RBI cuts repo rate: 12 rate-sensitive stocks that will benefit the most

The Reserve Bank of India (RBI) slashed repo rate by 25 bps to 6 percent on April 4 as expected and kept the stance unchanged to ‘Neutral’. This is the second rate cut in 2019.

“These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 percent within a band of +/- 2 percent while supporting growth,” the central bank said in a statement.

The MPC notes that the output gap remains negative and the domestic economy is facing headwinds, especially on the global front. The need is to strengthen domestic growth impulses by spurring private investment which has remained sluggish.

Rate cut usually acts as a sentiment booster and aid companies that have to service large debts. A cut by RBI injects liquidity in the economy. Loans with a low rate lead to an increase in buying interest in the consumer-driven economy which will help India Inc. to deliver strong earnings growth.

Top sectors which are likely to benefit the most from a rate cut are banking, NBFC, infrastructure and real estate. This rate cut will help in boosting demand and ease interest rate pressure on debt-heavy companies, suggest experts.

“If we look from the perspective of real estate sector the RBI rate cut will impact the home loan interest rate, this will allow the reduction in EMIs which will bring a positive impact on the sector's growth. IndiaBulls real estate and DLF are the two stocks which have some debt burden and seems to get the benefit of this rate cut,” Ritesh Ashar, CSO at KIFS Trade Capital told Moneycontrol.

“NBFC sector along with banks are also likely to get the benefit of this rate cut as the cost of funding will become low and there would be an improvement in the margin and in this space stocks like DHFL and Indiabulls Housing Finance looks quite promising,” he said.

Source:https://www.moneycontrol.com/news/business/stocks/rbi-cuts-repo-rate-12-rate-sensitive-stocks-that-will-benefit-the-most-3753751.html

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Gold gains as dollar eases; focus on US-China talks

Gold gained on Thursday, supported by an easing dollar as investors awaited progress on the ongoing Sino-U.S. trade negotiations after reports showed that both sides were nearing a deal.

Spot gold rose 0.2 percent to $1,291.89 per ounce as of 0332 GMT. U.S. gold futures firmed 0.1 percent at $1,296.90 an ounce.

"One of the key issues would be the China-U.S. trade negotiations. There is a lot of optimism around the idea that we will see a peaceful resolution and some agreement really soon," said Michael McCarthy, chief market strategist, CMC Markets.

"However, if the trade talks drag out we could see further support for gold because of its implications for growth."

Gold is often seen as a safe investment during times of financial and political uncertainties.

A pause in the equities rally also helped the bullion. Asian shares held near an eight-month peak as investors awaited developments on trade talks.

Negotiations between the United States and China made "good headway" last week in Beijing and the two sides aim to bridge differences during talks this week, White House economic adviser Larry Kudlow said.

The dollar was trading near one-week low posted in the previous session after data showed U.S. services sector activity hit a more than 19-month low in March and private payrolls grew less than expected.

Market participants are now awaiting the U.S. nonfarm payrolls data, due on Friday, as it would offer insights on the strength of the U.S. economy.

A weak payrolls data could further weigh on the U.S. unit, making dollar denominated metals cheaper for investors holding other currencies.

Holdings in the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, also fell for a third consecutive session on Wednesday. Holdings were at their lowest level since Dec. 17 at 24.57 million ounces.

Among other precious metals, spot platinum rose the most in more-than-two-years in the previous session to touch its highest level since end-June 2018 at $879.03 an ounce.

The auto-catalyst metal was down 0.2 percent at $872.93 an ounce on Thursday, while its sister metal palladium was up 0.3 percent at $1,409.15.

Silver dipped 0.3 percent to $15.09 per ounce.

Source:https://www.moneycontrol.com/news/business/markets/gold-gains-as-dollar-eases-focus-on-us-china-talks-3760881.html

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International Market Update

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Sensex, Nifty open flat ahead of RBI meet; bank in focus

Market Opens: It is flat start for the Indian indices ahead of RBI policy meeting.

At 09:19 hrs IST, the Sensex is up 45.55 points at 38922.67, while Nifty is up 5 points at 11649. About 523 shares have advanced, 307 shares declined, and 52 shares are unchanged. 

