Key benchmark indices were trading with tiny gains in early afternoon trade. At 12:20 IST, the barometer index, the S&P BSE Sensex was up 6.70 points or 0.02% at 31,216.49. The Nifty 50 index was up 12.05 points or 0.13% at 9,625.35. A private survey showing service sector expanding at its fastest pace in eight months in June and gains in most Asian stocks provided support to local indices.
The movement of indices was restricted within a narrow range near the flat line so far during the session.
The S&P BSE Mid-Cap index rose 0.63%. The S&P BSE Small-Cap index gained 0.79%. Both these indices outperformed the Sensex.
The breadth, indicating strength of the market was strong. On BSE, 1,509 shares rose and 878 shares fell. A total of 122 shares were unchanged.
Most auto stocks gained after many companies slashed prices of the vehicles post GST took effect from 1 July 2017. Ashok Leyland (up 1.51%), Eicher Motors (up 0.43%), and Hero MotoCorp (up 0.31%) gained. Maruti Suzuki India (down 0.22%), TVS Motor Company (down 0.2%) and Bajaj Auto (down 0.05%) declined.
Tata Motors rose 1.05% after the company said that it has slashed prices of passenger vehicles post GST, passing benefits of GST to its customers. The announcement was made during market hours today, 5 July 2017. The company offered a price reduction of upto 12% ranging between Rs 3,300 and Rs 2.17 lakh depending on the model and variant.
Mahindra & Mahindra (M&M) rose 2.17% after the company announced revised prices of its vehicles pursuant to the implementation of Goods & Services Tax (GST), with immediate effect. The announcement was made after market hours yesterday, 4 July 2017.
The prices of vehicles for end-customers on large utility vehicles (UVs) and sports utility vehicles (SUVs) have been reduced by an average of 6.9%, while those that come under small car segment have been reduced by an average of 1.4%. Similarly, end-customer prices have been reduced by an average of 1.1% for small commercial vehicles and 0.5% for light commercial vehicles (LCVs) and heavy commercial vehicles (HCVs).
Since the GST rates on hybrid vehicles are significantly higher than that in the pre-GST regime, the prices for the end-customers of hybrid vehicles have been increased marginally. These price changes to end-customers will vary across states or even cities within a state, due to the differing levels of pre-GST local taxes.
The effect of the imposition of GST for tractors, which were not levied an excise duty, should be neutral given the input tax credits that would be available to original equipment manufacturers (OEMs). Hence there will be no change for end-customer prices for tractors.
Capital goods stocks gained. Bharat Heavy Electricals (Bhel) (up 0.34%), Havells India (up 1.1%), Bharat Electronics (up 0.24%), L&T (up 0.6%), Thermax (up 0.2%), and BEML (up 2.2%) gained. ABB India declined 0.51%.
Jubilant Life Sciences rose 3.12% to Rs 713.15 after a domestic brokerage reportedly initiated coverage on the stock with a buy rating and a target price of Rs 905. The domestic brokerage reportedly expects strong growth in pharma and life science ingredients segments going ahead.
Cadila Healthcare rose 0.53% after the company announced the initiation of a phase Il trial investigating ZYAN1, an oral hypoxia-inducible factor prolyl hydroxylase inhibitor (HIF-PHI), as a treatment for anemia associated with chronic kidney disease (CKD). The announcement was made during trading hours today, 5 July 2017.
Lupin gained 0.21% after the company announced the launch of generic Vigamox Ophthalmic solution in the US. The company launched Moxifloxacin Hydrochloride Opthalmic Solution USP, 0.5% (base) having received an approval from the United States Food & Drug Administration (USFDA). The announcement was made during market hours today, 5 July 2017.
The medicine is indicated for the treatment of bacterial conjunctivitis caused by susceptible strains of the organisms. Vigamox Ophthalmic solution had US sales of $267.9 million in US as per IMS MAT March 2017.
Bhansali Engineering Polymers gained 4.14% after the company scheduled a board meeting on 14 July 2017 to consider expansion project of company for increasing ABS production capacity from existing 80 kilo tonnes per annum (KTPA) to 137 KTPA inter alia other businesses. The announcement was made after market hours yesterday, 4 July 2017.
On macroeconomic data front, activity in India's dominant service sector expanded at its fastest pace in eight months in June as new business orders surged, a private survey showed. The Nikkei/IHS Markit Services Purchasing Managers' Index climbed to 53.1 in June from the previous month's 52.2. June was the fifth consecutive month the index has been above the 50 mark that separates growth from contraction.
Overseas, most Asian stocks rose amid geopolitical concerns after North Korea launched a long-range ballistic missile. North Korea reportedly claimed today, 5 July 2017 the missile it launched yesterday, 4 July 2017 was an intercontinental ballistic missile capable of carrying a heavy nuclear warhead. The missile launched on Tuesday, 4 July 2017 landed in Japan's exclusive economic zone (EEZ).
On macroeconomic data front, the Caixin services Purchasing Managers' Index (PMI) showed that growth in China's services sector slowed in June. The Caixin services PMI fell to 51.6 from the 52.8 figure seen in May. The June composite PMI, which takes into account both the services and manufacturing sectors, fell to 51.1 compared with the 51.5 number seen last month.
Activity in Japan's services sector accelerated from the previous month to expand at its fastest pace in almost two years, a private survey showed. The Markit/Nikkei Japan Services Purchasing Managers Index (PMI) rose to a seasonally adjusted 53.3 in June from 53 in May as new business, outstanding business and hiring expanded.
US markets were closed yesterday, 4 July 2017 for Independence Day.
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