Sensex ends lower, Nifty ends at 7556; banks & auto drag, ITC up

3:30 pm Market Closing: Equity benchmarks closed marginally lower ahead of RBI policy. A CNBC-TV18 poll sees no change in policy rates.

The 30-share BSE Sensex declined 45.86 points to 24824.83 and the 50-share NSE Nifty dropped 7.60 points to 7555.95.

The broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising 0.6 percent and 0.3 percent, respectively. About 1422 shares advanced against 1264 declinnig shares on the BSE.

ICICI Bank crashed 5.6 percent. SBI, Maruti Suzuki, Axis Bank, HUL and Bank of Baroda were down 2-4 percent while Adani Ports, Coal India, Bharti Airtel, Cipla, L&T, Yes Bank and ACC gained 2-4 percent.

2:58 pm Market Update: The Sensex declined 35.87 points to 24834.82 and the Nifty fell 7 points to 7556.55.

About 1407 shares have advanced, 1236 shares declined, and 152 shares are unchanged on the BSE.

2:40 pm Sugar exports: Indian sugar mills have contracted to sell one million tonnes of sugar in the 2015/2016 season and expect to sign deals for another million tonnes this season as exports head for China, the president of an industry body said on Monday.

"One million tonnes have been contracted and another one million tonnes will be contracted," Tarun Sawhney, president of the Indian Sugar Mills Association told a conference in Dubai.

Of the total 1 million tonnes contracted, around 700,000 tonnes have already moved out of the country.

Sawhney said many of the current and future contracts were with Myanmar, where they are expected to be smuggled into China, the world's top importer.

2:20 pm Bajaj Auto's new bike: Bajaj Auto on Monday unveiled a 150 cc bike 'V', which contains metal from India's first aircraft carrier INS Vikrant.

The commuter segment bike is expected to be priced between Rs 60,000 to Rs 70,000 (ex-showroom Delhi). Sales of the bike would commence from March and the final pricing would be announced at that time.

"The Bajaj V shall usher a new era in commuter motorcycling. We believe the Indian customer buying a commuter motorcycle deserves something that is substantial, solid, and which moves with a sense of purpose," Bajaj Auto President (Motorcycle Business) Eric Vas told reporters.

2:00 pm Market Check
The market continued to consolidate with the Nifty hovering around 7560 level. The broader markets retained outperformance with the BSE Midcap and Smallcap indices rising 0.4-0.6 percent.

The 30-share BSE Sensex declined 0.42 points to 24870.27 and the 50-share NSE Nifty rose 2.90 points to 7566.45. The market breadth was positive as about 1412 shares advanced against 1182 declining shares on the BSE.

Global markets traded mostly in the red. China closed with losses of more than 1.5 percent while European markets too opened in the red.
 
Maruti Suzuki slipped 3 percent after its sales hit a 9-month low in January. Exports hit a 15-month low. Eicher Motors gained more than 2 percent, with Royal Enfield sales growing 65 percent in January. Ashok Leyland too reacted positively to a 30 percent jump in overall sales, up 3 percent.

SBI tanked more than 3 percent. Morgan Stanley is worried about State Bank of India 's bad loan and has reduced target price to Rs 115 per share, implying 36 percent downside. It has also cut earnings per share (EPS) by 28-35 percent.

1:55 pm Auto sales: Hyundai Motor India (HMIL) today reported 1.23 percent dip in total sales at 44,230 units in January.

The company had sold 44,783 units in the same month last year, HMIL said in a statement. In the domestic market, the company sold 38,016 units last month compared with 34,780 units in January 2015, up 9.3 percent.

However, the company's exports declined by 37.87 percent to 6,214 units as against 10,003 units. HMIL senior Vice-President (Sales and Marketing) Rakesh Srivastava said the company has started the year on a positive note registering the domestic volume of 38,016 units with a growth of 9.3 percent over last year.