Indiabullls Housing, Hero Motocorp, Titan, UltraTech Cement, L&T, Vedanta, Bharti Airtel, SRF, Godrej Agrovet are among major gainer, while losers are Wipro, HCL Tech, Zee Entertainment, UPL, BPCL, JSW Steel and Tata Steel.

On the sectoral front, except IT and metal, all other sectoral indices are trading in green.

Rupee Opens: The Indian rupee opened lower by 11 paise at 68.53 per dollar on Thursday versus 68.42 yesterday.

Source:https://www.moneycontrol.com/news/business/markets/market-live-sensex-nifty-open-flat-ahead-of-rbi-meet-bank-in-focus-3759791.html

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Opening Bell

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Closing Bell: Indices revert gains in late trade as Nifty ends below 11,650; BPCL down 4%

Market Close: Benchmark indices ended near day's low after Skymet predicts below normal monsoon due to developing El Nino.

Sensex and Nifty touched record high in the early trade today.

At close, the Sensex was down 179.53 points at 38877.12, while Nifty was down 69.20 points at 11,644. About 998 shares have advanced, 1574 shares declined, and 157 shares are unchanged 

BPCL, Zee Entertainment, IOC, SBI and GAIL were the top losers on the Nifty, while gainers were Indiabulls Housing, Maruti Suzuki, Bajaj Finserv, HCL Tech and JSW Steel.

All the sectoral indices ended in red led by PSU bank (down 2.5 percent) followed by pharma, infra, energy, IT, metal, auto and FMCG.

Source:https://www.moneycontrol.com/news/business/markets/closing-bell-indices-revert-gains-in-late-trade-as-nifty-ends-below-11650-bpcl-down-4-3751991.html

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Nifty hits record high: 10 stocks rallied 22-42% as index gained 1,160 pts

The optimism driven by increasing FII inflows helped Nifty50 to surpass its previous record high of 11,760.20 (touched in August 2018) on April 3 morning.

The index took 146 trading sessions to hit new record high of 11,761 on April 3. The rally actually started in February 2019, especially after opinion polls which indicated that ruling party can win 260-270 seats in general elections 2019.

FIIs have bought equity worth more than Rs 50,000 crore since February.

The Nifty50 has added 1,160 points and the BSE Sensex surged nearly 3,900 points since February 19, 2019.

The correction is over for the time being and the market is in uptrend. In fact, we are in a bull run started in 2013, though there were corrections in between. After September-October 2018 correction market nicely bounced back," Ramesh Damani, Member BSE said in an interview to CNBC-TV18.

Volatility is always associated with elections which come and go, the market is still in bull run and hope the Sensex will go above 40,000 and beyond soon, he added. However, as the market has rallied more than 10 percent and is at higher end of range, he would be cautious.

Among Nifty50, 46 stocks participated in the rally out of which top 30 stocks gained 10-42 percent.

Stocks that gained the maximum in last one-and-half-month are Indiabulls Housing Finance, Yes Bank, Hindustan Petroleum, Tata Motors and Indian Oil Corporation.

The stellar run was not restricted to benchmark indices only, in fact it spilled over to broader market as well which had underperformed since January 2018.

The Nifty Midcap index spiked nearly 14 percent and Smallcap index jumped 18 percent.

“Fresh highs were bound to happen as the force behind the trend looks intact for the further gains that may push Nifty to touch beyond 12K mark and Sensex beyond 39,500,” Mustafa Nadeem, CEO, Epic Research told Moneycontrol.

“Lower inflation, lower interest rate scenario, a dovish stance from Fed reserve and liquidity-driven markets, all these factors are favoring the current scenario,” he said.

The rally was across sectors with Nifty Bank, energy, financial service, infra, metal and realty gaining the most (12-20 percent). PSU Bank, the biggest underperformer due to NPA concerns, turned biggest gainer with 27 percent upside since February 19.

Source:https://www.moneycontrol.com/news/business/markets/nifty-hits-record-high-10-stocks-rallied-22-42-as-index-gained-1160-pts-3753061.html

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