Telecom and oil sector stocks led gains as key benchmark indices edged higher for the third straight trading session. The barometer index, the S&P BSE Sensex, rose 173.93 points or 0.69% to settle at 25,494.37. The Nifty 50 index rose 50 points or 0.65% to settle at 7,750.90. The two key benchmark indices traded in positive zone throughout the trading session. The Sensex, and the Nifty, both, hit their highest closing level in more than a week.
Gain in Asian stocks underpinned sentiment on the domestic bourses. Asian stocks edged higher after overnight gains for US stocks. Energy sector stocks led gains for US equities yesterday, 15 December 2015, as crude oil prices rose. Meanwhile, the US Federal Reserve is widely expected to raise the federal funds rate by 25 basis points after the conclusion of a two-day monetary policy meeting today, 16 December 2015. With markets having already priced in a 25 basis points rate hike this week, the focus has shifted to the likely pace and quantum of rate hikes once this first move is done. The US central bank has hinted that it intends to hike rates gradually.
Index heavyweight and IT major Infosys rose after the company announced that Fubon Bank (Hong Kong) Limited, a wholly owned subsidiary of Fubon Financial Holding Co., has decided to adopt Infosys Finacle's newgeneration Finacle Core Banking solution. TCS rose after the company announced that it won a multi-year, multi-million deal from Deutsche Lufthansa AG, a leading global aviation group. Bharat Heavy Electricals (Bhel) rose after the company announced that it has added one more coal-based power plant to the grid by successfully commissioning a 500 megawatts (MW) thermal generating unit in West Bengal.
The Sensex rose 173.93 points or 0.69% to settle at 25,494.37, its highest closing level since 7 December 2015. The index jumped 252.46 points or 0.99% at the day's high of 25,572.90. The index rose 52.03 points or 0.2% at the day's low of 25,372.47.
The Nifty rose 50 points or 0.65% to settle at 7,750.90, its highest closing level since 7 December 2015. The index jumped 75.70 points or 0.98% at the day's high of 7,776.60. The index rose 14.85 points or 0.19% at the day's low of 7,715.75.
The BSE Mid-Cap index rose 0.35%. The BSE Small-Cap index rose 0.24%. Both these indices underperformed the Sensex.
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The market breadth indicating the overall health of the market was positive. On BSE, 1,426 shares rose and 1,267 shares fell. A total of 225 shares were unchanged.
Among the sectoral indices on BSE, the S&P BSE Energy index (up 1.12%), BSE Finance index (up 1.01%), BSE IT index (up 1.07%), BSE Telecom index (up 2.42%), BSE Utilities index (up 1.51%), BSE Bankex index (up 1.16%), BSE Oil & Gas index (up 1.71%), BSE Power index (up 1.3%), BSE Realty index (up 0.92%) and BSE Teck index (up 1.3%) outperformed the Sensex. The S&P BSE FMCG index (down 0.58%), BSE Healthcare index (up 0.52%), BSE Auto index (down 0.51%) and BSE Consumer Durables index (down 0.58%) underperformed the Sensex.
Bank stocks edged higher. Among private sector banks, ICICI Bank (up 2.29%), IndusInd Bank (up 1.42%), Kotak Mahindra Bank (up 1.34%), Yes Bank (up 1.12%) and Axis Bank (up 0.45%) edged higher.
HDFC Bank rose 0.93% at Rs 1,067 after the bank issued and allotted senior, unsecured, redeemable, long term, non-convertible bonds in the nature of debentures amounting to Rs 2975 crore on a private placement basis. The bank made the announcement after market hours yesterday, 15 December 2015.
Among PSU banks, Andhra Bank (up 1.05%), Oriental Bank of Commerce (up 0.79%), Syndicate Bank (up 0.65%), Bank of Baroda (up 0.63%), Union Bank of India (up 0.86%), Canara Bank (up 0.29%), State Bank of India (up 0.53%) and IDBI Bank (up 0.12%) edged higher. Vijaya Bank (down 0.59%), Punjab National Bank (down 0.57%) and Central Bank of India (down 0.29%) edged lower.
Telecom stocks edged higher. Bharti Airtel (up 3.83%), Idea Cellular (up 2.85%) and Reliance Communications (up 1.87%) edged higher. Tata Teleservices (Maharashtra) (down 0.25%) and Mahanagar Telephone Nigam (down 2.2%) edged lower.
