Capital goods stocks and index heavyweights HDFC and ITC led gains for key benchmark indices. The barometer index, the S&P BSE Sensex, rose 160.48 points or 0.64% to settle at 25,262.21. The gains for the Nifty 50 index were lower than the gains for the Sensex in percentage terms. The Nifty rose 28.95 points or 0.38% to settle at 7,735.50. The market witnessed intraday volatility. After extending gains in mid-afternoon trade when the news of the passage of Finance Bill 2016 in the Lok Sabha hit the market, the two key benchmark indices pared gains later. The government provided a thrust on the infrastructure, agriculture and rural sectors in the Union Budget 2016-17. The Sensex and the Nifty snapped a three-day losing streak.
Shares of Idea Cellular slumped on concerns of increase in debt burden and interest costs after a foreign brokerage reportedly said in a research note that the company may spend about Rs 8627 crore ($1.3 billion) in adding data spectrum in key markets in the upcoming spectrum auction around July 2016. Similar concerns weighed on the Bharti Airtel counter. Index heavyweight and housing finance major edged higher, with the stock extending post-result gains. Adani Ports and Special Economic Zone (APSEZ) dropped on reports that a foreign brokerage has reduced its price target on the stock, citing slowdown in the company's core port earnings growth.
In overseas stock markets, European stock markets edged higher, buoyed by some solid corporate earnings at the likes of BT. Asian stocks edged lower on data showing slowdown in growth in China's services sector last month. However, the data triggered speculation of likely stimulus for the Chinese economy, thereby aiding recovery in mainland China. The Shanghai Composite index ended 0.22% higher. In Hong Kong, the Hang Seng index ended 0.37% lower. The China Caixin services purchasing managers' index (PMI) dropped to 51.8 in April from 52.2 in March. China's official non-manufacturing PMI, a competing gauge, fell to 53.5 in April from 53.8 in March, according to data released on 1 May 2016. China's economy is the world's second biggest economy.
US stocks edged lower yesterday, 4 May 2016, after weaker-than-expected private-sector job data. The ADP employment data showed that private payrolls across the US rose by 156,000 last month. The increase is the smallest since April 2013. The report is seen as a precursor to the top-tier nonfarm-payrolls data due on Friday, 6 May 2016. The nonfarm-payrolls data has implications for the US monetary policy. The US central bank's mandate centers on maximizing employment and keeping inflation at a 2% target level. The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 14-15 June 2016.
The Sensex rose 160.48 points or 0.64% to settle at 25,262.21, its highest closing level since 2 May 2016. The index rose 292.37 points or 1.16% at the day's high of 25,394.10. The index rose 61.21 points or 0.24% at the day's low of 25,162.94.
The Nifty 50 index rose 28.95 points or 0.38% to settle at 7,735.50, its highest closing level since 3 May 2016. The index rose 71 points or 0.92% at the day's high of 7,777.55. The index rose 0.30 points at the day's low of 7,706.85.
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The market breadth indicating the overall health of the market was negative. On BSE, 1,322 shares declined and 1,228 shares rose. A total of 154 shares were unchanged. The BSE Mid-Cap index fell 0.09%. The BSE Small-Cap index fell 0.03%. Both these indices underperformed the Sensex.
Total turnover on BSE amounted to Rs 2328 crore, lower than turnover of Rs 2486.87 crore registered during the previous trading session.
Among sectoral indices on BSE, the S&P BSE Telecom index (down 1.81%), the S&P BSE Consumer Durables index (down 0.46%), the S&P BSE Oil & Gas index (down 0.16%), the S&P BSE Consumer Discretionary Goods & Services index (down 0.13%), the S&P BSE Teck index (down 0.13%), the S&P BSE Basic Materials index (down 0.11%), the S&P BSE Energy index (down 0.11%), the S&P BSE Bankex (up 0.03%), the S&P BSE Utilities index (up 0.08%), the S&P BSE IT index (up 0.19%), the S&P BSE Metal index (up 0.33%), the S&P BSE Healthcare index (up 0.39%), the S&P BSE Finance index (up 0.51%), the S&P BSE Auto index (up 0.57%) and the S&P BSE Power index (up 0.61%), underperformed the Sensex. The S&P BSE Realty index (up 0.73%), the S&P BSE FMCG index (up 0.83%), the S&P BSE Industrials index (up 0.87%) and the S&P BSE Capital Goods index (up 1.60%), outperformed the Sensex.
