Sensex settles at lowest closing level in more than 3 weeks
Losses in auto, capital goods, FMCG sector stocks and index heavyweights Reliance Industries, HDFC and ITC led losses for key benchmark indices. The barometer index, the S&P BSE Sensex lost 284.20 points or 1.02% to settle at 27,697.51. The losses for the Nifty 50 index were lower in percentage terms than those for the Sensex. The Nifty dropped 78.05 points or 0.91% to settle at 8,544.85. The Sensex closed below the psychologically important 28,000 level. It had briefly crossed that level at the onset of trading session. The Sensex hit its lowest closing level in more than three weeks. The Nifty hit its lowest closing level in nearly two weeks. Key indices extended intraday losses in late trade. Weakness in global stocks weighed on sentiment on the domestic bourses.
The Sensex and the Nifty declined for the fourth straight trading session.
Bank stocks declined. HCL Technologies edged higher after the company reported a marginal rise in its bottom line in Q1 June 2016 over Q4 March 2016. Titan Company edged lower after the company reported weak Q1 June 2016 results.
In overseas stock markets, European and Asian markets edged lower after US stocks took their biggest loss in almost a month yesterday, 2 August 2016, underscoring simmering worries about global economic growth. Meanwhile, growth in China's services sector cooled in July, a private survey showed today, 3 August 2016. The Caixin/Markit services purchasing managers' index (PMI) fell to 51.7 in July on a seasonally adjusted basis, from an 11-month peak of 52.7 in June. US stocks fell yesterday, 2 August 2016 on the back of disappointing auto sales and a steep drop for retailers on forecasts of poor summer sales.
The Sensex lost 284.20 points or 1.02% to settle at 27,697.51, its lowest closing level since 11 July 2016. The index rose 33.72 points or 0.12% at the day's high of 28,015.43. The index fell 334.57 points or 1.19% at the day's low of 27,647.14.
The Nifty shed 78.05 points or 0.91% to settle at 8,544.85, its lowest closing level since 22 July 2016. The index rose 12.55 points or 0.14% at the day's high of 8,635.45.
The index declined 93.30 points or 1.08% at the day's low of 8,529.60.
The BSE Mid-Cap index fell 1.5%. The BSE Small-Cap index shed 1.14%. The decline in both these indices was higher than the Sensex's decline in percentage terms.
The broad market depicted weakness. There were almost two losers against every gainer on BSE. 1,825 shares fell and 906 shares rose. A total of 141 shares were unchanged.
The total turnover on BSE amounted to Rs 3251 crore, lower than turnover of Rs 3723.50 crore registered during the previous trading session.
Among the sectoral indices on BSE, the S&P BSE FMCG index (down 2.04%), the BSE Auto index (down 1.7%), the BSE Capital Goods index (down 1.74%), the BSE Power index (down 1.71%) and the BSE Realty index (down 2.15%) underperformed the Sensex. The BSE Healthcare index (down 0.21%), the BSE IT index (down 0.19%), the BSE Bankex index (down 0.61%) and the BSE Metal index (up 0.07%) outperformed the Sensex.
Index heavyweight and housing finance major HDFC lost 1.24% at Rs 1,325.25. The stock hit a high of Rs 1,342.10 and a low of Rs 1,317 in intraday trade.
Index heavyweight and cigarette major ITC shed 2.86% at Rs 252.75. The stock hit a high of Rs 260.35 and a low of Rs 251.35 in intraday trade.
Index heavyweight Reliance Industries (RIL) shed 1.68% at Rs 994.05. The stock hit high of Rs 1,013.05 and low of Rs 992 in intraday trade.
Bank stocks declined. Among public sector banks, Bank of Baroda (down 1.52%), Punjab National Bank (dwon 1.1%), IDBI Bank (down 0.58%), Bank of India (down 0.77%) and State Bank of India (down 0.57%) edged lower. Union Bank of India (up 1.43%) and Corporation Bank (up 0.25%) edged higher.
