Gains in index heavyweight ITC and oil and pharma sector stocks aided modest gains for key benchmark indices. The barometer index, the S&P BSE Sensex, rose 147.33 points or 0.55% at 26,932.88. The gains for the Sensex were higher in percentage terms than those for the 50-unit CNX Nifty index. The Nifty rose 33.60 points or 0.41% at 8,152.90. The Sensex failed to retain the psychological 27,000 mark after surpassing that mark in intraday trade. The Sensex and the Nifty, both, attained 6-1/2-week closing high. The two key benchmark indices edged higher for the fifth day in a row.
Shares of frontline banks witnessed a mixed trend. Cement and IT stocks dropped whereas metal and mining stocks rose. Shares of index heavyweight and cigarette maker ITC surged on media reports that the company has decided to foray into the dairy segment with the launch of its new product Aashirvaad ghee this Diwali.
Benchmark indices witnessed intraday volatility. The Sensex rose 147.33 points or 0.55% to settle at 26,932.88, its highest closing level since 21 August 2015. The Sensex jumped 224.72 points or 0.83% at day's high of 27,010.27. The barometer index lost 34.30 points or 0.12% at the day's low of 26,751.25.
The 50-unit CNX Nifty rose 33.60 points or 0.41% to settle at 8,152.90, its highest closing level since 21 August 2015. The Nifty jumped 61.65 points or 0.75% at day's high of 8,180.95. The index lost 22.80 points or 0.28% at the day's low of 8,096.50.
The market breadth indicating the overall health of the market was positive. On BSE, 1,589 shares rose and 1,151 shares declined. A total of 114 shares were unchanged. The BSE Mid-Cap index rose 0.31%, underperforming the Sensex. The BSE Small-Cap index rose 0.69%, outperforming the Sensex.
The total turnover on BSE amounted to Rs 2883 crore, lower than turnover of Rs 3038.42 crore registered during the previous trading session.
Among the sectoral indices on BSE, the S&P BSE Consumer Durables index (up 4.30%), the S&P BSE FMCG index (up 2.41%), the S&P BSE Metal index (up 2.14%), the S&P BSE Oil & Gas index (up 1.92%), the S&P BSE Healthcare index (up 0.92%), the S&P BSE Realty index (up 0.87%) and the S&P BSE Auto index (up 0.61%) outperformed the Sensex. The S&P BSE Capital Goods index (up 0.01%), the S&P BSE Power index (up 0.01%), the S&P BSE Bankex (down 0.23%), the S&P BSE Teck (down 0.82%) and the S&P BSE IT index (down 1.18%) underperformed the Sensex.
FMCG stocks gained. Hindustan Unilever (HUL) (up 2.21%), Britannia Industries (up 1.6%), Jyothy Laboratories (up 2.05%), Nestle India (up 0.13%), Dabur India (up 0.27%), GlaxoSmithkline Consumer Healthcare (up 0.5%), Godrej Consumer Products (up 1.25%), and Bajaj Corp (up 0.91%) gained. Tata Global Beverages (down 0.34%), Procter & Gamble Hygiene and Health Care (down 0.93%), Marico (down 0.12%), and Colgate Palmolive India (down 0.61%) declined.
Index heavyweight and cigarette maker ITC rose 4.24% on media reports that the company has decided to foray into the dairy segment with the launch of its new product Aashirvaad ghee this Diwali. Aashirvaad is a brand of staple food and kitchen ingredients owned by ITC and the range of products include atta, salt, spices and instant mixes.
Oil exploration firms gained along with rise in crude oil prices. ONGC (up 2.85%), Cairn India (up 2.39%), Reliance Industries (RIL) (up 1.09%) and Oil India (up 1.13%) gained. Higher crude oil prices would result in higher realizations from crude sales for oil exploration firms.
In the global commodities markets, Brent for November settlement was currently up 8 cents at $49.33 a barrel. The contract had risen $1.12 a barrel or 2.32% to settle at $49.25 a barrel during the previous trading session.
Shares of public sector oil marketing companies also rose. BPCL (up 1.89%), Indian Oil Corporation (up 0.39%) and HPCL (up 2.9%) edged higher.
Pharma stocks gained. Cipla (up 3.44%), Dr Reddy's Laboratories (up 1.33%), GlaxoSmithKline Pharmaceuticals (up 1.6%), Glenmark Pharmaceuticals (up 0.91%) and Cadila Healthcare (up 2.17%) gained. Lupin slipped 0.27%.
