Sensex, Nifty end flat; autos up on extension of lower tax

03:45 pm Coal supply: With Coal Ministry rejecting the Power Ministry's request to provide fuel to 9940 MW plants of companies like Essar Power, GMR and Power, the latter has sought intervention of Coal and Power Minister Piyush Goyal into the matter.

A list of "similarly placed projects" of 4095 MW was sent to the coal ministry for supply of coal...Further 5845 MW has coal blocks, but mining is delayed by one-two years...Hence tapering linkages needs to be given for one-two years, but Ministry of Coal has rejected it on the ground that they have coal blocks," according to an official document.

The Cabinet had in June, last year decided that coal may be supplied to similarly placed projects without affecting 78,000 MW of power projects. The criteria for similarly placed, among other things, state that the plants should be commissioned before March, 2015 and Power Purchase Agreements (PPAs) should be signed, it said.

03:35 pm Market closing: After a volatile session, the market ended on a flat note with negative bias. The Sensex was down 55.16 points at 25313.74 and the Nifty shut at 7569.25, down 10.95 points. About 1689 shares advanced, 1344 shares declined and 110 shares were unchanged.

Auto stocks zoomed just as the FM announced extenssion of lower excise duty. Bajaj Auto was up 3 percent and Maruti gained 2 percent. GAIL, Coal India and SBI were other gainers in the Sensex.

On the losing side were ONGC, ITC, Bharti, ICICI Bank and L&T.

03:20 pm Sops: The government has extended lower excise duty on auto, capital goods and consumer goods for another six months (till December end). Making the announcement, FM Arun Jaitley said that the government expects lower excise duty extension to aid economic recovery.

Auto stocks rally in the last few minutes left for trade to close.

03:10 pm Retail participation: Domestic institutional investors (DIIs) who were record sellers in 2013 are likely to become net buyers in the second half of this year, according to a report.

"We strongly believe that the record DII selling witnessed in 2013 should abate sharply in 2014," Deutsche Bank said in a note. However, the report said while DII selling has continued in 2014, the pace of this selling has slowed sharply so far this year at around 38 percent as against the same period in 2013.

"For DII flows to turn positive, inflows from insurance companies remain critical, which may turn around early H2 as investors of unit-linked products (Ulips) recognise the strength in market," the report said.

02:55pm Divestment
The finance ministry is keen to push divestment of public sector companies on better valuations and comply with percent public shareholding recommended by market watchdog Sebi, reports CNBC-TV18 quoting sources.

CNBC-TV18 has learnt from sources that finance ministry is aggressively pushing for 5 percent stake sale in ONGC, REC, PFC as part of its FY15 divestment plan.

Sources say a Cabinet note has been floated for 10 percent divestment in Container Corporation and NHPC as well.

Meanwhile, Finance Minister Arun Jaitley has said he may announce minor tariff changes outside Budget later today.

02:40pm Brent slips further
Brent crude slipped below USD 114 a barrel as the risk of supply disruption in Iraq appeared to recede and after a rise in US inventories pointed to ample stockpiles for the world's biggest oil consumer.

Oil has made sharp gains in the past two weeks as concerns over fighting in Iraq, OPEC's second-largest producer and exporter, pushed the North Sea benchmark above USD 115, its highest since September.

But with exports from Iraq's southern terminals running near record levels and most of the country's oilfields in the peaceful south, far away from the Sunni insurgency, worries about supply have been easing.

Brent dropped 60 cents to USD 113.86 a barrel by 0755 GMT. Prices, up almost 6 percent over the past two weeks, have receded from a nine-month top of USD 115.71 reached on June 19, reports Reuters

02:25pm Engineers India on buyers' radar
Engineers India says Ministry of Heavy Industries and Public Enterprises, Department of Public Enterprises (DPE) vide its letter dated June 24, 2014, has informed that the Government has decided to grant Navratna Status to company.

02:10pm Market Expert
The recent rally in the market can at best be called volatile. Sanju Verma of Violet Arc Global Managers does not expect a pre-Budget rally, but feels Nifty will rally to 8000 post Budget. She feels the rally so far has been more aspirational than anything else.

According to her, the Narendra Modi government is getting crushed under the weight of expectations.

02:00pm Equity benchmarks fell marginally amid volatility in afternoon trade. The Sensex declined 60.70 points to 25308.20 and the Nifty lost 14.25 points to 7565.95. About 1599 shares have advanced, 1307 shares declined, and 112 shares are unchanged.

