Trading for the week ended on a sour note as key benchmark indices dropped amid mixed trend in global stocks as caution prevailed ahead of US President-elect Donald Trump's inauguration. The barometer index, the S&P BSE Sensex, shed 274.10 points or 1% to settle at 27,034.50. The Nifty 50 index dropped 85.75 points or 1.02% to settle at 8,349.35. The Sensex and the Nifty, both, hit their lowest closing level in more than a week.
Axis Bank tumbled after reporting weak Q3 results. Bank and metal stocks led losses.
The Sensex shed 274.10 points or 1% to settle at 27,034.50, its lowest closing level since 10 January 2017. The index lost 298.79 points or 1.09% at the day's low of 27,009.81. It lost 44.19 points or 0.16% at the day's high of 27,264.41.
The Nifty 50 index dropped 85.75 points or 1.02% to settle at 8,349.35, its lowest closing level since 10 January 2017. The index lost 94.15 points or 1.11% at the day's low of 8,340.95. It lost 11.45 points or 0.13% at the day's high of 8,423.65.
The BSE Mid-Cap index fell 1.54%. The BSE Small-Cap index dropped 1.27%. The decline in both these indices was higher than the Sensex's decline in percentage terms. The broad market depicted weakness. There were more than two losers against every gainer on BSE. 1,850 shares fell and 854 shares rose. A total of 193 shares were unchanged.
After witnessing a lower opening amid mixed Asian cues and languishing in the red for some period, key indices extended losses as the trading session progressed.
The total turnover on BSE amounted to Rs 2564.93 crore, lower than turnover of Rs 3233.87 crore registered during the previous trading session.
Realty stocks nudged lower. Indiabulls Real Estate (down 3.05%), Housing Development and Infrastructure (down 4.28%), Godrej Properties (down 0.47%), Prestige Estates Projects (down 0.91%), DLF (down 2.72%), Oberoi Realty (down 1.21%), Unitech (down 1.53%) and Sobha (down 1.66%) declined.
The government is reportedly looking to provide higher tax incentives on home loans to boost demand and prop up the faltering realty sector in the upcoming Budget 2017-18, that has been further hit by demonetisation.
The real estate industry reportedly has high expectation from the upcoming budget 2016-17. Stakeholders are reportedly demanding that central government gives relaxation in income tax rate, provide clarity on GST, raise house rent allowance (HRA) deduction and announce policies to standardize construction materials in order to uplift the real estate industry. Realtors' apex body National Real Estate Development Council (NAREDCO) demanded infrastructure status to housing.
Metal & mining stocks declined in weak market. Jindal Steel & Power (down 3.56%), Vedanta (down 2.27%), Tata Steel (down 2.5%), NMDC (down 3.28%), Steel Authority of India (down 2.1%), JSW Steel (down 3.02%), Hindalco Industries (down 2.16%), National Aluminium Company (down 0.91%), and Hindustan Zinc (down 1.72%) edged lower. Bhushan Steel jumped 9.65%.
The steel ministry has reportedly sought reduction in import duty on both coking coal and nickel -- vital components of steel making -- a move that may revive the sector, in the upcoming Budget 2017-18.
Shares of public sector banks dropped. State Bank of India (SBI) (down 2.83%), Canara Bank (down 5.04%), Union Bank of India (down 3.21%), Bank of India (down 1.51%), Punjab National Bank (down 3.07%) Syndicate Bank (down 2.29%), Indian Overseas Bank (down 1.61%), Bank of Baroda (down 3.72%), Andhra Bank (down 1.51%), Oriental Bank of Commerce (down 3.95%), Dena Bank (down 1.43%), and Indian Bank (down 1.61%) declined.
Central Bank of India fell 0.66% after the bank scheduled a board meeting on 23 January 2017, to consider and approve the proposal for premature buyback of 9.40% perpetual bonds of Rs 500 crore. The announcement was made after market hours yesterday, 19 January 2017.
