BSE Sensex rebounds post carnage, up 55; Infosys, ONGC lead

Equity benchmarks closed rangebound session with marginal gains on Friday, after previous day's carnage on rupee depreciation. The recovery was not only seen in equity markets, but also in commodities.

The BSE Sensex rose 54.95 points to close at 18774.24, after a 526 points fall in previous session. The NSE Nifty gained 11.75 points to finish at 5667.65.

Meanwhile, the Indian rupee also appreciated by 29 paise to 59.27 per dollar. It had fallen 1.5 percent Thursday to close at record low of 59.57 per dollar after Federal Reserve chairman Ben Bernanke said if the economy continues to improve the asset-purchasing program could start winding down towards the end of 2013 and wrap up in 2014.

Experts say the recovery could not sustain for long. They expect further fall from current levels due to rupee depreciation.

Girish Nadkarni of Avendus Capital says there is distinctly a possibility that the Nifty will fall below the 5600 level.

He sees more selling pressure in banking space, which has a significant weight in the Nifty and the BSE Sensex. ''With interest rate yields going up there will be some amount of pressure on banks. In the medium-term you will find credit quality also deteriorating further from now and therefore we could see the equity markets going down,'' he reasons.

For the week, both equity benchmarks fell more than two percent while CNX Midcap declined 2 percent and Smallcap slipped 1 percent.

Shares of Infosys, Bharti Airtel, Dr Reddys Labs and Maruti Suzuki rallied more than 2 percent.

Oil and Natural Gas Corporation (ONGC) shares rose 2.56 percent, after Deutsche Bank recommended buying the stock with a target price of Rs 395. Finance minister P Chidambaram after the CCEA meeting, said the cabinet would take up gas price issue in CCEA next week.

Jindal Steel & Power (JSPL) shares slumped 8 percent. In the latest on the Coal scam, the Central Bureau of Investigation (CBI) has sent notice to four Jindal group companies, including JSPL, to join the probe, reports CNBC-TV18 quoting sources. JSPL promoters bought 4.5 lakh shares in the company that led support to the stock in late trade; it has fallen nearly 12 percent to touch a 4-year low of Rs 19.

Hindalco Industries dropped 4 percent while banks and FMCG stocks also declined.

Index heavyweight Reliance Industries declined 0.66 percent at close, which was the gainer in afternoon trade.

The Cabinet Committee on Economic Affairs (CCEA) has decided today to allow power companies to pass on the costs of imported coal to customers. Immediately after the news, power stocks gained 1-3 percent, but all could not sustain their gains towards close. Only NTPC stayed on buyers' radar with 2 percent gain.

The BSE Midcap Index lost 1.3 percent and Smallcap was down 0.36 percent, as declining shares outnumbered advancing ones by 1330 to 979 on the Bombay Stock Exchange.

3:50 pm Winners and losers: ONGC , Infosys , NTPC , Dr Reddys Labs and Maruti Suzuki are biggest gainers of the day. Jindal Steel , Hindalco , Sun Pharma , Sterlite Industries, Reliance are top losers in the Sensex.

3:40 pm Gold update: Continuing its slide for the third straight day, gold prices fell sharply by Rs 620 to trade at two-week low of Rs 27,380 per ten grams on persistent selling by stockists.

Silver too remained under pressure and plummeted by Rs 1,400 to Rs 41,700 per kg on lack of buying support from industrial units and coin makers.

Traders said persistent selling by stockists in line with a weakening global trend after Federal Reserve Chairman Ben Bernanke signalled that the central bank may start curbing stimulus programme this year, mainly dragged gold and silver prices down.

Besides, sluggish demand in the spot markets due to off-marriage season also weighed on gold prices, they said.

3:30 pm Market closing: The Sensex ends up 41.93 points at 18761.22, and the Nifty up 11.75 points to be at 5667.65.

