A bout of volatility was witnessed in early trade as key benchmark indices slipped into the red after opening higher. At 9:30 IST, the barometer index, the S&P BSE Sensex was down 15.16 points or 0.06% at 27,186.33. The Nifty 50 index was currently down 19.10 points or 0.23% at 8,318.80. FMCG and bank stocks dropped in early trade. Weakness in Asian stocks weighed on sentiment.
In overseas stock markets, Asian stocks edged lower as investors awaited US jobs data to get a clearer picture of the health of the world's biggest economy. US stocks closed mostly lower yesterday, 7 July 2016, tracking sinking oil prices, but the market pared losses late in the session as investors sought bargains ahead of the closely watched jobs report. Private-sector employment picked up a bit in June, suggesting the weak May nonfarm-payroll report may be an anomaly, Automatic Data Processing Inc. reported yesterday, 7 July 2016 and initial jobless claims fell last week to a nearly three-month low, showing no evidence of rising layoffs. The US government will announce nonfarm payroll report for June 2016 today, 8 July 2016
Closer home, the market breadth indicating the overall health of the market was positive. On BSE, 729 shares rose and 674 shares declined. A total of 55 shares were unchanged. The BSE Mid-Cap index was currently up 0.14%. The BSE Small-Cap index was currently up 0.19%. Both these indices outperformed the Sensex.
Tata Motors (up 1.99%), Hero MotoCorp (up 0.86%) and Lupin (up 0.77%) were the major gainers from the Sensex pack. Bharti Airtel (down 2.17%) and ONGC (down 1.06%) were the major losers from the Sensex pack.
Shares of Cairn India dropped 0.85% as the stock turned ex-dividend today, 8 July 2016, for final dividend of Rs 3 per share for the year ended 31 March 2016.
Reliance Industries (RIL) declined 0.05%. Reliance Jio Infocomm (RJIL), a subsidiary of RIL, yesterday, 7 July 2016, issued Rs 2000 crore of 5 year non-convertible debentures (NCDs), bearing a coupon of 8.32% per annum, payable annually. The issue has been assigned a rating of AAA by CRISIL and ICRA. The proceeds of the issuance shall be utilized by RJIL for rolling out a digital services business in India. The announcement was made after market hours yesterday, 7 July 2016.
The transaction was fully subscribed within minutes of opening and was eventually over-subscribed with a total book size in excess of Rs 3500 crore, Reliance Jio said. Key investors include the prominent asset management companies and banks. Reliance Jio Infocomm is the first telecom operator to hold pan India Unified License. RJIL has created next-generation voice and broadband network which can be seamlessly upgraded even to 5G and beyond.
Mahindra & Mahindra (M&M) rose 0.37%. The company said that it has received an intimation from Mahindra Holidays & Resorts India (MHRIL), a listed subsidiary of the company that Caribia Service Oy, Finland (Caribia), subsidiary of Holiday Club Resorts Oy, Finland, (HCR), a step-down subsidiary of MHRIL, has been liquidated with effect from 4 July 2016. Shares of MHRIL fell 0.87%. Consequently, Caribia ceased to be a subsidiary of HCR, MHRIL and in turn of the company and all the assets lying in its books were transferred to HCR being the sole shareholder of Caribia. Further, Holiday Club Resorts Oy, Finland, step-down subsidiary of MHRIL and in turn of the company, had entered into the joint venture (JV) agreement with City of Kuusamo, (JV partner) for establishment of Tropiikin Rantasauna Oy. HCR will be holding 50% stake in Tropiikin. Shares costing 62,500 Euros will be acquired at the time of formation of Tropiikin.
Meanwhile, India Meteorological Department said in its latest update yesterday, 7 July 2016 that in the week from 30 June to 6 July 2016, rainfall was above long period average (LPA) by 35% over the country as a whole. For the country as a whole, cumulative rainfall during this year's monsoon has so far upto 6 July been 1% above LPA, thus making a further recovery of 13% from the last week ending on 29 June, it added. IMD had predicted above normal rains this monsoon season. The monsoon rains is important for the farm sector, as around 70% of the country's farmlands are rain-fed. The rains have an impact on the whole economy, as rural spending on consumer goods depends on the rainfall.
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