Key benchmark indices extended intraday gains in mid-afternoon trade after the Lok Sabha passed Finance Bill 2016. At 14:15 IST, the barometer index, the S&P BSE Sensex, was up 285.69 points or 1.14% at 25,387.42. The gains for the Nifty 50 index were lower than the Sensex's gains in percentage terms. The Nifty was currently up 60.80 points or 0.79% at 7,767.35.
The Sensex rose 292.37 points or 1.16% at the day's high of 25,394.10 in mid-afternoon trade, its highest level since 3 May 2016. The barometer index rose 61.21 points or 0.24% at the day's low of 25,162.94 in morning trade. The Nifty rose 71 points or 0.92% at the day's high of 7,777.55 in mid-afternoon trade, its highest level since 3 May 2016. The index rose 0.30 points at the day's low of 7,706.85 in afternoon trade.
The market breadth indicating the overall health of the market once again turned positive from negative in mid-afternoon trade. On BSE, 1,221 shares rose and 1,192 shares declined. A total of 136 shares were unchanged. The BSE Mid-Cap index was currently up 0.34%. The BSE Small-Cap index was currently up 0.36%. Both these indices underperformed the Sensex.
The Lok Sabha passed the Finance Bill 2016 today, 5 May 2016, after Finance Minister Arun Jaitley moved 55 amendments to the Bill. The government provided a thrust on the infrastructure, agriculture and rural sectors in the Union Budget 2016-17.
In overseas stock markets, European stock markets edged higher, buoyed by some solid corporate earnings at the likes of BT. Asian stocks edged lower on data showing slowdown in growth in China's services sector last month. However, the data triggered speculation of likely stimulus for the Chinese economy, thereby aiding recovery in mainland China. The Shanghai Composite index ended 0.22% higher. In Hong Kong, the Hang Seng index ended 0.37% lower. The China Caixin services purchasing managers' index (PMI) dropped to 51.8 in April from 52.2 in March. China's official non-manufacturing PMI, a competing gauge, fell to 53.5 in April from 53.8 in March, according to data released on 1 May 2016. China's economy is the world's second biggest economy.
US stocks edged lower yesterday, 4 May 2016, after weaker-than-expected private-sector job data. The ADP employment data showed that private payrolls across the US rose by 156,000 last month. The increase is the smallest since April 2013. The report is seen as a precursor to the top-tier nonfarm-payrolls data due on Friday, 6 May 2016. The nonfarm-payrolls data has implications for the US monetary policy. The US central bank's mandate centers on maximizing employment and keeping inflation at a 2% target level. The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 14-15 June 2016.
Stocks of public sector banks were mostly higher. Among public sector banks, Syndicate Bank (up 0.08%), Bank of Baroda (up 0.2%), State Bank of India (up 0.42%), Canara Bank (up 1.14%), Punjab National Bank (up 0.49%) and Corporation Bank (up 1.5%) edged higher. Indian Bank (down 1.69%), IDBI Bank (down 1.05%) and Union Bank of India (down 0.51%) edged lower.
Stocks of private sector banks declined. IndusInd Bank (down 0.94%), Kotak Mahindra Bank (down 0.49%) and HDFC Bank (down 0.31%) edged lower. Axis Bank (up 0.14%) and ICICI Bank (up 1.54%) edged higher.
Yes Bank was down 0.12%. The stock was volatile. The stock hit a high of Rs 933 and a low of Rs 906.65 so far during the day. The private sector bank today, 5 May 2016, announced that it has received in-principle approval by Securities and Exchange Board of India (Sebi) for acting as custodian of securities. Yes Bank shall now invest in developing operations, technology and human capital capabilities and seek registration with Sebi as a custodian of securities, the bank said. As per the in-principle approval, Yes Bank shall establish this business within 12 months of this approval.
Metal and mining stocks edged lower after data showing slowdown in growth in China's services sector last month. National Aluminium Company (down 2.63%), Hindalco Industries (down 2.08%), Vedanta (down 1.77%), Steel Authority of India (down 0.95%), Tata Steel (down 0.44%) and JSW Steel (down 0.34%) declined. Hindustan Zinc (up 0.91%), Hindustan Copper (up 0.19%) and NMDC (up 0.37%) edged higher. China is the world's largest consumer of steel, copper and aluminum.
Copper edged lower in the global commodities markets. High Grade Copper for July 2016 delivery was currently down 0.73% at $2.1705 per pound on the COMEX.
Jindal Steel & Power (JSPL) lost 1.58% at Rs 65.55 after the announcement of its fourth quarter earnings. The company reported consolidated net loss of Rs 363 crore in Q4 March 2016, lower than net loss of Rs 581 crore in Q4 March 2015. Turnover rose 7% to Rs 4874 crore in Q4 March 2016 over Q4 March 2015. Earnings before interest, taxation, depreciation and amortization (EBITDA) rose 9% to Rs 896 crore in Q4 March 2016 over Q4 March 2015. EBITDA margin was reported at 18% in Q4 March 2016, same as in in Q4 March 2015. The result was announced after market hours yesterday, 4 May 2016.
In its outlook, JSPL said that its endeavor for the year ending 31 March 2017 (FY 2017) would be to fully utilize its consolidated capacities of 6.75 MTPA in steel. With Steel prices looking up in recent times on the back of rise in global steel prices and government support through minimum import price (MIP), the company is looking to improve its net sales realization (NSR) substantially during the year and generate higher EBITDA. Ramp up of Oman rebar mill and commissioning of Angul rebar mill should further help increase these realizations.
In power business, the company expects the demand to pick up, both in short term & long term markets. With the summer setting in, the demand and the exchange prices should move higher, helping the company generate higher revenues. Also, the company believes the UDAY scheme by the Government of India is a commendable scheme, which could catalyze the PPA markets in the coming year.
Supported by government's novel initiatives like Make-in-India campaign, 24X7 power, housing for all, dedicated freight corridors, smart city initiative, JSPL envisages the demand for steel and power to increase in near future and help JSPL sweat its assets to generate additional revenues and higher operating profits in FY 2017 and beyond, the company added.
Hexaware Technologies dropped 2.39% at Rs 222.80 after consolidated net profit fell 15.3% to Rs 84.20 crore on 0.1% rise in revenue to Rs 820.20 crore in Q1 March 2016 over Q4 December 2015. Earnings before interest, taxation, depreciation and amortization (EBITDA) excluding ESOP cost fell 3.3% to Rs 126.70 crore in Q1 March 2016 over Q4 December 2015. The result was announced after market hours yesterday, 4 May 2016.
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