3:20 pm PM's assurance: There is no need to react and panic over the rupee's fall, Finance Minister P Chidambaram said on Friday, a day after the Indian unit it an all-time low against the dollar, reports Reuters.

The rupee had slumped to a record low of 59.9850 to the dollar on Thursday, following the US Federal Reserve's statement on its plan to wind down the monetary stimulus.

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It is listless trading as the market prepares to close for the weekend. The Sensex is down 37.45 points at 18681.84, and the Nifty is down 12.60 points to be at 5643.30. About 875 shares have advanced, 1376 shares declined, and 136 shares are unchanged.

Metals and realty stocks are under heavy selling pressure. Technology stocks, meanwhile, are shining in the index today.

The rupee gains sharply, coming off lows since morning, at 59.23/25 versus Thursday close of 59.57/58. Dealers cite dollar inflows related to Essar Steel's USD 1 billion overseas borrowing, reports Reuters.

02:40pm Benchmark indices are volatile in late trade while the broader markets extended losses. Declining shares outpaced advancing ones by 1377 to 870 on the Bombay Stock Exchange.

The BSE Midcap Index fell 1.7 percent and Smallcap Index declined 0.75 percent.

Indian debt market should brace for further outflows to the tune of USD 2-3 billion over the next one month says, Sandeep Bhatia, Kotak Institutional Equities, in an interview to CNBC-TV18. India has already seen an outflow of USD 4.8 billion in the past few months.

The morbid newsflow can worsen as Bhatia foresees the declining rupee going all the way to 62/USD in the face of limited options left for Reserve Bank of India (RBI) to stem the fall. The market will naturally be hit and 5200 on the Nifty can easily be seen , he says.

Karnataka Bank crashed more than 16 percent followed by Bombay Dyeing , Apollo Tyres and Vijaya Bank with 8-9 percent losses.

Among smallcaps, Goenka Diamond, Jyoti Structure , NCC and Titagarh Wagons lost 7-12 percent.

Tthe floor price for the foseco india offer for sale has been set at 450 rupees a share, a discount to its current market price of 470 rupees.

02:20pm Reliance Communications is under pressure for the second consecutive session on profit booking, losing more than 4 percent. It rallied 20 percent in previous four sessions.

Apollo Tyres failed to sustain its previous day's upmove. The stock plunged 10 percent today, after a percent gains on Thursday. Earlier, the stock had plunged 33.8 percent when the company announced to buy US-based Cooper Tire for Rs 14,500 crore as analysts feel the company would not digest such a big acquisition. Many analysts recommends staying away from the stock for one year at least.

02:10pm Equity benchmarks slipped again amid choppy trade, with the Nifty trading below the 5650 level. Index heavyweights Reliance Industries and ICICI Bank fell 1.2 percent each.

The BSE Sensex is down 60 points at 18659.29, and the Nifty is down 24.60 points at 5631.30.

Sun Pharma shares lost 2 percent and Hindalco Industries plunged 4 percent.

Future Retail shares crashed 40 percent as the stock is quoting ex-scheme of demerger Friday. The company demerged its fashion business in November 2012 and formed a new company called Future Lifestyle Fashions (FLFL).

Karnataka Bank is the second biggest midcap loser, falling nearly 15 percent to Rs 118 apiece followed by Vijaya Bank with 8.5 percent losses.

Jindal Steel & Power slumped around 11 percent. In the latest on the Coal scam, CNBC-TV18's sources indicate that the CBI has sent notice to four Jindal group companies, including JSPL, to join the probe.

1:47 pm Update: The floor price for the Foseco India offer for sale has been set at Rs 450 a share. The stock is down 2.2  percent.

1:40 pm Macro outlook: Former deputy Reserve Bank governor and currently research director at Brookings India Subir Gokarn said the proposed unwinding in quantitative easing may unleash adjustments in markets, following which attracting foreign funds may pose a challenge.

