Benchmarks snap six sessions uptrend amid subdued global cues

Snapping their six sessions gaining streak, Indian frontline indices ended in negative terrain as participants preferred to book some profit off the table amid subdued global cues. The domestic bourses made a gap-down start as investors moved to price-in the implications of President Barack Obama’s re-election in terms of the ‘fiscal cliff’ of tax hikes and spending cuts that will take place in January if no action is taken. However, barometer gauges pared substantial losses during the trade supported by positive opening in European markets. The psychological 18,800 (Sensex) and 5,700 (Nifty) bastions proved as strong support levels as the key indices despite repeated attempts refused to go below those levels.

Feeble global cues too dampened the sentiments as US markets went through a sharp post election sell-off overnight and Dow slipped below the 13,000 mark for the first time since early August. There was concern among the investors after Fitch warning that if Obama don’t move quickly to avoid the fiscal cliff, it could lead to downgrade in 2013. While, all the Asian equity indices shut shop in the red as investors worried about the fiscal crisis in the United States. However, European markets traded firm in the early deals, buoyed by corporate earnings news and the safe passage of a key Greek austerity bill.

Back home, selling in software pack also hammered investors’ confidence as Stocks like Infosys and HCL Tech declined due to Obama’s anti-outsourcing stance, which has been an electoral winner for him. Market bellwether Reliance Industries (RIL), with second-highest weightage on Sensex fell nearly half a percent also led to the index downfall. The central information commission (CIC), the apex body under the Right to Information (RTI) Act, 2005 has directed the Securities and Exchange Board of India (SEBI) to share the details of several entities that were involved in the Reliance Petroleum Insider trading case in 2007. The commission also directed the market regulator to give the details of file noting on the consent order.

However, the losses remain capped after telecom stock such as Bharti Airtel, Idea Cellular and Reliance Communications edged higher in a weak market after the Cabinet approved one-time spectrum charges on all mobile phone companies, a move that will give the exchequer a minimum of Rs 30,927 crore. Rally in public sector oil marketing companies also limited the losses as stocks of HPCL and IOC surged 0.50-2.50 percent rose as crude oil prices dropped sharply on November 7, 2012. Some amount of support also came in after interest rate sensitive auto stocks rose on expectation of rate cut from the central bank in the first quarter of 2013. Also, realty sector gained over two percent on hopes for a pickup in demand tied to the Diwali festival season in mid-November, a time considered auspicious in the country.

The NSE’s 50-share broadly followed index Nifty declined by over twenty points to end below its psychological 5,750 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex dropped over fifty five points to finish below the psychological 18,900 mark. Moreover, broader markets too struggled to get some traction during the session and end on mixed note. The market breadth remained in favor of declines as there were 1,366 shares on the gaining side against 1,462 shares on the losing side while 133 shares remain unchanged.

Finally, the BSE Sensex lost 56.15 points or 0.30% to settle at 18,846.26, while the S&P CNX Nifty declined by 21.35 points or 0.37% to end at 5,738.75.

The BSE Sensex touched a high and a low of 18,865.21 and 18,736.45, respectively. The BSE Mid-cap index was up by 0.13% and Small-cap index was down by 0.21%.

Tata Motors up 5.52%, Wipro up 1.97%, Bharti Airtel up 1.90%, SBI up 1.32% and Tata Steel up 0.42% were the major gainers on the Sensex. On the flip side, Tata Power down 2.12%, L&T down 2.04%, GAIL India down 1.98%, ICICI Bank down 1.48% and Dr Reddys down 1.35% were the major losers on the index.

The top gainers on the BSE sectoral space were, Realty up 2.03%, Auto up 1.01%, FMCG up 0.20%, Consumer Durables (CD) up 0.15% and TECk up 0.10%, while Capital Goods (CG) down 1.35%, Health Care (HC) down 0.70%, Power down 0.68%, Oil & Gas down 0.50% and Bankex down 0.37% were major losers on the BSE sectoral space.

Meanwhile, with the recent policy initiatives in FDI in multi brand retail, Union Minister for Commerce, Industry and Textiles, Anand Sharma has affirmed that the arrival of brands like Zara, Louis Vuitton, Gucci, Jimmy Choo might bring more flavours to the Indian apparel market, which would provide plenty of job opportunities for the young designers along with the better choice of products.

While speaking in the Convocation of the National Institute of Fashion Technology (NIFT) at Rae Bareli, he urged the young designers to enrich the traditional Indian textiles, while working in close contact with the traditional artisans. He also pointed that the indigenous carpet designs are likely to reach global markets soon with the foreign intervention.

According to reports, the Swedish furniture maker IKEA has partnered with India's Handicrafts Department for design development and capacity building of Indian handicraftsmen and carpet weavers. With this initiative, nearly 200 exporters would be trained to ensure that they follow the international best practices related to labour laws that prohibit child labour. IKEA has promised to invest about 1.5 billion euro (Rs 10,500 crore) in India to set up 25 stores.

The S&P CNX Nifty touched a high and a low of 5,744.50 and 5,693.95 respectively.

The top gainers on the Nifty were Tata Motors up 5.51%, Bharti Airtel up 2.10%, Wipro up 1.83%, Asian Paint up 1.32% and SBI up 1.26%.

The top losers on the index were L&T down 1.97%, GAIL down 1.91%, IDFC down 1.86%, Reliance Infra down 1.74% and Tata Power down 1.64%.

European markets were trading in green. France’s CAC 40 up 0.49%, Germany’s DAX up 0.49% and Britain’s FTSE 100 up by 0.27%.

Asian markets tumbled on Thursday as concerns as the U.S. fiscal cliff made investors nervous merely a day after the U.S. presidential election results. Japan’s Nikkei closed in negative territory with the stronger yen pressuring Japanese exporters. Chinese markets went home with red mark ahead of announcement of the next generation of leaders later today. Meanwhile, market sentiments were pressured after the European Union slashed its economic forecast.