Firmness continued on the bourses in mid-morning trade. At 11:23 IST, the barometer index, the S&P BSE Sensex, was up 348.55 points or 1.39% at 25,579.15. The gains for the Nifty 50 index were lower than the Sensex's gains in percentage terms. The Nifty was currently up 100.75 points or 1.3% at 7,834.20. The broad market depicted strength. There were more than two gainers against every loser on BSE. 1,512 shares rose and 691 shares fell. A total of 114 shares were unchanged. The BSE Mid-Cap index was currently up 0.91%. The BSE Small-Cap index was currently up 0.89%. Both these indices underperformed the Sensex.
The Sensex jumped 380.09 points or 1.5% at the day's high of 25,608.59 in mid-morning trade, its highest level since 3 May 2016. The barometer index rose 74.36 points or 0.29% at the day's low of 25,302.86 at the onset of the trading session. The Nifty gained 110.45 points or 1.42% at the day's high of 7,843.90 in mid-morning trade, its highest level since 3 May 2016. The index rose 20.10 points or 0.25% at the day's low of 7,753.55 at the onset of the trading session.
In overseas stock markets, Asian stocks witnessed a mixed trend. Stocks fell in mainland China after the latest data showed that China's exports and imports fell more than expected in April, underlining weak demand at home and abroad. The Shanghai Composite was currently down 2.36%. In Hong Kong, the Hang Seng index was currently up 0.41%. China's exports declined 1.8% in April in dollar terms, reversing an increase of 11.5% the previous month, the General Administration of Customs said yesterday, 8 May 2016. Imports in April fell by a sharper-than-expected 10.9% from a year earlier, compared with a 7.6% drop in March.
US stocks posted modest gains on Friday, 6 May 2016, as the weaker-than-expected April job report fanned expectations that the Federal Reserve would have to hike interest rates at a very slow pace. US non-farm payrolls increased by 160,000 in April, the smallest gain since September, and below market expectations.
UltraTech Cement gained after the company said that its board of directors has approved a proposal for increase in investment limits by registered foreign portfolio investors (RFPIs) including foreign institutional investors (FIIs) from the existing 24% of the paid-up equity share capital to 30%. The stock rose 2.2%. The increase in the limits is subject to the approval of the shareholders at the ensuing Annual General Meeting of the company to be held in July 2016, the date of which will be intimated separately. The announcement was made during market hours today, 9 May 2016.
Grasim Industries rose after the company announced strong Q4 results. The stock rose 1.09%. The company's consolidated net profit rose 37.38% to Rs 696.09 crore on 13.69% rise in net sales to Rs 9896.43 crore in Q4 March 2016 over Q4 March 2015. The result was announced on Saturday, 7 May 2016. Grasim Industries' earnings before interest, taxes, depreciation and amortization (EBITDA) rose 24.19% to Rs 2059 crore in Q4 March 2016 over Q4 March 2015. Grasim Industries said it has posted impressive results led by robust volume growth in all its businesses viz. viscose staple fibre (VSF), chemical and cement. During the year, under a court approved scheme of amalgamation, Aditya Birla Chemicals (India) (ABCIL), has been amalgamated with the company from the appointed date of 1 April 2015. In view of amalgamation of ABCIL with the company, the results for the quarter and the year ended 31 March 2016 are not strictly comparable with corresponding periods of the previous year.
With regard to the future outlook for the VSF business, Grasim said that VSF capacity addition has slowed down globally. Further, cotton production is projected to be lower than the consumption in the 2015-16 season with reduced acreage and unfavorable climate. As a result, the price volatility of VSF is expected to reduce. The company will continue to focus on expanding VSF market in India by partnering with the textile value chain and better customer connect through its Liva brand. Enhancing product mix through larger share of specialty fibre will be yet another focus area.
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With regard to the future business outlook for the caustic soda business, Grasim said that the caustic soda demand in India is expected to grow with increase in demand from the end user industry. To meet the growing demand, Grasim is expanding its caustic soda capacity by 100,000 tonnes per annum through debottlenecking at different units. With regard to the future business outlook for the cement business, Grasim said that cement demand is expected to grow at 7%-8% in the year ending 31 March 2017, driven by the government's focus on infrastructure development, housing, smart cities etc. The company is well positioned across the country to cater the growth in demand.
Bank stocks gained across the board. Among public sector banks, Punjab National Bank (up 1.11%), Bank of Baroda (up 1.33%), State Bank of India (SBI) (up 1.19%), Union Bank of India (up 1.87%), Canara Bank (up 1.3%), and Bank of India (up 0.98%) edged higher.
Among private sector banks, HDFC Bank (up 1.66%), Axis Bank (up 1.63%), ICICI Bank (up 1.58%), Kotak Mahindra Bank (up 1.33%), Yes Bank (up 1.38%) and IndusInd Bank (up 1.1%) edged higher.
The Lok Sabha, last week, passed the Insolvency and Bankruptcy Code, 2015. Once the bill becomes a law, it will help creditors recover bad debt faster. The bankruptcy bill aims to provide single unified law for timely resolution of insolvency and bankruptcy related cases in India. The bill will now go to the Rajya Sabha for its passage.
Meanwhile, the Reserve Bank of India (RBI) has announced open market operations of government securities for an aggregate amount of Rs 10000 crore on 10 May 2016 through multi-security auction using the multiple price method.
Telecom stocks edged higher on renewed buying. Bharti Airtel (up 1.35%), Tata Teleservices (Maharashtra) (up 0.74%) Reliance Communications (up 1.38%) and Idea Cellular (up 0.66%) gained.
Shares of diagnostic chain operator Thyrocare Technologies were trading at Rs 625.70 at 11:00 IST on BSE, a premium of 40.29% over the initial public offer price of Rs 446. The stock debuted at Rs 662, a premium of 48.43% to the initial public offer (IPO) price. So far the stock hit a high of Rs 665.40 and low of Rs 606 so far during the day. On BSE, 15.47 lakh shares were traded on the counter.
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