Sensex, Nifty advance in early trade

Indian stocks are trading firm in early trade on buying demand in index pivotals. At 9:25 IST, the barometer index, the S&P BSE Sensex, was up 229.03 points or 0.59% at 39,302.95. The Nifty 50 index was up 63.40 points or 0.55% at 11,613.

The S&P BSE Mid-Cap index was up 0.46%. The S&P BSE Small-Cap index was up 0.56%.

The market breadth, indicating the overall health of the market, is strong. On the BSE, 1173 shares rose and 604 shares fell. A total of 96 shares were unchanged.

F&O expiry:

Trading could be volatile as traders roll over positions in the F&O segment from the near month August series to September series. The August 2020 F&O contracts expire today, 27 August 2020.

GST Council meeting:

The Goods and Services Tax (GST) Council will hold its 41st meeting today, 27 August 2020 to discuss the single-point agenda of compensation to states for revenue losses under the indirect tax regime. The meeting will be held via video conferencing. Several options including expanding the ambit of compensation cess, market borrowing to fund compensation deficit along with a future plan for rate rationalisation beginning from correction of inverted duty structure for some items are expected to be discussed in the meeting.

Stocks in news:

ICICI Bank rose 0.94%. ICICI Securities fell 1.51% to Rs 498.15. ICICI Bank said its board of directors approved the sale of up to 6,442,000 equity shares of ICICI Securities, representing up to 2% of its issued and paid-up equity share capital, through an open market sale, in accordance with applicable law, towards compliance with the requirement of minimum public float of the company.

Mahindra & Mahindra (M&M) rose 1.01%. M&M and REE Automotive (REE) have signed a Non-Binding Memorandum of Understanding (MOU) to explore development and manufacturing of electric commercial vehicles using REE's corner module technology and the Company's vehicle design, engineering, sourcing capability and manufacturing assets.

Hindustan Aeronautics lost 9.77% to Rs 1063. The government will sell up to 15% stake in the stock through an offer for sale (OFS). The floor price for the offer has been fixed at Rs 1,001 per equity share. The stake sale will take place on a separate window of the stock exchanges on August 27 and 28, 2020.

Siemens rose 0.11%. The board of directors of Siemens has approved the sale and transfer of the company's Mechanical Drives (MD) Business, to Flender Drives Private Limited, a subsidiary of Flender GmbH, which in turn is a subsidiary of SAG, as a going concern on a slump sale basis, with effect from 1st January, 2021 for a cash consideration of Rs 440 crore, subject to adjustment for the change in net current assets and capital expenditure, subsequent to 30th June, 2020 upto the date of actual transfer of the MD Business.

Jindal Stainless gained 2.54%. Jindal Stainless said that the board of directors of the company considered and approved raising funds through issue of convertible equity warrants for an amount upto Rs 162.80 crore, on preferential basis.

Allcargo Logistics fell 0.19%. The company's board of directors will meet today, 27 August 2020 to consider and approve the voluntary delisting of shares from BSE and National Stock Exchange of India.

Global Markets:

Overseas, Asian stocks are trading higher on Thursday after the S&P 500 and Nasdaq rallied to fresh records on upbeat corporate results.

Profits at China's industrial firms grew 19.6% year-on-year to 589.5 billion yuan ($85.58 billion), the statistics bureau said on Thursday. It follows an 11.5% gain in June and the third straight month of profit growth in this year.

In US, stocks surged on Wednesday, pushing the S&P 500 to its fourth straight record closing high, as investors stayed focused on largecap momentum stocks that have outperformed since the onset of the coronavirus pandemic.

Fed Chairman Jerome Powell will speak Thursday during a virtual version of the Fed's annual Jackson Hole, Wyoming, conference. He is expected to outline what could be the central bank's most active efforts ever to spur inflation back to a healthy level.

Back home, the benchmark indices ended with decent gains on Wednesday, supported by private banks and auto stocks. The Nifty managed to close near 11,550 mark. The barometer index, the S&P BSE Sensex, rose 230.04 points or 0.59% at 39,073.92. The Nifty 50 index added 77.35 points or 0.67% at 11,549.60. It has risen 2.10% in four sessions.

Foreign portfolio investors (FPIs) bought shares worth Rs 1,581.31 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 1,194.62 crore in the Indian equity market on 26 August, provisional data showed.

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