Nifty ends above 9,950, up 1% for the week; Sensex settles 161 pts higher

Catch all that happened in the market here

10:46 AM

Morgan Stanley on GDP data

 

GDP growth decelerated to 5.7% YoY in June 2017, a downside surprise to us and consensus. The primary and manufacturing sectors were the key drags, along with net external demand.

 

We continue to anticipate further acceleration in growth in the coming quarters and maintain our constructive view on the macro outlook. The economy has been affected by the idiosyncratic factors of the currency replacement program and implementation of GST, but these events are now in the rear view mirror.

 

Moreover, despite the impact of GST-related destocking on production, underlying demand has remained strong, as evident in the robust growth in discretionary consumption items such as two-wheeler sales. 

 

The impact from GST should be transitory once the one-time adjustment to the new tax regime has been made. Hence, as the impact of these factors wears off, underlying economic growth should recover. The key risks to the outlook are the impact of weaker monsoon on agricultural output; the pace of NPL resolution, which would affect credit growth; and private capex and global trade conditions.

10:44 AM

Buzzing stock

 

Bajaj Auto gained 3% to Rs 2887 after the total sales of the auto major jumped 3% to 335,031 units in August 2017 compared to 325,347 units reported in the same month of last year. Total sales included domestic sales of 200,659 units and exports of 134,372 units in August 2017.

10:35 AM

Nikkei PMI for August

 

Up from July’s 101-month low of 47.9 to 51.2 in August, the Nikkei India Manufacturing Purchasing Managers’ Index signalled a renewed improvement in the health of the sector. The upturn reflected resumed growth of new orders, production and employment.

 

10:33 AM

RBI warns govt on farm loan waivers

 

Terming farm loan waivers a "quick-fix", the RBI again voiced its concern, saying they will lead to a lasting adverse impact on farm productivity. States including Uttar Pradesh and Maharashtra have announced farm loan waivers adding up to Rs 1.3 trillion or 0.8 per cent of GDP this fiscal. READ FULL REPORT HERE

10:24 AM

GDP forecast (Souce: CARE Ratings)

 

We expect growth for the year to be between 7.1-7.3% as against 7.6-7.8% earlier. This growth is premised on acceleration in the next three quarters

10:22 AM

F&O watch

 

There was significantly lower open interest rolled over to the next series, along with incremental short index futures positioning from FIIs. Nifty ended August series at 9,918 levels, snapping the winning streak of seven consecutive positive expiry gains, recording a loss of ~1.06% on (expiry-on-expiry) eoe basis. Private Banks showed discernible signs of fatigue, as was evident from Bank Nifty's under-performance which lost 2.49% eoe.

 

10:18 AM

Bank of America-Merrill Lynch (BofA-ML) on GDP data

 

We ‎grow more confident of our December 6 25 basis point (bps) RBI rate cut call after lower-than-expected June quarter GVA growth of 5.6% (vs a still-anemic 6.2% consensus, 6.7% BAMLe) in new series and about 5% in old series. We cut our FY18 GVA growth forecast to 6.9% from 7.2% in new series and 5.7% from 6% in old series, well below our 7% old GDP potential. 

 

Although inflation is turning up to 3.1% in August on rising tomato and onion prices and 4.6-4.9% in 1H18, it is still well within the RBI's 2-6% inflation target. Meanwhile, investment continued to slip to 27.5% of GDP in June 2017 from 29.2% in June 2016 with high lending rates curtailing demand and sustaining excess capacity. This supports our standing call that investors play consumption over investment

10:16 AM

Emkay Global on GDP data

 

We expect gradual recovery in H2FY18 on the back of higher government spending, continued remonetisation and stabilizing GST related dislocations. Investment activities are likely to remain muted in Q2-Q3FY18, as re-pricing of government contracts due to GST might lead to lower new order activity. Government revenue expenditure has been the primary growth driver in FY17; trend is likely to continue in FY18 as well

10:16 AM

New kid on the block

Shares of Aditya Birla Capital, the newly formed financial services company of the Aditya Birla Group, got listed at Rs 250 on NSE and were trading 5% lower over its listing price. READ FULL REPORT

Kumar Mangalam Birla, chairman of Aditya Birla Group

10:14 AM

Nomura on GDP data

 

We see three insights. (1) Cash-intensive sectors have rebounded with remonetisation. (2) The pace of recovery was dampened by GST-related challenges in Q2, particularly for manufacturing. (3) The adverse impact of lower food prices on rural incomes is weighing on growth (agriculture value addition and rural consumption).

 

Overall, the data suggest that the growth profile remains uneven with still lacklustre industry/investment demand but steady services/consumption demand. Even as headline GDP data have disappointed, the turnaround in private services suggests that the growth cycle will head higher once the GST effects fade.

 

Looking ahead, the key question is how soon the economy will recover from the GST-led disruptions. While both the manufacturing and services PMI contracted in July, the future output index remained elevated. Nomura’s Composite Leading Index for India is also signaling a growth recovery in the coming quarters

9:59 AM

Sectoral trend 

All but two sectors were trading with gains

Source: NSE

 

9:42 AM

JP Associates up 3% on plans to raise Rs 2,000 crore

 

Debt-ridden Jaiprakash Associates gained over 3% to Rs 24 after the company said its proposed sale of entire 74% stake in Bhilai Jaypee Cement for an enterprise value of Rs 1,450 crore is expected to be concluded by year-end and plans to raise up to Rs2,000 crore through sale of securities.

9:36 AM

Nifty's earnings growth to take off from September quarter

 

Expect Nifty earnings growth to move to double digits from the September 2017 quarter onwards, foreign brokerage CLSA has said. The brokerage said the macroeconomic environment is improving as “disruptive forces” such as demonetisation, goods and services tax (GST) and bad loan recognition are fading. READ DETAILS HERE

9:30 AM

DRL top Sensex gainer 

Dr Reddy's Laboratories rallied over 7% to Rs 2167 after the drugmaker reached a settlement with nasdaq-listed Vivus Inc over a long-pending patent litigation related to weight management capsule Qsymia. 

9:24 AM

Top Sensex gainers and losers 

Source: BSE