A bout of volatility was witnessed as key benchmark indices recovered from lower level after trimming intraday gains in early afternoon trade. The market breadth indicating the overall health of the market was strong. The barometer index, the S&P BSE Sensex, was currently up 65.89 points or 0.23% at 28,274.65. In global commodities markets, Brent crude oil futures edged higher after a sharp slide overnight. In overseas stock markets, European stocks edged higher in early trade there ahead of an emergency meeting of eurozone leaders in Brussels, where Greek Prime Minister Alexis Tsipras is expected to reveal fresh proposals to the country's creditors.
Capital goods shares were mixed. Most pharmaceutical shares were trading higher.
Earlier, the Sensex and the 50-unit CNX Nifty, both, hit their highest level in more than eleven weeks amid initial volatility.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 149.37 crore yesterday, 6 July 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) sold shares worth a net Rs 409.66 crore yesterday, 6 July 2015, as per provisional data released by the stock exchanges.
In overseas markets, European stocks edged higher in early trade there ahead of an emergency meeting of eurozone leaders in Brussels, where Greek Prime Minister Alexis Tsipras is expected to reveal fresh proposals to the country's creditors. Asian stocks edged lower as investors remained on edge amid uncertainty over Greece's position in the euro currency union. US stocks ended a choppy trading session slightly lower yesterday, 6 July 2015, as global equities came under pressure after Greece on Sunday, 5 July 2015, rejected its international lenders' bailout terms and moved closer to a potential exit from the eurozone.
At 13:15 IST, the S&P BSE Sensex was up 65.89 points or 0.23% at 28,274.65. The index jumped 126.47 points at the day's high of 28,335.23 in early trade, its highest level since 20 April 2015. The index fell 7.79 points at the day's low of 28,200.97 in early trade.
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The CNX Nifty was up 23.85 points or 0.28% at 8,546. The index hit a high of 8,561.35 in intraday trade, its highest level since 20 April 2015. The index hit a low of 8,523.45 in intraday trade.
The market breadth indicating the overall health of the market was strong. On BSE, 1,663 shares gained and 926 shares fell. A total of 117 shares were unchanged.
The BSE Mid-Cap index was up 74.36 points or 0.68% at 11,037.13. The BSE Small-Cap index was up 100.76 points or 0.88% at 11,527.75. Both these indices outperformed the Sensex.
Most pharmaceutical shares were trading higher. Wockhardt (up 3.42%), Piramal Enterprises (up 1.01%), Sun Pharmaceutical Industries (up 0.83%), Cadila Healthcare (up 0.70%), Strides Arcolab (up 0.68%), Aurobindo Pharma (up 0.53%), Divi's Laboratories (up 0.52%) and Dr. Reddy's Laboratories (up 0.37%), edged higher. Glenmark Pharmaceuticals (up (down 0.11%), Cipla (up (down 0.33%), GlaxoSmithKline Pharmaceuticals (down 0.34%), IPCA Laboratories (down 0.77%) and Lupin (down 1.08%), edged lower.
Capital goods shares were mixed. Bharat Electronics (up 2.71%), Jindal Saw (up 2.55%), BEML (up 2.42%), Havells India (up 2.19%), Alstom T&D India (up 2.07%), SKF India (up 1.33%), Crompton Greaves (up 1.10%), Siemens (up 0.94%), Punj Lloyd (up 0.81%), AIA Engineering (up 0.18%) and Bharat Heavy Electricals (up 0.06%), edged higher. ABB India (down 0.02%), Larsen & Toubro (down 0.07%), Suzlon Energy (down 0.22%), Thermax (down 0.28%), Pipavav Defence and Offshore Engineering Company (down 0.5%), Lakshmi Machine Works (down 0.79%), ALSTOM India (down 1.39%) and Praj Industries (down 1.51%), edged lower.
The Minister for Heavy Industries and Public Enterprises Anant Geete yesterday, 6 July 2015, said that his ministry is committed to bring Achche Din (good days) for the capital goods sector. Speaking at the inauguration of a workshop in Mumbai, Geete said that the Department of Heavy Industries will set up a Technology Adoption Fund to promote Research and Development in the industrial sector. He further said that the government has asked the industry to avail of the benefits of the recently launched Capital Goods Scheme which would help in acquiring or developing new technology.
Geete said that the technological capabilities of large number of players, especially in the SME sector, are limited in India and as a result India has become one of the largest importers of capital goods in the world. This has adversely affected the indigenous capital goods industry and the government wants to change this now. The Capital Goods Scheme launched under the Make in India initiative of Government of India provides support to the industry to acquire technology, set-up technology development centres in collaboration with institutes and create common infrastructure for the capital goods industry. A unique component of the scheme is technology acquisition fund where government is giving support upto 25% of the cost of technology subject to the limit of Rs 10 crore. The Capital Goods Scheme is expected to be particularly helpful for the industry in Maharashtra as a large number of engineering and capital goods clusters covering textiles machinery, machine tools, plastic machinery and engineering products are located in the state.