Sun Pharmaceutical Industries rose 1.26% after the company announced that its wholly-owned subsidiary - Ranbaxy Pharmaceuticals Inc. (Ranbaxy), along with its partners, Cipher Pharmaceuticals Inc. (Cipher) and Galephar Pharmaceutical Research, Inc. (Galephar) have entered into a settlement agreement with Actavis Group (Actavis) that dismisses the patent litigation suit relating to Actavis' abbreviated new drug application (ANDA) for a generic version of Absorica (isotretinoin capsules). The company made the announcement after market hours yesterday, 5 October 2015. As part of the settlement agreement, Ranbaxy, Cipher, and Galephar have entered into a non-exclusive license agreement with Actavis under which Actavis may begin selling its generic version of Absorica in the US on 27 December 2020 (about nine months prior to the expiration of the patents in September 2021) or earlier under certain circumstances. The settlement agreement is subject to review by the US Federal Trade Commission and the US Department of Justice.
Wockhardt rose 2.78% after the company announced that inspection of its manufacturing unit at L-1, Chikalthana, Aurangabad in Maharashtra by UK Medicines and Healthcare products Regulatory Agency (MHRA) has been completed and there were no critical observations. The announcement was made after market hours yesterday, 5 October 2015.
Bank stocks were mixed. Among private bank stocks, Axis Bank (down 1.02%), IndusInd Bank (down 0.83%), HDFC Bank (down 0.83%) and Yes Bank (down 0.88%) declined. Kotak Mahindra Bank (up 0.74%) and ICICI Bank (up 0.91%) rose.
Among PSU bank stocks, Bank of Baroda (down 1.37%), State Bank of India (SBI) (down 0.04%) and Union Bank of India (up 1.07%) dropped. Punjab National Bank (up 0.7%), IDBI Bank (up 0.62%) and Bank of India (up 1.76%) rose.
Canara Bank rose 1.9% after the bank said its board of directors approved reduction in the bank's base rate by 25 basis points to 9.65% from 9.9% with effect from 7 October 2015. The announcement was made after market hours yesterday, 5 October 2015.
Indian Overseas Bank fell 0.27% after the Reserve Bank of India (RBI) initiated a prompt corrective action on the bank to improve internal controls and consolidate its business activities. The RBI's action will not have any material impact on the growth prospects/performance of the bank. The announcement was made after market hours yesterday, 5 October 2015.
Housing finance major HDFC rose 0.18% to Rs 1,258.20. The stock hit high of Rs 1,268.10 and low of Rs 1,238.85. The company announced a reduction in its retail prime lending rate (RPLR) by 25 basis points with effect from 6 October 2015. The effective home loan rates for new customers would be 9.65% per annum (p.a.) and for women it will be 5 basis points lower at 9.6% p.a. HDFC recently made similar reduction in its deposit rates across all maturities.
Metal and mining stocks edged higher on renewed buying. Bhushan Steel (up 0.45%), Hindustan Copper (up 5.59%), Vedanta (up 1.24%), Hindalco Industries (up 0.88%), Hindustan Zinc (up 0.49%), Steel Authority of India (Sail) (up 1.44%), Tata Steel (up 0.85%), Jindal Steel & Power (up 6.21%), and National Aluminum Company (up 1.28%) gained. JSW Steel (down 1.1%) and NMDC (down 0.42%) declined.
Shares of Coal India gained 3.95% on reports that a foreign brokerage has upgraded the stock to outperform from neutral. The foreign brokerage has reportedly said in a research note that a financial restructuring plan for power distribution companies operated by various state-government run entities may remove a big overhang on the shares of Coal India and NTPC. The finance ministry has said that it is preparing a financial restructuring plan for power distribution companies operated by various state-government run entities. Shares of NTPC dropped 1.3% to settle at Rs 125.75.
Tata Power Company rose 2.68%. Tata Power Strategic Engineering Division (Tata Power SED) and Secusmart, the global expert in secure mobile communications, announced a comprehensive partnership for the Indian market. The announcement was made during market hours today, 6 October 2015. The two companies have signed a term sheet (MoU) providing a framework for the collaboration, the aim of which is to evaluate the design, development and marketing of a highly secure mobile communications system tailored to the needs of government customers in India.
The proposed collaboration is aimed at leveraging Tata Power SED's expertise in security, software and hardware design and manufacturing and Secusmart's expertise in software and security to provide a highly capable and secure communication solution meeting stringent government requires, Tata Power said in a statement. Secusmart GmbH, a subsidiary of BlackBerry, is a leading expert in the development and implementation of comprehensive solutions for protecting businesses and public authorities from electronic eavesdropping.
Tata Motors jumped 5.74%, with the stock extending a rally registered during the previous trading session. Jaguar Land Rover North America announced on 1 October 2015 that its US sales rose 61% to 6,850 units in September 2015 over September 2014.
Telecom stocks were in demand on renewed buying. Idea Cellular (up 3.09%), MTNL (up 2.15%), Tata Teleservices (Maharashtra) (up 1.74%) and Bharti Airtel (up 0.48%) gained. Reliance Communications shed 0.35%.
IT stocks declined. HCL Technologies (down 1.15%), TCS (down 1.23%) Wipro (down 0.02%) and MphasiS (down 0.82%) edged lower. Oracle Financial Services Software rose 0.65%.