Shares of ITC, ICICI Bank, Larsen & Toubro, ONGC and Bharti Airtel dropped more than a percent. Reliance Industries, HDFC Bank, Axis Bank, Sesa Sterlite and Wipro slipped over 0.5 percent.

However, Bajaj Auto topped the buying list, rising 2.2 percent. Jefferies maintains hold rating on the stock with a target of Rs 2178. The brokerage believes rising e-rickshaws may impact 3-wheeler sales.

State Bank of India, Tata Motors, Sun Pharma, Coal India, Tata Power and Gail gained 1-1.6 percent. TCS and Infosys were up 0.36 percent each.

In the midcap space, Jagran Prakashan, Greaves Cotton, Engineers India and Britannia rallied 5-7 percent while Essar Oil, Natco Pharma, Sanofi India, Linde India and BF Utilities lost 3-5 percent.

1:50 pm Debt woes: Deepak Narang, executive director, United Bank of India says the bank has a good case of wilful defaulting on the part of beleagured Kingfisher Airlines . In an interview to CNBC-TV18, Narang says that the bank had given the company time until June 28 to present its case before a committee. However, the company has sought more time, so the hearing may now happen in the first week of July, adds Narang.

While UBI doesn't have any United Spirits ' shares- a company promoted by Kingfisher's Vijay Mallya – the State Bank of India consortium does have the same as collateral against the loans lent to KFA.

1:40 pm FDI: Fast Retailing Co Ltd's Uniqlo, Japan's largest clothing store chain, is looking to source garments from India, Uniqlo's Chairman Tadashi Yanai told Indian Prime Minister Narendra Modi, according to a government statement.

Modi welcomed Unqilo's interest in developing its business in India and highlighted the benefits the country's garment sector offers, the statement.

Uniqlo has long been eyeing the Indian market to open its stores and industry officials said it is a likely step in that direction. Officials with Uniqlo could not immediately be reached for comment and the Indian government statement gave no further details.

Fast Retailing, Asia's top apparel retailer, has manufacturing partners in China, Vietnam, Bangladesh and Indonesia.

1:30 pm Market outlook: Despite concerns on monsoon and oil price front, the market is still trading at these levels, which suggests expectation is building on the Budget, says Dipan Mehta, member BSE and NSE. In case there is any positive news flow on these two fronts, there is a likelihood of a pre-Budget rally, he adds.

The steps taken in the past month suggests that the new government may come out with some fresh ideas in the Budget, he opines.

But, according to him, now there is an event risk, if expectations are not met, then there is a possibility of a 5-10 percent decline on indices and stock prices.

Sectorally, he says with the fall in the rupee, some more weightage has gone to export-oriented sectors.

1:20 pm Buzzing: Shares of Indian Hotels jumped to 49-month high at Rs 109.75 per share, up 4 percent intraday as it firms up its fund raising plans.

The company will issue 9 compulsorily convertible debenture (CCD) for every 40 equity shares to raise up to Rs 1,000 crore via rights issue. The rights issue committee has fixed price at Rs 55 per CCD.

The CCDs will be converted into equity shares after 18 months from the date of allotment. No interest shall be paid and there will be no redemption while the CCDs will be unsecured CCD.

''The conversion price shall be adjusted for any bonus or rights issue made by the company prior to the conversion date so as to ensure that the benefit of the CCD holder is not prejudiced and remains the same as if the conversion of the CCDs into the equity shares had been undertaken prior to such bonus or rights issue,'' the company said in a statement to BSE.

The market is subdued with negative bias. The Sensex is down 48.65 points at 25320.25 and the Nifty is down 8.45 points at 7571.75. About 1504 shares have advanced, 1273 shares declined and 120 shares are unchanged.

Banks and oil & gas stocks drag the market lower while healthcare and auto stocks trade in the green. Midcaps continue their outperformance, trading higher than the benchmark indices.

HDFC Bank is in focus today as the bank seeks shareholder nod to raise Rs 10,000 crore which will be taken up in the AGM today. The bank is looking at equity dilution of 5 percent of market cap.

Asian markets trade lower as Iraq concerns over better-than-expected US housing and consumer confidence data.

Rupee is at a one-week low tracking Asian currencies as escalating tensions in Iraq raise fears of a spike in crude oil prices. Month-end dollar demand from importers also weighs on the rupee.

12:55pm Strides Arcolab on buyers' radar
Strides Arcolab announced that it has received ANDA approval from the United States Food and Drug Administration (USFDA) for Imiquimod cream. The stock gained 3.5 percent.

According to IMS data, the US market for generic Imiquimod cream is approximately USD 140 million. This is the first product approval from Beltapharm, the company's USFDA approved semi solids facility in Milan, Italy.

