US stocks hit record levels on Thursday after President Donald Trump tweeted that the United States was "very close" to a trade deal with China and on a report that U.S. trade negotiators had offered to cancel a fresh round of tariffs on Chinese goods.
The three main indexes opened lower but quickly gained ground after Trump's statement, which comes just days before the tariffs go into effect on Dec. 15.
At over 5.5% retail inflation is clearly much ahead of our expectations. But this is again due to the non-core part, mainly vegetables. Core inflation remains benign and trending downwards. The IIP number, although negative, is better than expected given that in October there are several holidays when factories were shut. This reflects a reasonably good festive sales and perhaps clearing of inventories. While the large part of food inflation is likely to soften over the next two months, we expect the trend inflation to remain elevated. Average inflation in 2020 at 4-4.5% range would be much higher than in 2019. With the likely bottoming of growth and elevated inflation as well as concerns on large fiscal slippages, the policy rate may remain in hold in FY20
The inflation rate at 5.54 per cent is heading towards the upper limit set by RBI at 6 per cent. However, this surge in inflation was expected with the skyrocketing prices in vegetables, as food and beverages has a share of around 45 per cent in Consumer Price Index (CPI). The worrying fact is the low core inflation rate that is not showing any signs of improvement at 3.5 per cent. It reflects the tepid demand in the economy
- Deepthi Mary Mathew, Economist, Geojit Financial Services
IIP-CPI mix clearly signals that India is entering into a kind of 'Stagflationary' phase. This certainly vindicates the RBI's pause in rate cutting cycle
- Rupa Rege-Nitsure, Group Chief Economist, L&T Financial Services
The level that IIP has reached is clearly unacceptable. It is the symptom not of a cyclical adjustment or a shock, but that of a fundamental weakening on the supply side of the economy. That the crisis has spread from the demand to the supply side is regrettable, largely because it was avoidable. Simply had aggressive rate cuts been carried out while there was still plenty of time, this situation would not have occurred. It is still not too late, though it is the eleventh hour, and we urge a very strong rate easing regime be implemented forthwith in order to still rescue the growth story
While the CPI food inflation rose to an uncomfortably high 10% in November 2019, a moderation in vegetable prices should douse food inflation to a large extent in early 2020. The sharp uptick in the headline CPI inflation in November 2019 justifies the pause undertaken by the prescient Monetary Policy Committee (MPC) in its last policy review. We expect the CPI inflation to spike further to 5.8%-6.0% in December 2019, close to the upper threshold of the MPC's medium-term target, driven by the recent revision in telecom tariffs. As a result, we expect the MPC to remain on hold in its February 2020 policy review
- Aditi Nayar, Principal Economist, ICRA
Will FII inflows continue to remain strong?
Going into Friday's trade, behavior of Nifty against 20-DMA would be crucial. The index will have to move past the 20-DMA and sustain above that on a closing basis if it has to make an attempt to move higher. If this is not happening and if it declines, we are potentially moving towards making a small head and shoulder pattern. This pattern is currently forming and it will form if Nifty starts its decline from present levels
- Milan Vaishnav, Founder, Gemstone Equity Research & Advisory Services
Albeit intraday profit booking from the intraday high resulted in a slightly longer shadow, which is dominating the candle body, that itself can’t be construed as a weak sign. Nifty closed above its near-term hurdle at the 13-day exponential moving average at 11,963 with a gapup on a favourable advance-decline ratio
Nifty managed to hold the opening gap and formed a bullish candle on the daily chart. The momentum oscillator Relative Strength Index (RSI) also turned bullish and was on the verge of giving a positive crossover with its average. Going forward, till Nifty holds above 11,900, we may see the continuation of rally towards 12,035 and 12,100 levels. On the flipside, strong support remained at 11,900 and then 11,800
Bulls were active in the trade and pushed the index higher towards the resistance zone. If bulls manage to push Nifty beyond 12,050 and close above it, the current consolidation is likely to end. Till the mentioned zone is not breached on the upside, index continues to remain in consolidation phase between 11,700-12,000 zone. Market breadth was strong as participation was wider. Overall broader uptrend remains intact. Support: 11,800-11,700 & Resistance: 12,020-12,100
