Volatility continued as the key benchmark indices regained strength soon after trimming intraday gains and hitting fresh intraday low in mid-afternoon trade. At 14:25 IST, the barometer index, the S&P BSE Sensex was up 78.61 points or 0.3% at 26,604.07. The gains for the Nifty 50 index were lower in percentage terms than those for the Sensex. The Nifty was currently up 13.75 points or 0.17% at 8,154.50. Positive global stocks boosted sentiment on the domestic bourses.
The Sensex gained 205.09 points or 0.77% at the day's high of 26,730.55 at onset of the day's trading session, its highest level since 15 June 2016. The index rose 53.28 points or 0.2% at the day's low of 26,578.74 in mid-afternoon trade. The Nifty gained 54.50 points or 0.66% at the day's high of 8,195.25, its highest level since 15 June 2016. The index rose 6.35 points or 0.07% at the day's low of 8,147.10 in mid-afternoon trade.
In overseas markets, European stocks edged higher, tracking gains in the US and Asia and underpinned by higher oil prices as worries about Brexit receded, at least for now. Meanwhile, the Bank of England yesterday, 16 June 2016 kept its key interest rate at a record low of 0.5% and made no changes to its 375-billion-pound ($530 billion) asset-purchase program. All nine rate-setting policy makers voted to hold rate unchanged. The decision marked the last before the 23 June 2016 referendum in the UK on whether the country should stay or exit the European Union (EU). A vote to leave the EU could materially alter the outlook for output and inflation, and therefore the appropriate setting of monetary policy, the BOE said in a statement. The interest rate decision was announced after close of Indian market hours yesterday, 16 June 2016.
Most Asian stocks edged higher after a rebound on Wall Street overnight ahead of the UK's upcoming 23 June 2016 referendum vote on its future within the European Union. Meanwhile, Japan's government kept its assessment of the economy unchanged this month but warned that consumer prices are rising at a slower pace, casting more doubt on policymakers' three-year effort to shake off deflation. The assessment comes a day after the Bank of Japan cut its view on consumer inflation and refrained from offering additional monetary stimulus despite a weak global economy and anaemic inflation. US stocks closed modestly higher yesterday, 16 June 2016 ending a five-day streak of losses with telecoms leading sector advancers.
Closer home, the market breadth, indicating the overall health of the market was positive on BSE. 1,259 shares advanced and 1,214 shares declined. A total of 183 shares were unchanged. The BSE Mid-Cap index was currently off 0.11%. The BSE Small-Cap index was currently up 0.2%. Both these indices underperformed the Sensex.
Pharmaceutical shares declined. Dr Reddy's Laboratories (down 1.18%), Cadila Healthcare (down 0.76%), Lupin (down 0.07%), Sun Pharmaceutical Industries (down 0.92%), Aurobindo Pharma (down 1.07%) and Wockhardt (down 1.51%) fell. Alkem Laboratories (up 1.31%), Cipla (up 0.37%), Glenmark Pharmaceuticals (up 0.04%) and GlaxoSmithKline Pharmaceuticals (up 1.47%) rose.
IT stocks were mostly higher. TCS (up 1.36%), Wipro (up 0.46%), Tech Mahindra (up 0.52%), Hexaware Technologies (up 0.5%) and MphasiS (up 0.28%) rose. Infosys (down 0.69%), HCL Technologies (down 0.19%) and Oracle Financial Services Software (down 0.8%) fell.
Coal India rose 1.86% on expectations of pick up in coal demand after coal secretary Anil Swarup appealed to state-owned power generation firms to immediately stop imports of the fuel and instead buy coal from Coal India
Swarup said during the inauguration of a two-day conference on power sector in Goa yesterday, 16 June 2016, that from a shortage situation sometime back, there are not many takers now for the 550 MT coal stock. He further said that Coal India has set up processes for auction of coal to public and private entities and a dispute resolution mechanism has also been set up by the government wherein disputes between states can also be resolved. Swarup also said that the dues to be paid to Coal India have gone up significantly which might result into pushing the company into red.
State-run Coal India is India's biggest coal miner. The Coal India stock price had lost 0.75% to settle at Rs 307.20 yesterday, 16 June 2016, when the Sensex fell 200.88 points or 0.75% to settle at 26,525.46.
GOCL Corporation rose 9.75% after the company said that its wholly-owned subsidiary IDL Explosives (IDLEL) has bagged an order worth Rs 127.71 crore for supplying of bulk explosives, cartridge explosives, nonel and detonators for blasting at all the open cast projects and underground coal mines of the Singareni Collieries Company for 2 years. The order will be catered by IDLEL and GOCL Corporation. The announcement was made during trading hours today, 17 June 2016.
Kajaria Ceramics gained 1.53% after the company announced a 2-for-1 stock split. Each equity share of Rs 2 fully paid up will be divided into 2 equity shares of Rs 1 fully paid up. The primary motive of the stock-split proposal is to improve the liquidity in company's shares in the secondary equity market and to make the shares more affordable to small investors.
MEP Infrastructure Developers rose 2.31% after the company in joint venture with Sanjose India Infrastructure & Construction has been declared as the successful bidder (L1) by National Highways Authority of India (NHAI) for a road project. The announcement was made during trading hours today, 17 June 2016. The project involves four laning of Mahuva to Kagavadar of National Highway (NH)-8E in Gujarat on hybrid annuity mode. Construction period is 2.5 years from the appointed date. Concession period is 15 years (excluding the 2.5-year construction period). The net present value (NPV) of bid project cost and operation & maintenance (O&M) bid is of Rs 586.96 crore. The company will receive bi-annual annuity from NHAI post commercial operation date. MEP Infrastructure Developers - Sanjose India Infrastructure & Construction joint venture, (hybrid annuity) order book stands at Rs 3836.99 crore to be executed over the next 2-1/2 years (from the appointed date).
V-Guard Industries jumped 6.2% after the company announced a 10-for-1 stock split. Each equity share of face value of Rs 10 each will be split into ten equity shares of face value of Rs 1 each. The stock-split proposal is aimed at improving the liquidity of the stock in the secondary equity market and also to make the stock affordable to small investors.
On the macro front, India's current account deficit (CAD) narrowed sharply to $0.3 billion (0.1% of GDP) in Q4 of 2015-16, significantly lower than $7.1 billion (1.3% of GDP) in Q3 of 2015-16 and marginally lower than $0.7 billion (0.1% of GDP) in Q4 of 2014-15. The contraction in CAD was primarily on account of a lower trade deficit ($24.8 billion) than in Q4 of last year ($31.6 billion) and $34 billion in the preceding quarter. The government announced the economic data after market hours yesterday, 16 June 2016.
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