1:45 pm Brokerage view: Morgan Stanley is worried about State Bank of India 's bad loan and has reduced target price to Rs 115 per share, implying 36 percent downside. It has also cut earnings per share (EPS) by 28-35 percent. The brokerage feels that average return on equity (ROE) of 7 percent (first half of FY16-FY17) and high capital need will keep stock under pressure. It has an underweight rating on the stock. Shares of SBI fell 2 percent intraday on Monday. The brokerage says that increasing bad loan formation may reflect RBI's action on non-performing loans taking credit costs to 175 basis points in F16/F17. "Following ICICI Bank's earnings, we are building in much higher NPL formation estimates for the SBI parent up at Rs 35000 crore for first half of FY16 from earlier Rs 15000 crore. We also expect about Rs 10000 crore of restructured loans to be classified as perennial restructuring - implying higher provisioning at 15 percent than the current 5 percent," Morgan Stanley says in a note.

1:30 pm Warning letter: Ipca Laboratories said US Food and Drug Administration has issued a warning letter to three manufacturing units situated at Ratlam (Madhya Pradesh), SEZ Infore (Pithampur) and Piparia (Silvassa). The company already received import alerts on these manufacturing units after certain inspection observations in Form 483. Since July 2014, it has voluntarily suspended shipments of its APIs and formulations for the US market till USFDA inspection observations are resolved.

The market has cooled off a bit from early gains. The Sensex is up 30.35 points or 0.1 percent at 24901.04, and the Nifty up 12.10 points or 0.2 percent at 7575.65. About 1423 shares have advanced, 1050 shares declined, and 126 shares are unchanged.

Adani Ports, Cipla, L&T, Bharti Airtel and HDFC Bank are top gainers while ICICI Bank, Maruti, SBI, Axis Bank and HUL are among losers in the Sensex. Maruti Suzuki has started its 2016 sales performance on a disappointing note. The country's largest car manufacturer sold 1.13 lakh vehicles in January, down 2.6 percent compared to 1.16 units sold in same period last year, it said in its filing on Monday.

Gold prices rose by Rs 50 to Rs 26,688 per 10 gram in futures trade after speculators widened positions amid a better trend overseas.

Analysts said the rise in gold prices at futures trade was mostly in tune with a firming trend overseas after data showed a further contraction in China's manufacturing, adding to the case for safe-haven assets as investors boost holdings.

12:58 pm Market Update: The Sensex rose 30.35 points to 24901.04 and the Nifty went up 12.10 points to 7575.65.

About 1423 shares have advanced, 1050 shares declined, and 126 shares are unchanged on the BSE.

12:45 pm Rate cut possible?: Bank shares have remained a pain point for the stock market over the past one year -- beset by NPA issues and weak credit demand -- and the pain is likely to continue for a while, says Andrew Holland of Ambit Investment Advisors.

He lamented that the Finance Minister could have "done a lot more" to clean up the banking system. On the positive side, he said the Reserve Bank could cut repo rate by 25 basis points, something that could surprise the market.

12:25 pm USFDA warning letter: Ipca Laboratories said US Food and Drug Administration has issued a warning letter to three manufacturing units situated at Ratlam (Madhya Pradesh), SEZ Infore (Pithampur) and Piparia (Silvassa). The stock fell 16.3 percent intraday to hit 52-week low of Rs 560 but managed to recover some losses because it already priced in, especially when these units got import alerts.

The company already received import alerts on these manufacturing units after certain inspection observations in Form 483.

Since July 2014, it voluntarily suspended shipments of its APIs and formulations for the US market till USFDA inspection observations are resolved.

12:00 pm Market Check: Equity benchmarks continued to be volatile with a positive bias while the broader markets retained outperformance in noon trade. Healthcare, technology, HDFC group and select infra stocks saw buying interest while banks remained under pressure.

The Sensex went up 42.78 points to 24913.47 and the Nifty rose 17.05 points to 7580.60. The BSE Midcap and Smallcap indices gained nearly 0.7 percent. The market breadth was also strong as about 1469 shares advanced against 912 declining shares on the BSE.

Oil prices dropped after China and South Korea posted surprisingly weak economic data, while fading prospects for a coordinated production cut by leading crude exporters also dragged on the market.

Economic data from China, showing its manufacturing sector contracted at its fastest pace in almost three-and-a-half years in January, added to worries about demand from the world's top energy consumer at a time when the market is already weighed down by a supply overhang.

Numbers coming out of South Korea were also gloomy, with the country's exports down at levels last seen at the height of the global financial crisis in 2009. Brent crude declined 2.25 percent to USD 35.18 a barrel and US oil slipped 2.4 percent to USD 32.82 a barrel.

