Shares of Indiabulls Real Estate (up 5.10 per cent), Sobha (up 4.51 per cent), Godrej Properties (up 4.04 per cent) and Oberoi Realty (up 3.99 per cent),were the

MARKET WRAP: Sensex slips 215 points, HDFC Bank falls 3%; Realty stocks hit

Benchmark indices ended lower on Monday led by losses in banking sector and real estate sector.

The S&P BSE Sensex ended at 35,012, down 215 points while the broader Nifty50 index settled at 10,628, down 68 points. HDFC Bank was among the yop losers, slipping over 3 per cent to Rs 2,045 levels. Realty stocks came under selling pressure with the Nifty Realty index ended over 3 per cent lower. HDIL, Phoenix Limited, Prestige, Indiabulls Real Estate and Brigade Enterprises were among the top losers that slipped up to 4 per cent.

Meanwhile, foreign investors pulled out a massive Rs 297.14 billion from the capital markets in May, making it the biggest outflow in 18 months, primarily due to a surge in global crude prices. This comes following an outflow of Rs 155.61 billion from the capital markets (equity and debt) in April. Prior to that, foreign investors had pumped in Rs 26.62 billion in March.

GLOBAL MARKETS

Asian shares rose to their highest in two-and-a-half-weeks on Monday as strong US jobs data offset worries that tariff wars between the United States and the rest of the world could retard global economic growth. MSCI’s broadest index of Asia-Pacific shares outside Japan gained 1 per cent to a high last seen on May 17, while Japan’s Nikkei rose 1.3 per cent.

RBI POLICY PREVIEW

The Reserve Bank of India (RBI) is getting poised to raise interest rates for the first time since January 2014, analysts say – the question is whether this will happen on Wednesday or in August.

The anticipated increase could put a dent in growth, which has recovered after blows from the November 2016 demonetisation and the bumpy July 2017 launch of a national goods and services tax. India reported stellar 7.7 annual per cent growth for the quarter ended March 31. But the key concern of the central bank, which has long kept the repo rate at 6 per cent, is the inflation rate, which is widely expected to climb further.

(with Reuters inputs)

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03:44 PM

Nifty Bank index ends 1.63% lower. Top losers:

COMPANY LATEST PREV CLOSE LOSS() LOSS(%)

BANK OF BARODA 131.55 136.95 -5.40 -3.94

IDFC BANK 39.15 40.75 -1.60 -3.93

HDFC BANK 2046.20 2110.60 -64.40 -3.05

FEDERAL BANK 81.20 83.00 -1.80 -2.17

ST BK OF INDIA 263.00 266.70 -3.70 -1.39

03:39 PM

Nifty sectoral losers of the day

03:36 PM

BSE Sensex: Dr Reddy’s, Infosys among top gainers of the day, HDFC Bank top loser

03:32 PM

Market at close

The S&P BSE Sensex ended at 35,012, down 215 points while the broader Nifty50 index settled at 10,628, down 68 points.

03:14 PM

Avanti Feeds, Waterbase extend fall on growth concerns

Shares of shrimp exporters Avanti Feeds and Waterbase have fallen more than 50% from their respective 52-week highs on concerns of decline in exports in the current financial year 2018-19 (FY19) due to prevailing un-favourable conditions. READ MORE

03:07 PM

With deal to close this week, Bayer to retire Monsanto name

Germany’s Bayer will wrap up the $63 billion takeover of Monsanto on Thursday and also retire the U.S. seeds maker’s 117 year-old name. The German drugmaker had received all required approvals from regulatory authorities, it said in a statement on Monday. READ MORE

02:59 PM

Gold steady as trade war concerns offset US rate hike prospects

Gold prices traded within a narrow range on Monday as lingering concerns about trade wars between the United States and the rest of the world offset expectations of a US interest rate hike this month.

Spot gold was nearly unchanged at $1,293.23 per ounce, after hitting its lowest since May 23 at $1,289.12 in the previous session. READ MORE

02:48 PM

China’s Xiaomi eyes $3 billion CDRs in $10 billion July listing plan: sources

Chinese smartphone maker Xiaomi plans to raise up to 30 percent of its blockbuster $10 billion IPO by selling shares in mainland China while offering the remainder in Hong Kong, people with knowledge of the matter told Reuters on Monday. READ MORE

02:29 PM

Stocks at 52-week low

COMPANY PRICE() 52 WK LOW CHG() CHG(%)

ABAN OFFSHORE 128.60 128.60 -7.90 -5.79

ADANI POWER 18.70 18.60 -0.90 -4.59

AJANTA PHARMA 933.45 925.05 -7.25 -0.77

ALLCARGO LOGIST. 112.40 112.00 -5.25 -4.46

AMBUJA CEM. 201.00 200.75 -2.40 -1.18

» More on 52 Week Low

02:28 PM

Centrum on La Opala

We maintain our Buy on La Opala with target price of Rs353 and value the company on our conservative Adj. OCF/EV yield based methodology. We believe the company would continue to post strong double digit volume growth in the opalware segment on the back of affordable pricing and significant under penetration of the category.

