Sensex closes flat; midcap & smallcap outperform, up 1.2%

After Friday's 371-point rally on the Sensex, equity benchmarks saw consolidation on Monday as there is no trigger in near term. However, broader markets rallied smartly.

It was a flat closing for the market amid thin volumes as investors are eyeing a Christmas holiday. The volatility was also on account of December series expiry that will be on Thursday.

The Sensex rose 21.31 points to close at 21,101.03, and the Nifty advanced 10.25 points to 6,284.50 while the BSE Midcap and Smallcap indices jumped 1.2 percent each. Advancing shares outnumbered declining ones by a ratio of 1581 to 911 on the BSE.

The market will remain choppy going ahead due to lack of trigger, feel experts. According to them, the next trigger will be third quarter earnings, which will kick-off in second week of January.

''It is a choppy market. So the suggestion is that even for tomorrow we should leave the Nifty be. Let it decide the next course of action and focus only on individual stock plans,'' Sudarshan Sukhani of s2analytics.com said.

3:55 pm Interview: The coal ministry recently cancelled allotment of a coal block in Madhya Pradesh to Jindal Steel & Power Ltd and Monnet Ispat & Energy Ltd as they failed to develop it. Speaking to CNBC-TV18 on the issue, Ravi Uppal, JSPL said the company is disappointed with coal ministry's show cause notice for delay in development of coal mines adding that the timeline given to them was not reasonable.

"The de-allocation by the government was a sad development given that the company had been working really hard on the development of those blocks," he said. According to Uppal, the financial loss incurred by the company due to the de-allocation of coal blocks is severe and cannot be quantified.

''JSPL in the whole industry is known do projects in shortest possible time. We are considered to be an icon and if we cannot do that you can be assured nobody else can do better than us,'' he added.

3:46 pm Market closing: The Sensex ends up 21.31 points at 21101.03, and the Nifty closes below at  6284.50, up is 10.25 points. About 1579 shares have advanced, 915 shares declined, and 166 shares are unchanged.

Benchmark indices trim intraday gains to end the day flat. Both the Sensex and Nifty add around one-tenth of a percent each. But broader markets rally - midcaps and high beta lead the way

RBI Governor Raghuram Rajan reiterates that the central bank is not on hold and is only waiting for more inflation data. He tells CNBC Awaaz that he expects good harvest and stronger rupee to lower inflation.

The market is holding up gains in the last trading week of the year. The Sensex is up 13.78 points at 21093.50, and the Nifty is up 11.95 points at 6286.20. About 1521 shares have advanced, 881 shares declined, and 160 shares are unchanged.

Bank Nifty outperforms with a 1 percent  gain while rate sensitives and metals are also faring well today.

Rupee is going stronger on dollar sales. Bonds higher tracking the fall in US yields and a stronger rupee.

Financial Tech is under pressure as sources indicate that Sebi has issued a show cause notice to the company post FMC order on being fit and proper. Sebi has asked Financial Tech to reply by December 26.

Market in 2014 will depend on the general elections scheduled in May and global cues, Ridham Desai, MD, Morgan Stanley said. In a bull case scenario, one could brace for a 25 percent growth and a bear case could pull it down by the same amount, he told CNBC-TV18 in an interview.

The election verdict is a crucial a market determinant and it is pricing-in a positive election verdict. However, only a strong election mandate may not trigger a bull market in 2014 because policy reforms that would lift India's growth may not be in place yet, he added. Meanwhile, there could be a positive surprise in the US market in 2014 since the US Federal Reserve is exuding more confidence about the country's growth and US growth could be stronger than what the Fed expects. If US data gets stronger then US bond yields will rise above 3 percent, he added

02:56pm CRISIL says fiscal deficit may decline by Rs 20,000 crore

CRISIL Research has estimated that the Centre can reduce its fiscal deficit by as much as Rs 20,000 crore this fiscal by using cash reserves of public sector units (PSUs).

By March 31, 2014, the top 20 PSUs, by cash holding, will have an estimated pre-dividend corpus of around Rs.160,000 crore. These companies are comfortably placed to pay special dividends of Rs.27,000 crore over and above their normal dividend payouts, without impacting capex plans.