Speaking to CNBC-TV18, Gokarn said the government needs to take credible steps to tackle deficit, which will help rupee and sentiment in market. Meanwhile, Indian bond prices have fallen further and the 10-year bond's yield have risen by another three basis points to 7.42 percent on suspected FII selling; sentiment is also weak ahead of an auction today and because rate cut hopes have all but vanished. Gokarn, however, said that the RBI may still find elbow room to cut rates in its next policy.

1:30 pm Losers: Jindal Steel & Power slumps around 11%. In the latest on the Coal scam, CNBC-TV18's sources indicate the CBI has sent notice to four Jindal group companies, including JSPL, to join the probe.

1:20 pm Banker's talk: Taking a dig at teaser rate products HDFC chairman Deepak Parekh cautioned borrowers of its risk factors . Customers need to be cautious of "too-good-to-be-true" type of products, he said in the company's annual report addressed to shareholders.

"To my mind, teaser products, of any nature entail risks. Borrowers must not be blinkered into believing that there are no risks when developers offer to pay interest on a borrower's loan for a specified period. Borrowers have to be cautious because in the event of a developer delaying payment, the credit bureau reports will reflect this in the borrower's records, thereby impacting his or her creditworthiness," he explained.

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Rupee rout: Govt has no choice but to have a long term plan

The market picks up in afternoon trade as the Nifty is inching closer to 5700 led by power, infra and capital goods. The Sensex is up 84.80 points at 18804.09, and the Nifty up 22.40 points at 5678.30. About 1108 shares have advanced, 961 shares declined, and 139 shares are unchanged.

The mid and small caps too recover from early lows.

Power stocks rallied 1-3 percent in afternoon trade Friday, after the cabinet committee on economic affairs (CCEA) has decided to allow power companies to pass on the costs of imported coal to customers.

This move is likely to boost imports and investment in power generation, but increasing energy prices for consumers.

A proposal to raise gas prices has been deferred, information and broadcasting minister Manish Tiwari told reporters after a cabinet meeting.

India is the world's third-largest producer of coal and more than half the country's power comes from burning the fuel, but domestic output falls short of demand, triggering frequent and lengthy power cuts in Asia's third-largest economy, reports Reuters.

Shares of Adani Power and Tata Power rose nearly 3 percent while CESC , NTPC , Reliance Infrastructure and Reliance Power gained more than one percent.

Globally Asian markets too rebound from early lows. The Japanese markets stage a 1 percent plus turnaround and Europe opens positive. In other asset classes, gold and Brent crude stabilise after the sharp cuts in early trade.

12:50pm Gold recovered from a three-year trough on Friday as lower prices attracted Chinese buyers and as Asian stocks fell, but the metal was still headed for its worst week in nearly two years after the Federal Reserve said it would curb stimulus, reports Reuters.

Gold for immediate delivery dropped over 5 percent on Thursday, along with other commodities and global stock markets, a day after Fed Chairman Ben Bernanke said the US economy was strong enough for the bank to wind down its bond-buying programme.

Spot gold rose 1.5 percent to USD 1297.01 an ounce.

Back home, oil & gas, technology, capital goods, auto and telecom stocks are on buyers' radar. HDFC Bank and State Bank of India too gained.

The rupee opened lower and reversed direction as the stock markets recovered and dealers said the RBI was supplying dollars in early trade to meet FII demand.

12:35pm European markets bounced back after yesterday's sharp fall on Federal Reserve's hawkish tone. France's CAC, Germany's DAX and Britain's FTSE gained 0.4-0.7 percent.

Indian rupee appreciated further, gaining 42 paise to 59.15 per dollar. "The Reserve Bank of India seems to have intervened in foreign exchange market to stem rupee fall, says Ashutosh Raina, Head of FX trading at HDFC Bank.

According to him, the recovery in rupee may be due to unwinding of long positions. "58 per dollar seems to be comfortable level for in immediate-term," he adds.

