Sensex slips as weak macro data dampens mood; Titan dn 3%

Benchmark indices ended lower in volatile trade Tuesday, as a steady stream of weak macro-economic data kept buyers on the back foot.

A 50-month low reading of HSBC Manufacturing Purchasing Managers' index for May is the latest indicator that a recovery in the economy is still some way off.

The 30-share Sensex closed at 19545.78, down 65 points over the previous close, after touching a high of 19742.70 intra-day. The 50-share Nifty slipped 20 points to close at 5919.45.

Pharma, capital goods, power and FMCG shares were in demand, while those from the banking, realty and auto sectors underperformed as hopes of a rate cut has dimmed after last week's remarks on inflation by the RBI governor.

Bata India , Glaxosmithkline Consumer, Cadila Healthcare , Apollo Hospitals and Ranbaxy Lab were the big gainers, gaining 4-7 percent.

Among laggards, JP Infratech, Dish TV , Mphasis , Adani Power and Titan were the laggards, falling 3-5 percent.

With the quarterly earnings season past and speculation about a possible unwinding of monetary stimulus in the US, the mood has turned jittery. Not helping matters is the renewed weakness in the rupee and political uncertainty.

"You could see a sell off which is slightly more than what one would expect as part of a normal correction," said Nilesh Shah of Envision Capital in an interview to CNBC-TV18 earlier today.

"From the current levels, the markets could correct by another 5-10 percent which means that the market could revisit the lows that it made sometime in March-April,'' Shah said.

Morgan Stanley is bullish on India, and ranks it alongside the key Asian markets that will gain around 15 percent this year.

"What is interesting here is though the growth environment is not that great the inflation trends are pretty good. So WPI inflation falling below 6 percent tends to be good for the multiple and we have somewhat better situation on the fiscal and current account balance," said Jonathan Garner, Chief Asian & EM Equity Strategist, Morgan Stanley.

3:55 pm Update: Foreign institutional investors (FIIs) have sold Rs 2900 crore  worth of index futures in the last two trading sessions, indicating they are bracing for lower levels in cash shares in the near term, dealers say, reports Reuters.

Dealers say that raises some concerns after FIIs were net sellers of Rs 86 crore  of stocks on Monday and about Rs 500 crore on Friday, exchange and regulatory data showed.

3:50 pm Alert: Idea denies reports of talks with Axiata for tower asset sale. The telecom operator says that reports of Idea selling tower assets are speculation, reports Cogencies. Axiata holds nearly 20% stake in Idea Cellular. The stock closed at Rs 135.15, up Rs 5.15, or 3.96 percent on the BSE.

3:40 pm Index gainer: BSE Healthcare index (up 1.8 percent) is the major gainer. Ranbaxy soars 4.5 percent.

3:30 pm Market update: The market closes in red territory. The Sensex ends the day at 19552.49 down 57.99 points while the Nifty slips 16.85 points to close at 5922.45 (provisional). Tata Motors (down 2.34 percent) and SBI (down 2.11 percent) are the top losers in the Sensex. Dr Reddy's Labs, Cipla , Wipro, L&T and M&M are key gainers.

3:15 pm RBI norms: RBI has tightened norms for gold import by nominated agencies. The central bank has said that all letters of credit for gold import will be made only against 100 percent cash. "All gold imports must be on  'docu against payment' basis,"  it adds. Most of the jewellery stocks are falling with Titan Industries down 2.2 percent, Tara Jewels down 1.2 percent, Vaibhav Global down 1.6 percent, Shree Ganesh Jewellery House down 1.5 percent.

Find out: 3 banks, 2 NBFCs that Darashaw is betting on

The market is still under pressure in the last hour of trading pulled down by financials stocks. The Sensex has slipped down 73.63 points to 19536.85, and the Nifty is down 23.05 to 5916.25. About 1046 shares have advanced, 1175 shares declined, and 177 shares are unchanged.