11:55 am auto sales: Maruti Suzuki has started its 2016 sales performance on a disappointing note. The country's largest car manufacturer sold 1.13 lakh vehicles in January, down 2.6 percent compared to 1.16 units sold in same period last year, it said in its filing on Monday. The stock declined 3 percent intraday. It was impacted not only by weak exports but also by low sales of mini (Alto, WagonR) and Compact cars (Swift, Ritz, Celerio, Baleno and Dzire). Maruti exported 7,223 vehicles during the month, lower by a whopping 34.6 percent compared to 11,047 vehicles sold in year-ago period while domestic sales increased 0.8 percent to 1.06 lakh vehicles in same period.

11:45 am Market outlook: After its mega disinvestment plan appears to have come a cropper in fiscal year 2015-16, the government is expected to set out a more realistic target of Rs 40,000 crore in fiscal year 2017, sources have told CNBC-TV18. The plan, sources said, will focus on front-loading stake sales in FY17 and a Cabinet nod to 29 companies is already in place. Further, the government is set to provide greater clarity on strategic sales, something that was confirmed by Divestment Secretary Neeraj Gupta in an interview with CNBC-TV18 -- after it has all but missed its target this year.

11:30 am Market outlook: Bank shares have remained a pain point for the stock market over the past one year- beset by NPA issues and weak credit demand -- and the pain is likely to continue for a while, says Andrew Holland of Ambit Investment Advisors. In an interview with CNBC-TV18, Holland said he expects more downgrades for names such as SBI and even a private sector lender such as ICICI could see its asset growth drag on for yet another quarter. He lamented that the Finance Minister could have "done a lot more" to clean up the banking system. On the positive side, he said the Reserve Bank could cut repo rate by 25 basis points, something that could surprise the market.

The market is still firm as the Nifty is away from 7600. The 50-share index is up 24.45 points or 0.3 percent at 7588 and the Sensex is up 78.19 points or 0.3 percent at 24948.88.About 1481 shares have advanced, 738 shares declined, and 100 shares are unchanged.

L&T, Adani Ports, Cipla, Wipro and Lupin are top gainers while ICICI Bank, Maruti, SBI, Axis Bank and Coal India are losers in the Sensex.

Indian manufacturing sector growth rose to a four-month high in January driven by rising inflows of new business orders from domestic as well as export clients, says a Nikkei survey.

Following the contraction in December in the wake of Chennai floods, January saw the Indian manufacturing sector rebound into expansion territory, as production and new orders recovered, the report said. The Nikkei India Manufacturing PMI, a composite monthly indicator of manufacturing performance, stood at 51.1 in January, up from 49.1 in December.

Oil prices dropped early after China and South Korea posted surprisingly weak economic data and on worries the prospect of a coordinated production cut by leading crude exporters seemed remote.

10:55 am Maruti in focus: Maruti Suzuki has started its 2016 sales performance on a disappointing note. The country's largest car manufacturer sold 1.13 lakh vehicles in January, down 2.6 percent compared to 1.16 units sold in same period last year, it said in its filing today.

It was impacted not only by weak exports but also by low sales of mini (Alto, WagonR) and Compact cars (Swift, Ritz, Celerio, Baleno and Dzire).

Maruti exported 7,223 vehicles during the month, lower by a whopping 34.6 percent compared to 11,047 vehicles sold in year-ago period while domestic sales increased 0.8 percent to 1.06 lakh vehicles in same period.

10:40 am Market Update: The 50-share NSE Nifty touched 7600 level, up 24.55 points to 7588.10. The 30-share BSE Sensex rallied 72.54 points to 24943.23.

About 1445 shares advanced against 666 declining shares on the BSE.

10:20 am Morgan Stanley on SBI: Morgan Stanley is worried about State Bank of India 's bad loan and has reduced target price to Rs 115 per share, implying 36 percent downside. It has also cut earnings per share (EPS) by 28-35 percent. The brokerage feels that average return on equity (ROE) of 7 percent (first half of FY16-FY17) and high capital need will keep stock under pressure. It has an underweight rating on the stock. Shares of SBI fell 2 percent intraday.

