Key equity benchmarks surged amid broad based buying support on Thursday. Shares rallied after media reports suggested that the government is likely to roll back recently-imposed higher tax on foreign portfolio investors (FPIs). Prime Minister Narendra Modi will address the nation at 8:00 pm tonight.
The Sensex ended above the 37,000 level while the Nifty crossed the 11,000 mark. Trading was volatile on account of expiry of weekly options contracts on the NSE.
The Sensex rose 636.86 points or 1.74% to settle at 37,327.36. The index surged 714.98 points, or 1.95% at the day's high of 37,405.48. The index fell 35.09 points, or 0.10% at the day's low of 36,655.41.
The Nifty 50 index rose 176.95 points or 1.63% to settle at 11,032.45. The index rose 202.55 points, or 1.87% at the day's high of 11,058.05. The index fell 12.55 points, or 0.12% at the day's low of 10,842.95.
In the broader market, the S&P BSE Mid-Cap index rose 0.42%. The S&P BSE Small-Cap index gained 0.74%.
The market breadth, indicating the overall health of the market, was positive. On the BSE, 1375 shares rose and 1033 shares fell. A total of 152 shares were unchanged.
Among the sectoral indices on the BSE, the S&P BSE Energy index (up 3.15%), the S&P BSE Auto index (up 2.77%) and the S&P BSE IT index (up 1.98%) outperformed the S&P BSE Sensex. Meanwhile, the S&P BSE Basic Materials index (up 0.27%), the S&P BSE Capital Goods index (up 0.53%) and the S&P BSE Consumer Durables index (up 0.66%) underperformed the S&P BSE Sensex.
According to media reports, the government may withdraw the foreign portfolio investors (FPIs) surcharge through a notification or ordinance. The government is working on a confidence-booster package for investors that included a re-thinking on the long-term capital gains tax, reports added.
Foreign investors have been selling extensively in the Indian equity market after the government announced levy of surcharge on super rich in the Union Budget. Finance minister Nirmala Sitharaman in her maiden Budget speech on 5 July 2019, proposed to enhance surcharge on individuals having taxable income from Rs 2 crore to Rs 5 crore and Rs 5 crore and above so that effective tax rates for these two categories will increase by around 3% and 7% respectively. The effective tax rate on the highest tax bracket goes up to 42.7% after the hike.
There are concerns that the increased surcharge on super-rich could also affect foreign funds investing in India since a same tax structures apply for individuals, Hindu Undivided Family (HUF) and Associations of Persons (AOPs). FPIs, including pension and retirement funds, educational endowment fund, etc, come in through trusts or AOPs route because it has been the most tax-efficient structure.
On the equity front, HCL Technologies rose 6.43%. The company's consolidated net profit fell 12.54% to Rs 2,230 crore on a 2.73% increase in net sales to Rs 16,427 crore in Q1 June 2019 compared with Q4 March 2019. The result was announced after trading hours yesterday, 7 August 2019.
The firm's consolidated EBITDA also declined 5.4% to Rs 3,225 crore in Q1 June 2019 as against Q4 March 2019. The consolidated EBITDA margin grew to 23.2% in Q1 June 2019 from 22.4% in Q4 March 2019.
HCL Technologies expects revenues for the FY 2019-20 to grow between 14% to 16% in constant currency. The operating margin (EBIT) for the FY 2019-20 is expected to range from 18.5% to 19.5%.
Index major Reliance Industries (RIL) rose 3.87%. As per reports, RIL is partnering with US-based luxury jeweller Tiffany & Co to open a line of stores in the country. Tiffany plans to open stores in New Delhi and Mumbai in the second half of fiscal years 2019 and 2020 respectively, the report added.
HPCL rose 2.56%. The company's consolidated net profit declined 55.9% to Rs 877.48 crore on 5% increase in net sales to Rs 70776.43 crore in Q1 June 2019 over Q1 June 2018. The result was announced after market hours yesterday, 7 August 2019.
On standalone basis, the company's consolidated net profit declined 52.8% to Rs 810.95 crore on 5% increase in net sales to Rs 70710.53 crore in Q1 June 2019 over Q1 June 2018.
The average gross refining margin was at $0.75 per barrel in Q1 June 2019 as against $7.15 per barrel in Q1 June 2018.
Adani Enterprises rose 3.98% after the company after consolidated net profit jumped 611.4% to Rs 570.14 crore on 39.74% rise in net sales to Rs 10561.37 crore in Q1 June 2019 over Q1 June 2018. The result was announced during the market hours today, 8 August 2019.
Ultratech Cement slipped 2.57%. On a consolidated basis, the cement maker's net profit rose 91.10% to Rs 1,207.81crore on a 14.35% rise in the revenue from operations to Rs 10,177.63 crore in Q1 June 2019 over Q1 June 2018. The result was announced during market hours today, 8 August 2019.
Shares of Affle (India) settled at Rs 875.10, a premium of 17.46% over the initial public offer (IPO) price of Rs 745. The stock debuted today at Rs 929.90, a premium of 24.81% to the IPO price. The stock hit a high of Rs 958.30 and low of Rs 751.05 in the intraday. On BSE, 8.62 lakh shares were traded on the counter.
