, CDense, Productiv and Folinine -- from Wanbury to further strengthen its presence in women's health. The nutraceutical products, to be sold under the 4 umbrella brands, would address various health needs for conditions arising due to nutritional deficiencies or insufficiencies.
Dr Reddy's Laboratories shed 0.09%. Curis, a biotechnology firm focusing on the development of innovative therapeutics for cancer treatment, has entered into an amendment of its collaboration, license and option agreement with Aurigene, a subsidiary of Dr Reddy's.
Motherson Sumi Systems (MSSL) slumped 5.56% after the company reported 30.47% decline in consolidated net profit to Rs 270.51 crore in Q3 December 2019 (Q3 FY20) over Q3 December 2018 (Q3 FY19). Revenue from operations declined 4.91% to Rs 15,436.46 crore in Q3 FY20 from Rs 16,233.65 reported in Q3 FY19. Profit before tax or PBT in the December quarter stood at Rs 463 crore, down by 43.83% from Rs 824.25 crore in the same period last year. EBITDA decreased by 10.67% to Rs 1264 crore in Q3 FY20 from Rs 1415 crore in in Q3 FY19, amid challenging global market conditions. As on 31 December 2019, the company's consolidated net debt stood at Rs 8,589 crore compared with Rs 8,792 crore on 30 September 2019 and Rs 7,992 crore on 31 March 2019.
Gail (India) declined 0.98%. Consolidated net profit jumped 12.93% to Rs 2,029.51 crore in Q3 December 2019 (Q3 FY20) as against Rs 1,797.04 crore reported in Q3 December 2018 (Q3 FY19). Revenue from operations declined 11.52% year-on-year (Y-o-Y) to Rs 17,898.16 crore in Q3 FY20. The Q3 earnings were announced during trading hours today, 10 February 2020. Profit before tax gained 5.48% to Rs 2,816.31 crore Y-o-Y. Current tax expenses slumped 9.85% to Rs 786.80 crore during the period under review.
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