A bout of volatility was witnessed in afternoon trade as key benchmark indices trimmed gains after extending intraday gains. At 13:20 IST, the barometer index, the S&P BSE Sensex, was up 79.11 points or 0.29% at 27,705.80. The Nifty 50 index was currently up 24.80 points or 0.29% at 8,492.70. The Nifty trimmed gains after hitting its fresh highest level in almost eleven months in afternoon trade. Gains in global stocks underpinned sentiment on the domestic bourses.
The Nifty gained 37.30 points or 0.44% at the day's high of 8,505.20 in afternoon trade, its highest level since 19 August 2015. The index rose 11.30 points or 0.13% at the day's low of 8,479.20 in morning trade. The Sensex gained 134.12 points or 0.49% at the day's high of 27,760.81 at the onset of trading session, its highest level since 20 August 2015. The barometer index rose 41.12 points or 0.15% at the day's low of 27,667.81 in morning trade.
The market breadth indicating the overall health of the market was negative. On BSE, 1,366 shares declined and 1,195 shares rose. A total of 137 shares were unchanged. The BSE Mid-Cap index was currently up 0.56%, outperforming the Sensex. The BSE Small-Cap index was currently up 0.12%, underperforming the Sensex.
In overseas stock markets, European stocks edged higher in early trade adding to recent gains after recent better American jobs data, a more optimistic view of corporate earnings and hopes for continued support from the world's central banks. Japanese stocks led gains in Asian equities as investors gained confidence in Japanese Prime Minister Shinzo Abe's ruling coalition, which increased its control in the upper house of parliament after election for the upper house held on 10 July 2016. The Nikkei 225 Average closed 2.46% higher. Anticipation was also growing that Abe would soon introduce a fresh fiscal stimulus package to help the stagnant economy. Speculation was also growing that an expected meeting between former US Federal Reserve Chairman Ben Bernanke and Abe today, 12 July 2016, would include talks about a radical measure in which a central bank directly funds government spending. The Nikkei 225 Average surged 4% yesterday, 11 July 2016, registering its biggest daily-percentage gain since 2 March 2016, as Abe's ruling-coalition victory in the upper-house election stoked speculation of more fiscal stimulus.
US stocks edged higher yesterday, 11 July 2016, with the S&P 500 index hitting record high on intraday as well as on closing basis as investors bought stocks amid a reinvigorated appetite for assets perceived as risky following a surprisingly strong jobs report for June 2016 released during trading hours in the US on Friday, 8 July 2016.
ICICI Bank rose 2.86%. The bank said that S&P Global Ratings affirmed its 'BBB-' long-term issue ratings on the senior unsecured bonds issued by the Bahrain branch of ICICI Bank (foreign currency: BBB-/Stable/A-3). The rating agency said it removed the ratings from CreditWatch, where they were placed with negative implications on 22 February 2016. At the same time, it raised the Greater China regional scale rating on ICICI Bank's CNY600 million 4% bonds maturing 2017 to 'cnA-' from 'cnBBB+', and removed it from CreditWatch, where it was placed with developing implications on 22 February 2016. Australian-dollar- and Chinese renminbi-denominated irrevocable and unconditional standby letters of credit (SBLCs) provided by the DIFC branch of ICICI Bank support these bonds.
The rating agency has equalized the ratings on the bonds with the ratings on ICICI Bank. This reflects its opinion that the credit quality of these bonds has improved because it views the SBLC provider as an additional source of repayment and assume that the trustee will deliver the demand notice in time. The SBLCs are irrevocable, unconditional, and provide timely and sufficient coverage for the bonds' principal and interest repayment obligations. The SBLCs mitigate exposure to ICICI Bank's Bahrain branch by substituting the credit risk of the SBLC provider in its place. The announcement was made during market hours today, 12 July 2016.
Pharma stocks declined. Glenmark Pharmaceuticals (down 1.03%), Aurobindo Pharma (down 1.12%), Cipla (down 0.97%), Dr Reddy's Laboratories (down 0.53%), Cadila Healthcare (down 0.69%), and Sun Pharmaceutical Industries (down 0.67%) declined. Lupin (up 0.42%), Alkem Laboratories (up 1.18%) and Divi's Laboratories (up 1.42%) gained.
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The BSE Healthcare index had outperformed the market over the past one month till 11 July 2016, rising 9.06% compared with 3.72% rise in the Sensex. The index had, however, underperformed the market in past one quarter, gaining 6.73% as against Sensex's 10.41% rise.
Suven Life Sciences rose 1.64% after the company secured one product patents each in India and South Africa corresponding to the New Chemical Entities (NCEs) for the treatment of disorders associated with Neurodegenerative diseases.
Shares of power generation and power distribution companies were mixed. Torrent Power (down 0.54%), Tata Power Company (down 1.02%), Adani Power (down 0.51%), and Reliance Power (down 0.09%) declined. GVK Power & Infrastructure (up 0.16%), NHPC (up 0.2%), NTPC (up 0.95%), Power Grid Corporation of India (up 0.36%), and Reliance Infrastructure (up 0.2%) gained.
Shares of PSU Coal mining major Coal India lost 1.03% to Rs 317.20 after the company said its board approved buyback of shares at a price of Rs 335 per share. The announcement was made after market hours yesterday, 11 July 2016. Coal India announced that its board of directors at a meeting held yesterday, 11 July 2016, approved the buyback of equity shares not exceeding 10.89 crore shares of the company, from all the shareholders holding equity shares of the company as on record date on a proportionate basis through the tender offer route. The buyback price was fixed at Rs 335 per share payable in cash for an aggregate consideration not exceeding Rs 3650 crore which is not exceeding 25% of the aggregate fully paid up share capital and free reserves of the company as per audited accounts of the company for the financial year ended 31 March 2016.
The BSE Power index had outperformed the market over the past one month till 11 July 2016, rising 5.23% compared with 3.72% rise in the Sensex. The index had also outperformed the market in past one quarter, gaining 11.03% as against Sensex's 10.41% rise.
Rico Auto Industries rose 4.76% after the company said it has laid the foundation stone on 7 July 2016 for a new manufacturing plant at Pathredi, Bhiwadi in Rajasthan for the manufacturing of auto components. The announcement was made after market hours yesterday, 11 July 2016. Rico Auto said that the factory premises is being built on a plot of 11.3 acres. Latest manufacturing technology would be implemented in the new facility. The company is hopeful to start commercial production at the new plant by the next financial year.
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