A bout of volatility was witnessed as key benchmark indices extended gains after trimming intraday gains in mid-morning trade. At 11:15 IST, the barometer index, the S&P BSE Sensex, was up 129.85 points or 0.52% at 25,231.58. The gains for the Nifty 50 index were lower than the Sensex's gains in percentage terms. The Nifty was currently up 25.40 points or 0.33% at 7,731.95.
The Sensex rose 163.76 points or 0.65% at the day's high of 25,265.49 in morning trade, its highest level since 3 May 2016. The barometer index rose 61.21 points or 0.24% at the day's low of 25,162.94 in morning trade. The Nifty rose 36.95 points or 0.47% at the day's high of 7,743.50 in morning trade. The index rose 8.05 points or 0.1% at the day's low of 7,714.60 in morning trade.
The market breadth indicating the overall health of the market was positive. On BSE, 1,095 shares rose and 924 shares declined. A total of 102 shares were unchanged. The BSE Mid-Cap index was currently up 0.09%. The BSE Small-Cap index was currently up 0.23%. Both these indices underperformed the Sensex.
In overseas stock markets, Asian stocks edged lower on data showing slowdown in growth in China's services sector last month. The China Caixin services purchasing managers' index (PMI) dropped to 51.8 in April from 52.2 in March. China's official nonmanufacturing PMI, a competing gauge, fell to 53.5 in April from 53.8 in March, according to data released on 1 May 2016. China's economy is the world's second biggest economy. In mainland China, the Shanghai Composite index was currently down 0.18%. In Hong Kong, the Hang Seng index was currently down 0.28%.
US stocks edged lower yesterday, 4 May 2016, after weaker-than-expected private-sector job data. The ADP employment data showed that private payrolls across the US rose by 156,000 last month. The increase is the smallest since April 2013. The report is seen as a precursor to the top-tier nonfarm-payrolls data due on Friday, 6 May 2016. The nonfarm-payrolls data has implications for the US monetary policy. The US central bank's mandate centers on maximizing employment and keeping inflation at a 2% target level. The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 14-15 June 2016.
Power generation and distribution stocks were mixed after the Union Cabinet yesterday, 4 May 2016, gave its approval for allowing flexibility in utilisation of domestic coal for reducing the cost of power generation. Torrent Power (up 1.11%), Reliance Infrastructure (up 0.96%), NHPC (up 0.73%), NTPC (up 0.54%), Tata Power Company (up 0.64%), GMR Infrastructure (up 0.25%) and Power Grid Corporation of India (up 0.21%) edged higher. Adani Power (down 1.15%), CESC (down 1.22%), Jaiprakash Power Ventures (down 0.22%), JSW Energy (down 0.08%) and Reliance Power (down 0.3%) edged lower.
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The objective of the proposal is to allow flexibility in optimal use of domestic coal in efficient generating stations resulting in reduction in the cost of electricity generation and reduce the power purchase cost of state distribution companies. This proposal is also in line with the UDAY scheme of Government of India which also envisages liberally allowing of coal swaps from inefficient plants to efficient plants and from plants situated away from coal mines to pit head to minimize cost of coal transportation thus leading to reduction in cost of power.
Shares of state-run coal mining giant Coal India were up 0.48% at Rs 281.20.
Shares of public sector oil marketing companies (PSU OMCs) declined as crude oil prices rose. BPCL (down 1.23%), HPCL (down 2.33%) and Indian Oil Corporation (down 1.72%) edged lower. Higher crude oil prices could increase under-recoveries of PSU OMCs on domestic sale of LPG and kerosene at controlled prices. The government has already freed pricing of petrol and diesel.
Shares of oil exploration and production (E&P) firms were mixed. Cairn India (down 0.29%) and Oil India (down 1.75%) declined. ONGC (up 0.57%) edged higher.
Index heavyweight Reliance Industries was up 0.02% at Rs 977.65. The stock hit a high of Rs 983.50 and a low of Rs 975.75 so far during the day.
Crude prices edged higher in the global commodities markets as a huge wildfire in Canada disrupted its oil sands production and fighting between rival eastern and western political factions in Libya prevented a cargo belonging to trading giant Glencore from loading. Brent for July settlement was currently up 65 cents at $45.27 a barrel. The contract had declined 35 cents or 0.77% to settle at $44.62 a barrel during the previous trading session after a report from the US Department of Energy showed a larger-than-expected weekly build of crude stockpiles in the US.
Index heavyweight and housing finance major HDFC rose 2.34% at Rs 1,157.50, with the stock extending post-result gains. HDFC's net profit rose 39.98% to Rs 2607.05 crore on 23.72% growth in total income to Rs 9225.72 crore in Q4 March 2016 over Q4 March 2015. The surge in net profit was due to profit on sale of a part of its stake in the life insurance joint venture to the company's joint venture partner Standard Life. The company announced its Q4 March 2016 results during market hours on 2 May 2016.
HDFC after trading hours yesterday, 4 May 2016, announced that it intends to raise Rs 1135 crore through private placement of senior secured redeemable non-convertible debentures. HDFC said that the coupon rate of debentures is 8.34% per annum with a tenor of 2 years and 10 months. The issue opens and closes on the same day on 6 May 2016. The object of the issue is to augment the long-term resources of the company.
V-Guard Industries jumped 19.45% at Rs 1,181.50 after net profit surged 109.1% to Rs 41.97 crore on 16% rise in net sales to Rs 510.07 crore in Q4 March 2016 over Q4 March 2015. The result was announced after market hours yesterday, 4 May 2016.
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