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Defence stocks soar, banks rally; Sensex, Nifty sluggish


The News International Team

1:50 pm Buzzing: Shares of Kansai Nerolac gained as much as 4 percent intraday on reporting a whopping 40.6 percent growth in the second quarter bottomline. Net profit of the paint company jumped to Rs 72.6 crore in the quarter ended September 2014 compared to Rs 51.7 crore in the year-ago period and net sales increased 17.2 percent year-on-year to Rs 915.2 crore from Rs 781 crore during the same period. Operating profit (including other operating income) climbed 31.3 percent on yearly basis to Rs 120.4 crore and margin expanded by 140 basis points to 13.2 percent in the quarter gone by.

1:30 pm FII interview: In an interview to CNBC-TV18 Adrian Mowat, Chief Asian & Emerging Equity Strategist, JPMorgan shared his views and outlook on the global equity markets. He said the key focus of the markets will be on the US Federal Reserve meeting this week, where the Fed might announce a closure of QE3. Mowat expects Fed to maintain low interest rates for a considerable period of time. “We will watch for words “considerable time” from the Fed regarding rate moves,” he added. Speaking about emerging markets, he said JPMorgan is looking to pump more funds into India .

The research firm has downgraded Brazil to neutral and recommends moving money from Brazil to markets like India. He expects 20 percent returns from the Indian equity market in next 12 months. Further he is betting on Indian banks and sees an attractive environment for interest rate-sensitive sectors. He prefers investing in cyclicals like autos and building materials.

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It seems to be a day of taking rest even after the long weekend as sluggish market refuse to budge ahead. The Sensex is up 6.08 points at 26857.13 and the Nifty is up 2.30 points at 8017.95. About 1177 shares have advanced, 1370 shares declined, and 98 shares are unchanged.

BHEL is up 4 percent while Dr Reddy’s Labs, Sesa Sterlite, GAIL and Coal India are top gainers in the Sensex.  Defence stocks are trading higher on the hope of additional orders after the centre gives nod to projects worth Rs 80,000 crore. Banks are also doing well.

Among the losers are Tata Motors, Hero MotoCorp, ONGC and Wipro.

HUL is weak ahead of its second quarter earnings later today. A CNBC-TV18 poll expects sales growth to remain muted across most categories with 5 percent year-on-year volume growth. Margins are likely to see an improvement of 90 basis points.

Dragged by DLF, realty index is down around 4 percent.

A recovery in Asia’s diesel demand growth is likely to be pushed back as governments of major oil consumers in the region take advantage of a tumble in oil prices to cut fuel subsidies and bolster their budgets.

A prolonged period of weak demand is expected to reduce margins for refineries that produce the transport and industrial fuel, traders and analysts said. The Asian gasoil margin is already set for its worst quarter in October-December since late 2010, according to Reuters data, hurt by slower economic growth and a supply glut from new refining capacity.


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