Indian share markets continued to trade below the dotted line in the afternoon session and finished marginally lower as the RBI monetary policy panel starts its two-day meeting.
At the closing bell, the BSE Sensex closed lower by 67 points and the NSE Nifty finished lower by 10 points. The S&P BSE Mid Cap finished up by 0.6% while S&P BSE Small Cap finished flat. Losses were largely seen in metal sector, capital goods sector, and power sector.
Asian stock markets finished broadly lower today with shares in Hong Kong leading the region. The Hang Seng is down 1.01% while Japan's Nikkei 225 is off 0.37% and China's Shanghai Composite is lower by 0.18%. European markets are mixed. The FTSE 100 is higher by 0.27%, while the CAC 40 is leading the DAX lower. They are down 0.23% and 0.06% respectively.
Rupee was trading at Rs 64.37 against the US$ in the afternoon session. Oil prices were trading at US$ 57.23 at the time of writing.
As per an article in The Economic Times, a public relation firm Fortuna Public Relations has approached Mumbai bench of National Company Law Tribunal (NCLT) against Anil Ambani-run Reliance Communications for insolvency proceedings, alleging the telecom operator failed to its pay dues. The NCLT plans to hear the case on December 19.
Meanwhile, Fitch on Tuesday withdrew Reliance Communications' rating for commercial reasons. Accordingly, the rating agency will no longer provide ratings or analytical coverage for RCom.
Rcom share price finished the day down by 1.2% on the BSE.
In news from the auto ancillary sector, Bharat Forge share price rallied over 3.3% after strong trend continued in North America class 8 truck orders in November.
North America class 8 truck orders for the November month were at 32,387 units, a massive growth of 68% over 19,285 units in year-ago.
Reportedly, the reason for strong leap in truck and tractor sales was US economic growth that has been topping 3% for last two quarters.
However, month-on-month basis, class 8 truck orders declined 9% from 35,700 units in October.
Notably, Bharat Forge earns significant amount of revenues from Class 8 trucks in the US. North American business contributes 40% to company's total revenue.
Moving on to news from cement sector. Domestic credit rating agency, ICRA in its latest report has forecasted that India's cement demand is likely to register a modest growth of 1% in the financial year 2017-18, on the back of pick up in the housing segment both affordable and rural housing and; infrastructure segment, mostly road and irrigation projects.
According to the report, the cement offtake has continued to remain weak in the first half of the financial year (H1 FY18) and also in the month of October, owing to factors such as weak real estate activity, sand shortage and Goods, and Services Tax (GST) implementation issues.
ICRA also said that new project announcements from the private sector continue to remain weak and revival of public-private partnership is crucial to improve the pace of infrastructure development.
During seven months of FY18, the cement production reported de-growth of 1.6% to 165.6 million MT as compared to 168.3 million MT during 7M FY17. Besides, production declined by 3.3% in Q1 FY18 and by 0.4% in Q2 FY18 on a Y-o-Y basis. Demand during Q1 FY18 was adversely impacted due to various local issues across regions - in the North (especially in the states of UP and Punjab) the off-take was impacted by sand shortage and labour unavailability, while in the West the implementation of the Real Estate Regulatory Authority (RERA) Bill resulted in construction activity slowing down.
Cement stocks finished the day on a mixed note with Prism cement share price and JK Lakshmi Cement share price leading the gains.
In news from banking sector, Yes Bank share price surged 1.6% in today's trade after the company in collaboration with Tata Power Delhi Distribution (TPDDL), a joint venture (JV) of Tata Power and the Government of Delhi, has made live a new and easy payment mode for its consumers - Unified Payment Interface (UPI).
TPDDL consumers can easily make payments through UPI by using their smartphones to scan the dynamic QR code printed on the bills, both physical and electronic, through UPI compliant apps, such as BHIM YES Pay, PhonePe, or any other UPI-compliant apps.
In another development, PNB share price finished up by 1.9% on the BSE after it was reported that the company has raised over Rs 13.15 billion through sale of shares in subsidiary firm PNB Housing Finance (PNBHFL) through the offer for sale (OFS) route.
The Bank successfully sold 98,15,860 equity shares of PNBHFL to different investors (non-retail and retail) at above the floor price/cut off price.
Moving on to news from IPO segment. Shalby Ltd's initial public offering (IPO) was subscribed 3% so far on the first day of the share sale on Tuesday.
As of 12.30pm, the IPO received bids for 470,460 shares against the total issue size of 14,521,686 shares, according to NSE data. The IPO closes on 7 December.
Shalby, which runs a multi-specialty hospital chain, has set a price band of Rs 245-248 per share for the IPO and aims to raise Rs 5.04 billion.
Meanwhile, 2017 will undoubtedly be considered as the year of IPOs. The IPO activity is headed for a record. They have garnered more than Rs 650 billion, surpassing the previous record of Rs 375 billion in 2010. This year, the demand has exceeded expectations.
IPOs Underperform Broad Market Indices
What if one had invested in all the IPOs? How have the IPOs performed in 2017? And, have they outperformed the indices?
According to an article in Business Standard, an investor who bet on the 33 IPOs of 2017 (on a weighted average basis) has seen the value of investment rise by 17%. However, compared to broad market indices, the underperformance is a bitter disappointment.
Interestingly, if you take the Avenue Supermarts (D-mart) and HDFC Life out of the equation from the IPOs above, the gains drop to a meager 6%. Compared to this, the Sensex has gained 27%, while the small-cap index surged more than 50%.
And here's a note from Profit Hunter
The Nifty 50 index fell more than 250 points in the past three sessions as Indian indices continue to witness selling pressure. However, the index recovered smartly towards the end of today's session after falling 60 points in the morning trade.
Bank stocks should be in focus tomorrow among the traders as the Reserve Bank of India (RBI) will announce its sixth bi-monthly monetary policy. Among the bank stocks, the federal bank has caught our eyes.
The stock had a stellar rally from the low of 42 made in April 2016 to a high of 120 touched in May 2017. But since then, the stock has been trading in a narrow range of 105 - 120. In October, the stock hit a life-time high of 127 but couldn't sustain up for long and immediately slipped lower.
Today, it hit a low of 105 and recovered strongly to end the session 2% up. Most importantly, the stock found a strong support from the 200-day moving average (DMA). The 200 DMA also acted as a strong support for the stock in December 2016 from where the stock rallied sharply.
So it will be interesting to see if the stock can again rally sharply from the 200 DMA ahead of RBI monetary policy.
Federal Bank Bounced From 200 DMA
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