Sensex Edges Lower, Nifty Hovers Around 8,650; Infosys Falls 3%

9:27 a.m.: Sensex edged lower in opening deals while 50-share Nifty was hovering around its crucial psychological level of 8,650 on the back of selling in index heavyweights like Infosys, Tata Motors, Larsen & Toubro and Sun Pharma.

The Sensex fell as much as 62 points to hit low of 28,091 and Nifty declined 25 points to 8,647.

Infosys was the top Nifty loser, the stock fell 3 per cent to Rs 1,035 after RBS cancelled a 5-year order for launching new bank. Infosys was technology partner for the new bank and order loss could hit annual revenue by $40-50 million. EPS estimates could be cut by 1-2 per cent and Infosys will cut 3,000 jobs over the next few months.
Tata Motors, Tech Mahindra, Larsen & Toubro, BHEL, Zee Entertainment, Bharti Airtel, HDFC, Hero MotoCorp and Bosch Ltd were also among the laggards.

On the other hand, Power Grid, BPCL, Yes Bank, Hindalco, HCL Tech, ITC, Cipla, Lupin and Adani Ports were among the gainers.

On the sectoral front, realty, IT auto, capital goods and consumer durable stocks were witnessing selling pressure while buying was seen in select banking, power and FMCG shares.

The broader markets were trading flat. The BSE mid-cap index jumped 0.18 per cent and the small-cap index climbed 0.03 per cent.

8:00 a.m.: Sensex and Nifty are set to open on a flat note in trades today tracking subdued trading of Nifty futures on the Singapore Stock Exchange.

The Nifty futures traded on the Singapore Exchange traded 0.07 per cent or 6 points lower at 8,710.

Meanwhile, most of the other Asian share markets were also trading with a negative bias. Japan's Nikkei was 0.27 per cent, Taiwan Weighted fell 0.41 per cent and Shanghai Composite was down 0.07 per cent.

Overnight, all three major U.S. stock indexes ended at all-time highs on Monday, extending their record-setting climb of the past few weeks as the dollar's weakness boosted commodity-related shares.

The S&P 500's earnings recession that began in the third quarter of 2015 is on track to end in the fourth quarter. Estimates show profit growth of 8.3 percent for S&P 500 earnings in the fourth quarter, Thomson Reuters data shows.

The Dow Jones industrial average ended up 59.58 points, or 0.32 percent, at 18,636.05, the S&P 500 gained 6.1 points, or 0.28 percent, to 2,190.15 and the Nasdaq Composite added 29.12 points, or 0.56 percent, to 5,262.02.

Back home, foreign institutional investors bought shares worth Rs 1,203.71 crore while domestic investors sold shares worth Rs 392.47 crore on Friday.

Infosys will be on investors' radar after RBS canceled a 5-year order for launching new bank. Infosys was technology partner for the new bank and order loss could hit annual revenue by $40-50 million. EPS estimates could be cut by 1-2 per cent and Infosys will cut 3,000 jobs over the next few months.

SP Apparels Makes Market Debut, Jumps 8%

SP Apparels shares jumped nearly 8 per cent to Rs 288.75 on its market debut, against the issue price of Rs 268.

The garment maker's IPO was oversubscribed nearly three times during August 2-4.

The portion set aside for qualified institutional buyers (QIBs) was oversubscribed 2.21 times, while non-institutional investors 5.10 times, as per NSE data.
Retail investors portion was oversubscribed 1.90 times. Price band for the IPO was fixed at Rs 258-268 per share.

This was the 16th IPO to have hit the market so far this year. SP Apparels is a manufacturer and exporter of knitted garments for infants and children.

At 10:17 a.m., shares of SP Apparels were up 6.5 per cent at Rs 285.4 against it issue price. In comparison, Nifty50 index was up 1 per cent.

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Aditya Birla Nuvo Sinks 25% On Merger Announcement With Grasim

Aditya Birla Nuvo sank as much as 25 per cent on Friday following its merger announcement with subsidiary Grasim Industries.

Post the merger, Aditya Birla Nuvo's financial services business will be spun off into a separate entity.

Under the deal, shareholders of Aditya Birla Nuvo will get 3 shares of Grasim for every 10 shares of Aditya Birla Nuvo. When Aditya Birla Financial Services is spun off from Grasim, shareholders will get seven shares of the financial services company for each share held in Grasim.
Analysts say the share swap ratio appears to be in favour of Grasim.

"Grasim, which is already a holding company becomes even more bigger conglomerate, to that extent it is slightly negative. Already it is trading at 40-50 per cent discount to its subsidiary Ultratech, now I think the discount will widen further given all these unrelated business are coming in to it," market expert Rakesh Arora told NDTV Profit.

"As of now it is not clear what benefit the minority shareholders are getting," he further added.

Meanwhile, global brokerage CLSA said the merger adds complexity and raises uncertainty on capital allocation.