The product will be marketed directly by Strides in the US market.

Imiquimod cream is a topical skin cream indicated for the treatment of certain types of actinic keratoses (precancerous skin lesions) on the face or scalp, and external genital and perianal warts in patients 12 years and older.

12:45pm AstraZeneca in news
AstraZeneca Pharma fell over a percent after the promoters' efforts to delist the company from the Indian bourses is being investigated by Sebi.

The capital markets regulator found preliminary evidence of "concerted action" between the company and a FII called the Elliott Group during an offer for sale (OFS) in May 2013 in order to ensure that the ongoing delisting succeeds even if none of the retail investors tender their shares.

12:35pm Bharat Forge gains 1%
Brokerage house Barclays maintains overweight rating on Bharat Forge and raises target price to Rs 764 apiece from Rs 526 earlier.

12:25pm Interview
MS Unnikrishnan, MD, Thermax believes the government's decision to club coal, power ministries is a very wise one.

''The government has now started understanding the pros and cons of the industry and it is thinking of what can be done to give a fillip to it,'' says Unnikrishnan who believes the study of the Gujarat model by power minister Piyush Goyal is both positive and promising.

However, now the need is for effective execution from the government and a faster pace in awarding project clearances, adds Unnikrishnan.

12:10pm Market Expert
There is a great deal of optimism about India, but at the same time, there is also concern about the pace of reforms, feels Saurabh Mukherjea of Ambit Capital.

In an interview with CNBC-TV18, Mukherjea says investors will be watching for meaningful reforms beyond fiscal consolidation. The FY15 fiscal deficit target will be one of most closely tracked number in the upcoming Budget, but more important will be the roadmap for achieving the target, he says.

12:00pm Equity benchmarks remained directionless ahead of June series expiry for derivative contracts. The Sensex fell 27.29 points to 25341.61 and the Nifty slipped 7.20 points to 7573 but the BSE Midcap and Smallcap indices gained 0.4 percent each.

About 1432 shares have advanced, 1166 shares declined, and 135 shares are unchanged.

Top telecom operator Bharti Airtel dropped over 2 percent followed by ICICI Bank and ITC with 1 percent. Shares of ONGC, Axis Bank, L&T, HDFC Bank, Wipro, Sesa Sterlite and Maruti Suzuki declined marginally.

However, Bajaj Auto kept its top position in the buying list, up 2 percent. Gail, Coal India, Tata Power and Tata Motors rose 1 percent each.

Godrej Properties was the most active stock on the BSE after 17 lakh shares of the company exchanged at Rs 238.60 apiece through a block deal. Ceat, SBI, Tata Motors (DVR), Nalco, ONGC, HDFC and IRB Infrastructure were other most active shares on exchanges.

12:00 pm Game plan: IT major Infosys seems to be in full-throttle mode after Vishal Sikka was named the company's chief executive officer. The company has in its meet addressed a whole host of issues ranging from performance reviews to pricing.

The company today addressed the need to identify leaders and create a proper performance-appraisal mechanism. In its largest ever performance review- across geographies and verticals, Infosys has spelt out the need to review under-performers.

In a move to give the company a well-needed impetus, it is looking to beef-up its US team that will oversee all government business. The move is attempted at facilitating smooth talks between the company and the US government. Infosys is also working to strengthen its platform and products division and about 100 employees are expected to be added to the same. The team will report directly to Sikka and will focus on creating differentiated software products and review partnerships with its existing partners.

11:50 am Oil check: Brent crude inched lower, but held close to a nine-month high above USD 114 a barrel as Sunni insurgents battled government forces for control of Iraq's biggest refinery.

The 300,000 barrel per day Baiji complex, 200 km (120 miles) north of Baghdad, has been fought over since last Wednesday with sudden reversals on both sides.

But a lack of fresh threats to output from OPEC's second largest oil producer curbed prices.

"Markets have already factored in the Iraq situation - unless something more chaotic happens. The threat of supply disruptions is receding," said Avtar Sandu, senior commodities manager at Singapore's Phillip Futures.

11:40 am Budget hope: Discussing the Budget expectations for the infrastructure sector, Vinayak Chatterjee, Chairman of Feedback Infra, said the infra companies want the government to keep them out of the MAT (minimum alternate tax) ambit.

''It is seen by the entire sector as patently irrational and illogical for the simple reason that on one hand you give a 10-year tax holiday and on the other you impose Minimum Alternate Tax (MAT) which is close to 21 percent,'' he said.

