Key indices are trading firm in early trade on positive Asian cues. At 9:25 IST, the barometer index, the S&P BSE Sensex, was up 329.20 points or 0.85% at 39,183.75. The Nifty 50 index was up 88.10 points or 0.77% at 11,552.55.
The S&P BSE Mid-Cap index was up 1.25%. The S&P BSE Small-Cap index was up 2.7%.
The market breadth, indicating the overall health of the market, is strong. On the BSE, 1403 shares rose and 314 shares fell. A total of 79 shares were unchanged.
To achieve the desired objective of True to Label and Appropriate Benchmarking, SEBI issued a circular dated 11 September 2020 on Multi Cap schemes of Mutual Funds, requiring them to invest a minimum of 25% each in Large, Mid and Small Cap stocks, with the balance 25% giving flexibility to the fund manager.
In its clarification on 13 September 2020, SEBI said that Mutual Funds have many options to meet with the requirements, based on the preference of their unitholders. Apart from rebalancing their portfolio in the Multi Cap schemes, they could inter-alia facilitate switch to other schemes by unitholders, merge their Multi Cap scheme with their Large Cap scheme or convert their Multi Cap scheme to another scheme category, for instance Large cum Mid Cap scheme.
SEBI is conscious of market stability and therefore has given time to the Mutual Funds till 31 January 2021 to achieve compliance, through its preferred route of which rebalancing of the portfolio is only one such route.
Monsoon Session of Parliament:
The 18-day Monsoon Session of Parliament will begin from today under the shadow of the coronavirus pandemic. The Monsoon Session will see Lok Sabha and Rajya Sabha sitting in two different shifts, while special seating arrangements have been made for MPs in adherence to social distancing guidelines.
On the macro front, India's industrial output contracted 10.4% in July as against a 4.9% growth year-on-year (YoY), data released by the government on 11 September 2020 showed. This is against a 16.6% contraction in the month of June.
Stocks in news:
Tata Motors rose 2.11%. Tata Motors' wholly owned subsidiary, Jaguar Land Rover (UK) said retail sales totaled 36,421 in July and 28,887 vehicles in the seasonally lower month of August. Notably UK retail sales in July and August were up significantly year-on-year, 29.1% and 14.3% respectively.
Mahindra and Mahindra (M&M) rose 1.09%. M&M said that Share Purchase Agreement entered into for sale of 93,15,000 equity shares of Neo Solren (NSPL) held by Mahindra Renewables (MRPL), a step-down wholly owned subsidiary of M&M, to CLP India stands terminated on 10th September 2020.
Ratnamani Metals & Tubes gained 2.95% after the company said it received a domestic order worth Rs 90 crore in carbon steel division of the company for supplying coated CS pipes for oil & gas sector. The order is to be completed between December 2020 to April 2021.
Yes Bank rose 2.53%. Credit rating agency ICRA upgraded its ratings assigned to various debt instruments of Yes Bank on improved liquidity. ICRA said the rating upgrade factors in the sizeable capital raise of Rs 15,000 crore in July 2020, which has resulted in an improvement in the capital ratios of Yes Bank.
Adani Enterprises rose 1.74%. Adani Land Defence Systems and Technologies, a step down subsidiary of Adani Enterprises, has acquired 51% equity of PLR Systems from Fouraces Systems India on 10 September 2020. PLR Systems was incorporated in 2013 and is engaged in the manufacture and supply of indigenously manufactured defence equipment to the Armed Forces countries. PLR Systems has an authorised share capital of Rs 13 crore and paid up share capital of Rs 12.04 crore.
ISGEC Heavy Engineering jumped 5.36%. The company won a Rs 126.50-crore order for a semi-dry circulating fluidised bed scrubbers (FGD) system from Hindalco Industries. The FGD system will be used at one of the Hindalco's 150 MW units at Mahan Aluminium at Singrauli in Madhya Pradesh. The project was won through competitive bidding against other technology providers.
Bharat Heavy Electricals (BHEL) fell 1.06%. On a consolidated basis, BHEL reported a net loss of Rs 893.14 crore in Q1 June 2020, higher than net loss of Rs 218.93 crore in Q1 June 2019. Consolidated net sales tanked 57% to Rs 1,896.57 crore in Q1 June 2020 over Q1 June 2019.
Overseas, Asian stocks are trading higher on Monday, with investors watching shares of Japanese conglomerate Softbank Group following an announcement of its sale of U.K. chip designer Arm to U.S. chip firm Nvidia.
Chipmaker Nvidia has agreed to buy Arm Holdings, a designer of chips for mobile phones, from Softbank in a deal worth $40 billion, the companies announced Sunday. The deal will be for a mix of $21.5 billion in Nvidia stock and $12 billion in cash, including $2 billion payable at signing.
Meanwhile, developments in Japanese politics were also watched as the search for the successor for Prime Minister Shinzo Abe continues. The ruling Liberal Democratic Party is set to hold an election to choose its new leader on Monday.
In US, the Nasdaq Composite Index fell 66.05 points, or 0.6%, finishing at 10,853.55 in another volatile session on Friday on continuing sell-off in tech stocks. The Dow Jones Industrial Average rose 131.06 points, or 0.5%, ending at 27,665.64; while the S&P 500 rose 1.78 points, or 0.1%, to close at 3,340.97.
Apple dropped 1.3% and Amazon fell by 1.9%. Facebook, Alphabet and Microsoft were all down. ByteDance rejected Microsoft's bid to buy TikTok's U.S. operations.
The Labor Department said Friday its U.S. consumer price index rose by 0.4% in August.
The Treasury Department said the federal budget deficit officially surpassed $3 trillion in August, and is on pace to hit $3.3 trillion when the fiscal year ends this month.
Back home, the equity market benchmarks ended with minor gains after a volatile trade on Friday. The barometer index, the S&P BSE Sensex added 14.23 points or 0.04% at 38,854.55. The Nifty 50 index advanced 15.20 points or 0.13% at 11,464.45.
Foreign portfolio investors (FPIs) bought shares worth Rs 1,175.81 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 724.31 crore in the Indian equity market on 11 September, provisional data showed.