Key benchmark indices extended gains and hit fresh intraday high in mid-afternoon trade as firmness in European stocks boosted sentiment. At 14:25 IST, the barometer index, the S&P BSE Sensex was up 74.96 points or 0.27% at 28,528.29. The Nifty 50 index was currently up 20.10 points or 0.23% at 8,806.30. The Sensex hit more than thirteen-month high. The Nifty hit more than sixteen-month high.
The Sensex rose 93.74 points or 0.32% at the day's high of 28,545.91 in mid-afternoon trade, its highest level since 23 July 2015. The barometer index slipped 37.77 points or 0.13% at the day's low of 28,414.40 in early afternoon trade. The Nifty rose 27.05 points or 0.3% at the day's high of 8,813.25 in mid-afternoon trade. The index shed 15.60 points or 0.17% at the day's low of 8,770.60 in early afternoon trade.
The market breadth indicating the overall health of the market was negative. On BSE, 1,423 shares fell and 1,177 shares rose. A total of 179 shares were unchanged. The BSE Mid-Cap index was currently up 0.02%. The BSE Small-Cap index was currently up 0.01%. Both these indices underperformed the Sensex.
In overseas stock markets, European stocks edged higher on rebound in crude oil prices after registering sharp losses during the previous trading session. Asian stocks were mixed as markets cautiously awaited the release of US jobs data scheduled tomorrow, 2 September 2016. China's official manufacturing purchasing managers' index, a gauge of factory activity, rose to 50.4 in August, returning to expansionary territory, official data showed today, 1 September 2016. The rise from July's 49.9 could be a sign of improvement in the world's second-largest economy. A PMI reading above 50 indicates an expansion in manufacturing activity, while a reading below 50 points to a contraction. However, the Caixin China manufacturing purchasing managers' index, a private gauge of nationwide factory activity, fell to 50 in August from 50.6 in July.
US stocks finished lower yesterday, 31 August 2016, as oil prices fell and promising economic data supported the case for a Federal Reserve rate hike this year. Data showed yesterday, 31 August 2016 the private sector created 177,000 jobs in August, in line with expectations, and contracts to buy previously owned homes surged in July, suggesting the economy was regaining sufficient momentum for the Federal Reserve to raise interest rates this year.
Most capital goods stocks dropped. Bharat Heavy Electricals (Bhel) (down 0.07%), L&T (down 0.29%), Thermax (down 0.39%), Crompton Greaves (down 1.26%) and Siemens (down 0.47%) declined. BEML (up 0.09%) and Havells India (up 1.71%) gained.
Shares of public sector banks were mixed. UCO Bank (down 0.61%), Syndicate Bank (down 0.45%), Allahabad Bank (down 0.06%), Union Bank of India (down 0.18%), and United Bank of India (down 1.13%) edged lower. Corporation Bank (up 0.12%), Bank of Baroda (up 0.46%), Bank of India (up 0.04%), State Bank of India (SBI) (up 0.61%), and Canara Bank (up 0.55%) gained.
Punjab National Bank declined 0.12% after the bank announced lending rates based on marginal cost of funds to be effective from today, 1 September 2016. The announcement was made after market hours yesterday, 31 August 2016. Marginal Cost of Funds based Lending Rate (MCLR) for overnight loans will be 9.1%, for one month will be 9.15% and for three months will be 9.25%. The MCLR on 6-month loans will be 9.3% and for one-year loans the rate would be 9.35%, the bank said. MCLR for three-year loans would be at 9.50% and loans with five-year maturity would carry an MCLR of 9.65%, the bank said.
Shares of private sector banks gained. Federal Bank (up 1.96%), Yes Bank (up 0.5%), IndusInd Bank (up 0.71%), ICICI Bank (up 2%), and Kotak Mahindra Bank (up 0.68%) gained. HDFC Bank declined 0.45%.
Ashok Leyland fell 2.57% after the company reported 6% fall in total sales to 10,897 units in August 2016 over August 2015. The company announced the monthly sales volume data during market hours today, 1 September 2016. Ashok Leyland reported 8% fall in sales of medium and heavy commercial vehicles (M&HCV) to 8,201 units in August 2016 over August 2015. Sales of light commercial vehicles (LCV) rose 2% to 2,696 units in August 2016 over August 2015.
Mahindra & Mahindra (M&M) rose 1.49% after the company reported good tractor sales in August. The company's total tractor sales rose 16% to 13,543 units in August 2016 over August 2015. Domestic sales rose 15% to 12,327 units in August 2016 over August 2015. Exports rose 28% to 1,216 units in August 2016 over August 2015.
Separately, the company announced the total auto sales rose 14% to 40,591 units in August 2016 over August 2015. Domestic sales rose 15% to 36,944 units in August 2016 over August 2015. Exports rose 4% to 3,647 units in August 2016 over August 2015. The announcements were made during market hours today, 1 September 2016.
HCL Technologies gained 0.37% after the company announced that it has entered into a partnership agreement with Mesosphere, a datacenter infrastructure and container orchestration company. The partnership combines Mesosphere's Datacenter Operating System (DC/OS) with HCL's unique Next-Gen IT & Operations capabilities to deliver a unified operational experience and achieve efficient resource utilization for clients. The announcement was made during market hours today, 1 September 2016.
On the macro front, the outcome of a monthly survey released today, 1 September 2016 showed that India's manufacturing sector showed a solid improvement last month. The seasonally adjusted Nikkei India Manufacturing Purchasing Managers' Index (PMI) showed a solid improvement in the health of the sector in August, climbing to a 13-month high of 52.6, from July's reading of 51.8. Indian manufacturers enjoyed a solid improvement in operating conditions during August. With demand from the domestic and external markets picking up, companies raised output accordingly. Firms recorded an easing in cost inflation during the month, which in turn resulted in a softer overall increase in factory gate charges.
Meanwhile, India's Gross Domestic Product (GDP) growth slowed down to 7.1% in Q1 June 2016, as against 7.9% in Q4 March 2016 and 7.5% increase in Q1 June 2015.
Another data showed that the index of eight core infrastructure sector rose 3.2% in July 2016 over July 2015. Cumulative eight core infrastructure sector growth stood at 4.9% in the four months period from April to July 2016. The eight core industries comprising coal, crude oil, natural gas, refinery products, fertilizers, steel, cement and electricity have a combined weight of 38% in the Index of Industrial Production (IIP). Both the GDP and core infra data were announced after market hours yesterday, 31 August 2016.
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