Key benchmark indices slipped into the red and were trading with small losses in mid-morning trade after the private survey showed that Indian manufacturing activity contracted in July. At 11:20 IST, the barometer index, the S&P BSE Sensex, was down 47.33 points or 0.15% at 32,467.61. The Nifty 50 index was down 3.20 points or 0.03% at 10,073.90. Firmness in Asian stocks capped losses.
After opening with a positive bias on firm Asian stocks, key indices traded in a narrow range in positive terrain till morning trade.
The S&P BSE Mid-Cap index rose 0.51%. The S&P BSE Small-Cap index gained 0.08%. Both these indices outperformed the Sensex.
The breadth, indicating the overall health of the market, turned negative from positive. On the BSE, 1,134 shares fell and 1,103 shares rose. A total of 138 shares were unchanged.
Cement stocks gained. ACC (up 0.7%), Ambuja Cements (up 0.65%), and UltraTech Cement (up 0.71%), gained. Shree Cement declined 1.25%.
Grasim Industries advanced 0.86%. Grasim has exposure to the cement sector through its holding in UltraTech Cement.
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Telecom stocks were mixed. Bharti Airtel (up 0.48%), Reliance Communications (up 0.01%) and Idea Cellular (up 0.49%) gained. Tata Teleservices (Maharashtra) (down 2.16%) and MTNL (down 0.48%) declined.
Shares of Bharti Infratel fell 0.01%. Bharti Infratel is a provider of tower and related infrastructure and is a unit of Bharti Airtel.
Maruti Suzuki India rose 2.19% after the company said that total sales rose 20.6% to 1.65 lakh units in July 2017 over July 2016. Domestic sales rose 22.4% to 1.54 lakh units in July 2017 over July 2016. Exports rose 0.1% to 11,345 units in July 2017 over July 2016. The announcement was made during market hours today, 1 August 2017.
VIP Clothing gained 1.84% after the company said that it has filed draft letter of offer for rights issue yesterday, 31 July 2017 with Securities & Exchange Board of India (Sebi), BSE and National Stock Exchange of India (NSE). The company's board at its meeting held on 22 April 2017 approved raising upto Rs 50 crore by rights issue of equity shares. The announcement was made after market hours yesterday, 31 July 2017.
Container Corporation of India gained 2.97% after net profit rose 36.4% to Rs 243.38 crore on 9.9% increase in net sales to Rs 1456.80 crore in Q1 June 2017 over Q1 June 2016. The result was announced after market hours yesterday, 31 July 2017.
On the macroeconomic data front, Markit Economics said today, 1 August 2017 that the introduction of the goods & services tax (GST) weighed heavily on the Indian manufacturing industry in July. New orders and output decreased for the first time since the demonetisation-related downturn recorded in December last year, with rates of contraction the steepest since February 2009 in both cases. At 47.9 in July, down from 50.9 in June, the Nikkei India Manufacturing Purchasing Managers' Index (PMI) was at its lowest mark since February 2009 and highlighted the first deterioration in business conditions in 2017 so far.
Meanwhile, the combined index of eight core industries, comprising 40.27% of the weight of items included in the index of industrial production (IIP) rose 0.4% in June 2017 over June 2016. Its cumulative growth during April to June, 2017-18 was 2.4%.
GDP growth rate of India will remain in the range of 6.5-7.5% over the next 12-18 months and GST will support the momentum for faster growth, reported a study conducted by a leading research agency, Moody's. According to the US-based agency estimates, the economy will grow 7.5% in 2016-17 and 7.7% in 2017-18. While it forecasted that the economic growth will gradually increase to around 8% over the next 3-4 years.
Overseas, most Asian stocks gained on rising confidence in global growth. Growth in China's manufacturing quickened in July, a private survey showed, as output and new orders rose at the fastest pace since February on strong export sales. The Caixin/Markit Manufacturing Purchasing Managers' Index (PMI) rose to 51.1 in July, above the 50-point mark that separates growth from contraction, and well ahead of the 50.4 in June.
In US, the Dow Jones Industrials Average finished at an all-time high yesterday, 31 July 2017, but the broader market's gains were hobbled by losses in the technology sector.
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