Indian share markets continued their momentum during closing hours of trade and ended the day on a positive note. Gains were largely seen in the energy sector, telecom sector and banking sector.
Both, the Senses and Nifty, ended their day at record closing highs. At the closing bell, the BSE Sensex stood higher by 222 points (up 0.6%) and the NSE Nifty closed higher by 61 points (up 0.5%). The BSE Mid Cap index ended the day up by 0.2%, while the BSE Small Cap index ended the day flat.
Asian stock markets finished on a mixed note as of the most recent closing prices. The Hang Seng stood up by 0.39% and the Nikkei was trading down by 0.08%. The Shanghai Composite stood lower by 1.25%.
European markets were trading on a positive note. The FTSE 100 was up by 0.84%. The DAX, was up by 0.32% while the CAC 40 was up by 0.10%.
The rupee was trading at 68.62 to the US$ at the time of writing.
Speaking of rising markets, In June 2016, when Sensex was trading at around 27,000 mark, Tanushree shared with her subscribers a report on why Sensex could go up to 40,000.... And the four safe stocks that one could count on to create permanent wealth.
Sensex is close to that mark now. But the way Tanushree sees things now, the Sensex is on its way to hit 100,000 mark by the next decade.
That said, she believes it's not going to be a continuous joy ride. In fact, a majority of these gains will be led by stocks outside of the Sensex.
In the news from the pharmaceuticals sector, Lupin share price was in focus today as the company reported a 44% year-on-year (YoY) decline in net profit at Rs 2,028 million for the quarter ended June.
Total income during the quarter grew 3.6% YoY to Rs 40 billion.
The subdued performance was primarily seen on the account of lower sales in the US and Japan. Sales in North America, the company's largest market, fell 26%.
Also, a rise in tax rate to 47% from 21% in the corresponding quarter also hit earnings.
At the closing bell, Lupin share price stood down by 4.5% on the BSE.
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.
In news from the Mphasis share price was also in focus today. Shares of the company witnessed selling pressure as the company's board approved a proposal to buy back shares worth of up to Rs 9.8 billion.
It also said that promoters of the company have intentions to participate in the buyback and the buyback of shares will be done at a maximum price of Rs 1,350 per share.
Mphasis share price closed the day down by 3.5% on the BSE.
Speaking of buybacks, the number of buyback offers in 2017-18 were at an all-time high. Never, in the last two decades, Indian markets saw fifty-nine companies announcing buyback plans.
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