Without the extra dividends this year's fiscal deficit is expected to be at 5.2% of the gross domestic product (GDP). The Rs.20,000 crore additional income would approximate 20 basis points of the fiscal deficit, which can help the government reach closer to its stated fiscal deficit target of 4.8 percent.

02:46pm JSPL talks to CNBC-TV18
The coal ministry recently cancelled allotment of a coal block in Madhya Pradesh to Jindal Steel & Power and Monnet Ispat & Energy Ltd as they failed to develop it. Speaking to CNBC-TV18 on the issue, Ravi Uppal, JSPL said the company is disappointed with coal ministry's show cause notice for delay in development of coal mines adding that the timeline given to them was not reasonable.

"The de-allocation by the government was a sad development given that the company had been working really hard on the development of those blocks," he said. According to Uppal, the financial loss incurred by the company due to the de-allocation of coal blocks is severe and cannot be quantified.

''JSPL in the whole industry is known do projects in shortest possible time. We are considered to be an icon and if we cannot do that you can be assured nobody else can do better than us,'' he added.

Meanwhile, Uppal said that its Gare Pelma 4/6 coal block is in final stages and the company is waiting for approvals to start mining.

02:36pm LKP Research assigns buy rating on Zee Entertainment

LKP Research has assigned a buy rating on Zee Entertainment Enterprises with a target price of Rs 338 apiece. The brokerage house values the company at 30 times.

"Superior product portfolio, expected surge in subscription revenues on digitization growth in India, higher ad revenues on market share growth in Hindi as well as regional GECs, expected lower sports losses from FY 15E and strong debt free FCF positive balance sheet points towards a robust growth in the value of the stock hereon despite the rally observed recently," LKP elaborated.

02:26pm Monnet Ispat on fire
Shares of Monnet Ispat gained nearly 4 percent as sources say the company recently acquired 25,000 hectares Indonesia coal mine.

It is learnt that the company will start developing Indonesia coal mine in April and sees initial output at 2 million tonne per year from that mine.

02:16pm Consistent buying in banks, capital goods, oil & gas and realty stocks helped equity benchmarks maintain northward journey in afternoon trade.

The Sensex rose 98.92 points to 21178.64, and the Nifty climbed 34.70 points to 6,308.95About 1532 shares have advanced, 856 shares declined, and 158 shares are unchanged.

Shares of ITC , ICICI Bank , Larsen and Toubro , ONGC , Axis Bank , Tata Steel , Sesa Sterlite and Hero Motocorp gained between 1-1.7 percent. Reliance Industries , State Bank of India and Tata Motors rose over 0.7 percent.

Aluminium company Hindalco Industries and state-run capital goods company BHEL topped the buying list, rising 3-3.5 percent.

However, Infosys lost more than 2 percent after V Balakrishnan resigned from Infosys effective December 31. He was head of Infosys BPO and chairman of Infosys Lodestone.2:00 pm FM speaks:Expressing happiness over the growth of the banking sector in the last ten years, Finance Minister P Chidambaram on Monday described it as a great achievement of the UPA rule.

Participating in the '103rd Foundation Day Celebration' of the Central Bank of India here he said, "The very fact that people have accepted the growth of banking sector as a normal phenomenon is a success to me and the government."

"Now the country is having 1,10,000 branches, and every year 7000 to 8000 branches were opened in the last nine years and this year 10,000 branches will be opened.The central bank to commemorate its 103rd foundation day has opened 103 branches today and it will open a total of 231 branches this year," he said.

1:50 pm Commodity update: Gold held steady after its biggest weekly loss in a month, but the metal was still at the risk of falling back below USD 1,200 an ounce as investors fretted over the impact of U.S. stimulus tapering.

Prices were supported in thin Asian trading as holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 5.40 tonnes to 814.12 tonnes on Friday - the first inflow since November 5.

"There seem to be subtle shifts in sentiments for more bullishness after USD 1,200 was broken," said Joyce Liu, an investment analyst at Phillip Futures Pte Ltd.

