Market turns volatile

Volatility struck bourses in morning trade as stocks trimmed gains notched in early trade. At 10:28 IST, the barometer index, the S&P BSE Sensex, was down 4.03 points or 0.01% at 31,652.58. The Nifty 50 index was up 0.20 points at 9,915.10. Amid a divergent trend among various index constituents, key benchmark indices were hovering near the flat line.

Domestic stocks nudged higher in early trade, extending their prior four-day winning trend.

The S&P BSE Mid-Cap index was up 0.41%. The S&P BSE Small-Cap index was up 0.53%. Both these indices outperformed the Sensex.

The market breadth, indicating the overall health of the market, was strong. On the BSE, 1,365 shares rose and 777 shares fell. A total of 67 shares were unchanged.

Overseas, Asian stocks were trading with small gains in holiday-thinned trade. Stock markets in Hong Kong, China, and South Korea were closed for holidays. US stocks posted modest gains yesterday, 4 October 2017 extending their recent streak of advances that's taken all major benchmarks to record levels. The Dow Jones Industrial Average eked out a small gain of 19.97 points, or 0.1%, to 22,661.57. The Nasdaq Composite Index meanwhile, advanced 2.91 points, or less than 0.1%, to 6,534.63, as gains were limited by a slump in technology shares. The S&P 500 rose 3.16 points, or 0.1%, to 2,537.74.

In US economic news, Markit's September figure for its services purchasing managers index dipped to 55.3 in September from 56 in August. The Institute for Supply Management's index of non-manufacturing activity rose to 59.8 in September, compared with 55.3 in the prior period and marked its highest level since mid-2005. A reading of 50 or greater indicates expansion.

Back home, cement stocks gained. Ambuja Cements (up 1.32%), ACC (up 1.07%), UltraTech Cement (up 0.9%) gained. Shree Cement (down 0.01%) fell.

Grasim Industries was up 0.47%. Grasim has exposure to the cement sector through its holding in UltraTech Cement.

Telecom stocks fell. Tata Teleservices (Maharashtra) (down 1.96%), Bharti Airtel (down 0.7%), Idea Cellular (down 0.67%), MTNL (down 0.52%), and Reliance Communications (down 0.29%) declined.

Shares of Bharti Infratel lost 2.96%. Bharti Infratel is a provider of tower and related infrastructure and is a unit of Bharti Airtel.

Parag Milk Foods rose 1.46% The Reserve Bank of India notified after market hours yesterday, 4 October 2017, that the foreign investment limit for investment by foreign institutional investors (FIIs)/foreign portfolios investors (FPIs) in Parag Milk Foods has increased from 24% to 40% of its paid up capital.

Further, owing to the above increase in the above investment limit, it is notified that the aggregate shareholding by FIIs/FPIs in Parag Milk Foods has gone below the prescribed FIIs/FPIs investment limit for the company. Hence, the restrictions placed on the purchase of shares of the above company by FIIs/FPIs are withdrawn with immediate effect.

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