Key benchmark indices extended losses for fourth consecutive session on Thursday, dragged by weak global markets. Metal shares tumbled on fears of weak global growth. Yes Bank bounced after management clarified that the bank was on a firm financial footing.
The barometer index, the S&P BSE Sensex, fell 198.54 points or 0.52% to 38,106.87. The Nifty 50 index fell 46.80 points or 0.41% to 11,313.10.
The market breadth was weak. On the BSE, 962 shares rose and 1532 shares fell. A total of 157 shares remain unchanged.
The S&P BSE Small-Cap index fell 0.38%. The S&P BSE Mid-Cap index fell 0.30%.
The Nifty opened lower and an hit the day's low of 11,257 in early trade. The index received strong buying support at 200-day simple moving average (DMA) placed at 11,259. The 50-unit index rebounded from the day's low and regained 11,300 mark in morning trade. Selling pressure in afternoon trade dragged the index once again below 11,300. Decent buying support in the last hour of the trade pushed the Nifty above 11,300-mark.
Overseas, shares in Europe and Asia declined on Thursday after the United States said it would slap tariffs on European goods. The US on Wednesday said it would enact 10% tariff on European-made Airbus planes and 25% duties on French wine, Scotch and Irish whiskies and cheese from across the continent as punishment for illegal European Union (EU) aircraft subsidies. Markets in China and South Korea were closed on Thursday for holidays.
US stocks dropped on Wednesday with data showing slower job creation adding to concerns about a weakening manufacturing sector as President's Trump's trade policies take their toll.
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A private-sector employment report from Automatic Data Processing showed that a modest 135,000 jobs were created in September, and the average monthly job growth for the past three months also fell to 145,000 from 214,000 for the same time period last year.
The Institute of Supply Management showed America's manufacturing sector contracted for a second month in a row in September. The disappointing data in the US mounted Wednesday, when private payrolls for September undercut expectations. The report also sharply revised the August numbers down.
Domestic stock market was shut yesterday, 2 October 2019, on account of Mahatma Gandhi Jayanti.
In the past four trading sessions, the Sensex slumped 2.26% while the Nifty tumbled 2.23%.
On the macro front, the GST collection dropped below Rs 1 lakh crore mark to Rs 91,916 crore in September. The September collection is believed to be the lowest in nineteen months. The revenue during September 2019 declined by 2.67% comparison with the revenue collected during September 2018.
Yes Bank surged 32.97% to Rs 42.55. The bank clarified that the material drop in its share prices on 1 October 2019 was primarily on account of the forced sale of 10 crores equity shares (3.92% equity) triggered by an invocation of pledge on the equity shares of a large stakeholder. Further, the bank confirmed that its financial and operating metrics remain intrinsically sound and stable with liquidity position well in excess of regulatory requirements.
Zee Entertainment Enterprises jumped 7.92% to Rs 251.40 on reports that the company's lenders have agreed to give a six-month extension to repay debt. Zee's chief executive officer, Punit Goenka, told the media that the total amount due to the Indian lenders was approximately Rs 5,000 crore.
Metals stocks were under pressure. Hindalco Industries (down 3.69%), Tata Steel (down 3.36%), Hindustan Zinc (down 2.69%), Nalco (down 2.41%), Hindustan Copper (down 2.36%), Steel Authority of India (down 2.02%), Jindal Steel & Power (down 1.59%) and JSW Steel (down 0.63%).
Vedanta fell 4.66% to Rs 144.35 after a foreign brokerage firm reportedly cut its target price on the stock by 10% to Rs 180 per share from Rs 200 per share. Company-specific triggers are access to Hindustan Zinc's cash, dividend, and potential monetisation of oil-producing assets. The brokerage lowered Vedanta's FY20-22 EBITDA by 6-11% on lower commodity prices, reports added.
MOIL fell 1.40% to Rs 137.50. The firm announced a 5% reduction in prices of Ferro grade, Silico manganese grade (smgr 30% & smgr 25%) fines and chemical grade. The prices are effective from 1 September 2019.
