Nifty, Sensex Muted At Open As ICICI Bank, TCS Drag: Stock Market Update At Open
Benchmark equity indices saw a muted opening and then slipped into losses as share of TCS and ICICI Bank dragged. TCS' stock traded lower as most analysts reduced target price for the stock.
At pre-open, Nifty 50 was at 24985.30 ,down 0.05% or 13.15 and Sensex was at 81488.10, down 0.15% or 123.31 points.
The markets ended the weekly expiry day on a flat note at 24,998. Nothing has changed; support and resistance are very well-placed, at 24,900 and 25,200, and a breakout on either side will provide a clear picture."
Share prices of HDFC Bank Ltd., ICICI Bank Ltd., Bharti Airtel Ltd., Tata Consultancy Services Ltd., and Bajaj Finance Ltd. dragged the index lower.
While those of Infosys Ltd., HCL Tech Ltd., Reliance Industries Ltd., Sun Pharmaceutical Industries Ltd., and Hindalco Industries Ltd.
Most sectoral indices were lower at open with Nifty Finance losing the most.
At pre-open, Nifty 50 was at 24985.30 ,down 0.05% or 13.15 and Sensex was at 81488.10, down 0.15% or 123.31 points.
Aditya Gaggar, director of Progressive Shares said, "The markets ended the weekly expiry day on a flat note at 24,998. Nothing has changed; support and resistance are very well-placed, at 24,900 and 25,200, and a breakout on either side will provide a clear picture."
Yield On The 10-Year Bond Opens Flat
-The yield on the 10-year bond opened flat at 6.77%.
-It closed at 6.78% on Thursday.
Source: Bloomberg
Rupee Strengthens Against US Dollar
-Rupee strengthened by 2 paise to open at 83.96 against the US dollar.
-It closed at 83.98 on Thursday.
Source: Bloomberg
Arkade Developers Q1FY25 (Cons, YoY)
Revenue up 102.97% at Rs 125.38 crore vs Rs 61.77 crore
Ebitda up 328.32% at Rs 41.95 crore vs Rs 9.79 crore
Margin at 33.45% vs 15.85%
Net profit up 359.51% at Rs 30.22 crore vs Rs 6.58 crore
Nirmal Bang, HSBC, Citi On TCS After Results
Citi has maintained 'sell' with target of Rs 3,935 implying 7% downside. It said EBIT was 4% below estimates and expects modest and gradual recovery, forward indicators looking weak. Margin levers are close to optimal, according to Citi as it expects cost pressures going forward. It said that it prefers Infosys over TCS.
HSBC has maintained 'Buy' with target of Rs 4,540, upside 6.7%. It said that 2Q reflected painful slow demand recovery and demand for discretionary projects remain weak while margins were a rare miss. 2Q performance and mediocre medium term outlook led to minor cuts in estimates and it believes TCS is best managed in the sector.
HDFC Securities Lowers Tata Elxsi Target Price After Result
HDFC Securities has lowered the target price of Tata Elxsi to Rs 6,925, from Rs 7,120, implying downside of 11%. The brokerage maintains its 'Reduce' rating for the stock after the company announced its Sept. quarter results.
It said that strength in transportation (56% of revenue) was offset by weakness in Media & Communications, Healthcare. It expects healthcare vertical to recover by FY25 end but media & communications could take longer to recover.
The brokerage believes that T1 client growth, transportation will drive growth over FY24-26 and growth trajectory is expected to improve ahead while valuations are still a stretch.
Gold Rises On Expectations Of Rate Cut After Inflation Data
The December futures contract of Comex Gold traded up by 0.74% at $2,658.90 an ounce as CME Fedwatch tool showed more chances of rate cut in November after US inflation data on Thursday. Additionally, tensions in the middle east along with demand from central banks uplifted the sentiment.
Oil Price Update: Brent Crude Futures Fall After 3% Rise Thursday
At 8:05 a.m., the December futures contract of Brent Crude traded $78.97 a barrel and November contract of WTI Futures was $75.52 a barrel. On Friday, the commodity had risen over 3% amid hurricane Milton in US and rising tensions in the middle east.