Indian Bank fell 3.49%, with the stock sliding on profit booking after surging by the maximum permissible 20% level yesterday, 2 August 2016. Shares of Indian Bank surged 20% to settle at Rs 186.20 yesterday, 2 August 2016, after the bank announced surge in bottom line in Q1 June 2016. Indian Bank's net profit rose 42.77% to Rs 307.36 crore on 0.4% rise in total income to Rs 4512.96 crore in Q1 June 2016 over Q1 June 2015. The result was announced during trading hours yesterday, 2 August 2016.
The bank's provisions and contingencies (excluding tax provisions) rose 2.2% to Rs 416.99 crore in Q1 June 2016 over Q1 June 2015. Provision coverage ratio stood at 53.89% as on 30 June 2016.
The bank's gross non-performing assets (NPAs) stood at Rs 8894.24 crore as on 30 June 2016 as against Rs 8827.04 crore as on 31 March 2016 and Rs 5815.15 crore as on 30 June 2015. The ratio of gross NPA to gross advances stood at 6.97% as on 30 June 2016 as against 6.66% as on 31 March 2016 and 4.65% as on 30 June 2015. The ratio of net NPA to net advances stood at 4.48% as on 30 June 2016 as against 4.2% as on 31 March 2016 and 2.62% as on 30 June 2015.
Meanwhile, Indian Bank announced after market hours yesterday, 2 August 2016, that its board of directors approved raising upto Rs 1000 crore by issuing Basel III compliant AT 1 and/or Tier 2 bonds in one or more tranches in the current or subsequent years based on the requirement.
Among private sector banks, ICICI Bank (down 1.37%), IndusInd Bank (down 1.26%), Axis Bank (down 0.14%) and Kotak Mahindra Bank (down 0.17%) edged lower. Yes Bank (up 0.53%) edged higher.
Index heavyweight HDFC Bank was down 0.32%.
Capital goods stocks declined. Crompton Greaves (down 2.34%), Siemens (down 2.52%), Suzlon Energy (down 2.65%), BEML (down 2.5%), ABB India (down 2.7%), Havells India (down 2.73%), Praj Industries (down 1.61%), L&T (down 1.75%), GE T&D India (down 0.14%), Bharat Electronics (down 0.93%) and Thermax (down 0.36%) edged lower.
Bharat Heavy Electricals (Bhel) declined 4%. The company announced that it commissioned the second 500 megawatts (MW) thermal unit at Marwa Thermal Power Station in Chattisgarh. Marwa TPS has been set by Chattisgarh State Power Generation Company (CSPGCL). The first unit of Marwa TPS was also commissioned earlier by Bhel. The announcement was made during market hours today, 3 August 2016.
Auto stocks declined. Mahindra & Mahindra (M&M) (down 0.94%), Ashok Leyland (down 2.72%), Eicher Motors (down 2.56%), Bajaj Auto (down 1.4%), Hero MotoCorp (down 0.7%) and TVS Motor Company (down 0.7%) declined.
Maruti Suzuki India declined 2.32%. The company announced that it inaugurated “MyNEXA Cocierge” airport display and lounge for its customers at T3, Indira Gandhi International Airport, New Delhi. NEXA, the new automobile sales channel of the company, recently completed one year of operations in India. The announcement was made during market hours today, 3 August 2016.
Separately, Maruti Suzuki India said during market hours today, 3 August 2016 that production rose 2.58% to 1.36 lakh units in July 2016 over July 2015.
FMCG stocks edged lower. Colgate-Palmolive (India) (down 3.19%), Tata Global Beverages (down 1.84%), Britannia Industries (down 1.89%), Godrej Consumer Products (down 1.88%), Hindustan Unilever (down 1.47%), Dabur India (down 1.77%), Procter & Gamble Hygiene and Health Care (down 1.4%), GlaxoSmithkline Consumer Healthcare (down 0.64%), Marico (down 0.73%) and Nestle India (down 0.35%) declined. Emami (up 0.72%), Jyothy Laboratories (up 0.42%) and Bajaj Corp (up 0.79%) edged higher.
