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Stocks with High Owner Earnings
Various measures are used to assess the value of a company, such as earning per share (EPS), earnings yield, free cash flow, enterprise value and so on. A lesser-used measure is ‘owner’s earnings’ (OE), or more aptly, ‘owner-cash flow’ which Warren Buffett has referred to sometimes. In India, famous investor Sanjay Bakshi has often encouraged his readers to look at this measure which is...
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Nifty, Sensex may pause for breath – Weekly closing report
We had mentioned in last week’s closing report that Nifty, Sensex continued to be range-bound. The major indices of the Indian stock markets rallied during the week and closed with a gain of over 2% during the week. The trends of the major indices in the course of the week’s trading are given in the table below:
 
 
Indian equity markets surged on Tuesday (the market was closed on Monday on account of Holi), tracking positive state election results for ruling party at the Centre. Bearish USD/INR futures prices also supported the firm sentiments of the markets. Almost all sector stocks traded with firm sentiments tracking over all buying activities in Indian equity markets. On the NSE, there were 944 advances, 523 declines and 75 unchanged. On the BSE, there were 1,703 advances, 1,124 declines and 218 unchanged.
 
India's annual rate of inflation based on wholesale prices rose to 6.55% in February 2017 from 5.25% in the previous month, official data showed on Tuesday. According to the Wholesale Price Index (WPI) data released by the Commerce and Industry Ministry, the annual inflation rate was (-)0.85%  in February 2016. A rise in inflation could divert some fixed income investments into the stock markets and show higher trading volumes over a period of time.
 
US stocks wavered and ended mixed, as Wall Street mainly awaited a possible interest rate hike from the US Federal Reserve on Wednesday. Traders generally anticipated the Federal Open Market Committee to raise interest rates at the conclusion of its two-day monetary policy meeting later this week. Market expectations for a March rate hike were around 95.2%, according to the CME Group's FedWatch tool. A rise in interest rates could divert some funds of foreign institutional investors from India to developed countries.
 
Selling pressure in IT (information technology) and Teck (technology, media and entertainment) stocks, coupled with disappointing macro-economic data pulled the Indian equity markets lower on Wednesday. Besides, investors were cautious ahead of the US Federal Open Market Committee's meet later in the evening on whether or not to raise interest rates. However, the rupee was strong. On the NSE, there were 790 advances, 661 declines and 63 unchanged. On the BSE, there were 1,426 advances, 1,384 declines and 187 unchanged.
 
Asia's oldest bourse BSE on Tuesday launched futures on S&P BSE Sensex 50 index which will help investors to achieve portfolio diversification. "The market participants would be able to take a long-term view on the underlying. Introduction of additional indices will also lead to increased participation in the index futures market," it said in a statement. The index is designed to measure the performance of the top 50 largest and liquid stocks in the exchange's Large and Mid Cap by float-adjusted market capitalisation. Further, index futures contracts will lead to better price discovery and will be useful in hedging and risk management tools. According to the exchange, it will also take market towards a multi-product environment. "The index is diversified index as it represents each key economic sector identified by bourse's sector model covering approximately 53.9% of total market capitalisation of the exchange listed companies as of October 30, 2016," it added.
 
Positive global cues, a strong rupee and healthy buying in metals, capital goods and consumer durables stocks, brought a cheer to the Indian equity markets on Thursday. The key indices closed with gains of more half a per cent each, well absorbing the 25 basis points (bps) rate hike by the US Federal Reserve on Wednesday for the second time in three months.  The Indian economy is strong enough to absorb the impact of the US Federal Reserve's interest rate hike, the government said on Thursday. 
 
On Friday, the major indices were range-bound and closed with marginal losses over Thursday’s close. As many as 29 lakh debit cards, which were connected to Hitachi's switch, came under malware attack last year, Parliament was informed on Friday. "As reported by commercial banks, 29 lakh cards used at ATMs that were connected to switch of Hitachi were subjected to malware attack," Minister of State for Finance Santosh Kumar Gangwar said in a written reply in the Lok Sabha. However, the successful attempts of misuse of compromised cards reported to the Reserve Bank of India (RBI) by banks was only 3,291, he said. The S & P BSE Bankex closed at 24,151.13, down 0.46%. 
 

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Gravita India: Unusual Business, Slow Growth
Gravita India extracts lead. Lead is used in automobiles, telecommunications, power, nuclear and health industry. Gravita aims to be the largest recycler in the world by 2023 for which it diversified from lead recycling into aluminium and PET recycling (PET is a kind of plastic used to make articles like bottles). 
 
Established in 1992, in Jaipur, Gravita claims to have processing...
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