- Manav Chopra, Head Research - Equity, Indiabulls Ventures
Markets will react to the macroeconomic data viz. CPI inflation and IIP numbers in the early trade on Friday. Besides, the outcome of the Britain election will also be on their radar. Since the signals are mixed from the benchmark indices, we advise continuing with stock-specific trading approach. We feel banking index can outshine the Nifty in the near future so plan your trades accordingly
- Ajit Mishra, VP - Research, Religare Broking
Since there was a huge subscription (in Ujjivan SFB), the listing was very premium, but I felt the stock got a little overvalued. That is why because some amount of profit booking was seen, but it is not a stock that one should exit. One would rather recommend a lower level, but obviously at a fair valuation, which comes close to Rs 52-55, where the stock should settle going ahead
- Siddharth Purohit, Equity research analyst, SMC Global Securities
Fed’s dovish stance on future rates trajectory and strengthening rupee brings cheer to investors. Global sentiment is likely to turn positive in expectations of delay in US tariff deadline, while expecting more positive developments from US-China trade talks. Metals & banks outperformed while IT index slid due to strong rupee and signs of change in risk appetite. On the other hand, November CPI inflation is likely to rise to 5.3% while Oct IIP may slide to -5%, which may have some impact on the direction
- Vinod Nair, Head of Research at Geojit Financial Services
CLOSING BELL: Sensex rises 169 pts on gains in bank, auto stocks; Nifty tops 11,950; PCJ jumps 12%, YES Bank 6%
We are expecting further moderation in GDP growth rate to 4.3 per cent in the current quarter. In 2020, we expect 5.5 per cent growth rate against 4.9 per cent in 2019. Given India’s potential growth of 6.5 percent, that is a significant negative output gap.
- Sonal Varma, Chief Economist, India and Asia ex-Japan at Nomura
National Fertilizers, 2 others list commercial papers on BSE
As many as three companies --- National Fertilizers, Chennai Petrochemicals Corporation and GIC Housing Finance -- listed their commercial papers on the BSE on Thursday.
With this, a total seven companies have listed their commercial papers (CPs) on the BSE since the stock exchange came out with the framework for listing of such instruments late last month.
Global oil inventories could rise sharply despite an agreement by OPEC and its allies to deepen output cuts as well as lower expected production by the US and other non-OPEC countries, the International Energy Agency (IEA) said on Thursday.
Shares of YES Bank rebounded on Thursday after falling 32 per cent in the past five trading sessions.
There are a number of reports on the private lender doing the rounds on Dalal Street.
Saudi Aramco tops $2 trillion, defying valuation sceptics
Saudi Aramco achieved the $2 trillion valuation sought by Saudi leader Crown Prince Mohammed bin Salman on Thursday as the newly-listed state-owned oil company's shares rose sharply on their second day of trading.
The Saudi Crown Prince has made the Aramco initial public listing (IPO) the centrepiece of his plan to diversify the Kingdom's economy away from its dependence on oil production by using the $25.6 billion raised to develop other sectors.
FY20 fiscal deficit would easily slip to 3.8%: Indranil Sen Gupta
MTNL shares rise as it seeks shareholder nod for fundraising, monetisation of assets
Price as on 12 Dec, 2019 01:30 PM, Click on company names for their live prices.
L&T bags Rail Vikas Nigam order worth Rs 1,000-2,500 crore
Larsen & Toubro to has bagged an order in the range of Rs 1,000 crore- Rs 2,500 crore from Rail Vikas Nigam, the engineering major said Thursday. The order entails construction of Rishikesh – Karanprayag Tunnel 2 package works comprising tunnels, bridges and formation works in the state of Uttarakhand. L&T's heavy civil infrastructure division will execute this order.
India's first corporate bond exchange-traded fund (ETF) -- Bharat Bond ETF -- opened for subscription on Thursday. The ETF is a government initiative and Edelweiss AMC has the mandate to design and manage the product. Edelweiss AMC proposes to raise an initial amount of Rs 3,000 crore with a green-shoe option of Rs 2,000 crore in the three-year maturity period and Rs 4,000 crore with a green-shoe option of Rs 6,000 crore in the 10-year maturity bucket.
Saudi Aramco set to hit $2 trillion market value on Thursday
Saudi Aramco’s share price jumped 10% for the second consecutive day, hitting 38.7 riyals ($10.32) in a pre-market auction, Refinitiv data showed, suggesting the company will hit a $2 trillion market value when it starts trading on Thursday.