Index heavyweight and housing finance major HDFC rose 1.02% at Rs 1,219. The stock hit a high of Rs 1,222.65 and a low of Rs 1,209.55 in intraday trade.
Another index heavyweight and cigarette major ITC fell 0.96% at Rs 319.50. The stock hit a high of Rs 324.60 and a low of Rs 318.25 in intraday trade.
Index heavyweight and IT major Infosys rose 1.72% at Rs 1,095.40 after the company announced that Fubon Bank (Hong Kong) Limited, a wholly owned subsidiary of Fubon Financial Holding Co., has decided to adopt Infosys Finacle's newgeneration Finacle Core Banking solution. This transformation initiative will significantly improve the bank's operational efficiency, strengthen innovation capabilities and support rapid growth, Infosys said in a statement. The announcement was made after market hours yesterday, 15 December 2015. Finacle is the industry-leading universal banking solution from EdgeVerve Systems, a wholly owned subsidiary of Infosys.
TCS rose 1.34% at Rs 2,407.10 after the company announced during trading hours today, 16 December 2015, that it won a multi-year, multi-million deal from Deutsche Lufthansa AG, a leading global aviation group, to provide testing services and help improve the quality of services of existing technology operations. The deal is part of Lufthansa's IT-transformation initiative to accelerate speed to market, improve customer experience and enable innovation and continuous improvement.
Wipro fell 0.64% at Rs 555. The stock hit a high of Rs 559.15 and a low of Rs 553 in intraday trade. The company provided a business update on its Chennai operations. The recent heavy rainfall and resultant flooding impacted the regular business operations of Wipro's Chennai facilities during the first week of December. Business continuity plans were invoked for the work being done from the company's facilities to ensure there was no disruption in the business-critical operations of its customers. Wipro has multiple facilities in Chennai with over 22,000 employees. Wipro has been focused on ensuring the safety of its employees and their families and has rolled out multiple employee support initiatives to mitigate their hardship during this period. For the quarter ending 31 December 2015, the incident is expected to have a material impact on the revenues and will result in higher one-time cost incurred towards deployment of the company's business continuity plan. Both these factors will impact the firm's operating margins for the quarter. Revenue from Wipro's IT Services business is expected to be in the previously communicated range of $1,841 million to $ 1,878 million. However, the company said it expects revenue to be in the lower half of the guidance range. The announcement was made before trading hours today, 16 December 2015.
Stocks of diesel vehicle makers were mixed. Ashok Leyland (up 0.69%) and Tata Motors (up 0.34%) edged higher. Mahindra & Mahindra (M&M) fell 5.44%. The Supreme court today, 16 December 2015, imposed a ban on registration of new diesel sport utility vehicles and private cars in Delhi with an engine capacity of over 2000cc until 31 March 2016. The court clarified that no non-Delhi destined trucks can enter the city from National highways 1 and 8 and specified that no truck registered prior to 2005 can ply on the roads of Delhi.
The court was hearing petitions seeking to address Delhi's alarming pollution levels.
Shares of gas production and distribution companies rose after the Supreme Court today, 16 December 2015, ordered that taxis plying in Delhi will have to be converted into compressed natural gas (CNG) by 1 March 2016. Indraprastha Gas (up 6.79%) and Gujarat Gas (up 5.72%) edged higher.
Shares of state-run gas transmission major GAIL (India) edged higher in volatile trade. The stock rose 1.34% at Rs 344.05. The stock hit a high of Rs 359.60 and a low of Rs 340 in intraday trade.
The Supreme Court today, 16 December 2015, banned the registration of new diesel sport utility vehicles and private cars in Delhi with an engine capacity of over 2000cc until 31 March 2016. The Supreme Court's order as well as recent efforts by the Delhi government to curb alarming levels of pollution in the city will increase demand for vehicles running on cleaner fuels like CNG thus auguring well for gas producing and distribution companies.
Shares of oil exploration and production firms edged higher. Cairn India (up 3.47%), ONGC (up 3.99%), Oil India (up 3.15%) and Reliance Industries (up 0.22%) edged higher.
