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Wednesday 18 February 2015

Sensex, Nifty erase early gains; Reliance, ICICI Bank drag

10:45am Market Update

The market erased early gains on profit booking. The Sensex rose 11.43 points to 29331.69 and the Nifty fell 16.35 points to 8852.75. About 1182 shares have advanced, 1050 shares declined, and 176 shares are unchanged.

ICICI Bank and Reliance Industries dragged the market, down 1 percent each. Tata Power, State Bank of India, Axis Bank, ITC, Bajaj Auto, NTPC and Wipro were down 0.6-1 percent.

10:30am Gold companies in focus

The Reserve Bank on Wednesday lifted the ban on imports of gold coins and medallions by banks and trading houses. The RBI in a notification also said banks are permitted to import gold on consignment basis. Domestic sales will be, however, permitted against upfront payment only.

Speaking on the above circular, S Subramaniam,CFO, Titan Co said the RBI move was more on the credit side – there was issue on credit on gold imports for domestic consumption but that has now been clarified. The gold metal loan authorised by domestic banks will now be available for domestic consumption.

The most welcome development of this easing in gold lending norms is that hedging will become easier.

Although it does not change things too much for the company per se because earlier also RBI had liberalised gold loan credit for some four-five banks and they were already getting credit, said Subramaniam. However, now the ban has been lifted and all banks can provide credit.

10:00am Market Check

The market remained firm for the seventh consecutive session today. The Sensex rose 121.36 points to 29441.62 and the Nifty climbed 24.30 points to 8893.40.

About 1276 shares have advanced, 791 shares declined, and 161 shares are unchanged on the Bombay Stock Exchange.

The reality of the market right now is that it is way ahead of itself, says Vibhav Kapoor of IL&FS. He is also wary of the market as he expects below 10 percent returns from equities in the next 12 months.

However, a 5-7 percent rally in the market will make a case for asset reallocation, he adds.

Tata Steel topped the buying list, up 2.5 percent followed by Sesa Sterlite and Hindalco Industries with 1.6 percent upside. HDFC, Infosys, Cipla, Bharti Airtel, L&T, Maruti and Mahindra & Mahindra gained 1-4 percent.

However, ITC, Bajaj Auto, State Bank of India, Dr Reddy's Labs, ICICI Bank, Wipro, Reliance Industries and NTPC were under pressure. More information please visit this site www.bigprofitbuzz.com


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