HCL Technologies rose 3.16% at Rs 825.90 after consolidated net profit rose 1.84% to Rs 2050.78 crore on 5.96% increase in total income from operations to Rs 11336.32 crore in Q1 June 2016 over Q4 March 2016. The result was announced before trading hours today, 3 August 2016. In an investor release, HCL Tech said that its consolidated net profit as per US Generally Accepted Accounting Principles (GAAP) rose 6.3% to Rs 2047 crore on 6% increase in revenue to Rs 11336 crore in Q1 June 2016 over Q4 March 2016. Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 6% to Rs 2521 crore in Q1 June 2016 over Q4 March 2016. EBITDA margin stood at 22.2% in Q1 June 2016, same as in Q4 March 2016.
The company has given a guidance of 12% to 14% growth in revenue in constant currency terms for the year ending 31 March 2017 (FY 2017). This is against revenue growth of 11.2% on year on year basis in constant currency terms achieved in Q1 June 2016. Revenue growth for trailing twelve months ended 30 June 2016 on year on year basis in constant currency terms stood at 10.7%. The constant currency guidance translates to 11.2% to 13.2% growth in revenue in US dollar terms for FY 2017 based on 30 June 2016 exchange rates.
In FY 2017, profit margin based on earnings before interest and tax is expected to be in the range of 19.5% to 20.5%.
Ambuja Cements was down 0.78%. Ambuja Cements has secured coal linkage of 20,400 tonnes at Rs 1,810 per tonne from Western Coalfields (Niljai colliery), 16,500 tonnes at Rs 1,095 per tonne from South Eastern Coalfields (Kusmunda siding) and 82,300 tonnes at Rs 1,070 per tonne from South Eastern Coalfields (Gevra siding). The announcement was made after market hours yesterday, 2 August 2016.
Ambuja Cements had late last month announced securing a linkage of 96,000 tonnes of coal at Rs 1,050 per tonne from Junadih siding of South Eastern Coalfields.
Titan Company fell 2.83% at Rs 411.30 after net profit declined 16.34% to Rs 126.69 crore on 3.15% rise in total income to Rs 2812.16 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours today, 3 August 2016.
Titan Company's bottom line in Q1 June 2016 was adversely impacted by a one-time exceptional expenditure of Rs 96.88 crore pertaining to voluntary retirement scheme for its employees announced during the quarter. The company's PBT (profit before tax) before extraordinary items rose 32.4% to Rs 270.64 crore in Q1 June 2016 over Q1 June 2015.
Titan Company said that the income from watches business rose 1.4% to Rs 491.72 crore in Q1 June 2016 over Q1 June 2015. Revenue from jewellery business rose 3.2% to Rs 2138.32 crore in Q1 June 2016 over Q1 June 2015. Revenue from the eyewear business rose 2.7% to Rs 109.87 crore in Q1 June 2016 over Q1 June 2015. Revenue from other businesses, including precision engineering business rose 36.2% to Rs 63.92 crore in Q1 June 2016 over Q1 June 2015.
Titan Company said that the company has put together plans to stimulate demand for all its product categories through innovative advertising campaigns and new product launches in the coming quarters. The company further said in its Q1 June 2016 results press release that the expansion of retail stores continued with a net addition of 11 stores across all its businesses in Q1 June 2016.
Commenting on the first quarter results, Bhaskar Bhat, Managing Director, Titan Company said that the Q1 June 2016 results have been good for the company from a bottom line perspective. The final number though, has been impacted adversely by an exceptional item, the benefits of which will accrue over the coming years, Bhat said. The wedding season in Q1 June 2016 was poor which impacted sales growth in both watches and jewellery, Bhat said.
