Nifty pares gains after hitting 8,400; pharma stocks tank

The benchmark indices on Thursday pared some gains amid mixed trade seen in other Asian markets after the US president-elect Donald Trump refrained from dropping any details of protectionist measures he could take to 'bring back' American jobs.

The Nifty50 index slipped below its crucial 8,400 level that it hit in the early trade, but the S&P BSE Sensex continued to trade above 27,000 mark.

At 11:50 am, the Sensex was trading at 27,206, up 66 points, while the broader Nifty50 was ruling at 8,393, up 13 points. 

The broader market underperformed the headline indices with BSE Midcap and BSE Smallcap indices losing 0.1% each.  

"We expect the Nifty to extend this rally towards 8,400-8,450 levels. On the other hand, previous resistance of 8,300 would now be seen as a strong support level for the index," said brokerage Angel Broking in a research note.  

Meanwhile, on Wednesday foreign portfolio investors (FPIs) sold shares worth Rs 627.30 crore, while domestic institutional investors (DIIs) bought shares worth a net Rs 1116.15 crore provisional data available with BSE showed.

Sectors and stocks

IT stocks were the best performers with BSE IT index rising 1.5%, led by gains in Cyient (up 6%), Trigyn Technologies (up 5%), Kellton Tech Solutions (up 3.6%) and Lycos (3.5%). 

Infosys was the top Sensex gainer and added over 2% to Rs 994 ahead of its quarterly earnings due tomorrow.

Biocon shares rallied 5% to Rs 1052 after the biotech firm and pharma firm Mylan said that the US health regulator has accepted Mylan's biologics license application (BLA) for MYL- 1401O, a proposed biosimilar trastuzumab indicated for treatment of breast cancer. 

Pharma stocks tanked and figured among top losers on the Sensex tracking global fall in drug firms after Trump said pharmaceutical companies are "getting away with murder" in what they charge the government for medicines. Dr Reddy's, Sun Pharma, Lupin and Cipla shed up to 2% on the BSE.

Jaitley aims to roll out GST by April

Finance Minister Arun Jaitley on Wednesday reiterated that the Centre is still aiming to roll out the Goods and Services Tax (GST) regime from April 1 if all pending issues are sorted out.

GST, which is to subsume most of central and state taxes like excise, service tax and VAT, needs to roll out by latest September 16, 2017, he said on the sidelines of the Vibrant Gujarat Global Summit.

Trump's presser disappoints 

Trump's widely-awaited press conference on Wednesday provided little clarity on future economic policies, disappointing investors who expected him to shed some light on the policies he intends to incorporate to boost US economy. 

Trump though mentioned building up of a wall against Mexico and 'border' tax on US corporates setting up factories abroad. 

The president-elect also talked about scrapping Obamacare, calling for cheaper drugs and pledging higher job opportunities in the world's largest economy.  

Urjit Patel speaks his mind 

Reserve Bank of India (RBI) Governor Urjit Patel cautioned that credit guarantees and interest rate subventions reduced the incentive to guard against risk when people were protected from its consequences.

Patel was speaking at Gandhinagar, Gujarat, at an event to commemorate GIFT, India’s first International Financial Services Centre (IFSC).

Global markets 

To the relief of Asian markets, Trump did not mention possible tariffs against Chinese exports, which may have triggered global trade war. Reacting to the news, China's Shanghai Composite gained 0.2%. MSCI's broadest index of Asia-Pacific shares outside Japan added 0.5% to its highest since early November. Australian and Korean stocks also edged higher. However, Japan's Nikkei slipped 0.7% as the yen appreciated against dollar.

Overnight, Wall Street ended higher after a choppy trading session. The Dow Jones Industrial Average closed up 98.75 points, or 0.5% to 19,954.28, the S&P 500 gained 6.42 points, or 0.28% to 2,275.32 and the Nasdaq Composite added 11.83 points, or 0.21% to 5,563.65.