Infosys fell 1.99% to Rs 1,157 on profit booking after the stock jumped 6.52% in the preceding four trading sessions to Rs 1,180.50 yesterday, 5 October 2015, from a recent low of Rs 1,108.20 on 28 September 2015. The company is scheduled to announce its Q2 September 2015 results on 12 October 2015.
Tech Mahindra fell 1.3%. Tech Mahindra announced bagging a contract to provide digital solutions to Bombardier. As per the agreement with Bombardier Commercial Aircraft, Tech Mahindra will develop aircraft ground support system (AGSS) for Bombardier's Aircraft Health Management System (AHMS) for the C Series family of aircraft. The AGSS will facilitate real-time and post-flight recorded data management, fault notification and diagnostic reporting, Tech Mahindra and Bombardier said in a joint press release issued after trading hours in India yesterday, 5 October 2015.
Sugar stocks rallied on renewed buying. Bajaj Hindusthan (up 13.09%), Dhampur Sugar Mills (up 16.05%), Sakthi Sugars (up 19.74%), Balrampur Chini Mills (up 8.98%), Triveni Engineering & Industries (up 12.83%), Shree Renuka Sugars (up 12.65%), Simbhaoli Sugar Mills (up 10.33%) and Dwarikesh Sugar Industries (up 14.95%) gained.
Prabhat Dairy rose 3.5% to Rs 121.20 after Reliance Mutual Fund bought 2.13% stake in the company through bulk deals on BSE and NSE yesterday, 5 October 2015. On Monday, 5 October 2015, Reliance Mutual Fund bought 9.37 lakh shares of Prabhat Dairy at Rs 117 on the NSE and bought 11.50 lakh shares at Rs 117 on the BSE.
Gujarat NRE Coke was locked at 20% upper circuit at Rs 3.76 after the company said that its board of directors yesterday, 5 October 2015 approved the sale of the company's wind mill business for a consideration of Rs 218.75 crore. The company made the announcement after market hours yesterday, 5 October 2015.
Meanwhile, the finance ministry yesterday, 5 October 2015, announced that the central government's expenditure on major subsidies has come down to 1.6% of GDP in 2015-16 from 2.5% of GDP in 2012-13. There could be a shortfall of around 5% to the estimated target of tax collection of Rs 14.5 lakh crore for the current fiscal year. The government is committed to achieving this year's fiscal deficit target as well as the fiscal glide path laid out in the Union Budget 2015-16, the finance ministry said. The central government's infrastructure spending has picked-up on the back of accelerated spending on highways, railways and the power sector. The central government's Plan Cap-EX has increased by over 30% this year. This is beginning to crowd-in private investment. The public private partnership projects which had been stalled are also now picking up.
With regard to inflation, the finance ministry said that the government's proactive food management to augment domestic supplies will ensure that food inflation is contained in the wake of scanty rains. The government and the Reserve Bank of India (RBI) will work together to consolidate the gains achieved on inflation control through the inflation targeting framework and the associated institutional arrangements. The finance ministry further said that the government will play its part to ensure that the benefits of falling interest rates are transmitted to the economy at large. A number of commercial banks have announced a reduction in their base rate during the past few days in the wake of a steeper-than-expected 50 basis points cut in the repo rate announced by the RBI after a regular monetary policy review early last week.
The finance ministry issued the statement after a press conference held by various secretaries to the Ministry of Finance and Chief Economic Adviser (CEA) Dr Arvind Subramanian on the completion of six months of financial year 2015-16 on 30 September 2015.
Meanwhile, the outcome of a monthly survey from Markit Economics showed that the growth in India's services sector activity eased last month. The Nikkei India Business Activity index dropped to 51.3 in September 2015 from 51.8 in August 2015. The slowdown in growth in the services sector comes close on the heels of another data showing slowdown in growth momentum in the manufacturing sector in September 2015.
Key benchmark indices edged higher for the fifth consecutive session. The Sensex has garnered 1,316.04 points or 5.13% in the preceding five trading sessions from its close of 25,616.84 on 28 September 2015. The Sensex has risen 778.05 points or 2.97% in this month so far (till 6 October 2015). The Sensex has fallen 566.54 points or 2.06% in this calendar year so far (till 6 October 2015). From a 52-week low of 24,833.54 hit on 8 September 2015, the Sensex has risen 2,099.34 points or 8.45%. The Sensex is off 3,091.86 points or 10.29% from a record high of 30,024.74 hit on 4 March 2015.
In overseas stock markets, European shares reversed initial losses triggered by disappointing German manufacturing orders data. Asian stocks edged higher on prospects of a delay in the US Federal Reserve's plan to raise interest rates and signs of some stability in oil and commodity markets. US stocks jumped yesterday, 5 October 2015, with the S&P 500 index rising for the fifth day in a row, as rising oil prices boosted energy stocks and investors bet the Federal Reserve would not raise interest rates in calendar year 2015.
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