The Sensex and the Nifty declined for the fourth straight trading session. The Sensex has declined 511.11 points or 1.81% in four trading sessions from its close of 28,208.62 on 28 July 2016. The Sensex has declined 354.35 points or 1.26% in August 2016 so far (till 3 August 2016). The Sensex has risen 1,579.97 points or 6.04% in calendar year 2016 so far (till 3 August 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 5,202.90 points or 23.12%. The Sensex is off 720.08 points or 2.53% from a 52-week high of 28,417.59 hit on 10 August 2015. The Sensex is off 2,327.23 points or 7.75% from a record high of 30,024.74 hit on 4 March 2015.
The outcome of a monthly survey showed that Indian service providers enjoyed a welcome upturn in demand during July, with a faster increase in new business underpinning stronger growth of output and boosting confidence. Part of the upswing in incoming new work was supported by price discounts. The seasonally adjusted Nikkei India Services Business Activity Index rose to 51.9 in July, posting above the no-change mark of 50 for the thirteenth month running, highlighting ongoing growth of output in the sector. Up from 50.3 in June, the headline index was at a three-month high and indicative of a modest rate of expansion.
Meanwhile, investors are awaiting the progress on the Goods and Services Tax (GST) constitutional amendment bill in parliament. According to reports, the debate on the long-pending GST Bill has started after the bill was tabled in the Rajya Sabha today, 3 August 2016 amidst strong indications that the most far-reaching taxation reform would be supported by Congress and all other major political parties. The government is keen to get the GST Bill approved during the Monsoon Session of Parliament ending on 12 August 2016.
The GST bill, which has been approved by the Lok Sabha, is pending in the Rajya Sabha because of opposition to the bill in its current form by the Congress party. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax.
Meanwhile, the India Meteorological Department (IMD) said that this year the Southwest monsoon rainfall was 11% below the Long Period Average (LPA) during June, however, July rainfall has been 7% above the LPA. The rainfall data was released yesterday, 2 August 2016. Rainfall over the country as a whole during second half of southwest monsoon season from August to September is most likely to be above normal that is more than 106% of LPA with a probability of 55%.
Quantitatively, the rainfall for the country as a whole during second half of the season is likely to be 107% of LPA with a model error of ±8%. The rainfall during August is likely to be 104 ± 9% of LPA as was forecasted in June. The rainfall in monsoon season from June to September over the country as a whole is likely to be 106% ±4% of LPA as was forecasted in June.
The Sensex and the Nifty declined for the fourth straight trading session.
Bank stocks declined. HCL Technologies edged higher after the company reported a marginal rise in its bottom line in Q1 June 2016 over Q4 March 2016. Titan Company edged lower after the company reported weak Q1 June 2016 results.
In overseas stock markets, European and Asian markets edged lower after US stocks took their biggest loss in almost a month yesterday, 2 August 2016, underscoring simmering worries about global economic growth. Meanwhile, growth in China's services sector cooled in July, a private survey showed today, 3 August 2016. The Caixin/Markit services purchasing managers' index (PMI) fell to 51.7 in July on a seasonally adjusted basis, from an 11-month peak of 52.7 in June. US stocks fell yesterday, 2 August 2016 on the back of disappointing auto sales and a steep drop for retailers on forecasts of poor summer sales.
The Sensex lost 284.20 points or 1.02% to settle at 27,697.51, its lowest closing level since 11 July 2016. The index rose 33.72 points or 0.12% at the day's high of 28,015.43. The index fell 334.57 points or 1.19% at the day's low of 27,647.14.
The Nifty shed 78.05 points or 0.91% to settle at 8,544.85, its lowest closing level since 22 July 2016. The index rose 12.55 points or 0.14% at the day's high of 8,635.45.
The index declined 93.30 points or 1.08% at the day's low of 8,529.60.
The BSE Mid-Cap index fell 1.5%. The BSE Small-Cap index shed 1.14%. The decline in both these indices was higher than the Sensex's decline in percentage terms.
