After alternately moving between positive and negative zone near the flat line, the two key benchmark indices extended gains in afternoon trade. At 13:15 IST, the barometer index, the S&P BSE Sensex, was up 79.12 points or 0.31% at 25,309.48. The gains for the Nifty 50 index were lower than those for the Sensex in percentage terms. The Nifty was currently up 15.75 points or 0.2% at 7,746.80. Gains in European stocks aided the upmove on the domestic bourses.
The Sensex rose 86.20 points, or 0.34% at the day's high of 25,316.56 in afternoon trade. The index fell 48.89 points, or 0.19% at the day's low of 25,181.47 in early trade, its lowest level since 6 May 2016. The Nifty rose 20.15 points, or 0.26% at the day's high of 7,751.20 in afternoon trade. The index shed 15.25 points, or 0.19% at the day's low of 7,715.80 in early trade, its lowest level since 6 May 2016.
The broad market depicted weakness. There were more than two losers against every gainer on BSE. 1,515 hares fell and 746 shares rose. A total of 159 shares were unchanged. The BSE Mid-Cap index was currently down 0.49%. The BSE Small-Cap index was currently down 0.71%. Both these indices underperformed the Sensex.
In overseas stock markets, European stocks reversed initial losses after the Federal Statistical Office in Germany said German economic growth accelerated at the start of the year helped by robust domestic demand. Confirming its earlier assessment of Europe's largest economy, Destatis said that Germany's gross domestic product grew at a quarterly rate of 0.7% in the first three months of the year, which translated into an annualized rate of 2.7%. Growth in the quarter was more than double the rate of 0.3% recorded in the fourth quarter of 2015. Asian stocks dropped as speculation mounted that the US Federal Reserve will raise interest rates as early as next month. Investors in emerging markets are worried that higher interest rates in the US will drain liquidity from emerging markets and redirect it to developed economies.
US stocks finished lower yesterday, 23 May 2016, as the prospect that interest rates might rise as soon as next month weighed on utilities shares. Philadelphia Fed President Patrick Harker said yesterday, 23 May 2016, that he could see two to three rate hikes in calendar year 2016 and that if the US economy shows sufficient strength, a June increase would be appropriate. St. Louis Fed President James Bullard said holding rates too low for too long could cause financial instability. San Francisco Fed President John Williams said on Sunday, 22 May 2016, that the presidential election in the US this year wouldn't prevent the central bank from raising interest rates and that a hike in interest rate in June remains likely.
The minutes from the US Federal Reserve's April policy meeting released last week showed that Fed policy setters discussed the possibility of a June rate increase if the economy continued to strengthen. The Federal Open Market Committee next undertakes monetary policy review on 14-15 June 2016. The US central bank had lifted rates in December 2015 for the first time in nearly a decade.
FMCG stocks fell. Britannia Industries (down 1.96%), GlaxoSmithkline Consumer Healthcare (down 1.18%), Colgate-Palmolive (India) (down 0.79%), Tata Global Beverages (down 0.33%), Procter & Gamble Hygiene and Health Care (down 0.4%), Jyothy Laboratories (down 2.36%), Bajaj Corp (down 0.36%) fell. Godrej Consumer Products (up 1.49%), Dabur India (up 0.56%), Hindustan Unilever (up 0.24%), Marico (up 0.04%), Nestle India (up 0.73%) rose.
Power generation stocks saw mixed trend. Reliance Infrastructure (down 1.68%), Torrent Power (down 0.84%), Reliance Power (down 1.98%), Jaiprakash Power Ventures (down 3.12%), Adani Power (down 0.18%), edged lower. NTPC (up 2.62%), CESC (up 0.45%), NHPC (up 1.15%), JSW Energy (up 1.12%) rose.
Tata Power Company (Tata Power) rose after the company announced strong Q4 results. The stock gained 1.49%. The company's consolidated net profit rose 126% to Rs 360 crore on 17% growth in revenue to Rs 9626 crore in Q4 March 2016 over Q4 March 2015. The result was announced after market hours yesterday, 23 May 2016. Tata Power said that the company aims to increase the share of non-fossil fuel based power generation output to 30-40% by 2025, up from its earlier target of 20%.
State-run coal-mining giant Coal India shed 0.21% at Rs 280. The stock hit a high of Rs 281 and a low of Rs 278 so far during the day.
Novartis India surged 12.25% after the company said that its board of directors will also consider a proposal for buyback of the company's equity shares along with the Q4 March 2016 result on 26 May 2016. The announcement was made after market hours yesterday, 23 May 2016.
HSIL tumbled 7.89% after net profit declined 4.3% to Rs 38.10 crore on 7.1% growth in net sales to Rs 579.44 crore in Q4 March 2016 over Q4 March 2015. The result was announced after market hours yesterday, 23 May 2016.
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