Gold and silver gained 1.7 percent each in international market.

The BSE Sensex is up 98.87 points at 18818.16, and the Nifty is up 29.10 points at 5685.

12:20pm Bajaj Hindusthan gained nearly one percent as the board of directors of the company approved a sale of investments in Bajaj Energy Private Limited and Bajaj Hindusthan (Singapore).

Debabrata Sarkar, CMD of Union Bank says the bank expects to maintain non-performing assets (NPAs) at same levels as last quarter. "The process of NPA reduction is on; we hope to maintain it below 3 percent levels," he adds.

12:10pm Indian equity benchmarks are trading flat-to-positive in afternoon trade, helped by capital goods, oil & gas and technology stocks. Indian rupee too recovered, appreciated by 27 paise to 59.30 per dollar.

The BSE Sensex is up 79.66 points at 18798.95, and the Nifty is up 22.55 points at 5678.45. Advancing shares outpaced declining ones by 1047 to 900 on the Bombay Stock Exchange.

Neyveli Lignite  shares rallied 6.5 percent, after the cabinet committee on economic affairs approved a 5 percent stake sale in the company.

India has decided to allow power companies to pass on the costs of foreign coal to customers, a minister said, a move likely to boost imports and investment in power generation, but bringing higher energy prices to consumers, reports Reuters.

A proposal to raise gas prices has been deferred, information and broadcasting minister Manish Tiwari told reporters after a cabinet meeting.

11:55 am Index check: IT and oil & gas stocks are rallying today on weak rupee, while banking and metal stocks are laggards.

11:50 am Buzzing: Macquarie is likely to acquire stake in Prime Focus' subsidiary, reports CNBC-TV18 quoting sources. The deal is going to be announced today. The stock is up 2.8 percent on the BSE.

11:40 am OMCs update: Under-recoveries from oil marketing companies (OMCs) is likely to jump to Rs 1.20 lakh crore from Rs 80,000 crore in FY 14, reports CNBC-TV18 quoting sources.  It is learnt that FY14 under-recoveries set to rise due to rupee depreciation. Every Re 1 depreciation hikes under-recovery by R 9,000 crore and every Re 1 depreciation hikes diesel under-recovery by 78p, say sources.

11:30 am Buzzing: Future Retail shares plunged 25 percent as the stock is quoting ex-scheme of demerger from Friday. The company demerged its fashion business in November 2012 and formed a new company called Future Lifestyle Fashions (FLFL).

FLFL has a portfolio of over two dozen fashion and lifestyle brands.

Future Retail has fixed a record date as June 24, 2013 for determining share entitlement to shareholders of the company.

11:27 am Rupee outlook: Indian rupee's weakness reflects domestic economic challenges, primarily a high current account deficit (CAD) and lower capital flows, but does not significantly impact India's foreign debt repayment capacity, Moody's said on Friday.

"Given the very low level of foreign currency debt owed by the Indian government, rupee depreciation does not significantly affect sovereign debt repayment capacity," said Atsi Sheth, vice-president of the sovereign risk group at Moody's Investors Service, in an e-mailed response to Reuters.

11:20 am Gold recovers: Gold recovered from a three-year trough on Friday as lower prices attracted Chinese buyers and as Asian stocks fell, but the metal was still headed for its worst week in nearly two years after the Federal Reserve said it would curb stimulus, reports Reuters.

Gold for immediate delivery fell over 5 percent on Thursday, along with other commodities and global stock markets, a day after Fed Chairman Ben Bernanke said the US economy was strong enough for the bank to wind down its bond-buying programme.

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It's a flat Friday. The Nifty is trading above 5650 led by select rate sensitive, technology and oil & gas stocks. The Sensex is up 20.87 points at 18740.16, and the Nifty is up 4.70 points or 0.08% at 5660.60. About 964 shares have advanced, 800 shares declined, and 121 shares are unchanged.

