Auto stocks extend gains

Key benchmark indices witnessed divergent trend in mid-morning trade. Indices hovered near the flat line. At 11:25 IST, the barometer index, the S&P BSE Sensex rose 32.85 points or 0.1% at 33,179.98. The Nifty 50 index lost 13.85 points or 0.14% at 10,329.20.

Indices edged higher and hit fresh record highs in early trade on firm Asian stocks. Market hovered in positive terrain will small gains in morning trade.

Among secondary indices, the S&P BSE Mid-Cap index rose 0.4%. The S&P BSE Small-Cap index gained 0.51%. Both the indices outperformed the Sensex.

The breadth, indicating the overall health of the market, was strong. On the BSE, 1,439 shares rose and 916 shares declined. A total of 125 shares were unchanged.

Auto stocks gained for the third straight day. Mahindra & Mahindra (M&M) (up 0.37%), Eicher Motors (up 0.9%), Bajaj Auto (up 0.58%), Hero MotoCorp (up 1.05%), Tata Motors (up 0.78%) gained. Ashok Leyland (down 1.22%) and TVS Motor Company (down 0.29%) declined.

Maruti Suzuki India rose 1.24% ahead of its Q2 results today, 27 October 2017.

Cement stocks were mixed. Ambuja Cements (up 0.96%), and ACC (up 0.12%) gained. Shree Cement (down 0.71%) and UltraTech Cement (down 0.34%) declined.

Grasim Industries advanced 0.86%. Grasim has exposure to the cement sector through its holding in UltraTech Cement.

Biocon lost 3% after consolidated net profit fell 53.10% to Rs 68.80 crore on 2.41% increase in net sales to Rs 968.60 crore in Q2 September 2017 over Q2 September 2016. The result was announced after market hours yesterday, 26 October 2017.

Commenting on the quarterly performance and highlights, chairperson and managing director Kiran Mazumdar-Shaw stated that while the company is pleased with the growth recovery of its research services (Syngene) and branded formulations business segments in the July - September quarter, its overall earnings performance was muted on account of several specific factors.

In particular, plant modifications undertaken to comply with regulatory requirements led to production disruptions. Additionally, the company experienced regulatory and tender delays in some emerging markets for its biosimilars business. Malaysia facility costs and pricing pressures in APIs business continue to weigh on its P&L. The company expects these headwinds to ease by the end of this fiscal.

Supreme Petrochem advanced 1.14% after net profit rose 28.12% to Rs 36.68 crore on 12.69% growth in net sales to Rs 703.70 crore in Q2 September 2017 over Q2 September 2016. The result was announced after market hours yesterday, 26 October 2017.

Overseas, Asian stocks rose following gains in US equities as earnings and congressional action on tax reform boosted confidence in the growth outlook. The US House passed a budget resolution seen as advancing the prospects for tax reform.

Profits for China's industrial powerhouses surged the most in nearly six years in September. Industrial profits in September rose 27.7% from a year earlier to 662.18 billion yuan ($99.46 billion), accelerating from a 24% jump in August, the National Bureau of Statistics (NBS) said.

US stocks ended mostly higher yesterday, 26 October 2017, as a fusillade of better-than-expected corporate quarterly results helped to reinvigorate Wall Street buying appetite.

Meanwhile, European Central Bank President Mario Draghi yesterday, 26 October 2017, outlined plans to halve its monthly bond purchases to 30 billion euros ($35 billion) from 60 billion euros starting in January, but he also indicated that zero percent interest rates could remain at current levels until well past whenever it finally decides to end its quantitative easing measures.

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