After extending gains in afternoon trade, key benchmark indices traded off high in mid-afternoon trade. At 14:22 IST, the barometer index, the S&P BSE Sensex, was up 152.07 points or 0.59% at 25,762.28. The 50-unit CNX Nifty was up 43.85 points or 0.56% at 7,833.15. On the macro front, the latest data showed pick up in industrial production growth in July, a benign current account deficit in Q1 June 2015 and wholesale prices remaining in negative zone for the 10th month in a row in August 2015.
Shares of power sector companies gained on media reports that Prime Minister Narendra Modi is set to meet bosses of loss-making state government-run electricity utilities today, 14 September 2015, to debate a rescue package for the power transmission and distribution sector.
The market breadth indicating the overall health of the market was strong. On BSE, 1,587 shares rose and 918 shares declined. A total of 95 shares were unchanged. The BSE Mid-Cap index was up 1.08%. The BSE Small-Cap index was up 0.68%. Both these indices outperformed the Sensex.
In overseas equity markets, stocks in China and Japan edged lower after Chinese data released over the weekend showed growth in China's factory output and fixed-asset investment were both weaker than expected in August 2015, a month when Beijing temporarily closed some factories ahead of a high-profile military parade.
US stocks edged higher during the previous trading session on Friday, 11 September 2015, on speculation the US Federal Reserve will not hike interest rates this month due to concerns about global growth and amid a recent turmoil in global equity markets. The Fed's policy-making committee holds a two-day meeting on 16 and 17 September 2015. The Fed has held its benchmark short-term interest rate near zero since December 2008.
Closer home, pharma stocks edged higher on renewed buying. Strides Arcolab (up 4.64%), Glenmark Pharmaceuticals (up 2.69%), Wockhardt (up 0.9%), Sun Pharmaceutical Industries (up 1.08%), Divi's Laboratories (up 1.24%), Cipla (up 0.74%), Ipca Laboratories (up 0.28%) and Lupin (up 0.12%) edged higher. GlaxoSmithkline Pharmaceuticals (down 0.72%) edged lower.
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Dr Reddy's Laboratories (DRL) rose 0.14% at Rs 4,011. The stock hit a high of Rs 4,019.25 and a low of Rs 3,982 so far during the day. DRL during market hours today, 14 September 2015, announced the signing of a commercialization deal with Hatchtech, an Australian pharmaceutical company which is developing an innovative prescription head lice product, Xeglyze Lotion. The exclusive rights for this product are applicable for the territories of the United States, Canada, India, Russia and the CIS, Australia, New Zealand and Venezuela, DRL said in a statement. As part of the agreement, DRL will pay Hatchtech an upfront amount of $10 million and a sum of up to $50 million based on pre commercialization milestones. DRL will also pay an undisclosed amount to Hatchtech based on post commercialization milestones linked to achievement of annual net sales targets for the product.
Additionally, Hatchtech announced it will be filing its new drug application (ANDA) for Xeglyze with the US Food and Drug Administration (FDA) today, 14 September 2015. If approved, the product will be marketed in the United States by Promius Pharma, a wholly-owned specialty company of DRL.
Auto stocks were mostly higher. Tata Motors (up 1%), Ashok Leyland (up 1.2%), Hero MotoCorp (up 0.06%) and Mahindra & Mahindra (up 0.76%) edged higher. Eicher Motors (down 0.22%), Bajaj Auto (down 0.54%) and TVS Motor Company (down 0.3%) edged lower.
Maruti Suzuki India (MSIL) rose 0.17% at Rs 4,324.75. The stock hit a high of Rs 4,345 and a low of Rs 4,287.35 so far during the day. MSIL on Saturday, 12 September 2015, announced the introduction of two new variants Vxi (O) and Vdi (O) of its popular premium sedan Ciaz. The ex-showroom price at Delhi for Ciaz Vxi (O) variant is Rs 7.48 lakh while for Vdi (O) it is Rs 8.37 lakh.
Shares of power sector companies gained on media reports that Prime Minister Narendra Modi is set to meet bosses of loss-making state government-run electricity utilities today, 14 September 2015, to debate a rescue package for the power transmission and distribution sector. Adani Power (up 5.84%), Reliance Power (up 5.49%), Reliance Infrastructure (up 4.39%), NTPC (up 3.97%), JSW Energy (up 2.26%), Tata Power (up 2.1%), GVK Power & Infrastructure (up 2.18%), Power Grid Corporation of India (up 1.21%) and Torrent Power (up 1.14%) edged higher. NHPC (down 0.31%) edged lower.
