Key benchmark indices extended gains in mid-morning trade. At 11:22 IST, the barometer index, the S&P BSE Sensex, was up 268.66 points or 0.86% at 31,552.38. The Nifty 50 index was up 80 points or 0.82% at 9,868.60. Positive Asian stocks boosted sentiment on domestic bourses. Stock markets were closed on Monday, 2 October 2017 on account of Mahatma Gandhi Jayanti.
Domestic stocks saw a gap-up opening tracking positive Asian stocks as trading resumed after a long weekend. Key benchmark indices were trading firm in morning trade.
The S&P BSE Mid-Cap index was up 1.09%. The S&P BSE Small-Cap index was up 0.96%. Both these indices outperformed the Sensex.
The broad market depicted strength. There were more than two gainers against every loser on BSE. 1,546 shares rose and 717 shares fell. A total of 94 shares were unchanged.
Overseas, Asian stocks were trading higher after strong factory data and the prospect of American tax cuts boosted confidence in the global economy. Markets in China and South Korea remain shut. US equities closed at record highs yesterday, 2 September 2017 as Wall Street kicked off the fourth quarter on a high note on optimism about a recovery in manufacturing.
In US economic data, the closely watched ISM manufacturing index was at 60.8 in September, representing the highest level for the economic reading since 2004 and up from 58.8% in August. A reading of 50 indicates expansion. A separate reading on manufacturing activity from IHS Markit came in at 53.1 for the same month, compared with 52.8 in the prior month.
Back home, metal and mining stocks were in demand as copper prices rose in global commodity markets. Jindal Steel & Power (up 2.89%), Vedanta (up 1.8%), JSW Steel (up 1.51%), Tata Steel (up 1.59%), Steel Authority of India (Sail) (up 0.84%), National Aluminium Company (up 2.87%), Hindustan Zinc (up 3.85%), Hindalco Industries (up 0.62%), NMDC (up 1.02%) and Hindustan Copper (up 0.77%) edged higher.
Copper edged higher in the global commodities market. High Grade Copper for December 2017 delivery was currently up 0.38% at $2.9395 per pound on the COMEX.
Shares of SBI Life Insurance Company were trading at Rs 722, a premium of 3.14% over the initial public offer price of Rs 700. The stock debuted at Rs 733.30, a premium of 4.76% to the initial public offer (IPO) price. So far the stock hit a high of Rs 738 and low of Rs 717.30. SBI Life Insurance Company is India's largest private life insurer in terms of new business premium and a subsidiary of State Bank of India.
The IPO of SBI Life Insurance Company (SBI Life) opened for subscription on 20 September 2017 and closed on 22 September 2017. The IPO received bids for 31.55 crore shares. The IPO was subscribed 3.58 times. The price band for the IPO was set at Rs 685 to Rs 700 per share.
Telecom stocks declined. Idea Cellular (down 0.71%), MTNL (up 0.76%) and Tata Teleservices (Maharashtra) (down 2.18%) fell. Bharti Airtel (up 0.51%) rose.
Reliance Communications dropped 5.47% after the company's board of directors have called off merger of RCom's mobile businesses with Aircel. The announcement was made on Sunday, 1 October 2017. The market remained closed on Monday, 2 October 2017, on account of holiday.
The board of directors of Reliance Communications (RCom) at a meeting held on Sunday, 1 October 2017, reviewed the ongoing strategic transformation programme, and considered alternate plans for debt reduction. RCom and Aircel had signed binding agreements in September 2016 for the merger of RCom's mobile businesses with Aircel. Legal and regulatory uncertainties, and various interventions by vested interests, have caused inordinate delays in receipt of relevant approvals for the proposed transaction.
Unprecedented competitive intensity in the Indian telecom sector, together with fresh policy directives adversely impacting bank financing for this sector, have also seriously affected industry dynamics. As a result of the various factors aforesaid, the merger agreement has lapsed and the board approved the same.
Shares of Bharti Infratel gained 2.77%. Bharti Infratel is a provider of tower and related infrastructure and is a unit of Bharti Airtel.
On the macro front, the Nikkei India Manufacturing Purchasing Managers' Index, or PMI, stood at 51.2 in September, remaining unchanged from August. September saw a sustained expansion in the Indian manufacturing sector, supported by increases in both output and new orders. However, the rates of expansion eased slightly in both cases. The data was released during market hours today, 3 October 2017.
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