Further announcement of setting of new plant at a cost of Rs1.35bn would help the company increase capacity from current 25K MT to 37K MT which we believe would be utilised over ~2.5 years and the commercial production would start from Sep’19. Further the management would aggressively spend on advertising in FY19 with a budget of Rs120-150mn against spend of mere Rs40mn in FY18 which would help the brand given aggressive competition.

02:27 PM

Centrum on Sun Pharma

We maintain our Hold rating on Sun Pharma (SPIL) with TP of Rs530 (earlier Rs520) based on 26x March’20E EPS of Rs20.4. SPIL’s Q4FY18 revenues were in-line with our expectations. EBIDTA margin and net profit exceeded our expectations. The drug maker’s revenue declined 2% YoY, margins improved by 240bps to 24.1%, and net profit grew 10% YoY.

The company is facing supply constraints at its Halol facility. Key upside risks to our assumption include higher revenues from the US market and key downside risk includes regulatory risks for its manufacturing facilities catering to the global markets. We recommend a switch to Aurobindo or Cipla

02:15 PM

Keep a close eye on credit quality, financials of NBFCs before investing

With non-bank financial companies (NBFCs) finding it difficult to raise funds from banks, the total issuance of non-convertible debentures (NCDs) from them is expected to cross the previous high this financial year, according to ICRA Ratings. In 2013-14, they had raised a record Rs 423.83 billion. With many of the recent issuances offering returns of above 9 per cent, investors are likely to be attracted to them. However, they should do proper due diligence before investing in these instruments. READ MORE

02:00 PM

Market Check

S&P BSE Sensex 35,127.71 Up -0.28%

Nifty 50 10,668.70 Up -0.26%

S&P BSE 200 4,610.86 Up -0.41%

Nifty 500 9,210.95 Up -0.48%

S&P BSE Mid-Cap 15,759.03 Up -0.59%

S&P BSE Small-Cap 16,705.12 Up -1.61%

01:41 PM

Edelweiss on GMR Infrastructure

GMR Infrastructure (GMR) reported Rs 49mn profit for Q4FY18, aided by: (a) recognition of additional ~Rs 6.3 bn revenue in Kamalanga and EMCO, post a favourable CERC order; and (b) higher profits at Hyderabad Airport (HIAL) and Indonesian coal mine (PT GEMS). On operational front, traffic improved 12-25% YoY on the company’s three operational airports; also, the Kamalanga and EMCO plants are witnessing higher PLFs and lower interest costs.

Delhi Airport (DIAL) also saw favourable regulatory actions, which are likely to significantly enhance long term value. Improvement in cash flow trajectory, finalisation of tariff orders for airports and asset monetisation will be key stock drivers, in our view. Maintain ‘BUY’ with SoTP-based target price of Rs 29

01:40 PM

NEWS ALERT MK Jain appointed deputy governor of RBI; he is currently the MD & CEO of IDBI Bank: TV reports

01:31 PM

MFs offer extra incentives to rake in big money from smaller towns

A little more than 17 per cent of the assets of the mutual fund (MF) industry came from the so-called beyond top 30 (B30) cities, the Association of Mutual Funds in India’s (Amfi’s) data for April shows. At the end of April, assets under management (AUM) from the B30 locations stood at Rs 4.02 trillion, while the top 30 (T30) centres accounted for Rs 19.2 trillion. READ MORE

01:15 PM

The crude oil conundrum

The global crude market could see extreme volatility over the next two years. Both supply and demand are looking uncertain and the global energy mix is changing. Prices through the next two years will be likely to trend up, but with sharp swings in both directions.

Brent oil futures all the way up 2024 are running above $60/barrel. The demand for crude doesn’t vary too much with price. Demand is driven by economic growth, which causes greater power consumption and more transport activity. READ MORE

12:59 PM

Monitoring system for foreign portfolio investors to undergo HDFC Bank test

The new system for monitoring the limits on investment flows from abroad will undergo their first big test on Monday. That is when shares worth Rs 92 billion ($1.38 billion) in HDFC Bank will open for foreign portfolio investor (FPI) buying. READ MORE

12:45 PM

Indian Hotels stock: Well-placed to ride the demand opportunity

After a poor operating performance on account of unfavourable industry dynamics, weak performance of overseas subsidiaries and higher costs, things are looking up for India’s largest hospitality player, Indian Hotels. The improving demand scenario has led to the domestic industry occupancy levels and average room rates for FY18 hitting their highest levels in at least five years. READ MORE

