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Indian share markets continued to trade range bound in afternoon session amid mixed international markets after US tax bill was passed in the Senate and Bank of Japan kept interest rates steady.
At the closing bell, the BSE Sensex closed lower by 21 points and the NSE Nifty finished lower by 15 points. The S&P BSE Mid Cap finished up by 0.8% while S&P BSE Small Cap finished up by 1.1%. Gains were largely seen in power sector, capital goods sector and pharma sector. Auto stocks and bank stocks witnessed majority of the selling activity.
Asian stock markets finished mixed as of the most recent closing prices. The Hang Seng gained 0.45% and the Shanghai Composite rose 0.38%. The Nikkei 225 lost 0.11%. European markets are mixed. The FTSE 100 is higher by 0.11%, while the CAC 40 is leading the DAX lower. They are down 0.22% and 0.21% respectively.
Rupee was trading at Rs 64.09 against the US$ in the afternoon session. Oil prices were trading at US$ 58.02 at the time of writing.
As per an article in The Livemint, mutual funds pumped in a net of Rs 120.80 billion of Indian shares in November while DIIs invested a net of Rs 92.43 billion in the asset class last month.
Mutual funds stocked up shares of Larsen & Toubro Ltd, ITC Ltd and Bharti Airtel Ltd the most in November, reflecting the launch of Bharat 22 ETF (exchange-traded fund), while they locked in gains in HDFC Bank Ltd and Reliance Industries Ltd.
The government launched the Bharat 22 ETF, managed by ICICI Prudential Mutual Fund, on 14 November, targeting an initial amount of about Rs 80 billion. The new fund offer (NFO) was subscribed four times the initial size of Rs 80 billion.
In news from engineering sector, ABB India has won an order worth Rs 1.34 billion to supply state-of-the-art traction equipment for electric locomotives, manufactured by Chittaranjan Locomotive works (CLW).
The company will deliver traction converters, standalone auxiliary converters and vehicle control units for 64 electric locomotives which will be used for passenger and freight operations.
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This order further strengthens ABB's position in the Indian market where the government wants to equip electric locomotives with the next generation of propulsion system, with the state-of-the-art traction converters. It also supports the larger government initiative of energy efficiency and electrification of railways.
ABB share price finished the day down by 0.2% on the BSE.
As per a leading financial daily, the government is looking at further easing foreign direct investment (FDI) in the telecom services including infrastructure, by allowing 100% foreign equity through the automatic route which allows firms to attract foreign funds without its approval.
At present, all telecom services, including telecom infrastructure providers, such as basic, cellular, unified access services, unified licence (access services), unified licence, dark fibre, right of way, duct space and tower have FDI cap/equity up to 100% and automatic up to 49%. The inflow of overseas investment beyond that requires government approval because of security reasons.
Increasing the FDI limit to 100% under automatic route for infrastructure providers would create transparency and abolish bureaucracy or red-tapism.
The panel is also likely to discuss the relief package recommended by an inter-ministerial group (IMG) for the telecom sector which is reeling under debt of around Rs 4.5 trillion. The panel may also consider the approval of grants for IITs to set up a lab for indigenous development and testing of 5G technologies.
In another development, Reliance Communications (Rcom) share price continued to surge in today's trade as well and finished up by 4.2%. The company surged nearly 44% in the previous trade.
The sharp rise in the stock came amid reports that the National Company Law Tribunal (NCLT) adjourned the hearing of insolvency petitions filed against Reliance Communications to early next month.
Meanwhile, the sentiment also remained optimistic ahead of the joint lenders' forum meeting scheduled due later on Thursday. The forum is expected to discuss the bids it has received for sale of the company's assets. According to a Business Standard report, Reliance Jio has been one of the key bidders and has shown interest in both fibre (they are one of the main bulk users) as well as spectrum.
RCom is reeling under a total debt of Rs 450 billion. Of this, Rs 250 billion is domestic debt and remaining Rs 200 billion is in the form of foreign loans and bonds.
Moving on to news from the economy. As per an article in The Livemint, the 10-year bond yield hit fresh 17-month high as traders' view minutes of the Reserve Bank of India's (RBI) latest policy as hawkish.
The 10-year bond yield was at 7.276%-a level last seen on 21 July 2016, compared to its previous close of 7.219%. Bond yields and prices move in opposite directions.
Most members of RBI's rate setting committee are increasingly worried about fresh risks to inflation, with their hawkish tone suggesting that the rate cutting cycle has come to an end.
Foreign debt raised by Indian companies surged ten-folds to US$ 41 billion in 2017. This is the highest ever infusion of foreign funds in the domestic debt markets in the last 15 years. At US$ 23 billion, foreign investments in government securities and corporate paper took the cake. This was followed by dollar denominated bonds that attracted around US$ 16 billion of foreign investments whereas funds of US$ 2 billion were mopped up by masala bonds. Masala Bonds are rupee-denominated borrowings by Indian entities in the overseas markets.
Yesterday after market hours, Pidilite industries announced that its board will meet on 26 December 2017, to consider the proposal to buyback the fully paid-up equity shares of the company. And today, the stock opened gap up and rallied 4% with strong volumes.
Last time we reviewed the stock, it had bounced from 750 level, which is the strong horizontal support (green line) for the stock. And we suspected that the stock might soon make a new life-time high. A few days back, the stock achieve its life high of 899, and later was partially corrected.
And today, it touched a fresh life-time high of 935 after the buyback news.
So, can the stock continue with the upside momentum or will it find some selling at its life high?
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Please Note: The stock price of M&M on NSE-50 is not adjusted for bonus issue. Kindly refer to its BSE's quote today for the adjusted price.