Sensex, Nifty end in red; Bharti Airtel up 4% on SC relief

Key equity benchmarks ended a listless day of trade in the red. The BSE benchmark Sensex ended down 12.45 points at 18437.78, after touching an intraday low of 18,504.48. The NSE benchmark Nifty closed down 10.30 points at 5542.95.

Shares of Bharti Airtel ended up nearly 4 percent after the Supreme Court on Monday, allowed India's largest telecom operator, along with Vodafone and Idea Celluar, to maintain pacts until April 11 allowing them to offer 3G services outside their licensed zones.

The telecommunications ministry had asked Bharti Airtel, Vodafone and Idea Cellular to end the pacts, which the government says are illegal. It also imposed penalties on the companies. The court will hear the case again on April 11. The dispute over the 3G pacts is one of several regulatory challenges hurting carriers in the world's second-biggest mobile phone market.

TVS Motor ended up 9.93 percent on news of its tie-up with German automaker BMW AG's motorcycle division to jointly develop bikes that will give the Indian automaker access to BMW technology as it looks to stem its falling market share.

State-run Bharat Heavy Electricals Limited (BHEL) closed up 2.62 percent after the capital goods major beat street estimates by posting provisional net profit of Rs 6,485 crore in the fiscal ending March 31, 2013.

BSE consumer durables index up 1.2 percent, FMCG index up 0.8 percent, oil & gas gains 0.7 percent, while the IT index is down 0.9 percent.

Top losers on Sensex: Sterlite Ind (-1.85 percent), Larsen & Toubro (-1.78 percent), HDFC (-1.62 percent), Wipro (-1.39 percent) and Jindal Steel (-1.3 percent)

Key equity benchmarks continue to trade flat, amid talks of lower levels likely for the Sensex.

The index is expected to fall further towards 18,000 levels, according to technical indicators, says AK Prabhakar, senior vice president at brokerage AnandRathi.

The Sensex is currently trading at 18452.38, having recently hit its lowest intraday level since November 21, 2011.

Prabhakar notes the Sensex still has an unfulfilled gap between September 13 and September 14 last year. Filling it could push the Sensex down to 18,062, he notes.

Although there may be a bounce back in the very near term as markets are looking a bit oversold, the main trend remains down, Prabhakar says.

The Fibonacci levels also point to potential pressure. The Sensex is flirting with 18,400 points, which marks the 38.2 percent Fibonacci retracement from its 15,748 low on June 4, 2012 to the high of 20,203 on January 29.

A fall below 18,400 could open up the 50 Fibo retracement at 17,976 points. The Sensex fell below 18,400 points at one point on Friday but closed above that level.

At 14.32 hrs IST, the Sensex is up 13.07 points or 0.07% at 18463.30, and the Nifty down 2.70 points or 0.05% at 5550.55.

Top gainers on the Sensex: Bharti Airtel (2.99 percent), Cipla (2.42 percent), BHEL (2.14 percent), Tata Power (1.52 percent) and Dr Reddys Labs (1.45 percent)

Meanwhile, Jefferies says fundamentals for India's banking sector are unlikely to change much given "tepid" loan and deposit growth, "range-bound" net interest margins and "weak" asset quality.

"The reason to own/sell a stock then boils down to valuations," Jefferies says in a report titled "Initiating on India Banks: Going Nowhere" and dated April 5.

Jefferies starts HDFC Bank (up 0.67 percent), ICICI Bank (-0.76 percent) and Bank of Baroda (-1.33 percent) with "buy" ratings, but initiates State Bank of India with an "underperform" rating.

Shares of Bank of Baroda were down following a report by Firstpost.com alleging money laundering. The bank denied the charges and said it had been complying with know-your-client rules.

The market has perked up some bit in afternoon trade and the Nifty was hovering around 5550. The Nifty gained 1.85 points now at 5555.10, while the Sensex is up 11.71 points at 18461.94.

Commodities and technology stocks were under pressure even as pharma and oil and gas stocks surged. Midcaps too gained some ground.

State-run Bharat Heavy Electricals Limited (BHEL) buoyed up 2.5 percent in the Sensex. Beating street estimates it has posted provisional net profit of Rs 6485 crore in the year ending March 31, 2013. Its net sales grew to Rs 50,015 crore in FY13. BHEL has also achieved order inflow guidance for FY13.

Other lead gainers in the Sensex included Bharti Airtel, Dr Reddy's Labs, Cipla and Sun Pharma.

Meanwhile, Wipro, Sterlite, L&T, TCS and Infosys were laggards of the day.

The Nifty is trading below 5550-mark in afternoon trade. Technology and metal stocks are dragging the benchmark indices lower. Technical analyst Sudarshan Sukhani believes the market will remain choppy and trade in a narrow band for the rest of the day.

He advises to buy Reliance Communications for short term.

The Sensex is down 34 points at 18416 and the Nifty is down 9 points at 5544.

Meanwhile, Gujarat Chief Minister Narendra Modi is speaking at a FICCI meet.

Reliance Infra, Bharti Airtel, Ambuja Cements, Dr Reddys Labs and Cipla are top gainers on the Nifty. Ranbaxy Labs, Cairn India, ITC, HCL Tech and Sesa Goa are top losers.