12:30 PM

Consumer stocks: Revival in rural economy to support earnings, valuation

Consumer companies with rural exposure such as Dabur, Emami, Hindustan Unilever (HUL), Marico and Godrej Consumer Products (GCPL) have got a positive response from analysts post-March 2018 quarter (Q4) results. The combined stock index of this pack is up 14 per cent since the beginning of FY19, double the 7 per cent rise in Sensex. READ MORE

12:16 PM

Why inclusion of mainland China stocks in MSCI indices isn’t good for India

The addition of Chinese stocks listed on the Shenzhen stock exchange to the MSCI indices is only token at the moment. There’s a minuscule weight of 0.39 per cent for 234 A-list China shares in the MSCI Emerging Markets Index. MSCI is considering only 5 per cent of the free float for inclusion, that too, in two tranches, in May and August. READ MORE

12:01 PM

FPI outflow hits 18-month high at Rs 297 bn on surge in crude prices

Foreign investors pulled out a massive Rs 297.14 billion from the capital markets in May, making it the biggest outflow in 18 months, primarily due to a surge in global crude prices. This comes following an outflow of Rs 155.61 billion from the capital markets (equity and debt) in April. Prior to that, foreign investors had pumped in Rs 26.62 billion in March READ MORE

12:01 PM

Market at Noon

S&P BSE Sensex 35,231.35 Up 0.01%

Nifty 50 10,685.35 Up -0.10%

S&P BSE 200 4,627.07 Up -0.06%

Nifty 500 9,232.65 Up -0.24%

S&P BSE Mid-Cap 15,827.17 Up -0.16%

S&P BSE Small-Cap 16,796.17 Up -1.08%

11:58 AM

MARKET COMMENT UBS on small-and mid-caps (SMIDS)

Rising interest rates will be an overhang on SMIDS, given our view of a disappointing recovery I growth ahead. Flows are not as supportive as in 2017. The overall market risk-reward seems to be unattractive at current levels and SMIDS are currently trading at about a 20% premium to Nifty, though historically they have traded at a discount. We are Underweight SMIDS as an asset class in our portfolio positioning recommendation. We advocate a bottom-up approach for our top ideas.

The one-year forward PE of the Nifty midcap index is trading at about a 20% premium to Nifty, compared with having been at a discount historically. The premium is starker if we look at PE on trailing earnings basis, reflecting inherently higher growth expectations for SMIDS being priced in.

11:46 AM

HDFC Bank falls nearly 5% from its intra-day’s high

Shares of HDFC Bank have slipped by 2.5% at Rs 2,058 per share, falling 4.6% from their early morning high on the National Stock Exchange (NSE), after more than 10-million equity shares changed hands on the counter through multiple block deals. READ MORE

11:30 AM

INTERVIEW OF THE DAY

HNIs want to diversify; create an offshore portfolio: Citi’s Sameer Kaul

The steady rise global equity markets over the years has been a big draw for investors. SAMEER KAUL, managing director and head of Citi Private Bank, India tells that there is a significant increase in the number of families who wish to diversify their portfolio.

Some families have children studying abroad and are considering purchasing property there, he says. READ MORE

Sameer Kaul, Citi Private Bank PHOTO CREDIT: KAMLESH PEDNEKAR

11:15 AM

Buzzing

Steel Authority of India’s shares rose over 2 per cent as investors cheered a ratings upgrade on the stock. Global research firm Citi has upgraded the stock from neutral from sell and raised the target price by 66 per cent to Rs 83 from Rs 50.

11:01 AM

Deep Industries hits 52-week low; stock tanks 27% in two days

Deep Industries tanked 20% to Rs 107, extending its Friday’s an over 6% decline on the BSE, after the Central Bureau of Investigation (CBI) has booked officials of Oil and Natural Gas Corporation (ONGC) in Rs 800 million scam case. The stock trading at its 52-week low has tanked 27% in past two trading sessions from Rs 147 on May 31, 2018. READ MORE

10:46 AM

The market bias is expected to be negative this year, say experts

The benchmark indices seem to have managed to hold ground, but the overall market breadth has been weak in 2018. The advance-decline ratio for the broad-market BSE 500 index has been deeply in favour of declines in four out of five months of this calendar. READ MORE

10:29 AM

Dr Reddy’s gains 4% as API Srikakulam plant gets USFDA clearance

Shares of Dr Reddy’s Laboratories were trading higher by nearly 4% at Rs 2,010 per share on the BSE in early morning trade after the company said the US health regulator has completed the audit of its API Srikakulam plant (SEZ) with no observations. READ MORE