Financial stocks are growing weak with SBI losing 1.9 percent, HDFC down 1.4 percent. Other major losers in the Sensex include Tata Motors, Jindal Steel and Maruti Suzuki.

Pharma stocks are still on buyers' radar. Dr Reddy's Lab and Cipla are top Sensex gainers.

02:59pm Larsen & Toubro shares bucks the trend amid weak market, rising 1.65 percent. Dr Reddys Labs and Cipla too outperformed the market with 2 percent gains.

Utility vehicle maker M&M and power producer NTPC gained one percent each.

In the midcap space, Linde India topped the buying list, rising more than 7  percent.

02:55pm Market update - The BSE Sensex extended losses to 78 points on fall in Reliance Industries and ICICI Bank. The Index is quoting at 19532.59. The Nifty is down 25.35 points at 5913.95.

Top lender State Bank of India plunged 2 percent while Reliance Industries fell 0.8 percent. Even ICICI Bank slipped 0.2 percent after erasing all gains.

02:50pm Axis Bank shares fell more than 2 percent while State Bank of India slipped over 1 percent. Housing finance company HDFC declined 1.5 percent.

Tata Motors DVR issued 15.9 lakh ADS and 87.8 lakh equity shares on FCCB conversion.

02:45pm European markets lost half of early gains; France's CAC trimmed gains to 0.4 percent from one percent while Germany's DAX cut gains to 0.35 percent from one percent.

Also Read - Exit Japan, rest of Asia can rally 15%: Morgan Stanley

02:40pm Market update - Indian equities erased all gains amid choppy trade, weighed down by HDFC, HDFC Bank and State Bank of India. Even ICICI Bank trimmed gains to 0.7 percent from 1.2 percent.

The BSE Sensex is down 24.87 points to 19,585.61, and the Nifty is down 6.65 points at 5932.65. But midcaps and smallcaps continued to outperform benchmarks.

India is likely to relax KYC (know your customer) norms for FIIs by June-end and likely to raise FII  limit in government debt by USD 5 billion, Reuters said, quoting finance ministry sources.

02:30pm ICRA shares dropped nearly 5 percent on profit taking. Traded volumes jumped quite significantly after a block deal.

49,000 equity shares changed hands at Rs 1,040 a piece in afternoon while its five-day average of traded volumes is around 4,100 shares.

02:25pm Karnataka Bank is the lead gainer in midcap space, rising 6.65 percent followed by Aurobindo Pharma, PTC India and KPIT Cummins with 4-4.5 percent gains.

JSW Ispat Steel rose more than 4 percent after three block deals on National Stock Exchange. More than 16 lakh equity shares exchanged hands at average price of Rs 9.55 a piece.

02:15pm Equity benchmarks are trading with marginal gains, supported by ICICI Bank, Reliance Industries and Larsen & Toubro. Cipla and Dr Reddy's Labs surged 2-3 percent.

Ranbaxy Labs extended gains to 4.5 percent whereas Sun Pharma lost morning gains.

The BSE Sensex is up 52.69 points at 19663.17, and the Nifty is up 17.50 points or 0.29% at 5956.80.

1: 52 pm Gainers: Cipla , M&M, Wipro , Dr Reddys Labs and L&T are major gainers in the Sensex.

1:50 pm Index check: Capital goods and pharma stocks are gaining while metals, technology and consumer durable stocks are growing weak.

1:45 pm Macro outlook: Taimur Baig, economist (India), Deutsche Bank is worried about the domestic outlook and believes growth in the first half of the new fiscal will remain stagnant at 5 percent. He, however, expects productivity to pick up in the second half and FY14 may close with a 6 percent GDP growth.

Baig expects the Reserve Bank of India (RBI) to cut rates succumbing to the reality of weak data and declining inflation. "We have rather aggressive calls on the rate side. We not only expect RBI to cut in the mid June meeting but also in July as well as in September. So we are looking at another 75 bps rate cut not because of anything the central bank has said, but from the real data flow it will be compelled to keep on cutting," he says in an interview to CNBC-TV18.