The broad market depicted weakness. There were almost two losers against every gainer on BSE. 1,825 shares fell and 906 shares rose. A total of 141 shares were unchanged.
The total turnover on BSE amounted to Rs 3251 crore, lower than turnover of Rs 3723.50 crore registered during the previous trading session.
Among the sectoral indices on BSE, the S&P BSE FMCG index (down 2.04%), the BSE Auto index (down 1.7%), the BSE Capital Goods index (down 1.74%), the BSE Power index (down 1.71%) and the BSE Realty index (down 2.15%) underperformed the Sensex. The BSE Healthcare index (down 0.21%), the BSE IT index (down 0.19%), the BSE Bankex index (down 0.61%) and the BSE Metal index (up 0.07%) outperformed the Sensex.
Index heavyweight and housing finance major HDFC lost 1.24% at Rs 1,325.25. The stock hit a high of Rs 1,342.10 and a low of Rs 1,317 in intraday trade.
Index heavyweight and cigarette major ITC shed 2.86% at Rs 252.75. The stock hit a high of Rs 260.35 and a low of Rs 251.35 in intraday trade.
Index heavyweight Reliance Industries (RIL) shed 1.68% at Rs 994.05. The stock hit high of Rs 1,013.05 and low of Rs 992 in intraday trade.
Bank stocks declined. Among public sector banks, Bank of Baroda (down 1.52%), Punjab National Bank (dwon 1.1%), IDBI Bank (down 0.58%), Bank of India (down 0.77%) and State Bank of India (down 0.57%) edged lower. Union Bank of India (up 1.43%) and Corporation Bank (up 0.25%) edged higher.
Indian Bank fell 3.49%, with the stock sliding on profit booking after surging by the maximum permissible 20% level yesterday, 2 August 2016. Shares of Indian Bank surged 20% to settle at Rs 186.20 yesterday, 2 August 2016, after the bank announced surge in bottom line in Q1 June 2016. Indian Bank's net profit rose 42.77% to Rs 307.36 crore on 0.4% rise in total income to Rs 4512.96 crore in Q1 June 2016 over Q1 June 2015. The result was announced during trading hours yesterday, 2 August 2016.
The bank's provisions and contingencies (excluding tax provisions) rose 2.2% to Rs 416.99 crore in Q1 June 2016 over Q1 June 2015. Provision coverage ratio stood at 53.89% as on 30 June 2016.
The bank's gross non-performing assets (NPAs) stood at Rs 8894.24 crore as on 30 June 2016 as against Rs 8827.04 crore as on 31 March 2016 and Rs 5815.15 crore as on 30 June 2015. The ratio of gross NPA to gross advances stood at 6.97% as on 30 June 2016 as against 6.66% as on 31 March 2016 and 4.65% as on 30 June 2015. The ratio of net NPA to net advances stood at 4.48% as on 30 June 2016 as against 4.2% as on 31 March 2016 and 2.62% as on 30 June 2015.
Meanwhile, Indian Bank announced after market hours yesterday, 2 August 2016, that its board of directors approved raising upto Rs 1000 crore by issuing Basel III compliant AT 1 and/or Tier 2 bonds in one or more tranches in the current or subsequent years based on the requirement.
Among private sector banks, ICICI Bank (down 1.37%), IndusInd Bank (down 1.26%), Axis Bank (down 0.14%) and Kotak Mahindra Bank (down 0.17%) edged lower. Yes Bank (up 0.53%) edged higher.
Index heavyweight HDFC Bank was down 0.32%.
Capital goods stocks declined. Crompton Greaves (down 2.34%), Siemens (down 2.52%), Suzlon Energy (down 2.65%), BEML (down 2.5%), ABB India (down 2.7%), Havells India (down 2.73%), Praj Industries (down 1.61%), L&T (down 1.75%), GE T&D India (down 0.14%), Bharat Electronics (down 0.93%) and Thermax (down 0.36%) edged lower.
