Stock markets in India are presently trading marginally higher. Sectoral indices are trading on a mixed note with stocks in the telecom sector and FMCG sector witnessing maximum buying interest.
The BSE Sensex is trading up 104 points (up 0.3%) and the NSE Nifty is trading up 31 points (up 0.3%). The BSE Mid Cap index is trading up by 0.1%, while the BSE Small Cap index is trading down by 0.2%. The rupee is trading at 68.15 to the US$.
In the news from pharma sector, Aurobindo Pharma share price is in focus today. The stock of the company is witnessing buying interest today as the company announced it received final approval from the US Food & Drug Administration (USFDA) to manufacture and market Ertapenem Injection 1 g/vial.
Aurobindo's Ertapenem injection is a generic equivalent of Merck Sharp & Dohme Corp's Invanz Injection. The company in its BSE filing said that the product will be launched in July this year.
Ertapenem injection is used for the treatment of moderate to severe infections caused by susceptible bacteria. It is also indicated in adults for the prophylaxis of surgical site infection following elective colorectal surgery.
With the above development, Aurobindo Pharma now has a total of 371 abbreviated new drug application (ANDA) approvals (338 Final approvals including 17 from Aurolife Pharma LLC and 33 tentative approvals) from USFDA.
At the time of writing, Aurobindo Pharma share price was trading up by 1%.
Speaking of pharma stocks, the BSE Healthcare Index has been on a roller coaster ride in the past few years. The period from 2012 to 2015 saw the index go up more than three times. Since then it has been a painful ride downwards, as can be seen in the chart below:
The Roller Coaster Ride of the BSE Healthcare Index
Pre-2015, pharma companies enjoyed a fairytale ride in the US market. Low labor costs, good chemistry skills, along with efficiency, ensured Indian companies could copy innovator drugs to make generic drugs at a fast pace.
The generic business had lucrative margins for all major pharma players. But the party did not last long. In the quest to supply drugs quickly, they compromised on quality at their manufacturing facilities. No wonder, the US regulatory authority (USFDA) took strict action.
In the news from commodity space, crude oil is witnessing buying interest today. Gains for the commodity are seen on the back of uncertainty over Libyan oil exports, a member of the Organization of the Petroleum Exporting Countries (OPEC).
As per the news, uncertainty around Libyan oil exports come as Eastern Libyan commander Khalifa Haftar's forces have handed control of oil ports to a separate National Oil Corporation (NOC) based in the East of the country. As per him, the official state-owned oil company based in the capital Tripoli, also called NOC, will not be allowed to handle that oil anymore. Haftar's Libya National Army (LNA) said that no tanker would be allowed to dock at eastern ports without permission from a NOC entity based in the main eastern city, Benghazi.
The above development came after OPEC together with a group of non-OPEC partners including top producer OPEC announced a supply rise of around 1 million barrels per day (bpd) aimed at cooling oil markets.
Note that crude oil price have been following a rising trend lately. In the past one year alone, oil prices have surged more than 50%.
Rising crude oil prices not only affect fuel prices but also has many other repercussions for the Indian economy.
Apart from that, what does rising crude oil prices mean for stock markets?
How the government handles this situation of rising crude oil and fuel prices remains to be seen. Meanwhile, we will keep you posted on all the developments from this space. Stay tuned.
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