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Indian Indices Turn Volatile, Key Sectors Rebound, and Top Stocks in Action
Wed, 21 Mar Pre-Open

On Tuesday, share markets in India opened on a negative note but ended the day in green.

The BSE Sensex closed higher by 74 points to end the day just below the 34,000 mark at 32,996. While the broader NSE Nifty ended the day higher by 30 points to end at 10,124 levels.

Among BSE sectoral indices, IT stocks rose the most by 1.3%, followed by telecom stocks at 1.2%. Tata Steel and Sun Pharma were among the top gainers.

Top Stocks in Action Today

Godrej Agrovet share price is likely to be in focus today after reports that the mortgage company is planning to bid for Ruchi Soya Industries Ltd, which is undergoing bankruptcy resolution, with an eye on its palm oil business.

A bid would mark Godrej joining the race for Ruchi Soya, in which companies such as Patanjali Ayurved Ltd, ITC Ltd and Emami Ltd have evinced interest.

Canara Bank share price is among the stocks to watch today, after news that the Central Bureau of Investigation (CBI) has charged its former CMD and others with cheating and forgery in a loan default case.

As per the news, The CBI had registered a case on January 27, 2016, on the allegations that the company, dealing in wholesale and retail trading of silver jewellery and articles, etc. had cheated Canara Bank to the tune of Rs 683 million through its accounts at Kamla Nagar, New Delhi branch of the bank.

India's Manufacturing and IT Sectors Seen to Rebound

As per an article in a leading financial daily, the Reserve Bank of India's (RBI) data on performance of the private corporate sector has showed that India's manufacturing sector witnessed an improvement in sales growth in the period October-December 2017-18 (Q3) on annual basis.

However net profit has remained subdued due to lack of support from other/non-operating income. It noted that during Q3 of FY18, manufacturing companies' sales surged by 14% as compared to similar period of the previous fiscal. While net profit of these companies declined by 2.4%.

According to the data, the information technology (IT) sector also registered modest improvement in sales growth, although lower than in the previous year.

Further, the services (non-IT) sector showed signs of revival as reflected by positive sales growth.

Besides, it pointed out that among major manufacturing industries, demand conditions improved for chemical and chemical products; cement and cement products; machinery and machine tools; and motor vehicles and other transport equipment.

The data further stated that operating profits of the manufacturing sector were supported by improved demand conditions and continued to record a healthy growth, despite significant increase in input costs.

It also said that pricing power in terms of the net profit margin declined for the manufacturing sector, while it improved for the services (non-IT) sector.

IPO Buzz

State-owned Hindustan Aeronautics' initial public offer was subscribed 0.98 times as of 4 pm yesterday, according to data available with the stock exchanges.

The IPO, through which the Bengaluru-based firm aims to raise Rs 42.3 billion, received bids for 15.4 shares against the total issue size of 34.1 million shares.

The IPO for 34.1 million shares and closed yesterday. The price band for the issue was fixed at Rs 1215-1240. SBI Capital Markets and Axis Capital managed the issue.

To know our view on the HAL IPO, you can read our IPO note here.

Global Financial Markets Await Key Fed Meet Cues

Asian share markets are witnessing volatility ahead of US Federal Reserve's two-day monetary policy meeting starting today.

This is the first policy under new Fed chief Jerome Powell. The Federal Reserve is expected to hike US interest rates on Wednesday and perhaps signal that as many as three more lie in store for the rest of the year.

Note that the Fed has forecast three rate hikes this year.

In its last meeting, the Fed said it expects "further gradual" rate increases. The target range for the federal funds rate currently is 1.25% to 1.50%.

Note that with the US economy chugging along for many months, the Fed is now gradually easing off the stimulus it provides to the economy by raising interest rates to more normal levels.

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