Nifty closes below 6150; HUL falls 2% ahead of Q2 nos

Benchmark indices continued to struggle for direction Friday as buyers are beginning to feel that the market may have got ahead of itself.

The sluggish trend in global markets too added to the cautious mood.

The Sensex closed at 20683.52, down 41.91 points over its previous close while the Nifty fell 19.45 points to 6144.90.

Better-than-expected quarterly earnings from key companies have helped the market sustain its recent gains, but players fret that most of the positive news may have already been factored in.

ICICI Bank 's second quarter earnings met analyst estimates , but CEO Chanda Kocchar warned that asset quality would continue to be under pressure. The bank wrote off Rs 560 crore of loans during the quarter, restructured Rs 1076 crore of loans, and said that the sector may not yet have seen the worst of bad loan pile up.

ICICI Bank stock closed flat at Rs 1,021.65 a share.

ITC's net profit rose 21.5 percent higher-than-expected compared to a year ago period to Rs 2,230 crore during September quarter, but net sales increased 8.9 percent (lower than analysts' expectations) Y-o-Y to Rs 7,780 crore for the quarter. The stock fell 0.7 percent.

Hindustan Unilever dropped over 2 percent ahead of its second quarter earnings on Saturday.

Earlier, brokerage house Deutsche Equities raised its year-end target for the Sensex to 22,000 from 21,000, on hopes of the local economy stabilizing and of a longer period of easy monetary policy in the US.

''We replace IT services with banks as our biggest portfolio overweight. Three key themes investors should focus on (1) currency stabilzation (2) rural demand recovery and (3) global growth,'' the Deutsche Bank note said.

Capital goods, metals, healthcare and telecom stocks were under pressure while technology stocks bucked the trend with TCS gaining 3 percent.

3:50 pm Market closing: After a very volatile session, the Sensex ended 41.91 points down at 20683.52. The Nifty slipped 19.45 points to close at 6144.90. About 1038 shares have advanced, 1386 shares declined, and 159 shares are unchanged. ITC closed down 0.7 percent on the BSE.

3:40 pm results: Pharmaceuticals major Wockhardt reported 69.46 per cent decline in its consolidated net profit for the second quarter ended September 30, 2013 at Rs 138.50 crore, reports PTI.

The company had posted a consolidated net profit of Rs 453.55 crore in the same quarter last fiscal, Wockhardt Ltd said in a filing to the BSE. Net sales during the period under review stood at Rs 1,196.97 crore as against Rs 1,347.44 crore in the year-ago quarter

3:30 pm Results: ITC's Q2 net profit grew 21.5 percent year-on-year to Rs 2,230 crore. Net sales rose 8.9 percent to Rs 7,780 crore in three months period ended September 2013 from Rs 7,146 crore in a year ago period.

According to a CNBC-TV18 poll, analysts on an average had expected the company to report net profit of Rs 2,115 crore on revenues of Rs 8,140 crore for the quarter.

3:20 pm Alert: With the FIPB giving approval to the Tata-Singapore Airlines joint venture to start a full-service carrier, Tata Group Chairman Emeritus Ratan Tata today met Commerce and Industry Minister Anand Sharma, reports PTI. Tata was accompanied by Singapore Airlines (SIA) CEO Goh Choon Phong and Tata SIA Airlines Chairman Prasad Menon.

While Tata declined to comment, sources in the ministry said the meeting was a courtesy call. Yesterday, Tata along with Phong had also met Finance Minister P Chidambaram after the FIPB cleared the venture.

The market is directionless once again with the Nifty hovering around 6150. The Nifty is down 4.15 points or at 6160.20. The Sensex is up 15.96 points at 20741.39. About 972 shares have advanced, 1351 shares declined, and 150 shares are unchanged. Technology stocks are holding firm while other stocks are sliding.

The IT pack is led by TCS (up 3 percent), followed by Wipro (up 2 percent. Other gainers in the Sensex are Sesa Sterlite, NTPC and Bajaj Auto . Among the laggards are Hindalco , Tata Steel , M&M, HUL and BHEL . Capital Goods, Metals, Autos and Realty indices are under heavy selling pressure.

