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Nifty holds 7900 amid pressure; Hindalco, HDFC, Cipla slip

10:00

The News International Team

10:55am Market Check

The Sensex fell 135.18 points to 26432.81 and the Nifty declined 44.30 points to 7901.25. About 1182 shares have advanced, 1074 shares declined, and 102 shares are unchanged.

10:45am Ballarpur Industries in focus

Shares of Ballarpur Industries surged nearly 11 percent as International Finance Corporation will invest USD 100 million (about Rs 616 crore) in Bilt Paper BV, a step-down subsidiary of the paper manufacturer, in lieu of fresh shares.

“BPBV has entered into definitive agreements with IFC for subscription of new shares worth USD 100 million at an implied pre-money valuation of USD 600 million,” Ballarpur Industries had said in a BSE filing yesterday.

“This will result into a shareholding of IFC in BPBV of 14.29 percent,” the company had said. Bilt Paper is also exploring the possibility of listing of its shares at an overseas stock exchange. The subscription of shares is subject to fulfilment of conditions set out in the definitive documents, it said.

In June, Ballarpur had said that BPBV is evaluating and exploring options with IFC for receiving potential investment from IFC, in a combination of debt and/or equity in BPBV and/ or its step-down subsidiaries.

10:20am World Bank on Indian economy

Indian economy, which accounts for 80 percent of South Asia’s output, is set to grow by 6.4 percent in 2015-16 as against 5.6 percent in 2014-15, the World Bank has said.

With economic activity buoyed by expectations from the new elected government of Prime Minister Narendra Modi, “India is benefiting from a “Modi dividend”,” the Bank said in its twice-a-year South Asia Economic Focus report yesterday.

Over the next year or so economic growth should be supported by the recovering US economy that would provide a market for Indian merchandise and service exports, it said.

“The outlook over the next years for South Asia indicates broad economic stability and a pick-up in growth with potential risks concentrated on the fiscal and structural reform side,” said Martin Rama, Chief Economist for South Asia at the World Bank.

“Future growth will increasingly depend on strong investment and export performance,” he added.

Private investment is expected to pick up thanks to the government’s business orientation, and declining oil prices should boost private sector competitiveness. But economic reforms will be needed for India to achieve its full long-term growth potential, the report argued.

The report said the region’s economy will expand by a real 6 percent in 2015 and by 6.4 percent in 2016 compared to 5.4 percent this year, potentially making it the second fastest growing region in the world after East Asia and the Pacific, reports PTI.

10:00am Market Check

Equity benchmarks continued to trade lower with the Sensex falling 109.84 points to 26458.15 and the Nifty losing 35.70 points to 7909.85 weighed down by metals, banking and financials, FMCG and capital goods stocks.

About 1076 shares have advanced, 867 shares declined, and 94 shares are unchanged.

Harendra Kumar of Elara Capital has been worried about market’s valuations and levels.

On the back of IMF paper revising global GDP growth downwards, which is not far away from global recession and given that 45 percent of India’s economy is globally-linked, Kumar maintains a cautious stance for the market hereon.

He advises investors to accumulate on dips as 7,600 is likely to be the immediate target for the market.

Aluminium major Hindalco Industries topped the selling list, falling over 3 percent followed by HDFC and Cipla with 2-3 percent loss. ITC, HDFC Bank, Mahindra and Mahindra, Hero Motocorp, Gail India and BHEL lost 1-1.5 percent.

However, Tata Motors, TCS, Infosys, ICICI Bank, Reliance Industries, Axis Bank and NTPC bucked the trend, up 0.3-1 percent.

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