Weekly Update - Feb 02, 2013
Markets ended negative.
Markets closed down by over 1%, amid profit booking in Auto and Bank sectors after RBI at its policy meet struck a cautious note on further easing as it awaits governments plan to control the rising fiscal deficit and said that inflation continues to remain above its comfort zone. Sharp reduction in growth forecast by RBI for 2012-13 also aided weighed on market sentiment. Sensex closed down by 322 points or 1.6% at 19,871, while Nifty closed down by 76 points or 1.2% at 5,999.
Barring Pharma, FMCG and Consumer Durables sectors, profit booking was seen in all other sector with Capital Goods being the top loser, followed sectors were Oil & Gas, Auto, Power and Real-Estate. However, the Mid-cap index ended down 0.1%, while the Small-Cap index ended 1.2% lower.
Bharti Airtel closed down by 8.1%, after it's profit fell for the twelfth quarter in a row and missed estimates by a wide margin, dragged down by higher costs. The company saw its net profit fall to Rs 284 crore in the third quarter that ended December 31, from Rs 1,011 crore a year earlier.
Bharat Heavy Electricals ended down by 1.8% after reporting 18% year-on-year (yoy) drop in its net profit at Rs 1,182 crore for the third quarter ended December 31, 2012 (Q3) on account of lower operational income. The company's total order book position has declined to Rs 113,700 crore at the end of December 2012 quarter from Rs 122,300 crore as on September 2012 (Q2).
L&T ended down by 4.5% on profit taking after the stock rose post the announcement of its third quarter earnings last week on the back of encouraging order book position. The company said its order inflow grew 14% year-on-year (yoy) at Rs 19,545 crore during the October-December quarter (Q3).
State Bank of India closed down by 4.1% on profit taking after recent gains. The bank reduced its base rate by 5 basis points to 9.7% and the benchmark prime lending rate by 5 basis points to 14.45%. The bank has also lowered interest rates on home loans.
ICICI Bank ended marginally lower. Bank said its consolidated net profit for the quarter ended December 31, 2012 increased by 22% from a year earlier to Rs 2,645 crore on the back of improved financial performance of banking and life insurance businesses.
Tata Motors closed down by 5.3% on concerns over JLR sales. Last week, the company said that sales for JLR, which accounts for a majority of Tata Motors' profits, have slowed significantly over the past quarter. Meanwhile, the stock crashed over 10% in intra-day trade on Friday. The trades, which happened in the last 30 minutes of Friday’s trading on both the exchanges, were executed at prices below the market rates, resulting in both these stocks tumbling as much as 10% before trimming losses. An NSE official said the orders were within the exchange’s limits and came from a single broker. The official clarified these were not freak trades, but clarified the exchange would look into the matter.
Other losers in the financial space, HDFC Bank ended 4.7% lower, HDFC slipped 3.3% and ICICI Bank ended marginally lower after rising to Rs 1,200 levels.
Metal shares were also among the top losers during the week under review. Jindal Steel, Hindalco, Tata Steel, Sterlite Ind ended down 0.2-4% each.
Companies that will announce their third quarter earnings next week include, Bank of Baroda, Cipla, Tech Mahindra, ACC, Ambuja Cement, Hindalco Industries, M&M and Sun Pharma among others.
The RBI in its third quarter monetary policy review on Tuesday surprised the market by cutting short-term lending rate called repo by 0.25% to 7.75% and Cash Reserve Ratio (CRR) by similar margin to 4%, releasing Rs 18,000 crore primary liquidity into the system. The Reserve Bank of India lowered its growth projection as new investment demand continues to remain subdued. The banking regulator now expects the domestic gross domestic product (GDP) growth at 5.5% in the current financial year. It had earlier projected 6.5% growth in July, 2012. But lowered it to 5.8% three months later as investment demand slowed, consumption spending moderated and export performance eroded. Growth in Indian manufacturing slowed to a three-month low in January, as new export orders lost momentum, a business survey showed on Friday, underscoring the risks to India's economy from weak global demand, particularly in Europe.
Barring Pharma, FMCG and Consumer Durables sectors, profit booking was seen in all other sector with Capital Goods being the top loser, followed sectors were Oil & Gas, Auto, Power and Real-Estate. However, the Mid-cap index ended down 0.1%, while the Small-Cap index ended 1.2% lower.
Bharti Airtel closed down by 8.1%, after it's profit fell for the twelfth quarter in a row and missed estimates by a wide margin, dragged down by higher costs. The company saw its net profit fall to Rs 284 crore in the third quarter that ended December 31, from Rs 1,011 crore a year earlier.
Bharat Heavy Electricals ended down by 1.8% after reporting 18% year-on-year (yoy) drop in its net profit at Rs 1,182 crore for the third quarter ended December 31, 2012 (Q3) on account of lower operational income. The company's total order book position has declined to Rs 113,700 crore at the end of December 2012 quarter from Rs 122,300 crore as on September 2012 (Q2).
L&T ended down by 4.5% on profit taking after the stock rose post the announcement of its third quarter earnings last week on the back of encouraging order book position. The company said its order inflow grew 14% year-on-year (yoy) at Rs 19,545 crore during the October-December quarter (Q3).
State Bank of India closed down by 4.1% on profit taking after recent gains. The bank reduced its base rate by 5 basis points to 9.7% and the benchmark prime lending rate by 5 basis points to 14.45%. The bank has also lowered interest rates on home loans.
ICICI Bank ended marginally lower. Bank said its consolidated net profit for the quarter ended December 31, 2012 increased by 22% from a year earlier to Rs 2,645 crore on the back of improved financial performance of banking and life insurance businesses.
Tata Motors closed down by 5.3% on concerns over JLR sales. Last week, the company said that sales for JLR, which accounts for a majority of Tata Motors' profits, have slowed significantly over the past quarter. Meanwhile, the stock crashed over 10% in intra-day trade on Friday. The trades, which happened in the last 30 minutes of Friday’s trading on both the exchanges, were executed at prices below the market rates, resulting in both these stocks tumbling as much as 10% before trimming losses. An NSE official said the orders were within the exchange’s limits and came from a single broker. The official clarified these were not freak trades, but clarified the exchange would look into the matter.
Other losers in the financial space, HDFC Bank ended 4.7% lower, HDFC slipped 3.3% and ICICI Bank ended marginally lower after rising to Rs 1,200 levels.
Metal shares were also among the top losers during the week under review. Jindal Steel, Hindalco, Tata Steel, Sterlite Ind ended down 0.2-4% each.
Companies that will announce their third quarter earnings next week include, Bank of Baroda, Cipla, Tech Mahindra, ACC, Ambuja Cement, Hindalco Industries, M&M and Sun Pharma among others.
The RBI in its third quarter monetary policy review on Tuesday surprised the market by cutting short-term lending rate called repo by 0.25% to 7.75% and Cash Reserve Ratio (CRR) by similar margin to 4%, releasing Rs 18,000 crore primary liquidity into the system. The Reserve Bank of India lowered its growth projection as new investment demand continues to remain subdued. The banking regulator now expects the domestic gross domestic product (GDP) growth at 5.5% in the current financial year. It had earlier projected 6.5% growth in July, 2012. But lowered it to 5.8% three months later as investment demand slowed, consumption spending moderated and export performance eroded. Growth in Indian manufacturing slowed to a three-month low in January, as new export orders lost momentum, a business survey showed on Friday, underscoring the risks to India's economy from weak global demand, particularly in Europe.
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