Key benchmark indices drifted higher in early trade on positive Asian stocks, with the barometer index, the S&P BSE Sensex regaining the psychological 28,000 mark. At 9:25 IST, the Sensex was up 88.65 points or 0.32% at 28,030.76. The Nifty 50 index was currently up 20.95 points or 0.24% at 8,585.95
In overseas stock markets, Asian shares rose as better-than-expected economic data from China lifted risk sentiment that was already buoyant after record highs on Wall Street. China's economy grew 6.7% in the second quarter from a year earlier, steady from the first quarter and slightly better than expected as the government stepped up efforts to stabilise growth in the world's second-largest economy. US stocks extended their run into the record books yesterday, 14 July 2016 as the Dow Jones Industrial Average and the S&P 500 notched new closing highs on stronger-than-expected results from large financial institutions, including JP Morgan Chase, as well as upbeat economic data.
In Europe, the Bank of England (BOE) left key rates unchanged at 0.5% and no further additions to its 375 billion ($501.2 billion) quantitative-easing program yesterday, 14 July 2016 but said most members see looser policy coming at the August meeting. The market consensus was for a 25 basis point rate cut to 0.25%, which would've been the bank's first move since 2009, on the heels of the UK's Brexit referendum in late June, which sparked a rout in financial markets as well as fear of a recession in the UK and the eurozone.
The BOE's meeting minutes said that in the absence of a further worsening in the trade-off between supporting growth and returning inflation to target on a sustainable basis, most members of the committee expect monetary policy to be loosened in August.
Closer home, the market breadth indicating the overall health of the market was strong. On BSE, 935 shares rose and 411 shares declined. A total of 52 shares were unchanged. The BSE Mid-Cap index was currently up 0.66%. The BSE Small-Cap index was currently up 0.34%. Both these indices outperformed the Sensex.
TCS slipped 0.45% after the company's consolidated net profit as per International Financial Reporting Standards (IFRS) fell 0.4% to Rs 6317 crore on 3% rise in revenue to Rs 29305 crore in Q1 June 2016 over Q4 March 2016. Operating income fell 0.9% to Rs 7347 crore in Q1 June 2016 over Q4 March 2016. The result was announced after market hours yesterday, 14 July 2016. Commenting on the Q1 performance, N Chandrasekaran, CEO and MD, TCS, said that strong execution and accelerating customer adoption of cloud, big data & analytics has driven broad-based growth across key markets and industries. The company's investments in platforms are gaining significant traction as customers look to boost business agility and enhance their time-to-market advantage to gain a competitive edge, he added.
Rajesh Gopinathan, Chief Financial Officer, TCS, said this has been a quarter of good financial performance balancing revenue growth, profitability and cash generation. The company's disciplined approach to operations have helped counter strong headwinds in the form of annual salary hikes and promotions as well as global currency and market volatility through the quarter. The company continues to invest in people, platforms and products as it looks to strengthen competitive position across key markets, he added. TCS declared an interim dividend of Rs 6.50 per share for the year ending 31 March 2017 (FY 2017).
Infosys rose 0.71% ahead of its Q1 June 2016 results today, 15 July 2016. Reliance Industries (RIL) rose 0.35% ahead of its Q1 June 2016 results today, 15 July 2016.
HDFC shed 0.34% as the stock turned ex-dividend today, 15 July 2016 for final dividend of Rs 14 per share for the year ended 31 March 2016 (FY 2016).
Meanwhile, the company announced after market hours yesterday, 14 July 2016 that it has successfully priced its first overseas issue of unrated rupee denominated bonds yesterday, 14 July 2016. The company is the first Indian corporate issuer of rupee denominated bonds overseas pursuant to applicable Reserve Bank of India guidelines. The Rs 3000 crore issue of unsecured rupee denominated bonds bears a fixed semi-annual coupon of 7.875% per annum and has a tenor of 3 years and 1 month. The bonds have been issued at a price of 99.24% of the par value and will be redeemed at par. The all-in annualised yield to the investors is 8.33% per annum. This is a rupee based transaction and there is no foreign exchange exposure for HDFC. The bonds will be listed on the London Stock Exchange and cannot be traded in the local Indian market. The issue proceeds would be used for the housing finance business of HDFC as well as for general corporate purposes. Rupee denominated bonds are instruments through which Indian entities can raise funds by accessing overseas capital markets, while the bond investors hold the currency risk.
Hero MotoCorp (HMCL) rose 1.04% after the company after market hours yesterday, 14 July 2016, announced the launch of the new Splendor iSmart 110, the first motorcycle to be developed completely in-house, with HMCL's own technology. Built on a completely new chassis and frame, the bike is powered by the new 110cc Torque on Demand engine that also features HMCL's patented i3S technology, the company said. The bike is now available at the Hero dealerships across India. The bike is priced at Rs 53,300 ex-showroom Delhi.
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