Key benchmark indices extended gains and hit fresh intraday high in mid-afternoon trade. At 14:25 IST, the barometer index, the S&P BSE Sensex, was up 247.56 points or 0.82% at 30,569.68. The Nifty 50 index was up 65.65 points or 0.7% at 9,511.05. Both the Sensex and the Nifty hit record high levels in early trade.
Reports indicating that retirement fund manager Employees' Provident Fund Organization (EPFO) will invest at least Rs 18000 crore in stocks in the current financial year ending 31 March 2018 (FY 2018) boosted sentiment. Labour minister Bandaru Dattatreya was quoted as saying yesterday, 15 May 2017 that his ministry is positive on more equity exposure because of the encouraging returns it has received over the last one-and-a-half years.
EPFO started investing in stocks in August 2015. In FY 2016, it invested 5% of the annual ncremental corpus in equities and in FY 2017, 10%. EPFO has an annual incremental corpus of more than Rs 1.2 trillion and 15% of that will be at least Rs18000 crore, reports indicated. The decision on this is likely to be taken by central board of trustees (CBT) of the EPFO in its meeting on 27 May 2017.
After a gap-up opening on positive Asian cues, indices trimmed gains in morning trade as stocks took a breather after an initial upmove. The market held firm and hovered in positive zone in a small range till afternoon trade.
The market breadth, indicating the overall health of the market, was positive. On the BSE, 1,389 shares rose and 1,285 shares fell. A total of 191 shares were unchanged.
Pharma stocks saw mixed trend. Dr Reddy's Laboratories (up 1.88%), Glenmark Pharmaceuticals (up 0.52%), Lupin (up 0.6%), Cadila Healthcare (up 0.01%), GlaxoSmithKline Pharmaceuticals (up 0.06%), and Wockhardt (up 0.61%) rose. Cipla (down 0.16%), Sun Pharmaceutical Industries (down 0.09%), Alkem Laboratories (down 0.26%), Aurobindo Pharma (down 0.02%) fell.
Many power generation stocks rose. Reliance Infrastructure (up 0.89%), Tata Power Company (up 0.78%), NTPC (up 0.16%), Torrent Power (up 0.12%), Reliance Power (up 1.18%) and JSW Energy (up 0.07%) edged higher. CESC (down 0.3%), NHPC (down 0.96%), Jaiprakash Power Ventures (down 0.43%) fell.
Adani Power rose 7.26% on reports the electricity regulator has granted the company full compensation for the rise in the cost of electricity generation at its thermal power plant at Mundra, Gujarat.
According to reports, the Central Electricity Regulatory Authority (CERC) has granted Adani Power full compensation for the rise in the cost of electricity generation at its 4,620-megawatts (MW) thermal power plant at Mundra, Gujarat due to increased domestic levies on imported coal.
The regulator's decision comes after the Supreme Court ruling on 11 April 2017 that said power firms cannot get relief for any adverse fallout from policy changes effected by a foreign government, but expanded the scope of reliefs under the change in law provision in the domestic context.
Vindhya Telelinks surged 9.51% after net profit rose 15.3% to Rs 23.55 crore on 25.7% increase in net sales to Rs 372.50 crore in Q4 March 2017 over Q4 March 2016. The result was announced after market hours yesterday, 15 May 2017.
Meanwhile, in a separate announcement after market hours yesterday, 15 May 2017, the company said that its board approved a proposal for substantial expansion-cum-diversification of the company's existing copper cable facility at Rewa, to be executed in stages, for manufacturing of electron beam irradiated cross-linked cables including installation of electron beam accelerator(s) of appropriate rated capacity, with an estimated capital outlay of Rs 32.75 crore, to be funded by a mix of internal accruals and debt.
Amrit Corp was locked at 20% upper circuit at Rs 738 after net profit spurted 198.4% to Rs 3.73 crore on 23.9% increase in net sales to Rs 12.07 crore in Q4 March 2017 over Q4 March 2016. The result was announced after market hours yesterday, 15 May 2017.
Meanwhile, India's monsoon rains are reportedly expected to arrive on the southern Kerala coast on 30 May 2017, two days ahead of schedule. India looks likely to receive higher monsoon rainfall than previously forecast as concern over the El Nino weather condition has eased, K.J. Ramesh, director general of the state-run India Meteorological Department had reportedly said last week.
On the macro front, India's merchandise exports grew in double digits in dollar terms for the third consecutive month in April. Data released by the government yesterday, 15 May 2017 showed that exports grew 19.77% in April to $24.63 billion while imports rose 49.07% to $37.88 billion, leaving a trade gap of $13.24 billion.
Overseas, European and Asian stocks traded on a mixed note. In US, the S&P 500 and the Nasdaq Composite closed at fresh records yesterday, 15 May 2017 as a jump in oil prices to a two-week high lifted Wall Street sentiment. Crude rose for a fifth day, topping $49 a barrel, after Saudi Arabia and Russia supported an extension of output cuts.
The Dow Jones Industrial Average rose 85.33 points, or 0.4%, to close at 20,981.94. The S&P 500 index added 11.42 points, or 0.5%, to finish at 2,402.32. The Nasdaq Composite Index gained 28.44 points, or 0.5%, to end at 6,149.67.
In economic data, a gauge of New York-area manufacturing slumped into negative territory for the first time since the presidential election. The Empire State manufacturing index for May fell to negative 1, from positive 5.2 in April. Separately, sentiment among home builders rebounded in May, buoyed by optimistic views of demand for housing.
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