Sensex, Nifty end flat; small & midcaps rally, autos drag

03:30 pm Market closing
The market closed flat dragged by some bit of profit booking. The Nifty consolidated at around 8300. The 50-share index ended at 8324, up 1.95 points while Sensex was down 5.45 points  at 27860.38. However, small & midcaps rallied with some smart gains. Realty index was up 3 percent.

Sesa Sterlite, Axis Bank, HDFC, SBI and ICICI Bank were top gainers while Gail, M&M, Coal India, Maruti and Bajaj Auto were among the laggards.

3:00 pm China economy
China's economy lost further momentum heading into the fourth quarter as a cooling property market weighed on activity and export demand softened, surveys showed, putting Beijing's official target for the year at even greater risk.

Analysts had already expected full-year growth to miss the goal of around 7.5 percent, but many thought there may be some signs of stabilisation in the world's second-largest economy late in the year after a flurry of stimulus measures.

Instead, the surveys showed demand at home and abroad continued to cool and the labour market remained under stress, while adding to fears that many companies are being starved of credit as banks grow more reluctant to lend.

02:30pm Dabur India up over 1%
FMCG major Dabur India has reported a 15.1 percent growth in net profit at Rs 287.5 crore in September quarter compared to Rs 249.74 crore in same quarter last year.

Total income from operations grew by 10.3 percent to Rs 1,929.6 crore in the second quarter of current financial year 2014-15 from Rs 1,748.90 crore in the year-ago period driven by consumer care as well as foods businesses.

The company maintained its volume growth within the guidance of 8-10 percent. Volume growth for September quarter was 8.7 percent compared to 8.3 percent in previous quarter.

Bottomline was in-line while topline was slightly lower than analysts' expectations. Profit was expected at Rs 286 crore on revenue of Rs 1,991 crore for the quarter, according to the average of estimates of analysts polled by CNBC-TV18.

02:00pm Market Check
The market remained flat with a negative bias as the Sensex and Nifty consolidated their gains after hitting record highs last week. The BSE Midcap and Smallcap indices continued to outperform benchmarks, up 1 percent each.

The 30-share BSE Sensex fell 47.59 points to 27818.24 and the 50-share NSE Nifty declined 13.25 points to 8308.95. About 1679 shares have advanced, 1145 shares declined, and 117 shares are unchanged.
 
Andrew Holland of Ambit Capital said he expects the Nifty to hit 9000 before the Budget and will not be surprised to see a 50 basis points rate cut in the first quarter of calendar year 2015.

Sesa Sterlite topped the buying list in the Sensex, up 2 percent followed by Axis Bank, ICICI Bank, SBI and Reliance Industries with 0.6-1.5 percent while Gail India tanked 5.58 percent as CLSA downgraded the stock to sell from outperform. Mahindra and Mahindra, Coal India, Maruti Suzuki and NTPC lost 1.5-3 percent.

In macro data, the auto industry is in reverse gear as sales for the month of October missed expectations. The festive season failed to cheer, most auto makers like Mahindra & Mahindra, Maruti Suzuki, Tata Motors and Hero Motocorp reported a drop in sales.

Ashok Leyland surged 2.5 percent to touch a record high of Rs 47.50 after reporting a 23 percent rise in total sales at 8,375 units in October year-on-year.

The currency was trading weak at 61.41 to the dollar on account of dollar buying from importers and gains in the dollar overnight. Gold, in the meantime, struggled near a four-year low, trading at sub USD 1170 an ounce.

Globally, equity markets were a mixed bag. Asian markets like Korea and Hong Kong were lower by 0.5 percent while China was higher after Chinese PMI data rose to 3-month high of 50.4. European markets, in the meanwhile, were trading flat today ahead of euro zone PMI data later today.

1:50 pm Results: Public sector lender Bank of India met street expectations with the profit rising 26.4 percent year-on-year to Rs 786 crore in September quarter led by fall in provisions and higher net interest income. Profit in the year-ago period was Rs 621.77 crore. Net interest income, the difference between interest earned and interest expended, shot up 20 percent (better than expectations) to Rs 3,031 crore in the second quarter of current financial year 2014 compared to Rs 2,527 crore in same quarter last year but other income (non-interest income) declined by 8.5 percent to Rs 1,006.4 crore during the same period.

Net profit was expected at Rs 786 crore and net interest income at Rs 2,745 crore for the quarter, according to the average of estimates of analysts polled by CNBC-TV18.

1:30 pm Brokerages downgrade: Shares of Gail fell 6 percent intraday on Monday after a slew of downgrades by brokerage. This is despite September quarter net profit more than doubled (Q-o-Q) to Rs 1,303 crore led by other income and strong operational performance.