NTPC rose 0.69% to Rs 139.45. The company after trading hours today, 5 May 2016, announced that it has raised Rs 1000 crore through private placement of secured non-convertible debentures at a coupon of 8.05% per annum with a 10 year door-to-door maturity. The proceeds of the issue will be utilized to finance capital expenditure/refinancing the debt requirement in on-going projects including recoupment of expenditure already incurred.
Wipro rose 0.54% to Rs 542.70. The company after trading hours today, 5 May 2016, announced that it has successfully implemented its Software as a Service (SaaS) platform- Managed File Transfer as a Service (MFTaaS) on Amazon Web Services (AWS) for organizations, thereby helping them integrate digitally with their clients, partners and employees. Wipro anticipates that the MFTaaS platform can potentially reduce up to 30% in TCO (Total Cost of Ownership) for its clients vis-a-vis traditional deployments, the company said in a statement.
In a separate announcement, Wipro said that it has won a multi-year contract from Thames Water in the United Kingdom. Wipro will develop new IT systems and processes to help Thames Water improve customer experience and drive operational efficiencies. The announcement was after trading hours today, 5 May 2016.
Index heavyweight and cigarette major ITC rose 1.23% at Rs 316.65. The stock hit a high of Rs 320.20 and a low of Rs 311 in intraday trade.
Shares of Idea Cellular edged lower on concerns of increase in debt burden and interest costs after a foreign brokerage reportedly said in a research note that the company may spend about Rs 8627 crore ($1.3 billion) in adding data spectrum in key markets in the upcoming spectrum auction around July 2016. The stock fell 5.39% at Rs 113.15.
Bharti Airtel also edged lower on concerns of increase in debt burden and interest costs after this same foreign brokerage said in the research note that the company may selectively buy 4G airwaves in the coveted 700 Mhz band in a few circles in the upcoming spectrum auction around July 2016. The stock fell 1.64% at Rs 354.90.
Shares of Reliance Communications were down 1.45% at Rs 54.20.
Shares of telecom towers company Bharti Infratel were down 1.36% at Rs 369.50.
Capital goods majors edged higher on renewed buying. Crompton Greaves (up 3.96%), Punj Lloyd (up 3.91%), Siemens (up 3.83%), Bharat Heavy Electricals (Bhel) (up 2.88%), Larsen & Toubro (L&T) (up 2.20%), Thermax (up 1.53%), ALSTOM India (up 1.10%), Havells India (up 0.79%), ABB India (up 0.73%) and Reliance Defence and Engineering (up 0.17%), edged higher. Bharat Electronics (up 0.02%), Suzlon Energy (down 0.14%), BEML(down 0.58%), Praj Industries (down 0.88%), Lakshmi Machine Works (down 1.11%), Alstom T&D India (down 1.69%), SKF India (down 1.75%), Jindal Saw (down 1.99%) and AIA Engineering (down 2.56%), edged lower.
Eicher Motors edged lower in a volatile trade after announcing its financial performance for the quarter ended 31 March 2016. The stock fell 0.3% to Rs 19,687.45. The stock hit a high of Rs 19,999 and a low of Rs 19,208 in intraday trade. The company's consolidated net profit rose 71.3% to Rs 334.50 crore on 46.6% growth in total income from operations to Rs 3764.90 crore in the quarter ended 31 March 2016 over the quarter ended 31 March 2015. The result was announced during market hours today, 5 May 2016.
Eicher Motors' Managing Director & CEO Siddhartha Lal said that the immediate business outlook for the Royal Enfield motorcycles business remains strong. Royal Enfield will invest Rs 600 crore during the year ending 31 March 2017 (FY 2017) towards product development, enhancing manufacturing capacity and market development activities across geographies and for setting up two technical centres - one in Leicestershire, UK and another in Chennai, India.
