Nifty hits one-week closing high
Positive global stocks and reports indicating sooner than expected implementation of the Goods and Services Tax (GST), the biggest tax reform helped key benchmark indices log strong gains. The barometer index, the S&P BSE Sensex gained 330.63 points or 1.25% to settle at 26,726.34. The Nifty 50 index gained 97.75 points or 1.21% to settle at 8,206.60. The Sensex hit almost one-week closing high. The Nifty hit highest closing level in one week. After opening with an upward gap, key indices remained in positive terrain throughout the session with buying momentum gathering pace in late trade. Key indices snapped four-day losing streak today, 15 June 2016 with all the nineteen sectoral indices on BSE gaining in a firm market.
The Sensex gained 330.63 points or 1.25% to settle at 26,726.34, its highest closing level since 9 June 2016. The index rose 356.88 points or 1.35% at the day's high of 26,752.59. The index rose 50.88 points or 0.19% at the day's low of 26,446.59.
The Nifty 50 index gained 97.75 points or 1.21% to settle at 8,206.60, its highest closing level since 8 June 2016. The index gained 104.35 points or 1.29% at the day's high of 8,213.20. The index rose 14.30 points or 0.18% at the day's high of 8,123.15.
Goods and Services Tax (GST), the biggest tax reform of the country, is likely to be implemented sooner than expected, reports quoting Finance Minister Arun Jaitley indicated. After attending a meeting of finance ministers of 22 states in Kolkata yesterday, 14 June 2016, Jaitley reportedly said that all states except Tamil Nadu have agreed on the broader contours of GST. The meeting has agreed that issues of dual control and revenue neutral rate should be dealt by the Empowered Committee and not to cap the GST rate in the Bill.
In overseas markets, European stocks edged higher, snapping a five-day losing streak, as miners and retailers advanced, while traders awaited outcome of the Federal Reserve's latest policy review. Exports from the eurozone to the rest of the world jumped in April, pushing its trade surplus wider and indicating that the currency area's modest recovery remained on track as the second quarter got underway. On a seasonally adjusted basis, exports rose by 4.9% from March, while imports rose by 2.6%, while the trade surplus widened to EUR28 billion in April from EUR23.7 billion in March.
Chinese mainland markets rose, shrugging off a decision by stock index provider MSCI saying yesterday, 14 June 2016 to delay inclusion of mainland-traded Chinese A shares in its key emerging market index. In mainland China, the Shanghai Composite index closed 1.58% higher. In Hong Kong, the Hang Seng index closed 0.39% higher. In Japan, the Nikkei 225 index settled 0.38% higher. Other Asian stocks were trading mixed as investors awaited outcome of the central bank meetings in the US and Japan. The US Federal Open Market Committee concludes its two-day meeting today, 15 June 2016 while the Bank of Japan will start its two-day meeting today, 15 June 2016. The Federal Reserve is expected to keep interest rates unchanged and signal if it still plans to raise rates twice in 2016 amid concerns about a US hiring slowdown and Britain's possible exit from the European Union.
Closer home, the market breadth indicating the overall health of the market was strong. On BSE, 1,674 shares gained and 954 shares declined. A total of 176 shares were unchanged. The BSE Mid-Cap index rose 0.58%. The BSE Small-Cap index gained 0.8%. Both these indices underperformed the Sensex.
All the nineteen sectoral indices on BSE were in the green. The S&P BSE Utilities index (up 2.06%), the S&P BSE Power index (up 1.99%), the S&P BSE Bankex (up 1.38%), the S&P BSE Industrials index (up 1.31%), and the S&P BSE Capital Goods index (up 2.26%) outperformed the Sensex.
The S&P BSE Realty index (up 0.34%), the S&P BSE Consumer Durables index (up 0.09%), the S&P BSE Telecom index (up 0.85%), the S&P BSE Metal index (up 0.79%), the S&P BSE Finance index (up 1.16%), the S&P BSE Auto index (up 0.84%), the S&P BSE Healthcare index (up 0.15%), the S&P BSE FMCG index (up 0.94%), the S&P BSE Energy index (up 0.84%), the S&P BSE Oil & Gas index (up 1.14%), the S&P BSE Basic Materials index (up 1.15%), the S&P BSE Consumer Discretionary Goods & Services index (up 0.93%), the S&P BSE Teck index (up 0.94%) and the S&P BSE IT index (up 0.91%) underperformed the Sensex.
