Share Market Highlights: Sensex closes 665 points up, Nifty above 10,800; Axis Bank, Tata Motors shares rally

Things You Must Know Before Union Budget 2019: The growing discontent among the farming community has led to many protests and suicides in the recent past. The sluggish agricultural growth combined with rising cost of living in rural areas has made the life of rural folks miserable. Therefore, the government is required to take concrete steps to address the issue. The Modi government is expected to announce a relief package for farmers, similar to Rythu Bandhu Scheme-based Telangana Model, in the upcoming budget. Any such scheme to support income would be better than a loan waiver, provided it is introduced as a centrally-sponsored scheme, says a report by India Ratings and Research.

Also read: Budget 2019: Income support, not loan waiver, is the solution to rural distress, says India Ratings

The domestic stock markets --Sensex and Nifty--extended gains in the afternoon trade on Thursday. The Sensex is up 504 points to 36,095.82 while the Nifty is trading above the 10,750-mark. Infosys shares gained more than 3.46% to Rs 750.80, while Kotak Mahindra Bank shares are trading 2.5% higher at Rs 1,252.80.  A look at LIVE Sensex heatmap.

With interim Budget 2019 just a day away, expectations from stock market experts include DDT relief, income tax slabs adjustment and benefits for mutual fund investors under Section 54EE. Notably, experts point out that while there is a case for scrapping either the STT or the LTCG tax, any such move will come as a positive surprise. “So far as stock markets are concerned, the FM is expected to touch few things, and one among them is LTCG tax. LTCG tax on equities is certainly here to stay and I do not expect it to be abolished. However, the threshold limit might be increased,” Milan Vaishnav, CMT, MSTA, Consulting Technical Analyst at Gemstone Equity Research & Advisory Services told Financial Express Online.

Also read: Stock Market Budget 2019 Expectations: DDT relief, mutual fund benefits, tax slab changes on anvil

With the Budget day nearing close amid speculations of populist announcements, the stock market is “expected to remain highly volatile” and will keep a close eye on decisions taken by the Narendra Modi government in their final few months before the country goes to polls. The pressure, built up since last August, with Nifty 50 struggling to sustain above the 11,000-mark, is expected to expand further due to the budget season and the upcoming Lok Sabha election. “Markets are expected to remain highly volatile in the near term on account of the Union Budget 2019,” Sahaj Agrawal of Kotak Securities Ltd said in a note, adding that the broader range for Nifty 50 is expected to be around 10,400-11,000.

Also read: Budget 2019 is near; stock market expected to be volatile, here’s when you should buy

Shares of India’s largest private sector lender ICICI Bank rallied in trade on Thursday, after the indictment of former boss Chanda Kochhar in Videocon loan case. ICICI Bank shares gained more than 2.5% to Rs 373.50 on NSE this morning. In the latest quarter, while the firm has reported a 2.7% on-year fall in net profit to Rs 1,604.90 crore, the firm’s slippages came in at a 14-quarter low, and net interest margins improved to its best in seven quarters. Taking stock of the reported results, Axis Capital said that Q3 results indicate that the financial performance are showing signs of stabilisation. The current valuation offers decent risk-reward. The domestic book share gain should help achieve 15% ROE in next two years. Axis Capital has a share price target of Rs 500 on the stock. 

Also read: ICICI Bank shares zoom 2.5% after strong q3 results

DHFL share price fell 17 per cent to Rs 134 in early trade Thursday after government launched probe into Rs 31,000 crore fund diversion allegations, news agency Reuters reported citing unidentified sources. The investigation will be carried out by Ministry of Corporate Affairs (MCA) on the accusation launched against the company by a news portal, the news agency added. The media report claimed that DHFL diverted funds to the shell companies to purchase assets and the firms related with the company’s controlling shareholders made political beyond mandated levels.

Read full story here: DHFL share price falls 17% after government launches probe in Rs 31,000 crore fraud allegations

Shares of India's largest private sector lender ICICI Bank rallied in trade on Thursday, after the firm reported strong Q3 results for the October-December quarter. ICICI Bank shares gained more than 2.5% to Rs 373.50 on NSE this morning. The gross non performing assets (NPAs) of the bank reduced by 5.3% (QoQ) to Rs 51,591.5 crore from Rs 54,489 crore. Similarly, net NPA reduced by 26.4% (QoQ) from Rs 22,085.7 crore to Rs 16,252.4 crore. The provisions and contingencies surged 18.89% to Rs 4,244.15 crore during the quarter under review against Rs 3,569.56 crore in the corresponding quarter last year.  CASA deposits rose 15 per cent YoY to Rs 2,99,374 crore at December 31.

