Post Session: Quick Review

The Indian markets once again showed a sluggish trend on the last trading session of the week, benchmarks despite a positive start and surging to the intraday high in very early trade, gave up gains to end modestly in red on Friday. Markets lost their momentum in the very first hour of trade, though there were futile attempt in late hours but they failed to push the markets back into green and just helped in paring heavy losses. The major jolt to the markets came with IT bellwether Infosys reporting a downbeat earnings and a surprisingly lower guidance. Its first-quarter earnings came in below estimates, reporting a 13% rise in first quarter consolidated net profit to Rs 3,436 crore from Rs3,030 crore a year earlier. It warned that it won’t be able to make its previous revenue target for this fiscal year, cutting its outlook saying that it now expects revenue to grow between 10.5% and 12% in constant currency terms in the year ending 31 March 2017, compared to its previously estimated growth of between 11.5% and 13.5%. Sentiments turned cautious ahead of another major result announcement of Reliance Industries, as the company is expected to report a modest profit growth, while the income is likely to fall marginally, impacted by a planned refinery shutdown and lower refining margins. However, any major losses were capped with report that Monsoon rains in India were 11 per cent above average in the week ended July 13. The June-September monsoon has so far delivered 4 percent higher rainfall than average.

On the global front the mood remained mostly sanguine as the US markets continued their surge with Dow and S&P 500 surging to fresh highs, while Asian markets following the trend ending mostly in green. The Hong Kong-listed stocks of Chinese companies extended their biggest weekly gain in four months and Taiwan’s equities entered a bull market. Japan’s Topix index capped its best week since 2009 and the yen slid on prospects for stimulus. The European markets though made a mixed start, with some of the important indices trading in red, halting this week’s rally as French shares retreated following a deadly terror attack in Nice. Also, on an unexpected decision from the Bank of England to hold its key interest rate steady.

Back home, the early euphoria generated by upbeat earnings of IT major TCS and strong global cues faded, once the Infosys came up with its earnings and guidance for the fiscal. Markets witnessed selling pressure in whole IT pack with traders even booking profit in the TCS, despite its good numbers. The rupee which traded marginally higher against the US dollar in early trades, tracking the gains in the Asian currencies markets, too lost its pace and turned weaker against dollar, weighing down the equity markets. Traders largely overlooked Commerce and Industry Minister Nirmala Sitharaman’s statement that decline in exports have bottomed out and the outbound shipments are expected to witness gradual improvement in the coming months depending upon pick up in global demand. Exporters body FIEO too has stated that decline in exports has largely been arrested and non-oil exports have turned positive after a long gap. Not only IT stocks but PSU and realty too witnessed profit taking and the Nifty 50 which had came very close to breach the 8600 mark slipped below 8550 levels by the end, though Sensex managed to hold its turf past 27800 level. The broader markets made a mixed closing with midcap index on Sensex surging to its fresh all time highs. On sectoral front, metal stocks continued witnessing buying interest along with auto and banking.

The BSE Sensex ended at 27837.88, down by 104.23 points or 0.37% after trading in a range of 27735.87 and 28048.70. There were 17 stocks in green against 13 stocks in red on the index. (Provisional)

The broader indices made a mixed closing; the BSE Mid cap index was tad higher by 0.01%, while Small cap index was down by 0.80%.(Provisional)

The top gaining sectoral indices on the BSE were Auto up by 0.83%, Metal up by 0.61%, Capital Goods up by 0.45%, Bankex up by 0.30%, FMCG up by 0.05%, while IT down by 5.41%, TECK down by 3.99%, Power down by 1.07%, PSU down by 0.72% and Realty down by 0.58% were the losing indices on BSE. (Provisional)

The top gainers on the Sensex were Tata Steel up by 3.70%, Bharti Airtel up by 3.59%, HDFC Bank up by 2.06%, HDFC up by 1.64% and Tata Motors up by 1.50%. On the flip side, Infosys down by 8.84%, TCS down by 3.15%, Wipro down by 2.75%, NTPC down by 1.74% and Coal India down by 1.51% were the top losers. (Provisional)

Meanwhile, giving a big push to infra, the National Highways Authority of India (NHAI) may award 97 projects covering 6,631 km and worth Rs one lakh crore during the current financial year. The NHAI chairman Raghav Chandra has said that the around 97 projects with total length of 6,631 km, are likely to be awarded during the current financial year 2016-17.

Chandra said that more than 30,000 km of road projects are in the pipeline. NHAI has around 250 projects across the country and is expected to spend about $15-16 billion during 2016-17. The highway sector is poised for rapid growth as new opportunities unfold for construction of highways. The focus of NHAI is on development with a changed approach from output-based thinking to outcome-based thinking where PPP projects will be not only for construction component but for service aspect in highways development.

The projects include Vadodara -Mumbai 6/8 lane Expressway (Phase I ), Surat-Mumbai with a spur to Mumbai-Pune expressway and JNPT in Phase II, Delhi-Jaipur expressway, 6-8 lane semi-elevated Delhi-Meerut expressway, Somnath-Porbander-Dwarka section of NH-8E, Bihar/Jharkhand border-Barwa, Hospet-Bellary NH-63, Tamil Nadu Karnataka Border Bengaluru section of NH-209, Solapur-Bijapur section of NH-13, Salasar-Nagpur section of NH-65, Vikravandi-Thanjavur section of NH-45C, and four laning of Nagpur-Wardha-Nanded-Solapur-Ratnagiri section of NH-36.

The CNX Nifty ended at 8538.30, down by 26.70 points or 0.31% after trading in a range of 8510.05 and 8594.80. There were 31 stocks on gainers side against 20 stocks on losers side on the index. (Provisional)

The top gainers on Nifty were Tata Steel up by 3.53%, Bharti Airtel up by 3.22%, Idea Cellular up by 2.88%, HDFC Bank up by 2.14% and Bosch up by 1.92%. On the flip side, Infosys down by 8.96%, TCS down by 3.01%, Wipro down by 2.64%, Tech Mahindra down by 2.54% and Aurobindo Pharma down by 2.24% were the top losers. (Provisional)

European markets were trading in red, Germany’s DAX declined by 60.25 points or 0.60% to 10,008.05, France’s CAC was lower by 37.02 points or 0.84% to 4,348.50 and UK’s FTSE 100 lost 17.14 points or 0.26% to 6,637.33.

Asian markets ended higher on Friday, as better-than-expected Chinese economic data helped outweigh news of a horrific terrorist attack in Nice, France, which killed at least 84 people and wounded dozens of innocent civilians. Markets also took the Bank of England's surprise decision to keep rates on hold in their stride. Meanwhile, China's industrial output strengthened in June, retail sales rose at a faster pace, a broadest measure of new credit rose more than expected and GDP growth held steady at 6.7 percent in the second quarter on the back of Beijing's aggressive stimulus measures, helping ease worries about the country's economic slowdown. Japanese shares rose, with an extended rally on Wall Street, a weakening yen and Line Corp's strong debut in New York and Tokyo bolstering investor sentiment. The yen fell broadly to hit a three-week low versus the dollar. Though, Chinese shares ended unchanged as the latest data dented hopes of additional stimulus.