Key benchmark indices continued to trade firm in mid-afternoon trade as firmness in European stocks supported domestic bourses. The S&P BSE Sensex was up 184.26 points or 0.94%, off about 100 points from the day's high and up close to 75 points from the day's low. The market breadth, indicating the overall health of the market, was negative.
Infosys pared intraday gains after the company retained its guidance of 6% to 10% growth in revenue in dollar terms for the year ending 31 March 2014 (FY 2014) after announcing Q1 June 2013 results before trading hours. Tech Mahindra hit 52-week high. Pharma stocks gained on renewed buying, with Dr Reddy's Laboratories and Sun Pharmaceutical Industries hitting record high.
The 50-unit CNX Nifty fell below the psychological 6,000 level soon after a firm opening took the index above that level at the onset of the trading session. The market further pared gains to hit fresh intraday low in morning trade. The market regained strength in mid-morning trade. Firmness continued in early afternoon trade. Key benchmark indices pared gains in a range bound market in afternoon trade. It continued to trade firm in mid-afternoon trade.
The market sentiment was boosted by data showing that foreign funds remained net buyers of Indian stocks on Thursday, 11 July 2013. Foreign institutional investors (FIIs) bought shares worth a net Rs 638.26 crore on Thursday, 11 July 2013, as per provisional data from the stock exchanges.
At 14:20 IST, the S&P BSE Sensex was up 184.26 points or 0.94% to 19,860.32. The index jumped 286.72 points at the day's high of 19,962.78 in early trade, its highest level since 31 May 2013. The index gained 109.53 points at the day's low of 19,785.59 in morning trade.
The CNX Nifty was up 40.70 points or 0.69% to 5,975.60. The index hit a high of 6,018.40 in intraday trade, its highest level since 31 May 2013. The index hit a low of 5,951.15 in intraday trade.
The market breadth, indicating the overall health of the market, was negative. On BSE, 1,166 shares fell and 929 shares rose. A total of 131 shares were unchanged.
From the 30-share Sensex pack, 18 stocks rose and rest of them fell. Maruti Suzuki India (down 2.85%), ONGC (down 3.02%) and M&M (down 1.8%), edged lower.
Infosys surged 9.89% to Rs 2,769. The stock jumped 14.96% at the day's high of Rs 2,905 in initial trade. It hit low of Rs 2749 in intraday trade so far. On BSE, 6.48 lakh shares changed hands on the counter, compared with average daily volume of 1.36 lakh shares in the past one quarter. The company retained its guidance of 6% to 10% growth in revenue in dollar terms for the year ending 31 March 2014 (FY 2014) at the time of announcing Q1 June 2013 result before market hours today, 12 July 2013. The company has raised the guidance in rupee terms due to a steep depreciation of the rupee against the dollar. The company has forecast 13% to 17% growth in revenue in rupee terms for FY 2014, higher than its earlier guidance of 6% to 10% growth which the company had given at the time of announcement of Q4 March 2013 results.
The company's consolidated net profit declined 0.8% to Rs 2374 crore on 7.8% growth in revenue to Rs 11267 crore in Q1 June 2013 over Q4 March 2013. The results are as per International Financial Reporting Standards (IFRS).
Infosys Chief Financial Officer (CFO) Rajiv Bansal said that the company has announced compensation increases for FY 2014 effective July which will affect the company's profit margins in the future quarters. Infosys CEO and Managing Director S. D. Shibulal said that the management is cautiously optimistic about rest of the year. Despite facing an uncertain macro environment, changing regulatory regime and a volatile currency environment, the company has done well in Q1 June 2013, he said.
Infosys and its subsidiaries added 66 clients in Q1 June 2013. There was a gross addition of 10,138 employees and net addition of 575 employees by Infosys and its subsidiaries in Q1.
Tech Mahindra rose 3.14% to Rs 1100.30. The stock hit 52-wek high of Rs 1126.80 in intraday trade today, 12 July 2013.Tech Mahindra today, 12 July 2013 announced that it has completed the process of allocating shares of the company to the shareholders of Mahindra Satyam. The issued capital of the company has gone up from earlier 12.9 crore shares to 23.20 crore shares. Subsequent to the scheme of amalgamation between Tech Mahindra and Mahindra Satyam becoming effective, the board of directors fixed 5 July 2013 for Mahindra Satyam shareholders. The share swap has since been completed and the stock exchanges have accorded their approval for trading the new shares on 12 July 2013.
DLF fell 1.63%. The company said today, 12 July 2103 that it has entered into definitive Business Transfer Agreement with Goyal MG Gases Private for transferring of an unit comprising of 11.2 megawatts (MW) capacity wind turbines situated at Gadag, Karnataka on 'as is where is basis' by way of slump-sale for a lump sum consideration of Rs 29.52 crore subject to adjustment for net working capital. Upon fulfilment of the terms and conditions by both the parties in accordance with the said agreement, the entire unit as mentioned above including related assets and liabilities along with relevant long term loans would be vested to Goyal MG Gases Private. The shareholders of the Company had approved the sale of the said unit on 20 July 2012.
