Late hour selling drags the market lower for the day as well as week

Trade continued to remain choppy for the Indian markets on Friday and major bourses despite following a tight range kept moving in and out of the red throughout the day and finally closing lower. Earlier the start was in green despite mixed global cues but benchmark indices soon turned lower lacking any major supportive factor. Traders even overlooked a HSBC survey, stating that manufacturing and services sectors in India expanded at a faster pace than China in November, even as emerging market output slipped for the second consecutive month to a six-month low. According to the survey, the four largest emerging economies showed contrasting activity trends in November. China registered growth for the seventh month running, while India posted the fastest growth since June, on the same time Russia and Brazil witnessed sharp decline.

The global cues were not very supportive and after a modestly lower closing of the US markets, the Asian markets too remained cautious ahead of a monthly US jobs report. However, European markets surged on Friday, erasing a weekly decline. European Central Bank (ECB) President Mario Draghi following the bank's decision to keep interest rates unchanged at record lows had said the region’s central bank will reassess stimulus next quarter. Traders were speculating that the European Central Bank will consider quantitative easing at its January meeting. However, Draghi’s comments damped speculation the central bank was poised to start a program of sovereign-debt purchases.

Back home, markets remained in consolidation mood and lost some ground on the last trading session of the week. Profit booking appeared ahead of the weekend. Broader indices once again looked in comparatively better position than the benchmarks. Selling intensified in the last leg of the trade dragging the markets lower by about half a percent for the day. Sectoral indices made a mixed closing, however the biggest laggards that dragged the markets lower were healthcare along with IT and tech stocks, down by over a percent each, after the rupee strengthened against the dollar. The PSU sector too lost its steam despite the government starting its Rs 58,000-crore disinvestment programme for 2014-15 with dilution of a 5% stake in Steel Authority of India (SAIL). The Centre plans to divest its holdings in over half a dozen firms this fiscal including a 5 per cent stake sale in ONGC, 10 per cent in Coal India, 11.36 per cent in NHPC and also in RINL and Hindustan Aeronautics. In non sectoral gauge some of the fertilizer stocks pared their gains on report that government is considering harsh measures to curb fertiliser subsidy and has made mandatory for the fertiliser companies to submit along with their subsidy claims, the cost data of their fertiliser products from 2012-13 onwards in prescribed format on six monthly basis.

Finally, the BSE Sensex dropped 104.72 points or 0.37%, to 28458.10, while the CNX Nifty declined by 26.10 points or 0.30% to 8,538.30.

The BSE Sensex touched a high and a low of 28651.75 and 28409.05, respectively. The BSE Mid cap index was down by 0.26%, while the Small cap index was up by 0.03%.

The top gainers on the Sensex were ITC up by 2.27%, Mahindra & Mahindra up by 2.24%, Sesa Sterlite up by 1.90%, HDFC up by 0.27% and HDFC Bank up by 0.23%. On the flip side, Dr. Reddys Lab down by 2.23%, TCS down by 2.21%, Sun Pharma down by 2.20%, Wipro down by 2.19% and Cipla down by 1.75% were the top losers.

On the BSE Sectoral front Realty up by 1.26%, FMCG up by 1.13%, Consumer Durables up by 0.28% and Metal up by 0.06% were the only gainers, while IT down by 1.83%, TECK down by 1.47%, Healthcare down by 1.40%, Oil & Gas down by 0.66% and PSU down by 0.56% were the top losers in the space.

Meanwhile, with an aim to enhance the domestic coal production, Coal Ministry has planned to launch soon an electronic platform to address all regulatory hurdles related to coal mines. Coal Secretary Anil Swarup has asserted that the platform will help Coal India to enhance the country's coal production to about 1.4 billion tonnes over the next five years.

Anil Swarup further added that the government is presently considering various issues that would come in the way of ramping up the production both in terms of environment clearance and land acquisition. Coal Secretary also expressed hope that three prominent rail lines proposed to directly connect with coal mines in states such as Jharkhand, Odisha and Chhattisgarh would be completed by December 2017.

In other encouraging development, Coal Ministry might put 18 more blocks on offer, in addition to the 74 already planned, in the upcoming auction of the mines. The government plans to conclude the first phase of allocation of coal blocks through allotment and auction by March 16, 2015. Of the total 92 blocks, some coal blocks will be allotted to state-run companies while others will be auctioned electronically for private players.

Indian domestic coal demand is around 35 percent higher than domestic supply. Coal India (CIL) is the only producer of coal in the country and is struggling to meet domestic coal requirements. CIL production fell 4.21 percent short of its production target to 462.53 million tonnes in FY14 amid concerns like shutdown of mining activities in Talcher Coalfields in Odisha.

The CNX Nifty touched a high and low of 8,588.35 and 8,523.90 respectively.

The top gainers on Nifty were DLF up by 5.34%, Ambuja Cements up by 3.02%, Mahindra & Mahindra up by 2.36%, PNB up by 2.11% and ITC up by 1.89%. On the flip side, Dr. Reddy's Laboratories down by 2.44%, Tech Mahindra down by 2.42%, TCS down by 2.39%, BPCL down by 2.33% and Wipro down by 2.29% were the top losers.

European markets were trading in green, France’s CAC 40 was up by 1.20%, Germany’s DAX was up by 1.22% and United Kingdom’s FTSE 100 was up by 0.58%.

Almost all the Asian equity benchmarks barring Taiwan Weighted, ended higher on Friday, as expectations of more stimulus from central banks in Japan and China helped cushion the disappointment over the lack of clarity from European Central Bank Mario Draghi on deploying additional monetary stimulus to mitigate deflation risks. Chinese shares ended an extremely volatile session sharply higher, led by gains in financials. Japanese stocks too strengthened, as a weaker yen boosted exporter shares. The dollar rose above the 120-yen mark for the first time in seven-and-a-half years amid fresh signs of resilience in the world's largest economy.