The Indian markets moved higher in Wednesday's afternoon trade after media reports said the US Senate leaders had reached deal with the White House on $2 trillion coronavirus stimulus package.
index-heavyweights Reliance Industries and Maruti Suzuki (both up over 8 per cent) lifted the S&P BSE Sensex 545 points, or 2.06 per cent, up to 27,230 levels and the Nifty50 hovered near 7,920 levels, up 125 points, or 1.6 per cent. Sectorally, Nifty Auto index, up 2 per cent, was the big gainer while Nifty PSU Bank index, down 1.3 per cent, was the major drag.
In broader markets, the S&P BSE MidCap index was up 0.7 per cent and the S&P BSE SmallCap index gained 0.18 per cent.
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12:33 PM
Gold Outlook | Hareesh V, Head Commodity Research at Geojit Financial Services
Gold continues to gain on supply worries and economic easing measures taken by various central banks. Air traffic restrictions and closure of gold refineries in many parts of the globe due to spread of deadly coronavirus has raised concerns over the supply of the yellow metal. Safe haven demand on hopes of a possible recession due to the negative impact of virus will also support the commodity.
Technical Outlook: Positive bias likely to continue as long as prices stay above $1585. However, intraday resistance is seen at $1635 which needs to be cleared to trigger further sharp rallies. A close below $1445 is a signal of major liquidation pressure.
12:33 PM
Contribution to the S&P BSE Sensex's gain today
12:26 PM
BROKERAGE RADAR | ICICI Securities on Thomas Cook India
Thomas Cook India is a debt free and an free cash flow (FCF) generating entity. While cancellation of bookings due to virus outbreak would affect revenues and profitability for Q4FY20E and FY21E, the company will be able to recover faster owing to its balance sheet strength and promoter backing. The company recently also announced a buyback plan for 2.6 crore shares at a maximum price of Rs 57.5. At the current market price the company is available at a ~3x FY19 EV/EBITDA.
12:23 PM
BROKERAGE RADAR | Emkay Global Fin Services on Asian Paints
Asian Paints has outperformed most consumer peers given the benefit from crude prices. The stock has corrected only ~20% vs. 15-30% across consumer staples. At 38x FY22E earnings per share (EPS), valuations look relatively unattractive given the near-term uncertainty. Maintain Hold/UW in EAP with a revised TP of Rs1,700, now valuing it at 42x FY22E EPS.
12:19 PM
Market outlook: Trade strategies for Sensex, Nifty during 21-day lockdown
NIFTY 50: The recent fall in the index has broken all the major support levels. The sentiment has become bearish and volumes have started drying. That said, a bounce from the range of 7,800 – 7,500 levels cannot be ruled out. The next significant support comes at 6,500, addressing a medium-term prospect. The immediate supports are 7,300 and 6,900 levels. READ MORE
technicals
12:18 PM
BROKERAGE RADAR | ICICI Securities on Metropolis Healthcare
RATING: BUY | TARGET PRICE: Rs 1,466
The company witnessed healthy growth in volume and realisation until last week but has witnessed some impact since the past 2-3 days. This was mainly due to lock-down in several districts across the country. The discretionary (preventive) volumes have dwindled and don’t expect reversion until situation improves. However, there is no structural impact in the business and volumes would rebound quickly post normalisation. Metropolis has received approval from ICMR to conduct COVID-19 tests (with a price cap of Rs4,500/test). Upgrade to BUY on reasonable valuations.
12:14 PM
BROKERAGE RADAR | Edelweiss Securities on Healthcare sector
Amidst India’s escalating COVID-19 environment, it may be prudent to assess the scenario for hospitals. Earlier, we had pointed out that India has been under-testing; now, with private labs roped in, one cannot ignore the possibility of an exponential rise in COVID-19 cases, putting the healthcare delivery segment under pressure. Particularly for private hospitals, the current situation indicates twin near-term impact: i) social distancing and localized curfews have delayed elective surgeries (60-70% of volumes); and ii) visa cancellations have led to hiatus in medical tourism (10-12% of revenue). While this could dent Q4FY20/Q1FY21E earnings, revival may be slow as surgery pipelines dry up due to lower out-patient (OP) to in-patient (IP) conversion amidst challenged OP occupancy. We expect this trend to play out in most private hospitals; onco-specialist Healthcare Global (HCG) is likely be the least impacted owing to lower exposure to the above factors. Once the dust settles, Apollo Hospitals (APHS) is likely to be the best positioned in terms of structural growth in the Indian healthcare space.
12:14 PM
NEWS ALERT :: Cabinet may take up proposals w.r.t regional rural banks: sources to CNBC TV18
>> Capital support scheme for RRBs may be extended by a year, additional cash infusion likely as well
12:12 PM
NEWS ALERT :: G20 to meet on Thursday to discuss Covid-19 outbreak
12:10 PM
Consumption sector will not be affected much by the 21-day lockdown
The 21-day lockdown will definitely have an adverse impact on the economy, as it will drag down the gross domestic product (GDP) in the subsequent quarters. I believe the full-year impact on GDP will be around 150 basis points (bps). However, it must be noted that there won't be permanent demand destruction. Once this lockdown gets over, things will return to normalcy. As regards specific sectors, consumption won't be affected as people will continue to buy daily use, essential commodities and staples. READ MORE
Harendra Kumar, Elara Capital
index-heavyweights Reliance Industries and Maruti Suzuki (both up over 8 per cent) lifted the S&P BSE Sensex 545 points, or 2.06 per cent, up to 27,230 levels and the Nifty50 hovered near 7,920 levels, up 125 points, or 1.6 per cent. Sectorally, Nifty Auto index, up 2 per cent, was the big gainer while Nifty PSU Bank index, down 1.3 per cent, was the major drag.
