Tata Motors share price rallied 3.6 percent after Jaguar Land Rover’s March US sales increased 10.2 percent to 14,232 units compared to year-ago
The market caught in bear trap on Wednesday as benchmark indices lost more than 1 percent after the China unveiled new tariffs to counter US tariffs. Investors await the outcome of two-day Monetary Policy Committee meeting due Thursday.
Nearly Rs 1.2 lakh crore worth of investors’ wealth eroded due to today’s fall. All sectoral indices closed in the red barring Auto. Nifty Bank, IT, Metal, Pharma, PSU Bank, and Realty were down between 1-2.6 percent.
The market reversed some of gains seen in previous two consecutive sessions. The 30-share BSE Sensex ended down 351.56 points or 1.05 percent at 33,019.07 and the 50-share NSE Nifty fell 116.60 points or 1.14 percent to 10,128.40.
The volatility is likely to continue for few more sessions and this global trade war concerns continued to weigh on sentiment, experts suggest.
“Trade war will be definitely the single biggest trigger point at the moment for global markets. It’s quite crucial that trade tensions have to be diffused for markets to make sustained bullish recovery. From Indian stand point, upcoming results and political developments have also to be closely watched,” Jagannadham Thunuguntla, Sr. VP and Head of Research (Wealth), Centrum Broking said.
Even as the market has corrected around 10 percent from its high points, Vetri Subramaniam, Group President & Head-Equity at UTI AMC believes that valuations cannot yet be called cheap, but are not as expensive as they were some months ago.
He highlighted that though earnings have progressed well, one should continue to stay cautious. Last year, there were continuous cuts for FY18 estimates, which is not the case for FY19.
ICICIdirect said futures & options data suggested a key support for the Nifty at 10,100. A move below this level could open Nifty’s downside to high Put bases of 10,000 & 9,800 levels.
Meanwhile, China has announced new tariffs of 25 percent on 106 US products, including soy, cars, whisky and chemicals, impacting imports worth USD 50 billion. It said it will announce the effective date for the new tariffs at a later date.
European markets were trading lower, as elevated concerns of a tit-for-tat trade war between the world’s biggest economies overshadowed a bounce on Wall Street. Germany’s DAX was down 1.3 percent while France’s CAC and Britain’s FTSE were down around half a percent, at the time of writing this article.
Asian stocks closed mixed amid new China-US trade developments. Hang Seng slipped 2.2 percent and Kospi was down 1.4 percent. China’s Shanghai Composite fell 0.15 percent while Japan’s Nikkei gained 0.13 percent and Australia’s ASX 200 rose 0.17 percent.
Oil prices slipped on expectations for a build-up in US crude inventories. US WTI crude futures were at USD 62.40 a barrel, down 1.75 percent and Brent crude futures dipped to USD 67.01 per barrel, down 1.63 percent.
Back home, Tata Motors share price rallied 3.6 percent after Jaguar Land Rover’s March US sales increased 10.2 percent to 14,232 units compared to year-ago.
Eicher Motors was up 3.4 percent after the company raised its guidance for Royal Enfield for FY19 to 9.50 lakh from 9 lakh units, which is 3 percent higher than out current sales estimate of 9.24 lakh units.
Morgan Stanley believes this increase in FY19 capacity indicates confidence for Royal Enfield bikes’ demands and reiterated overweight rating on the stock with a target price at Rs 34,104 per share.
HDFC Bank, L&T, HDFC, Vedanta, Infosys, IOC, Titan Company, Kotak Mahindra Bank, Yes Bank and Axis Bank among others were down 1-3 percent.
Among new listings, ICICI Securities closed at Rs 445.10, down 14.4 percent from issue price of Rs 520 while Mishra Dhatu Nigam managed to close higher at Rs 90.05, a tad above the issue price of Rs 90.
Zensar Technologies jumped 5 percent on bagging a four year, multi-million dollar contract from the City of SanDiego for network services. Capacite Infraprojects rose 2 percent after it bagged repeat orders from Oberoi Realty Group.
Akzo Nobel India scrip price rallied 7 percent ahead of board meeting to consider share buyback. AU Small Finance Bank was up 1.5 percent on agreement with Future Generali India Life insurance to act as corporate agents for life insurance business.
Britannia declined 1.6 percent after Macquarie initiated Underperform rating on the stock with target price at Rs 4,210 as it expects higher competition in cookies and sees limited GST gains.
BSE Limited gained 1.6 percent after Motilal Oswal upgraded to Buy from Neutral and raised target price to Rs 1,070 from Rs 950 on attractive risk reward.