1:40 pm FII view: Stock market prices will continue to rise for the next two years until the wealth gap between Wall Street and Main Street gets too high and reality sets in, economist Nouriel Roubini told CNBC .

Worry about the Federal Reserve backing off its historically unprecedented monetary easing is premature, Roubini said, as economic growth is too tenuous and the market too dependent on the USD 85 billion in monthly asset purchases from the central bank.

1:37 pm Market update: The Sensex is up 71.62 points at 19682.10, and the Nifty is up 25.35 points at 5964.65.

1:20 pm Update: Hindalco may raise Rs 5000 crore to refinance debt. It will finalise bankers to raise capital. SBI may be appointed lead banker for fund raising, reports CNBC-TV18 quoting sources.

1:19 pm Bond alert: RBI says new 10-year inflation-indexed bond tender is fully subscribed.

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1:18pm News update: Dubai based company has selected Wipro as a strategic partner for five years. The stock is currently at Rs 331.00, up Rs 5.35, or 1.64 percent on the BSE.

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The market is going through a choppy trading session, unable to find a direction. The Nifty is hovering around 5950 and is currently up 15.55 points to be at 5954.85. The Sensex is up 47.55 points at 19658.03.

ICICI, L&T, M&M, Dr Reddys and Cipla are lead gainers in the Sensex. Bata India is up 5.2 percent as agency reports indicate that its board will consider bonus share issue, share split in FY14. Bata India says that it has initiated steps to merge subsidiaries with company.

Meanwhile, Jindal Steel, Coal India , Sterlite Industries, Maruti Suzuki and HDFC are top losers in the Sensex.

12:59pm Software services provider Wipro gained one percent, after it has picked up a minority stake in US-based cloud computing firm Axeda Corp for USD 5 million.

Lanco Infratech surged more than 5 percent, after the company bagged orders worth Rs 3,294 crore from Gujarat Industries Power Company for its thermal power project.

12:55pm The dollar index continued to trade below 83 and Brent crude held the USD 101 a barrel level.

The government is considering curbing gold imports by canalising agencies, reports CNBC-TV18 quoting cogencis. It is learnt that the government is also considering curbs on purchase of gold jewellery in cash.

12:50pm Equity benchmarks are consolidating since early trade, after more than 600 points fall seen in previous two sessions, despite European markets opened in a positive terrain.

Index heavyweight HDFC slipped again, losing 0.7 percent while TCS and Infosys remained in bear grip.

12:40pm Indian stocks gained strength again, after positive opening of European markets. The Sensex is up 107.95 points or 0.55 percent at 19718.43, and the Nifty is up 35 points or 0.59 percent at 5974.30.

France's CAC and Germany's DAX rose more than one percent while Britain's FTSE advanced 0.7 percent.

Also Read - `Mkt may fall 5-10%, new bank licence to ace runners only'

12:35pm Rating agency CRISIL hit a fresh record high of Rs 1,161.40 Tuesday, continuing its previous session's rally. The stock had locked at 20 percent upper circuit yesterday, after McGraw Hill Financial Inc (parent company of S&P) offered to hike its stake in the domestic ratings agency to 75 percent from 52.77 percent.

S&P India LLC and Standard & Poors International LLC  hold 44.44 percent and 8.54 percent, respectively as of March 2013.

12:25pm Kirloskar Industries shares rose 3.5 percent, after 1.65 lakh equity shares changed hands at Rs 310 a piece via block deal on Bombay Stock Exchange.

Ranbaxy Labs topped the buying list among Nifty 50 stocks, rising 3.5 percent followed by Cipla with nearly 3 percent gains.

12:15pm Glenmark Pharma rallied nearly 3 percent amid large volumes, after five block deals worth Rs 131.1 crore. The stock also touched a new 52-week high of Rs 610.

