Nifty IT trades at a 16-year high with most TI shares at multi-year highs
Opening Bell: Sensex, Nifty Opens Higher Led by TI Stocks; TCS increases 4% after second quarter results
Indian stocks opened higher on Thursday led by gains in TI stocks after TCS, the top sector, beat Street’s estimates in the September quarter. The top 5 winners of the Nifty50 index came from the IT space. TCS gained the most, 4 percent, followed by Wipro, Tech Mahindra, HCL Tech and Infosys, who all gained 2.5 to 4 percent. Meanwhile, Asian Paints, RIL, Bajaj Auto, Adani Ports and Nestlé led the losses. At 9:18 a.m., the Sensex was trading 374 points higher at 40,253 while the Nifty was up 91 points at 11,830. The broader markets were also in the green with the mid-cap and small-cap indices rising 0.6 percent and 0.9 percent, respectively.
TCS Q2 Exceeds Street Expectations; the board approves the share buyback
TI leader TCS has reported its steady net profit for the second quarter of the fiscal year at Rs 7,475 crore versus a CNBC-TV18 survey of Rs 6,744 crore, thus beating street expectations. Revenues in rupees have reached Rs 40,135 crore against an estimate of Rs 39,330 crore, thus outperforming the street by 2 percent. EBIT (earnings before interest and taxes) has been reported at Rs 10,515 crore, which is 9.2 percent higher than analysts expected. The company posted steady growth in foreign exchange income of 4.8 percent in the quarter. Dollar revenue has been reported at $ 5.424 million for the past quarter. The TCS board also approved a share buyback of up to Rs 16 billion at Rs 3,000 per share.
Should one buy Vedanta in this panic or exit? What Prakash Diwan has to say
Vedanta shares fell sharply in trading amid reports that some institutional investors were bidding at a low price. In an interview with CNBC-TV18, market expert Prakash Diwan said that there is an arbitrage opportunity available in Vedanta shares, but it carries the risk that one or more institutional investors may skew the results of the buyback offer. Watch the video for more information.
Some more global signals to watch this morning:
No rate cut, but revamped RBI MPC may give fiscal year 21 GDP forecast on Oct 9: CNBC-TV18 survey
The renewed Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) can finally publish a GDP forecast for the fiscal, which the main bank has refrained from giving since the outbreak of the pandemic. Most of the 10 economists polled by CNBC-TV18 said the central bank would have to put a figure on its growth outlook in October policy. “For the year 2020-21 as a whole, real GDP growth is also estimated to be negative,” Governor Shaktikanta Das said during the previous policy announcement on August 6. Fifty percent of those surveyed believe that the RBI will forecast an 8 to 10 percent GDP contraction for fiscal year 21, while 20 percent believe that the central bank may project a more pronounced contraction. Nine out of ten economists surveyed said the RBI’s CPI estimate for March 2021 will be above the MPC’s target of 4 percent. This is largely a fact, now that retail inflation has been trending above the committee’s tolerance band for 5 consecutive months. More here
First, here is a quick update on what happened in the markets on Wednesday
Indian indices ended for a fifth day on Wednesday led by gains at Reliance Industries after the Abu Dhabi Investment Authority said it will invest Rs 5,512.50 crore in Reliance Retail Ventures. Other heavyweights Titan, HUL, Maruti and M&M also contributed to the benchmarks. Surprisingly, the broader markets ended lower compared to the benchmark indices. Nifty Auto was the best performing index for the day, up more than 1%, while Nifty Media closed 2% lower.
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