Key benchmark indices logged modest gains in a volatile session of trade after the Reserve Bank of India (RBI) cut repo rate by 25 basis points to 6.25%. The S&P BSE Sensex rose 91.26 points or 0.32% to settle at 28,334.55. The Nifty 50 index rose 31.05 points or 0.36% to settle at 8,769.15. Positive global stocks also boosted sentiment on domestic bourses. The Sensex and the Nifty, both, hit their highest closing level in 1-1/2 weeks. Key indices gained for the third session in a row today, 4 October 2016.
The Sensex rose 91.26 points or 0.32% to settle at 28,334.55, its highest closing level since 23 September 2016. The index rose 161.41 points or 0.57% at the day's high of 28,404.70. The index fell 1.04 points at the day's low of 28,242.25.
The Nifty rose 31.05 points or 0.36% to settle at 8,769.15, its highest closing level since 23 September 2016. The index rose 45.55 points or 0.52% at the day's high of 8,783.65. The index shed 2 points or 0.02% at the day's low of 8,736.10.
The Reserve Bank of India (RBI) reduced the key policy repo rate by 25 basis points to 6.25% in its fourth bi-monthly monetary policy meeting today, 4 October 2016. Six members voted in favour of the monetary policy decision. The minutes of the MPC's meeting will be published on 18 October 2016. The decision of the Monetary Policy Committee (MPC) is consistent with an accommodative stance of monetary policy in consonance with the objective of achieving consumer price index (CPI) inflation at 5% by Q4 March 2017 and the medium-term target of 4% within a band of +/- 2%, while supporting growth, RBI said.
The momentum of growth is expected to quicken with a normal monsoon raising agricultural growth and rural demand, as well as by the stimulus to the urban consumption spending from the pay commission's award. The accommodative stance of monetary policy and comfortable liquidity conditions should support a revival of credit to the productive sectors. The continuing sluggishness in world trade and smaller terms of trade gains than in the past point, however, to further slackening of external demand going forward. Accordingly, the projection of growth of real gross value added (GVA) for 2016-17 is retained at 7.6%, with risks evenly balanced around it, RBI said.
The latest monetary policy meeting was the first meet where the interest rate decision is taken by a panel. Urjit Patel, the RBI governor, was one among the six-member Monetary Policy Committee (MPC) recently notified by the government.
In overseas stock markets, global stocks rose after data showing expansion in US manufacturing boosted optimism over the health of the world's largest economy. China's stock exchange remained closed as part of a five-day National Holiday break. US stocks closed lower yesterday, 3 October 2016 as investors digested key economic news and kept an eye on oil prices.
Closer home, the market breadth indicating the overall health of the market was positive. On BSE, 1,691 shares gained and 1,156 shares fell. A total of 131 shares were unchanged. The BSE Mid-Cap index gained 0.5%. The BSE Small-Cap index rose 0.66%. Both these indices outperformed the Sensex.
The total turnover on BSE amounted to Rs 4244.35 crore, higher than turnover of Rs 3841.40 crore registered during the previous trading session.
Among sectoral indices on BSE, the S&P BSE Industrials index (up 0.27%), the S&P BSE Auto index (up 0.05%), the S&P BSE Consumer Discretionary Goods & Services index (up 0.12%), the S&P BSE Capital Goods index (down 0.45%), the S&P BSE Power index (up 0.24%), the S&P BSE Healthcare index (up 0.16%), the S&P BSE Consumer Durables index (up 0.12%) and the S&P BSE FMCG index (up 0.09%) underperformed the Sensex. The S&P BSE Finance index (up 0.48%), the S&P BSE Bankex (up 0.42%), the S&P BSE Realty index (up 0.96%), the S&P BSE Metal index (up 0.78%), the S&P BSE Energy index (up 1.11%), the S&P BSE Utilities index (up 0.99%), the S&P BSE Basic Materials index (up 1.01%), the S&P BSE Oil & Gas index (up 2.33%), the S&P BSE Telecom index (up 1.29%), the S&P BSE Teck index (up 0.55%), and the S&P BSE IT index (up 0.68%) outperformed the Sensex.