More than 21.8 lakh equity shares changed hands at Rs 600 a piece on National Stock Exchange via five block deals.

12:10pm Idea Cellular increased pre-paid 3G roam data rate from 7 paise to 10 paise per 10kb in Kerala and also tweaked Kerala 2G pre-paid local & national roam data rate, reports CNBC-TV18 quoting cogencis.

12:00pm Indian equities continued to trade higher amid volatility in afternoon trade, helped by oil & gas, healthcare and banks.

The BSE Sensex is up 106.15 points or 0.54 percent at 19716.63, and the Nifty is up 34.95 points or 0.59 percent at 5974.25.

Nischint Chawathe, analyst at Kotak Institutional Equities says the RBI's latest clarification on the bank new licences is a negative for existing large non-banking financial companies (NBFCs).

In the clarification on draft norms issued on Monday, the banking regulator made it clear that track record of all group companies, including non-financial ones, would be considered while vetting the applications.

Shriram Transport Finance Corporation declined 0.9 percent. Aditya Birla Money and L&T Finance Holdings, which experts say are strong contenders for banking license, gained 4-4.5 percent.

11:50 am Deal: Private equity firm ChrysCapital has invested about USD 44.01 million in consumer products maker CavinKare, the companies said in a statement late on Monday. The investment will be used to strengthen and expand the brand portfolio of the south India-based consumer products company, CavinKare said, without disclosing further terms of the transaction.

11.42 am Market update: The Sensex is up 90.54 points at 19701.02, and the Nifty gains 30.15 points to be at 5969.45.

11:30 am Alert: OnMobile Global is in agreement to buy US-based Livewire Mobile for USD 17.8 million.

11:27 am Views: Amid the lengthy clarifications issued by the central bank on new bank licences, Reserve Bank Deputy Governor K C Chakrabarty on Tuesday said customer service in the banking industry will be better if more banks come in as it will drive competition, reports PTI.

11:20 am Alert: Telecommunications carrier Bharti Airtel has submitted its final bid for a telecoms licence in Myanmar, a company spokesman told Reuters on Tuesday. The stock is up 0.9 percent on the BSE.

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Expert take: Since the market has begun taking risks, it is going to become increasingly volatile going forward , says Nilesh Shah, MD & CEO, Envision Capital. It may go on to correct 5-10 percent although select largecaps and top quality names will see continuous flow of liquidity.

Shah continues to suggest private banks to investors and traders on account of their ability to guard net interest margins and asset quality; the latter remains a concern with public sector banks.

On aspirants of new banking licence, he said the Reserve Bank of India (RBI) will be selective in handing out one and it will be challenging for the new banks to witness sustainable returns for at least three-five years.

The Nifty has shed some early gains, but manages to hold the 5950 level on support from oil & gas, healthcare and infrastructure stocks. The Index rose 19.60 points to 5958.90 and Sensex gained 53.79 points at 19664.27.

However, technology stocks are dragging with Infosys and TCS losing around 1 percent each. Tata Consultancy Services , the country's largest software company, may sack as many as 290 employees at its Finland office; a move that the workers say is an attempt to shift jobs to India, reports PTI.

TCS, which has a registered office in Helsinki and has employee strength of about 800 in Finland, is currently in negotiations with the employee representatives (ERs) over the move to cut jobs.

In commodities, brent crude rallied to USD 102 on weak dollar. Gold also jumped to USD 1410 an ounce.

In currencies, there is massive strength in yen, which has now gone back below 100. Dollar index has weakened further to 82.7 and euro stands at 1.307

Bonds are going higher on account of an unexpected announcement of open market operations (OMO) or bond purchases by the RBI. The market will now wait for the trade deficit numbers, industrial output and inflation data.

10:59am VK Sharma, Head Private Broking & Wealth Management, HDFC Securities is of the opinion that if 5,875 level on the Nifty breaks and then it could go to the level of 5,500. In that case Puts which have been written at 5900 will reverse.

