PSU bank stocks nudge higher

Key benchmark indices hovered near the flat line in mid-morning trade. At 11:15 IST, the barometer index, the S&P BSE Sensex was up 11.71 points or 0.04% at 26,239.33. The Nifty 50 index was currently up 7.55 points or 0.09% at 8,087.50.

In overseas stock markets, Asian stocks witnessed a mixed trend. US stocks registered modest gains yesterday, 17 November 2016, as investors parsed through economic data and Federal Reserve Chair Janet Yellen's testimony. Yellen has stressed the importance of central bank independence in her first public remarks after Donald Trump's election victory as new data showed the president-elect will inherit a strengthening economy. The Federal Reserve chair told a congressional hearing yesterday, 17 November 2016 that an increase in short-term interest rates could become appropriate relatively soon, raising expectations of a rise at the Fed's next meeting in December.

Closer home, the market breadth indicating the overall health of the market was negative. On BSE, 1,081 shares declined and 1,064 shares rose. A total of 101 shares were unchanged. The BSE Mid-Cap index was currently up 0.55%, outperforming the Sensex. The BSE Small-Cap index was currently down 0.03%, underperforming the Sensex.

Stocks of public sector banks edged higher. Union Bank of India (up 5.02%), Bank of India (up 1.84%), Punjab National Bank (up 1.76%), IDBI Bank (up 1.57%), Bank of Baroda (up 1.32%) and State Bank of India (up 0.09%) rose.

Stocks of private sector banks were mixed. HDFC Bank (down 0.58%), ICICI Bank (down 0.49%), Yes Bank (down 0.37%) and Kotak Mahindra Bank (down 0.08%) declined. RBL Bank (up 1.3%), IndusInd Bank (up 0.23%) and Axis Bank (up 0.11%) gained.

Realty stocks were mixed. Prestige Estates Projects (down 2.37%), Unitech (down 1.32%), D B Realty (down 1.13%), Godrej Properties (down 1.11%) and Sobha (down 0.41%) declined. Housing Development & Infrastructure (up 1.66%), Indiabulls Real Estate (up 1.15%), Oberoi Realty (up 0.81%) and DLF (up 0.04%) edged higher.

Deepak Fertilisers & Petrochemicals Corporation (DFPCL) tumbled 7.36% after net profit declined 4.77% to Rs 26.96 crore on 14.23% fall in net sales to Rs 932.71 crore in Q2 September 2016 over Q2 September 2015. The result was announced after market hours yesterday, 17 November 2016. DFPCL said that the company witnessed marginal growth in chemical business, however, recorded subdued performance in fertilisers because of higher carryover stocks in the country and comparatively lower volumes in ammonium nitrate due to seasonal slowdown with delayed and extended monsoons. The combined negative impact in the fertiliser sector emerging out of the delayed monsoons, inventory build- up from earlier quarter and sudden price cuts impacted the performance in Q2 September 2016, DFPCL said. Good rainfalls followed with brisk sales and lowering of raw material costs should help improve the workings of the subsequent quarters, the company said. The softening of raw material prices, specially ammonia, would help the company combat global competition, it added.

Sailesh C. Mehta, Chairman & Managing Director, DFPCL said that after two consecutive droughts, the country witnessed good monsoons in the current year. The company is poised for achieving smooth production with restoration of full scale water supply and is optimistic with respect to outlook for demand growth across all businesses, Mehta said.

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