Sensex Opens in Green; Energy and IT Stocks Lead

Thu, 18 Feb 09:30 am

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Asian share markets are trading on a mixed note today with Chinese shares rising in the first trading session after the week-long Lunar New Year holiday amid renewed optimism for an acceleration in global growth.

The Nikkei is trading higher by 0.2% while the Hang Seng is trading down by 1.5%. The Shanghai Composite is up 0.4%.

In US stock markets, technology stocks faced some pressure on inflation concerns, driving down the Nasdaq while other companies rose on broader economic optimism.

The Dow Jones Industrial Average rose 0.3% while the Nasdaq dropped 0.6%.

Back home, Indian share markets have opened the day on a positive note.

Market participants are tracking Ambuja Cements share price as the company is slated to announce its December quarter earnings later today.

The BSE Sensex is trading up by 76 points. Meanwhile, the NSE Nifty is trading higher by 35 points.

ONGC is among the top gainers today. ICICI Bank, on the other hand, is among the top losers today.

The BSE Mid Cap index has opened up by 0.4%. The BSE Small Cap index is trading higher by 0.9%.

Sectoral indices are trading mixed with stocks in the energy sector and IT sector witnessing buying interest.

Healthcare stocks and banking stocks, on the other hand, are trading in red.

Shares of GIC Housing and Tejas Networks hit their 52-week highs today.

The rupee is trading at 72.77 against the US$.

Gold prices are trading up by 0.4% at Rs 46,425 per 10 grams.

Speaking of the current stock market scenario, note that Indian share markets have continued their upward trend since Union Budget 2021-22 which was announced on February 1.

Better than expected Q3FY21 earnings, contained Covid-19 infections, Budget boost, and economic revival are the top factors behind the rally.

The BSE Sensex crossed the 52,000-mark earlier this week on Monday for the first time. Sensex's P/E ratio is at a two decade high of 36x.

Have a look at the chart below which shows Sensex P/E over the years.

So, should Sensex valuations at nearly two-decade high be a reason for you to abandon stock picking?

Here's what Tanushree Banerjee wrote about it in a recent edition of Profit Hunter:

• Sensex at 52,000 or higher should not change the way you buy stocks.
  
  You must look for only the most solid businesses that can confront all odds.
  
  And you must not compromise on margin of safety in valuations.
  
  A solid wealth building plan needs thorough research. You will also need a commitment to consistently invest in a few great stocks at the right times.
  
  There may be very few such stocks that are actionable but ones that do qualify could be your starting point.

In an upcoming special online event - The Great Indian Wealth Project - Tanushree will show you how to potentially accumulate Rs 7 crore in wealth, over the long-term.

You can sign up for free here.

In news from the finance sector, the Reserve Bank of India (RBI) on Wednesday came out with a slew of directions related to maintenance of liquidity coverage ratio, risk management, asset classification and loan-to-value ratio, among others, for housing finance companies (HFCs).

The central bank said these directions, which shall come into force with an immediate effect, are aimed at preventing the affairs of any HFCs from being conducted in a manner detrimental to the interest of investors and depositor.

All non-deposit taking HFCs with asset size of Rs 1 billion and above and all deposit taking HFCs (irrespective of asset size) shall pursue liquidity risk management, which inter alia should cover adherence to gap limits, making use of liquidity risk monitoring tools and adoption of stock approach to liquidity risk, the RBI said.

The RBI said HFCs shall maintain a liquidity buffer in terms of liquidity coverage ratio (LCR), which will promote their resilience to potential liquidity disruptions by ensuring that they have sufficient high-quality liquid asset (HQLA) to survive any acute liquidity stress scenario lasting for 30 days.

All non-deposit taking HFCs with an asset size of Rs 100 billion and above, and all deposit taking HFCs irrespective of their asset size will have to achieve a minimum LCR of 50% by December 1, 2021 and gradually to 100% by December 1, 2025.

The central bank also prevented HFCs to accept or renew public deposit unless it has obtained a minimum investment grade rating for fixed deposits from any one of the approved credit rating agencies, at least once a year.

How the above developments pan out remains to be seen. Meanwhile, we will keep you updated on the latest developments from this space.

Speaking of stock markets, in his latest video for Fast Profits Daily, Brijesh Bhatia talks about why smallcap stocks will outperform the Nifty 50 index and for how long such outperformance could last.

As per Brijesh, the smallcap rally has only just begun. Tune in to the video below to find out more:

Moving on to stock specific news...

Bharti Airtel is among the top buzzing stocks today.

Bharti Airtel on Wednesday said it will acquire 20% stake in its DTH arm Bharti Telemedia from an affiliate of Warburg Pincus for about Rs 31.3 billion.

