Key benchmark indices edged lower in early trade as weakness in Asian stocks weighed on sentiment. At 9:25 IST, the barometer index, the S&P BSE Sensex was down 80.71 points or 0.31% at 25,709.51. The Nifty 50 index was currently down 24.65 points or 0.31% at 7,875.75.
In overseas stock markets, Asian stocks dropped as crude oil retreated and technology shares declined after Apple Inc. sank to the lowest since June 2014. US stocks closed mostly lower yesterday, 12 May 2016 weighed by declines in health care and technology stocks.
Closer home, the market breadth indicating the overall health of the market was positive. On BSE, 625 shares rose and 491 shares fell. A total of 61 shares were unchanged. The BSE Mid-Cap index was currently up 0.24%. The BSE Small-Cap index was currently up 0.2%. Both these indices outperformed the Sensex.
Nestle India rose 2.56%. The company's net profit fell 19.13% to Rs 259 crore on 8.5% decline in total income from operations (net) to Rs 2302.46 crore in Q1 March 2016 over Q1 March 2015. The result hit the market after trading hours yesterday, 12 May 2016. The company said that the Maggi Noodles issue adversely impacted the financial performance in the first quarter. Nestle relaunched Maggi noodles in the market at the beginning of November 2015 after it withdrew the product from the market in June 2015 amid allegations that it contained high levels of lead.
Nestle India's Chairman and Managing Director Suresh Narayanan said that Maggi noodles has already regained leadership with over 50% market share within 5 months of relaunch. He said that Nestle India is gearing up for volume growth with renewed focus and commitment on consumer relevant innovation and renovation. Narayanan said that the management is working on increasing penetration for all product categories of the company including milk & nutrition, chocolate & confectionary and coffee & beverages. Narayanan said that the company's Q1 March 2016 results show further improvement in sequential performance, both in sales and profit margins.
Bank of Baroda dropped 2.48% ahead of its Q4 March 2016 results today, 13 May 2016.
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Dr Reddy's Laboratories (down 1.64%), Bharti Airtel (down 1.45%) and ICICI Bank (down 1.21%) were the major losers from the Sensex pack.
Among macro data, inflation based on consumer price index (CPI) surged to 5.39% in April 2016 from six months low of 4.8% recorded in March 2016. The corresponding provisional inflation rate for rural area was 6.09% and urban area 4.68% in April 2016 as against 5.70% and 3.95% in March 2016. The core CPI inflation rose to 4.76% in April 2016 from 4.54% in March 2016.
Industrial production (IIP) growth moderated to 0.1% in March 2016 over March 2015 compared with 2% growth recorded in February 2016. The electricity generation surged at double-digit pace of 11.3% in March 2016. However, the mining output declined 0.1% and manufacturing production dipped 1.2% contributing to the overall slower growth in industrial output in March 2016. Both, CPI and IIP data were announced after market hours yesterday, 12 May 2016.
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