A rangebound movement was witnessed as key benchmark indices hovered in positive zone in mid-afternoon trade. At 14:17 IST, the barometer index, the S&P BSE Sensex was up 81.18 points or 0.29% at 28,105.51. The Nifty 50 index was currently up 23.25 points or 0.27% at 8,639.05. Market sentiment was positive after the US Federal Reserve has opted to keep interest rates at ultra-low level after the conclusion of a two-day monetary policy meeting. The ultra-loose monetary policy in the US has encouraged heavy investment in higher-yielding emerging markets.
The Sensex rose 127.66 points or 0.45% at the day's high of 28,151.99 in afternoon trade. The barometer index rose 40.57 points or 0.14% at the day's low of 28,064.90 at the onset of trading session. The Nifty rose 41 points or 0.47% at the day's high of 8,656.80 in afternoon trade. The index rose 10.55 points or 0.12% at the day's low of 8,626.35 at the onset of trading session.
The market breadth indicating the overall health of the market was positive. 1,469 shares rose and 1,056 shares declined. A total of 200 shares were unchanged. The BSE Mid-Cap index was currently up 0.66%. The BSE Small-Cap index was currently up 0.76%. Both these indices outperformed the Sensex.
In overseas stock markets, European and Asian stocks were mixed. In Japan, the Nikkei 225 Average ended 1.13% lower. Investors are hoping for further easing of monetary policy from the Bank of Japan (BOJ) after the conclusion of a two-day monetary policy meeting on 28-29 July 2016. Strength in the yen against the dollar post last month's Brexit vote and data showing a slowdown in the Japanese economy have triggered expectations of further easing of monetary policy from the BOJ. A stronger yen hurts the competitiveness of Japanese exporters.
US stocks closed mixed yesterday, 27 July 2016, after the Federal Reserve statement and major earnings reports. The Federal Open Market Committee (FOMC) has decided not to raise interest rates, maintaining the ultra-low level they have been at since December 2015. The US central bank opted to keep rates between 0.25% and 0.5%. The Fed said near-term risks to the economic outlook have diminished but inflation remained below the bank's target.
Power generation and distribution stocks gained. Power Grid Corporation of India (up 3.57%), JSW Energy (up 3.06%), Reliance Infrastructure (up 1.32%), CESC (up 1.17%), GMR Infrastructure (up 1.62%), Jaiprakash Power Ventures (up 0.48%), Reliance Power (up 0.18%), NHPC (up 0.2%), NTPC (up 0.09%), Tata Power (up 0.12%) and Torrent Power (up 0.12%) edged higher. Adani Power (down 0.18%) edged lower.
Auto stocks edged higher. Bajaj Auto (up 0.58%), TVS Motor Company (up 0.28%), Mahindra & Mahindra (up 0.36%) and Ashok Leyland (up 0.01%) gained. Tata Motors (down 1.41%) edged lower.
Eicher Motors was up 2.89% ahead of Q1 June 2016 results today, 28 July 2016.
Passenger car major Maruti Suzuki India (MSIL) edged higher after the company said that it plans to expand the number of NEXA outlets to 250 by March 2017. The stock was up 4.17%. NEXA is expected to contribute 15% of Maruti's sales by 2020, the company said. MSIL during market hours today, 28 July 2016 said that NEXA, the new automotive sales channel of the company has completed one year of operations. Launched in July 2015, NEXA has enabled MSIL to attract new categories of customers to its fold. NEXA has rapidly grown to 150 showrooms across 94 cities. Over 1 lakh cars have been sold through NEXA. This is about 10% of MSIL's total domestic sales, the company said. At present, the cars sold through NEXA are premium cross-over, S-Cross and premium hatchback, Baleno.
Hero MotoCorp (HMCL) was up 0.09%. The company during market hours today, 28 July 2016 announced that keeping with the core values of the Hero Group as established by the late Dr. Brijmohan Lall Munjal, the members of the BML Munjal family have decided to realign their businesses to achieve future growth and expansion. With the blessings of Santosh Munjal, the matriarch of the Munjal family, Sunil Kant Munjal, Joint Managing Director, HMCL and Chairman, Hero Corporate Service, intends to focus his time and energy on his independent and core businesses, and to pursue new business interests, HMCL said. He has, therefore, expressed his desire to step down from the Board of Directors of HMCL once his tenure as the Joint Managing Director of the company comes to an end on 16 August 2016, HMCL said. This realignment will not impact the overall promoter shareholding, strategic direction or operational management of the company, HMCL said. On this occasion, Pawan Munjal, Chairman, Managing Director & Chief Executive Officer, and the senior leadership team at HMCL reiterated their commitment to continue to build the company into a truly world class enterprise in all respects.
Meanwhile, according to reports, the government yesterday, 27 July 2016, cleared changes in the constitutional amendment bill on Goods and Services Tax (GST) including doing away with the additional 1% tax by producing states and compensating all states for any revenue loss in the first five years post the GST rollout. The Cabinet, headed by Prime Minister Narendra Modi, decided not to accede to the Congress party's demand of specifying the GST rate in the Constitution itself, reports suggested. It is likely to be part of the GST bill that will be legislated separately by both the Centre and states, as per reports.
The GST bill, which has been approved by the Lok Sabha is pending in the Rajya Sabha because of opposition to the bill in its current form by the Congress party. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax. The month-long monsoon session of the parliament will conclude on 12 August 2016.
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