Monsoon session sees higher rate of legislative business done
The markets continued to remain choppy and at the end of Wednesday last week, it appeared that the correction had truly set in. There was a strong rally thereafter and the markets managed to close flat for the week. The BSE SENSEX gained 42.03 points or 0.15 per cent to close at 28,152.40 while NIFTY lost 11 points or 0.13 per cent to close at 8,672.15 points. The broader indices saw the BSE100, BSE200 and BSE500 close with minor losses of 0.18 per cent, 0.17 per cent and 0.25 per cent respectively. BSE MIDCAP gained 0.43 per cent, while BSE SMALLCAP lost 0.75 per cent.
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Minister of Commerce & Industry, Nirmala Sitharaman and TMC leader Derek O’Brien arrive at Parliament house during the monsoon session in New Delhi on Friday. Pics/PTI
The top sectoral gainer was BSE FMCG up 0.97 per cent followed by BSE BANKEX 0.53 per cent and BSEIT 0.18 per cent. The losers were led by BSEHEACARE down 2.12 per cent, BSEREALTY 2.06 per cent and BSEAUTO 1.21 per cent. In individual stocks the top gainer was Axis Bank up 4.47 per cent followed by ONGC 3.23 per cent, HDFC 2.91 per cent and Coal India 2.60 per cent. The losers were led by Lupin down 5.73 per cent, Bank of Baroda 5.17 per cent, Bharti Airtel 4.23 per cent and Hero Moto 3.52 per cent. In other stocks, LIC Housing gained 6.74 per cent but Wockhardt lost 20.18 per cent.
Sharp fall
The Kumar Mangalam Birla group announced a merger of its two flagship companies, Grasim and AB Nuvo, which was not liked by the markets. The prices of both companies fell quite sharply with Grasim down 13.36 per cent and AB Nuvo down 16.72 per cent. The management did host a concall post the announcement, but concerns still remain. Expect more volatility in the coming week and some more clarifications by way of broker reports.
Dow Jones eked out gains of 32.94 points or 0.18 per cent to close at 18,576.47 points. The Indian Rupee lost 12 paisa or 0.18 per cent to close at Rs 66.89. Since the last two to three months, it has traded in a range of Rs 66.70-67.50. The monsoon session of Parliament has ended, and a substantially higher amount of legislative business was done this time around. One is not sure who should be complimented for this, but work done is good news for the country.
Issue view
In primary market news, the issue from Ratnakar Bank Limited would open on Friday, August 19 and close on Tuesday August 23. The issue would consist of a fresh issue of Rs 832.5 crore and an offer for sale of 1.69 crore shares in a price band of Rs 224-225. This is the second issue after Equitas Holdings which has a difference in price band of a mere one rupee.
Two issues listed during the week, with Dilip Buildcon shares gaining 11.51 per cent. These shares were issued at Rs 219 and the issue had received excellent response with the issue subscribed 20.95 times with HNIs subscribing their bucket 79.64 times. The other issue to list was S P Apparels which had issued shares at Rs 268. The share gained 10.07 per cent on Day One. The issue was subscribed 2.66 times.
Volatile style
Results from PSU banks were a mixed bag with the larger banks reporting a slowing down. It may be a good thing that the worst is behind us and hopefully things should improve, once the economy starts to improve. While for the moment, the markets have rallied on Friday in anticipation or short covering one is not sure, but one fact that remains is the “liquidity”. This factor alone seems to be driving markets and one must remember that liquidity flows turn on and turn off as quickly as they began.
Markets will continue to remain volatile and I maintain my stand that market valuations are currently overstretched and need to consolidate for any further rally, from hereon. The current August series of futures which midway through the series is currently flat, and, almost all good news is digested. Take money off the table and wait for better buying opportunities.
Disclaimer: No financial information whatsoever published anywhere in this newspaper should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is for educational and information purposes only and under no circumstances should be used for actual trading or making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment or trading decisions, based on information published here. Any reader taking decisions based on any information published here does so entirely at his or her risk.
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