The mid and small caps too recover from their early lows. Mohammed Appabhai of Citi warns that the outlook for India is still fairly negative as the outflows so far have been relatively small and the rupee is seen under pressure for a while.
 
The rupee has been below yesterday's closing of 59.57 per dollar on incessant dollar buying by foreign funds who may be pulling out of Indian debt. However, a steeper fall in the rupee has been averted by RBI's supply of dollars through PSU banks

Dollar strengthens further to 81.7. Euro stays above 1.32, yen at 97, emerging market currencies are under pressure with Brazilian real down 1.5 percent, Russian ruble down 1.9 percent from its previous close.

Indian bond prices fell further and the 10 year bond's yield rose by another 3 basis points to 7.42 percent on suspected FII selling.

10:55am Hero Motocorp gained 1.76 percent, after Bank of America Merrill Lynch upgraded the stock to 'buy' from 'underoerform' and raised a target price to Rs 2,030 from Rs 1,595 earlier. The upgrade is based on the back of 3 percent increase to their FY14 EBITDA forecast.

Future Retail shares plunges 22 percent after the stock goes ex-scheme of arrangment today. The company demerged its fashion business and formed a new company Future Lifestyle Fashions.

Future Retail has fixed a record date as June 24, 2013 for determining share entitlement to shareholders of the company.

The shareholders will receive one equity share of Rs 2 each of Future Lifestyle Fashions (FLFL) for every three equity shares of Rs 2 each held in the company.

10:45am Neyveli Lignite is down 2 percent, as the cabinet is expected to take up the proposal to sell government's 5 percent stake in company, which would help garner around Rs 450 crore to the exchequer.

LIC Housing Finance extended gains to 1.65 percent as the company will apply for a banking license after the board cleared a proposal for the same.

Mahindra Ugine is locked at 5 percent upper circuit. The stock rallied 65 percent since June 15th when the deal with Spanish company, CIE Automotive signed. The open offer for Mahindra Forgings by CIE will begin on August 5.

10:30am Equity benchmark indices bounced back after previous day's carnage, supported by oil & gas, telecom and technology stocks.

Dealers say the market may not sustain any bounce for long as every bounce may be sold into.

Shares of Infosys , Reliance Industries , TCS , ONGC and Bharti Airtel gained 1-1.6 percent.

Deutsche Bank has a buy rating on ONGC with a stoploss at Rs 395. "Based on the Rangarajan formula, the average annual price is likely to be close to USD 8 a barrel from FY15. If gas prices are raised by USD 4 a barrel, our target price and valuation for the stock will jump by more than 35%," Deutsche Bank report said.

10:25am Oil marketing companies' under-recoveries forecast has been increased from Rs 80,000 crore to Rs 1.20 lakh crore due to rupee depreciation, reports CNBC-TV18 sources.

Every one rupee depreciation hikes under-recovery by Rs 9,000 crore while every one rupee depreciation hikes diesel under-recovery by 78 paise.

Jindal Steel topped the selling list, continuing its downtrend for the second consecutive session today. The stock lost more than 3 percent.

Future Retail is the major loser among midcaps, falling nearly 19 percent followed by Vijaya Bank with 6 percent losses.

10:15am Indian equity benchmarks remain volatile amid marginal selling pressure, tracking weak global cues. Indian rupee depreciated by 10 paise to 59.67 per dollar Friday.

The BSE Sensex is down 33.73 points at 18685.56, and the NSE Nifty is down 13.05 points at 5642.85.

The broader markets too are under pressure as declining shares outnumbered advancing ones by 698 to 348 on the National Stock Exchange.

Unilever's USD 5.4 billion voluntary open offer to increase its stake in Hindustan Unilever ( HUL ) begins today, and will remain open till July 4. In a statement from London, the company said the open offer price is fixed at Rs 600 apiece, but added that the company will offer a Rs 6 bonus per share.