Bharat Heavy Electricals (Bhel) declined 4%. The company announced that it commissioned the second 500 megawatts (MW) thermal unit at Marwa Thermal Power Station in Chattisgarh. Marwa TPS has been set by Chattisgarh State Power Generation Company (CSPGCL). The first unit of Marwa TPS was also commissioned earlier by Bhel. The announcement was made during market hours today, 3 August 2016.
Auto stocks declined. Mahindra & Mahindra (M&M) (down 0.94%), Ashok Leyland (down 2.72%), Eicher Motors (down 2.56%), Bajaj Auto (down 1.4%), Hero MotoCorp (down 0.7%) and TVS Motor Company (down 0.7%) declined.
Maruti Suzuki India declined 2.32%. The company announced that it inaugurated “MyNEXA Cocierge” airport display and lounge for its customers at T3, Indira Gandhi International Airport, New Delhi. NEXA, the new automobile sales channel of the company, recently completed one year of operations in India. The announcement was made during market hours today, 3 August 2016.
Separately, Maruti Suzuki India said during market hours today, 3 August 2016 that production rose 2.58% to 1.36 lakh units in July 2016 over July 2015.
FMCG stocks edged lower. Colgate-Palmolive (India) (down 3.19%), Tata Global Beverages (down 1.84%), Britannia Industries (down 1.89%), Godrej Consumer Products (down 1.88%), Hindustan Unilever (down 1.47%), Dabur India (down 1.77%), Procter & Gamble Hygiene and Health Care (down 1.4%), GlaxoSmithkline Consumer Healthcare (down 0.64%), Marico (down 0.73%) and Nestle India (down 0.35%) declined. Emami (up 0.72%), Jyothy Laboratories (up 0.42%) and Bajaj Corp (up 0.79%) edged higher.
HCL Technologies rose 3.16% at Rs 825.90 after consolidated net profit rose 1.84% to Rs 2050.78 crore on 5.96% increase in total income from operations to Rs 11336.32 crore in Q1 June 2016 over Q4 March 2016. The result was announced before trading hours today, 3 August 2016. In an investor release, HCL Tech said that its consolidated net profit as per US Generally Accepted Accounting Principles (GAAP) rose 6.3% to Rs 2047 crore on 6% increase in revenue to Rs 11336 crore in Q1 June 2016 over Q4 March 2016. Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 6% to Rs 2521 crore in Q1 June 2016 over Q4 March 2016. EBITDA margin stood at 22.2% in Q1 June 2016, same as in Q4 March 2016.
The company has given a guidance of 12% to 14% growth in revenue in constant currency terms for the year ending 31 March 2017 (FY 2017). This is against revenue growth of 11.2% on year on year basis in constant currency terms achieved in Q1 June 2016. Revenue growth for trailing twelve months ended 30 June 2016 on year on year basis in constant currency terms stood at 10.7%. The constant currency guidance translates to 11.2% to 13.2% growth in revenue in US dollar terms for FY 2017 based on 30 June 2016 exchange rates.
In FY 2017, profit margin based on earnings before interest and tax is expected to be in the range of 19.5% to 20.5%.
Ambuja Cements was down 0.78%. Ambuja Cements has secured coal linkage of 20,400 tonnes at Rs 1,810 per tonne from Western Coalfields (Niljai colliery), 16,500 tonnes at Rs 1,095 per tonne from South Eastern Coalfields (Kusmunda siding) and 82,300 tonnes at Rs 1,070 per tonne from South Eastern Coalfields (Gevra siding). The announcement was made after market hours yesterday, 2 August 2016.
Ambuja Cements had late last month announced securing a linkage of 96,000 tonnes of coal at Rs 1,050 per tonne from Junadih siding of South Eastern Coalfields.
Titan Company fell 2.83% at Rs 411.30 after net profit declined 16.34% to Rs 126.69 crore on 3.15% rise in total income to Rs 2812.16 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours today, 3 August 2016.
