A bout of volatility was witnessed as key benchmark indices trimmed losses soon after extending intraday slide in early afternoon trade. At 12:15 IST, the barometer index, the S&P BSE Sensex, was down 167.38 points or 0.6% at 27,774.73. The losses for the Nifty 50 index were lower in percentage terms than those for the Sensex. The Nifty was currently down 42.40 points or 0.5% at 8,522.60. A post result setback in index heavyweight and IT major Infosys weighed on the two key benchmark indices. Infosys tumbled after the company reduced revenue growth guidance in constant currency terms at the time of announcing its Q1 June 2016 results during trading hours. The Sensex failed to hold the psychologically important 28,000 mark after moving past that mark in early trade.
The Sensex dropped 206.24 points or 0.74% at the day's low of 27,735.87 in early afternoon trade, its lowest level since 12 July 2016. The barometer index rose 106.59 points or 0.38% at the day's high of 28,048.70 in early trade, its highest level since 17 August 2015. The Nifty fell 54.95 points or 0.64% at the day's low of 8,510.05 in early afternoon trade. The index gained 29.80 points or 0.35% at the day's high of 8,594.80 in early trade, its highest level since 10 August 2015.
In overseas stock markets, Asian shares rose after Wall Street struck another record high overnight. Chinese stocks eked out small gains after the release of a slew of economic reports. In mainland China, the Shanghai Composite index was currently up 0.09%. In Hong Kong, the Hang Seng index was currently up 0.04%. China's economy grew 6.7% in the second quarter from a year earlier, steady from the first quarter and slightly better than expected as the government stepped up efforts to stabilise growth in the world's second-largest economy. The National Bureau of Statistics also said today, 15 July 2016, that industrial output rose 6.2% in June from a year earlier, accelerating from 6% growth in May, while fixed-asset investment climbed 9% year on year for the January-June period, compared with an increase of 9.6% in the year's first five months. Retail sales grew 10.6% in June from a year earlier, accelerating from a 10% increase in May. The industrial-production and retail figures were better than expected while the investment figure was below expectation.
US stocks extended their run into the record books as the Dow Jones Industrial Average and the S&P 500 notched record closing highs yesterday, 14 July 2016. Stronger-than-expected results from large financial institutions, including J.P. Morgan Chase, as well as upbeat economic powered the climb.
In Europe, the Bank of England (BOE) left key rates unchanged at 0.5% after a monetary policy review yesterday, 14 July 2016. The Monetary Policy Committee (MPC) voted unanimously to maintain the stock of purchased assets financed by the issuance of central bank reserves at 375 billion. BOE said in a statement that the MPC is committed to taking whatever action is needed to support growth and to return inflation to the target over an appropriate horizon. To that end, most members of the committee expect monetary policy to be loosened at the next MPC meeting in August. Committee members made initial assessments of the impact of UK's vote to leave the European Union on demand, supply and the exchange rate. According to the initial assessment, economic activity is likely to weaken in the near term. The precise size and nature of any stimulatory measures will be determined during the August forecast and Inflation Report round.
Closer home, the market breadth indicating the overall health of the market was weak. On BSE, 1,412 shares fell and 936 shares rose. A total of 146 shares were unchanged. The BSE Mid-Cap index was currently up 0.37%, outperforming the Sensex. The BSE Small-Cap index was currently off 0.34%. The fall in this index was lower than the Sensex's decline in percentage terms.
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Auto stocks gained. Tata Motors (up 2.34%), Maruti Suzuki India (up 1%), Mahindra & Mahindra (M&M) (up 2.47%), Bajaj Auto (up 1.24%), TVS Motor Company (up 1.05%) and Eicher Motors (up 0.85%) gained. Ashok Leyland fell 0.16%.
Hero MotoCorp (HMCL) rose 0.66% after the company after market hours yesterday, 14 July 2016, announced the launch of the new Splendor iSmart 110, the first motorcycle to be developed completely in-house, with HMCL's own technology. Built on a completely new chassis and frame, the bike is powered by the new 110cc Torque on Demand engine that also features HMCL's patented i3S technology, the company said. The bike is now available at the Hero dealerships across India. The bike is priced at Rs 53,300 ex-showroom Delhi.
Metal and mining stocks saw mixed trend. National Aluminium Company (down 1.01%), Jindal Steel & Power (down 0.07%), Vedanta (down 0.09%), NMDC (down 0.57%) and Hindustan Copper (down 2.61%) edged lower. JSW Steel (up 1.85%), Tata Steel (up 3.44%), Steel Authority of India (Sail) (up 1.21%), Hindustan Zinc (up 0.44%) and Hindalco Industries (up 0.66%) rose.
Copper edged lower in the global commodities market. High Grade Copper for September 2016 delivery was currently off 0.09% at $2.241 per pound on the COMEX.
IT major and index heavyweight Infosys slumped after the company trimmed revenue growth guidance for the year ending 31 March 2017 (FY 2017) at the time of announcing its Q1 June 2016 results during trading hours. The stock was off 8.7% at Rs 1,072.75. In constant currency terms, the company has forecast 10.5%-12% growth in revenue for FY 2017. At the time of announcement of Q4 March 2016 and FY 2016 results, the company had forecast 11.5%-13.5% growth in revenue for FY 2017 in constant currency terms.
On a consolidated basis, Infosys' net profit fell 4.5% to Rs 3436 crore on 1.4% growth in revenue to Rs 16782 crore in Q1 June 2016 over Q4 March 2016. The results are as per International Financial Reporting Standards (IFRS). Infosys CEO Vishal Sikka said in a statement that the company witnessed unanticipated headwinds in discretionary spending in consulting services and package implementations as well as slower project ramp-ups in large deals, resulting in a lower than expected growth in Q1 June 2016.
Biocon rose after the company before market hours today, 15 July 2016 said that its partner FUJIFILM Pharma Co. has launched Insulin Glargine in Japan. The stock was up 0.2% to Rs 714.15. Insulin Glargine BS Injection Kit has been developed & manufactured by Biocon, and is being commercialised by FUJIFILM Pharma Co (FFP) in Japan. The product is a ready-to-use, prefilled disposable pen with 3ml of 100IU Insulin Glargine. It will provide a high quality, yet affordable, world-class long-acting biosimilar basal Insulin Glargine for patients of diabetes in Japan, Biocon said in a statement.
Biocon through its partner aims to capture a significant share of $144 million Japanese Glargine (as per IMS March 2015 data), which is second largest market outside of North America & Europe and is largely dominated by disposable pens, the company said.
Titan Company rose 2.95% after the company said it has signed a share purchase agreement for acquisition of about 62% stake in Carat Lane Trading for a purchase consideration of Rs 357.24 crore. Carat Lane Trading is involved in the business of designing, manufacturing, trading and retailing of gems and jewellery. The company reported revenue of Rs 141 crore for the year ended 31 March 2016. The acquisition is expected to be completed within 14 business days subject to completion of pre-closing conditions, Titan Company said. The announcement was made after market hours yesterday, 14 July 2016.
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