NMDC rose 1.04%. The company announced that the iron ore production for the month of September 2019 declined 30.2% to 1.64 million tonne as against 2.35 million tonnes in September 2018. The offtake for iron ore also declined 18.4% to 1.91 million tonne in September 2019 as compared to 2.34 million in September 2018.
State-run Coal India fell 3.84%. The coal production for the month of September 2019 declined 23.5% to 30.77 million tonne as compared to 40.25 million tonne in September 2018. The offtake declined 20% to 35.18 million tonne in September 2019 as against 43.98 million tonne in September 2018.
InterGlobe Aviation fell 2.37% to Rs 1826.45 after one of the main promoters Rahul Bhatia moved for arbitration proceedings amid differences with co-promoter Rakesh Gangwal. InterGlobe Enterprises and Rahul Bhatia, as claimants have submitted a Request for Arbitration dated 1 October 2019 to the London Court of International Arbitration under the shareholders agreement dated 23 April 2015 (as amendedon 17 September 2015) executed between the IGE Group, Rakesh Gangwal, The Chinkerpoo Family Trust, Shobha Gangwal (together with Gangwal and The Chinkerpoo Family Trust) and InterGlobe Aviation (the company). The IGE Group and the RG Group are promoters of the company. The company has been named as a respondent as it is a party to the shareholders agreement. This dispute relates to claims of the IGE Group against the RG Group regarding compliance with the shareholders agreement and the articles of association of the company and damages. Under the request for arbitration, no relief has been sought against the company. The company has been named as a necessary and proper party to the arbitration. However, presently, no monetary claim, including any compensation or penalty, has been sought against the company.
Biocon advanced 4.50%. The firm announced that the launch of Semglee, the first insulin glargine, in collaboration with Mylan.N.V. Semglee will be available in Australia under Pharmaceutical Benefits Scheme (PBS). Insulin glargine helps in controlling the blood sugar levels of those patients with diabetes. It is indicated for the treatment of type 1 diabetes mellitus in adults.
Hero MotoCorp declined 0.89%. The two-wheeler major sold 6.12 lakh units of motorcycles and scooters in September 2019. With this, the company registered a growth of 12.6% over August 2019 when it had sold 5.43 lakh units. The announcement was made after market hours on Tuesday, 1 October 2019.
M&M was up 1.09% at Rs 562.65 after the company formed a joint venture with Ford Motor Company after buying a 51% stake in the Indian unit of the US auto major.
TVS Motor Company lost 3.45% after total sales fell 25.48% to to 3.15 lakh units in September 2019 over September 2018.
Shares of PSU OMCs advanced after crude oil prices declined in the international commodity market. HPCL (up 4.51%) and Indian Oil Corporation (up 2.36%) advanced.
BPCL rose 7.66% to Rs 531.90, extending recent gains triggered by the buzz of likely privatisation of the company. The stock hit a 52-week high of Rs 540 in intraday today.
In the commodities market, Brent crude for December 2019 settlement was up 2 cents at $57.70 a barrel. The contract fell $1.20 or 2.04% to settle at $57.69 a barrel in the previous trading session.
In the primary market, the initial public offer (IPO) of Indian Railway Catering and Tourism Corporation (IRCTC) was subscribed 111.75 times on the last day of bidding. As of 16:30 IST, the issue received bids for 225.28 crore shares. The IPO will close today, 3 October 2019. The price band for the issue has been fixed at Rs 315 to Rs 320 per share. The minimum order quantity is for 40 equity shares and in multiples thereof.
The government launched the fourth installment of Bharat-22 Exchange Traded Fund (ETF) on Thursday, which is expected to help the exchequer garner up to Rs 8,000 crore from investors. The issue will open for anchor investors on Thursday and for other institutional and retail investors, the next day. The investors would get a 3% discount over the issue price. Proceeds from the ETF will help the government meet its disinvestment target of Rs 1.05 lakh crore for the current financial year. The central public sector enterprises that are part of the Bharat-22 ETF include ONGC, IOC, BPCL, Coal India, Nalco, Bharat Electronics, Engineers India, NBCC, NTPC, NHPC, SJVN, GAIL, PGCIL, NLC India, Axis Bank, ITC and L&T. Among public sector banks SBI, Indian Bank and Bank of Baroda figure in the Bharat-22 index.
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