Asian markets are trading lower barring Nikkei. Shanghai Composite fell more than one percent. Hang Seng, Straits Times, Kospi and Taiwan are flat to negative whereas Nikkei gained nearly 2 percent.

10:55am Benchmarks erased some early gains, weighed down by Infosys and TCS that extended fall to nearly one percent.

The Sensex is up 63.70 points at 19674.18, and the Nifty up 22.10 points at 5961.40.

Shares of ITC, HDFC Bank and Tata Motors too turned negative, losing about 0.2 percent.

10:40am Non-banking finance companies are in focus, after the Reserve Bank of India came out with further clarifications on new banking licenses Monday.

Shriram group told CNBC-TV18, "The RBI calrifications are reasonably clear, it is tough for NBFC's to comply with norms on reserve requirements and priority sector lending. We will take a couple of weeks to decide whether to apply for banking license or not and whether the board agrees to modify the structure for bank license application."

Also Read - Here's why Shriram group may stay away from banking biz

10:35am Bata rallied nearly 5 percent amid large volumes ahead of annual general meeting today. The company will declare a dividend of Rs 6 per share.

Brokerage house Motilal Oswal has initiated a buy coverage on the stock, with a price target of Rs 975. "We expect strong earnings growth and visibility and estimate Bata's revenues will increase by 17 percent and net profit by 22.5 percent over CY12-15e," Motilal Oswal said.

10:30am The BSE Sensex gained more than 100 points on short covering, after more than 600 points fall in previous two sessions.

The index is up 116.78 points or 0.60 percent at 19727.26, and the Nifty up 39.45 points or 0.66 percent at 5978.75.

Infosys shares trimmed early losses to 0.7 percent from nearly 2 percent. Its rival TCS too declined 0.7 percent.

Also Read - Consumer stocks may fall 20%; avoid PSU banks: Kotak

10:20am Suzlon Energy shares gained 1 percent after its German subsidiary REpower received contracts to supply 26 MW to ABO Wind in Burgundy, France.

IDFC rose 1.5 percent, after the clarifications on the banking guidelines. Brokerage house Kotak said IDFC is the best placed from their coverage universe to get a license given both management intent and eligibility. "Mobilising priority sector loans within 30-35 months will be a challenge for IDFC, but in the past the company has indicated its willingness to comply with SLR/CRR requirements," Kotak in a report said.

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10:10am Among midcaps, Tata Communications after successful offer for sale issue, Peninsula Land, DB Realty, Bata India and Aurobindo Pharma topped the buying list, rising 3-4 perecnt.

The Sensex is up 107.58 points or 0.55 percent at 19718.06, and the Nifty up 33.95 points or 0.57 percent at 5973.25.

Meanwhile, Educomp Solutions, ABG Shipyard, BGR Energy, Carborundum and SpiceJet are top midcap losers, falling 2-5 percent.

10:00am Indian equity benchmarks gained 0.5 percent in morning trade, recouping some of losses seen in previous session. Index heavyweights Reliance Industries , Larsen & Toubro and ICICI Bank helped the benchmark, rising 1-2 percent.

The BSE Sensex is up 97.48 points or 0.50 percent at 19707.96, and the Nifty up 31.75 points or 0.53 percent at 5971.05. More than two shares advanced for every share declining on the Bombay Stock Exchange.

Healthcare stocks like Dr Reddy's Labs, Cipla and Sun Pharma gained 0.6-2 percent while metals shares namely Tata Steel, Hindalco, Jindal Steel and Sterlite rose 0.6-1 percent.

Infosys shares fell one percent on profit taking, after it rallied more than 4 percent in previous session on Murthy joining the company as a executive chairman again.