In currencies, Yen is still trading at 4-1/2 year low versus the dollar. Euro has cooled off after hitting 1.304 on Friday while dollar index is trading at 82.7.

In commodities, Brent crude slumps to eight month low, trading below $105. Gold rallies 1.5 percent to $1580.

The rupee is trading higher in early trade in line with the euro. There is also news of some dollar flows from corporate but 54.60 is expected to remain a support for the dollar given strong purchases by oil companies.

Bonds are trading higher after the first auction of the new fiscal year saw good demand on Friday.

It has been a quite session for the market so far. The Nifty is consolidating around 5550 after losing 170 points last week. It is still trading well below its 200 Day Moving Average (DMA) of 5641.

The Sensex is up 3 points at 18453 and the Nifty down 1 point at 5552. The BSE Sensex is expected to fall further towards 18,000 levels, according to technical indicators, says AK Prabhakar, senior vice president at brokerage AnandRathi.

Tata Motors is up 1.4 percent after Jaguar Land Rover reported its highest UK sales at 17,773 units, up 20 percent year-on-year.

Bharti Airtel is up 2.2 percent ahead of a Supreme Court hearing on a petition by Chairman Sunil Mittal seeking to overturn a lower court order that asked him to appear before the court in a spectrum allocation corruption case.

Jindal Steel & Power is down 1.6 percent after the company said its holding company has pledged company shares with the Singapore unit of Credit Suisse. The steel company did not disclose the amount in its filing after market hours on Friday.

Foreign funds have sold shares worth Rs 897 crore in the previous three sessions, provisional exchange data showed, amid worries about the domestic economy, and on lingering concerns about political stability.

The National Green Tribunal will hear a case over the closure of Sterlite Industries copper smelter tomorrow.

After a sluggish start, the market remained flat in the morning hours of trade. The Sensex was up 3.99 points at 18454.22 while the Nifty gained 1.50 points to 5554.75.

Bajaj Auto, Cipla, Tata Motors, Bharti Airtel and M&M were the lead gainers in the Sensex. Investors were still buying sugar stocks after the government decided to decontrol sugar price last week. Balrampur Chini was up 2.3 percent while stocks like Shree Renuka, Bajaj Hindusthan gained around 1 percent.

Reliance Communication surged 4 percent on reports that the company will sell 80 percent stake in its subsidiary Reliance Globalcom to a consortium led by Batelco for around Rs 6000cr as part of a series of deals the group hopes to strike over the next 2-8 weeks.

TVS Motor (up 3.2 percent) was excited as in a press conference scheduled at 3 pm later today, the management is expected to finalise the alliance with BMW's motorcycle division , BMW Motorrad.

Mahanagar Telephone Nigam (MTNL) was up 2.6 percent as Kapil Sibal has sought the intervention of Prime Minister Manmohan Singh to chalk out a revival strategy for the loss-making state-run telecom operators BSNL and MTNL. He suggested a group of ministers be formed to look into the issue and said that unless the government takes immediate measures to revive the companies, they will turn sick very shortly.

Meanwhile, technology stocks looked weak ahead of the fourth quarter earnings. TCS and Wipro were the major losers of the day.

Benchmark indices were sluggish in early trade Monday, as the market braces for a lackluster or perhaps even nasty earnings season.

The Sensex was up 26 points at 18476 and the Nifty was up 7 points at 5560.

Key gainers included Pantaloon Retail, Reliance Communications, UCO Bank, Indian Bank, and Satyam Computer, up between 2-3 percent.

Main laggards were Indraprastha Gas, Jubilant Foodwork, Exide, Ranbaxy and Ipca Lab, down 1-2 percent.

Segmentwise, shares from the oil & gas, power and auto sectors were doing well.

Brokerage house Motilal Oswal estimates the 144 companies under its coverage, excluding oil marketing companies, to report zero growth in aggregate for the quarter ended March.

"This is the lowest growth in the last 28 quarters, excluding the four quarters of PAT de-growth during the global financial crisis (FY09/FY10)," says the brokerage in its earnings preview note.

IT shares were under pressure in early trade, even though the market is not expecting any negative surprise from the frontline companies in the sector.

Midcap and small shares were in demand, though players are divided on whether the bounce can sustain.

"The market appears to have priced in much of the negatives at current levels," says Kirti Doshi of Antique Stock Broking, adding that the market was quite close to its long term bottom.

Arvind Sanger, Managing Partner, Geosphere Capital Management, feels the market is preparing itself for a disappointing earnings season. He sees rupee depreciation as the key risk to the market, and estimates that foreign investors could lose as much as 10 percent because of a weak rupee alone.

He says investors have turned cautious on banks and expects the asset quality to worsen before it gets better.

Brokerage house First Global shares Sanger's gloomy outlook on the banking sector, and says that weak earnings from banks is the biggest risk to the stock market as the sector will contribute at least a half to the Nifty's earnings growth for FY13, and a third to the market's earnings growth for FY14.

"We see big banks disappointing significantly on earnings growth in FY14. A combination of the overall slowdown, and the recent money laundering episode, will put a brake on cheap deposit growth, and hence, on profit growth," says the First Global note to clients.