Falling Crude Oil Prices, Key Q3FY20 Results, and Top Cues in Focus Today

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On Monday, Indian share markets witnessed selling pressure throughout the day and ended deep in the red.

Benchmark indices fell sharply amid weakness in global equities as investors grew anxious about the economic impact of China's spreading virus outbreak.

The BSE Sensex closed lower by 458 points to end the day at 41,155. Tata Steel and IndusInd Bank were among the top losers.

While the broader NSE Nifty ended down by 129 points to end at 12,119.

Among BSE sectoral indices, metal stocks fell the most, followed by telecom stocks and power stocks.

Speaking of the Indian share markets, earnings and upcoming budget would play a critical role in shaping the investment trend.

In the below video, Tanushree Banerjee tells how you should react to the biggest economic event of the year- the Union Budget.

Watch Now...

Top Stocks in Action Today

Force Motors share price will be in focus today as the company is planning to raise Rs 6 billion in fresh investment to develop two new models over the next two years.

The proposed new models in the shared mobility space will come out from its soon-to-be-launched premium platform, code-named T1N, an export-focused premium van developed with an investment of Rs 10 billion and is getting ready for commercial production by the end of the year.

VST Tillers Tractors share price will also be in focus as it has entered into a Memorandum of Understanding (MoU) with Zetor Tractors a.s., Czech Republic for exploring the joint product development of tractors with horsepower of greater than 36 HP (products).

Market participants will also track Cummins India share price, Mastek share price, and Maruti Suzuki share price as these companies will announce their December quarter results later today.

Results Corner

ICICI Bank has reported around 3-fold jump in its net profit at Rs 41.5 billion for the December quarter (Q3FY20) as compared to Rs 16 billion for the same quarter in the previous year.

Total income of the company increased by 17.2% at Rs 236.4 billion for Q3FY20 as compared to Rs 201.6 billion for the corresponding quarter previous year.

To know more, you can read ICICI Bank's latest result analysis on our website.

DCB Bank has reported 12.3% rise in its net profit at Rs 967 million for the quarter under review as compared to Rs 861 million for the same quarter in the previous year.

To know more, you can read DCB Bank's Q3FY20 result analysis on our website.

APL Apollo Tubes has reported a strong performance in the December quarter. The company's net profit zoomed over 6-fold to Rs 832 million from Rs 129 million in the year-ago quarter.

The company's net revenues rose 25% year-on-year (YoY) to Rs 21.2 billion on the back of strong volume growth. Sales volume increased 52% YoY to 4.80 lakh tons from 3.14 lakh tons.

Earnings before interest, tax, depreciation and amortisation (EBITDA) more than doubled to Rs 1.7 billion compared to Rs 0.6 billion in the previous year's quarter. EBITDA per ton stood at Rs 3,440/ton against Rs 1,981/ton in corresponding quarter of previous fiscal.

Gold Prices Extend Gains

Gold prices in India edged higher on Monday, lifted by higher global rates. February gold futures rose 0.2% to end at Rs 40,355, extending gains to the third day.

Tracking gold, silver prices also edged higher. Silver futures gained 0.8% to Rs 47,291 per kg.

In global markets, gold rates rose 0.6% to US$ 1,586 an ounce as concerns over the spread of coronavirus in China spurred investors to buy the safe-haven metal.

China's health authorities on Sunday said coronavirus transmission ability is getting stronger as the death toll reached 80 and the number of infected rose over 2,000.

The US Centers for Disease Control and Prevention confirmed a second US case of the coronavirus in the country, denting appetite for riskier assets.

Gold dealers are now awaiting the budget, which will be presented on February 1. In last year's budget, the government had raised import tax on gold to 12.5% from 10% earlier.

According to reports, the commerce ministry has sought a reduction in gold import duty to boost the jewellery sector.

Speaking of gold, how lucrative has gold been as a long-term investment in India?

The chart below shows the annual returns on gold over the last 15 years...

Gold Has Been a Shining Long-Term Investment

As you can see, barring just two years - 2013 and 2015, gold has delivered positive returns in 13 of the last 15 years.

Here's what Ankit Shah, the editor of daily premium newsletter Equitymaster Insider (requires subscription) wrote about this in one of the editions of The 5 Minute WrapUp...

• "In fact, gold has delivered double-digit gains in 10 of the last 15 years.
  
  During the entire 15-year period, gold has shot up 555% (compounded annual return of 12.1%).
  
  During the same period, the Sensex surged 511% (compounded annual return of 12.0%). If you include dividends, the Sensex returns would be higher than gold by a couple of percentage points.
  
  One must note that the Sensex returns are not representative of the broader market returns. Moreover, gold was a no-brainer. You didn't have to study financial statements, business models and forecast future earnings growth to get a double-digit return on your investment."

Global Stock Market Updates

Global stock markets fell to their lowest in two weeks on Monday as worries grew about the economic impact of China's spreading coronavirus with demand spiking for safe-haven assets such as Japanese yen and Treasury notes.

Japan's Nikkei slid 2%, the biggest one-day fall in five months. Many markets in Asia were closed for the lunar new year holiday. US S&P 500 mini futures were down 0.9%, after falling 1.3% in early trade.

In Europe, stock markets slumped at the start of trading, tracking their counterparts in Asia. The pan-European STOXX 600 index fell 1.4% to its lowest level since Jan. 14.

On the commodities front, crude oil prices extended declines on Monday, dropping below US$ 60 for the first time in nearly three months.

Saudi Arabia's Energy Minister Prince Abdulaziz bin Salman Al-Saud said on Monday that OPEC and allied global producers led by Russia can help to balance the oil markets in response to any demand changes.

We will keep you updated on the latest developments from this space. Stay tuned.

As per the economic schedule released by Vijay Bhambwani, editor of Weekly Cash Alerts, here are the important events due later today:

• Russia - Unemployment & Retail Sales December
• Australia - Business Confidence December
• USA - Durable Goods Orders December

To know what's moving the Indian stock markets today, check out the most recent share market updates here.

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

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