Sensex, Nifty extend gains; Hero, Bharti Airtel, Sesa slip

10:59am Hero Motocorp block deals

Around 3.5 percent equity (71 lakh shares) of Hero Motocorp changed hands on exchanges through multiple block deals at Rs 2664-2718 apiece.

Currently promoter holds 39.9 percent stake in company.

10:45am Coal auction

Companies participating in the coal block auctions continue to be in focus. The latest results included BALCO winning the Chotia block in Chattisgarh at a price of Rs 3,025 per tonne whose previous owner was Prakash Industries, Jaiprakash Associates winning the Mandla North block, JP Power winning the Amelia North Coal block and OCL Iron & Steel winning Ardhagram coal block.

Brokerages such as JP Morgan say there have been aggressive bids for power and non power so far and expect aggressive bidding for the key Gare Palma coal block.

Jaiprakash Associates rallied 4 percent, Jaiprakash Power Ventures up 11 percent and OCL Iron shot up 17 percent.

10:30am Prime Minister says

Prime Minister Narendra Modi said the government did not want India to be the biggest importer of defence equipment in the world, and vowed to double output of defence manufacturing in the country.

India’s annual defence import bill is roughly USD 20 billion. In contrast, India’s domestic defence production output is around USD 7 billion.

Modi said even a 20-25 percent decrease in defence import can create 2 lakh  jobs in the country. Also, a 25 percent hike in domestic defence output can create 1 lakh skilled jobs, he said.

Modi said the government was keen to expand the role of private sector for Indian defence production and that preference would be given to defence products made locally.

10:00am Market Check

The market extended gains with the Sensex rising 163.37 points to 29299.25 and the Nifty climbing 39.85 points to 8849.20. The broader markets outperformed benchmarks as the BSE Midcap and Smallcap indices gained 0.6 percent and 0.9 percent, respectively.

Two shares advanced for every share declining on the Bombay Stock Exchange.

Predicting the market movement in the short-term is always a challenge and dicey, says Dipen Sheth, head of institutional research at HDFC Securities. But on the brighter side, he says big money has started flowing into domestic mutual funds. He is constructive on the market.

Hero Motocorp fell over 4 percent. According to sources, promoters of the two-wheeler manufacturer will sell 3.5 percent or 70 lakh shares of their 40 percent stake in the company via block deal today. It is learnt that the price band is decided at Rs 2664-2720 per share. Promoters are likely to raise around USD 300 million via the stake sale, say sources.

Bharti Airtel, Sesa Sterlite and Bajaj Auto declined 1-1.8 percent. Tata Motors slipped 0.7 percent as JLR global wholesales declined to 36,527 in January against 38,631 units sold in the year-ago period.

Technology stocks like TCS, Wipro and Infosys were down around 0.4 percent each. However, shares of HDFC, ITC, ICICI Bank, L&T, M&M, HUL, Sun Pharma, NTPC, Tata Power and GAIL gained 1-2.6 percent.