As of 10.03 a.m. Aditya Birla Nuvo shares traded 18.60 per cent lower at Rs 1,271.9 while Grasim Industries shares were down 2.1 per cent lower at Rs 4,444.25. In comparision the broader Nifty was up 0.84 per cent.

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Aditya Birla Nuvo Q1 Profit Falls 57% To Rs 305 Crore

New Delhi: Diversified company Aditya Birla Nuvo on Thursday reported a 56.79 per cent decline in consolidated net profit at o Rs 305.15 crore for the fiscal first quarter that ended on June 30, 2016.

The company had posted a net profit of Rs 706.23 crore for the corresponding period a year ago.

Total income from operations was up marginally at Rs 3,194.36 crore in the period under review as against Rs 3,188.22 crore in the corresponding period a year ago, Aditya Birla Nuvo (ABNL) said in a filing to the BSE.

 "...net profit at Rs 305 crore de-grew year-on-year due to reduction of ABNL's share in Idea's net profit by Rs 148 crore. Net profit of Idea Cellular declined from Rs 855 crore to Rs 220 crore due to rise in interest and amortisation costs pertaining to the spectrum acquired in the earlier years," ABNL said.

Income from other financial services was up 43.32 per cent at Rs 918.48 crore during the quarter under review as against Rs 640.82 crore a year ago.

Textiles segment revenue was down 14.70 per cent at Rs 351.59 crore in the quarter under review as against Rs 412.19 crore in the year-ago period.

Similarly, revenue from agri-business was down 25.41 per cent at Rs 500.96 crore in the quarter under review as against Rs 671.66 crore in year-ago period.

Shares in ABNL, on Thursday, settled 3.5 per cent higher at Rs 1,565.70 apiece on the BSE, whose benchmark Sensex index finished up 0.31 per cent.

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BSE Head Sees Tighter Algo Trading Rules As Boon For Markets

Mumbai: Proposals by Securities and Exchange Board of India (SEBI) to tighten rules on algorithmic trading could help boost confidence in markets and won't hurt the country's second biggest bourse, the head of Indian exchange operator BSE Ltd told Reuters.

The main capital markets regulator last week unveiled a discussion paper on various limits on algo traders, including reduced speed limits at which trades are executed, due to concerns about fair access to markets.

"Well-designed forward looking regulations create better trust," Ashishkumar Chauhan, chief executive of BSE, Asia's oldest exchange, said in an interview with Reuters late on Wednesday.

"We are not worried about undue impact on our business," he said, adding that he expects the new rules could actually boost, rather than decrease trading volumes.

Algorithmic trading has become a major source of income for both the BSE and its larger rival the National Stock Exchange Ltd. The new rules could come into force as both exchanges look to go public.

The BSE is soon expected to file a listing application that bankers estimate could value the exchange at about $750 million to $1 billion.

About 90 percent to 95 percent of the BSE's order flow is currently being generated by algo trading, and some 40 percent to 50 percent of executed trades also being driven by such systems.

Algo traders have warned that the SEBI proposals, which are not yet final, are too restrictive and could force trading into overseas markets.

Indian markets have rallied in recent months on expectations of a recovery in earnings as the government has made progress in advancing some reforms, including recently passing a landmark goods and services tax.

($1 = 66.8800 Indian rupees)

Sun Pharma Shares Slump After Taro's Q1 Announcement

Sun Pharma shares slumped nearly 4 per cent on Thursday, following the earnings announcement of its US subsidiary Taro Pharma. Sun Pharma was among the top losers in the Nifty50 today.

Taro Pharma, which contributes 25 per cent to sales of Sun Pharma, on Wednesday reported 8.6 per cent rise in Q1 sales at $233.8 million on a smaller base. However, the company said that volumes slightly decreased. Taro Pharma's gross profit of $182.8 million increased $11 million in Q1.

"Sales from new products are beginning to accelerate. However, we continue to experience increased competitive intensity," said Kal Sundaram, CEO of Taro Pharma.


Taro's R&D expenses increased 23.2 per cent to $17.9 million, while selling, marketing, general and administrative expenses slightly decreased.

In another negative development, Taro Pharma's competitor Perrigo cut its 2016 guidance for the second time, citing higher price erosion.

Sun Pharma shares were down 1 per cent at Rs 809.20 as of 11.33 a.m., underperforming the broader Nifty that was up 0.3 per cent.

Rupee Slips To 66.90/Dollar In Early Trade

Mumbai: The rupee was trading lower by 18 paise at 66.90 against the US dollar in early trade today on higher demand for the American currency from importers and banks amid a lower opening in the domestic equity market.

Dealers attributed the rupee's fall to increased demand for the US currency, but dollar's weakness against some currencies overseas restricted the losses.

The rupee had ended higher by 12 paise at 66.72 against the US currency in yesterday's trade on dollar selling by banks and exporters on the back of persistent foreign capital inflows.

Meanwhile, the benchmark BSE Sensex fell 73.70 points or 0.27 per cent to 27,701.18 in early deals.

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