1:40 pm Stock in news: Hindustan Construction Company (HCC) has bagged a contract worth Rs 1,597 crore from THDC India Ltd to construct the Vishnugad Pipalkoti Hydro Electric Power Project in the Chamoli district of Uttarakhand.

It is an engineering, procurement and construction (EPC) contract for civil works and hydro-mechanical works, including penstock steel liner. The project will be completed in 54 months.

The Vishnugad Pipalkoti project is a project on the Alaknanda river, which is a major tributary of the river Ganga.

1:30 pm Management interview: The coal ministry recently cancelled allotment of a coal block in Madhya Pradesh to Jindal Steel & Power Ltd and Monnet Ispat & Energy Ltd as they failed to develop it. Speaking to CNBC-TV18 on the issue , Ravi Uppal, JSPL said the company is disappointed with coal ministry's show cause notice for delay in development of coal mines adding that the timeline given to them was not reasonable.

"The de-allocation by the government was a sad development given that the company had been working really hard on the development of those blocks," he said. According to Uppal, the financial loss incurred by the company due to the de-allocation of coal blocks is severe and cannot be quantified. ''JSPL in the whole industry is known do projects in shortest possible time. We are considered to be an icon and if we cannot do that you can be assured nobody else can do better than us,'' he added.

Equities may be best asset class over 3 years: DSP BlackRock

Christmas cheer in the Dalal Street continues. The Sensex is up 64.73 points at 21144.45, and the Nifty is up 24.80 points at 6299.05. About 1424 shares have advanced, 775 shares declined, and 138 shares are unchanged.

Hindalco , BHEL , ONGC , Axis Bank and Hero Moto are top gainers in the Sensex. Among the top losers are Infosys , Tata Power , HDFC , M&M and TCS .

UB Group stocks are in focus after Karnataka High Court declares sale transaction by UBHL to Diageo void. United Spirits , though, has recovered from the days lows. Investors are keenly watching tyre companies as import duty on natural rubber has been hiked to Rs 30 per kg from Rs 20/kg.

In the political front, Aam Aadmi Party will form government in Delhi with Congress support. Arvind Kejriwal will be Chief Minister of Delhi and will announce Delhi cabinet in the next one or two days.

12:55pm Tech Mahindra talks to CNBC-TV18

The year 2014 is likely to be better for IT player Tech Mahindra compared to the last three years aided by improved deal pipeline and upbeat US business, vice chairman Vineet Nayyar told CNBC-TV18 in an interview. On business front Europe is striving to become more competitive and cost effective, so Indian IT companies will stand to benefit from that, he said.

He expects Mahindra Engineering Services (MES) merger to play a big role in growth going forward.

Meanwhile, commenting on V Balakrishnan, director and former CFO exit from Infosys, Nayyar said market's view on his exit is a bit exaggerated and one must disassociate individuals from well managed companies, and Infosys is a very well managed company.

12:50pm Market Expert View
Nandan Chakraborty of Axis Capital says the gradual withdrawal of Federal Reserve quantitative easing (QE) is likely to be a mixed bag for India. In the near term, funds flow into India could get hit a bit, impacting the rupee, he adds.

"However, India is in a better position now to withstand the taper as its CAD has shrunk sharply and is expected to cool off to 2.5-2.7 percent of GDP in FY14 and the RBI has built a USD 34 billion buffer from its swap window. Moreover, divestments, spectrum auctions and MNC buyback actions could also act as a pull for overseas flows in the near term," Chakraborty says.

12:40pm Crude Update
Brent crude hit a two-week high near USD 112 a barrel as internal strife in South Sudan threatened the country's oil output, adding to supply woes in Africa.

South Sudan's government said on Sunday rebels had seized the capital of a key oil-producing region. Fears grew of an all-out ethnic civil war in the world's newest country that could cut off its 245,000 barrels per day (bpd) oil output.

This could add to the more than 1 million bpd of lost supply from Libya where key oil ports were shut by a group demanding greater autonomy for the country's eastern part.

February Brent crude edged down 5 cents to USD 111.72 a barrel by 0522 GMT after gaining 2.7 percent last week. It touched a high of USD 111.93 earlier in the session. US crude for February delivery was at USD 99.24 a barrel, down 8 cents, reports Reuters.

