Indian share markets gained momentum in the final hour of trading to end the day on a strong note. At the closing bell, BSE Sensex ended up by 373 points, while, NSE Nifty ended up by 102 points.
Sectoral indices ended on a mixed note with healthcare stocks, and metal stocks witnessing maximum selling pressure. While, FMCG stocks and bank stocks ended in green.
Globally, Asian stock markets finished mixed as of the most recent closing prices. The Hang Seng gained 1.7% and the Nikkei 225 rose 0.8%. The Shanghai Composite lost 0.1%. European markets are sharply higher today with shares in France leading the region. The CAC 40 is up 1.3% while Germany's DAX is up 1.2% and London's FTSE 100 is up 1.1%.
The rupee was trading at Rs 70.70 against them in the afternoon session.
In the news from pharma space, Alembic Pharmaceuticals share price was in focus today as the company's joint venture Aleor Dermaceuticals has received approval from the US health regulator for Xylocaine ointment, used for temporary relief of pain associated with minor burns, including sunburn, abrasions of the skin and insect bites.
The company in a filing said that it has received approval from the US Food and Drug Administration (USFDA) for its abbreviated new drug application (ANDA) Lidocaine ointment USP, 5%.
Speaking of pharma sector, note that 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.
And since then it has been a painful ride downwards, as can be seen from the chart below:
The Roller Coaster Ride of the BSE Healthcare Index
As we wrote in one of our editions of The 5 Minute WrapUp...
- 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. Sun Pharma received a warning letter for its Halol manufacturing facility in 2015. It was like a bolt out of the blue. Since then, the downward spiral began and has continued till date.
We believe that pharma companies that invest in creating a pipeline of complex generics or building competencies in alternative dosage forms are better equipped to tackle the changing dynamics in the US generics market as well as in the overall industry.
Moving on to the news from the aviation sector, Jet Airways share price was in focus today. The stock of the company witnessed buying interest on reports that founder-chairman Naresh Goyal is going to have in Etihad Airways to further invest in its equity in a bid to overcome the financial crisis the airline is witnessing.
The company had last week stated that it is in talks to secure sustainable financing for its operations and growth.
Note that last month reports stated that Jet Airways is trimming its workforce and operations further as it struggles through its financial crisis.
As per a leading financial daily, at least 15 people at manager or general manager level in departments such as engineering, security and sales have been asked to leave in October. It is also reported that the airline has grounded eight of its planes at the Mumbai and Chennai airports.
The company had also deferred announcing the June quarter numbers to an unspecified late date.
Amid rising concerns over the airline's financial health and proposed salary reductions for employees, Jet Airways chairman said a new committee would be set up to improve public perception.
Later, the company reported a whopping Rs 13.2 billion of net losses for the June quarter due to higher fuel cost, falling rupee and low fares. The company said it will monetize loyalty programme JetPrivilege and wet-lease some of its small aircraft to mobilise urgent working capital.
This was the second straight quarter of losses for the Naresh Goyal-run airline, which had last month publicly admitted to cash-flow issues. The airline had booked a net profit of Rs 535 million in the year-ago period, while in the March quarter it had reported net losses of Rs 10.4 billion.
The airline said its fuel cost soared 53% to Rs 23.3 billion in the quarter, while low fares had revenue inching up to Rs 60.7 billion from Rs 59.5 billion.
On a consolidated basis, the net loss stood at Rs 13.3 billion, against a net profit of Rs 580 million a year ago.
The second back-to-back quarterly loss forced Jet Airways, which delayed the result announcement on August 9 indefinitely, to announce a turnaround plan which includes a capital infusion by selling a stake in JetPrivilege, and a massive cost-cutting to save around Rs 20-billion over the next two years.
To know more about the company, you can access to Jet Airways' latest result analysis and Jet Airways' 2017-18 Annual Report Analysis on our website.
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