Shares of HPL Electric & Power settled at Rs 189.05, a discount of 6.41% compared with initial public offer price of Rs 202. The stock debuted at Rs 190.05, a discount of 5.92% to the initial public offer (IPO) price. The stock hit a high of Rs 198 and low of Rs 184.30. On BSE, 33.81 lakh shares were traded on the counter. The initial public offer (IPO) of HPL Electric and Power ended on 26 September 2016. The IPO received bids for 11.64 crore shares and it was subscribed 8.06 times. The price band for the IPO was fixed at Rs 175 to Rs 202 per share. The company manufactures electrical appliances, switch-gears, electronic energy meters and electrical protection equipment.
Interest rate sensitive auto stocks were mixed after the Reserve Bank of India (RBI) cut repo rate by 25 basis points after monetary policy meeting today, 4 October 2016. Purchases of automobiles, including that of cars, utility vehicles and commercial vehicles are substantially driven by financing.
Bajaj Auto (up 0.63%), Tata Motors (up 1.6%) and Eicher Motors (up 0.2%) gained. TVS Motor Company (down 0.05%), Mahindra & Mahindra (M&M) (down 1.92%), and Ashok Leyland (down 1.87%) fell.
Hero MotoCorp rose 0.24% after the company's total sales rose 11% to 6.74 lakh units in September 2016 over September 2015. The company registered highest ever sales in any month so far in September 2016. The announcement was made after market hours yesterday, 3 October 2016. The growth momentum was backed by a series of positive factors such as the successful market launch of the Splendor iSmart 110; augmented leadership in the 125 cc segment with the 'Glamour', emerging as the largest- selling 125 cc motorcycle in the country and the positive trend maintained by the new scooter portfolio.
Maruti Suzuki India declined 0.03%. The company announced that its premium hatchback, Baleno, crossed a cumulative domestic sale of one lakh units today, 4 October 2016. Launched in October 2015, Baleno is one of the top selling models for the company. In addition to domestic sales, 33,800 Baleno cars have been exported across the world. Besides one lakh Baleno cars sold, many customers have placed orders for the car and will receive delivery in the next few months. The announcement was made during market hours today, 4 October 2016.
Bank stocks gained after the Reserve Bank of India (RBI) cut repo rate by 25 basis points after monetary policy meeting today, 4 October 2016. Among private sector banks, Kotak Mahindra Bank (up 0.51%), HDFC Bank (up 0.21%), RBL Bank (up 0.29%), ICICI Bank (up 0.84%), and Yes Bank (up 0.97%) rose. Axis Bank (down 0.75%) and IndusInd Bank (down 0.65%) fell.
Among PSU bank stocks, State Bank of India (SBI) (up 1.59%), Canara Bank (up 3.37%), IDBI Bank (up 1.48%), Punjab National Bank (up 1.57%), Indian Bank (up 0.22%), Bank of Baroda (up 0.62%), and Union Bank of India (up 5.89%) and Bank of India (up 2.15%) rose.
Dena Bank rose 3.2% after the bank said it has raised Rs 446 crore by allotting shares to the government on a preferential basis. The announcement was made during trading hours today, 4 October 2016. Dena Bank said that the issue committee of the board at its meeting held on 3 October 2016 has allotted 12.02 crore equity shares of Rs 10 each at the issue price of Rs 37.10 per equity share to the Government of India on preferential basis, aggregating upto Rs 446 crore.
Interest rate sensitive realty stocks rose after the Reserve Bank of India reduced the key policy repo rate by 25 basis points to 6.25% in its fourth bi-monthly monetary policy meeting today, 4 October 2016. Purchases of both residential and commercial property are largely driven by finance.
Unitech (up 1.33%), Sobha (up 0.72%), Godrej Properties (up 0.95%), Oberoi Realty (up 3.93%), Housing Development and Infrastructure (up 0.3%), DLF (up 0.33%), D B Realty (up 0.54%) and Sunteck Realty (up 1.82%) rose. Indiabulls Real Estate fell 0.85%.
Key indices gained for the third session in a row today, 4 October 2016. The Sensex has risen 507.02 points or 1.82%, from a close of 27,827.53 on 29 September 2016. The Sensex has risen 2,217.01 points or 8.48% in calendar year 2016 so far (till 4 October 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 5,839.94 points or 25.96%. From a 52-week high of 29,077.28 hit on 8 September 2016, the barometer index has fallen 742.73 points or 2.55%. The Sensex is off 1,690.19 points or 5.62% from a record high of 30,024.74 hit on 4 March 2015.
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