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Sensex Ends at Record High Ahead of the Festive Season
Mon, 16 Oct Closing

Indian share markets hit record highs in today's trade after data showed the country's merchandise exports surged in September, pushing the trade deficit to a seven-month low. India's trade deficit narrowed to US$8.98 billion in September, from US$11.64 billion in August, as merchandise exports grew about 26% from a year ago.

At the closing bell, the BSE Sensex closed higher by 201 points and the NSE Nifty finished up by 63 points. The S&P BSE Mid Cap finished up by 0.5% while S&P BSE Small Cap finished up by 0.1%. Gains were largely seen in metal stocks, pharma stocks and auto stocks.

Asian stock markets finished mixed as of the most recent closing prices. The Hang Seng gained 0.76% and the Nikkei 225 rose 0.47%. The Shanghai Composite lost 0.36%. European markets are higher today with shares in Germany leading the region. The DAX is up 0.16% while France's CAC 40 is up 0.08% and London's FTSE 100 is up 0.06%.

Rupee was trading at Rs 64.76 against the US$ in the afternoon session. Oil prices were trading at US$ 52.16 at the time of writing.

TCS share price finished the trading day on an encouraging note (up 1.1%) after it was reported that TCS has teamed up with BNP Paribas Securities Services to deliver Corporate Event Connect, an innovative block-chain-based platform, which will provide fast, accurate and secure corporate event announcements to clients around the world.

By leveraging TCS' Quartz block-chain technology, BNP Paribas will be able to capture and store corporate action information in a structured format to ensure data accuracy and rapid dissemination to clients. The platform's built-in security will ensure the information is tamper-proof, resistant to node failure and recoverable.

In another development, HCL Technologies (HCL) has decided to discontinue its joint venture agreement with DXC Technology and formed a new IP partnership with the company.

Under the new partnership, HCL will be responsible for product development and modernisation, maintenance and professional services of core banking products. In July 2015, the company had partnered with DXC and had formed two joint venture entities - CeleritiFinTech (CFT) and CeleritiFinTech Services (CFTS).

HCL Tech share price finished the day up by 0.2% on the BSE.

The top 4 IT companies have underperformed the benchmark. With the sector, heavily dependent on US customers, Trump's protectionist policy announcements have further dampened the mood in this sector.

Underperformance of Top IT Stocks


Also, with automation on the horizon, Indian IT companies' low-cost labor outsourcing is turning into a thing of the past. IT companies need to re-invent itself.

Automation is needed in their traditional businesses like BPO, application management, and infrastructure management.

While near term challenges are there, current valuations of top IT companies are at multi-year lows. But is this the new normal? The challenge is to find the companies better placed than others to adapt to this structural change.

In news from the economy, days after the International Monetary Fund (IMF) pared India's GDP growth projection for the year 2017 and 2018, its Managing Director Christine Lagarde has expressed confidence that the series of reforms like demonetisation and Goods and Services Tax (GST) regime have put country's economy on a very solid track in the mid-term.

Describing these structural reforms as 'monumental effort', she said that it is hardly surprising that here is a little bit of a short-term slowdown as a result, but for the medium term, they see a very solid track ahead for the Indian economy.

IMF chief further indicated that metrics of inflation, fiscal deficit and structural reforms would deliver jobs. She also said that they hope that the combination of fiscal, because the deficit has been reduced, inflation has been down significantly, and the structural reforms will actually deliver the jobs that the Indian population, particularly the young Indian people expect in the future.

Last week, the IMF in its latest flagship World Economic Outlook has lowered India's Gross Domestic Product (GDP) growth forecast for 2017 by 0.5 percentage points to 6.7%, primarily because of the lingering impact of demonetisation as well as disruption caused by the GST regime.

It has also trimmed the growth projection for 2018 to 7.4% from 7.7% forecasted earlier in April and June.

In news from pharma sector, Glenmark Pharmaceuticals Inc., USA (Glenmark) has been granted final approval by the United States Food & Drug Administration (USFDA) for Aprepitant Capsules USP.

According to IMS Health sales data for the 12-month period ending August 2017, the Emend Capsules, 40 mg, 80 mg, and 125 mg market achieved annual sales of approximately US$64.9 million.

Glenmark's current portfolio consists of 127 products authorized for distribution in the US marketplace and 60 ANDA's pending approval with the USFDA. In addition to these internal filings, Glenmark continues to identify and explore external development partnerships to supplement and accelerate the growth of its existing pipeline and portfolio.

Glenmark Pharma share price finished the trading day up by 1.3% on the BSE.

Telecom stocks continued its good run with Idea share price and Bharti Airtel share price leading the gains.

Bharti Airtel and Millicom International Cellular S.A. (Millicom), through their respective subsidiaries, have concluded the deal to combine their operations in Ghana. Under the joint agreement, Airtel and Millicom will have equal ownership (50:50) and governance rights in the combined entity, which will have revenues of approximately US$300 million.

Both Airtel and Millicom will have Board representations and Management positions in the merged entity. The Ghana National Communications Authority granted approval for the merger proposal early this month.

The merged entity will become Ghana's second largest mobile operator with close to 10 million subscribers. The combined networks of the two companies will cover more than 80% of Ghana's population. It will also have one of the largest sales and distribution network to enhance customer convenience.

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