Sensex slides 464 points; NBFCs plunge, India VIX surges 11% on Friday

Benchmark indices Sensex and Nifty ended over 1 per cent lower on Friday, dragged by fall in blue-chip companies such as Reliance Industries (RIL), Infosys and YES Bank amid muted global cues. The S&P BSE Sensex ended 464 points or 1.33 per cent down at 34,316 while NSE’s Nifty50 index settled at 10,303.55, down 150 points or 1.43 per cent.

Among individual stocks, RIL dipped as much 7% to Rs 1,073 on the BSE in the intra-day trade after a mixed bag results for the quarter ended September 2018 (Q2FY19) with its retail and digital services (telecom; Jio) businesses continuing to post strong growth, while its core refining business performance was a bit disappointing amid high expectations. The stock ended at Rs 1,102 apiece on BSE, down 4 per cent.

YES Bank also dropped as much as 8 per cent in the intra-day trade on Friday after the Reserve Bank of India (RBI) on Wednesday once again rejected the lender’s request for extending the term of MD & CEO Rana Kapoor, and reaffirmed the February deadline for finding his successor. Shares of the lender ended at Rs 218, down 6 per cent.

Shares of non-banking financial companies (NBFCs), including housing finance companies (HFCs) and select private banks, are trading under pressure for the second straight day. Among stocks, Dewan Housing Finance Corporation (DHFL), Indiabulls Housing Finance and PNB Housing Finance slipped over 17% on Friday on concerns of overall credit growth due to the liquidity crisis.

IT shares traded weak with TCS hitting 3 month low, Infosys, HCL Tech down 4% each. The Trump administration has said it is coming out with new proposals to not only revise the definition of speciality occupations under H-1B visas, but also the definition of employment under this foreign work visa category which is popular among Indian companies, the PTI report suggested.

Thanks to rising crude oil prices and rupee depreciation, public sector oil and gas companies have seen heightened concerns on profitability, leading to a 7-19 per cent fall in their stock prices. The government’s recent decision asking the OMCs to absorb a part of retail price reduction (Rs 1 a litre impact on marketing margins of OMCs) has been looked by the street as a reversal of its stand on free pricing mechanism for petrol and diesel.

Shares of the mid-tier IT company Mindtree tumbled as much as 17.6 per cent in the intra-day trade on Friday after the company reported subdued revenue growth for the September quarter. The sentiment was also hit on the cautious macro commentary by the management. The IT firm on Wednesday posted a 65.4 per cent rise in its consolidated net profit at Rs 2.06 billion, on the back of sound growth in travel & hospitality and hi-tech & media verticals. However, it disappointed Street with muted constant-currency (CC) revenue growth of 2.4 per cent in a seasonally strong quarter.

Shares of cement companies were under pressure falling by up to 8% on the BSE in intra-day trade after ACC reported lower than expected operating performance for the quarter ended September 2018. ACC, UltraTech Cement and Ambuja Cement were down 3% to 8%, while Dalmia Bharat and Shree Cement hit their respective 52-week lows on the BSE.

Here are some picks from the week gone by.

Company: Jai Corp CMP: 104.60 Mastermind

Company: Dwarikesh Sugar CMP: 28.50 Mastermind

Company: Jet Airways CMP: 226.50 Mastermind

Company: Punjab National Bank CMP: 66.15 Mastermind

Company: GAIL India CMP: 343.80 Mastermind

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