Market is seen opening lower in the early trade tracking negative leads from Asian markets. Trading of Nifty 50 index futures on the Singapore stock exchange indicates that the Nifty could fall 18 points at the opening bell. India's stock market were closed yesterday, 7 March 2016, on account of Mahashivratri.
In overseas markets, markets in Asia lost ground today, 8 March 2016, stepping back from their recent rally, with weak China trade data weighing on the sentiment. China's February exports fell 25.4% in US dollar terms, while imports fell 13.8%. The drop in exports was the largest on-year drop since 2009. US stocks eked out small gains yesterday, 7 March 2016, while the S&P 500 and Dow industrials extend their winning streak to five straight sessions, in part thanks to a jump in oil prices.
Closer home, foreign portfolio investors (FPIs) purchased shares worth a net Rs 671.57 crore on Friday, 4 March 2016, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) sold shares worth a net Rs 533.10 crore on Friday, 4 March 2016, as per provisional data.
Meanwhile, as per the monthly data released by Association of Mutual Funds In India (AMFI), net inflow into equity mutual funds totaled Rs 2522 crore in February 2016, lower than the inflow of Rs 2914 crore in January 2016. The net inflow into balanced funds totaled Rs 941 crore in February 2016, which was higher than inflow of Rs 880 crore in January 2016. Balanced funds invest the money in a combination of equity and debt, with majority of the investment going into equity. The funds' investments range from 65% to 80% in equity and the rest in debt.
Among corporate news, Coal India said that the board of directors of the company at its meeting held on 5 March 2016, has approved payment of interim dividend of Rs 27.40 per share for the year ending 31 March 2016. The announcement was made on Saturday, 5 March 2016. The stock offers a dividend yield of 8.42% based on its closing price of Rs 325.20 on the BSE on Friday, 4 March 2016. Meanwhile, the Prime Minister Narendra Modi on Friday, 4 March 2016, reviewed the progress of key infrastructure sectors including power, coal, housing, ports, and Digital India, a statement released by the government on Saturday, 5 March 2016 said. Coal India has achieved a 9.2% increase in production this year, as compared to an average of just 3% growth over the last 5 years, the government said in a statement.
Stocks of public sector banks (PSU banks) will be in focus after Finance Minister Arun Jaitley on Saturday, 5 March 2016, said that an Experts' Group would be constituted immediately to consider a proposal for consolidation of PSU banks in order to have strong banks. Speaking to the media at the end of a two-day conference of top management of PSU banks, finance sector regulators and finance ministry officials organized by the finance ministry, Jaitley also said that the Department of Financial Services (DFS) is considering amending the Debt Recovery Tribunal (DRT) Act and SARFESI Act to help banks expedite the process of recovery of bad loans. Jaitley was quoted as saying at the press conference that the government is also considering a proposal to allow PSU banks to institute employee stock option plan for bank employees.
Asian Paints after trading hours on Friday, 4 March 2016, announced that it has filed First Information Report (FIR) with the Police department against its Registrar & Transfer Agent Sharepro Services (India) Pvt. Ltd. and its employees on certain irregularities by Sharepro with respect to share transfer operations and dividend encashment activities. Asian Paints has issued a termination notice to Sharepro for the termination of Registrar & Transfer Agent services with effect from 1 April 2016. The company is currently in the process of appointing a new Registrar & Transfer Agent.
L&T has completed the transaction for the sale of its casting manufacturing unit located at Coimbatore to Australia's Bradken Limited for total consideration of Rs 163 crore. The business transfer agreement was signed in November 2014. This unit clocked revenue of Rs 122 crore in the year ended 31 March 2015 (FY 2015), which was less than 1% of the total revenue of the company for the year. The sale of the Coimbatore foundry is in line with the company's strategic plan to exit non-core businesses and rationalize its portfolio. The company continues to operate two other foundries in Odisha and Gujarat. L&T made the announcement after trading hours on Friday, 4 March 2016.
Shares of Siemens may edge higher after the company announced that its board of directors has decided to consider the distribution of 50% of the proceeds from the sale of its healthcare undertaking as a special dividend to the company's shareholders. The board will take the decision on special dividend at its first board meeting after the completion of the transaction. The transaction is expected to be completed by 1 July 2016. Siemens has approved the sale and transfer of the healthcare undertaking as a going concern on a slump sale basis to the subsidiary of its parent firm Siemens AG, Germany for total consideration of Rs 3050 crore. The unit clocked revenue of Rs 1424.80 crore in the year ended 30 September 2015 (FY 2015), accounting for 13.55% of the company's revenue for the year. The unit had negative networth of Rs 88.50 crore as on 30 September 2015. The transaction is subject to the approval of the company's shareholders through an ordinary resolution.
Regarding the rationale for the sale of the healthcare unit to the parent firm, Siemens said that it would allow the parent firm increased flexibility, greater entrepreneurial freedom and faster decision making to grow its India healthcare segment independently. The healthcare unit is highly dependent on the parent company and its subsidiaries for products and technical know-how and that significant long-term investments are required for localization of products and solutions of the unit, Siemens said. Siemens further said that currently there are limited synergies between the healthcare business and its other business segments. The sale of the unit will allow Siemens to increase its focus and capital allocation to power generation, transmission and distribution, mobility, industrial automation and Smart Cities segments. The transaction will be margin accretive for Siemens. The company made the announcement on the sale of the healthcare unit after trading hours on Friday, 4 March 2016.
Gains for banking sector stocks, public sector companies and metal stocks offset losses for IT and telecom stocks, with key benchmark indices registering minuscule gains on Friday, 4 March 2016. The barometer index, the S&P BSE Sensex, rose 39.49 points or 0.16% to settle at 24,646.48. The 50-unit Nifty 50 index rose 9.75 points or 0.13% to settle at 7,485.35. The two key benchmark indices witnessed intraday volatility, swinging alternately between positive and negative zone. With fourth straight day of gains, the Sensex attained 4-1/2-week closing high and the Nifty reached 4-week closing high.
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