Meanwhile, in the global commodities markets, Brent crude futures edged higher today, 7 July 2015, after a sharp slide overnight. Brent for August settlement was currently up 63 cents at $57.17 a barrel. The contract had slumped $3.78 a barrel or 6.26% to settle at $56.54 a barrel during the previous trading session.
India imports about 80% of its crude requirements and a decline in crude eases concerns on fiscal deficit, inflation and gives more room for the government to boost growth through spending on infrastructure.
Meanwhile, India's weather office, the India Meteorological Department (IMD), said in its daily monsoon update issued yesterday, 6 July 2015, that the Southwest Monsoon was vigorous over West Uttar Pradesh and active over Jharkhand, Bihar, East Uttar Pradesh, Uttarakhand, Punjab and Himachal Pradesh and normal over Nagaland, Manipur, Mizoram & Tripura, Gangetic West Bengal and Haryana, Chandigarh and Delhi during past 24 hours upto 8:30 IST.
For the country as a whole, cumulative rainfall during this year's monsoon season was near normal until 6 July 2015. This is a far cry when compared to a reading 24% above the Long Period Average (LPA) for the South West monsoon until 24 June 2015. Region wise, the southwest monsoon was 12% above the LPA in Northwest India, 4% below the LPA in East & Northeast India, 2% below the LPA in Central India and 1% below the LPA in South Peninsula until 6 July 2015.
The quantum of and the spatial distribution of rainfall this month holds key, with July being a crucial month for the sowing of Kharif crops.
The June-September southwest monsoon is critical for the country's agriculture because a considerable part of the country's farmland is dependent on the rains for irrigation.
In overseas markets, European stocks edged higher in early trade today, 7 July 2015, ahead of an emergency meeting of eurozone leaders in Brussels, where Greek Prime Minister Alexis Tsipras is expected to reveal fresh proposals to the country's creditors. Key indices in Germany and France were up 0.18% to 0.37%. In UK, the FTSE 100 was off 0.02%. In Spain, the IBEX 35 index was up 0.22%. In Italy, the FTSE MIB index was up 0.85%.
France and Germany told Greece yesterday, 6 July 2015, to craft urgent proposals to prevent Greece's exit from the eurozone, a day after Greeks voted overwhelmingly to reject more austerity. German Chancellor Angela Merkel and French President Francois Hollande, the euro zone's most powerful leaders, said Athens must move quickly if it wants to secure a cash-for-reform deal with creditors and avoid crashing out of the single currency. In a referendum held on 5 July 2015, Greek voters overwhelmingly rejected reform measures put forward by the country's international creditors, a result seen as increasing the chances of Greece exiting the shared currency viz. the euro.
French Prime Minister Manuel Valls reportedly said on French radio today, 7 July 2015, that France will do everything to ensure that Greece stays in the eurozone. He said that Greece's exit from the eurozone would threaten global economic growth and represent a significant political risk.
Eurozone leaders are holding an emergency meeting in Brussels today, 7 July 2015, on Greece's debt crisis. Greek Prime Minister Alexis Tsipras is expected to present new proposals at a Eurozone emergency summit on his country's growing debt crisis.
Christine Lagarde, the International Monetary Fund chief, yesterday, 6 July 2015, reportedly said that the agency stands ready to assist Greece. The IMF is one of Greece's three creditors, and the country missed a payment to it at the end of last month.
Greece's banks will reportedly remain closed until tomorrow, 8 July 2015. Meanwhile, the European Central Bank (ECB) yesterday, 6 July 2015, said it would maintain existing levels of emergency cash support for Greek banks, which are running out of funds and on the verge of collapse. However, it told the banks to lodge more collateral with the Bank of Greece, reducing the amount of spare cash the banks have.
Last week, Greece ordered banks to close and capped ATM withdrawals at euro 60 a day after the ECB froze its financial lifeline to Greece following the breakdown of bailout talks in Brussels.
Greece's last bailout expired last Tuesday and Greece missed a euro 1.6 billion payment to the IMF.
Greece is due to pay 3.5 billion euros ($3.9 billion) to the ECB on 20 July 2015. If it misses that payment, the ECB is widely expected to cut off emergency funding to Greek banks, a move that would likely lead to their collapse.
In Germany, the latest data showed that industrial production was flat in May, as a robust rise in manufacturing was offset by a drop in construction output. Industrial production, adjusted for inflation and seasonal swings, was unchanged in May from April.
Asian stocks fell today, 7 July 2015, as investors remained on edge amid uncertainty over Greece's position in the euro currency union. Key benchmark indices in Taiwan, South Korea and Indonesia fell by 0.06% to 0.66%. Key benchmark indices in Japan and Singapore rose by 0.16% to 1.31%.
Chinese stocks declined, resuming their losing streak after the Chinese government's drastic market-stimulus efforts led to gains the previous day. The Shanghai Composite Index lost 1.29%. In Hong Kong, the Hang Seng index was off 1.05%. China has rolled out a steady stream of measures to arrest the selling frenzy that knocked $2.4 trillion in value from China's equities over the past three weeks.
US stocks ended a choppy trading session slightly lower yesterday, 6 July 2015, as global equities came under pressure after Greece on Sunday, 5 July 2015, rejected its international lenders' bailout terms and moved closer to a potential exit from the eurozone.
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