Key equity benchmarks ended higher for third consecutive trading session, backed by firmness in banks and IT shares. The Nifty failed to close above 11,700 mark after briefly crossing that level in intraday trade. Gains were capped amid weakness in other Asian shares.
The Sensex rose 84.60 points or 0.22% to settle at 39,215.64, its highest closing level since 5 July 2019. The index rose 153.69 points, or 0.39% at the day's high of 39,284.73. The index fell 49.9 points, or 0.13% at the day's low of 39,081.14.
The Nifty 50 index rose 24.90 points or 0.21% to settle at 11,687.50, its highest closing level since 5 July 2019. The index rose 44.05 points, or 0.38% at the day's high of 11,706.65. The index fell 11.45 points, or 0.10% at the day's low of 11,651.15.
Broader market was negative. The S&P BSE Mid-Cap index fell 0.15%. The S&P BSE Small-Cap index fell 0.07%.
The market breadth was tilted in favour of sellers. On the BSE, 1123 shares rose and 1355 shares fell. A total of 172 shares were unchanged.
Among the sectoral indices on the BSE, the S&P BSE IT index (up 0.86%), the S&P BSE Teck index (up 0.77%) and the S&P BSE FMCG index (up 0.70%) outperformed the S&P BSE Sensex. Meanwhile, the S&P BSE Auto index (down 1.01%), the S&P BSE Utilities index (down 0.81%) and the S&P BSE Oil & Gas index (down 0.74%) underperformed the S&P BSE Sensex.
IT shares were mixed. Tech Mahindra (up 2.31%), HCL Technologies (up 2.06%), Infosys (up 1.19%), TCS (up 0.56%) and MindTree (up 0.35%), edged higher. Persistent Systems (down 0.41%), MphasiS (down 0.42%), Hexaware Technologies (down 0.61%) and Oracle Financial Services Software (down 0.88%), edged lower.
Wipro fell 0.13%. On a consolidated basis, Wipro's net profit fell 3.86% to Rs 2,387.60 crore on a 1.93% fall in net sales to Rs 14716.10 crore in Q1 June 2019 over Q4 March 2019. The result was announced after market hours today, 17 July 2019.
IT services segment revenue was $2,038.8 million in Q1 June 2019, an adjusted increase of 4.3% year-on-year (YoY). IT services operating margin for the quarter was at 18.4%, an increase of 0.8% YoY.
Wipro expects revenue from IT services business to be in the range of $2,039 million to $2,080 million. This translates to a sequential growth of 0.0% to 2.0%.
Tata Elxsi lost 8.90%. The company reported that the net profit declined 31.56% to Rs 48.79 crore on a 10.71% fall in net sales to Rs 361.71 crore in Q1 June 2019 over Q4 March 2018.
Most private sector banks advanced. RBL Bank (up 2.04%), Kotak Mahindra Bank (up 2.02%), IndusInd Bank (up 1.85%), City Union Bank (up 0.46%), HDFC Bank (up 0.40%) and ICICI Bank (up 0.04%), edged higher. Axis Bank (down 1.19%) and Federal Bank (down 4.01%), edged lower.
Yes Bank fell 5.25% to Rs 98.45 ahead of its Q1 result today, 17 July 2019.
DCB Bank dropped 16.39% to Rs 199.65. The bank's net profit rose 16.63% to Rs 81.06 crore on 20.43% rise in total income to Rs 944.46 crore in Q1 June 2019 over Q1 June 2018. The result was announced after market hours yesterday, 16 July 2019.
Most state-run banks declined. Allahabad Bank (down 1.92%), Syndicate Bank (down 1.01%), Central Bank of India (down 0.76%), Corporation Bank (down 0.75%), Andhra Bank (down 0.66%), Punjab National Bank (down 0.59%), Punjab & Sind Bank (down 0.39%), Bank of Maharashtra (down 0.32%), United Bank of India (down 0.2%) and Union Bank of India (down 0.19%), edged lower. Indian Bank (up 0.09%), IDBI Bank (up 0.57%), Canara Bank (up 1.28%), State Bank of India (up 2.17%) and Bank of Baroda (up 2.54%), edged higher.
A latest update from Finance Ministry noted that non performing assets (NPAs) have declined by Rs 1,06,032 crore to Rs 7,89,569 crore as on 31 March 2019. As per RBI data on global operations, aggregate gross advances of public sector banks (PSBs) increased from Rs 18,19,074 crore as on 31 March 2008 to Rs 52,15,920 crore as on 31 March 2014.
As per RBI inputs, the primary reasons for spurt in stressed assets have been observed to be aggressive lending practices, wilful default / loan frauds / corruption in some cases, and economic slowdown. Asset quality review (AQR) initiated in 2015 for clean and fully provisioned bank balance-sheets revealed high incidence of NPAs. As a result of AQR and subsequent transparent recognition by banks, stressed accounts were reclassified as NPAs and expected losses on stressed loans, not provided for earlier under flexibility given to restructured loans, were provided for.
Further, all such schemes for restructuring stressed loans were withdrawn. Primarily as a result of transparent recognition of stressed assets as NPAs, gross NPAs of PSBs, as per RBI data on global operations, rose from Rs 2,79,016 crore as on 31 March 2015, to Rs 8,95,601 crore as on 31 March 2018.
Multi Commodity Exchange of India (MCX) jumped 5.02%. The company's consolidated net profit surged 496.18% to Rs 43.70 crore on 29.87% rise in total income to Rs 110.95 crore in Q1 June 2019 over Q1 June 2018. The result was announced after market hours yesterday, 16 July 2019.