CLSA has its rating to sell from outperform with a target of Rs 475 per share as it feels that the state-run natural gas transmission company is trading at 40 percent premium to its 10 year average price to equity. Hence CLSA finds these valuations unsustainable since turnaround in core business is unlikely in next two years and return-on-equities (ROEs) will remain under pressure.

"Gail did not build any subsidy burden pending quarterly demand from oil ministry and this boosted its Q2 FY15 net profit The recent stock price rally completely ignores earnings risk from falling crude given its big sensitivity,'' CLSA said in a note.

After a firm start, the market has gone flat. Weakness in auto stocks hits sentiment whereas realty and banking stocks support. The Sensex is down 15.43 points at 27850.40, and the Nifty is down 6.20 points at 8316.00. About 1628 shares have advanced, 1099 shares declined, and 113 shares are unchanged.

Sesa Sterlite, Axis Bank, SBI, ICICI Bank and Reliance are top gainers in the Sensex. Among the losers are Gail, M&M, Bajaj Auto, Hero MotoCorp and Coal India.

The rupee trimmed its initial losses against the American currency but was still quoted down by 10 paise to 61.46 per dollar on some demand from banks and importers in view of firm dollar in the overseas market. However, it trimmed its initial losses and was quoted at 61.46 per dollar in view of good foreign capital inflows into equity market.

12:55pm NMDC post earnings
NMDC shares declined nearly 2 percent after reporting earnings for the second quarter.

Narendra Kothari, CMD, NMDC is confident of FY15 being far better than FY14 on back of strong volumes.

The company has cut its iron ore lump prices by Rs 200 per tonne for November but will maintain iron ore fine prices at the current level because of good local demand, he added. The company also expects to maintain employee costs at Rs 200 crore per quarter, he added.

The mineral producer has reported a 18.4 percent (year-on-year) growth in second quarter net profit at Rs 1,566.8 crore led by strong operational performance and revenue but was impacted by exceptional loss of Rs 112.2 crore. Profit in the year-ago period was Rs 1,318.4 crore.

On the royalty front, he said higher royalties will be passed through to the consumers
The company targets to spend Rs 250 crore towards corporate social responsibility (CSR) in FY15.

12:30pm Dabur India gains ahead of earnings
FMCG major Dabur India is expected to report a 14.5 percent growth in its second quarter profit after tax at Rs 286 crore compared to Rs 250 crore in the year-ago period, according to the average of estimates of analysts polled by CNBC-TV18. The stock gained 1.5 percent ahead of earnings announcement.

Total income from operations may grow 13.5 percent to Rs 1,991 crore in the quarter ended September 2014 compared to Rs 1,754 crore in same quarter last year.

Operating profit (earnings before interest, tax, depreciation and amortisation) is seen rising 11.8 percent on yearly basis to Rs 368 crore but margin may decline 30 basis points to 18.5 percent in the quarter gone by.

Margin for April-September FY15 is likely to remain flattish as price increases in H1FY15 are only sufficient to counter raw material inflation.

12:00pm Market Check
The market continued to consolidate with a negative bias in noon trade but the 50-share NSE Nifty held the 8300-mark supported by banks and metals stocks. Reliance Industries and L&T too supported the market. However, weakness in auto stocks hit sentiment.

The Sensex fell 49.26 points to 27816.57 and the Nifty declined 16.35 points to 8305.85 while the BSE Midcap and Smallcap indices gained 1 percent each. Advancing shares outnumbered declining ones by a ratio of 1587 to 1081 on the BSE.

Gail India topped the selling list, falling over 4 percent after reacting positively to its numbers on Friday. Credit Suisse has downgraded the stock to neutral, saying gas trading EBITDA remained below historical trends.

Auto companies lost ground. Mahindra and Mahindra slipped 3 percent reacting to a 15.4 percent Y-o-Y drop in October sales. Hero Motocorp declined over a percent on a 8.5 percent fall in October sales to 5.75 lakh units. Bajaj Auto plunged 1.5 percent as its October sales remained lower than management guidance of 4 lakh units. Maruti too sulked in trade, down over a percent as total sales fell 1.1 percent Y-o-Y to 1.03 lakh units.

Aviation stocks gained today reacting to aviation turbine fuel prices being cut by 7.3 percent. This was the fourth straight reduction in prices since August.

