Market turns range bound

Key benchmark indices were range bound in mid-afternoon trade. At 14:22 IST, the barometer index, the S&P BSE Sensex, rose 99.05 points or 0.31% at 31,869.94. The Nifty 50 index advanced 29.20 points or 0.30% at 9,926.50.

The Sensex and the Nifty reversed trend in mid-morning trade after hitting their highest levels in more than a week in morning trade. Both the indices bounced back in early afternoon trade.

Among other key indices, the S&P BSE Mid-Cap index was down 0.10%, underperforming the Sensex. The S&P BSE Small-Cap index advanced 0.67%, outperforming the Sensex.

The breadth, indicating the overall health of the market, was positive. On BSE, 1,415 shares rose and 1,072 shares fell. A total of 119 shares were unchanged.

Reliance Industries (RIL) was up 0.36% to Rs 1,572.55. With reference to news item titled, "Govt slaps Rs.1,700-cr penalty on RIL, BP" and media report titled, "$264 m penalty slapped on RIL", RIL clarified during trading hours today, 17 August 2017, that it has not received any notice from the government regarding penalty in the recent past. The details contained in media reports of 16 August 2017 seems to have been taken from the last notice of 3 November 2016 received from the Government for which company has already made appropriate disclosures.

In any event, all related claims/disputes relating to Block KG-D6 are currently in arbitration. Further, all these claims have been adequately covered under financial disclosures. RIL maintained that in carrying out petroleum operations, the contractor has complied with all the applicable regulations and provisions of the production sharing contract.

Capital goods shares were mixed. BEML (up 8.82%), Bharat Electronics (up 3.62%), Havells India (up 0.86%), Punj Lloyd (up 0.76%), Reliance Defence and Engineering (up 0.56%), ABB India (up 0.52%), SKF India (up 0.39%), Siemens (up 0.25%), GE Power India (up 0.13%), AIA Engineering (up 0.12%) and GE T&D India (up 0.07%), edged higher. Jindal Saw (down 0.05%), Bharat Heavy Electricals (down 0.27%), Thermax (down 0.38%), Suzlon Energy (down 0.57%), Crompton Greaves (down 0.74%), Praj Industries (down 0.84%) and Lakshmi Machine Works (down 0.96%), edged lower.

Engineering and construction major Larsen & Toubro (L&T) was up 0.12% to Rs 1,143. The company announced during trading hours today, 17 August 2017, that it delivered two more High Speed Interceptor Ships (C-433 and C-434) to Indian Coast Guard at the company's Kattupalli Shipyard, near Chennai, seven months ahead of contractual schedule. This is part of the two contracts being executed by L&T for design and construction of 54 Interceptors to Indian Coast Guard, valued at Rs 1424 crore. L&T had won the order against Global competition. With these two, 34 Interceptors have been delivered by the company, so far.

L&T announced after market hours yesterday, 16 August 2017, that it entered into definitive agreement for the divestment of its entire stake in L&T Cutting Tools, a wholly-owned subsidiary, with IMC International Metalworking Companies B.V, a company owned by Berkshire Hathaway Inc.

Power generation stocks were mixed. GMR Infrastructure (up 14.94%), Jaiprakash Power Ventures (up 4.87%), NTPC (up 1.76%), CESC (up 1.50%), Torrent Power (up 0.95%) and Reliance Infrastructure (up 0.12%), edged higher. JSW Energy (down 0.08%), Tata Power (down 0.55%), NHPC (down 0.8%) and Adani Power (down 1.36%), edged lower.

State-run Power Grid Corporation of India was down 0.16%. State-run Coal India was up 4.16%.

Overseas, European stocks edged lower as uncertainty surrounding internal US policy continued to weigh on investor sentiment despite lessening tensions from North Korea. Asian stocks witnessed a mixed trend.

In economic news, Japanese exports rose 13.4% in July from a year ago, helped by exports of cars and automotive components. It was the eighth straight monthly gain in exports, data from Japan's Ministry of Finance showed today, 17 August 2017.

In US, shares closed slightly higher on Wednesday, 16 August 2017, but backlash from the business community against President Donald Trump kept gains in check. US President Donald Trump unexpectedly said on Wednesday, 16 August 2017, he was disbanding two advisory councils comprising prominent business executives. The move came after several members of Trump's Strategic and Policy Forum and Manufacturing Jobs Initiative councils stepped down following the president's Tuesday press conference in which the president blamed "both sides" for violence at a white nationalist rally in Virginia.

Meanwhile, minutes from the Federal Open Market Committee's July meeting released on Wednesday, 16 August 2017, showed that while some Fed members said they were worried over the tightening labor market, others voiced their concern over low inflation rates in the US. The minutes also showed the central bank was prepared to trim its massive balance sheet, although the announcement of a start date was left for an upcoming meeting.

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