The Indian markets made a good bounce back in last session with benchmark indices gaining over half a percent despite a lower start. Some good earnings number along with the jubilation in capital goods stocks supported the markets. Today, the feeble global cues are indicating a gap-down start of the local markets and the indices may lose more than what they have gathered in the last session. The battered airline stocks are likely to get some respite as the PSU oil companies have marginally cut the jet fuel prices by Rs. 273 per kilolitre, the third straight reduction in rates since April. In stock specific actions Bharti Airtel may continue to remain under pressure on report that the Enforcement Directorate was investigating the company under provisions of the Prevention of Money Laundering Act and the Foreign Exchange Management Act. Also result reaction can be seen on Kishore Biyani-owned Pantaloon Retail India, which has reported a 76.2% drop in net profit to Rs 12.03 crore in third quarter ended March in the core retail business. While, the real estate major Unitech has reported a sharp drop in standalone net profit for the year ended March 31, 2012 to Rs 327.11 crore against Rs 510.08 crore in last year, down by 36%.
There will be lots of important result announcement to keep the markets buzzing, Bajaj Finserv, 3I Infotech, Blue Star, Dish TV India, Edelweiss Capital and Zee News are the important ones to announce their numbers today.
The US markets made another closing in red with European concerns outweighing the good domestic economic reports. Though, the retail sales grew less than expected but Commerce department’s report indicated underlying strength in demand in the country also the manufacturing activity in New York State surged. The Asian markets have made a sluggish start with most of the indices showing deep cut in the early morning trade. News that talks to form a new Greek government failed and the country is likely to hold new elections was weighing down the sentiments. The report that Japan’s machinery orders fell 2.8 percent in March, too has taken the indices lower.
Back home, the relief rally finally came through on Tuesday as market participants hunted for oversold but fundamentally strong bargains amid encouraging tidings from both domestic as well as global front. The bounce back came after five successive sessions of downtrend in which the BSE’s Sensex suffered a loss of around seven hundred points, while the NSE’s nifty suffered laceration of over two hundred points. The frontline equity indices found firm support around the important psychological 4,900 (Nifty) and 16,150 (Sensex) levels as they ricocheted from those levels. The key gauges which showed side-ways movement since the start of trade and see-sawed around the previous closing levels, came out of their range bound trajectory and trended northwards led by gains in Capital Goods and Metal counters. Though, the markets remained in a subdued mood for most part of morning trades tracking the apathetic cues from Asian peers as exacerbating concerns over the political and economic stability of the European region dampened investors’ appetite for riskier assets like equities. Investors were cautious after talks to form a new government in Greece failed and stoked fears that the debt laden nation would exit from the single currency union. However, sentiments got a lift after the vulnerable rupee strengthened sharply from a near record low against the dollar as Reserve Bank of India stepped in with massive intervention, signaling intent to defend the beleaguered domestic currency. The rupee appreciated to 53.8 to the dollar, hitting intraday low of 54.15 after RBI reportedly sold $400- $500 million worth in spot and forward markets. The Capital Goods counter rallied sharply with over three percent gains largely because of bellwether L&T which spurted over five percent on the back of solid fourth quarter performance. The Metal and IT pockets too amassed significant gains and supported the frontline indices. Meanwhile, fertilizers shares shot up sharply in the session after report claimed that Fertilizer Ministry has approved hike of 10% in urea prices. However, mild selling pressure was seen in defensive FMCG pocket which ended with just over half a percent cut, there appeared absolutely no evidence of selling pressure on BSE sectoral space but some individual heavyweights like NTPC and Maruti plunged over two and half a percent in the session. Finally, the BSE Sensex gained 112.41 points or 0.69% to settle at 16,328.25, while the S&P CNX Nifty rose by 35.00 points or 0.71% to close at 4,942.80.