Auto stocks were in demand. Tata Motors (up 5.58%), Escorts (up 4.75%), TVS Motor Company (up 4.08%), Mahindra & Mahindra (up 4.06%), Bajaj Auto (up 3.99%), Ashok Leyland (up 3.92%), Hero MotoCorp (up 3.19%) and Eicher Motors (up 2.23%) declined.
Maruti Suzuki India gained 2.62%. The car marker announced the production figures for the month of July 2019 after market hours yesterday, 7 August 2019. The company reported a 25.36% decline in the total production to 1.33 lakh units while the total passenger vehicles' production fell 25.60% to 1.30 lakh units.
Auto industry majors reportedly met Finance Minister Nirmala Sitharaman to seek stimulus package to spur demand. The auto leader have also requested for GST reduction, more liquidity and relaxation of credit facilities for retailers.
Abbott India jumped 3.77%. The MNC associate reported 41.92% rise in the net profit to Rs 116.94 crore on a 18.22% increase in the revenue from operations to Rs 998.89 crore in Q1 June 2019 over Q1 June 2018. The result was announced during market hours today, 8 August 2019.
Siemens rose 4.42% after consolidated net profit rose 21.3% to Rs 250.10 crore on a 4.7% increase in net sales to Rs 3,128.10 crore in Q3 June 2019 compared with Q3 June 2018. The result was announced after trading hours yesterday, 7 August 2019.
Tata Steel lost 3.77%. The steel maker's consolidated net profit dropped 63.58% to Rs 710.50 crore on 1.16% rise in total income to Rs 36320.02 crore in Q1 June 2019 over Q1 June 2018. The result was announced after market hours yesterday, 7 August 2019.
Tata Steel's consolidated earnings before interest tax depreciation and amortization (EBITDA) declined 21.7% to Rs 5530 crore in Q1 June 2019 over Q1 June 2018. The company's consolidated steel production rose 11% to 7.15 million tonnes.
The company stated that during Q1 June 2019, steel prices across geographies declined with weakening economic activities and uncertainty around the ongoing US-China trade conflict. This coincided with a sharp rise in iron ore prices due to supply disruptions and elevated coking coal costs. As a result, steel spreads dropped by around US$ 80-100 per tonne in key markets.
In India, steel prices declined as subdued economic activity, seasonal slowdown and liquidity issues weighed on domestic consumption. Higher net imports further exacerbated the demand supply balance.
In Europe, the steel industry faced significant headwinds in terms of lower economic growth, uncertainty around Brexit and the trade conflict. This coupled with rising share of imports and elevated raw material prices has led to a sharp declined in steel spreads.
NBCC (India) rose 4.34%. The civil engineering enterprise secured the total business of Rs 201.77 crore in June and July 2019. The announcement was made after market hours yesterday, 7 August 2019.
Dilip Buildcon gained 2.34%. The promoters of the company, Dilip Suryavanshi, Devendra Jain and Ms. Seema Suryavanshi, have proposed to divest part of their shareholding in the company. The promoters will divest 0.63% of the total equity capital of the company aggregating upto 8.64 lakh shares. The stake sale in undertake in connection with manner of achieving minimum public shareholding. The announcement was made after market hours yesterday, 7 August 2019.
Aurobindo Pharma jumped 7.75%. The company's consolidated net profit jumped 41.6% to Rs 645.18 crore on 28.1% increase in net sales to Rs 5356.84 crore in Q1 June 2019 over Q1 June 2018. The result was announced after market hours yesterday, 7 August 2019.
The company's earnings before interest tax depreciation and amortization (EBITDA) increased 47.1% to Rs 1146.4 crore in Q1 June 2019 compared with Rs 779.2 crore in Q1 June 2018. The EBITDA margin was at 21.1% in Q1 June 2019 as compared to 18.3% in Q1 June 2018.
Emami rose 1.38%. On a consolidated basis, the personal care & healthcare products company's profit after tax rose 47% to Rs 39 crore on a 6% rise in the revenue from operations to Rs 649 crore in Q1 June 2019 over Q1 June 2018. The result was announced during market hours today, 8 August 2019.
Jindal Steel & Power fell 2.20%. The company clarified that all speculations/rumors with respect to payment default are baseless and false in nature. The company strongly reiterates that it is on track to deliver its highest ever volumes this year and should be able to generate better returns for its stakeholders. The result was announced after market hours yesterday, 7 August 2019.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 70.63, compared with its close of 70.89 during the previous trading session.
In the commodities market, Brent crude for October 2019 settlement was up 73 cents at $56.95 a barrel. The contract fell $2.71 or 4.59% to settle at $56.23 a barrel during the previous trading session.
Overseas, European stocks were trading higher while most Asian stocks ended higher as Chinese customs data showed a surprise jump in the country's July exports despite a protracted trade war with the United States.
China on Thursday said its U.S. dollar-denominated exports in July rose 3.3% from a year ago while imports fell 5.6% during the same period. The country's overall trade surplus last month was $45.06 billion, according to customs data.
China's trade surplus with the U.S. was $27.97 billion in July, lower than the previous month's $29.92 billion, the data showed. From January to July, China's trade surplus with the U.S. has totaled $168.5 billion.
US stocks recovered from steep early losses on Wednesday as investors snapped up oversold shares and bond yields rebounded from significant lows that raised fears about a recession.
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