Market breadth turns from positive to negative

Key benchmark indices drifted lower in morning trade ahead of the outcome of Reserve Bank of India's (RBI) monetary policy review. At 10:15 IST, the barometer index, the S&P BSE Sensex was off 48.93 points or 0.17% at 28,133.64. The Nifty 50 index was currently off 14.30 points or 0.16% at 8,697.05. The RBI will issue a monetary policy statement at 11:00 IST. The central bank left its benchmark interest rate viz. the repo rate unchanged at 6.5% at its previous policy meeting on 7 June 2016.

The market breadth indicating the overall health of the market turned negative from positive in morning trade. On BSE, 1,003 shares fell and 980 shares rose. A total of 88 shares were unchanged. The BSE Mid-Cap index was currently off 0.3%. The BSE Small-Cap index was currently off 0.24%. The fall in both these indices was higher than the Sensex's decline in percentage terms.

The Sensex rose 107.39 points or 0.38% at the day's high of 28,289.96 at onset of trading session, its highest level since 10 August 2015. The barometer index fell 66.54 points or 0.24% at the day's low of 28,116.03 in early trade, its lowest level since 5 August 2016. The Nifty rose 17 points or 0.2% at the day's high of 8,728.35 at onset of trading session, its highest level since 16 April 2015. The index fell 24.60 points or 0.28% at the day's low of 8,686.75 in early trade, its lowest level since 5 August 2016.

In overseas stock markets, most Asian shares rose as US crude oil traded near its highest price in two weeks. US stocks closed lower yesterday, 8 August 2016, after touching record highs as Wall Street caught its breath in the wake of last week's upbeat jobs data.

Bank stocks rose ahead of the Reserve Bank of India's (RBI) monetary policy review. Among private bank stocks, ICICI Bank (up 0.84%), Federal Bank (up 0.06%), City Union Bank (up 0.55%), Axis Bank (up 0.83%) and IndusInd Bank (up 0.11%) rose. HDFC Bank (down 0.29%), Kotak Mahindra Bank (down 0.26%), and Yes Bank (down 0.21%) declined.

Among PSU bank stocks, State Bank of India (SBI) (up 0.6%), Central Bank of India (up 1.34%), Bank of Baroda (up 0.41%), Canara Bank (up 1.22%), IDBI Bank (up 0.22%), Bank of India (up 0.91%) and Union Bank of India (up 1.21%) rose. Punjab National Bank shed 0.04%.

Interest rate sensitive auto stocks declined ahead of the Reserve Bank of India's (RBI) monetary policy review. Hero MotoCorp (down 0.14%), Escorts (down 0.71%), TVS Motor Company (down 0.35%), Maruti Suzuki India (down 0.28%), Mahindra & Mahindra (M&M) (down 0.41%), Eicher Motors (down 0.68%) fell. Ashok Leyland (up 0.11%) and Bajaj Auto (up 0.38%), rose.

Tata Motors rose 0.73% after the company said that its group global wholesales, including Jaguar Land Rover rose 20% to 88,159 units in July 2016 over July 2015. Global wholesales of all Tata Motors' commercial vehicles and Tata Daewoo range in July 2016 was flat at 30,363 compared to July 2015. Global wholesales of all passenger vehicles rose 34% to 57,796 units in July 2016 over July 2015.

Meanwhile, the amended goods and services tax (GST) constitutional amendment bill was passed by the Lok Sabha yesterday, 8 August 2016. The bill was passed by the Rajya Sabha last week. Prime Minister Narendra Modi in Lok Sabha said that with GST, the government intends to bring uniformity in taxation. Most of the things that can impact consumer inflation have been kept out of the ambit of GST, Modi said. He was intervening during the debate in the Lok Sabha on the GST Bill yesterday, 8 August 2016. The government plans to implement the nationwide GST from 1 April 2017. The main objective of the GST is to eliminate excessive taxation. GST is a uniform indirect tax levied on goods and services across a country. The measure would harmonize 11 state and central levies into a national sales tax, reducing business transaction costs.

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