The transaction is expected to be consummated by 31 December 2013, subject to regulatory approvals. The transaction is in line with the DLF's objective of divesting its non core assets.
Pharma stocks gained on renewed buying. Cipla, Lupin, and Wockhardt rose by 0.42% to 4.23%. Ranbaxy Laboratories fell 1.61%.
Dr Reddy's Laboratories rose 1.79% to Rs 2331.95. The stock hit record high of Rs 2333.40 in intraday trade today, 12 July 2013. The company announced during market hours today, 12 July 2013 that it has launched Decitabine for Injection (50 mg), a therapeutic equivalent generic version of Dacogen (Decitabine for Injection), in the US market on 11 July 2013, following the approval by the United States Food & Drugs Administration (USFDA) of Dr Reddy's ANDA for Decitabine for Injection. The Dacogen brand had sales of approximately $260 million for twelve months ending July 2013 in the US according to IMS Health data.
Shares of Dr Reddy's Lab turned ex-dividend today, 12 July 2013, for final dividend of Rs 15 per share for the year ended 31 March 2013 (FY 2013).
Sun Pharmaceutical Industries rose 0.01% to Rs 1096 after the company announced before market hours today, 12 July 2013, that USFDA has granted its subsidiary final approval for its Abbreviated New Drug Applications (ANDA) for generic version of Prandin, Repaglinide tablets. The stock pared gains after hitting record high of Rs 1111 in intraday trade today, 12 July 2013. Repaglinide tablets, 1 mg and 2 mg are therapeutic equivalents of Novo Nordisk's Prandin tablets. These tablets have annual sales of approximately $200 million in the US. Repaglinide tablets are indicated as an adjunct to diet and exercise to improve glycemic control in adults with type-2 diabetes mellitus. Sun Pharma's subsidiary, being the first-to-file an ANDA for generic Prandin with a para IV certification, is eligible for a 180-day marketing exclusivity in the US.
On macro front, industrial production is seen rising a tepid 1.5% in May 2013, as per the median estimate of a poll of economists carried out by Capital Market. Industrial production had risen 2.3% in April 2013. The government unveils industrial production data for May 2013 today, 12 July 2013.
Inflation based on the combined consumer price index (CPI) of urban and rural India is projected at 9.3% in June 2013, same as in May 2013, as per the median estimate of a poll of economists carried out by Capital Market. CPI inflation had eased to 9.31% in May 2013 from 9.39% in April 2013. The government unveils CPI data for June 2013 today, 12 July 2013.
European stock markets rose for a fifth straight day on Friday, tracking gains in the US market on easing concerns of a near-term cut in US stimulus. Key benchmark indices in UK, France and Germany were up by 0.22% to 0.86%.
Most Asian stocks fell on Friday, 12 July 2013, as investors turned cautious ahead of Chinese data, including second-quarter growth and June industrial production which is scheduled for release next week. Key benchmark indices in China, Hong Kong, Indonesia, Singapore and South Korea fell by 0.06% to 1.62%. Key benchmark indices in Taiwan, and Japan rose by 0.23% to 0.50%.
China's finance minister on Friday, 12 July 2013, said economic growth will likely average 7% this year. The projection is lower than the government's target of 7.5%.
Singapore's economy grew at the fastest pace in more than two years last quarter as services strengthened and manufacturing rebounded, reducing pressure on the central bank to ease monetary policy. Gross domestic product rose an annualized 15.2% in the three months through June from the previous quarter, when it grew 1.8%, the Trade Ministry said in a statement today.
Trading in US index futures indicated a flat opening of US stocks on Friday, 12 July 2013. US stocks surged to an all-time high on Thursday after the Federal Reserve chairman Ben Bernanke said on Wednesday, 10 July 2013, the central bank will keep supporting the economy. In a speech late Wednesday after US markets had closed, Fed chairman Ben Bernanke said the economy needs the central bank's easy-money policy for the foreseeable future. The US economy needs help because unemployment is high, he said.
On Wednesday, 10 June 2013, the minutes of the Fed's June meeting showed that while "several members judged that a reduction in asset purchases would likely soon be warranted," many want to see further improvement in the labor market before reducing the central bank's $85 billion-a-month quantitative easing program. The Fed currently buys $85 billion a month in government and mortgage bonds in an effort to keep interest rates low and stimulate economic growth. At a press conference following the June 18-19 meeting, Bernanke said the central bank could start reducing its $85 billion in monthly bond purchases later this year if the economy continues to improve in line with its forecasts.
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