Shares of public sector oil marketing companies (PSU OMCs) also moved higher. HPCL (up 2.28%), BPCL (up 1.64%) and Indian Oil Corporation (up 1.94%) edged higher. PSU OMCs have reduced the price of petrol by 50 paise a litre and diesel price by 46 paise a litre in Delhi with corresponding price revision in other states with effect from the midnight of 15 December 2015. Meanwhile, the government today, 16 December 2015, reportedly raised excise duty on diesel by Rs 1.17 per litre and on petrol by 30 paise per litre. The hike seeks to take advantage of a slump in global crude oil prices to shore up government revenues without stoking inflation.
In the global commodities markets, Brent for January settlement was currently down $1.04 a barrel at $37.41 a barrel. The contract had risen 53 cents or 1.4% to settle at $38.45 a barrel during the previous trading session. Brent for February settlement was currently down $1.06 a barrel at $37.67 a barrel. The Brent January contract expires today, 16 December 2015.
Bharat Heavy Electricals (Bhel) rose 1.17% at Rs 168.05 after the company after market hours yesterday, 15 December 2015, announced that it has added one more coal-based power plant to the grid by successfully commissioning a 500 megawatts (MW) thermal generating unit in West Bengal. The 500 MW (unit 3) was commissioned at the upcoming Sagardighi thermal power extension project of West Bengal Power Development Corporation (WBPDCL), located at Murshidabad district of West Bengal. This is the first unit of phase II (2x500 MW) of the power plant and the second unit is also in advance stage of completion, Bhel said. The company said it has already commissioned 3,750 MW of power plants in the utility sector in the current financial year and is on track to achieve the target set by the government for the year.
L&T fell 0.14% at Rs 1,281.20. The stock hit a high of Rs 1,298.55 and a low of Rs 1,277.10 in intraday trade. L&T announced that Canada Pension Plan Investment Board (CPPIB) has completed its second tranche investment of Rs 1000 crore into L&T's subsidiary L&T Infrastructure Development Projects (L&T IDPL) by subscribing to compulsorily convertible preference shares of L&T IDPL. The announcement was made after market hours yesterday, 15 December 2015. It may be recalled that L&T and CPPIB had in June 2014, entered into a definitive agreement whereby CPPIB through its Singapore-based wholly owned subsidiary, had committed to make an investment of Rs 2000 crore into L&T IDPL in two tranches. The first tranche investment of Rs 1000 crore was made in December 2014.
Nestle India fell 0.17% at Rs 5,820.65. The stock hit a high of Rs 5,912 and a low of Rs 5,810.10 in intraday trade. The company has received a favourable decision in an appeal filed by the company against the National Consumer Disputes Redressal Commission (NCDRC) in the Supreme Court. The apex court has directed that the proceedings before the NCDRC are stayed. The apex court has also accepted the company's request to send the samples of Maggi noodles for testing to NABL accredited government referral laboratory viz. CFTRI, Mysore.
Key indices gained for the third straight session. The Sensex has risen 449.94 points or 1.79% in preceding three trading sessions from a recent low of 25,044.43 on 11 December 2015. The Sensex has declined 651.30 points or 2.49% in this month so far (till 16 December 2015). The Sensex has fallen 2,005.05 points or 7.29% in this calendar year so far (till 16 December 2015). From a 52-week low of 24,833.54 hit on 8 September 2015, the Sensex has risen 660.83 points or 2.66%. The Sensex is off 4,530.37 points or 15.08% from a record high of 30,024.74 hit on 4 March 2015.
Meanwhile, Finance Minister Arun Jaitley reportedly said today, 16 December 2015, that the proposed Goods and Services Tax (GST) rate would be much less than 18%. Jaitley's comments on the GST rate come after a committee headed by Chief Economic Adviser Arvind Subramanian on possible tax rates under goods and services tax (GST) in its report submitted to the government early this month suggested standard GST rate at 17% to 18%. Typically, the majority of the goods and services will be taxed at the standard rate under the GST regime. The Finance Minister was also quoted as saying that the demand to scrap the 1 percent levy under the GST Bill is fair. The GST constitutional amendment bill has been stuck in the Rajya Sabha where the BJP-led NDA lacks a majority. A constitutional amendment bill requires a majority of two thirds in the house for its passage. The bill has been passed by the Lok Sabha. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country.
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