A range bound movement was witnessed as key benchmark indices hovered in positive zone in mid-morning trade. At 11:15 IST, the barometer index, the S&P BSE Sensex, was up 133.18 points or 0.52% at 25,570.15. The Nifty 50 index was currently up 45.55 points or 0.58% at 7,851.45. Data showing strong growth in core sector in March 2016 and overnight gains on Wall Street aided the upmove on the domestic bourses.
The broad market depicted strength. There were more than two gainers against every loser on BSE. 1,423 shares rose and 678 shares declined. A total of 130 shares were unchanged. The BSE Mid-Cap index rose 0.4%, underperforming the Sensex. The BSE Small-Cap index rose 0.89%, outperforming the Sensex.
In overseas stock markets, Asian stocks witnessed a mixed trend. Chinese stocks saw a divergent trend after the latest data showed deceleration in China's manufacturing activity in April 2016. In mainland China, the Shanghai Composite was currently up 1.7%. In Hong Kong, the Hang Seng index was currently down 0.92%. The Caixin China general manufacturing purchasing managers' index fell to 49.4 in April 2016 from 49.7 in March 2016. A reading below 50 indicates economic contraction. China's official manufacturing PMI, a competing gauge, came in at 50.1 in April 2016 compared with 50.2 in March 2016, according to data released by the National Bureau of Statistics on 1 May 2016. Meanwhile, Chinese leaders have called for strengthening the supervision of stock market and protecting investor interests, according to reports.
US stocks closed higher yesterday, 2 May 2016, after data showed slow-but-steady economic growth unfolding in the US. Latest data from the Institute for Supply Management showed manufacturing index in US fell to 50.8 last month from 51.8 in March. The reading, coming in above 50, indicates expansion in manufacturing activity, albeit at a slower-than-expected pace. Meanwhile, the San Francisco Federal Reserve President John Williams reiterated yesterday, 2 May 2016, his view that the US economy is ready for higher interest rates, but flagged the risk of broad-based declines in asset prices as a result.
Shares of public sector oil marketing companies (PSU OMCs) declined after the Petroleum Planning and Analysis Cell (PPAC) under the Ministry of Petroleum and Natural Gas said that the under-recoveries for the month of May 2016 on PDS Kerosene in Mumbai is expected to increase to Rs 9.12 per litre from Rs 8.73 per litre in April 2016. BPCL (down 0.88%) and HPCL (down 0.71%) edged lower.
Indian Oil Corporation (IOCL) was off 0.75% at Rs 422.95. The company after market hours yesterday, 2 May 2016, announced that in accordance with the approval accorded by Cabinet Committee on Economic Affairs (CCEA) on 13 May 2013, the Government of India (GOI) has offered 1.21 crore shares to the eligible employees of the company at a discounted price of Rs 367.65 per share. In connection with this, action has been initiated by the company for sale of equity shares to the eligible employees by the GOI, IOCL said. The offer for sale of share shall remain open from 2 May 2016 to 10 May 2016, IOCL said. GOI is the principal shareholders of IOCL. It holds 58.57% stake in IOCL.
Shares of oil exploration and production (E&P) firms rose. Oil India (up 0.75%) and ONGC (up 0.32%) edged higher. Cairn India (down 0.8%) edged lower.
Index heavyweight Reliance Industries (RIL) was up 0.12% at Rs 987.50. The stock hit a high of Rs 994.70 and a low of Rs 985.45 so far during the day.
In the global commodities markets, Brent for July settlement was currently up 39 cents at $46.22 a barrel. The contract had declined $1.54 a barrel or 3.25% to settle at $45.83 a barrel during the previous trading session on profit-taking after last month's rally.
FMCG stocks witnessed a mixed trend. Bajaj Corp (up 1.47%), Godrej Consumer Products (up 0.13%), Emami (up 0.89%), Britannia Industries (up 0.9%), Tata Global Beverages (up 0.33%), Procter & Gamble Hygiene and Health Care (up 0.21%) and Colgate-Palmolive (India) (up 0.23%) edged higher. Dabur India (down 2.18%), Marico (down 1.78%), Nestle India (down 0.42%), Hindustan Unilever (down 0.55%), Jyothy Laboratories (down 0.23%) and GlaxoSmithkline Consumer Healthcare (down 0.02%) edged lower.
Index heavyweight and housing finance major HDFC rose 1.74% to Rs 1,111.75, with the stock extending post-result gains. The stock had risen 0.36% to settle at Rs 1,092.75 yesterday, 2 May 2016, after the company announced Q4 March 2016 results during market hours on that day. 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.
Tata Power Company rose 4.21% at Rs 73.10 after the company said that its strategic engineering division, Tata Power SED, received an order from the Border Security Force (BSF), Ministry of Home Affairs, Government of India for the supply of Rajak TBC DN-1, its indigenously developed hand held thermal imaging systems (HHTI) (cooled version). Tata Power SED's Rajak TBC DN-1 is an advanced hand held thermal imager meant for long range day/night surveillance application. The announcement was made after market hours yesterday, 2 May 2016.
On the macro front, data released by the government after market hours yesterday, 2 May 2016, showed that the core sector registered a strong growth of 6.4% in March 2016 over March 2015. The eight core industries comprising of coal, crude oil, natural gas, refinery products, fertilizers, steel, cement and electricity have nearly 38% weightage in the index of industrial production (IIP). The core sector registered a growth of 2.7% in the year ended 31 March 2016 over the year ended 31 March 2015.
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