It has been a positive start to the month of June as the Indian stock market closed the first trading session in the green. The gross domestic product (GDP) number for January-March quarter was robust however it failed to build the momentum. India’s GDP grew 7.9% in the January-March quarter of 2015-16, taking the overall economic growth to a five-year high of 7.6% for the entire fiscal. Even the country’s manufacturing PMI came in at 50.7 as against 50.5 in April indicating an uptick in the manufacturing data. Nifty closed with again of 20 points at 8,180, while BSE Sensex ended with again of 46 points at 26,714.
On the global front, most of the Asian indices closed the day on a negative note. Hong Kong’s Hang Seng ended lower by 0.26%, while Japan’s Nikkei 225 ended lower by 1.62%. The European indices also witnessed selling pressure. The FTSE 100 was down 0.72%, France’s CAC 40 was down 0.83% and Germany’s DAX was down 0.7%. The rupee was trading at Rs 67.45 to the dollar at the time of writing.
As per a leading financial daily, ONGC Videsh, a wholly owned subsidiary ofOil and Natural Gas Corporation (ONGC), has completed acquisition of 15% equity from Rosneft Oil Company, in JSC Vankorneft.
The deal was initially signed in September 2015. Back then, ONGC Videsh and Rosneft had signed agreement for ONGC Videsh to acquire not less than 15% shares in JSC Vankorneft, for a consideration of US$ 1,268 million.
The stock of ONGC closed the day lower by 0.2%.
Moving on to news from the banking space. As per an article in a leading financial daily, the Reserve Bank of India (RBI) has raised the cap on foreign share holding in Axis Bank. RBI has raised foreign shareholding to 62%, from the earlier limit of 49%.
Reportedly, foreign institutional investors (FIIs) and registered foreign portfolio investors (RFPIs) can now invest up to 62% of the paid-up capital of Axis Bank under the Portfolio Investment Scheme (PIS).
This was moved by the board and was approved by the shareholders through a special resolution.
Axis Bank is the third largest bank in India. In its results for the fourth quarter ended March 2016, the bank reported 18.3% YoY and 11.8% YoY growth in net interest income and net profits respectively in FY16. Both the gross and net non-performing asset levels were higher in March 2016. The provision coverage ratio was at 72% at the end of March 2016 (82% before accumulated write-offs). The restructured advances were 2.3% of total loan book. To know our view on the stock of Axis Bank, you can read our detailed result analysis (subscription required).
The stock of Axis Bank closed the day down by 0.4%.
After opening the day firm, the Indian indices have continued their momentum and are presently trading on a positive note. Sectoral indices are trading on a mixed note with stocks from the telecom, FMCG and IT sectors leading the gains.
Crude oil is witnessing volatility. At the time of writing, crude oil was trading at Rs 3,286 per barrel, down by around 1.4%. This is seen on the back of a stronger dollar and concerns about the outcome of this week’s OPEC meeting. One shall note that the Organization of the Petroleum Exporting Countries (OPEC) are going to meet in Vienna this week where a deal on capping production is to be discussed.
USDINR trade today trading down 16 paise at 67.42 per US dollar.
Out of 1,400 stocks traded on the NSE, 597 declined and 759 advanced today.
Top 5 Nifty Gainers: Tata Motors (1.74%), Coal India (1.15%), Infosys Ltd (1.00%), M&M (0.61%) and Bharti Airtel (0.59%).
Top 5 Nifty Losers: L&T (-1.47%), Bajaj Auto (-1.23%), Axis Bank (-1.09%), ITC Ltd (-1.08%) and GAIL (-1.01%)
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