The Warburg Pincus affiliate had acquired 20% equity stake in Bharti Telemedia in 2018 after the announcement of the deal in December 2017.

The transaction will be discharged primarily via issuance of about 36.4 million equity shares of Bharti Airtel at a price of Rs 600 per share and up to Rs 10.4 billion in cash, Bharti Airtel said in a statement.

Airtel, which is locked in a fierce competition with Reliance Jio, aims to align the ownership of its consumer-facing businesses, with the Warburg Pincus transaction.

The telecom operator also initiated the first step to unlock the value of its digital businesses by setting up a special committee of its board of directors.

Airtel said the committee would evaluate various options for the re-organisation of businesses and shareholding structure of the company and its various subsidiaries to achieve the required flexibility and sharper focus on digital and non-telecom businesses.

Separately, the Sunil Mittal-led company is looking to scale up and monetise its digital businesses, which include music streaming app Wynk, content platform Xstream, cloud-based communication platform Airtel IQ, among others.

Bharti Airtel share price has opened the day up by 0.5%.

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

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

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INDICESBSE (Rs 0 to 1)BSE (Rs 1 to 2)BSE (Rs 2 to 4)BSE (Rs 4 to 10)BSE (Rs 10 to 20)BSE (Above Rs 20)BSE - AllBSE-30BSE-100BSE-200BSE-500BSE AutoBSE BankexBSE Capital GoodsBSE Consumer DurablesBSE FMCGBSE HealthcareBSE ITBSE MetalBSE Oil & GasBSE PSUBSE TeckBSE RealtyBSE PowerBSE A GroupBSE B GroupBSE Mid-CapBSE Small-CapBSE Basic MaterialsBSE Consumer DiscretionaryBSE IndustrialsBSE UtilitiesBSE Sensex 50BSE Sensex Next 50BSE Bharat 22BSE 150 MidCapBSE 250 SmallCapBSE 250 LargeMidCapBSE 400 MidSmallCapBSE AllCapBSE LargeCapBSE SmallCap SelectBSE 100 LargeCap TMCBSE InfraBSE ManufacturingBSE CPSEBSE Private BankBSE Diversified FinancialsBSE MomentumBSE Low VolatilityBSE QualityBSE Enhanced ValueBSE Divident StabilityS&P BSE IPOBSE SMEIPOBSE 100 ESGBSE CarbonexBSE GreenexNSE (Rs 0 to 10)NSE (Rs 10 to 20)NSE (Above Rs 20)NSE - AllNSE-50NSE ITNSE Nifty Midcap 50NSE JR. NiftyNSE Bank NiftyNIFTY Next 50NIFTY 100NIFTY 200NIFTY 500NIFTY MidCap 100NIFTY SmallCap 250NIFTY SmallCap 50NIFTY SmallCap 100NIFTY LargeMidCap 250NIFTY MidSmallCap 400NIFTY AutoNIFTY Consumer DurablesNIFTY FinanceNIFTY FMCGNIFTY MediaNIFTY MetalNIFTY PharmaNIFTY Private BankNIFTY PSU BankNIFTY RealtyNIFTY Oil & GasNIFTY SME EmergeNIFTY CommoditiesNIFTY CPSENIFTY EnergyNIFTY India ConsumptionNIFTY InfraNIFTY MNCNIFTY PSENIFTY Serv SectorNIFTY100 Liquid 15NIFTY Midcap Liquid 15NIFTY Midcap 150 Quality 50NIFTY50 Equal WeightNIFTY100 Equal WeightNIFTY100 Low Volatility 30NIFTY100 Alpha 30NIFTY Alpha 50NIFTY Dividend Opportunities 50NIFTY High Beta 50NIFTY Low Volatility 50NIFTY200 Quality 30NIFTY 500 Value 50NIFTY 100 Quality 30SECTORSAgricultureAirlinesAluminiumAsset Management CompaniesAutomobilesAuto AncillariesBanks (Private)Banks (PSU)BankingCementChemicalsDefenceDiagnosticsDronesEngineeringElectric VehicleElectric Vehicle BatteryEnergy SourcesESGEthanolFertilizersFintechFMCGFoodGreen HydrogenHotelsInfrastructureInsuranceInvestment and FinanceInvITIT (Large)IT (Others)LogisticsMediaMetalMiningIndia's Big Tech StocksIndian PharmaMNC PharmaPSUPaintPaperPlasticPowerRating AgenciesReal EstateREITsRenewable EnergyRetailingSemiconductorShippingSteelSugarSupply ChainTelecomTextilesTravel Support Services

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