VE Commercial Vehicles, which is a joint venture of Eicher Motors with the Volvo group, intends to invest Rs 400 crore towards product development and capacity expansion in FY 2017. VE Commercial Vehicles makes trucks and buses.
Index heavyweight and housing finance major HDFC rose 2.58% at Rs 1,160.20, with the stock extending post-result gains. HDFC's net profit rose 39.98% to Rs 2607.05 crore on 23.72% growth in total income to Rs 9225.72 crore in Q4 March 2016 over Q4 March 2015. The surge in net profit was due to profit on sale of a part of its stake in the life insurance joint venture to the company's joint venture partner Standard Life. The company announced its Q4 March 2016 results during market hours on 2 May 2016.
HDFC after trading hours yesterday, 4 May 2016, announced that it intends to raise Rs 1135 crore through private placement of senior secured redeemable non-convertible debentures. HDFC said that the coupon rate of debentures is 8.34% per annum with a tenor of 2 years and 10 months. The issue opens and closes on the same day on 6 May 2016. The object of the issue is to augment the long-term resources of the company.
Adani Ports and Special Economic Zone (APSEZ) lost 4.48% at Rs 198.35 on reports that a foreign brokerage has reduced its price target on the stock, citing slowdown in the company's core port earnings growth. The brokerage has retained its hold rating on the stock. The APSEZ stock slumped yesterday, 4 May 2016, on equity dilution worries after the company's board of directors decided to seek shareholders' approval to raise funds by way of issue of equity shares/convertible bonds up to Rs 10000 crore. The stock had tumbled 11.97% to settle at Rs 207.65 yesterday, 4 May 2016. APSEZ's consolidated net profit rose 38.34% to Rs 914.06 crore on 18% increase in total income to Rs 2161.65 crore in Q4 March 2016 over Q4 March 2015. EBITDA (earnings before interest, taxes, depreciation and amortization) excluding other income rose 12% to Rs 1225 crore in Q4 March 2016 over Q4 March 2015. The result was announced after market hours on 3 May 2016.
Most banks edged lower. Among state-run banks, Indian Bank (down 3.53%), Syndicate Bank (down 1.13%), Andhra Bank (down 1.08%), Union Bank of India (down 0.93%), Allahabad Bank (down 0.65%), IDBI Bank (down 0.45%), Punjab and Sind Bank (down 0.28%), United Bank of India (down 0.26%), Bank of India (down 0.18%), Dena Bank (down 0.17%), UCO Bank (down 0.14%) and Central Bank of India (down 0.12%), edged lower. Corporation Bank (up 0.14%), State Bank of India (up 0.14%), Canara Bank (up 0.29%), Vijaya Bank (up 0.32%), Bank of Maharashtra (up 0.52%), Bank of Baroda (up 0.54%) and Punjab National Bank (up 0.62%), edged higher.
Among private sector banks, City Union Bank (down 0.36%), Kotak Mahindra Bank (down 0.34%), ICICI Bank (down 0.19%), IndusInd Bank (down 0.18%) and Axis Bank (down 0.13%), edged lower. Federal Bank (up 0.10%) and HDFC Bank (up 0.53%), edged higher.
Yes Bank fell 0.59% to Rs 912.30. The private sector bank has received in-principle approval by Securities and Exchange Board of India (Sebi) for acting as custodian of securities. Custodian of securities is a license granted by Sebi to eligible entities allowing them to offer custodial services to financial market participants including foreign institutional investors (FIIs) and foreign portfolio investors (FPIs).
The Sensex and the Nifty snapped a three-day losing streak. The Sensex fell 504.89 points or 1.97% in the preceding three trading sessions to settle at 25,101.73 yesterday, 4 May 2016, from its close of 25,606.62 on 29 April 2016. The Sensex has fallen 341.41 points or 1.33% this month so far (till 5 May 2016). The Sensex has fallen 851.33 points or 3.26% in calendar year 2016 so far (till 5 May 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 2,769.60 points or 12.31%. The Sensex is off 3,315.12 points or 11.60% from a 52-week high of 28578.33 hit on 23 July 2015. The Sensex is off 4,762.53 points or 15.86% from a record high of 30,024.74 hit on 4 March 2015.
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