12:20pm Movers and Shakers
BHEL , Hindalco Industries , Tata Steel , Axis Bank , Hero Motocorp , DLF , PNB , Jindal Steel and Jaiprakash Associates are top gainers among frontliners, rising 1.5-5 percent.

However, the laggards are Infosys, HDFC , Tata Power , Coal India , TCS and Lupin .

Most active shares are United Spirits , MCX India, HDIL , L&T Finance Holdings, Power Grid Corporation, Infosys, Reliance Industries , ICICI Bank and Bharti Infratel .

12:00pm The market is mildly higher as the Sensex rose 75 points to 21,154.72, and the Nifty climbed 25.05 points to 6,299.30. Advancing shares outnumbered declining ones by a ratio of 1308 to 726 on the BSE.

The year 2013 has been a topsy-turvy year for equities, but going ahead equity is likely to outperform all other asset classes, believes Anup Maheshwari, Executive Vice President & Head of equities, DSP BlackRock Investment Managers. In an interview to CNBC-TV18 he said equities may turn out to be the best asset class over next three years.

Continuing his bullish tone, he said rupee depreciation is positive for exporters and related stocks will continue to do well. He also expects India Inc's financial performance to improve going ahead.

Banks, capital goods, realty, metals, power and oil & gas stocks gained ground while IT stocks are under pressure.

11:50 am Update: Government increased the import duty on natural rubber to up to Rs 30 per kg in order to control the sharp fall in domestic prices and protect interest of about 12 lakh farmers. "In recent months, prices of rubber in the domestic markets have fallen considerably. The fall in prices is stated to be due to increased imports," the Finance Ministry said. The basic customs duty on natural rubber has been increased to Rs 30 per kg or 20 percent, whichever is lower, from Rs 20 a kg or 20 percent whichever was lower.

"Over 12 lakh farmers who are dependent on this crop for their livelihood are to be benefited," the Ministry said.

11:40 am News: Prudent policy and regulatory reforms can help the country's corporate bond market to reach a level of 15 percent of the gross domestic product (GDP) in the current Five Year plan (2012-17), a CII survey said.

"Corporate bond market, which stands below 5 percent of GDP at present, has the potential to reach to a level of 15 percent of GDP during the 12th Five Year plan on back of policy and regulatory reforms," a survey conducted by the industry body on 'Reforming Corporate Bond Market (CBM)' said.

"A robust corporate bond market is imperative to meet the funding needs of the emerging Indian economy. Concerted policy and regulatory reforms in CBM holds the key for the private sector to meet its target share of 47 percent in the total infrastructure investment during the 12th Plan," CII Director General Chandrajit Banerjee said.

11:30 am Market outlook: The year 2013 has been a topsy-turvy year for equities, but going ahead equity is likely to outperform all other asset classes , believes Anup Maheshwari, Executive Vice President & Head of equities, DSP BlackRock Investment Managers.

In an interview to CNBC-TV18 he said equities may turn out to be the best asset class over next three years. Continuing his bullish tone, he said rupee depreciation is positive for exporters and related stocks will continue to do well. He also expects India Inc's financial performance to improve going ahead.

Speaking about his best bets, Maheshwari highlighted that 25 percent of top 500 stocks are still trading under book value. He sees general positive momentum in capital goods and infrastructure sector. From the banking space, he continues to prefer private sector banks over public sector lenders. One can hold both pharma and IT in portfolio from a mid to long-term perspective, he recommended.

Goldman to investors: Stay out of emerging markets

The market maintains upmove as the Sensex is up 97.15 points at 21176.87, and the Nifty is up 30.05 points at 6304.30. About 1224 shares have advanced, 556 shares declined, and 94 shares are unchanged.

Hindalco , BHEL , Axis Bank , Hero Motocorp and Tata Steel are top gainers in the Sensex. On the losing side are Infosys , Bharti Airtel , Coal India , Tata Power and HDFC .

The rupee rises against the US dollar as foreign banks have been selling dollars and on improved sentiment on the back of gains in the equity markets. Government bond prices rise tracking the fall in US treasury yields and on strength in the rupee.

