Key benchmark indices cut losses in mid-afternoon trade after extending losses to hit fresh intraday low. At 14:20 IST, the barometer index, the S&P BSE Sensex, was down 26.75 points or 0.1% to 27,500.47. The Nifty 50 index was currently down 6.50 points or 0.08% at 8,507.50. The Sensex hit its lowest level in over 16 weeks while the Nifty hit its lowest level in over 15 weeks. Trading for the day remained confined in a small range as investors remained cautious ahead of the US presidential election next week.
The Sensex rose 73.52 points or 0.27% at the day's high of 27,600.74 in mid-morning trade. The barometer index fell 88.65 points or 0.32% at the day's low of 27,438.57 in mid-afternoon trade, its lowest level since 11 July 2016. The Nifty rose 23.65 points or 0.28% at the day's high of 8,537.65 in mid-morning trade. The index fell 27.10 points or 0.32% at the day's low of 8,486.90 in mid-afternoon trade, its lowest level since 19 July 2016.
The market breadth indicating the overall health of the market turned negative from positive in mid-afternoon trade. On BSE, 1,496 shares declined and 1,338 shares rose. A total of 131 shares were unchanged. The BSE Mid-Cap index was currently down 0.77%. The BSE Small-Cap index was currently down 0.5%. The decline in both the indices was higher than the Sensex's decline in percentage terms.
Most pharma stocks fell. Glenmark Pharmaceuticals (down 1.89%), Lupin (down 1.04%), Sun Pharmaceutical Industries (down 0.57%), GlaxoSmithKline Pharmaceuticals (down 0.09%), Aurobindo Pharma (down 1.58%) and Wockhardt (down 0.84%) edged lower. Alkem Laboratories (up 0.13%), Cadila Healthcare (up 0.04%), Cipla (up 0.36%), Dr Reddy's Laboratories (up 0.23%) rose.
Strides Shasun surged 7.17% after the company said that Mylan agreed to settle regulatory and general claims on Agila transaction. The announcement was made before trading hours today, 3 November 2016.
Strides Shasun and its wholly-owned subsidiary, Strides Pharma Asia, completed the sale to Mylan Laboratories and Mylan Institutional Inc. of Agila Specialties and Agila Specialties Global respectively, pursuant to sale and purchase agreements (SPAs) effective as of 27 February 2013 on 4 December 2013. At the time of closing on 5 December 2013, two escrows of $100 million each were provided i.e., $I00 million in respect of potential claims under the SPAS in relation to certain regulatory concerns and $100 million in respect of potential claims that may be brought in relation to the warranties and indemnities, including in relation to tax, agreed pursuant to the SPAs and other transaction documents. Later, Strides Shasun and its subsidiary received notification of claims from Mylan in accordance with the SPAs and other transaction documents. The claims notified by Mylan related to certain regulatory concerns and certain of the warranties and indemnities, including in relation to tax. However, Strides and Mylan have now agreed on a full and final settlement of all regulatory claims notified by Mylan to the company and the subsidiary. Pursuant to the settlement, Mylan's regulatory concerns claims will be satisfied from the regulatory escrow, and Strides Shasun will receive approximately $30 million, representing the balance of funds it deposited in the regulatory escrow on consummation of the Agila sale pursuant to the SPAs. In addition, Strides and Mylan have now agreed on a full and final settlement of the warranty and indemnity claims. The general claims escrow continues to be valid till December 2017 and pertains to tax and certain potential third party claims.
Shree Pushkar Chemicals & Fertilisers rose 10.65% after the firm announced commercial production of its sulphate of potash plant. Shree Pushkar Chemicals & Fertilisers had in August 2016 announced trial runs of its sulphate of potash (SOP) plant, a soluble potassic fertiliser with a capacity of 10,000 metric tonnes per annum (MTA). The commercial production of this plant commenced in end September 2016. Simultaneouly along with the commercial production of the SOP plant it has also commenced trial runs of the granular calcium chloride plant of the capacity of 6,500 MTA, a byproduct in the manufacture of SOP. The commercial production of this plant is slated to commence by end November 2016. The announcement was made after market hours yesterday, 2 November 2016.
Premier Explosives gained 4.21% after net profit rose 27% to Rs 2.40 crore on 35.8% rise in net sales to Rs 54.70 crore in Q2 September 2016 over Q2 September 2015. The result was announced after market hours yesterday, 2 November 2016.
Indo Amines was locked in 20% upper circuit at Rs 80.45 after the company said it received approval from United States Environmental Protection Agency to sell 10 products in the US market. In a disclosure to the exchanges, the company listed the 10 chemical products for which it bagged approvals. The announcement was made after market hours yesterday, 2 November 2016.
On the macro front, the Nikkei India Services Purchasing Managers' Index, or PMI, rose to 54.5 in October from 52 in September. A reading above 50 indicates economic expansion, while a reading below 50 points toward contraction. The service sector joined its manufacturing counterpart in offering a more upbeat level of performance this month, providing reassurance in the sustainability of the upturn of India's economy, Pollyanna De Lima, economist at IHS Markit said. She added that one underlying concern is the sustained stagnant trend in workforces, with both manufacturers and service providers showing some reluctance to hire.
Meanwhile, international rating agency Standard & Poor's (S&P) yesterday, 2 November 2016 affirmed "BBB-/A-3" rating with stable outlook for India. The stable outlook balances India's sound external position and inclusive policy making tradition against the vulnerabilities stemming from its low per capita income and weak public finances, S&P said. The ratings on India reflect the country's sound external profile and improved monetary credibility, the agency said. The outlook indicates that rating agency does not expect to change its rating on India this year or next, based on its current set of forecasts, it said. Improvements in policy making continue to strengthen the prospects for India's economic and fiscal performance. Wide fiscal deficits, a heavy debt burden, and low per capita income nonetheless detract from the sovereign's credit profile, it added.
In overseas stock markets, European stocks were steady to higher, as investors eyed the Bank of England's policy statement due later in the trading session and as they remained cautious ahead of the US presidential election next week. Most Asian stocks dropped with uncertainty over next week's US presidential election sending investors rushing for the sidelines. China's Shanghai Composite ended 0.84% higher. Activity in China's service sector expanded at a faster pace in October, a private gauge showed today, 3 November 2016, adding to recent signs of firmness in China's economy. The Caixin China services purchasing managers' index rose to a four-month high of 52.4 in October from 52 in September, Caixin Media Co. and research firm Markit said.
US stocks fell yesterday, 2 November 2016, with the S&P 500 recording its longest losing streak in five years after the Federal Reserve, as expected, kept interest rates unchanged. The Federal Reserve yesterday, 2 November 2016 signaled that the time for another interest-rate hike is approaching and it doesn't need much more evidence before moving. The Fed policy committee committee voted 8 to 2 to maintain interest rates in a range of 0.25 to 0.5%. The Fed said inflation has been moving up toward its 2% target since the beginning of the year. Meanwhile, polls showed a tightening presidential race. A latest poll reportedly showed Republican nominee Donald Trump taking a one-point lead over rival Hillary Clinton. Investors generally view Clinton as a known quantity, but there is deep uncertainty about what a Trump win might mean for US economic policy, free trade and geopolitics.
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