The total turnover on BSE amounted to Rs 2936.15 crore, higher than turnover of Rs 2733.26 crore registered during the previous trading session.
Index heavyweight and cigarette major ITC rose 1.75% to Rs 359.50. The stock hit a high of Rs 360 and low of Rs 353.65 in intraday trade.
Capital goods stocks edged higher. ABB India (up 1.5%), Bharat Electronics (up 1.14%), Crompton Greaves (up 3.32%), Siemens (up 1.11%), and Thermax (up 0.46%) gained. BEML fell 0.35%.
Index heavyweight and engineering and construction major L&T advanced 3.32% to Rs 1,509. The stock hit high of Rs 1,512.50 and low of Rs 1,461.10 in intraday trade.
Bharat Heavy Electricals (Bhel) rose 0.82% after the company said that continuing project commissioning momentum, it has successfully commissioned another 195 megawatts (MW) thermal unit in Bihar. This is the second 195 MW unit to be commissioned by Bhel at Muzaffarpur Thermal Power Station (TPS) Stage-II of Kanti Bijlee Utpadan Nigam (KBUNL), a joint venture of NTPC and BSPGCL, in Bihar. The first 195 MW unit at Muzaffarpur TPS Stage-II was commissioned earlier by the company in March 2015, Bhel said.
Bank stocks gained. Among public sector banks, Punjab National Bank (up 1.01%), Bank of Baroda (up 1.98%), Union Bank of India (up 1.89%), Canara Bank (up 1.07%), and Bank of India (up 1%) edged higher.
Shares of State Bank of India (SBI) and its associate banks spurted on reports that the Union Cabinet may approve the proposed merger of associate banks with SBI today, 15 June 2016. State Bank of Mysore (up 20%), State Bank of Travancore (up 20%), State Bank of Bikaner and Jaipur (up 20%) and State Bank of India (up 3.9%) edged higher.
Earlier on 17 May 2016, State Bank of India (SBI) announced that it is seeking in principle sanction of the Government of India (GoI) to enter into negotiation with its 5 subsidiary banks viz. State Bank of Bikaner and Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala and State Bank of Travancore to acquire their businesses including assets and liabilities. The decision is purely exploratory at this stage and there is no certainty in relation to SBI completing the acquisitions, SBI said. SBI's board of directors will take a final call after evaluating all the relevant considerations. SBI also said that it is considering acquisition of the newly-created Bharatiya Mahila Bank.
In May 2016, government officials were quoted by the media as saying that no legislative changes will be required for SBI merger and that the process may get completed within this fiscal. SBI Chairman Arundhati Bhattacharya had told the media that the benefits of merger would be huge and one of them will be 100 basis points reduction in lending cost within a year post this merger.
Brokerages, which see merger a positive development, had reportedly said employee integration and their cost will be the key to watch out for when the merger will take place. According to brokerages, the merger is long term positive for SBI, but financially it may be negative in the near term due to higher retirement cost, reports said.
While explaining the importance of staff cost, a foreign brokerage reportedly highlighted earlier merger of SBI. In its note, the brokerage reportedly said that SBI had to make additional employee provisions in the case of merger with its subsidiaries historically. This was due to likely rationalization of pay scales, and higher retirement related benefits. Currently SBI subsidiaries get only two retirement related benefits versus three at SBI (pension, provident fund and gratuity), reports suggested.
Among private sector banks, HDFC Bank (up 1.25%), ICICI Bank (up 1.22%), Kotak Mahindra Bank (up 2.09%), Yes Bank (up 0.49%), and IndusInd Bank (up 0.59%) edged higher. Axis Bank declined 0.35%.
Shares of power generation and power distribution companies gained. NTPC (up 3.88%), Torrent Power (up 3.74%), Adani Power (up 0.17%), Power Grid Corporation of India (up 2.52%), and Reliance Power (up 0.38%) gained. NHPC (down 0.4%) and Reliance Infrastructure (down 0.75%) declined.
