Firmness continued on the bourses in mid-morning trade. The barometer index, the S&P BSE Sensex, was currently hovering above the psychological 26,000 mark. Earlier, the Sensex reclaimed the psychological 26,000 after an initial surge. The Sensex was currently up 351.20 points or 1.37% at 26,065.86. Gains in global stocks underpinned sentiment on the domestic bourses.
The broad market depicted strength. There were more than three gainers against every loser on BSE. The BSE Mid-Cap index was up 1.79%. The BSE Small-Cap index was up 2.01%. Both these indices outperformed the Sensex.
In overseas markets, Asian stocks edged higher as a sharp rebound on Wall Street and gains in battered Chinese shares eased fears of a deep and protracted global market rout. US stocks witnessed a solid rally yesterday, 26 August 2015, on expectations that the US central bank will hold off from hiking interest rates next month due to mounting global uncertainties.
Capital goods shares were in demand. FMCG shares also edged higher.
Foreign portfolio investors (FPIs) pressed substantial sales of Indian stocks yesterday, 26 August 2015. FPIs sold shares worth a net Rs 2345.77 crore yesterday, 26 August 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 1881.08 crore yesterday, 26 August 2015, as per provisional data released by the stock exchanges.
Indian stocks may remain volatile today, 27 August 2015, as traders roll over positions in the futures & options (F&O) segment from the near month August 2015 series to September 2015 series. The near month August 2015 derivatives contracts are set to expire today, 27 August 2015.
At 11:16 IST, the S&P BSE Sensex was up 351.20 points or 1.37% at 26,065.86. The index jumped 455.73 points at the day's high of 26,170.39 at the onset of trading session, its highest level since 24 August 2015. The index gained 298.48 points at the day's low of 25,943.75 in early trade.
The CNX Nifty was up 112.75 points or 1.45% at 7,904.60. The index hit a high of 7,930.80 in intraday trade, its highest level since 24 August 2015. The index hit a low of 7,862.30 in intraday trade.
The BSE Mid-Cap index was up 187.40 points or 1.79% at 10,664.56. The BSE Small-Cap index was up 214.96 points or 2.01% at 10,926.69. Both these indices outperformed the Sensex.
The market breadth indicating the overall health of the market was quite strong. There were more than three gainers against every loser on BSE. 1,676 shares rose and 508 shares fell. A total of 55 shares were unchanged.
Capital goods shares were in demand. Jindal Saw (up 4.97%), Praj Industries (up 4.97%), Punj Lloyd (up 4.76%), Thermax (up 2.90%), Suzlon Energy (up 2.77%), Bharat Electronics (up 2.29%), ALSTOM India (up 1.93%), SKF India (up 1.92%), Siemens (up 1.70%), Alstom T&D India (up 1.30%), Lakshmi Machine Works (up 1.25%), BEML (up 1.21%), Havells India (up 0.90%), Larsen & Toubro (up 0.77%), ABB India (up 0.60%) and AIA Engineering (up 0.57%), edged higher. Pipavav Defence and Offshore Engineering Company (down 0.09%), Bharat Heavy Electricals (down 2.83%) and Crompton Greaves (down 3.47%) edged lower.
FMCG shares also edged higher. Jyothy Laboratories (up 3.72%), Marico (up 3.32%), Bajaj Corp (up 3.04%), Godrej Consumer Products (up 2.98%), Dabur India (up 2.24%), GlaxoSmithKline Consumer Healthcare (up 1.80%), Colgate Palmolive (India) (up 1.32%), Britannia Industries (up 1.16%), Nestle India (up 1.14%) and Procter & Gamble Hygiene & Health Care (up 0.62%), edged higher. Hindustan Unilever (down 0.28%) and Tata Global Beverages (down 0.55%) edged lower.
Gail (India) was up 1.01% to Rs 284.95. With respect to news article titled, "In talks with Iran to revive old LNG deal," GAIL (India) clarified during trading hours today, 27 August 2015, that the company had in June 2005 signed a bilateral Sale & Purchase Agreement (SPA) for import of 2 MMTPA of LNG from Iran's National Iranian Gas Export Company (NIGEC). However, the SPA was kept in abeyance after NIGEC informed GAIL that the SPA has not been ratified by the Iranian government due to Western sanctions on Iran. In a recent visit of Indian delegation to Iran, the issue of LNG export to India was discussed. Citing the SPA, GAIL has requested Iranian authorities that GAIL should be given preference for such LNG export whenever Iran is able to supply LNG, GAIL (India) said. A lifting of Western sanctions on Iran was announced in July 2015.
Vedanta was up 5.32% to Rs 90.10. With reference to the news item titled, "Vedanta Kicks off process to shut Lanjigarh refinery," Vedanta clarified during trading hours today, 27 August 2015, that aluminium prices the world over have collapsed in the past few months and current indications are that this trend will continue. The company's Lanjigarh operations have additionally been affected by the non-availability of bauxite from Odisha. As a result, the company's cost of production is significantly higher and is impacting the viability of the Lanjigarh operations. The company said it may implement gradual closure of the operations at the Lanjigarh unit.
Tata Steel was up 2.23% at Rs 220.30. Tata Steel announced during trading hours today, 27 August 2015, it has decided to focus on production of hot rolled coils at its hot strip mill in Port Talbot in south Wales in the UK. Tata Steel further said that it will stop production at some coil processing facilities and also at the hot strip mill at Llanwern in south Wales in the UK. Tata Steel said that the decision has been taken because cheap imports and a strong British pound have created a challenging business environment. Employees at the Llanwern mill will be redeployed within the business and the company will discuss possible impact with contracting companies which provide services to this unit, the company said.
Meanwhile, investors continue to watch the progress of the monsoon rains which will have a bearing on food prices and rural income. India's weather office, the India Meteorological Department (IMD), said in a daily report issued yesterday, 26 August 2015, that for the country as a whole, cumulative rainfall during this year's monsoon season was 12% below the Long Period Average (LPA) until 26 August 2015. Region wise, the rainfall was 20% below the LPA in South Peninsula, 15% below the LPA in Central India, 6% below the LPA in East & Northeast India and 6% below the LPA in Northwest India, until 26 August 2015.
The June-September southwest monsoon is critical for the country's agriculture because a considerable part of the country's farmland is dependent on the rains for irrigation.
In overseas markets, Asian stocks edged higher today, 27 August 2015, as a sharp rebound on Wall Street and gains in battered Chinese shares eased fears of a deep and protracted global market rout. Key benchmark indices in Indonesia, Japan, Singapore, South Korea and Taiwan were up by 1.06% to 3.28%.
In mainland China, the Shanghai Composite was up 1.70%. In Hong Kong, the Hang Seng index was up 2.22%. After the close of trading yesterday, 26 August 2015, China's central bank said it would inject $21.8 billion into the financial system in a new easing effort, following the central bank's interest-rate cut early this week.
US stocks witnessed a solid rally yesterday, 26 August 2015, on expectations that the US central bank will hold off from hiking interest rates next month due to mounting global uncertainties. The rally followed six days of losses for markets that have been shaken by news about China's currency and economy. New York Fed President William Dudley yesterday, 26 August 2015, said that the case for a rate hike in September is less compelling given recent international developments and volatility in financial markets.
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