Losses for index heavyweights Infosys, ITC, HDFC and auto stocks led losses for key benchmark indices. At 12:18 IST, the barometer index, the S&P BSE Sensex, was down 199.67 points or 0.77% at 25,864.45. The Nifty 50 index was down 55.90 points or 0.7% at 7,924. The Sensex continued to hover below the psychologically important 26,000 mark after falling below that level in mid-morning trade. The weakness on the domestic bourses stemmed from weakness in global stocks. Japanese stocks led losses for Asian stocks after the Bank of Japan left its main policies unchanged after the conclusion of a two-day monetary policy meeting, disappointing market expectations the central bank would take further extraordinary steps to stimulate Japan's economy.
The Sensex fell 239.41 points, or 0.92% at the day's low of 25,824.71 in early afternoon trade, its lowest level since 26 April 2016. The barometer index rose 36.42 points, or 0.14% at the day's high of 26,100.54 in early trade, its highest intraday level since 4 January 2016. The Nifty fell 71.50 points, or 0.90% at the day's low of 7,908.40 in early afternoon trade, its lowest level since 26 April 2016. The index rose 12.10 points, or 0.15% at the day's high of 7,992 in morning trade, its highest level since 6 November 2015.
The market may remain volatile as traders roll over positions in the futures & options (F&O) segment from the near month April 2016 series to May 2016 series. The near month April 2016 derivatives contracts expire today, 28 April 2016.
The market breadth indicating the overall health of the market was negative. On BSE, 1,333 shares fell and 898 shares rose. A total of 150 shares were unchanged. The BSE Mid-Cap index was currently down 0.12%. The BSE Small-Cap index was currently down 0.34%. The decline in both these indices was lower than the Sensex's decline in percentage terms.
In overseas stock markets, Japanese stocks led losses for Asian equities after the Bank of Japan left its main policies unchanged after the conclusion of a two-day monetary policy meeting, disappointing market expectations the central bank would take further extraordinary steps to stimulate Japan's economy. The Nikkei 225 Average ended 3.61% lower. The Bank of Japan (BOJ) voted to keep its current level of asset purchases unchanged and rates on hold while announcing a 300 billion ($2.69 billion) lending program to support banks in the region hit by this month's Kyushu earthquake.
Trading in US index futures indicated that the Dow Jones Industrial Average could fall 104 points at the opening bell today, 28 April 2016. US stocks closed mostly higher yesterday, 27 April 2016, but the gains were checked by weakness in the technology sector. Meanwhile, the Federal Reserve left interest rates unchanged after the conclusion of a two-day monetary policy meeting yesterday, 27 April 2016. The Fed's signal that it was in no rush to raise rates relieved investors.
Car major Maruti Suzuki India fell 0.95% to Rs 3,825.50 as Japanese yen strengthened against the dollar after the Bank of Japan surprised financial markets by keeping its main policies unchanged after the conclusion of a two-day monetary policy meeting. A strong yen adversely impacts Maruti Suzuki India's (Maruti) operating profit margin. Maruti pays royalty to its Japanese parent Suzuki Motor Corporation in yen terms for some of its earlier models. As per recent media reports, Maruti will start paying royalty to its Japanese parent in rupee term on all new models from the current financial year, which began on 1 April 2016. Maruti also has an exposure to the yen to the extent it imports raw materials from Japan.
State-run oil marketing firm BPCL was down 0.30% at Rs 977.90 after the Union Cabinet gave its approval to enhance investment by BPCL in Bharat Oman Refineries (BORL). The investment amount could be enhanced upto a maximum of Rs 3000 crore by way of subscription of convertible warrants/other instruments giving right to convert it into equity shares to be issued by BORL, beyond DPE guidelines dated 5 August 2005. The infusion of funds by BPCL will enable BORL to overcome the implications on account of the erosion of the net worth.
Bharat Oman Refineries (BORL) is a joint venture company between BPCL and Oman Oil Company (OOCL). BORL proposes to undertake a de-bottlenecking project at Bina refinery in Madhya Pradesh to further increase the refining capacity from 6 MMTPA to 7.8 MMTPA. The estimated project cost is Rs 3072 crore, with an overall implementation schedule of 36 months from date of receipt of environmental clearances. The highlights of the proposal for de-bottlenecking project include certain modifications to produce products in accordance to the new Auto Fuel Policy. OOCL while expressing its support for the project has indicated that it is not prepared to commit further funds for the project at this stage.
Sugar stocks tumbled after the central government allowed state governments to impose and enforce stock limits to check increase in sugar price. Empee Sugars and Chemicals (down 5.49%), Oudh Sugar Mills (down 5.25%), Upper Ganges Sugar & Industries (down 3.83%), Rana Sugars (down 3.63%), Sakthi Sugars (down 3.52%), Dhampur Sugar Mills (down 2.38%), Dwarikesh Sugar Industries (down 2.33%), Triveni Engineering & Industries (down 2.26%), KCP Sugar & Industries Corporation (down 1.57%), Bajaj Hindusthan Sugar (down 1.53%), Shree Renuka Sugar (down 1.34%), Balrampur Chini Mills (down 1.09%), EID Parry (India) (down 0.89%) and DCM Shriram Industries (down 0.63%), edged lower.
The Union Cabinet has given its approval to bring sugar under the purview of imposing stock holding limits on dealers of sugar, keeping in view the recent upward trend in sugar prices. The central government has taken stock of the availability of sugar and different factors contributing to rise in market prices of sugar across the country. In order to check the inflationary tendencies in sugar and to reduce hoarding by wholesalers and retailers, the government felt an immediate need to bring sugar within the purview of stock limits. The decision will empower state and central agencies to impose stock limits and regulate supply, distribution, storage and trade of sugar to bring down sugar prices at reasonable level by curbing unscrupulous trading, according to a government statement.
Yes Bank rose 2.69% to Rs 940.25, with the stock extending Wednesday's gains triggered by the bank reporting strong Q4 March 2016 results during trading hours yesterday, 27 April 2016. The stock had risen 0.55% to settle at Rs 915.60 on that day. Yes Bank's net profit rose 27.42% to Rs 702.11 crore on 17.73% rise in total income to Rs 4331.11 crore in Q4 March 2016 over Q4 March 2015. The bank's provisions and contingencies jumped 47.56% to Rs 186.46 crore in Q4 March 2016 over Q4 March 2015. The provision coverage ratio dropped to 62% as on 31 March 2016 from 66.5% as on 31 December 2015. The provision coverage ratio stood at 72% as on 31 March 2015.
Yes Bank's gross non-performing assets (NPA) stood at Rs 748.98 crore as on 31 March 2016 as against Rs 558.57 crore as on 31 December 2015 and Rs 313.40 crore as on 31 March 2015. The ratio of gross NPA to gross advances stood at 0.76% as on 31 March 2016 as against 0.66% as on 31 December 2015 and 0.41% as on 31 March 2015. The ratio of net NPA to net advances stood at 0.29% as on 31 March 2016 as against 0.22% as on 31 December 2015 and 0.12% as on 31 March 2015.
Meanwhile, according to media reports four foreign brokerages have raised their target price on Yes Bank stock in the wake of the bank's impressive Q4 earnings.
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