After a range bound movement in mid-morning trade, the two key benchmark indices extended gains in early afternoon trade. At 12:15 IST, the barometer index, the S&P BSE Sensex, was up 102.10 points or 0.37% at 27,728.79. The Nifty 50 index was currently up 28.90 points or 0.34% at 8,496.80. Gains in Asian stocks underpinned sentiment on the domestic bourses.
The market breadth indicating the overall health of the market was negative. On BSE, 1,280 shares declined and 1,174 shares rose. A total of 134 shares were unchanged. The BSE Mid-Cap index was currently up 0.55%, outperforming the Sensex. The BSE Small-Cap index was currently up 0.18%, underperforming the Sensex.
In overseas stock markets, Japanese stocks led gains in Asian equities as investors gained confidence in Japanese Prime Minister Shinzo Abe's ruling coalition, which increased its control in the upper house of parliament after election for the upper house held on 10 July 2016. The Nikkei 225 Average closed 2.46% higher. Anticipation was also growing that Abe would soon introduce a fresh fiscal stimulus package to help the stagnant economy. Speculation was also growing that an expected meeting between former US Federal Reserve Chairman Ben Bernanke and Abe today, 12 July 2016, would include talks about a radical measure in which a central bank directly funds government spending. The Nikkei 225 Average surged 4% yesterday, 11 July 2016, registering its biggest daily-percentage gain since 2 March 2016, as Abe's ruling-coalition victory in the upper-house election stoked speculation of more fiscal stimulus.
US stocks edged higher yesterday, 11 July 2016, with the S&P 500 index hitting record high on intraday as well as on closing basis as investors bought stocks amid a reinvigorated appetite for assets perceived as risky following a surprisingly strong jobs report for June 2016 released during trading hours in the US on Friday, 8 July 2016.
Auto stocks edged higher on renewed buying. Escorts (up 0.73%), Mahindra & Mahindra (M&M) (up 0.06%), Eicher Motors (up 0.03%), Ashok Leyland (up 0.8%), Bajaj Auto (up 0.08%), Hero MotoCorp (up 0.29%) and TVS Motor Company (up 1.37%) rose. Tata Motors slipped 0.25%.
Maruti Suzuki India advanced 1.98% as Japanese yen eased against the dollar. A weak yen lifts Maruti's operating profit margin. Maruti pays royalty to its Japanese parent Suzuki Motor Corporation in yen terms for some of its earlier models. Maruti has reportedly started paying royalty to its Japanese parent in rupee terms on all new models from 1 April 2016. Maruti also has an exposure to the yen to the extent it imports raw materials from Japan.
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IndusInd Bank rose 0.49% after the private sector bank announced the opening of IFSC banking unit (IBU) at the Gujarat International Finance Tec-City (GIFT City) to meet the requirements of offshore banking operations in India. IndusInd Bank's International Banking Unit (IBU) will provide the bank access to international financial markets and will allow IndusInd to deliver a complete range of products to its clients with foreign currency funding requirements. The bank will now be able to actively offer products such as external commercial borrowings to its customers, an area where it had limited capabilities hitherto. The announcement was made during market hours today, 12 July 2016.
IndusInd Bank's net profit rose 25.96% to Rs 661.38 crore on 22.36% growth in total income to Rs 4264.66 crore in Q1 June 2016 over Q1 June 2015. The result was announced during trading hours yesterday, 11 July 2016.
Realty stocks saw mixed trend. Indiabulls Real Estate (up 0.59%), Omaxe (up 0.62%), Unitech (up 3.31%), Godrej Properties (up 1.22%), and Parsvnath Developers (up 1.71%) gained. Peninsula Land (down 3.03%), Oberoi Realty (down 1.03%), DLF (down 0.41%), Housing Development and Infrastructure (down 0.37%), D B Realty (down 1.15%) and Sobha (down 0.77%) declined.
Suven Life Sciences rose 2.1% after the company secured one product patents each in India and South Africa corresponding to the New Chemical Entities (NCEs) for the treatment of disorders associated with Neurodegenerative diseases.
Shriram EPC rose 10.63% after the company said that its board approved conversion of the working capital term loan of the corporate debt restructuring (CDR) lenders into equity shares of the company to the maximum extent of Rs 1280 crore, subject to shareholders' approval and other regulatory approvals at a price to be determined as per regulations. The board also approved preferential issue of Rs 265 crore to the holding company SVL (erstwhile Shriram Industrial Holdings) subject to shareholders' approval and other regulatory approvals at a price to be determined as per regulations. The announcement was made after market hours yesterday, 11 July 2016.
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