Sensex Opens Marginally Lower; IndusInd Bank & Tata Steel Top Losers

Mon, 18 Jan 09:30 am | Yash Vora, TM Team

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Asian stock markets are trading on a mixed note today as disappointing news on US consumer spending dampened sentiment ahead of a closely-watched reading on the health of the Chinese economy.

China's gross domestic product (GDP) expanded 6.5% year-on-year (YoY) in the fourth quarter, data from the National Bureau of Statistics showed, quicker than the 6.1% forecast by economists in a Reuters poll, and followed 4.9% growth in the third quarter.

Also evident were doubts about how much of US President-elect Joe Biden's stimulus package will make it through Congress given Republican opposition, and the risk of more mob violence at his inauguration on Wednesday.

The Nikkei is trading lower by 0.8% while the Hang Seng reversed early losses and is presently trading up by 0.6%.

US stock markets closed on a negative note on Friday, with the three major indexes registering their largest one week drop since October 30, after President-elect Joe Biden announced a US$ 1.9 trillion Covid-19 relief plan late Thursday and investors assessed results from a trio of big banks.

The Dow Jones Industrial Average ended down by 0.6% while the tech heavy Nasdaq ended down by 0.9%.

Both indices registered weekly declines with the Dow off 0.9% and the Nasdaq losing 1.5%.

Back home, Indian share markets have opened the day on a negative note following the trend on SGX Nifty.

Market participants are tracking Mindtree share price and Rallis share price as these companies will release their Q3 numbers today.

The BSE Sensex is trading down by 63 points. Meanwhile, the NSE Nifty is trading lower by 38 points.

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HDFC Bank is among the top gainers today. Power Grid, on the other hand, is among the top losers today.

The BSE Mid Cap index has opened down by 0.5%. The BSE Small Cap index is trading lower by 0.2%.

Sectoral indices are trading mixed with stocks in the finance sector and banking sector witnessing buying interest.

Metal stocks and IT stocks are trading in red.

Shares of Tata Metalik and Indian Energy Exchange hit their 52-week highs today.

The rupee is trading at 73.17 against the US$.

Gold prices are trading down by 0.1% at Rs 48,632 per 10 grams.

To know more about gold, you can check out our detailed article on investing in gold here: How to Invest in Gold?

Speaking of stock markets, in his latest video for Fast Profits Daily, Vijay Bhambwani shares his top 3 Nifty and Sensex ETFs as well as the number one Bank Nifty ETF.

In of his prior videos, Vijay had also discussed about his top 5 gold ETFs. That video has been quite popular.

Tune in to the below video to find out which ETFs are best.

In latest developments from the IPO space, the Rs 46.3 billion IPO by Indian Railway Finance Corporation (IRFC) opened for subscription today.

This will be the first IPO in 2021. Indigo Paints is scheduled to launch its IPO in the latter part of the coming week.

IRFC targets to raise Rs 44.3 billion at a price band of Rs 25-26 per share. The company already garnered Rs 13.9 billion through anchor book on last Friday.

The net proceeds from its fresh issue are proposed to be utilised towards for augmenting equity capital base to meet future capital requirements arising out of growth in business and general corporate purposes.

How this IPO sails through remains to be seen. Meanwhile, we will keep you updated on the latest developments from this space.

In news from the banking sector, HDFC Bank is among the top buzzing stocks today.

India's largest private sector lender HDFC Bank on Saturday reported a 18.1% rise in its net profit for the December quarter to Rs 87.6 billion.

An average of estimates from five brokerages showed that the private lender may report net profit of Rs 76.3 billion.

The lender reported a growth 15.1% in its net interest income (NII) for the reported quarter to Rs 163.2 billion.

HDFC Bank's gross non-performing assets ratio for the quarter stood at 0.8%. The net non-performing assets ratio was at 0.09% as against 0.17% in the previous quarter.

The lender's advances grew 16% YoY in the December quarter to Rs 10.8 lakh crore, while deposits climbed 19% YoY to Rs 12.7 lakh crore.

HDFC Bank's credit cost in the quarter fell to 1.25% from 1.41%, a quarter ago.

Provisions and contingencies in the quarter were at Rs 34.1 billion as compared to Rs 30.4 billion in the corresponding quarter a year ago.

HDFC Bank also said it has imposed a penalty of Rs 10.20 lakh on its senior executive Jimmy Tata for selling his shares in violation of insider trading regulations.

Tata, the chief credit officer, sold 1,400 shares of the bank held by him in what the lender termed as an "inadvertent trade".

HDFC Bank share price has opened the day up by 1.8%.

Note that, HDFC Bank is one that has always adapted to changing times.

HDFC Bank wanted to transform itself from a leader in the physical banking to a leader in online banking. Since then, HDFC Bank has constantly focused on going digital.

In 2004, only 10% of customer transactions were initiated through internet and mobile. The number has gone up to 92% in 2019.

It is a great example of a company which has taken advantage of its scale and embraced disruption rather than fear it.

These are traits that one should look for in picking stocks. They not only withstand the disruption but also gain from it in the long-run.

Moving on to news from the finance sector, mortgage lender DHFL on Sunday said the Committee of Creditors (CoC) has approved resolution plan submitted by Piramal Capital and Housing Finance Limited, a Piramal Group company.

This was approved by the CoC in its 18th meeting concluded on January 15, 2021, DHFL said in a regulatory filing.

Piramal's bid received 94% votes as compared to 45% for the US-based Oaktree Capital.

Since the conclusion of the fifth and final round of the bidding process last month, Piramal and Oaktree Capital each claimed that their bid was the highest and fully implementable.

According to sources, suitors have submitted bids in the range of Rs 350-370 billion.

In November 2019, the Reserve Bank of India (RBI) referred Dewan Housing Finance (DHFL), the third-largest pure-play mortgage lender, to the National Company Law Tribunal (NCLT) for insolvency proceedings.

DHFL was the first finance company to be referred to NCLT by the RBI using special powers under Section 227 of the IBC.

DHFL share price has opened the day up by 5%.

To know what's moving the Indian stock markets today, check out the most recent share market updates here.

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