Also read: ICICI Bank Q3 net profit falls 2.7% on year to Rs 1,605 crore: key figures in nutshell

The much-awaited package for farmers to be unveiled in the interim Budget on Friday may involve transfer of Rs 12,000/year (Rs 6,000 each for the winter and summer crops) to all ‘small and marginal farmer households,’ an official source told FE. The transfer won’t be on a per-acre basis as under Telangana’s Rythu Bandhu scheme, but a flat amount would be given to all the identified beneficiaries as under Odisha’s recently launched Kalia scheme, the source said, without elaborating on the selection criteria and process.

Also read: Budget 2019: Government mulls Rs 12,000 annual cash transfer to 12 crore farmers

Rupee on Thursday opened 20 paise higher against the US dollar ahead of budget 2019 and US Fed’s indication that monetary policy tightening nears an end.  Rupee opened the day at 70.92 and hit a high and a low of 70.86 and 70.94 a dollar, respectively. The domestic currency closed at 71.12 against the greenback Wednesday. Currency experts expect that the fiscal deficit figure for December would decide the rupee movement going ahead. The upcoming budget will hold a major impact on the domestic currency, they added.

Read full story here: Rupee opens 20 paise higher today; budget in focus

The offer-for-sale by (Larsen & Toubro) L&T Technology Services will open for the retail category Thursday. The two-day OFS that opened for bidding yesterday received bids for 57 per cent for the non-retail category. L&T plans to sell 30 lakh shares in L&T Technology, representing 2.89 per cent of the total paid-up equity share capital, at a floor price of Rs 1,610. In case of oversubscription, the company plans to sell further 2.49 per cent stake through green shoe option.

Also read: L&T Tech OFS: Retail investors can bid today; key things to know

The domestic stock markets --Sensex and Nifty--opened  higher tracking positive global cues on Thursday morning. The Sensex is up 204 points to 35,796.11, while the Nifty is trading near the 10,700-mark. ICICI Bank shares gained by more than 2.7% to hit the day’s high at Rs 373.50, after the private sector lender reported strong Q3 results. For ICICI Bank, slippages came in lowest in 14 quarters, with Net Interest Margin coming in best in seven quarters. Tata Steel share price gained by nearly 2% to Rs 477. A look at Sensex live Heatmap.

In last three years, central government PSUs have spent more money as capital expenditure than that is spent by the central government through budget. Budget 2019: Government-owned companies have consistently outpaced the Union government in capital expenditure, becoming a major driving force for the economy. In the last three years, capital expenditure by central public sector undertakings was 40-60% higher compared with the amount spent by the government.

Also read: Budget 2019: PSUs drive capital expenditure as government takes a back seat

Gold prices on Thursday held near eight-month highs hit in the previous session after the U.S. Federal Reserve signalled a potential end to its monetary tightening cycle, and the bullion was heading for its fourth straight monthly gain. Spot gold was steady at $1,319.87 per ounce by 0042 GMT. Prices rose to their highest since May 11 at $1,323.34 on Wednesday. U.S. gold futures were up 0.7 percent at $1,319.30 per ounce.

Also read: Gold near 8-month highs on Fed rate pause, eyes 4th monthly

Asia stocks rose to a four-month high on Thursday, tracking Wall Street, after the Federal Reserve pledged to be patient with further interest rate hikes, signalling a potential end to its tightening cycle amid signs of slowing global growth. The dollar struggled near a three-week trough against its major peers and U.S. Treasury yields were significantly lower as investors reacted to the Fed’s change in tone. MSCI’s broadest index of Asia-Pacific shares outside Japan rose to its highest since Oct. 4 and was last up 0.4 percent. Japan’s Nikkei rose 1.4 percent. Australian stocks added 0.4 percent, while South Korea’s KOSPI advanced 0.7 percent.

Also read: Asia stocks hit 4-month high AS Fed turns more cautious; dollar sags

Jet Airways promoter-chairman Naresh Goyal is understood to have approached the Adani Group with a proposal to invest in his ailing airline, which is in dire need of funds. As is known, Jet was earlier in talks with Tata Group but it seems the talks did not lead to any concrete result with the latter keen on investing only if Goyal relinquished his control over the carrier. FE could not not confirm with the Adani Group if it has been approached by the Jet promoters with a bailout plan.

Read full story here: Jet Airways may turn to Adani Group for investment

U.S. oil prices edged up on Thursday to extend gains into a third session, with widely watched data showing signs of tightening supply in the United States. U.S. West Texas Intermediate (WTI) crude futures were at $54.41 per barrel at 0052 GMT, up 19 cents from their last settlement. WTI futures closed up 1.7 percent on Wednesday, when prices touched their highest since Nov. 21 at $54.93 a barrel. International Brent crude oil futures had yet to trade, after closing up 2.2 percent in the previous session. “Oil prices rallied after the (Energy Information Administration) weekly report showed crude stockpiles rose less than expected,” said Edward Moya, market analyst at OANDA. “U.S. stockpiles may continue to fall as Saudi Arabia continues to trim exports to the U.S.”

Also read: Oil extends gains into third session amid tighter US supply