Shares of private sector banks were mixed. IndusInd Bank (up 0.08%), Yes Bank (up 0.85%) and HDFC Bank (up 0.15%) gained. ICICI Bank (down 2.34%) and Kotak Mahindra Bank (down 0.38%) declined.
Axis Bank slumped 7.17% after net profit fell 73.35% to Rs 579.57 crore on 15.72% growth in total income to Rs 14501.21 crore in Q3 December 2016 over Q3 December 2015. The result was announced after market hours yesterday, 19 January 2017.
The bank's gross non-performing assets (NPA) stood at Rs 20466.82 crore as on 31 December 2016 as against Rs 16378.65 crore as on 30 September 2016 and Rs 5724.05 crore as on 31 December 2015.
The bank's ratio of gross NPAs to gross advances stood at 5.22% as on 31 December 2016, as against 4.17% as on 30 September 2016 and 1.68% as on 31 December 2015. The bank's ratio of net NPAs to net advances stood at 2.18% as on 31 December 2016, compared with 2.02% as on 30 September 2016 and 0.75% as on 31 December 2015.
Axis Bank's provisions and contingencies jumped 432.67% to Rs 3795.80 crore in Q3 December 2016 over Q3 December 2015.
Adani Power slumped 11.61% after the company reported consolidated net loss of Rs 325 crore in Q3 December 2016 compared with net profit of Rs 104 crore in Q3 December 2015. The result was announced during trading hours today, 20 January 2017.
Adani Power reported net loss due to lower earnings before interest, tax, depreciation and amortization (EBITDA) and higher finance cost during the quarter. Consolidated total income fell 5.44% to Rs 5873 crore in Q3 December 2016 over Q3 December 2015, largely on account of lower plant load factor (PLF).
EBITDA fell 15.9% to Rs 1708 crore in Q3 December 2016 over Q3 December 2015, mainly due to lower merchant tariff and prior quarter income recognised in Q3 December 2015.
Finance cost increased 8.50% to Rs 1430 crore in Q3 December 2016 over Q3 December 2015, on account of higher working capital utilisation and impact of mark to market on foreign currency derivatives.
Atul fell 3.78% after net profit fell 5.15% to Rs 58.58 crore on 5.01% increase in total income to Rs 679.43 crore in Q3 December 2016 over Q3 December 2015. The result was announced during trading hours today, 20 January 2017.
Sintex Industries dropped 6.94% after consolidated net profit fell 38.90% to Rs 110.81 crore on 0.32% increase in total income to Rs 2096.64 crore in Q3 December 2016 over Q3 December 2015. The result was announced during trading hours today, 20 January 2017.
The Sensex has risen 408.04 points or 1.53% in this month so far (till 20 January 2017). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 4,539.89 points or 20.18%. From a 52-week high of 29,077.28 hit on 8 September 2016, the index has fallen 2,042.78 points or 7.02%. The Sensex is off 2,990.24 points or 9.95% from a record high of 30,024.74 hit on 4 March 2015.
Overseas, most European stocks traded with small gains amid volatility. The European Central Bank held rates and its bond-buying program steady at its Thursday's (19 January 2017) meeting. The bank's President Mario Draghi said the governing body stood ready to intervene further if conditions worsened.
Asian stocks were mixed as caution prevailed in financial markets ahead of US President-elect Donald Trump's inauguration later today, 20 January 2017.
China's Shanghai Composite index settled 0.7% higher. China's economy grew by a faster-than-expected 6.8% in the fourth quarter, boosted by higher government spending and record bank lending. The economy expanded 6.7% in 2016, the National Bureau of Statistics said today, 20 January 2017, roughly in the middle of the government's 6.5-7% growth target but still the slowest pace in 26 years.
US stocks posted losses yesterday, 19 January 2017, as the Dow Jones Industrial Average fell for the fourth straight session. On macroeconomic data front, US homebuilding rebounded sharply in December amid stronger demand for rental housing, and the number of Americans filing for unemployment benefits fell to near the 43-year low touched in mid-November.