IT, telecom stocks gain

Key benchmark indices were trading with small gains in mid-morning trade. At 11:24 IST, the barometer index, the S&P BSE Sensex, was up 86.15 points or 0.33% to 26,299.59. The Nifty 50 index was currently up 34.45 points or 0.43% at 8,067.30. The broad market depicted strength. The market sentiment was boosted after data showed that domestic institutional investors made substantial purchases of Indian stocks yesterday, 27 December 2016.

Domestic institutional investors (DIIs) bought shares worth a net Rs 1502.41 crore yesterday, 27 December 2016, as per provisional data. Foreign portfolio investors (FPIs) sold shares worth a net Rs 712.17 crore yesterday, 27 December 2016, as per provisional data released by the stock exchanges.

In side indices, the BSE Mid-Cap index was currently up 1.14%. The BSE Small-Cap index was currently up 1.23%. Both these indices outperformed the Sensex.

The broad market depicted strength. There were almost three gainers against every loser on BSE. 1,610 shares rose and 552 shares fell. A total of 113 shares were unchanged.

IT stocks gained for second day in a row as the rupee weakened against the dollar. A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports.

Infosys (up 0.57%), MindTree (up 3.69%), Hexaware Technologies (up 2.02%), Wipro (up 1.97%), Tech Mahindra (up 1.29%), HCL Technologies (up 0.85%) and Persistent Systems (up 0.99%) edged higher. Oracle Financial Services Software (down 0.98%) and MphasiS (down 0.55%) fell.

TCS rose 0.8% after the company announced that VersaCoId Logistics Services, Canada's largest end-to-end supply chain solutions company for temperature sensitive products has selected TAP, TCS' procure to pay cloud solution, to manage their operating costs with greater efficiency. The announcement was made after market hours yesterday, 27 December 2016.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 68.23, compared with closing of 68.06 during the previous trading session.

Telecom stocks gained. Idea Cellular (up 1.35%), MTNL (up 3.81%), Tata Teleservices (Maharashtra) (up 0.34%), Bharti Airtel (up 0.1%) and Reliance Communications (up 0.75%) gained.

Shares of Bharti Infratel advanced 3.48%. Bharti Infratel is a provider of tower and related infrastructure and is a unit of Bharti Airtel.

Dhanuka Agritech rose 2.5% to Rs 732.90 as the buyback committee of board of directors will meet on 3 January 2017, to approve the final terms and conditions of share buyback. Dhanuka Agritech's board at a meeting held on 10 November 2016, had approved the proposal of buyback of shares on a proportionate basis through a tender offer route for an amount not exceeding Rs 80 crore, being 16.69% of the total paid-up equity capital and free reserves of the company as on 31 March 2016, at a maximum price not exceeding Rs 850 per share. The announcement was made after market hours yesterday, 27 December 2016.

Electrosteel Steels rose 9.53%. According to a media report, the Ajay Piramal-led Piramal Enterprises and the Renaissance Group, an part of the Dalmia Group, are in the reckoning to jointly purchase a 51% stake in Electrosteel Steels.

While Piramal Enterprises is expected to invest Rs 1400 crore in Electosteel Steels through its private equity arm Piramal Capital, the Renaissance Group will manage the operations. The funds will be used to complete the expansion of the Bokaro plant and increase capacity by one million tonne to 2.5 mtpa, the report suggested.

Overseas, Asian stocks were trading mostly in green. US stocks rose in a thinly traded session yesterday, 27 December 2016 with the Nasdaq hitting its latest in a series of records as the market's recent upward bias continued, helped by a gain in technology shares. In the latest economic data, Consumer confidence in December jumped to 113.7 from a revised 109.4 in November, hitting its highest level since 2001.

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