Titan Company's bottom line in Q1 June 2016 was adversely impacted by a one-time exceptional expenditure of Rs 96.88 crore pertaining to voluntary retirement scheme for its employees announced during the quarter. The company's PBT (profit before tax) before extraordinary items rose 32.4% to Rs 270.64 crore in Q1 June 2016 over Q1 June 2015.
Titan Company said that the income from watches business rose 1.4% to Rs 491.72 crore in Q1 June 2016 over Q1 June 2015. Revenue from jewellery business rose 3.2% to Rs 2138.32 crore in Q1 June 2016 over Q1 June 2015. Revenue from the eyewear business rose 2.7% to Rs 109.87 crore in Q1 June 2016 over Q1 June 2015. Revenue from other businesses, including precision engineering business rose 36.2% to Rs 63.92 crore in Q1 June 2016 over Q1 June 2015.
Titan Company said that the company has put together plans to stimulate demand for all its product categories through innovative advertising campaigns and new product launches in the coming quarters. The company further said in its Q1 June 2016 results press release that the expansion of retail stores continued with a net addition of 11 stores across all its businesses in Q1 June 2016.
Commenting on the first quarter results, Bhaskar Bhat, Managing Director, Titan Company said that the Q1 June 2016 results have been good for the company from a bottom line perspective. The final number though, has been impacted adversely by an exceptional item, the benefits of which will accrue over the coming years, Bhat said. The wedding season in Q1 June 2016 was poor which impacted sales growth in both watches and jewellery, Bhat said.
The Sensex and the Nifty declined for the fourth straight trading session. The Sensex has declined 511.11 points or 1.81% in four trading sessions from its close of 28,208.62 on 28 July 2016. The Sensex has declined 354.35 points or 1.26% in August 2016 so far (till 3 August 2016). The Sensex has risen 1,579.97 points or 6.04% in calendar year 2016 so far (till 3 August 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 5,202.90 points or 23.12%. The Sensex is off 720.08 points or 2.53% from a 52-week high of 28,417.59 hit on 10 August 2015. The Sensex is off 2,327.23 points or 7.75% from a record high of 30,024.74 hit on 4 March 2015.
The outcome of a monthly survey showed that Indian service providers enjoyed a welcome upturn in demand during July, with a faster increase in new business underpinning stronger growth of output and boosting confidence. Part of the upswing in incoming new work was supported by price discounts. The seasonally adjusted Nikkei India Services Business Activity Index rose to 51.9 in July, posting above the no-change mark of 50 for the thirteenth month running, highlighting ongoing growth of output in the sector. Up from 50.3 in June, the headline index was at a three-month high and indicative of a modest rate of expansion.
Meanwhile, investors are awaiting the progress on the Goods and Services Tax (GST) constitutional amendment bill in parliament. According to reports, the debate on the long-pending GST Bill has started after the bill was tabled in the Rajya Sabha today, 3 August 2016 amidst strong indications that the most far-reaching taxation reform would be supported by Congress and all other major political parties. The government is keen to get the GST Bill approved during the Monsoon Session of Parliament ending on 12 August 2016.
The GST bill, which has been approved by the Lok Sabha, is pending in the Rajya Sabha because of opposition to the bill in its current form by the Congress party. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax.
Meanwhile, the India Meteorological Department (IMD) said that this year the Southwest monsoon rainfall was 11% below the Long Period Average (LPA) during June, however, July rainfall has been 7% above the LPA. The rainfall data was released yesterday, 2 August 2016. Rainfall over the country as a whole during second half of southwest monsoon season from August to September is most likely to be above normal that is more than 106% of LPA with a probability of 55%.
Quantitatively, the rainfall for the country as a whole during second half of the season is likely to be 107% of LPA with a model error of ±8%. The rainfall during August is likely to be 104 ± 9% of LPA as was forecasted in June. The rainfall in monsoon season from June to September over the country as a whole is likely to be 106% ±4% of LPA as was forecasted in June.
No comments:
Post a Comment