Key benchmark indices hovered within a narrow range in positive terrain in mid-afternoon trade. At 14:19 IST, the barometer index, the S&P BSE Sensex, was up 91.27 points or 0.37% at 24,809.29. The 50-unit Nifty 50 index was up 26.75 points or 0.36% at 7,536.95. Firmness in overseas markets supported gains on the domestic bourses. The market breadth indicating the overall health of the market was positive. On BSE, 1,275 shares rose and 1,225 shares fell. A total of 169 shares were unchanged. The BSE Mid-Cap index was currently up 0.27%, underperforming the Sensex. The BSE Small-Cap index was currently up 0.51%, outperforming the Sensex.
In overseas markets, European stocks rose, tracking firmness in Asian stocks. Asian stocks rose, buoyed by gains on Wall Street during the previous trading session on Friday, 11 March 2016, and firmer crude oil prices. In mainland China, the Shanghai Composite ended 1.75% higher. In Hong Kong, the Hang Seng index settled 1.17% higher. In Japan, the Nikkei Average settled 1.74% higher. The Bank of Japan's (BOJ) two-day policy meeting begins today, 14 March 2016. The BOJ is seen holding policy rate steady after adopting negative interest rates at its meeting in late January.
US stocks jumped on Friday, 11 March 2016, in a rally largely fueled by a rebound in oil prices. The US Federal Reserve's crucial two-day monetary policy meeting begins tomorrow, 15 March 2016. Federal Reserve officials are likely to hold short-term interest rates steady at its policy meeting amid uncertainties about global financial markets and global growth. The Fed in December 2015 raised its benchmark federal-funds rate from near zero to a range between 0.25% and 0.5%.
Cement stocks gained. ACC (up 0.59%), Shree Cement (up 2.26%), Ambuja Cements (up 1.67%), and UltraTech Cement (up 0.55%), gained.
Grasim Industries declined 0.09%. Grasim has exposure to the cement sector through its holding in UltraTech Cement.
Most pharma stocks gained. Cipla (up 0.55%), Lupin (up 0.43%), Dr Reddy's Laboratories (up 0.77%), Wockhardt (up 3.16%), Divi's Laboratories (up 1.29%), Cadila Healthcare (up 0.71%), and Glenmark Pharmaceuticals (up 1.9%) gained. Piramal Enterprises declined 0.56%.
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Pfizer was down 7.93% to Rs 1,775 after the company announced that it has discontinued the manufacture and sale of its "Corex" cough syrup with immediate effect. The company took the decision after the Government of India prohibited the manufacture, sale and distribution of fixed dose combination of Chlopheniramine Maleate + Codeine syrup with immediate effect, citing health risk. The prohibition is likely to have an adverse impact on the revenue and profitability of the company. Corex recorded sales of Rs 176 crore for nine months period ended 31 December 2015.
Pfizer said that Corex has a well-established efficacy and safety profile in India for more than 30 years and Pfizer makes every effort to maintain the highest standards of regulatory and quality compliance in the manufacture and distribution of Corex cough syrup. The company said that it is exploring all available options at its disposal.
Sasken Communication Technologies (Sasken) jumped 18.18% after the company said that it has reached a settlement in an ongoing matter pertaining to the unauthorized use of Sasken's Protocol Stack IP by a Chinese semiconductor vendor. The announcement was made during market hours today, 14 March 2016. This settlement brings to an end the ongoing arbitration and terminates all ongoing obligations of the parties under the relevant agreements, Sasken said. The licensee will pay Sasken $45 million as damages/compensation before 31 March 2016, towards this settlement. The formal settlement document is expected to be finalized in the next few days, Sasken said in a statement.
Bhushan Steel rose 5.4% after the company announced it has received the environment clearance from the Ministry of Environment, Government of India for addition of 7 million tonnes per annum (mtpa) pellet plant to the existing 5.6 mtpa integrated steel plant in district Dhenkanal in Orissa. The expansion project will involve an outlay of about Rs 3000 crore.
On macroeconomic front, data announced during market hours today, 14 March 2016, showed that inflation based on wholesale price index (WPI) stood at negative 0.91% in February 2016 as compared to a reading of negative 0.9% (provisional) in January 2016. Build up inflation rate in the financial year so far was minus 1.19% compared to a build up rate of minus 2.61% in the corresponding period of the previous year. For December 2015, WPI was revised to minus 1.06% as compared to minus 0.73% reported earlier.
Meanwhile, the data announced after market hours on Friday, 11 March 2016, showed that industrial production declined for the third straight month, registering a fall of 1.5% in January 2016 over January 2015. The output of the manufacturing sector declined 2.8% in January 2016, contributing to the decline in industrial production. Meanwhile, the mining sector output improved 1.2%, while the electricity generation also galloped 6.6% in January 2016.
Reserve Bank of India (RBI) Governor Raghuram Rajan on Saturday, 12 March 2016, said that the central bank's inflation-focused monetary framework would be strengthened by the constitution of the monetary policy committee (MPC) mooted in the Finance Bill 2016. Currently, the RBI governor decides key interest rates. Rajan's comments on MPC come after Finance Minister Arun Jaitley said in his speech on Union Budget 2016-17 on 29 February 2016 that the RBI Act 1934 is being amended to provide statutory basis for a Monetary Policy Framework and a Monetary Policy Committee through the Finance Bill 2016. Not only will a committee aggregate multiple views better than an individual can, it will offer more continuity and be less subject to undue pressure, Rajan said speaking at the First Ramnath Goenka Memorial Lecture in New Delhi.
Rajan also welcomed fiscal prudence, emphasis on capital spending and structural reforms in the agriculture sector in the Union Budget 2016-17. Rajan attributed the slowdown in India's international trade mainly to a fall in commodity prices and to some extent to a fall in trade volumes.
Rajan said the RBI has steadily expanded investment limits for foreign investors in government bonds and it will continue to do so. While making a case for attracting stable capital flows, Rajan said that the central bank intends to continuously ease both entry and exit norms for foreign investors.
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