The market barometers pared gains in mid-morning trade. Pharma shares witnessed profit booking. At 11:29 IST, the barometer index, the S&P BSE Sensex, was up 235.37 points or 0.64% at 37,255.51. The Nifty 50 index added 79.75 points or 0.73% at 10,981.45.
In the broader market, the S&P BSE Mid-Cap index rose 0.42% while the S&P BSE Small-Cap index gained 0.87%.
The market breadth is strong. On the BSE, 1376 shares rose and 955 shares fell. A total of 159 shares were unchanged.
Buzzing Index:
The Nifty Pharma index fell 1.21% to 10,341.75. The index added 6% in the past eight sessions while the benchmark Nifty 50 index rose 0.94% during the same period.
Sun Pharmaceutical (down 3.22%), Lupin (down 2.14%), Cipla (down 1.76%) and Aurobindo Pharma (down 1.54%) were the top index losers.
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Meanwhile, Divi's Labs was up 1.36%. The company said that its CFO L. Kishore Babu is proceeding on leave for the three months from 18 July 2020 to resolve the allegations of insider trading. Almost two weeks ago, SEBI reportedly found Divi's CFO and his son guilty for insider trading and charged penalty of Rs 97 lakh.
During the interim period, Venkatesa Perumallu Pasumarthy, General Manager (Finance and Accounts) will perform all the non-statutory functions of the Chief Financial Officer.
Stocks in Spotlight:
Mahindra & Mahindra Financial Services jumped 4.23% to Rs 216.70 after the firm reported strong financial performance in the June quarter. The counter registered a trading volume of 52.03 lakh shares, a 3.73 fold rise over two-week average daily volume of 13.94 lakh shares.
The NBFC posted a 298.41% jump in consolidated net profit to Rs 432.12 crore in Q1 June 2020 from Rs 108.46 crore reported in Q1 June 2019. Total income rose 16% year on year to Rs 3310.65 crore in Q1 June 2020.
The earnings includes an exceptional item in the nature of capital gain of Rs 229 crore on the basis of fair valuation of retained interest of 51% post stake dilution of 49% in its subsidiaries, Mahindra Asset Management Company (MAMCPL) and Mahindra Trustee Company (MTCPL), vide joint venture agreement with Manulife Asset Management (Singapore).
The NBFC's provisions and write offs stood at Rs 948.8 crore in Q1 June 2020, jumping 40% from Rs 676.9 crore in the same period last year. M&M Finance said an additional charge of Rs 664.5 crore has been added to provisions on account of COVID-19.
Meanwhile, the board has approved the rights issue instrument for a total number of equity shares and issue size of 61,77,64,960 equity shares for an aggregate amount not exceeding Rs 3,089 crore. The issue has been fixed as Rs 50 per equity share. The entire issue price will be payable at the time of making the application in the issue.
The issue opening date is 28 July 2020, and the closing date is 11 August 2020. The board has fixed 23 July 2020 as the record date for the same. The company has fixed the rights entitlement ratio as one fully equity share for every one equity share held by the eligible equity shareholders of the company, as on the record date.
Vodafone Idea surged 6.42% to Rs 9.45. The company said it paid additional Rs 1,000 crore to Department of Telecommunications on 17 July 2020 as part of its adjusted gross revenue (AGR) dues.
The company had earlier deposited Rs 6,854 crore in 3 tranches. The company has thus paid an aggregate amount of Rs 7,854 crore towards the AGR dues, the telco said in a filing on Saturday (18 July).
Global Markets:
Asian shares were trading mixed on Monday. Japan's exports dived 26.2% in June from a year earlier. Imports fell 14.4%, compared with expectations of a 16.8% decline.
China kept its benchmark lending rate steady for the third straight month on Monday. The one-year loan prime rate was kept unchanged at 3.85%, while the five-year remained at 4.65%.
European Union leaders on Friday reportedly kicked off a two-day summit aimed at reaching an agreement on a 750 billion euros recovery fund. However, the leaders have failed to agree on a massive stimulus fund, but have extended their summit for another day to try and overcome their differences.
US stocks closed Friday mostly along the flatline as investors reacted to disappointing consumer sentiment data and gauged the potential for additional fiscal stimulus in the U.S. and Europe while COVID-19 cases continue to climb.
Stocks gave up early gains to turn mixed after a US consumer sentiment index fell to 73.20 from 78.10 last month and down from 98.40 one year ago.
The continued rise in COVID-19 cases in the U.S. has been partly offset by optimism over scope for additional fiscal stimulus. The White House and lawmakers face increasing pressure to come up with an additional fiscal stimulus plan ahead of the expiration of supplemental unemployment benefits at the end of July.
The Federal Reserve on Friday announced it had expanded its Main Street Lending Program to include nonprofit organizations.
Shares of Netflix Inc. fell 6.5% after the streaming media giant reported an EPS of $1.59, versus an expectation of $1.81 EPS, which was widely reported in the media. The company also provided weak subscriber growth guidance for the third quarter, saying, growth is slowing as consumers get through the initial shock of Covid and social restrictions."
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