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Nifty ends flat; WPI at 5-year low, rupee slips; HDFC up 5%


The News International Team

It was a consolidation day as the market closed the first day of the week on a flat note despite sharp fall in November WPI inflation and weak rupee. The Sensex lost more than 200 points and the Nifty broke 8200 level in opening trade following decline in Asian and US peers post further fall in crude oil prices, but indices managed to recoup all those losses immediately.

The Sensex declined 31.12 points to close at 27319.56 and the Nifty slipped 4.50 points to 8219.60. The broader markets underperformed benchmarks with the BSE Midcap and Smallcap indices lost 0.5 percent and 0.6 percent, respectively.

Sanjeev Prasad of Kotak Institutional Equities says one should not get perturbed by market fall. Use every dip to buy this market, he advises.

Globally, Asian markets (barring Shanghai) closed in the red reacting to the weak US cues, continuing slide in oil prices and decline in manufacturing sentiment in Japan. Japan was also in focus on account of Prime Minister Shinzo Abe winning the snap election over the weekend. However, European markets like CAC, DAX and FTSE were up 0.7 percent each (at 16 hours IST).

Brent crude bounced back from the fresh 5.5-year lows of USD 60.28 a barrel in the earlier session, up 84 cents or 1.36 percent to USD 60.69 a barrel (at 16 hours IST). Oil prices had fallen after the International Energy Agency on last Friday estimated further price falls and OPEC chief defended the group’s decision on not to cut its output.

Back home, hopes of a rate cut increased as November WPI fell to zero, a five-year low, down from its October level of 1.77 percent led by a drop in fuel prices. Fuel inflation went down 4.9 percent reflecting the sharp plunge in global crude prices.

The rupee weakened to a fresh ten-month low of 62.88 a dollar (down 59 paise) on the back of large corporate dollar demand.

TCS was reeling under selling pressure, down 3.8 percent post bearish Q3 outlook. In its analyst meet on Friday, the software services provider says it expects a weak quarter from BFSI and sees negative 220 basis points impact on revenues due to cross currency. Infosys slipped 0.77 percent and Wipro lost 0.4 percent.

Tata Motors lost over a percent after its November JLR wholesale numbers were muted with the total JLR sales coming in higher by only 3 percent at 41318 on a year-on-year basis.

Shares of Axis Bank, Sesa Sterlite and Cipla declined 1-2 percent followed by ITC, Reliance Industries, Larsen & Toubro, HUL, ICICI Bank and ICICI Bank were down 0.3-0.8 percent.

However, Housing finance company HDFC topped the buying list in the Sensex, up 5 percent. A media report suggested that Standard Life is planning to increase its stake in joint venture HDFC Standard Life Insurance company to 33 percent from 26 percent. HDFC holds 72.4 percent in JV.

Private sector lender Kotak Mahindra Bank too climbed 5 percent and ING Vysya Bank gained 3.7 percent as ING will seek shareholders’ approval for the merger of the bank with Kotak Mahindra in next month.

State-run oil explorer ONGC rose 1.8 percent and coal mining company Coal India jumped 3.3 percent on reports of deferral of divestment in these two companies by the government.

HDFC Bank gained 1 percent.

Bharti Airtel was up 0.7 percent as the telecom operator, through its subsidiary is going to sell and lease back over 1100 towers in Zambia and Rwanda to African company IHS, under a 10-year renewable contract.

In the broader space, Mastek was locked at 20 percent upper circuit as insurance subsidiary Majesco announced plans to merge Cover-All Technologies with itself in a 100 percent stock-for-stock transaction and plans to list Majesco on the NYSE, subject to regulatory and shareholder approvals.

Adani Ports gained 3.8 percent as brokerage CLSA initiated coverage with buy on the stock and a target price of Rs 375. On a 4-year view, the stock could double, the brokerage says in its note to clients.

Career Point surged 20 percent as Reserve Bank of India granted certificate of registration to Srajan Capital (a wholly owned subsidiary company) to commence business of non banking financial institution.

Spicejet fell nearly 8 percent as today i.e. December 15 was the deadline for the company to submit a financial turnaround plan to the Directorate General of Civil Aviation.

About 1178 shares advanced while 1724 shares declined on the Bombay Stock Exchange.


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