The brokerage says that increasing bad loan formation may reflect RBI's action on non-performing loans taking credit costs to 175 basis points in F16/F17. "Following ICICI Bank's earnings, we are building in much higher NPL formation estimates for the SBI parent up at Rs 35000 crore for first half of FY16 from earlier Rs 15000 crore. We also expect about Rs 10000 crore of restructured loans to be classified as perennial restructuring - implying higher provisioning at 15 percent than the current 5 percent," Morgan Stanley says in a note.

10:00 am Market Check
The market gained marginal strength amid volatility, aided by infra, HDFC group, technology and pharma stocks. However, banks and oil stocks were under pressure.

The 30-share BSE Sensex rose 62.88 points to 24933.57 and the 50-share NSE Nifty climbed 26.35 points to 7589.90. The broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising 0.5 percent and 0.9 percent, respectively.

About two shares advanced for every share declining on the Bombay Stock Exchange.

Larsen & Toubro surged 4 percent following Q3 earnings. With maintaining outperform on stock and target of Rs 1469, Macquarie says given the investors concerns, broadly maintaining guidance is a positive outcome and stock is likely to see a bounce back.

HDFC Bank, Infosys, Lupin, Adani Ports, Wipro, Cipla, Bharti Airtel and BHEL were up 1-2 percent while ICICI Bank fell 3 percent.

9:55 am Market check: The Sensex is up 23.83 points or 0.1 percent at 24894.52, and the Nifty up 11.20 points or 0.1 percent at 7574.75. About 1191 shares have advanced, 552 shares declined, and 66 shares are unchanged.

L&T, Adani Ports, Cipla, Lupin and Wipro are top gainers in the Sensex. ICICI Bank, Hero, GAIL and Coal India are losers.

9:45 am FPI data: Overseas investors pulled out more than Rs 11,000 crore from the Indian stock markets in January - the highest net outflow in five months - on global growth worries and decline in oil prices.

However, these investors continue to remain bullish on the Indian debt market and invested a net amount of Rs 2,313 crore during the period.

According to a data available with depositories, Foreign Portfolio Investors (FPIs) infused a gross amount of Rs 70,742 crore into equity markets, while pulling out Rs 81,868 crore during the same period, resulting in a net outflow of Rs 11,126 crore (USD 1.65 billion).

9:30 am Result poll: Tech Mahindra is likely to report mute December quarter earnings. According to CNBC-TV18 poll, the IT company's net profit may slip 3.6 percent at Rs 757 crore in Q3FY16 from Rs 785.6 crore on sequential basis. Its dollar revenue is likely to be  marginally up 0.9 percent at USD 1020 million versus USD 1011 million while rupee revenue may jump 1.7 percent at Rs 6728 crore versus Rs 6616 crore quarter-on-quarter.

Revenue growth in Q3 is seen at 1 percent while constant currency growth may be at 1.5 percent.

In Q3, EBIT is seen at Rs 956 crore against Rs 903.7 crore and EBIT percentage at 14.2 percent versus 13.65 percent (QoQ).

The market has opened on a flat note. The Sensex is up 38.58 points at 24909.27, and the Nifty is up 24.90 points or 0.3 percent at 7588.45. About 506 shares have advanced, 105 shares declined, and 31 shares are unchanged.

L&T, Lupin, BHEL, SBI and Axis Bank are top gainers while Hero, ICICI Bank, ITC, NTPC and Dr Reddy's Labs are losers in the Sensex.

The rupee opened flat at 67.77 per dollar against Friday's close of 67.78.

Agam Gupta of Standard Chartered said, "The risk sentiment remains positive due to the negative interest rates announced by Bank Of Japan last week. We expect a range of 67.60-67.95/dollar for the USD-INR today."

The dollar rose sharply on Friday, hitting a six-week high versus the yen, after the Bank Of Japan took one of its main interest rates into negative territory and US gross domestic product data largely matched economists' expectations.

Asian shares started a new month on somewhat firmer footing, helped by accommodative monetary policies in Japan and Europe, but traders were cautious ahead of China factory and service sector activity surveys.

A rebound in oil prices last week also helped sentiment, though Brent crude fell about 1 percent in early Asia trade.

Oil prices dropped after China and South Korea posted surprisingly weak economic data and on worries the prospect of a coordinated production cut by leading crude exporters seemed remote.