Although in the positive, the Indian indices remained range bound for the larger part of the trading session today. However, buying activity intensified in the final hours and helped the indices to close well above the dotted line. While the BSE Sensex closed higher by around 235 points (up 1.3%), the NSE Nifty gained around 69 points (up 1.3%). The BSE Midcap and the BSE Smallcap also did well to notch gains of 2% each. Gains were largely seen in metals, IT and oil & gas stocks.
As regards global markets, barring China most Asian indices closed in the positive today while European indices have also opened in the green. The rupee was trading at Rs 46.82 to the dollar at the time of writing.
As per reports, the US FDA has issued a warning letter to Sun Pharma with respect to the latter's manufacturing facility in Cranbury, New Jersey, US. This is a follow up to the last inspection of this plant in Feb 2010. Although Sun Pharma intends to respond to these issues within the next 15 days, there is a possibility that no new products from that plant would be approved till the matter is fully resolved. It may be noted that Sun Pharma's subsidiary Caraco had already run into trouble with the US FDA in FY09 as a result of which sales from the US were considerably impacted in the last two years. In another development, which is on the positive side, the company has received approval to market generic 'Strattera' capsules. Sun Pharma has received 180-days exclusivity for the same which will mean that it will generate higher revenues and profits from this drug. The drug is in 6 strengths and is indicated for the management of attention deficit hyperactivity disorder in children aged 6 and older, teens and adults. It has annual sales of US$ 530 m. The stock closed lower today.
Auto stocks closed mixed today. While Force Motors, TVS Motor and Tata Motors recorded gains, Hero Honda and M&M were at the receiving end. As per a leading business daily, Tata Motors reported robust sales for the month of July. Sales grew by 32% YoY to 65,938 units during the month. Both the domestic market and exports contributed to this growth. While the company's total passenger vehicles in the domestic market grew by 45% YoY, exports grew by 92% YoY. As far as the brands are concerned, while 'Indigo' grew by a dazzling 151% YoY, 'Sumo' and 'Safari' registered growth of 11% YoY. With respect to commercial vehicles, light commercial vehicles saw a growth of 11% YoY, while the growth of medium and heavy commercial vehicles stood at 34% YoY.
India continued to report strong growth in exports. For July, exports grew by 13.2% to US$ 16.2 bn representing growth for the nine month in a row. However, imports too rose by 34% to US$ 29 bn. Oil imports in July grew by 4.4% to US$ 7.6 bn, while non-oil imports jumped by 49.6% to US$ 21.5 bn. As a result, the country's trade deficit widened to US$ 12.9 bn in July. The growth in exports, however, is an encouraging sign. It must be noted that the global economic slowdown badly hit Indian exports . However, once the recovery in exports began in November 2009, there has been no looking back.