Domestic barometers advanced for a second consecutive trading session on Friday, amid media reports that the government may exempt the tax surcharge on foreign portfolio investors (FPIs). HDFC twins and ICICI Bank were the biggest contributors to the rise. Auto shares were in demand.
Domestic stock markets will remain shut on Monday, 12 August 2019 on account of Bakri Id and on Thursday, 15 August 2019 on account of Independence Day.
The Sensex rose 254.55 points or 0.68% to settle at 37,581.91. The index rose 480.19 points, or 1.29% at the day`s high of 37,807.55. The index rose 78.90 points, or 0.21% at the day`s low of 37,406.26.
The Nifty 50 index rose 77.20 points or 0.70% to settle at 11,109.65. The index rose 149 points, or 1.35% at the day`s high of 11,181.45. The index rose 30.35 points, or 0.28% at the day`s low of 11,062.80.
Broader markets strengthened. In the broader market, the S&P BSE Mid-Cap index rose 0.77%. The S&P BSE Small-Cap index gained 1%.
The market breadth, indicating the overall health of the market, was positive. On the BSE, 1545 shares rose and 950 shares fell. A total of 161 shares were unchanged.
Among the sectoral indices on the BSE, the S&P BSE Auto index (up 1.99%), the S&P BSE Finance index (up 1.41%) and the S&P BSE Consumer Durables index (up 1.39%) outperformed the S&P BSE Sensex. Meanwhile, the S&P BSE Metal index (down 0.83%), the S&P BSE Teck index (down 0.36%) and the S&P BSE Telecom index (down 0.34%) underperformed the S&P BSE Sensex.
Media reports on Thursday suggested that 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.
HDFC rose 1.41% to Rs 2211.90. HDFC Bank rose 2.07% to Rs 2281.75. ICICI Bank rose 1.40% to Rs 420.40.
Index pivotal ITC fell 1.36% to Rs 254.25.
BPCL rose 0.98% ahead of its Q1 June 2019 result today.
Yes Bank slumped 7.91% to Rs 82.10. The bank announced opening of the qualified institutional placement issue at a floor price of Rs 87.90 per equity share. The announcement was made after market hours yesterday, 8 August 2019.
The capital raising committee of the bank`s board of directors on Thursday authorised the opening of the issue on 8 August, Yes Bank said. The committee approved the floor price for the issue being Rs 87.90 per equity share and the committee may, at its discretion, offer a discount of not more than 5% on the floor price, it further added.
Yes Bank said in a notice to exchanges that a committee will meet on 14 August to consider and approve the issue price and final discount.
Among other private sector banks, RBL Bank (up 4.59%), Kotak Mahindra Bank (up 1.91%), City Union Bank (up 1.21%), Federal Bank (up 0.63%) and Axis Bank (up 0.29%) advanced. IndusInd Bank fell 0.08%.
Public sector banks were mixed. IDBI Bank (down 1.26%), UCO Bank (down 1.23%), Bank of India (down 1.16%), Andhra Bank (down 1%), State Bank of India (down 1%), United Bank of India (down 0.84%), Central Bank of India (down 0.5%), Allahabad Bank (down 0.27%) and Bank of Baroda (down 0.2%) edged lower. Canara Bank (up 0.18%), Indian Bank (up 0.18 %), Syndicate Bank (up 0.31%), Corporation Bank (up 0.49%), Union Bank of India (up 0.62%) and Bank of Maharashtra (up 0.74%), edged higher.
Most auto stocks rose. Eicher Motors (up 4.63%), Maruti Suzuki India (up 3.36%), TVS Motor Company (up 2.55%), Hero MotoCorp (up 1.34%), Ashok Leyland (up 1.26%), Escorts (up 1.13%) and Bajaj Auto (up 0.05%) advanced. Tata Motors fell 1.53%.
Mahindra & Mahindra rose 1.14%. The company said it will observe ``no production days`` for 8 - 14 days in various plants of the company and MVML during the second quarter of the financial year 2019-2020 to align its production with sales requirements. The management does not envisage any adverse impact on availability of vehicles in the market due to adequacy of vehicle stocks to serve the market requirements.
Bharat Heavy Electricals fell 2.15%. On a consolidated basis, the state-run company reported net loss of Rs 217.72 crore in Q1 June 2019 compared with net profit of Rs 40.69 crore in Q1 June 2018. Total income from operations fell 23.72% to Rs 4532.48 crore in Q1 June 2019 over Q1 June 2018. The result was announced after trading hours today.
Hindalco Industries fell 2.73%. The company`s consolidated net profit fell 27.93% to Rs 1,063 crore on 3.56% decline in revenue from operations to Rs 29,972 crore in Q1 June 2019 over Q1 June 2018. The result was announced during trading hours today.
Mahanagar Gas fell 4.42%. The company`s net profit rose 32.66% to Rs 170.24 crore on 22.31% rise in net sales to Rs 757.49 crore in Q1 June 2019 over Q1 June 2018. The announcement was made after market hours yesterday, 8 August 2019.
NBCC (India) slumped 12.61%. The company`s consolidated net profit fell 37.9% to Rs 51.46 crore on 15.85% fall in total income to Rs 1942.28 crore in Q1 June 2019 over Q1 June 2018. The announcement was made after market hours yesterday, 8 August 2019.