02:15pm: TVS Q2 beats street TVS Motor Company impressed the street with the second quarter net profit rising 97 percent higher-than-expected on yearly basis to Rs 89 crore on exceptional gain and strong sales.

The company earned an exceptional gain of Rs 30.3 crore during second quarter on divestment of its stake in TVS Energy. After the divestment, TVS Energy and its two subsidiaries ceased to be subsidiaries of the company with effect from August 16, the company said.

Total income rose year-on-year to Rs 1,988 crore in three months period ended September 2013, beating analysts' expectations. According to a CNBC-TV18 poll, analysts on an average had expected the two-wheeler maker to report net profit of Rs 62 crore on revenues of Rs 1,712.4 crore for the quarter.

1:55 pm Analyst view: Vaibhav Agrawal of Angel Broking says,"The net profit is in-line but higher than the market estimates. Again, we have to see how much that was due to volatility, forex and treasury in this quarter.

On the asset quality (side), it is better than estimates. Looking at the numbers, they would have benefited from the volatility on assets and treasury during the quarter."

1:45 pm Credit policy poll: The market is unanimous in its expectations from RBI's credit policy meet on October 29. A CNBC-TV18 poll reveals that Governor Raghuram Rajan will walk his talk and hike repo rate by 25 basis points (bps) and leave CRR unchanged.

Around 90 percent of economists polled also believe that Rajan will roll back the Marginal Standing Facility to its earlier rate of 8.5 percent. Only 10 percent feel that the central bank will wait before cutting the MSF.

1:35 pm Baordroom: NMDC is confident of achieving the sales target of 28 million tonnes (MT) set for FY14 even without the benefit of evacuation by slurry pipeline, which supplies iron ore from Kirandul to Kottavalsa in Visakhapatnam, says CS Verma, Chairman, NMDC. The company is also confident of achieving the export target of 2.5-3 milion tonne. Since the iron prices have now started to firm up, he does not expect pressure on margins going ahead.

1:20 pm Alert: The end game in the National Spot Exchange (NSEL) fraud appears to have begun. Government sources told CNBC-TV18 that the board of directors of NSEL as well as the management is set to face criminal prosecution on dozens of charges. Police investigators are relying on the Arvind Mayaram-led government panel report, which has specified the list of charges that NSEL was liable for.

The market is volatile on the back of profit booking and weak cues from Asia. Metals, capital goods and infra are among the major laggards but technology stocks are holding firm today.

The Sensex is down 34.11 points at 20691.32, and the Nifty is down 19.30 points at 6145.05. About 867 shares have advanced, 1358 shares declined, and 152 shares are unchanged. The ICICI has reported a blockbuster September quarter results. Net interest income rose by almost 20 percent year-on-year while net interest margins (NIMs) rose to 3.31 percent versus 3.27 percent sequentially.

Asset quality also improved with gross non-performing assets down to 3.08 percent. In global markets, Asian markets are take a beating led by Nikkei and Shanghai as the yen strengthened against the dollar.

The market remained weak amid choppy trade with the Nifty trading below 6150 level, weighed down by healthcare, metals, capital goods and auto stocks. The Sensex is down 40.27 points at 20685.16, and the Nifty is down 20.70 points at 6143.65. Declining shares outnumbered advancing ones by 1147 to 845 on the BSE. The market is heading towards weak closing for the current week as it saw a bit of profit booking after rising for more than 5 percent in previous three weeks.

The laggards are L&T, Sun Pharma , M&M, Tata Steel , Hindalco Industries and BHEL , which lost 2-4 percent. Hindustan Unilever continues to decline ahead of second quarter numbers on Saturday, falling more than 1 percent. However, ITC and ICICI Bank remained in bull grip with small gains ahead of September quarter earnings today. Technology stocks bounced back after falling for previous two sessions on profit booking. TCS rose 1.7 percent followed by Wipro and Infosys with marginal gains.

11:50 am Boardroom: Biocon's capex plans for the current financial year are on track and the outlook remains positive, Kiran Mazumdar Shaw, chairman and managing director, told CNBC-TV18 in an interview.

The biotech major Wednesday reported a better-than-expected 17 percent year-on-year increase in sales for the September quarter, helped by a 46 percent surge in revenues from its clinical research business.

