MARKET WRAP: Sensex slips 106 pts, Nifty ends at 12,175; financials decline

All that happened in markets today

9:03 AM

Market at Pre-open

9:03 AM

Market at Pre-open

9:03 AM

ICICI Securities on Siemens

Reduction in overall commodity prices are expected to support margins in the near-to-medium term. Given the recent fall in valuation, we upgrade the stock to BUY with a revised target price of Rs1,757 (previously Rs1,718). Focus on margins, predictable cashflows from digitisation and short-cycle demand is expected to support medium- to long-term growth.

9:02 AM

ICICI Securities on BHEL

Structural macro challenges in thermal power sector will impact BHEL’s medium-term growth prospects. Given the execution challenges, we cut our earnings estimates by 5.7% and 13% for FY20E and FY21E, respectively, and maintain HOLD with a revised target price of Rs41 (previously: Rs47).

9:02 AM

Rupee opening

Rupee opens weaker at 71.39/$ vs Wednesday's close of 71.33 against the US dollar

9:01 AM

COMMENT :: Moody's on aviation sector

The emergence of the coronavirus in the Asia-Pacific region is curtailing aviation traffic and thus impacting airport revenues, particularly as international travel restrictions are imposed to contain the spread of the virus and airlines announce route suspensions to and from mainland China and Hong Kong. Asia-Pacific based airports face more acute risks than global peers because of their greater concentration of Chinese travelers and their proximity to the main regions affected by the virus, a credit negative.

The depth of the impact ultimately depends on the spread and length of disruptions from the outbreak, and its effect – if any – on long-term demand for travel. However, most rated airports generate solid free cash flows and are able to defer their investment programs. This factor provides a buffer to manage a short-term decline in aviation demand

9:01 AM

COMMENT :: ICRA on inflation data

The internals of the food inflation are worrying, given a broad-based uptick across categories that tend to be sticky, such as proteins, and a narrower-than-expected reduction in the inflation for vegetables. Moreover, the fairly broad-based rise in the core inflation to 4.1% in January 2020, driven by various services, is a cause for concern. Regardless of the level of the CPI inflation, the stance of monetary policy is likely to be retained as accommodative, for as long as the MPC considers the output gap to be negative, in our view. The timing and magnitude of the next rate cut will depend on how quickly inflation appears to be reverting back towards 4%

9:00 AM

Jefferies on ABB

ABB’s Power grids division was demerged in December 2019 into ABB Power Products and Systems India Limited (APPSIL), which will be listed in the future. We have only marginally changed our CY20E-21E EPS, by 0-5%, accounting for some impact of lower automation margins, which has mostly been offset by the lower corporate tax rate in the new regime. Our PT of Rs1,600 values the automation business at 50x PE CY21E, vs blended PE of 41x earlier, including the power grid division (40% discount to the seven-year mean). Downside risk: Sharp scale-down in exports by the parent

9:00 AM

COMMENT :: Nomura on CPI, IIP data

CPI inflation rose to 7.6% y-o-y in January vs 7.4% in December, as a correction in the unseasonally high vegetable prices was countered by high inflationary pressures in the food ex-vegetable and core basket. Core inflation rose to 4.2% y-o-y in January from 3.8% in December, driven by an uptick in gold and telecom prices, both reflecting supply-side shocks, rather than demand-pull inflation.

Meanwhile, industrial production disappointed at -0.3% y-o-y in December vs 1.8% in November, consistent with our view that growth remains anaemic. We believe inflation has peaked in January and will fall sharply in the coming months, while growth is yet to bottom-out and will slow further to 4.3% y-o-y in Q4 vs 4.5% in Q3. As such, we continue to expect a 25bp repo rate cut in Q2 2020, which could get delivered as early as April

8:58 AM

Stocks to watch

Here's a look at the top stocks that may trade actively in today's trading session -

 

YES Bank: The private sector lender will delay the announcement of its December quarter (Q3) results as it is in talks with potential investors, including JC Flowers and Silver Point Capital, for raising equity capital.
 

Bharti Airtel, Vodafone Idea: As per reports, the Department of Telecommunications plans to send out letters to Bharti Airtel and Vodafone Idea, seeking payment of dues, if the industry’s modification plea on the AGR issue is not taken up by the Supreme Court this week. READ MORE

8:54 AM

SoftBank reports near-total wipeout at $100-bn Vision Fund

The dire result is likely to deepen concern about founder Masayoshi Son's ability to secure funding for a second Vision Fund, and give more ammunition to activist investor Elliott Management, which has recently emerged as a prominent shareholder. READ MORE

8:46 AM

NCDEX files papers for Rs 500-crore IPO, third listing by an exchange

The IPO comprises a fresh issue aggregating up to Rs 100 crore and an offer for sale of up to 1,44,53,774 equities by shareholders, according to the draft red herring prospectus (DRHP).

 

The issue is expected to raise about Rs 500 crore, including fresh offering, merchant banking sources said. After BSE and MCX, this would be the third listing by an exchange. READ MORE

8:41 AM

HUL braves slowdown, premium valuation to sustain on Street's thumbs up

Hindustan Unilever (HUL) seems to have braved the slowdown storm that has impacted some consumption stocks. The HUL stock, which hit its all-time high of Rs 2,271 on Wednesday, has gained over 11 per cent since January-end, compared to a sub-1 per cent rise in the Nifty FMCG index. READ MORE

8:33 AM

Today's picks: YES Bank to Eicher Motors, hot stocks to watch on Thursday

YES Bank

 

Current: Rs 35.2
 

Target: Rs 33.5

 

Keep a stop at 36 and go short. Add to the position between 33.75-34. Book profits at 33.5. READ MORE

8:26 AM

Choose instruments with a higher lock-in period to get better returns

Last week, the country’s largest bank – State Bank of India (SBI) – cut the marginal cost of lending rate by five basis points, which is good news for borrowers. But it slashed deposit rates by 10-50 basis points. READ MORE