Key equity barometers ended with minor gains on Friday, mirroring gains in other Asian stock markets following reports that the United States and China are getting close to an interim trade pact.

The barometer index, the BSE Sensex, rose 70.21 points or 0.17% to close at a 40,356.69. The Nifty 50 index rose 23.20 points or 0.20% to close at a 11,895.30.

The Nifty jumped over 100 points in the morning trade to hit a high of 11,973.65, supported by firmness in banks shares. However, profit selling in the last one hour of the trade dragged the index below 11,900 level.

In the broader market, the S&P BSE Mid-Cap index rose 0.63% while the S&P BSE Small-Cap index fell 0.13%.

The market breadth was negative. On the BSE, 1140 shares rose and 1461 shares fell. A total of 163 shares were unchanged.

Crude & Currency:

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 71.805, compared with its close of 71.965 during the previous trading session.

In the commodities market, Brent crude for January 2020 settlement was down 54 cents at $61.74 a barrel. The contract fell 9 cents or 0.14% to settle at $62.28 a barrel during the previous trading session.

Foreign Markets:

Shares in Europe and Asia edged higher on Friday, as investors digested recent developments on US-China trade.

White House economic adviser Larry Kudlow said negotiations over the first phase of a trade agreement with China were coming down to the final stages, with the two sides in close contact.

The US stock market finished session mixed on Thursday, 14 November 2019, as risk sentiments subdued amid mixed global economic data.

In economic news, US initial jobless claims climbed to 225,000, an increase of 14,000 from the previous week's unrevised level of 211,000, a report released by the Labor Department on Thursday showed.

The Labor Department released a report on Thursday showing US producer prices rebounded by 0.4% in October after falling by 0.3% in September. The bigger than expected increase in producer prices came amid a substantial rebound in energy prices, which surged up by 2.8% in October after tumbling by 2.5% in each of the two previous months. Excluding food and energy prices, core producer prices still rose by 0.3% in October as against an expectation of 0.2% and following a 0.3% drop in September.

Buzzing Sectors:

The Nifty Bank index rose 0.87% to 31,016.50, rising for second straight session. The index is up 1.56% in two session from its recent closing low of 30,541.55 on 13 November 2019.

Public sector banks rallied after the Supreme Court (SC) on Friday said the National Company Law Appellate Tribunal (NCLAT) should not interfere with the decisions of the committee of creditors (CoC) in the Essar Steel insolvency case. Accordingly, SC gave more weightage to the financial creditors.

The SC decision overruled NCLAT's judgment dated 5 July 2019 that operational creditors should be treated on a par with financial creditors for distribution of funds from ArcelorMittal's bid in the Essar Steel insolvency case. The verdict paves the way for Arcelor's takeover of the bankrupt company.

Corporation Bank (up 17.2%), State Bank of India (up 5.19%), Bank of India (up 4.68%), IDBI Bank (up 3.30%), Canara Bank (up 2.92%), Punjab National Bank (up 2.65%) and Bank of Baroda (up 1.07%) advanced.

Union Bank of India rose 2.20%. The bank reported net loss of Rs 1,193.61 crore in Q2 September 2019 compared with net profit of Rs 139.03 crore in Q2 September 2018. Total income rose 11.84% to Rs 10,556.57 crore in Q2 September 2019 over Q2 September 2018. The result came after trading hours yesterday, 14 November 2019.

Private sector banks were mixed. City Union Bank (up 2.27%), Kotak Mahindra Bank (up 1.60%), ICICI Bank (up 0.11%) and Axis Bank (up 0.10%), advanced. RBL Bank (down 0.03%), Yes Bank (down 0.07%), Federal Bank (down 0.35%) and IndusInd Bank (down 1.08%) declined.

HDFC Bank rose 0.36% to Rs 1278.30. The stock reclaimed the record high level of Rs 1285 in intraday today.

Telecom stocks bounced back today amid hopes that the government would step in to help the ailing sector. The Supreme Court (SC) judgment on 24 October on the adjusted gross revenue (AGR) significantly impacted the financial stability of telecom companies. SC provided the company a 90 days time to pay the amount and report compliance.

Vodafone Idea surged 24.75% to Rs 3.68. The stock tumbled 11.53% to hit the day's low of Rs 2.61 in morning trade amid dismal Q2 results announced after market hours on Thursday.

On consolidated basis, the company reported a net loss of Rs 50,921.9 crore in Q2 September 2019 as against a net loss of Rs 4973 crore in Q2 September 2018. It reported a 41.8% rise in net sales to Rs 10840.20 crore on a YoY basis.

Consequent to the SC judgement, Vodafone Idea accounted for the estimated liability of Rs 27,610 crore related to license fee and Rs 16,540 crore related to spectrum usage charges up to 30 September 2019 including the interest, penalty and interest thereon of Rs 33,010 crore.

