Key benchmark indices continued to trade firm in early afternoon trade as firmness in Asian stocks and private data showing rebound in India's manufacturing activity in August boosted sentiment. At 12:20 IST, the barometer index, the S&P BSE Sensex rose 119.08 points or 0.38% at 31,849.57. The Nifty 50 gained 38.80 points or 0.39% at 9,956.70. Domestic data showing Q1 June 2017 gross domestic product falling to a three-year low raised expectations that the central bank may cut rates to perk up growth.
The S&P BSE Mid-Cap index rose 0.93%. The S&P BSE Small-Cap index gained 0.96%. Both these indices outperformed the Sensex.
The broad market depicted strength. There were more than two gainers for every loser on the BSE. 1,580 shares rose and 766 shares fell. A total of 118 shares were unchanged.
After opening higher and witnessing a bout of initial volatility, key indices strengthened and hit fresh intraday high in morning trade. Stocks held firm later during the session.
Auto stocks gained on expectations that the Reserve Bank of India may further cut policy rates to perk up growth after the latest data showed Q1 June 2017 GDP falling to 3-year low. Tata Motors (up 1.1%), Hero MotoCorp (up 1.75%), and TVS Motor Company (up 0.87%) gained. Mahindra & Mahindra (M&M) fell 0.09%. Purchases of automobiles, including that of cars, utility vehicles and commercial vehicles are substantially driven by financing.
Eicher Motors rose 0.74% after total motorcycles sales rose 22% to 67,977 units in August 2017 over August 2016. The announcement was made during trading hours today, 1 September 2017.
Ashok Leyland rose 4.52% after the company's total sales rose 25% to 13,634 units in August 2017 over August 2016. The announcement was made during trading hours today, 1 September 2017. Ashok Leyland's sales of light commercial vehicles (LCV) rose 14% to 3,067 units in August 2017 over August 2016. Sales of medium & heavy commercial vehicles (M&HCV) rose 29% to 10,567 units in August 2017 over August 2016.
Bajaj Auto rose 2.85% after total sales rose 3% to 3.35 lakh units in August 2017 over August 2016. Domestic sales was flat at 2 lakh units in August 2017 over August 2016. Export sales rose 7% to 1.34 lakh units in August 2017 over August 2016. The announcement was made before market hours today, 1 September 2017.
Maruti Suzuki India rose 1.42% after total sales rose 23.8% to 1.63 lakh units in August 2017 over August 2016. Domestic sales rose 26.7% at 1.52 lakh units in August 2017 over August 2016. Export sales fell 4.7% to 11,701 units in August 2017 over August 2016. The announcement was made during market hours today, 1 September 2017.
Pharma stocks also gained. Sun Pharmaceutical Industries (up 0.92%), Aurobindo Pharma (up 2.59%), Lupin (up 1.42%), Wockhardt (up 1.93%), Divi's Laboratories (up 1.79%), Glenmark Pharmaceuticals (up 1.08%) and Cadila Healthcare (up 1.38%) gained. Cipla fell 0.25%.
Alembic Pharmaceuticals gained 0.3% after the company said that it received EU GMP (European Union Good Manufacturing Practice) Certificate for the audit conducted at the company's formulation facility at Panelav in Gujarat from 8 August 2017 to 10 August 2017. The announcement was made after market hours yesterday, 31 August 2017.
Dr Reddy's Laboratories jumped 8.2% after report suggested that the District Court of Delaware has ruled in favour of the company against Reckitt Benckiser for the blockbuster drug Suboxone. Judge Richard Andrews, who presided over the hearing, reportedly said that plaintiffs failed to meet their burden of showing Dr Reddy's infringes the asserted claims of the patent.
Strides Shasun rose 1.99% after the company said its formulations facility in Bangalore, which was inspected by the US Food and Drug Administration (USFDA) in May 2017, has received the Establishment Inspection Report (EIR), thereby confirming the closure of the inspection. The KRS Gardens facility in Bangalore manufactures tablets, capsules, liquids, sachets, creams and ointments. The facility supports important current and future products for the US markets. The announcement was made before trading hours today, 1 September 2017.
In a separate announcement, Strides Shasun announced after market hours yesterday, 31 August 2017, that Arrow Pharmaceuticals, Australia, a subsidiary of Strides Pharma Global, Singapore has acquired the Australian operations of Amneal Pharmaceuticals.
On macro data front, which were released after market hours yesterday, 31 August 2017, gross domestic product (GDP) at constant (2011-12) prices in Q1 June 2017 is estimated at Rs 31.10 lakh crore, as against Rs 29.42 lakh crore in Q1 June 2016, showing a growth rate of 5.7%. Quarterly gross value added (GVA) at basic price at constant (2011-2012) prices for Q1 of 2017-18 is estimated at Rs 29.04 lakh crore, as against Rs 27.51 lakh crore in Q1 June 2016, showing a growth rate of 5.6%.
The eight core industries comprising 40.27% of the weight of items included in the index of industrial production (IIP) rose 2.4% in July. Its cumulative growth during April to July, 2017-18 was 2.5%.
The fiscal deficit stood at Rs 5.05 trillion ($79.01 billion) for April-July or 92.4% of the budgeted target for the current fiscal year that ends in March 2018, showed a data released by the government. The data furnished by the Comptroller General of Accounts (CAG), showed that the deficit was 73.7% of the full-year target during the corresponding period last year. Net tax receipts in the first four months of the financial year 2017-18 were Rs 2.58 trillion, the data added. The government aims to trim the fiscal deficit to 3.2% of gross domestic product (GDP) in 2017-18 compared with 3.5% in the previous year.
Markit Economics said today, 1 September 2017 that August saw a rebound in manufacturing new orders and output across India. The expansions were modest, but represented a substantial turnaround from July's GST-related contraction. Up from July's 101-month low of 47.9 to 51.2 in August, the Nikkei India Manufacturing Purchasing Managers' Index (PMI) signalled a renewed improvement in the health of the sector. The upturn reflected resumed growth of new orders, production and employment.
India Meteorological Department said cumulative area weighted rainfall for the country as a whole till 30 August 2017 in the ongoing monsoon season was 3% lower than the normal rainfall. The June-September southwest monsoon is critical for the country's agriculture because a considerable part of the country's farmland is dependent on the rains for irrigation.
Overseas, Asian stocks gained after positive economic data in China. The financial markets looked to the US jobs report for August due later in the global day. China's manufacturing activity expanded at the fastest pace in six months in August, a private survey showed, buoyed by a surge in export orders and higher prices. The Caixin/Markit Manufacturing Purchasing Managers' Index (PMI) rose to 51.6 in August, compared with 51.1 in July.
US stocks advanced yesterday, 31 August 2017, with the main indexes posting their fifth consecutive monthly gain as investors responded to strong economic data and drew some cautious hope from the Donald Trump administration's latest promises for long-awaited details of a tax reform plan.
US consumer spending increased by less than estimated in July, though rising incomes and an upward revision to June purchases put the economy on a stable footing for the second half.
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