Market extends initial gains

Key benchmark indices extended initial gains and hit fresh intraday high in morning trade. At 10:20 IST, the barometer index, the S&P BSE Sensex was up 202.94 points or 0.73% at 28,105.60. The Nifty 50 index was currently up 63.45 points or 0.74% at 8,670.90. The Sensex was hovering above the psychological 28,000 mark after regaining that mark in early trade. Firmness in Asian stocks boosted sentiment.

The Sensex rose 218.74 points or 0.78% at the day's high of 28,121.40 in morning trade, its highest level since 25 August 2016. The barometer index gained 108 points or 0.38% at the day's low of 28,010.66 at the onset of the trading session. The Nifty rose 68.05 points or 0.79% at the day's high of 8,675.50 in morning trade, its highest level since 25 August 2016. The index gained 34.80 points or 0.4% at the day's low of 8,642.25 at the onset of the trading session.

In overseas stock markets, Asian stocks rose tracking overnight gains in US stocks as commodities prices rebounded. US stocks finished higher yesterday, 29 August 2016 on increased prospects for Federal Reserve rate increases in 2016. Investors continued to weigh remarks by Federal Reserve Chairwoman Janet Yellen, who said late last week in Jackson Hole, Wyo., that an improving US economy had strengthened the case for a rate increase. The Fed last December delivered its first rate increase in nearly a decade. The focus is now on US nonfarm-payroll data for August due coming Friday, 2 September 2016.

Closer home, the broad market depicted strength. There were more than two gainers against every loser on BSE. 1,471 shares rose and 514 shares fell. A total of 101 shares were unchanged. The BSE Mid-Cap index was currently up 0.75%. The BSE Small-Cap index was currently up 0.92%. Both these indices outperformed the Sensex.

Telecom stocks declined. Reliance Communications (RCom) (down 0.09%), Bharti Airtel (down 0.22%), Tata Teleservices (Maharashtra) (down 0.77%) and Idea Cellular (down 0.05%) declined.

Shares of Bharti Infratel rose 0.92%. Bharti Infratel is a provider of tower and related infrastructure and is a unit of Bharti Airtel.

The BSE Telecom index had underperformed the market over the past one month till 29 August 2016, falling 6.86% compared with 0.53% slide in the Sensex. The index had also underperformed the market in past one quarter, dropping 5.58% as against Sensex's 4.69% rise.

Capital goods stocks gained. Bharat Heavy Electricals (Bhel) (up 0.53%), Havells India (up 2.54%), ABB India (up 1.09%), Bharat Electronics (up 0.4%), BEML (up 0.1%), L&T (up 0.81%), Thermax (up 1.09%), and Siemens (up 0.9%) gained.

The BSE Capital Goods index had underperformed the market over the past one month till 29 August 2016, falling 4.09% compared with 0.53% slide in the Sensex. The index had also underperformed the market in past one quarter, gaining 2.24% as against Sensex's 4.69% rise.

eClerx Services rose 3.14% after the company's board of directors at its meeting held yesterday, 29 August 2016, approved a proposal for buyback of equity shares of the company for an aggregate amount not exceeding Rs 234 crore at a price not exceeding Rs 2,200 per share. The company will buy back shares on proportionate basis from existing shareholders through the tender offer route. At maximum buyback price, the buyback translates into approximately 10.68 lakh equity shares of the company, representing about 2.62% of the total paid up equity share capital of the company as on 31 March 2016. The promoters and promoter group of the company intend to participate in the proposed buyback. The announcement was made after market hours yesterday, 29 August 2016.

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