Key benchmark indices hovered in a small range in morning trade. At 10:15 IST, the barometer index, the S&P BSE Sensex was up 14.31 points or 0.06% at 25,414.03. The Nifty 50 index was currently up 5.75 points or 0.07% at 7,789.15. Gains from positive Asian stocks were offset by market regulator Securities and Exchange Board of India (Sebi)'s announcement of tightening the eligibility and investment norms for Offshore Derivative Instruments (ODI) issuers and subscribers for the past few years.
The Sensex rose 99.23 points or 0.39% at the day's high of 25,498.95 in morning trade. The barometer index fell 19.97 points or 0.07% at the day's low of 25,379.75 in early trade. The Nifty rose 27.70 points or 0.35% at the day's high of 7,811.10 in morning trade. The index fell 10 points or 0.12% at the day's low of 7,773.40 in early trade.
In overseas markets, Asian markets rose, shrugging off the weak cues overnight from Wall Street. US stocks ended lower yesterday, 19 May 2016 on mounting fears that the Federal Reserve's next interest-rate hike could come as early as June. Ratings agency Moody's yesterday, 19 May 2016 cut its 2016 forecast for US economic growth to 2%, down from 2.3%. Different Fed officials offered further hawkish commentary yesterday, 19 May 2016, which momentarily amplified the market's rate-hike worries. New York Fed President William Dudley said an interest-rate increase in June or July is possible if fresh data confirm his optimistic forecast of economic growth. Richmond Fed President Jeffrey Lacker defended the Fed's hawkish stance in an interview with a news agency yesterday, 19 May 2016, saying the case is pretty strong for a June hike.
Closer home, the market breadth indicating the overall health of the market turned negative from positive. On BSE, 1,027 shares declined and 792 shares rose. A total of 116 shares were unchanged. The BSE Mid-Cap index was currently off 0.1%. The BSE Small-Cap index was currently off 0.44%. Both these indices underperformed the Sensex.
Shares of index heavyweight and cigarette major ITC rose 1.28% to Rs 329 ahead of its Q4 March 2016 results today, 20 May 2016. The stock hit a high of Rs 329.50 and low of Rs 325.65 so far during the day.
FMCG stocks rose. GlaxoSmithkline Consumer Healthcare (up 0.26%), Dabur India (up 0.53%), Godrej Consumer Products (up 0.7%), Nestle India (up 0.13%), Tata Global Beverages (up 0.79%) and Bajaj Corp (up 0.61%) rose. Colgate-Palmolive (India) (down 0.18%), Hindustan Unilever (down 0.05%), Marico (down 0.3%), Procter & Gamble Hygiene and Health Care (down 0.71%) declined.
Shares of biscuits major Britannia Industries rose 0.69% ahead of its Q4 March 2016 results today, 20 May 2016.
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Pharma shares rose. Glenmark Pharmaceuticals (up 2.7%), Wockhardt (up 0.19%), Dr Reddy's Laboratories (up 0.14%), Sun Pharmaceutical Industries (up 0.25%), Alkem Laboratories (up 0.22%) and GlaxoSmithKline Pharmaceuticals (up 0.91%) rose. Cipla (down 1.6%), Cadila Healthcare (down 0.68%), Aurobindo Pharma (down 0.69%) fell.
Shares of pharma major Lupin dropped 7.3% on concerns surrounding its Goa facility which is under the scanner of USFDA. As per reports, Lupin depends on Goa facility for about 40% of its US sales. The Lupin stock had gained 1.43% to settle at Rs 1,655.80 yesterday, 19 May 2016 after the company reported 47.5% rise in consolidated net profit to Rs 807.10 crore on 34% growth in net sales to Rs 4091.30 crore in Q4 March 2016 over Q4 March 2015. The result was announced during market hours yesterday, 19 May 2016. The Q4 March 2016 results are not strictly comparable with Q4 March 2015 results due to the acquisition of GAVIS Pharmaceuticals LLC, USA, Novel Laboratories, Inc., USA and VGS Holdings, Inc., USA (GAVIS) with effect from 8 March 2016.
Pidilite Industries rose 3.58% after consolidated net profit rose 89.24% to Rs 152.60 crore on 19.66% increase in total income to Rs 1259.47 crore in Q4 March 2016 over Q4 March 2015. The announcement was made after market hours yesterday, 19 May 2016.
GHCL surged 7.04% after net profit rose 54.5% to Rs 78.96 crore on 1.5% growth in net sales to Rs 647.42 crore in Q4 March 2016 over Q4 March 2015. The result was announced after market hours yesterday, 19 May 2016.
Market regulator Securities and Exchange Board of India (Sebi) in its board meeting held yesterday, 19 May 2016 announced tightening the eligibility and investment norms for Offshore Derivative Instruments (ODI) issuers and subscribers for the past few years. In order to bring about an uniformity in the know-your client (KYC)/ anti- money laundering (AML) norms, it has been decided that Indian KYC/AML norms will now be applicable to all ODI issuers, Sebi said. The KYC/AML norms applicable to ODI issuers will be the same as that for all other domestic investors, it added. In order to tighten the ODI regime and have more control over issuance and transfer of ODIs, it has been decided that the ODI subscribers will have to seek prior permission of the original ODI issuer for further/onward issuance/transfer of ODIs, Sebi said. The Sebi board decided that in the monthly reports on ODIs all the intermediate transfers during the month would be required to be reported. The KYC review shall be done on the basis of the risk criteria as determined by the ODI issuers, as at the time of on-boarding and once every three years for low risk clients and at the time of on-boarding and every year for all other clients, Sebi said.
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