In currencies, dollar index holds steady at 80.5 levels while the euro is flat at 1.36 per dollar levels and the yen remains elevated at 104/ dollar.

Crude prices hold steady despite some concerns about short supplies and reports of improving economic growth in the United States, the world's largest oil consumer and following up on last week's losses. Gold is trading weak near levels of USD 1200/oz.

Asian markets trade mostly higher on thin volumes on account of the Japanese markets remaining shut. Higher borrowing costs in China though continue to plague sentiment.

10:55am United Spirits under pressure
In a setback to the Diageo- United Spirits Ltd (USL) deal, the Karnataka High Court on Friday annulled the sale of USL shares by its parent firm United Breweries Holding Ltd (UBHL) , in light of existing claims of  Kingfisher Airlines' creditors.

Lenders of Kingfisher Airlines had filed a ''winding-up petition'' against UBHL, the corporate guarantor for many of its liabilities.

The court arrived at that judgment after overturning an earlier order that allowed the original share sale in lieu of a deposit.

United Spirits shares fell 3 percent, though the stock recovered 3 percent from day's low.

10:45am Nomura on Crompton Greaves
Nomura upgraded its rating on Crompton Greaves (CRG) to neutral from reduce and increased target price to Rs 139 from 79 earlier.

According to the brokerage house, the worst might be over as far as growth and pricing pressure in the power T&D sector is concerned.

"While this still does not imply anything regarding timelines for a full fledged recovery, which we believe will be long-winded, we note that this is probably the right time to look at Crompton Greaves' international portfolio more constructively," Nomura report said.

"Notably, until now, we along with the street have been assigning negative value to the international business of CRG due to its loss-making nature. However, CRG now seems very confident of achieving break-even in the business by end-FY14 and is also possibly eyeing divestiture of some loss-making entities (such as the Canada plant). Together with the fact that the international peer group trends suggests modest reversals and global economies have bottomed out, while CRG's domestic consumer and industrial businesses remain robust, we upgrade CRG to a neutral rating," the brokerage house elaborated.

10:35am Crude Update
Brent crude rose to a two-week high above USD 111 a barrel as internal strife in South Sudan threatened the country's oil output, adding to supply woes in Africa.

South Sudan's government said on Sunday rebels had seized the capital of a key oil-producing region. Fears grew of an all-out ethnic civil war in the world's newest country that could cut off its 245,000 barrels per day (bpd) oil output.

This could add to the more than 1 million bpd of lost supply from Libya where key oil ports were shut by a group demanding greater autonomy for the country's eastern part.

February Brent crude edged up 1 cent at USD 111.78 a barrel by 0346 GMT after a 2.7 percent gain last week and having touched a high of USD 111.93 earlier in the session. US crude for February delivery edged down 11 cents to USD 99.21 a barrel, reports Reuters.

10:28am FII View
Gautam Shah of JM Financial says that despite four major events going in favor of the bulls, the market is unable to sustain above 6300. "The level of 6150 is the immediate support, which once broken should take the index towards 6030 and then 5950," he adds.

According to him, till the index does not move past 6300 on a closing basis, he will have to maintain a short-term bearish stance. Overall, rallies should only be used to sell, he adds.

10:08am The market maintained positive momentum with the Nifty holding the 6300 level supported by banks, oil and gas and metals stocks.

The Sensex climbed 90.97 points to 21,170.69, and the Nifty rose 27.95 points to 6,302.20. More than three shares advanced for every share declining on the BSE.

Nischal Maheshwari of Edelweiss Securities is positive on the market and expects it to either hold or go up from current levels.

Shares of Hindalco Industries topped the buying list, rising 3.5 percent followed by BHEL with a 2 percent gain.

ICICI Bank , Larsen and Toubro , Tata Motors , ONGC, Tata Steel, Bajaj Auto and Sesa Sterlite rose 1-1.5 percent.

Axis Bank gained 1 percent as the stock added in the Sensex today.

However, Infosys declined more than a percent as head of Infosys BPO and chairman of Infosys Lodestone V Balakrishnan will resign company on December 31.

Though the series of resignations in IT behemoth Infoys is sentimentally a negative development, Maheshwari expects investors to repose their faith in the stock.