Non-banking finance companies like L&T Finance Holdings (up 3.7 percent), Mahindra & Mahindra Financial Services (up 1.5 percent) and SREI Infra Finance (up 1.5 percent) and LIC Housing Finance (up 1.5 percent) are gainers.

9:55 am Alert Suzlon Energy: REpower wins contracts to supply 26 MW to ABO Wind in Burgundy, France.

9:50 am Midcap winners: Apollo Hospital , Aurobindo Pharma , Bata India , CRISIL , Glenmark , Indian Infotech, Tata Communication, Lanco Infratech are some midcap winners.

9:45 am Buzzing: Idea Cellular shares gained 1.5 percent in early trade  on media reports that the company is in talks to sell its tower business to Axiata. Media reports suggested that the Aditya Birla group-owned telecom operator is in discussions Axiata of Malaysia for selling its towers to the Malaysian company, but the deal could get stuck over valuation of assets.

9:40 am Indices check: Capital Goods, Oil & Gas, Healthcare, Realty index are lending support to the market while IT index is growing weak.

Here is what Sukhani says about the market: Nifty in for 5700; look for buying opportunities

9:35 am Buzzing: Lanco Infratech surges 7.1 percent to Rs 9.38 on the BSE as the company got orders worth Rs 3,294 crore for EPC work from GIPCL for 2 300 mega watt thermal power project.

9:29 am Market update: The market has managed to recover. The Sensex is up 116.27 points at 19726.75, and the Nifty is up 32.65 points at 5971.95.

9:20 am Experts take: India Inc's performance in the fourth quarter of fiscal year 2013 exceeded expectations with adjusted net profits of BSE-30 index increasing 8.2% year-on-year versus an anticipation of a 1.8% decline, says Sanjeev Prasad, Senior Executive Director & Co-Head at Kotak Institutional Equities .

Automobiles and metals and mining stocks were among the surprise performers in the January-March quarter, he told CNBC-TV18. He expects FY2014 net profits to grow 5.4 percent but says FY14 their EPS estimate is relatively unchanged.

Prasad notices that market participants are betting too much on recovery, which is unlikely to happen in next 12-18 months. He rules out macro recovery translating into GDP growth and expects FY14 current account deficit (CAD) to be around 4 percent.

The market opens on a quiet note. The Sensex is down 12.82 points at 19597.66, and the Nifty is up 1.80 points at 5941.10. About 184 shares have advanced, 89 shares declined, and 23 shares are unchanged.

Global cues are mixed. The US markets added to their gains in the final minutes of trading to close near session highs on Monday, with the Nasdaq reversing its losses and all key S&P sectors in positive territory. The CBOE volatility index traded above 16. Asian markets are trading mixed.

Stock specifically, Hero MotoCorp which was a major loser on Monday has recovered today, gaining 2.5 percent. Hindalco , Cipla , NTPC and Wipro are major gainers in the Sensex. Banks, Metals, Pharma, Oil & Gas, Capital Goods, Power index are up in early morning trade.

However, Infosys is seen to be quickly shedding all its gains. The stock has already lost 1.3 percent while HDFC , TCS , Bajaj Auto and Tata Motors are key losers in the Sensex.

Last evening, RBI allowed corporates 18 months to implement a bank license, up from 12 months earlier. It clarified no let up on minimum 51 percent public ownership of the bank; or on meeting priority sector and other rules.

Adani Ports will sell over 6 crore shares via IPP. They have set a price band at Rs 148-158 per share.

The rupee opened with a gain of 20 paise at 56.56 per dollar versus 56.76 yesterday.

NS Venkatesh, IDBI Bank said, "The rupee continues to trade with a weak bias. There is an expectation of further rise on curb in gold imports and a rate cut in the upcoming monetary policy due to lower inflation. All these factors could be rupee positive. The range for the day is seen between 56.30-56.85/USD."

The euro cooled off to 1.30 levels after rising to 1.31 to the dollar. The dollar index steadies after slipping as much as 1 percent to 82.42 levels.