Geographically, there are developed markets, developing markets. Money is looking for an opportunity. The ideal target is a good company bought at reasonably correct valuations and a reasonable timeframe, which has to be as early as possible. Now if that does not happen, then you start moving on to the next set of stocks which is where you say that okay demand is not there and growth will not come in the immediate term but the valuation is there and I am willing to extend my horizon of return. I think that is where part of the money is going into real estate stocks.
- Kunj Bansal, Sarthi Group
ADAG group stocks tank 5%
Price as on 12 Dec, 2019 11:15 AM, Click on company names for their live prices.
PNB drops 2% as firms discloses Rs 456 crore exposure to Omaxe
Shares of PNB Housing Finance were trading 2% lower in Thursday's session after the firm on Wednesday said its exposure to the Omaxe group stood at over Rs 456 crore at the end of September. There were rumours that the real estate firm has defaulted on its loan repayment.
What is more important is the impact it could have on the holding company and our broad ballpark calculation suggests that the fair value of Ujjivan would be somewhere in the range of about 350-360 basis listing of about Rs 50 for Ujjivan Small Finance Bank.
- Hemang Jani on Ujjivan SFB listing
16 stocks hit 52-week highs on NSE
Around 16 stocks rose to touch their 52-week highs on NSE in Thursday's session. Among the stocks that touched their 52-week highs were Aavas Financiers, Agro Phos, Cura Technologies, Divi's Laboratories, DLF, Kotak Mahindra Bank, SRF and Uttam Value Steels.
Top buys & sells by MFs in November
Ujjivan SFB, YES Bank, Voda Idea among most active stocks on NSE
Price as on 12 Dec, 2019 10:12 AM, Click on company names for their live prices.
Indices reflect financial performance of India Inc, not GDP: Mukesh Agarwal
Shares of Ujjivan Small Finance Bank made a robust stock market debut on Thursday as the stock got listed at Rs 58 on the BSE, marking a 56.76 per cent premium over its issue price of Rs 37 per share. The scrip listed at Rs 58.75 on the NSE, a premium of 58.78 per cent over the issue price.
Pre-open session: Sensex jumps 160 points, Nifty nears 11,950; rupee trades at 70.69 against USD
Singapore trading sets stage for positive start
Nifty futures on the Singapore Exchange traded 47.50 points, or 0.40 per cent, up at 11,996.50, indicating a positive start for Dalal Street.
Tech view: Nifty forms bullish candle
Nifty closed 53.35 points higher at 11,910.15, after hitting an intraday high and low of 11,923.20 and 11,832.30, respectively. Rohit Singre, Senior Technical Analyst at LKP Securities said, “The index reversed from its strong support zone of 11,850-11,800, hinting same levels will act as immediate support in the next session, while resistance is coming near 11,950-12,000 zone.”
Asian shares gain
Asian stocks edged higher on Thursday after the Federal Reserve signalled rate settings were likely to remain accommodative but the imminent UK election and a deadline for Sino-US trade talks kept investors cautious. That helped MSCI's broadest index of Asia-Pacific shares outside Japan to rise 0.2 per cent. Japan's Nikkei stock index climbed 0.11 per cent and US stock futures rose 0.06 per cent. Australian shares were down 0.29 per cent, however, weighed by the energy sector after the fall in oil prices.
US stocks close higher
Wall Street's main stock indexes ended modestly higher on Wednesday after the U.S. Federal Reserve held interest rates steady and signaled that borrowing costs are likely to remain unchanged indefinitely. The Dow Jones Industrial Average rose 29.37 points, or 0.11%, to 27,911.09, the S&P 500 gained 9.1 points, or 0.29%, to 3,141.62, and the Nasdaq Composite added 37.87 points, or 0.44%, to 8,654.05.
FIIs buy Rs 605 crore worth stocks
Net-net, foreign portfolio investors (FPIs) were buyers of domestic stocks to the tune of Rs 605.41 crore on Wednesday, data available with NSE suggested. DIIs were net buyers to the tune of Rs 239.87 crore, data suggests.
Crude prices stable
Oil prices steadied on Thursday with the market mood switching to relief as OPEC forecast a supply deficit next year, from doom and gloom over data showing a surprise increase in US crude inventories. Brent futures rose 19 cents, or 0.3 per cent to 63.61 a barrel by 0100 GMT, after skidding 1 per cent on Wednesday on the US stocks build-up.