He believes given the strong US demand and the rupee, the IT pack is likely to see good days going ahead and hence, recommends investors to buy Infosys  on every dip.

9:50 am News update:In a setback to the Diageo-United Spirits Ltd (USL) deal, the Karnataka High Court on Friday annulled the sale of USL shares by its parent firm United Breweries Holding Ltd (UBHL), in light of existing claims of Kingfisher Airlines' creditors.

Lenders of Kingfisher Airlines had filed a ''winding-up petition'' against UBHL, the corporate guarantor for many of its liabilities.

The court arrived at that judgment after overturning an earlier order that allowed the original share sale in lieu of a deposit. USL is likely to remain volatile in the short term, said a report by brokerage firm Morgan Stanley. It, however, added that it remained ''overweight'' on the stock and that the HC ruling did not change the long-term fundamental view.

9:40 am FII view Gautam Shah of JM Financia says 6150 is the immediate support, which once broken should take the index towards 6030 and then 5950. "Till the index does not move past 6300 on a closing basis, we will have to maintain a short-term bearish stance. Overall, rallies should only be used to sell," he adds.

Nandan Chakraborty of Axis Capital feels gradual withdrawal of Federal Reserve quantitative easing (QE) likely to be a mixed bag for India. In the near-term, funds flow into India could get hit a bit, impacting the rupee. "However, India is in a better position now to withstand the taper as its current account deficit has shrunk sharply and is expected to cool off to 2.5-2.7 percent of gross domestic product in FY14. Moreover, divestments, spectrum auctions and MNC buyback actions could also act as a pull for overseas flows in the near term," he says.

9:30 am Market data: Nine of the top 10 Sensex companies added Rs 57,183 crore in market value last week, with IT majors TCS and Infosys emerging as the biggest gainers.

TCS and Infosys together accounted for more than half of the gain. The market capitalisation (m-cap) of TCS climbed Rs 22,849 crore to Rs 4,15,162 crore, while that of Infosys jumped Rs 10,247 crore to Rs 2,03,985 crore.

Reliance Industries added Rs 9,791 crore in value to Rs 2,88,760 crore. Wipro's m-cap surged Rs 7,400 crore to Rs 1,35,342 crore, while ONGC 's value rose Rs 3,294 crore to Rs 2,43,275 crore.

9.24 am Market check: The market has gained momentum as Nifty hits 6300. The Nifty is up 33.15 points at 6307.40 while the Sensex gains 120.40 points to be at 21200.12. About 661 shares have advanced, 180 shares declined, and 43 shares are unchanged.

The market has opened on a flat note. The Sensex is up 7.15 points at 21086.87, and the Nifty down 3.30 points at 6270.95. About 293 shares have advanced, 93 shares declined, and 16 shares are unchanged.

Infosys is reacting negatively (down 1 percent) as its top management exodus continues since V Balakrishnan, director, resigned to start his own private equity firm. This is the eight top level exit at Infosys since June. Balakrishnan told CNBC-TV18 that his exit has nothing to do with Narayana Murthy's return.

Banking stocks are also weak today with pressure seen in HDFC Bank and SBI . Other losers in the Sensex are Tata Power and Sesa Sterlite. On the gaining side are Hindalco , Bajaj Auto , L&T, NTPC and ONGC.

Meanwhile, the rupee opened at 62.07 against the US dollar on Monday, down 3 paise compared to Friday's closing value of 62.04 per dollar. The dollar index held above the 80.50 mark. Meanwhile the dollar-yen continued to trade around 104 level.

In commodities, Brent Crude prices rise with Nymex following suit, supported by refinery outages in the United States that will boost the need for gasoline imports linked to the global benchmark, and on reduced Libyan supply.

And from the precious metals space, gold ticked up on Monday after its biggest weekly loss in a month, but the metal was still at the risk of falling back below USD 1,200 an ounce as investors fretted over the impact of a US stimulus tapering.

The US gross domestic product (GDP) for Q3 came in better-than-expected propelling the markets higher and the Dow and S&P 500 closed at record highs. The US markets notched up 2-3 percent gains for the week. European markets too record their best week in eight months and Asian markets opened modestly higher in early trade.