Tata Power Company gained 0.99%. The company announced that Tata Power Renewable Energy (TPREL), a wholly owned subsidiary of the company successfully issued and allotted guaranteed, unsecured, non-cumulative, redeemable, taxable, listed, rated non-convertible debentures of Rs 575 crore on private placement basis. The announcement was made after market hours today, 15 June 2016. The NCDs will carry a spread of 0.14% above 6 month marginal cost of lending rate (MCLR) of HDFC Bank payable semi annually and are guaranteed by the company. The proceeds from the NCDs will be primarily used to prepay existing higher cost debt in TPREL. The guarantee agreement has been entered to guarantee payment obligation of TPREL pursuant to the NCDs. The guarantee is capped at Rs 625 crore and will fall off once the NCDs are fully repaid. This will create contingent liability not exceeding Rs 625 crore for the company.
Coal India rose 0.29% after the company announced after market hours yesterday, 14 June 2016, that the board of directors of its subsidiary, South Eastern Coalfields (SECL), approved the buyback of 8.46 lakh fully paid equity shares of face value of Rs 1000 each from the members of the company on a proportionate basis through tender offer representing 23.53% of the total number of equity shares in the paid-up share capital of the company. The shares will be bought back for an aggregate amount not exceeding Rs 1200.19 crore with maximum buyback size being upto 25% of the paid-up equity share capital and free reserves as on financial year ended 31 March 2016, at a buyback price of Rs 14,180.57 per share payable in cash.
Wipro rose 0.86%. The company announced the launch of its analytics solution, Data Discovery Platform. The solution provides pertinent business insights across the value chain of an industry through the predefined “apps”. The platform will enable businesses to embark on an analytics journey with value added services of process simplification and business transformation. The announcement was made after market hours today, 15 June 2016.
Key indices snapped four-day losing streak today, 15 June 2016. The Sensex had declined 624.95 points or 2.31% to settle at 26,395.71 on 14 June 2016 in four sessions from its close of 27,020.66 on 8 June 2016. The Sensex has risen 58.38 points or 0.21% in this month so far (till 15 June 2016). The Sensex has risen 608.80 points or 2.33% in calendar year 2016 so far (till 15 June 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 4,231.73 points or 18.81%. The Sensex is off 1,851.99 points or 6.48% from a 52-week high of 28,578.33 hit on 23 July 2015. The Sensex is off 3,298.40 points 10.98% from a record high of 30,024.74 hit on 4 March 2015.
The Sensex gained 330.63 points or 1.25% to settle at 26,726.34, its highest closing level since 9 June 2016. The index rose 356.88 points or 1.35% at the day's high of 26,752.59. The index rose 50.88 points or 0.19% at the day's low of 26,446.59.
The Nifty 50 index gained 97.75 points or 1.21% to settle at 8,206.60, its highest closing level since 8 June 2016. The index gained 104.35 points or 1.29% at the day's high of 8,213.20. The index rose 14.30 points or 0.18% at the day's high of 8,123.15.
Goods and Services Tax (GST), the biggest tax reform of the country, is likely to be implemented sooner than expected, reports quoting Finance Minister Arun Jaitley indicated. After attending a meeting of finance ministers of 22 states in Kolkata yesterday, 14 June 2016, Jaitley reportedly said that all states except Tamil Nadu have agreed on the broader contours of GST. The meeting has agreed that issues of dual control and revenue neutral rate should be dealt by the Empowered Committee and not to cap the GST rate in the Bill.
In overseas markets, European stocks edged higher, snapping a five-day losing streak, as miners and retailers advanced, while traders awaited outcome of the Federal Reserve's latest policy review. Exports from the eurozone to the rest of the world jumped in April, pushing its trade surplus wider and indicating that the currency area's modest recovery remained on track as the second quarter got underway. On a seasonally adjusted basis, exports rose by 4.9% from March, while imports rose by 2.6%, while the trade surplus widened to EUR28 billion in April from EUR23.7 billion in March.