In Florida a quarter of fuel stations sold out of gasoline, knocking out power to more than 3.4 million homes and businesses.
Jefferies On Bandhan Bank
Jefferies has maintained a 'buy' with a target price of Rs 240 per share, an upside of 27% from the previous close. It said that the new chief executive officer comes with a strong background and recovery from credit guarantees adds to credibility. The brokerage expects the lender's asset quality to behave better than other microfinance institutions and a 15% return on equity in the business. Valuations look attractive at 1.1 times the financial year 2026 price-to-book value, it said.
JP Morgan, CLSA, Nuvama On TCS After Q2 Results
JP Morgan has maintained 'overweight' rating with a target price of Rs 5,100 per share from Rs 5,200 apiece, an upside of 21% from the previous close. The brokerage said that the company's international business weakest since covid and all growth was led by sharp margin dilutive BSNL contract. Falling revenue was the result of several clients cancelling discretionary projects simultaneously and the brokerage now sees gradual recovery across US BFS and UK Banking. It also pointed out that lengthening sales cycles and signings were unimpressive and fear lack of broad-based recovery. Consequently, it has trimmed margin estimates and earnings by 50 basis points and 2% respectively for fiscal 2025 and recommends using any sharp correction to add.
TCS Q2 Results: Profit Falls 1%, Misses Estimates
Nuvama has lowered its target price to Rs 5,100 from Rs 5,250 while maintaining its 'buy'. The new target suggests upside of 21%. The brokerage said that Q2FY25 was a modest quarter for TCS mainly due to client specific issues and management remains optimistic about demand revival in BFSI and bottoming out of the retail vertical. . Nuvama expects margin to recover with less contribution from BSNL, which is a lower-margin deal and growth for TCS and sector to see material uptick Q4FY25 onwards.
CLSA has also lowered target to Rs 4094 from Rs 4187, implying downside of 3.1%. It said that the miss in margins due to sharper than expected ramp up in BSNL deal leading to high pass through costs. It also noted few client specific issues in UK/US, which further deteriorated revenue growth
However, Demand commentary remains cautious in the near term, Optimistic in medium term and it assume ramp down on BSNL to happen by Q1FY26 from prior assumption of Q3FY26.
The brokerage finds the stock's valuation stretched and it remains cautious on the IT sector .
Asia Market Open: Indices Mixed Ahead Of BOK Rate Decision; CSI 300 Down 1%
Asian indices were mostly higher in the early trade even as US markets fell. Investors will look forward to the South Korea central bank decision.
At 7:30 a.m., Nikkei was trading 0.6% higher and South Korea's Kospi rose 0. 4%, however, CSI 300 fell more than 1% and Australia's ASX 200 traded down 0.1%.
US Market Close: Indices End Lower Post Inflation Data
In the US indices ended lower after fresh inflation data raised concerns that inflation wasn't cooling. S&P 500 was down 0.21% to close at 5,780.05, Dow Jones was down 0.14% to close at 42,454.12, and Nasdaq Composite fell 0.05% to 18,282.05.
Investors now await the the release of country's producer price index due Friday as well as quarterly results of JP Morgan Chase and Wells Fargo.
GIFT Nifty was trading at25,084.00, up by 21.5 points or 0.1% as of 06:54 a.m.. Among other stocks, Tata Consultancy Services Ltd. and Indian Renewable Energy Development Agency Ltd. will react to their quarterly earnings and Mazagon Dock Shipbuilders Ltd. shares on order win.
On Thursday, benchmark equity indices closed with little gains ahead of TCS September quarter earnings, and inflation data from the US.
The Nifty ended 0.07%, or 16.50 points up at 24,998.45 and Sensex advanced 0.18%, or 144.3 points, to close at 81,611.4.
Overseas investors, commonly known as foreign portfolio investors, or FPIs, remained net sellers of Indian equities for nine consecutive sessions on Thursday.
Domestic institutional investors (DIIs) bought stocks worth Rs 3,878.33 crore and according to provisional data from the National Stock Exchange, FPIs offloaded stocks worth Rs 4,926.61 crore.
The Indian rupee weakened by 2 paise to close at 83.98 against the US dollar.
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