KNR Constructions jumped 5.13%. The firm said that it received a work order for Rs 847.34 crore from Navayuga Engineering Company, Hyderabad on back to back basis for the balance work of 'Palamuru Rangareddy Lift Irrigation Scheme - Package 10 for the formation of Venkatadri Reservoir bund. The announcement was announced was made after market hours yesterday, 16 July 2019.
Jay Bharat Maruti lost 6.19% after the company's consolidated net profit dropped 41.59% to Rs 7.85 crore on 12.45% fall in total income to Rs 443.21 crore in Q1 June 2019 over Q1 June 2018. The result was announced after market hours yesterday, 16 July 2019.
InterGlobe Aviation gained 1.44%. As per reports, the ministry of corporate affairs (MCA) has asked InterGlobe Aviation to respond to all charges of corporate mis-governance raised by Rakesh Gangwal, the company's promoter. The ministry is also scrutinizing the shareholder agreement between the two promoters, Rakesh Gangwal and Rahul Bhatia, verifying the agreement's compliance with the Companies Act.
Low cost airliner SpiceJet jumped 7.74%.
Suzlon Energy fell 4.50%. The company announced after market hours yesterday, 16 July 2019 that it has not made the payment of the principal amount of the outstanding Bonds, being $172 million, which was due on 16 July 2019 in accordance with the terms and conditions of the bonds. The company is working on holistic solution for its debt and continues to be in discussions with various stakeholders in relation to its outstanding debt (including the Bonds).
Larsen & Toubro Infotech fell 1.75%. The company announced during market hours today, 17 July 2019, that it has signed a definitive agreement to acquire Lymbyc Solutions, headquartered in Bangalore along with additional offices in Chennai and Texas, US. The acquisition is subject to customary closing conditions which are expected to get completed within 6 weeks. The cost of the said acquisition is Rs 380 million.
Larsen & Toubro fell 0.43%. The company announced during market hours today, 17 July 2019 that the water & effluent treatment business of L&T Construction and Tecton Engineering a Construction LLC, UAE joint venture have secured a prestigious contract for a 100 MLD Desalination plant from Gujarat Industrial Development Corporation, Gujarat, India. L&T Construction will be the lead in this project. The order falls in significant category with valuation between Rs 1000 to 2500 crore.
Vodafone Idea rose 1.44%. The company announced after market hours yesterday, 16 July 2019, that it has received a rating of 'BWR A+ (Outlook: Negative)' from 'BWR AA- (Outlook: Negative)' for non-convertible debentures from Brickwork Ratings.
Bharti Airtel fell 1.41%. The company announced after market hours yesterday, 16 July 2019, that it will consider Q1 June 2019 result on Thursday, 01 August 2019.
MTNL rose 1.08%. As per reports, group of ministers, led by Home Minister Amit Shah, yesterday discussed revival of loss making telecom firms BSNL and MTNL.
Cox & Kings hit 5% lower circuit at Rs 19. The company announced after market hours yesterday, 16 July 2019, that it had defaulted on its repayment obligation towards secured redeemable non convertible debentures worth Rs 50 crore. In a separate announcement yesterday, Cox & Kings said that it had also defaulted on its repayment obligation towards unsecured commercial paper worth Rs 45 crore.
Tata Power rose 1.55%. The company after market hours yesterday, 16 July 2019, announced a partnership with NTT Com- Netmagic to build its first 50 MW Solar Photovoltaic (PV) power plant in Solapur, Maharashtra, India. The capacity will be built in a phased manner with initial capacity of 35 MW increasing up to 50 MW within 24 months of initial commissioning of the plant.
Titan Company fell 0.48% to Rs 1109.55 after a global brokerage firm reportedly downgraded its rating on the stock from buy to neutral, as it cut the price target for the stock to Rs 1165 from 1200, citing weak jewellery demand in near term.
The yield on India's 10-year benchmark federal paper rose to 6.355% at 16:52 IST compared with 6.331% at close in the previous trading session. India's sovereign bonds have rallied recently after the government trimmed FY20 fiscal deficit target to 3.3% from 3.4% estimated earlier. The government also proposed to raise a part of its gross borrowing overseas. Besides broadening the bond market, this proposal could open up a new source of funding the budget deficit.
The RBI has cut rates three times this year amid a subdued inflation outlook and sluggish growth. Wholesale price-based inflation declined for the second consecutive month to its 23-month low of 2.02% in June, prompting experts to expect another rate cut by the RBI, which is slated to meet in the first week of next month.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 68.8675, compared with its close of 68.7150 during the previous trading session.
In the commodities market, Brent crude for September 2019 settlement rose 66 cents at $65.01 a barrel. The contract fell $2.13 or, 3.20% to settle at $64.35 a barrel in the previous trading session.
Overseas, shares in Europe were mixed while Asian stocks ended lower as comments from US President Donald Trump reignited trade war fears.
US stocks closed lower on Tuesday after President Donald Trump said an agreement with China on trade tariffs had a long way to go adding that America could place tariffs on an additional $325 billion worth of Chinese goods. Trump made his comments during a cabinet meeting at the White House. US and China have slapped tariffs on billions of dollars' worth of each other's imports since last year.
Federal Reserve chair Jerome Powell, while speaking in Paris at the Bank of France, said the economic outlook hasn't improved since the last Federal Open Markets Committee meeting in June, likely setting the stage for an interest rate cut.
Finance ministers from the Group of Seven (G-7) will meet in France today, with US-Sino trade tensions, France's digital tax and Facebook's Libra cryptocurrency expected to be on the agenda.
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