Chinese mainland markets rose, shrugging off a decision by stock index provider MSCI saying yesterday, 14 June 2016 to delay inclusion of mainland-traded Chinese A shares in its key emerging market index. In mainland China, the Shanghai Composite index closed 1.58% higher. In Hong Kong, the Hang Seng index closed 0.39% higher. In Japan, the Nikkei 225 index settled 0.38% higher. Other Asian stocks were trading mixed as investors awaited outcome of the central bank meetings in the US and Japan. The US Federal Open Market Committee concludes its two-day meeting today, 15 June 2016 while the Bank of Japan will start its two-day meeting today, 15 June 2016. The Federal Reserve is expected to keep interest rates unchanged and signal if it still plans to raise rates twice in 2016 amid concerns about a US hiring slowdown and Britain's possible exit from the European Union.
Closer home, the market breadth indicating the overall health of the market was strong. On BSE, 1,674 shares gained and 954 shares declined. A total of 176 shares were unchanged. The BSE Mid-Cap index rose 0.58%. The BSE Small-Cap index gained 0.8%. Both these indices underperformed the Sensex.
All the nineteen sectoral indices on BSE were in the green. The S&P BSE Utilities index (up 2.06%), the S&P BSE Power index (up 1.99%), the S&P BSE Bankex (up 1.38%), the S&P BSE Industrials index (up 1.31%), and the S&P BSE Capital Goods index (up 2.26%) outperformed the Sensex.
The S&P BSE Realty index (up 0.34%), the S&P BSE Consumer Durables index (up 0.09%), the S&P BSE Telecom index (up 0.85%), the S&P BSE Metal index (up 0.79%), the S&P BSE Finance index (up 1.16%), the S&P BSE Auto index (up 0.84%), the S&P BSE Healthcare index (up 0.15%), the S&P BSE FMCG index (up 0.94%), the S&P BSE Energy index (up 0.84%), the S&P BSE Oil & Gas index (up 1.14%), the S&P BSE Basic Materials index (up 1.15%), the S&P BSE Consumer Discretionary Goods & Services index (up 0.93%), the S&P BSE Teck index (up 0.94%) and the S&P BSE IT index (up 0.91%) underperformed the Sensex.
The total turnover on BSE amounted to Rs 2936.15 crore, higher than turnover of Rs 2733.26 crore registered during the previous trading session.
Index heavyweight and cigarette major ITC rose 1.75% to Rs 359.50. The stock hit a high of Rs 360 and low of Rs 353.65 in intraday trade.
Capital goods stocks edged higher. ABB India (up 1.5%), Bharat Electronics (up 1.14%), Crompton Greaves (up 3.32%), Siemens (up 1.11%), and Thermax (up 0.46%) gained. BEML fell 0.35%.
Index heavyweight and engineering and construction major L&T advanced 3.32% to Rs 1,509. The stock hit high of Rs 1,512.50 and low of Rs 1,461.10 in intraday trade.
Bharat Heavy Electricals (Bhel) rose 0.82% after the company said that continuing project commissioning momentum, it has successfully commissioned another 195 megawatts (MW) thermal unit in Bihar. This is the second 195 MW unit to be commissioned by Bhel at Muzaffarpur Thermal Power Station (TPS) Stage-II of Kanti Bijlee Utpadan Nigam (KBUNL), a joint venture of NTPC and BSPGCL, in Bihar. The first 195 MW unit at Muzaffarpur TPS Stage-II was commissioned earlier by the company in March 2015, Bhel said.
Bank stocks gained. Among public sector banks, Punjab National Bank (up 1.01%), Bank of Baroda (up 1.98%), Union Bank of India (up 1.89%), Canara Bank (up 1.07%), and Bank of India (up 1%) edged higher.
Shares of State Bank of India (SBI) and its associate banks spurted on reports that the Union Cabinet may approve the proposed merger of associate banks with SBI today, 15 June 2016. State Bank of Mysore (up 20%), State Bank of Travancore (up 20%), State Bank of Bikaner and Jaipur (up 20%) and State Bank of India (up 3.9%) edged higher.
Earlier on 17 May 2016, State Bank of India (SBI) announced that it is seeking in principle sanction of the Government of India (GoI) to enter into negotiation with its 5 subsidiary banks viz. State Bank of Bikaner and Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala and State Bank of Travancore to acquire their businesses including assets and liabilities. The decision is purely exploratory at this stage and there is no certainty in relation to SBI completing the acquisitions, SBI said. SBI's board of directors will take a final call after evaluating all the relevant considerations. SBI also said that it is considering acquisition of the newly-created Bharatiya Mahila Bank.
