Gains in global stocks helped the two equity benchmark indices in India reverse intraday losses in afternoon trade. At 13:16 IST, the barometer index, the S&P BSE Sensex, was up 89.72 points or 0.35% at 25,778.58. The gains for the Nifty 50 index were lower than Sensex's gains in percentage terms. The Nifty was currently up 18.40 points or 0.23% at 7,884.45. The Sensex hit its highest level in almost two weeks when it rose 99.08 points or 0.38% at the day's high of 25,787.94 in afternoon trade. The barometer index lost 74.62 points or 0.29% at the day's low of 25,614.24 in mid-morning trade. The Nifty hit 1-week high when it rose 22.10 points or 0.28% at the day's high of 7,888.15 in afternoon trade. The index lost 28.35 points or 0.36% at the day's low of 7,837.70 in mid-morning trade.
In overseas stock markets, banking stocks led gains in European stocks after Swiss lender Credit Suisse Group posted a smaller-than-expected net loss in the first quarter. Resources shares also edged higher as crude and metal prices rose. Japanese stocks led gains in Asian equities after Japanese finance minister Taro Aso told a parliamentary session today, 10 May 2016, that it would be natural for the Japanese government to intervene if the yen were to gain abruptly against the US dollar. The Nikkei 225 Average settled 2.15% higher. A strong local currency puts pressure on the earnings of exporters because it can make their goods more expensive overseas. The Japanese finance minister yesterday, 9 May 2016, said that he was prepared to undertake intervention in the foreign-exchange market.
Chinese stocks edged higher as consumer inflation numbers were seen as leaving enough room for further monetary easing from China's central bank amid a continued slowdown in growth. In mainland China, the Shanghai Composite index ended 0.02% higher. In Hong Kong, the Hang Seng index was currently up 0.67%. The latest data showed that China's consumer price index remained unchanged at 2.3% in April from a year earlier. The producer price index declined 3.4% in April from a year earlier, compared with a 4.3% year on-year drop in March.
Trading in US stock index futures indicated gains for US stocks at the opening bell. Trading in US index futures indicated that the Dow Jones Industrial Average could gain 99.50 points at the opening bell today, 10 May 2016. Most US stocks edged higher yesterday, 9 May 2016, as gains for drug companies were almost cancelled by sharp losses for metals and energy companies. Minneapolis Fed President Neel Kashkari said in a speech yesterday, 9 May 2016, that he supported the current dovish stance of the Federal Reserve. Chicago Fed President Charles Evans said in a speech in London yesterday, 9 May 2016, that a stronger labor market is underpinning growth prospects. The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 14-15 June 2016.
Closer home, the market breadth indicating the overall health of the market once again turned positive from negative in afternoon trade. On BSE, 1,245 shares rose and 1,118 shares declined. A total of 134 shares were unchanged. The breadth had turned negative from positive in early afternoon trade. The BSE Mid-Cap index was currently up 0.31%. The BSE Small-Cap index was currently up 0.31%. Both these indices underperformed the Sensex.
Shares of oil exploration and production (E&P) firms edged lower after overnight sharp slide in crude oil prices. Cairn India (down 2.74%), Oil India (down 1.67%) and ONGC (down 1.28%) declined. Lower crude oil prices will result in lower realization from crude sales for oil exploration firms.
Index heavyweight Reliance Industries was down 0.1% at Rs 982. The stock hit a high of Rs 984 and a low of Rs 978.05 so far during the day.
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Shares of public sector oil marketing companies (PSU OMCs) also declined. BPCL (down 0.8%), Indian Oil Corporation (down 0.36%) and HPCL (down 0.42%) edged lower.
Aviation stocks edged higher after overnight sharp slide in crude oil prices. SpiceJet (up 1.32%), InterGlobe Aviation (up 1.07%) and Jet Airways (India) (up 1.19%) rose. Lower crude oil prices benefit aviation firms as jet fuel prices, which typically constitute about 50% of airlines' operating costs, are directly linked to international crude oil prices.
In global commodities markets, Brent for July settlement was currently up 67 cents at $44.30 a barrel. The contract had tumbled $1.74 a barrel or 3.83% to settle at $43.63 a barrel during the previous trading session on indications wildfires may not have the impact previously feared on Canadian crude output.
Deepak Nitrite rose 1.76% at Rs 72.30 after net profit rose 35% to Rs 20.56 crore on 1.7% rise in net sales to Rs 335.83 crore in Q4 March 2016 over Q4 March 2015. Earnings before interest, taxation, depreciation and amortization (EBITDA) rose 24.9% to Rs 46.63 crore in Q4 March 2016 over Q4 March 2015. EBITDA margin increased by 250 basis points to 13.7% in Q4 March 2016 over Q4 March 2015 due to further improvement in product mix towards higher value products, strong growth in contribution of the fine and specialty chemicals segment and stable spreads in some of the key products in bulk chemicals and commodities segment. Cost management initiatives have also supported the improved profitability profile, Deepak Nitrite said.
Deepak Nitrite said that the outlook for the current financial year is promising as the company continues to deliver value-led growth in all the three strategic business units of bulk chemicals and commodities, fine and speciality chemicals and fluorescent whitening agents. Stability in crude oil prices would further support this momentum, the company said. The result was announced after market hours yesterday, 9 May 2016.
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