Currently, Unilever holds 52.48 percent in HUL and post open offer it will go up to 75 percent.

The stock declined 0.44 percent to Rs 590.55 on the Bombay Stock Exchange.

Reliance Capital has suspended sale of gold in physical form and also as an investment product, to curb gold imports. The stock is down 0.3 percent.

"We strongly supports the government's publicly stated objective of minimising gold imports thar are seriously hurting the country's economic interests," Reliance Capital said.

Asian stocks hit a fresh 9-1/2-month low today while spot gold slipped to its lowest price in nearly three years as the US Federal Reserve's plan to scale back stimulus continued to worry investors.

But China's central bank offered some comfort to stressed money markets, relieving Thursday's crushing liquidity squeeze with "window guidance" to major state banks to resume supplying funds, after indicative interbank rates reached highs above 25 percent on Thursday.

9:50 am HUL open offer: Unilever's voluntary open offer to increase its stake in Hindustan Unilever begins today, and will remain open till July 4. In a statement from London, the company said the open offer price is fixed at Rs 600 apiece, but added that the company will offer a Rs 6 bonus per share.

Currently, Unilever holds 52.48 percent in HUL and post open offer it will go up to 75 percent.

9:45 am Gold update: Gold fell to a three-year low on Friday and was in danger of recording its biggest weekly drop in 30 years after the US Federal Reserve said it would wind down its bullion-friendly stimulus later this year, reports Reuters.

Spot gold - down nearly 9 percent this week - dropped for the fifth straight session, while Comex gold futures also declined over 1% to their lowest in three years.

Fed chairman Ben Bernanke said on Wednesday the central bank would taper its USD 85 billion monthly bond buying programme as the US economy was recovering strongly, ending purchases around mid-2014 if economic growth held up.

9:40 am Expert take: The market could bounce on short covering, but investors would be better off not buying into the rally, feels Ajay Srivastava of Dimensions Consulting. If at all investors want to buy equities in this market, they should focus on companies with dollar-denominated earnings, says Srivastava. He is bullish on Divis Labs , Oracle Fin, and Tech Mahindra .

In an interview to CNBC-TV18 , he says it would be at least a couple of years before the macro-economic environment normalises. He says the RBI may even be compelled to raise rates in its efforts to protect the rupee. At the same time, given the chaos in global markets, there is little the Indian government can do on its own.

9:37 am Market check: The Sensex slips 99.73 points to 18619.56, and the Nifty is down 37.55 points to be at 5618.35.

9:30 am Winners and losers:  Infosys , Bharti Airtel , Reliance and BHEL are major gainers in the Sensex. Meanwhile, Jindal Steel is still down 4.6 percent and Hindalco slips 1.9 percent in the Sensex.

Read Udayan Mukherjee's comments Global mkts in selling exhaustion mode; Nifty may fall 3-5%

After getting hammered down on Thursday, the market opens on a soft note even today. The Sensex is down 67.14 points at 18652.15 while the Nifty slips16.75 points to 5639.15. About 156 shares have advanced, 269 shares declined, and 26 shares are unchanged.

On Friday, the Indian rupee opened lower by 23 paise at 59.80 per dollar as against previous day's closing of 59.57 Thursday.

The dollar gained on the prospect of an end to super-easy money from the Federal Reserve. The euro was above 1.32 to the dollar. The dollar index is above 81.50 level. Back home, the rupee ended at an all-time closing low of 59.57 per dollar.

The US markets slid after the Federal Reserve chairman Ben Bernanke hinted the central bank may scale back its asset purchases later this year. With the declines from the last two sessions, the Dow and S&P 500 wiped out all of their gains from May and June. The dow is down more than 5 percent since its May closing high.

US treasury yields rallied to new 52-week highs.

Brent crude plummeted to USD 102 per barrel. From precious metals space, gold plunged 5 percent, its lowest level since October, 2010. Silver too slipped 8 percent, below 20 for first time since September 2010.