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22nd July 2016
I had mentioned in last week’s
closing report that whether the bulls can take Nifty, Sensex higher is
questionable. The major indices of the Indian stock markets gave no clear
trend. While the bulls were trying to move the indices higher, there were market
corrections too. The indices have ended flat. The trends of the major indices
in the course of the week’s trading are given in the table below: The Total Investment & Insurance
Solutions
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Major Indices (The Total Investment & Insurance
Solutions)
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The benchmark indices opened higher
on Monday following firm global markets and expectations of the Goods and
Services Tax (GST) bill passing in the monsoon session of parliament and
expectations of better quarterly results which are to be announced later during
Monday. Selling pressure was witnessed in telecom, oil and gas and metal
stocks. Some movement was noticed in the state-owned banks, especially State
Bank of India's subsidiary banks. Expectations of the government's announcement
of the next round of capital infusion in state-run banks, for which Rs25,000
crore has been earmarked for the current fiscal boosted investors' sentiments.
On the NSE, there were 603 advances, 1007 declines and 55 unchanged. The Total Investment & Insurance
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Glenmark Pharmaceuticals Ltd is
planning to raise $200 million by issuing USD denominated non-convertible
unsecured bonds to repay existing debt, the company said on Monday.
"..subsequent to the rating received by the leading credit agencies in the
world that is Standard & Poor's and Fitch, the company has decided to tap
into the international bond market and is planning to raise around $200 million
by issuing USD denominated non-convertible unsecured bonds," the company
said in a filing to Bombay Stock Exchange. "The net proceeds will be used
for repaying the existing debt," it said. Glenmark shares closed at
Rs833.80, down 2.12%, on the BSE. The
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Profit booking, coupled with
disappointing quarterly results and negative global cues, depressed the Indian
equity markets on Tuesday. Consequently, the key indices traded on a
flat-to-negative note during the mid-afternoon session, as heavy selling
pressure was witnessed in fast moving consumer goods (FMCG), banking and
consumer durables stocks. On the NSE, there were 582 advances, 788 declines and
53 unchanged at the close of trading on Tuesday.
On Tuesday, the benchmark indices
opened on a flat note, in sync with their Asian peers. The equity markets soon
rose on the back of the government's decision to infuse capital into public sector
banks. In a statement, the Ministry of Finance announced a capital infusion of
Rs22,915 crore towards the recapitalisation of 13 public sector banks during
2016-17. However, the key indices ceded their gains, as profit booking,
disappointing quarterly results and weak global crude oil prices hampered the
upward trajectory. Besides, reduced chances of further monetary policy easing
by the European Central Bank (ECB) in its upcoming monetary policy review
dampened investors' sentiments. Nevertheless, value buying, healthy progress of
monsoon season and expectations of GST (Goods and Services Tax) getting passed
supported prices at the lower levels. Most of the banking and auto sector
stocks faced resistance at higher levels due to profit booking, while IT sector
stocks traded with mixed sentiments. The
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FMCG major Hindustan Unilever on
Monday said its net profit rose 10% to Rs1,174 crore in the quarter ended June,
as compared to Rs1,069 crore in the corresponding period last year. "Net
profit at Rs1,174 crore, was up 10%, aided by a one-time write back of
provision for pension benefits arising from plan amendments," the company
said in a statement. The company has proposed to make an investment of about
Rs1,000 crore towards the setting up of a new manufacturing unit in the
vicinity of its existing factory premises at Doom Dooma in Assam, it said. Net
sales from operations stood at Rs7,988 crore in the quarter under review as
compared to Rs7,713 crore in the same quarter last year. The new unit is
expected to be commissioned in early 2017 and will augment production capacity
of personal care products. HUL shares closed at Rs894.00, down 2.87% on the
BSE, on Tuesday.
Positive European indices and US
premarket futures buoyed the Indian equity markets on Wednesday, as healthy
buying was witnessed in healthcare, oil and gas, and capital goods stocks. On
the NSE, there were 965 advances, 448 declines and 61 unchanged at the close of
Wednesday’s trading.
The European Union (EU) downgraded
its economic outlook for Britain and the rest of the bloc on Tuesday, saying
the Brexit vote ushered in uncertainty and would weigh on growth. The gross
domestic product (GDP) growth in the 19-country eurozone is expected to slow to
between 1.3% and 1.5% in 2016 from the previously estimated 1.7% in May. The
same growth figures are expected for next year. This implies a loss of GDP of
0.25% to 0.5% by 2017, which is less than in Britain (1.0% to 2.75%), said a
report published by the European Commission, the bloc's executive arm. "The
UK's 'leave' vote is expected to slow private consumption and investment and
impact on foreign trade," it noted. The report warned that Britain's
referendum had created an "extraordinarily uncertain situation,"
which is likely to prevail for some time, and would affect not only Britain but
also the rest of the EU economy through several transmission channels, mainly
uncertainty, investment, trade, and migration. These issues are likely to have
a bearing on the investments by foreign institutional investors in emerging
markets like India.
On Thursday, the benchmark indices
opened on a positive note, in sync with their Asian peers, especially the
Japanese markets. Besides, the equity markets were pushed up by higher global
crude oil prices, firm rupee, healthy progress of monsoon season and recovery
in the European indices. However, the equity markets soon ceded their gains on
the back of sector-specific profit booking. In addition, reduced chances of
further monetary policy easing by the European Central Bank (ECB) in its
upcoming monetary policy review dampened investors' sentiments. Further, the
ongoing logjam in parliament hampered the upward trajectory in the stock
markets. Selling pressure was witnessed in banking, healthcare and capital
goods stocks. On the NSE, at the close of trading, there were 489 advances, 936
declines and 49 unchanged. The BSE market breadth was also tilted in favour of
the bears -- with 1,596 declines and 1,088 advances and 184 unchanged.
Positive domestic cues such as value
buying, short covering and a firm rupee lifted the Indian equity markets on
Friday. Consequently, the key indices traded in the green during the
late-afternoon session, as healthy buying was witnessed in capital goods,
metals and automobile stocks. Initially on Friday, the benchmark indices opened
on a flat-to-negative note, in sync with their Asian peers, especially the
Japanese markets. Besides, the equity markets were pulled down by lower global
crude oil prices, a logjam in parliament and negative European indices.
Furthermore, sector-specific profit booking on the back of quarterly results
hampered the upward trajectory. In addition, the European Central Bank (ECB)
decision to halt the easing of its monetary policy dampened investors'
sentiments. Overall, on Friday, the major indices closed with gains of upto
0.37% over Thursday’s close.The Total
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