11: 50 am FII view: Andrew Holland CEO, Ambit Investment Advisors is bullish on Indian equity market and foresees the Nifty touching 9,000 mark by Budget next year. In an interview to CNBC-TV18, he says, "Over the past few months, I have been travelling around meeting a lot of high networth individuals (HNIs). What they say is that I am proud to be Indian again. It is a very powerful statement. I think that will hold us in good state even through turbulent times in global markets."

He feels that pro-reform Narendra Modi could be able to push tough reforms going ahead. On macros, he expects the Reserve Bank of India (RBI) to cut rates by 50 bps in Q1CY15. Sectorally,Holland is playing the theme of buy supplies. He is also monitoring the performance of banks more closely.

11:30 am Autos fall: Auto stocks are succumbing to selling pressure on tepid October sales as investors were hoping to rake in strong growth during the festive season. Shares of Maruti, M&M, Bajaj Auto, Hero MotoCorp and Tata Motors are down 1-3 percent.

Despite the overall weak auto sales data, Rajiv Bajaj, managing director of Bajaj Auto is pleased that his company's motorcycle market share in the country rose to 20 percent. He expects the market share to rise to 23 percent by April.

He says festive season sales have been good, but not extraordinary. Total sales for October stood at 3.86 lakh units versus 3.99 lakh units month-on-month (m-o-m), with Discover 150cc sales at around 28,000 for the month.

The country's largest car-maker Maruti Suzuki India reported a 1.1 percent decline in total sales in October at 1,03,973 units as against 1,05,087 units in the same month last year. The company said its domestic sales rose by 1 percent during the month to 97,069 units as against 96,062 units in October, 2013.

Meanwhile, even after a bumper festive sale, Hero MotoCorp did not see much growth in October trade. It had said it clocked sales of over 10 lakh two-wheelers during the 37-day festive period, which started on September 25 (first day of Navratras) and lasted until October 31 2014. The country's largest two-wheeler maker Hero MotoCorp  reported 8.05 percent fall in its sales in October to 5,75,056 units. The company had sold 6,25,420 units of two-wheelers in October 2013.

The market is off the days high but still steady. Nifty trades comfortably above 8300 consolidating last week's gains. The Nifty is down 19.65 points at 8302.55 and the Sensex is down 56.58 points at 27809.25. About 1419 shares have advanced, 929 shares declined, and 95 shares are unchanged.

Gail, M&M, Hero MotoCorp, Maruti Suzuki and BHEL are among laggards in the Sensex. Among the gainers are Sesa Sterlite, Dr Reddy's Labs, SBI, Axis Bank and L&T.

Indian factory activity expanded at a modest pace in October, as stronger demand led manufacturers to add jobs for the first time in four months and allowed them to raise prices, a business survey.

The HSBC Manufacturing Purchasing Managers' Index (PMI), compiled by Markit, rose to 51.6 in October from 51.0 in September. The index has now been above the 50 level that indicates an expansion in activity for a year.

"Manufacturing activity picked up modestly amid stronger output and new order flows, particularly from overseas clients," said Frederic Neumann, co-head of Asian economic research at HSBC.

Globally Asian markets trade mixed in quiet trade as the Nikkei is shut today. Chinese HSBC final PMI rose to a three month high of 50.4. Currencies continue to demand attention with the euro at the lowest in over two years. Rupee declines against the dollar today.

10:55am Karnataka Bank on buyers' radar
Investors lapped up more shares of Karnataka Bank today after the private sector lender reported a 3-fold jump (year-on-year) in its second quarter net profit at Rs 88.5 crore. The stock gained as much as 7.5 percent intraday, in addition to 3.4 percent in previous session.

The sharp growth in bottomline was led by lower provisions and higher other income. The jump in profit also attributed to low base in the same quarter last year. In Q2FY14, profit fell 75 percent Y-o-Y to Rs 29 crore due to a 457 percent year-on-year jump in provisions at Rs 127 crore.

Net interest income of the bank rose by 4.5 percent to Rs 297.3 crore in the quarter ended September 2014 compared to Rs 284.5 crore in same quarter last year while other income (non-interest income) jumped 17 percent to Rs 102.8 crore from Rs 87.80 crore during the same period.

10:30am Interview
Sanjiv Kapoor, COO, SpiceJet is hopeful of further price cuts in the aviation turbine fuel (ATF) being passed through going forward. However, he says any price cut has been a welcome one and eases the costs pressures. The company sees an impact of Rs 320 crore from this cut.

According to him the ATF prices in India are still significantly high, 40-60 percent higher than rest of the world. Globally the prices have dropped 17 percent from June, whereas in India only 10 percent has been passed through so far.

The price of aviation turbine fuel (ATF), or jet fuel, at Delhi was cut by Rs 4,987.7 per kilolitre, or 7.3 percent, to Rs 62,537.93 per kl, oil companies announced today.