He even said the industry wants the government to announce a ''10-year tax holiday applicable to infrastructure projects at least for the next 20 years''.

11:30 am Buzzing: Shares of Parsvnath Developers rallied as much as 5 percent intraday after the realty firm said it plans to either sell the Rs 1,000-crore worth land parcels in South-West India or form joint ventures with local builders for development.

"We are planning to monetise our land parcels in southern and western part of the country in cities like Chennai, Hyderabad, Kochi, Goa, Mysore and Palghat. We will sell these plots if we get a good price or form joint ventures with local developers," Parsvnath Developers Chairman Pradeep Jain said.

Parsvnath has 85 acres land in Kochi, of which 50 percent has already been notified as Special Economic Zone and process for the next half is in progress. It has 35 acres in Chennai and 75 acre in Mysore. Jain said the company is in discussion with the potential buyers for some of the assets.

11:20 am Market outlook: The recent rally in the market can at best be called volatile. Sanju Verma of Violet Arc Global Managers does not expect a pre-Budget rally, but feels Nifty will rally to 8000 post Budget. She feels the rally so far has been more aspirational than anything else.

According to her the Narendra Modi government is getting crushed under the weight of expectations.

She likes L&T and Hero MotoCorp among large caps, but believes the best is yet to come for BPCL . She says ex-valuation of Brazilian gas field, BPCL valuation is cheap. ''Increase in marketing margins for BPCL will be phenomenal. Also, capital appreciation will fuel rally in stocks like BPCL,'' she adds. As of now, she does not think investors should play BPCL for dividend yield alone.

Verma also believes Arvind is a good play on business restructuring.

The market seems to be consolidating just before June series expiry. The Nifty is down 4.90 points at 7575.30 and the Sensex is down 16.05 points at 25352.85. About 1387 shares have advanced, 968 shares declined, and 107 shares are unchanged.

Bajaj Auto, Coal India, GAIL, Tata Power and NTPC were top gainers in the Sensex. Among the losers are Bharti, ICICI Bank, Reliance, ITC and ONGC.

The rupee is trading at 60.26/27 versus its previous close of 60.1325/1425, tracking the dollar's gains versus most other Asian currencies as the violence in Iraq continues to raise fears of a further rise in global crude oil prices. Month-end dollar demand from oil firms is also expected to keep an upward pressure on the pair.

Almost all Asian currencies slide against the dollar.

Asian shares were on the back foot early, taking cues from Wall Street as the deepening crisis in Iraq and a report that the US could be loosening restrictions on crude exports triggered a rally in oil prices.

10:55am FII View
Bharat Iyer, JP Morgan says expectations are running high that the new NDA Government will liberalise policy to attract increased FDI to boost growth and employment in the forthcoming Union Budget. The brokerage house believes the sectors where there is scope for meaningful liberalisation in FDI policy are insurance and defense, he adds.

He further says, ''Another potentially easy win, in our opinion, for the government would be to allow portfolio investments in private sector banks upto 74 percent under the automatic route. ''On balance, we maintain that ease of doing business would remain an important determinant of attracting meaningful FDI,'' he adds.

10:45am Fuel price hike likely?
After the Railway fare hike, the Modi government is set to bite the bullet on cutting fuel subsidies. According to sources, the Centre is planning a staggered hike in prices of LPG and kerosene on the lines of marginal monthly hike in diesel prices.

In an interview to CNBC-TV18, Kirit Parikh, member of Planning Commission and Chairman of Integrated Research and Action for Development, said he hopes the government increases the prices as kerosene is currently being sold at Rs 11/litre, when the cost should be around Rs 33-34 per litre.

"I think we can continue with this monthly hike of Rs 1 for kerosene but within a couple of years or so, I hope the government switches over to a direct cash transfer," Parikh said, adding that following the Gujarat Model if the government can successfully provide 24X7 electricity then kerosene consumption can come down, and it can eventually do away with the subsidy. 

On the proposal related to increasing Rs 5 per cylinder, Parikh said that the hike may not pinch that much as LPG users are "relatively better off." He, however, feels that Rs 5 hike is too small to make a difference and thinks the government could have looked at Rs 10/cylinder hike per month.

10:35am Interview
Hailing the central bank's move to permit non banking finance companies to act as business correspondents (BCs) of banks, Umesh Revankar, managing director, Shriram Transport Finance Company says the move will enhance the financial inclusion programme.

Speaking to CNBC-TV18, Revankar says the deposit taking NBFCs, however won't be able to participate in the process of becoming the correspondents.

Furthermore, Revankar rules out the possibility of any conflict of interest due to the same.

