F&O expiry: IT, banks lift Sensex 393 pts up; RIL slips 2.4% post 44th AGM

The Nifty sectoral indices were mixed, with the Nifty IT index, up 2.79 per cent, leading the gainers, while the Nifty PSU Bank index, down 1.4 per cent, bled the most

F&O expiry: IT, banks lift Sensex 393 pts up; RIL slips 2.4% post 44th AGM

The Indian benchmark indices ended the final session of the June series of futures & options (F&O) over half a per cent higher, with major contribution from information technology (IT) stocks. Heavyweight Reliance Industries, meanwhile, was the top Sensex laggard, falling 2.35 per cent even though the company's chairman Mukesh Ambani made a slew of announcements at the firm's 44th annual general meeting (AGM).

In some major announcements, Ambani said that Yasir Al-Rumayyan, Chairman of Saudi Aramco and Governor of PIF, will join the Board of Reliance Industries as Independent Director. Besides, he said that Reliance Industries will invest Rs 75,000 crore in new energy business over the next three years.

Among the headline indices, the S&P BSE Sensex rose 393 points, or 0.75 per cent, to close at 52,699, while the broader Nifty50 index ended the session at 15,790, up 103 points, or 0.66 per cent. Infosys, TCS, and Tech Mahindra were the top Sensex gainer, while apart from RIL, Bharti Airtel and PowerGrid were the top laggards.

The Nifty sectoral indices were mixed, with the Nifty IT index, up 2.79 per cent, leading the gainers, while the Nifty PSU Bank index, down 1.4 per cent, bled the most.

The broader markets, meanwhile, underperformed their benchmark peers, with the S&P BSE MidCap and SmallCap indices ending 0.51 and 0.22 per cent lower, respectively.

Among other individual stocks, Shyam Metalics and Energy (SMEL) made a strong debut on the bourses, with the stock listing at Rs 380, a 24 per cent premium over its issue price, on the National Stock Exchange (NSE). The stock ended the session at Rs 375.50.

Meanwhile, Sona BLW Precision Forgings (Sona Comstar) made a quiet debut on the bourses, with the stock getting listed at Rs 302.40 -- a 4 per cent premium over its issue price of Rs 291 per share on the BSE. The stock, however, extended gains in intra-day deals to end the session at Rs 362.85 apiece.

Global markets

European shares rose on Thursday as investors focused on a steady economic rebound against the backdrop of fears of a tapering in global monetary stimulus, while technology stocks jumped following an overnight rally in their U.S. peers.

The pan-European STOXX 600 was up 0.6 per cent by 0803 GMT, with financial services, retail and bank stocks among the biggest gainers. German shares gained 0.5 per cent as data showed the business climate index rose again in June after hitting a two-year high last month, while nervousness over a Bank of England policy meeting on Thursday weighed on the FTSE 100 .

5:21 PM

EXPERT VIEW :: Gaurav Garg, Head of Research, CapitalVia Global Research on RIL

n my opinion, the major trigger for this AGM is O2C business will benefit overall health of company, long-awaited RIL’s CMD Mukesh Ambani talked about Saudi Aramco as a strategic partner in our O2C business. RIL has been leader in grocery, electronics, and apparel which helped company to generate handsome revenue in next year and has been major contributor in top line of RIL. Retail will be an important arm to look for RIL’s growth. What excited me most is “Jio Phone Next” which is to be available from September 10. Jio working on 5G trials, will collaborate with Google Cloud for solutions, seen as first step towards made-in-India tech. JIO Fiber has become the largest and fastest-growing fixed broadband operator in India. This might be dark horse top line contributor for JIO.

RIL has focused on green energy which will begin with the Jamnagar refinery. I believe RIL to do well in coming quarters firmly based on its core Oil&Gas business which might helped by increasing price of crude in last few quarters, along with Retail and JIO arms. What excites me is the growth of ARPU which was 138 Rs in April quarter which might boost in the coming quarters, I expect this to increase by 25 % in next one year. Based on announcements made and considering next year’s performance of the stock, stock likely to out-perform NIFTY 50 space, as I expect the stock to touch Rs 2650 level in next year.

5:04 PM

TECH VIEW :: Ruchit Jain, Senior Analyst - Technical and Derivatives at Angel Broking

Nifty opened marginally higher and traded with a positive bias during the day. The index managed to end tad below 15800 with gains of over 100 points.

Although Nifty posted gains of 100 points, it was more of a day of consolidation with the range of 15700-15800. The index was managed by the IT stocks which posted good outperformance, while the heavyweight RIL witnessed some pressure ahead of its AGM. It seems that it was more due to the F&O expiry that the indices were locked within a range and there was no major move in today’s session. In last couple of weeks, we had initially seen a price wise correction in Nifty where it corrected from 15900 to 15450; and now the index seem to be going a time-wise correction. It just seems to be a corrective phase within an uptrend and unless any negative development seen, our market should be geared for a resumption of the uptrend soon. The IT heavyweights have shown good strength today but all eyes would now be on the banking space which could play a pivotal role in driving the index. After a sharp upmove at the start of the week, the Bank Nifty has consolidated for three sessions, and if the momentum resumes at the close of the week then it could result into a resumption of the momentum in the market.

The immediate support for Nifty is placed in the range of 15700-15670 while resistance is around 15900 mark. A breakout beyond these boundaries would then lead to a directional move and hence, trader should be vigilant on the mentioned levels

4:44 PM

MARKET CLOSING COMMENT :: Vinod Nair, Head of Research at Geojit Financial Services

Supported by positive global equities and strong buying interest in IT stocks, the domestic market sparked a rally today. Total FDI inflow in April rose 38% YoY led by a 60% YoY rise in equity inflow reassuring continued liquidity support in the Indian market.

Global investors have digested the comments from Fed officials and are looking ahead to key data releases like U.S jobless claims and Bank of England’s decision on interest rates

4:30 PM

MARKET CLOSING COMMENT :: Ajit Mishra, VP - Research, Religare Broking

Markets traded with a positive bias and managed to close half a percent higher on the monthly expiry day. After yesterday’s fall in the index, the benchmark opened with an uptick and inched gradually higher as the day progressed. Among the sectors, IT majors played a crucial part in recovery and select stocks from FMCG and auto pack also aided the index to hold the gains. Eventually, the Nifty ended higher by 0.6% at 15,790 levels. Amid all, the broader indices underperformed wherein midcap ended with losses of 0.3% while smallcap ended flat.

The prevailing consolidation in the index is largely in line with the global counterparts so participants should continue to keep a close watch on the world market for cues. Despite the positive bias, we’re seeing restricted participation so traders should focus more on the selection of sectors and stocks. On the index front, a decisive break above 15,900 in Nifty would pave the way for an up move else consolidation will continue

4:16 PM

MARKET RECAP :: S Ranganathan, Head of Research at LKP Securities

With Q1 of the current fiscal drawing to a close next week, Technology stocks powered Indices as the street bets on the IT sector to deliver the first set of earnings. Even as Reliance spelt out its roadmap and strategies at its AGM today, IT stocks quite clearly hogged the limelight today. The twin listings today from the Primary Market too had a good opening day with both providing 25% gains to IPO investors from their issue price

4:05 PM