Page Industries dropped 4.33%. The company`s net profit fell 11.07% to Rs 110.67 crore on 2.19% rise in total income to Rs 840.46 crore in Q1 June 2019 over Q1 June 2018. The announcement was made after market hours yesteday, 8 August 2019.
Hexaware Technologies lost 1.48%. On a consolidated basis, the company`s net profit rose 19.07% to Rs 164.89 crore on a 3.51% rise in the net sales to Rs 1308.34 crore in Q2 June 2019 over Q1 March 2019. The result was announced after market hours yesterday, 8 August 2019.
Adani Transmission gained 2.13%. On a consolidated basis, the private transmission company`s net profit rose 26% to Rs 213.42 crore on a 360.5% rise in the net sales to Rs 2858.08 crore in Q1 June 2019 over Q1 June 2018. The result was announced after market hours yesterday, 8 August 2019.
Earnings before interest tax depreciation and amortization (EBITDA) grew 20.57% to Rs 592 crore in Q1 June 2019 as compared to Rs 491 crore in Q1 June 2018. The company`s net debt dropped 4.49% to Rs 1871 crore in Q1 June 2019 as compared to Rs 1959 crore in Q4 March 2018.
Rashtriya Chemicals & Fertilizers lost 1.73%. On a consolidated basis, the fertilizer producer`s net profit fell 65.3% to Rs 7.98 crore on a 24% rise in the net sales to Rs 2409.48 crore in Q1 June 2019 over Q1 June 2018. The result was announced after market hours yesterday, 8 August 2019.
Clariant Chemicals (India) jumped 15.26%. The specialty chemicals manufacturing company`s net profit rose 16.9% to Rs 11.27 crore on a 11.9% rise in the net sales to Rs 295.81 crore in Q1 June 2019 over Q1 June 2018. The result was announced after market hours yesterday, 8 August 2019.
Engineers India rose 3.07%. On a consolidated basis, the engineering consultancy company`s net profit rose 40.5% to Rs 125.73 crore on a 27.4% rise in the net sales to Rs 742.66 crore in Q1 June 2019 over Q1 June 2018. The result was announced after market hours yesterday, 8 August 2019.
Endurance Technologies jumped 14.20%. The company has reconsidered the proposal for expansion into tyre manufacturing and decided not to pursue the aforementioned project. The announcement was made after market hours yesterday, 8 August 2019.
Vodafone Idea lost 4.80% to Rs 5.36. The telecom major informed that Care Ratings, has downgraded its rating on long term bank facilities and non-convertible debentures from CARE A+ (Negative) to CARE A (Negative). The announcement was made after market hours yesterday, 8 August 2019.
Marico rose 2.32%. The company announced further infusion in the equity capital in Revofit such that it eventually holds upto 37% stake in the company. The announcement was made after market hours yesterday, 8 August 2019.
Britannia Industries rose 0.32%. On a consolidated basis, the company`s net profit fell 2.78% to Rs 251.03 crore on a 5.93% rise in the net sales to Rs 2677.32 crore in Q1 June 2019 over Q1 June 2018. The result was announced during market hours today, 9 August 2019.
Indiabulls Housing Finance jumped 13.77% while Lakshmi Vilas Bank hit 5% upper circuit at Rs 40.85. Media reports suggested that Indiabulls founder Sameer Gehlaut has promised the Reserve Bank of India (RBI) that he will relinquish all control and rights, have no say in the management, and bring the promoter group shareholding below 10% in the proposed bank to be formed after the merger of Indiabulls Housing Finance with Lakshmi Vilas Bank (LVB).
Spicejet gained 1.47%. On a consolidated basis, the aviation company reported a net profit of Rs 262.89 crore in Q1 June 2019 against a net loss of Rs 35.58 crore in Q1 June 2018. The total revenue from operations rose 35% to Rs 3002.85 crore in Q1 June 2019 over Q1 June 2018. The result was announced during market hours today, 9 August 2019.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 70.7175, compared with its close of 70.69 during the previous trading session.
In the commodities market, Brent crude for October 2019 settlement was up 80 cents at $58.18 a barrel. The contract rose $1.15 or 2.05% to settle at $57.38 a barrel during the previous trading session.
Overseas, European stocks were trading lower Friday as investors monitor a possible collapse of the Italian government. Italy`s coalition government imploded on Thursday, as deputy prime minister and leader of Italy`s ruling Lega party, Matteo Salvini, declared the arrangement unworkable and called for fresh general elections.
Official data showed that the British economy has shrunk for the first time since late 2012 after U.K. second quarter GDP (gross domestic product) contracted by 0.2%.
Brexit is again front and center as British Prime Minister Boris Johnson affirmed that the U.K. must leave the European Union on October 31 regardless of whether the government faced losing a vote of no-confidence.
Asian stocks ended mixed Friday after Chinese data revealed that food inflation soared in July, while Japan`s economy was shown to have grown more than expected in the second quarter.
US stocks advanced on Thursday with technology shares providing the biggest boost as equities continued to rebound along with bond yields.
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