In broader markets, the S&P BSE MidCap index was up 0.7 per cent and the S&P BSE SmallCap index gained 0.18 per cent.
CATCH ALL THE LIVE UPDATES
Auto Refresh
12:33 PM
Gold Outlook | Hareesh V, Head Commodity Research at Geojit Financial Services
Gold continues to gain on supply worries and economic easing measures taken by various central banks. Air traffic restrictions and closure of gold refineries in many parts of the globe due to spread of deadly coronavirus has raised concerns over the supply of the yellow metal. Safe haven demand on hopes of a possible recession due to the negative impact of virus will also support the commodity.
Technical Outlook: Positive bias likely to continue as long as prices stay above $1585. However, intraday resistance is seen at $1635 which needs to be cleared to trigger further sharp rallies. A close below $1445 is a signal of major liquidation pressure.
12:33 PM
Contribution to the S&P BSE Sensex's gain today
12:26 PM
BROKERAGE RADAR | ICICI Securities on Thomas Cook India
Thomas Cook India is a debt free and an free cash flow (FCF) generating entity. While cancellation of bookings due to virus outbreak would affect revenues and profitability for Q4FY20E and FY21E, the company will be able to recover faster owing to its balance sheet strength and promoter backing. The company recently also announced a buyback plan for 2.6 crore shares at a maximum price of Rs 57.5. At the current market price the company is available at a ~3x FY19 EV/EBITDA.
12:23 PM
BROKERAGE RADAR | Emkay Global Fin Services on Asian Paints
Asian Paints has outperformed most consumer peers given the benefit from crude prices. The stock has corrected only ~20% vs. 15-30% across consumer staples. At 38x FY22E earnings per share (EPS), valuations look relatively unattractive given the near-term uncertainty. Maintain Hold/UW in EAP with a revised TP of Rs1,700, now valuing it at 42x FY22E EPS.
12:19 PM
Market outlook: Trade strategies for Sensex, Nifty during 21-day lockdown
NIFTY 50: The recent fall in the index has broken all the major support levels. The sentiment has become bearish and volumes have started drying. That said, a bounce from the range of 7,800 – 7,500 levels cannot be ruled out. The next significant support comes at 6,500, addressing a medium-term prospect. The immediate supports are 7,300 and 6,900 levels. READ MORE
technicals
12:18 PM
BROKERAGE RADAR | ICICI Securities on Metropolis Healthcare
RATING: BUY | TARGET PRICE: Rs 1,466
The company witnessed healthy growth in volume and realisation until last week but has witnessed some impact since the past 2-3 days. This was mainly due to lock-down in several districts across the country. The discretionary (preventive) volumes have dwindled and don’t expect reversion until situation improves. However, there is no structural impact in the business and volumes would rebound quickly post normalisation. Metropolis has received approval from ICMR to conduct COVID-19 tests (with a price cap of Rs4,500/test). Upgrade to BUY on reasonable valuations.
12:14 PM
BROKERAGE RADAR | Edelweiss Securities on Healthcare sector
Amidst India’s escalating COVID-19 environment, it may be prudent to assess the scenario for hospitals. Earlier, we had pointed out that India has been under-testing; now, with private labs roped in, one cannot ignore the possibility of an exponential rise in COVID-19 cases, putting the healthcare delivery segment under pressure. Particularly for private hospitals, the current situation indicates twin near-term impact: i) social distancing and localized curfews have delayed elective surgeries (60-70% of volumes); and ii) visa cancellations have led to hiatus in medical tourism (10-12% of revenue). While this could dent Q4FY20/Q1FY21E earnings, revival may be slow as surgery pipelines dry up due to lower out-patient (OP) to in-patient (IP) conversion amidst challenged OP occupancy. We expect this trend to play out in most private hospitals; onco-specialist Healthcare Global (HCG) is likely be the least impacted owing to lower exposure to the above factors. Once the dust settles, Apollo Hospitals (APHS) is likely to be the best positioned in terms of structural growth in the Indian healthcare space.
12:14 PM
NEWS ALERT :: Cabinet may take up proposals w.r.t regional rural banks: sources to CNBC TV18
>> Capital support scheme for RRBs may be extended by a year, additional cash infusion likely as well
12:12 PM
NEWS ALERT :: G20 to meet on Thursday to discuss Covid-19 outbreak
12:10 PM
Consumption sector will not be affected much by the 21-day lockdown
The 21-day lockdown will definitely have an adverse impact on the economy, as it will drag down the gross domestic product (GDP) in the subsequent quarters. I believe the full-year impact on GDP will be around 150 basis points (bps). However, it must be noted that there won't be permanent demand destruction. Once this lockdown gets over, things will return to normalcy. As regards specific sectors, consumption won't be affected as people will continue to buy daily use, essential commodities and staples. READ MORE
Harendra Kumar, Elara Capital
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