After opening the day in red, share markets in India witnessed volatile trading activity throughout the day and ended the day on a weak note. Gains were seen across most sectors with stocks in the realty sector and stocks in the metal sector, leading the gains. While stocks in the banking sector lost the most.
At the closing bell, the BSE Sensex stood lower by 59 points (down 0.2%) and the NSE Nifty closed down by 19 points (down 0.2%). The BSE Mid Cap index ended the day up by 0.4%, while the BSE Small Cap index ended the day up by 0.8%.
Asian stock markets finished mixed. As of the most recent closing prices, the Hang Seng was down by 0.1% and the Shanghai Composite was down by 0.3%. The Nikkei 225 was up by 0.1%. European markets were trading flat. The FTSE 100 was down by 0.1%. The DAX was flat while the CAC 40 was down by 0.2%.
The rupee was trading at Rs 64.08 against the US$ in the afternoon session. Oil prices were trading at US$ 57.3 at the time of writing.
In news from the cryptocurrency space. Bitcoin's stellar rise has been hitting the headlines recently. However, its volatility is seldom talked about.
The price of bitcoin fell more than 10% today to as low as US $15,800 at a cryptocurrency exchange Bitstamp, as the rival currency - Bitcoin Cash was allowed to list on Coinbase, which is one of the biggest globlal crypto exchanges.
However, despite the drop, bitcoin price has since pared some of the losses and was down about 7% in early trade. The digital currency has been sliding since it had hit a record high of $19,666 on Sunday.
Bitcoin Volatile Despite Stellar Rise
Bitcoin and cryptocurrencies are a curious bunch. They have no central bank backing and have not yet been regulated. Yet they seem to have found favour among a large number of people, with demand for them growing every day. There are over 800 cryptocurrencies in existence today, with new ones being added to the list every day.
While the world of digital currencies is intriguing, it can get very confusing for the layman. Our very own, Ankit Shah, Research Analyst, has taken upon himself to study cryptocurrencies and help our readers understand them.
Here's Ankit in a recent edition of Equitymaster Insider:
- I've been studying and tracking bitcoin for a while, and though I still understand very little about it, I believe that it is a revolutionary technology that could transform a range of businesses and money itself. It would be naive to dismiss it as a passing fad.
I want my readers to be on top of the biggest megatrends in the global economy. So, you can expect to hear about bitcoin whenever there is an important update or insight. (I'm sure you know I'm also the editor of Vivek Kaul's Inner Circle and I have access to a wealth of economic insights from our global think-tank.)
Ankit has also released a premium guide for Equitymaster Insider subscribers, titled Bitcoin 101 which contains everything you need to know about bitcoins and other digital currencies.
If you haven't been receiving Ankit's insights, get on the Insider's list now.
Moving on to news from stocks in the telecom sector. Bharti Airtel share price ended the day on a dull note after the company's board approved an arrangement for takeover of consumer mobile business of Tata Teleservices, in a deal involving issue of equity and preference shares.
In October this year, the takeover of Tata Group's consumer mobile business by Airtel on a 'no-debt, no-cash basis' was announced by the two firms.
The Board also approved another scheme of arrangement between the listed entity Tata Teleservices Maharashtra (TTML) and Airtel and their respective shareholders and creditors.
Outlining the details, Airtel said the deal would entail demerger of consumer wireless business of Tata Teleservices (TTSL) to Airtel except Rajasthan circle, which is being demerged to subsidiary company Bharti Hexacom. Under the first scheme, Airtel will issue and allot 500 unlisted Redeemable Preference Shares (RPS) of face value of Rs 100 each to all equity shareholders of TTSL proportionate to their holding. It also includes Airtel allotting 10 unlisted RPS of Rs 100 face value each to all the Compulsory Convertible Preference Shares (CCPS) holders of TTSL, in proportion of their holding.
A similar arrangement has also been worked out between TTML and Airtel.
The entry of Reliance Jio and the fierce tariff war it has triggered has set off brisk activity in the telecom industry for fundraising and consolidation, as the incumbents look for ways and means to fend off the competition.
Telecom companies are straddled with high debt, intense competition, and lack of pricing power. High spectrum costs and regulatory issues have hampered the sector. While consumers have benefited from low costs and new players fighting for their share, investors have suffered.
The sector has been a classic 'value trap'. While it always looks cheap compared to other sectors, it has failed to provide any reasonable returns. We also believe the situation is unlikely to change in the near future. For an investor, it's important to differentiate between 'value' and 'value traps'.
Bharti Airtel share price closed the day down by 1.5%.
And here's a note from Profit Hunter:
DLF ltd is among the most active stock in the market today. Let's have a look at its chart.
After the stock topped out in January 2008 it traded in a downtrend. During this down move, it regularly found resistance from the falling trendline (red line) as seen in the chart below.
The stock bottomed out at 72 in February 2016 and rallied to find resistance from the falling trendline in August 2016. It fell lower from there but did not make a new low. Instead it resumed up and broke above the falling trendline in April 2017. This indicated that the stock has ended its 8-year downtrend and started a new uptrend.
The stock is now trading 60% higher from the trendline break-out level. Today, it is up 5% with healthy volumes and it has hit a new 52-week high.
So will the stock continue to trade in its uptrend and challenge its 2008 high? Let's keep a watch on it...
DLF at a New 52-Week High
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