10:25am Parsvnath Developers in news
Realty firm Parsvnath Developers said it plans to either sell the Rs 1,000-crore worth land parcels in South-West India or form joint ventures with local builders for development.

"We are planning to monetise our land parcels in southern and western part of the country in cities like Chennai, Hyderabad, Kochi, Goa, Mysore and Palghat. We will sell these plots if we get a good price or form joint ventures with local developers," Parsvnath Developers Chairman Pradeep Jain said, reports PTI.

10:10am Market Expert
Sanju Verma of Violet Arc Global Managers does not expect a pre-Budget rally, but feels Nifty will rally to 8000 post Budget. She feels the rally so far has been more aspirational than anything else.

According to her the Narendra Modi government is getting crushed under the weight of expectations.

10:00am The market continued to consolidate in morning trade. The Sensex rose 24.64 points to 25393.54 and the Nifty advanced 6.30 points to 7586.50 but the broader markets outperformed benchmarks.

The BSE Midcap and Smallcap indices gained 0.7 percent and 0.5 percent, respectively. Advancing shares outnumbered declining ones by a ratio of 1226 to 689 on the BSE.

Bajaj Auto, Coal India, NTPC, GAIL, BHEL and HCL Technologies topped the buying list, rising 1-2 percent. However, Bharti Airtel, ITC, ICICI Bank, Axis Bank, Cipla and DLF fell 0.5-2 percent on profit-taking.

SKS Microfinance, Muthoot Finance, Manappuram Finance and Magma Fincorp gained 1-3 percent after the Reserve Bank of India permitted non-banking finance companies to act as business correspondents (BCs) of banks. The central bank allowed NBFCs to offer limited services with the aim of spreading financial inclusion.

9:50 am Buzzing: Investors continued to buy shares of non-banking finance companies after the Reserve Bank of India permitted NBFCs to act as business correspondents (BCs) of banks. SKS Microfinance, Muthoot Finance, Manappuram Finance and Magma Fincorp shot up as much as 4-8 percent in early trade.

The central bank allowed these companies to offer limited services with the aim of spreading financial inclusion.

So far, NBFCs could not be appointed as BCs, which provide limited services on behalf of banks in unbanked areas. The RBI said there should be a contractual arrangement between a bank and an NBFC-ND to ensure that possible conflicts of interest are taken care of.

Banks must ensure the NBFC-ND does not adopt restrictive practices such as offering savings or remittance functions only to its own customers or bundling of their services, the RBI said in a notification.

9:40 am Delisting Suspecting violation of norms to check fraudulent and unfair trades, Sebi today ordered close monitoring of a proposed delisting of Indian unit of global pharma giant AstraZeneca . The capital markets regulator also said there appeared to have been a coordinated and concerted attempt by the Swedish promoters of AstraZeneca Pharma India and a Hong Kong-based fund house Elliott Group during a previous Offer for Sale of the company's shares.

9:30 am Market outlook: Independent analyst Anand Tandon says the market has already rallied quite a bit and in spite of the Nifty being in a range, midcaps continue to move up. "I would be very surprised to see a substantial rally from here for the next week or so. That said, the markets are likely to - at least the frontline stocks - remain in the plus/minus 2-3 percent range."   

The market opened on a flat note after the big rally seen on Tuesday. The Sensex is up 16.03 points at 25384.93 and the Nifty is up 1.95 points at 7582.15. About 671 shares have advanced, 218 shares declined, and 28 shares are unchanged.

GAIL, ONGC, BHEL, HDFC and Infosys are top gainers while Bharti, HUL, ICICI Bank and ITC are major laggards in the Sensex.

The rupee declined in the early trade. It has opened lower by 10 paise at 60.23 per dollar versus 60.13 Tuesday.The euro is steady against the dollar, meanwhile the dollar index is stuck in a range.

Pramit Brahmbhatt of Veracity said that, "Indian markets are expected to extend their gains taking cues from the better than expected economic data which helped investors regain their confidence, although at higher levels we may see some profit booking.Taking cues from positive equities, rupee is expected to gain. Range for the rupee seen between 59.80-60.60/dollar."

International markets, meanwhile, ended weak as tensions in Iraq overshadowed better-than-expected US economic data. The Dow slipped 120 points with the CBOE VIX seeing a sharp 10 percent rise. European markets were also subdued as German business confidence slipped. Asian markets are currently trading soft.

In other asset classes, Brent Crude rose back above USD 114 per barrel, as violence in Iraq took centre-stage again. Report of Syrian strikes in western Iraq add to geopolitical worries.