Key benchmark indices held firm and hovered close to their intraday highs in mid-afternoon trade. At 14:20 IST, the barometer index, the S&P BSE Sensex, rose 179.27 points or 0.52% at 34,950.32. The Nifty 50 index rose 45.05 points or 0.42% at 10,745.50. The announcement of reduction in additional borrowing by the government allaying fiscal deficit concerns and expectation of big ticket changes in the Goods and Services Tax (GST) in the GST council's next meet boosted sentiment. Indices bucked weak trend in global stocks.
Indices opened slightly lower and swung between the gains and losses in early trade. Stocks extended gains in morning trade and held firm later during the session. Buying momentum picked up pace in afternoon trade with the Sensex scaling fresh record high. Indices hovered close to their intraday highs in mid-afternoon trade.
Among the secondary indices, the S&P BSE Mid-Cap index rose 0.23%. The S&P BSE Small-Cap index gained 0.02%. Both these indices underperformed the Sensex. The side indices recovered after witnessing sharp fall earlier in the day.
The market breadth indicating health of the market was negative. On the BSE, 1,604 shares declined and 1,228 shares rose. A total of 137 shares were unchanged.
Pharma stocks gained on renewed buying. Aurobindo Pharma (up 2.51%), Lupin (up 1.24%), Wockhardt (up 0.93%), Dr Reddy's Laboratories (up 1.34%), Divi's Laboratories (up 0.96%), Glenmark Pharmaceuticals (up 0.34%) and Cadila Healthcare (up 0.07%) gained. Cipla lost 0.03%.
Sun Pharmaceutical Industries rose 0.93% after the company announced that its wholly-owned subsidiaries have reached an agreement with Ironwood Pharmaceuticals, Inc. and Allergan plc (together known as the companies) to resolve the patent litigation regarding submission of an abbreviated new drug application (ANDA) for a generic version of Linzess (Linaclotide capsules) in the US. The announcement was made after market hours yesterday, 16 January 2018.
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Pursuant to the terms of the settlement, the companies will grant the wholly owned subsidiaries of Sun Pharma, a license to market a generic version of Linzess in the United States beginning 1 February 2031 (subject to US drug regulator's approval) or earlier under certain circumstances. As a result of the settlement, all Hatch-Waxman litigation between Sun Pharma and the companies, regarding the Linzess patents, will be dismissed. Additional details regarding the settlement were not disclosed. The agreement is subject to customary regulatory approvals.
Shares of power generation and power distribution companies were mixed. NHPC (up 0.66%), Power Grid Corporation of India (up 0.92%), and Reliance Power (up 0.59%) gained. Torrent Power (down 0.39%), NTPC (down 0.29%) and Adani Power (down 2.13%), Reliance Infrastructure (down 0.8%) and Tata Power Company (down 0.96%) declined.
Shares of psu coal mining major Coal India dropped 0.31%.
Zee Entertainment Enterprises declined 1.32%. The company's consolidated net profit rose 28.28% to Rs 321.72 crore on 11.5% rise in total revenue to Rs 1886.11 crore in Q3 December 2017 over Q3 December 2016. The announcement was made during market hours today, 17 January 2018.
Bharat Forge rose 1.59% after the company said that it opened a research & development facility in MIRA Technology Park, UK. The announcement was made during trading hours today, 17 January 2018. MIRA Technology Park is a leading automotive technology park and enterprise zone in UK. Bharat Forge said it will be developing components and sub-systems focused on electric vehicles.
State Bank of India rose 2.62% to Rs 303.90 after a bulk deal of 16.57 lakh shares was executed on the scrip at Rs 298.05 per share at 10:46 IST on BSE. On 11 January 2018, SBI had said that a proposal will be submitted to executive committee of central board (ECCB) today, 17 January 2018, for approval for issuance of long term bonds of Rs 20000 crore for financing of infrastructure and affordable housing in domestic and overseas market.
On the macro front, Ministry of Finance said that upon a review of trends of revenue receipts and expenditure pattern, it has been assessed that additional borrowing of only Rs 20000 crore of government securities would be adequate to meet financing needs. Government did not accept borrowings of Rs 15000 crore in last three auctions. Remaining Rs 15000 crore would be reduced from the notified borrowing programme of ensuing weeks. Vide the Press Release dated 27 December 2017, government had stated that it will raise additional market borrowing of Rs 50000 crore through dated government securities in the current financial year, 2017-18.
Meanwhile, country's six-month old revamped indirect tax system is reportedly set to undergo significant changes, which will include simplification of return filing process, amendment in laws and rules to simplify procedures, along with rate cuts of around 70 goods and services. The Goods and Services Tax (GST) Council - the apex body for decision making headed by finance minister Arun Jaitley - is reportedly likely to consider the big bang recommendations from states and various officers' panel in its next meeting tomorrow, 18 January 2018.
Overseas, European stocks declined. Asian stocks were mixed. Japanese orders for machinery surged to their highest level in a decade in November. Cabinet Office data showed core orders, a highly volatile data series regarded as an indicator of capital spending in the coming six to nine months, grew 5.7% in November from the previous month.
US benchmark indices pulled back from lifetime highs set earlier in the session to end mostly lower yesterday, 16 January 2018, on likely profit booking amid concerns over the possibility of a government shutdown. On the data front, the Empire State manufacturing survey slipped to 17.7 in January from a revised 19.6 in December, the New York Fed said.
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