Media reports suggested that the government has identified $66 billion of troubled debt held by state government-run electricity utilities as a major obstacle to efforts to speed up growth in the country.
Jaiprakash Power Ventures rose 3.96% at Rs 6.04. The company on Saturday, 12 September 2015, announced that its 400 megawatts (MW) Vishnuprayag hydro power plant, which was temporarily shut down with effect from 25 June 2015, has resumed power generation with effect from 11 September 2015. The company had to suspend operations at the power plant in June 2015 due unprecedented flood in river Alakhnanda.
Tech Mahindra rose 0.29% at Rs 526.20. The stock hit a high of Rs 529.50 and a low of Rs 517 so far during the day. Tech Mahindra during market hours today, 14 September 2015, announced that Real-Time Innovations (RTI), the industrial Internet of Things connectivity platform company, announced a global partnership with the company. Tech Mahindra has joined RTI's rapidly expanding Services Delivery Partner (SDP) program designed to help companies capitalize on the growing Industrial Internet of Things (IIoT) market. Combined efforts of RTI and Tech Mahindra will help companies meet the emerging and dynamic requirements of the IIoT market in key verticals including energy, automotive, avionics, healthcare and telecommunications across the globe, Tech Mahindra said in a statement.
Asian Paints edged higher after the company said that as part of the company's plan to consolidate its investments in the overseas subsidiaries, Asian Paints (International), Mauritius, a wholly owned subsidiary of the company has transferred its entire holding of 49% held in the subsidiary company viz., Asian Paints (Middle East) LLC and 100% of holding in the subsidiary company viz., Asian Paints (Tonga) to Berger International, Singapore, a wholly owned subsidiary of Asian Paints (International). The stock rose 2.27% at Rs 833. The announcement was made during market hours today, 14 September 2015.
Siemens rose after the company announced that it has won a crucial order approximately worth Rs 81 crore from Diesel Locomotive Works (DLW), Varanasi. The stock was up 1.57% at Rs 1,294. The announcement was made during trading hours today, 14 September 2015.
On the macro front, lower global crude oil prices and a recovery in the rupee against the dollar augur well for India. India imports about 80% of its crude requirements and lower crude oil prices ease concerns on fiscal deficit, inflation and gives more room for the government to boost growth through spending on infrastructure. In the global commodities markets, Brent for October settlement was currently off 58 cents at $47.56 a barrel. The contract had fallen 75 cents or 1.53% to settle at $48.14 a barrel during the previous trading session. The Brent October contract expires tomorrow, 15 September 2015. Brent for November settlement was currently off 55 cents at $48.49 a barrel.
A recovery in the rupee against the dollar has eased concerns about higher crude import costs. In the foreign exchange market, the partially convertible rupee was hovering at 66.355, compared with its close of 66.53 during the previous trading session. A weak rupee raises the cost of imports.
Meanwhile, the annual rate of inflation based on monthly wholesale price index (WPI) stood at minus 4.95% (provisional) for the month of August 2015 compared to minus 4.05% (provisional) for the previous month and 3.85% during the corresponding month of the previous year, according to the data released by the government during market hours today, 14 September 2015.
Meanwhile, data released after market hours on Friday, 11 September 2015 showed that India's current account deficit (CAD) narrowed to $6.2 billion (1.2% of GDP) in Q1 June 2015 from $7.8 billion (1.6% of GDP) a year ago. This improvement was mainly on account of the merchandise trade deficit ($34.2 billion during Q1 June 2015) which contracted on a year-on-year (y-o-y) basis due to a larger absolute decline in merchandise imports relative to merchandise exports. The reduction in the CAD was also enabled by higher net earnings through services and lower outflow on account of primary income (profit, dividend and interest).
Another data released after market hours on Friday, 11 September 2015, showed that India's index of industrial production (IIP) increased 4.2% in July 2015 over a year ago compared with the revised growth of 4.4% in June 2015. The IIP growth for June 2015 has been scaled up 4.4% in the first revision compared with 3.8% reported provisionally.
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