In May 2016, government officials were quoted by the media as saying that no legislative changes will be required for SBI merger and that the process may get completed within this fiscal. SBI Chairman Arundhati Bhattacharya had told the media that the benefits of merger would be huge and one of them will be 100 basis points reduction in lending cost within a year post this merger.
Brokerages, which see merger a positive development, had reportedly said employee integration and their cost will be the key to watch out for when the merger will take place. According to brokerages, the merger is long term positive for SBI, but financially it may be negative in the near term due to higher retirement cost, reports said.
While explaining the importance of staff cost, a foreign brokerage reportedly highlighted earlier merger of SBI. In its note, the brokerage reportedly said that SBI had to make additional employee provisions in the case of merger with its subsidiaries historically. This was due to likely rationalization of pay scales, and higher retirement related benefits. Currently SBI subsidiaries get only two retirement related benefits versus three at SBI (pension, provident fund and gratuity), reports suggested.
Among private sector banks, HDFC Bank (up 1.25%), ICICI Bank (up 1.22%), Kotak Mahindra Bank (up 2.09%), Yes Bank (up 0.49%), and IndusInd Bank (up 0.59%) edged higher. Axis Bank declined 0.35%.
Shares of power generation and power distribution companies gained. NTPC (up 3.88%), Torrent Power (up 3.74%), Adani Power (up 0.17%), Power Grid Corporation of India (up 2.52%), and Reliance Power (up 0.38%) gained. NHPC (down 0.4%) and Reliance Infrastructure (down 0.75%) declined.
Tata Power Company gained 0.99%. The company announced that Tata Power Renewable Energy (TPREL), a wholly owned subsidiary of the company successfully issued and allotted guaranteed, unsecured, non-cumulative, redeemable, taxable, listed, rated non-convertible debentures of Rs 575 crore on private placement basis. The announcement was made after market hours today, 15 June 2016. The NCDs will carry a spread of 0.14% above 6 month marginal cost of lending rate (MCLR) of HDFC Bank payable semi annually and are guaranteed by the company. The proceeds from the NCDs will be primarily used to prepay existing higher cost debt in TPREL. The guarantee agreement has been entered to guarantee payment obligation of TPREL pursuant to the NCDs. The guarantee is capped at Rs 625 crore and will fall off once the NCDs are fully repaid. This will create contingent liability not exceeding Rs 625 crore for the company.
Coal India rose 0.29% after the company announced after market hours yesterday, 14 June 2016, that the board of directors of its subsidiary, South Eastern Coalfields (SECL), approved the buyback of 8.46 lakh fully paid equity shares of face value of Rs 1000 each from the members of the company on a proportionate basis through tender offer representing 23.53% of the total number of equity shares in the paid-up share capital of the company. The shares will be bought back for an aggregate amount not exceeding Rs 1200.19 crore with maximum buyback size being upto 25% of the paid-up equity share capital and free reserves as on financial year ended 31 March 2016, at a buyback price of Rs 14,180.57 per share payable in cash.
Wipro rose 0.86%. The company announced the launch of its analytics solution, Data Discovery Platform. The solution provides pertinent business insights across the value chain of an industry through the predefined “apps”. The platform will enable businesses to embark on an analytics journey with value added services of process simplification and business transformation. The announcement was made after market hours today, 15 June 2016.
Key indices snapped four-day losing streak today, 15 June 2016. The Sensex had declined 624.95 points or 2.31% to settle at 26,395.71 on 14 June 2016 in four sessions from its close of 27,020.66 on 8 June 2016. The Sensex has risen 58.38 points or 0.21% in this month so far (till 15 June 2016). The Sensex has risen 608.80 points or 2.33% in calendar year 2016 so far (till 15 June 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 4,231.73 points or 18.81%. The Sensex is off 1,851.99 points or 6.48% from a 52-week high of 28,578.33 hit on 23 July 2015. The Sensex is off 3,298.40 points 10.98% from a record high of 30,024.74 hit on 4 March 2015.
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