The slew of festive season discounts offered by the airlines has led to improved revenues, and the load factor too improved to 86% in September, said Kapoor.

10:00am Market Check
Equity benchmarks continued to see consolidation after more than 500 points rally (on the Sensex) in previous session. The Sensex rose 20.02 points to 27885.85 and the Nifty gained 2.85 points at 8325.05.

The broarder markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising 0.7 percent each. About 1283 shares have advanced, 742 shares declined, and 69 shares are unchanged on the Bombay Stock Exchange.

Technology stocks like Infosys, TCS and Wipro climbed 0.4-1.2 percent while metals stocks namely Sesa Sterlite, Hindalco Industries and Tata Steel jumped 1-2 percent. Drug maker Dr Reddy's Labs topped the buying list, up more than 2 percent.
 
However, auto stocks remained under pressure post weak sales numbers in October. Mahindra and Mahindra, Bajaj Auto, Maruti Suzuki and Hero Motocorp declined 1-2.7 percent but TVS Motor climbed 2 percent (also hit a record high of Rs 266.55) after reporting a 22 percent rise in October sales Y-o-Y.

Gail topped the selling list, falling 3 percent on profit booking. HDFC, Reliance Industries, HUL, HDFC Bank, ICICI Bank, BHEL and NTPC declined 0.2-1 percent.

9:50 am FII view: The current rally in the Indian market is more of a hope and expectation rally, says Arvind Sanger of Geosphere Capital. Despite the poor core sector data that came out on Friday and poor auto sales data, he believes these numbers to be abberational. He is surprised that consumer sales numbers did not pick up in the festive season.

However, he adds that after a while, the hope rally will fade and the effects of growth will need to be seen in terms of the economic data coming out - whether in terms of rise in consumer spending or on the industrial side, capex side. Sanger says it will take a little longer to see growth in terms of capex, but he expects quicker turnaround on the consumer spending front. Due to the base effect, benign numbers are expected on the inflation side, he adds.

9:30 am Buzzing: Shares of aviation stocks are flying as aviation turbine fuel (ATF) rates are cut by a steep 7.3 percent, the fourth straight reduction in prices since August on back of falling international oil rates. SpiceJet was up 7 percent while Jet Airways soared 6 percent intraday on Monday.

Hailing it as good news, Sanjiv Kapoor,COO, SpiceJet said that  ATF prices in India is 40-60 percent higher than rest of the world. In an interview to CNBC-TV18 he added revenues have improved significantly due to festive season discounts and load factor has improved to 86 percent in September.

The price of aviation turbine fuel (ATF), or jet fuel, at Delhi was cut by Rs 4,987.7 per kilolitre, or 7.3 percent, to Rs 62,537.93 per kl, oil companies announced today.This is the fourth reduction in jet fuel rates since August. Rates were cut by almost 3 per cent or Rs 2,077.62 per kl on October 1.

The market continues its uptrend on Monday as the benchmark indices have opened at record high again. The Sensex is up 85.20 points at 27951.03 and the Nifty is up 26.10 points at 8348.30. About 533 shares have advanced, 155 shares declined, and 36 shares are unchanged.

TCS, Bharti Airtel, GAIL, Wipro and BHEL are top gainers while Tata Motors, Hero, Bajaj Auto, and M&M are major laggards in the Sensex.

The Indian rupee opened lower by 14 paise at 61.50 per dollar versus 61.36 Friday.The yen fell to a fresh seven-year low against the dollar, extending a massive selloff sparked by the Bank Of Japan's surprise decision to boost its already huge bond-buying stimulus.

Agam Gupta of Standard Chartered said, "Nationalised bank demand will kick in at Rs 61.35/dollar and expect exporters to sell on spikes to Rs 61.60/dollar. US dollar supply will also continue from capital inflows as overseas investors remain bullish on India."

In the US, stocks surged on Friday, lifting the Dow industrials and S&P 500 to record closes, after the Bank of Japan unexpectedly expanded stimulus, increasing hopes for the global economy.

Meanwhile in Asia, mood is relatively quiet with Japan closed for a holiday. Kospi is lower after a private gauge of manufacturing activity fell to a four-month low in October. China's official PMI fell to a five-month low for October as it came in at 50.8 from September's 51.1.

Oil prices are soft in trade as another round of monetary stimulus from Japan pumped up the US dollar and pounded a crude market already suffering from robust supply. From the precious metals space, gold and silver sank to their lowest since 2010 as the USD surged against the yen and other major currencies.