The margins for the clinical research division, which accounts for one-fourth of total revenues, was maintained at 25 percent. She said the business would be listed only after it stabilised.

11:40 am Update: Identifying India as one of the five fragile economies of the world, a senior US official has predicted an uncertain outlook for its future in view of the next year's general elections, reports PTI. "The big question about India now is what happens in the election next year and who will be the new government. That's a very complicated question," assistant treasury secretary for international finance Charles Collyns, said.   "India's the world's largest democracy. It has a multiple of political parties. There's one party on the right, the BJP, which would certainly try to push forward pretty aggressive reforms.

11:30 am Buzzers: Deepak Fertilisers is up 3 percent after it reported a massive 40 percent growth in revenues and a 10 percent growth in bottomline in September quarter. Rolta India jumps 2 percent as it saw a marginal increase in revenues.

11:20 am Opinion: The central bank will hike repo rate, or the rate at which banks borrow from the central bank (Reserve Bank of India ), by a total of 50 basis points (bps) till FY14-end, believes Tirthankar Patnaik, executive vice president- institutional sales, Religare Capital Markets. Speaking to CNBC-TV18 , Patnaik says the RBI is unlikely to throw a wet blanket on Diwali sentiment by hiking repo rate in its October 29 monetary policy but endorses the possibility of a hike in December.

Additionally, Patnaik says the Nifty is likely to trade in its current 6000 levels. ''The rupee looks fairly stable and with the trade deficit coming in lower than expected for the last couple of months, people are taking some sort of faith in the markets right now,'' he adds.

The market is extremely flat with the Sensex down 9.21 points at 20716.22. The Nifty is down 10.95 points at 6153.40. About 804 shares have advanced, 921 shares declined, and 117 shares are unchanged. Hindalco , M&M, BHEL , L&T, Sun Pharma were top losers in the Sensex while Wipro , TCS , ICICI Bank , Sesa Sterlite and Infosys gain.

Asian markets trade lower with Japan and China slipping on a stronger yen and concerns of liquidity tightening in China. The dollar still struggles at 2-week lows against the euro which is trading at 1.38. Commodities saw Brent gain but is set for its steepest fall in a month with over a 2.5 percent loss. Gold is set for a second weekly gain.

Back home, the rupee is weak today on the back of importers month end demand and foreign banks buying dollars. Government bond prices were trading in a thin band ahead of the Reserve Bank of India's second quarter review of monetary policy next week.

10:55am Market Expert Even though the Sensex shied away from touching all-time high levels, there is a good chance of an overshoot on the upside in the next few days, believes Sandeep Shenoy, Anand Rathi Financial Services.

However, if all-time high levels are not taken out before the end of the earnings season then the peak will not be attained, warned Shenoy. He advises long-term investors to sell into the rally whenever it happens as they can reenter the market 3-5 percent lower. Post earnigns, he does not see any other trigger for the market.

10:46am Movers & Shakers
TCS and Wipro are the major gainers with around 2 percent gains followed by Infosys , ICICI Bank and Sesa Sterlite with 0.7-1 percent gains. However, L&T, Sun Pharma , BHEL , M&M and Hindalco Industries topped the selling list, falling between 2-3 percent.

Hindustan Unilever fell further, losing 1.4 percent on top of a 1 percent fall in previous session after its parent company Unilever reported slower sales growth for the third quarter. Unilever reported a 3.2 percent rise in third quarter sales, which compared with a 5 percent increase for the second quarter. HUL will declare its second quarter numbers on Saturday.

10:23am The market is directionless in morning trade on last trading session of the week as it is waiting for second quarter earnings from ICICI Bank and ITC , heavyweights among frontliners. The Sensex is down 40.79 points at 20684.64, and the Nifty is down 19.10 points at 6145.25. Meanwhile, Abhay Laijawala of Deutsche Equities raised December Sensex target to 22,000 from 21,000.

He believes expectations of a troughing macro economy, likely withdrawal of liquidity tightening measures by RBI, synchronised global growth recovery and a Fed that is expected to stay 'looser for longer' should offset near-term concerns. FMCG major ITC and top private sector lender ICICI Bank will announce September quarter earnings today. Both stocks are marginally in the green.

