Key benchmark indices were trading with tiny losses after regaining positive terrain for a brief period in mid-morning trade. At 11:25 IST, the barometer index, the S&P BSE Sensex was down 7.77 points or 0.03% at 27,774.48. The Nifty 50 index was currently down 4.65 points or 0.05% at 8,567.90. Weakness in most of the Asian stocks weighed on sentiment.
In overseas stock markets, Asian stocks edged lower after Federal Reserve Chairwoman Janet Yellen on Friday, 26 August 2016 signaled the possibility of an interest-rate increase later this year. But, Japanese shares bucked a weak trend in Asian stocks, boosted by a relatively weaker yen. Japan's Nikkei Average was currently up 2.23%. Investors tend to pull money out of assets in emerging markets and redirect it to the assets in US if there is a hike in US interest rates in their search for higher yields in the US.
US stocks closed mixed on Friday, 26 August 2016 after Federal Reserve Chairwoman Janet Yellen signaled the possibility of an interest-rate increase later this year. On Friday, 26 August 2016, Yellen in her highly-anticipated speech at an economic symposium at Jackson Hole, Wyoming said she was optimistic about the US economy, fueling expectations that interest rate hikes were ahead. She said the Federal Open Market Committee continued to anticipate gradual increases in the federal funds rate over time to achieve and sustain employment and inflation in line with the Fed's objectives. She added that the solid performance in the US labor market and outlook for economic activity and inflation had strengthened the case in recent months for an increase in the federal funds rate.
Closer home, the market breadth indicating the overall health of the market was negative. On BSE, 1,185 shares fell and 1,019 shares rose. A total of 145 shares were unchanged. The BSE Mid-Cap index was currently down 0.09%. The decline in this index was higher in percentage terms than those for the Sensex. The BSE Small-Cap index was currently up 0.04%, outperforming the Sensex.
IT stocks dropped. HCL Technologies (down 2.21%), TCS (down 1.87%), Tech Mahindra (down 1.64%), Infosys (down 0.28%), and Wipro (down 1.94%) edged lower.
Most auto stocks gained. Ashok Leyland (up 0.86%), Maruti Suzuki India (up 0.48%), Bajaj Auto (up 0.42%), Hero MotoCorp (up 1.04%), Tata Motors (up 4.49%) and TVS Motor Company (up 0.38%) gained. Mahindra & Mahindra (M&M) (down 0.39%) and Eicher Motors (down 0.57%) declined.
Tata Motors rose 4.49%, with the stock extending previous session's 2.01% gains after announcement of Q1 results. The company's consolidated net profit declined 57.25% to Rs 2236 crore on 9.01% growth in revenue to Rs 67056 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours on Friday, 26 August 2016. Higher volumes in both standalone as well as Jaguar Land Rover (JLR) business was more than offset by the adverse foreign currency impact of Rs 2296 crore and adverse commodity derivatives impact of Rs 167 crore in the operating profit mainly in the Jaguar Land Rover business. The profitability was also adversely impacted by lower local market incentive in the JLR business as compared to the corresponding quarter last year and higher depreciation and amortization expenses as compared to the corresponding quarter last year.
Tata Motors' board at the time of announcement of results approved raising funds aggregating Rs 3000 crore by way of issue of secured/unsecured debentures and/or bonds in one or more tranches, from time to time.
Procter & Gamble Hygiene and Health Care fell 2.49% after net profit rose 2.16% to Rs 109.40 crore on 0.71% increase in total income to Rs 580.45 crore in Q4 June 2016 over Q4 June 2015. The result was announced after trading hours on Friday, 26 August 2016. The company's net sales were flat at Rs 557.09 in Q1 June 2016 over Q1 June 2015, due to overall category slowdown on health care. P&G Healthcare's net profit rose 22.26% to Rs 423.18 crore on 6.41% rise in net sales to Rs 2481.68 crore in the year ended June 2016 over the year ended June 2015.
JBF Industries fell 2.68% after net profit declined 49.59% to Rs 9.83 crore on 4.81% rise in total income to Rs 950.44 crore in Q1 June 2016 over Q1 June 2015. The result was announced after market hours on Friday, 26 August 2016.
MEP Infrastructure Developers rose 1.38% after the company said it has received the letter of acceptance (LOA) from National Highways Authority of India (NHAI) that it has been engaged as the contractor for the project of Sau-Kala of National Highway no-2 in Jharkhand.
The contract is for user fee collection rights at Sau-Kala toll plaza. The period of contract is one year and the contractual amount for the said project is Rs 87.30 crore payable to NHAI on a weekly basis over a period of one year. The operations will commence from 14 September 2016 after complying the statutory formalities viz. submission of performance security, signing of contract as per the LOA. The commercial operation date (COD) will be achieved in the current quarter. The announcement was made on Saturday, 27 August 2016.
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