Nifty ends below 6000; two-wheeler makers fall

09 Jan 2013

Key equity benchmarks fell on Wednesday as two-wheeler makers such as Bajaj Auto retreated after an industry body cut its estimates for motorcycle sales, while software services exporters such as Tata Consultancy Services fell ahead of upcoming earnings results.

The Sensex ended the day down 87.12 points at 19655.40, while the Nifty closed down 30.80 points at 5970.90.

Railway stocks rallied after the Railways Minister announced hike in fares from January 21. However, he added, there will be no increase in fares in February rail budget. The fare hike will yield Rs 66 billion in revenues.

Indian Indices continued trading in a range in the absence of a trigger.  The consolidation seen in the last few sessions was expected after Nifty touched the 6000 mark a few days back. Even Europe, which has opened with slight gains, have not moved Indian markets. At 2 PM, the wide-based National Stock Exchange index Nifty was up 1.65 points or 0.03% at 6003.35. The 30-share BSE benchmark Sensex was trading up 30.81 points or 0.16% at 19773.33.

Tata Motors continued to be the top gainer on the Sensex with over 4.50 percent gains. GAIL, Bharti, Coal India and SBI were the other Sensex gainers, rising between 1.6 percent and 2 percent. Midcaps to have been muted for most part of the day. However midcap realty stocks like Sunteck Realty, Purvankara, and smallcap realty play Kolte Patil sparkled with 6.87 percent, 4.91 percent and 9 percent gains, respectively.

Meanwhile, results season kicked in with IndusInd Bank reporting its third quarter numbers . The bank's net profit grew by 29.76 percent year-on-year to Rs 267.3 crore in the quarter ended December 2012. The bank said it will lower interest rates if RBI cuts repo rate in its January 29 olicy meet.

IT Bellwether Infosys, which will announce its numbers on Friday, was trading with a marginal loss of 0.14 percent. TCS, after a spectaular numbers in the second quarter, was trading with a cut of over 1.6 percent.

The stock markets have remained rangebound after a gap-up opening even as the NSE benchmark Nifty struggles to break the 6000 mark decisively. Midcaps are doing marginally better with pockets of gains in individual counters.

At 12.33 PM, the Sensex was up 13.39 points or 0.07% at 19755.91, and the Nifty down 2.45 points or 0.04% at 5999.25.

Tata Motors is the biggest gainer of the Nifty, rising 4.9 percent after CLSA upgraded the stock saying fears of a sharp drop in China demand and margins have receded. ''Chinese luxury outlook has started improving again," CLSA reasoned in its report.

Other Nifty gainers were Coal India (2.08 percent), Mahindra and Mahindra (1.41 percent), GAIL (1.22 percent) and Bharti Airtel (1.12 percent). Index heavyweight  ITC , TCS , NTPC, BHEL and HDFC were trading with a cut of 1 percent to 2 percent.

Meanwhile, a Crisil report has suggested that India will see a consumption-led revival in 2013-14. Improved agriculture, lower interest rates, and higher government expenditures are going to aid growth this year, the report noted.

Equity benchmarks continued to trade higher since early trade today following positive Asian cues, helped by banks and auto (four wheeler) stocks.

The 50-share NSE Nifty remained above the important psychological 6000 level, rising 15 points to 6,016.65. Meanwhile, the 30-share BSE Sensex gained 75.29 points to 19,817.81.

Commercial vehicle major Tata Motors shot up 5 percent on upgrade reports by various brokerage firms. CLSA upgraded the stock to "buy" from "outperform" and Credit Suisse upped its rating to "outperform," citing strong growth prospects for Jaguar Land Rover, driven by the new Range Rover and Chinese demand.

Utility vehicle maker Mahindra & Mahindra and top car producer Maruti Suzuki gained 1 percent each whereas two-wheeler majors Hero Motocorp and Bajaj Auto were marginally down.

Country's largest lenders State Bank of India and ICICI Bank were up 0.9 percent and 0.6 percent, respectively.

Index heavyweight Reliance Industries rose 0.7 percent while engineering conglomerate Larsen & Toubro and software services exporter Infosys were up 0.5 percent each.

Healthcare stocks gained for the second consecutive session. Sun Pharma and Cipla went up over 1 percent while Dr Reddy's Labs was up 0.3 percent.

However, shares of HDFC, ITC, Tata Steel, TCS, BHEL, Wipro and NTPC were down 0.3-0.9 percent.

On the global front, Shanghai and Hang Seng rose 0.2-0.4 percent while Nikkei advanced one percent.

Key equity indices were up in early trade, but on low volumes as traders nervously watch macro-economic events and corporate earnings trend.

On Tuesday, global rating agency Fitch retained its negative outlook on India and said the government's recent measures were not adequate to address the fiscal mess.

The Sensex was up 48 points at 19790, and the Nifty was up 8 points at 6010.

The next key short term triggers for the market are the industrial output data for November and Infosys third quarter earnings, both due Friday.

The widely-held view is that the stock valuations broadly are beginning to look expensive after the run-up since November. And while the sentiment is positive, investors are likely to focus on selective stocks, limiting the chances of a broad-based upmove as was seen recently.

Jet Airways, Tata Motors, HDIL, and Indiabulls Finance led early gainers, up 2-3 percent.

Jet Airways shares, trading at Rs 606, have been steadily climbing in anticipation that Gulf-based Etihad will shortly buy a strategic stake in the Indian carrier at a significant premium.

In sectorwise trends, shares from auto and realty sectors are doing well at this hour, as these are sensitive to interest rates and could gain if the RBI cuts rates at its January 29 meeting as widely expected.

Banking and FMCG shares were flat.