\Analysts on an average expect another steady quarter from ITC with the profit after tax rising 15.2 percent year-on-year to Rs 2,115 crore, according to a CNBC-TV18 poll. In case of ICICI Bank, asset quality will be the key focus this time because the management had earlier cautioned that its asset quality could be under pressure.

10:00 am Results poll: Private sector lender ICICI Bank will announce its second quarter earnings today. According to a CNBC-TV18 poll, its asset quality will be the key focus this time because the management had earlier cautioned that its asset quality could be under pressure. In the June quarter, the bank managed to maintained its asset quality.

Its gross non-performing advances (NPAs) rose 4 percent sequentially and net NPAs climbed 10 percent Q-o-Q, but slippages came in higher Q-o-Q to Rs 1,116 crore from Rs 780 crore. Fresh addition to restructuring was Rs 800 crore as against Rs 753 crore Q-o-Q.

9:50 am Buzzer: Idea Cellular is down over 1 percent on the BSE. The telecom operator's second quarter (July-September) consolidated net profit fell 3.3 percent lower-than-expected sequentially (up 86.5 percent year-on-year) to Rs 447.6 crore, dented by fall in revenues.

"With increasing proportion of rural subscribers, the seasonal slowdown in the second quarter has become more pronounced resulting in sharp contraction in the voice of minutes of use by 5.8 percent," the company said in its filing.

Total voice minutes of use dropped 5.8 percent Q-o-Q to 138.8 billion minutes from 147.3 billion minutes, far lower than analysts' expectations of 141.5 billion minutes.

9:40 am Budget: Finance Minister P Chidambaram is finding it harder and harder to meet the government's budget promises and may sweep as much as USD 15 billion in subsidy costs into next year's accounts to ensure he hits fiscal targets ahead of national elections, ministry officials say.

Chidambaram insists that the fiscal deficit target of 4.8 percent of GDP for the year to March 31, 2014, is a red line that will not be breached. The worst economic downturn since 1991 and a fall in the rupee to a record low have undermined budget assumptions for some months.

9:30 am FII View: Abhay Laijawala of Deutsche Equities has raised Sensex target to 22,000 from 21,000 in December. "We believe expectations of a troughing macro economy, likely withdrawal of liquidity tightening measures by RBI, synchronized global growth recovery and a Fed that is expected to stay 'looser for longer' should offset near-term concerns," he says. Hi top picks include Axis Bank , Bharti, Bharat Forge , Coal India , Godrej Consumer , ITC & IndusInd Bank .

After a spectacular rally which cooled off a bit towards the end on Thursday, the market opened on a soft note today. The Sensex is down 31.26 points at 20694.17, and the Nifty down 17.55 points at 6146.80.

About 129 shares have advanced, 173 shares declined, and 15 shares are unchanged. Sesa Sterlite, Wipro , TCS , ICICI Bank and Dr Reddy's Lab are top gainers in the Sensex. GAIL , M&M, Bajaj Auto , Jindal Steel and BHEL are amogn the losers in the Sensex. The Indian rupee flat in early trade against the dollar.

It opened at 61.50 per dollar against 61.47 Thursday. The euro is steady against the dollar this morning after disappointing euro zone data pulled it away from a two-year high struck earlier in the session. The dollar is a little weak near nine-month lows on rising expectations the Federal Reserve will delay reducing its bond-buying program until into next year.

Asia is lower on the back of a stronger currency and tepid economic data, core consumer price index (CPI) climbed 0.7 percent in September (Y-o-Y); in line with expectations. China's short-term money market rates continued to spook investors after spiking to their highest level since June.

The US markets recovered the previous day's losses to close higher with the Dow closing above 15,500 and the S&P 500 regaining its footing above 1,750 aiding sentiment was a handful of upbeat earnings and encouraging economic data from china. Both are on track for their third-straight winning week. European markets closed higher thanks to strong corporate results and encouraging data from China, and despite fresh data showing that euro zone business growth had been hit by falling demand.

In commodities, Nymex futures recoup losses in choppy trade this morning while Brent prices slip as traders bet that an abrupt slump earlier this week in the hotly traded Brent-WTI spread had gone too far. From precious metals space, gold prices  hover near a one-month peak and look set to end higher for a second straight week on hopes that weak US. Data would deter the federal reserve from scaling back its stimulus measures this year.