Gross debt as of 30 September 2019 was Rs 1,17,300 crore, including deferred spectrum payment obligations due to the government of Rs 89,170 crore, but excluding lease liabilities. Cash & cash equivalents were Rs 15,390 crore and net debt Rs 1,01,910 crore (vs Rs 99,260 crore in Q1FY20).

Bharti Airtel jumped 8.42% to Rs 393.20. The stock fell 2.27% to hit the day's low of Rs 354.40 in morning trade after weak Q2 results.

Bharti Airtel reported consolidated net loss of Rs 23,044.90 crore in Q2 September 2019 compared with net profit of Rs 118.80 crore in Q2 September 2018. Total revenues rose 4.9% to Rs 21,131 crore in Q2 September 2019 from Rs 20,148 in Q2 September 2018.

The company is hopeful of relief and in the absence of the same, has provided for an additional amount aggregating Rs 28,450 crore as a charge for the quarter (comprising of principal of Rs 6,164 crore, interest of Rs 12,219 crore, penalty of Rs 3,760 crore, and interest on penalty of Rs 6,307 crore) with respect to the license feeas estimated based on the Court Judgement and spectrum usage charges (SUC) as estimated based on the definition of AGR.

Thus the liabilities/provisions as at 30 September 2019 aggregate Rs 34,260crore (comprising of principal of Rs 8,747 crore, interest of Rs 15,446 crore, penalty of Rs 3,760 crore and interest on penalty of Rs 6,307 crore).

Stocks in Spotlight:

ONGC slipped 0.51% to Rs 135.55. The company reported 36.21% fall in consolidated net profit to Rs 5,275.51 crore on 11.19% fall in total income to Rs 103,237.18 crore in Q2 September 2019 over in Q2 September 2018. The result was announced after market hours yesterday, 14 November 2019.

The company's total crude oil production stood at 5.842 MMT in Q2 September 2019, down by 3.9% from 6.078 MMT in Q2 September 2018. Total gas production fell 1.6% to 6.265 BCM while the value added products fell 8.3% to 853 KT in Q2 September 2019 over Q2 September 2018.

Vedanta declined 1.29%. As per media reports, the company has lowered the capex guidance by $200 million to $1.2 billion for the financial year ending March 2020 with an optionality to spill into the next fiscal.

Steel Authority of India fell 2.55%. The steel maker reported a net loss of Rs 248.08 crore in Q2 September 2019 as against a net profit of Rs 609.76 crore in Q2 September 2018. Total income slumped 15.56% to Rs 14128.96 crore in Q2 September 2019 over Q2 September 2018.

MOIL declined 5.26%. The manganese-ore mining company reported 15.72% fall in consolidated net profit to Rs 8,859.21 crore after revenue from operations fell 29.25% to Rs 25,311.37 crore in Q2 September 2019 over Q2 September 2018.

The reduction in the company's turnover and profit during the current reporting period is mainly due to changes in product mix containing higher proportion of medium and low grade ore available for sale as compared with corresponding quarter and fall in prices of manganese ore in international market, resulting in price correction by MOIL

Divi's Laboratories jumped 5.44% after the USFDA successfully completed cGMP inspection of company's Unit-I facility at Lingojigudem in Telangana. The company received zero 483 observations from USFDA. The inspection was carried out from 11 November 2019 to 15 November 2019.

Balkrishna Industries rose 4.86%. The company reported 31% jump in profit after tax to Rs 291 crore in Q2 September 2019 from Rs 222 crore in Q2 September 2018. Total income of the company, however, fell 19% to Rs 1107 crore in Q2 September 2019 from Rs 1370 crore in Q2 September 2018. The company has written-off tax expenses to the tune of Rs 35 crore in Q2 September 2019 as against a tax expense of Rs 116 crore in Q2 September 2018.

Glenmark Pharmaceuticals advanced 6.70% after reporting consolidated net profit of Rs 255.54 crore in Q2 September 2019 as against net profit of Rs 414 crore in Q2 September 2018. The net profit is not comparable to the previous corresponding quarter on account of an exceptional income of Rs 167.18 crore recorded in the second quarter of the previous financial year. Consolidated revenues rose 9.05% to Rs 2815.04 crore in Q2 September 2019 from Rs 2581.33 crore in Q2 September 2018.

Prime Focus was locked in a lower circuit of 20% at Rs 67.35 after company's subsidiary in United Kingdom, DNEG Plc, decided to postpone its initial public offering due to on-going market uncertainty. Earlier, DNEG announced it will go public on 15 October 2019.

GIC Housing Finance fell 2.23%. The company said it received show cause notice from National Housing Bank (NHB) in connection with the inspection carried out for Financial Year 2017-18. Based on inspection and reply submitted by Company, NHB has directed the company to pay a penalty of Rs 15,000 (plus GST) which has been paid by the company.

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