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Markets will remain closed on 18th October, 2018 on account of Dussehra.

Sensex Ends Day in Red; IT Stocks Rally
Wed, 25 Apr Closing | Parth Parekh, TM Team

After opening the day in red, share markets in India witnessed volatile trading activity throughout the day and ended the day in red. Sectoral indices were mixed, with stocks in the IT sector and stocks in the telecom sector leading the gains.

At the closing bell, the BSE Sensex stood lower by 115 points (down 0.3%) and the NSE Nifty closed down by 44 points (down 0.4%). The BSE Mid Cap index ended the day down 0.5%, while the BSE Small Cap index ended the day down by 0.7%.

Asian stock markets finished in red. As of the most recent closing prices, the Hang Seng was down by 1% and the Shanghai Composite was down by 0.4%. The Nikkei 225 was down by 0.3%. Meanwhile, European markets too were trading in red. The FTSE 100 was down by 0.7%, The DAX, was down by 1.5% while the CAC 40 was up by 0.6%.

The rupee was trading at Rs 66.78 against the US$ in the afternoon session. Oil prices were trading at US$ 67.15 at the time of writing.

Bharti Airtel share price was in focus today after it approved merger of its listed tower arm with privately held Indus Towers Ltd. to create the largest telecom infrastructure company outside China.

Bharti Infratel currently owns 42% equity interest in Indus Towers, which has a portfolio of 1,22,920 towers as of June 2017.

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The combined entity between Bharti Infratel Ltd. and Indus Towers will have more than a third of the market with 163,000 towers.

Bharti Airtel, India's largest telecom operator, and Vodafone India Ltd. own 42 percent each in Indus Towers, while Idea Cellular Ltd. holds 11.15 percent. The remaining 4.85 percent is held by U.S.-based private equity firm Providence.

The proposed merger will unlock value for the telecom incumbents in India.

The entry of Reliance Jio and the fierce tariff war it has triggered has set off brisk activity in the telecom industry for fundraising and consolidation, as the incumbents look for ways and means to fend off the competition.

Telecom Sector: A decade of Underperformance

Note that the whole telecom business has been an underwhelming story so far. While the telecom subscriber base has increased from 300 million in 2008 to 1.2 billion in 2017, investors have little to cheer. The BSE Sensex has gone up 3.25 times in nine years, but the BSE Telecom Index has not moved an inch from its levels of 2008.

Telecom companies are straddled with high debt, intense competition, and lack of pricing power. High spectrum costs and regulatory issues have hampered the sector. While consumers have benefited from low costs and new players fighting for their share, investors have suffered.

With the entry of Reliance Jio, the competition has intensified further. Reliance Jio's low cost offerings and strategy of capturing market share will further dent the sector. The sector has been a classic 'value trap'. While it always looks cheap compared to other sectors, it has failed to provide any reasonable returns. We also believe the situation is unlikely to change in the near future. For an investor, it's important to differentiate between 'value' and 'value traps'.

Moving on to news from stocks in the automobile sector. Tata Motors share price was in focus today after its erstwhile partner Volkswagen AG signalled it isn't shutting the door on a tie-up with the Indian automaker.

Volkswagen said that it is working on a strategy to bring budget cars to millions of cost-conscious buyers in the South Asian country, and a collaboration with the owner of Jaguar Land Rover is possible.

The planned tie-up with Tata announced last year was aimed at achieving cost savings and technical synergies but was scrapped in five months. At the time, they said they could revive cooperation efforts in the future if the conditions arise.

In March last year, the two companies signed a memorandum of understanding at the Geneva Motorshow to explore various options, including a partnership for the development of Tata's new advanced modular platform (AMP), a joint venture or a contract manufacturing agreement, in a bid to achieve economies of scale that would have helped to cut costs.

In August last year, the companies said that they have performed a technical feasibility and commercial evaluation of a potential collaboration and jointly concluded that the envisioned areas of partnership may not yield the desired synergies as originally assessed.

However, both the companies had said they would keep the door open for future collaborations and partnerships.

Tata Motors share price ended the day down by 0.9%.

And here's a note from Profit Hunter:

Bharti Airtel is the top gainer in the Nifty 50 Index. The company announced its quaterly results yesterday after the market hours and today, the stock is up 3.5%.

The stock touched a life-time high of 565 in November 2017 and slipped lower to trade in a downtrend. It traded in a falling channel line from February 2018.

It touched a low of 375 a few days back. It bounced up from this low after finding support from the horizontal support line. The stock also found support from the channel's support line.

Today, the stock broke above the channel's resistance line with strong volumes. The RSI indicator also formed a bullish divergence with the price.

So will the stock challenge the life-time high or it is just a bounce before it resumes its downtrend. Let's wait and watch...

Bharti Airtel Broke Channel's Resistance
Bharti Airtel Broke Channel's Resistance 

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Stock Market Updates

TORRENT POWER LTD Plunges by 5%; BSE POWER Index Down 1.1% (Today's Market)

Oct 17, 2018 03:34 PM

TORRENT POWER LTD share price has plunged by 5% and its current market price is Rs 250. The BSE POWER is down by 1.1%. The top gainers in the BSE POWER Index is POWER GRID (up 0.7%). The top losers are TORRENT POWER LTD (down 5.1%) and SUZLON ENERGY (down 6.2%).

ADANI PORTS & SEZ Plunges by 5%; BSE 500 Index Down 1.6% (Today's Market)

Oct 17, 2018 03:34 PM

ADANI PORTS & SEZ share price has plunged by 5% and its current market price is Rs 340. The BSE 500 is down by 1.6%. The top gainers in the BSE 500 Index are NIIT TECHNOLOGIES (up 5.1%) and MOIL LTD (up 4.8%). The top losers are ADANI PORTS & SEZ (down 5.1%) and HEG LTD (down 6.4%).

INOX WIND Plunges by 6%; BSE CAPITAL GOODS Index Down 1.6% (Today's Market)

Oct 17, 2018 03:34 PM

INOX WIND share price has plunged by 6% and its current market price is Rs 97. The BSE CAPITAL GOODS is down by 1.6%. The top gainers in the BSE CAPITAL GOODS Index are LAKSHMI MACHINE (up 1.9%) and GRAPHITE INDIA (up 1.8%). The top losers are INOX WIND (down 6.3%) and BEML LTD. (down 7.2%).

The BSE METAL Index Down 2% ; JINDAL STEEL & POWER Among Top Losers (Today's Market)

Oct 17, 2018 03:34 PM

The BSE METAL Index Down at 13,222 (down 2.1%). Among the top losers in the BSE METAL Index today are JINDAL STEEL & POWER, TATA STEEL and JSW STEEL. Meanwhile, the BSE Sensex has plunged 1.1% to 35,605.

MAHINDRA HOLIDAYS Plunges by 6%; BSE 500 Index Down 1.6% (Today's Market)

Oct 17, 2018 03:32 PM

MAHINDRA HOLIDAYS share price has plunged by 6% and its current market price is Rs 212. The BSE 500 is down by 1.6%. The top gainers in the BSE 500 Index are NIIT TECHNOLOGIES (up 4.9%) and PHOENIX MILL (up 4.3%). The top losers are MAHINDRA HOLIDAYS (down 5.6%) and HEG LTD (down 6.2%).

Sensex Trades on a Volatile Note; Auto, Realty Stocks Drag (Today's Market)

Oct 17, 2018 12:30 pm

The BSE Sensex is trading up by 70 points, while the NSE Nifty is trading up by 4 points.

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