Markets consolidates ahead of the Christmas holiday

Monday’s session turned out to be a lackluster one for the Indian stock markets as the optimism that emerged in morning trade fizzled out completely by the end leading the benchmark equity indices to a flat closing just above the neutral line. Both the frontline indices gyrated in a tight range, throughout the day, keeping their head above water. Investors lacked conviction to open fresh positions and booked profits at higher levels ahead of the Christmas holiday and expiry of December derivative contracts on Thursday.

The frontline gauges had drifted around the psychological 19,300 (Sensex) and 5,850 (Nifty) levels in morning trades following buying in key heavyweights along with broader indices. However, market-men turned cautious as the Plan panel warned that persistent policy logjam could pull down the annual average economic growth rate in the 12th Five Year Plan (2012-17) to 5-5.5 percent, from 7.9 percent recorded in the 11th Plan. Also, Chief Economic Advisor Raghuram Rajan has said that more painful decisions are needed to check deficit and diesel price hike and cut in subsidized LPG cylinders are only the first steps.

Caution ahead of political stalemate in the US over a deal to avert the fiscal cliff too kept the bulls under check. European counters showed mixed trend in early trade on Monday on concerns about the ongoing budget negotiations in Washington and worries about the Italian political landscape after the resignation of the country’s prime minister last week. However, Asian markets provided some support to the domestic bourses as most of the Asian equity indices ended in the positive terrain despite anxiety about the risk of the United States failing to avert a fiscal crisis.

Back home, major support came in from software and technology pack with both the counters garnering about a percent gain. Stocks like Infosys, Wipro, HCL Technologies, TCS and Oracle Financial Services Software firms were up on the back of weak rupee which helps boosts topline as major portion of their revenues come from exports to the US. FMCG stocks like Hindustan Unilever, Bajaj Corp, Colgate-Palmolive, Marico, Bliss GVS, Dabur India and Procter & Gamble too aided the momentum after the Centre said that as per reports received from different states, sowing of rabi or winter crops is progressing well in different parts of the country. Sentiments also got some support after shares of two-wheeler makers rose on expectations of pickup in sales during the ongoing wedding season. However, gains remained capped after Index heavyweight Reliance Industries ended in the red with a cut of 0.35 percent.

The NSE’s 50-share broadly followed index Nifty rose by eight points to end above its psychological 5,850 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex rose by over thirteen points to finish above the psychological 19,250 mark. Moreover, broader markets too were traded in the green throughout the session ending with a gain of over 0.30 percent.

The overall volumes stood above Rs 1.91 lakh crore, which remained on the lower side as compared to that on Friday. The market breadth was evenly divided with 1,448 shares on the gaining side against 1,431 shares on the losing side while 156 shares remain unchanged.

Finally, the BSE Sensex gained 13.09 points or 0.07% to settle at 19255.09, while the S&P CNX Nifty rose by 8.05 points or 0.14% to end at 5,855.75.

The BSE Sensex touched a high and a low of 19347.64 and 19237.26, respectively. The BSE Mid-cap index was up by 0.36% and Small-cap index was up by 0.32%.

The top gainers on the Sensex were, Tata Motors up 2.44%, Wipro up 1.78%, Sun Pharma up 1.46%, Infosys up 1.15% and Tata Power up 1.09%, while, Jindal Steel down by 1.93%, ONGC down by 1.88%, Maruti Suzuki down by 1.60%, Sterlite Industries down by 1.58% and Reliance down by 0.36% were the top losers on the index.

The top gainers on the BSE Sectoral space were, TECk up 0.95%, Realty up 0.91%, IT up 0.87%, Health Care (HC) up 0.81% and Auto up 0.46%, while Metal down 0.53%, Oil & Gas down 0.43%, Consumer Durables (CD) down 0.16%, PSU down 0.14% and Capital Goods (CG) down 0.07% were top losers on the space.

Meanwhile, the Union Minister of Commerce Industry and Textiles, Anand Sharma at the 5th meeting of the Government-Industry Joint Task Force, expressed concern over the trade performance as exports in April-November 2012 declined by 5.9% to $ 189.2 billion and assured the Industry that measure to support exporters will be announced by December 24.

He stated that the slowdown in manufacturing has huge implications in terms of employment and social cohesion and industry has voiced its concern including cost of manufacturing, weak disbursement of credit and high transaction costs. Further stating, the minister said that he intends to hold the 1st meeting of the Manufacturing Industry Promotion Board in the near future to review the state of this very critical sector as well as the progress in the implementation of the National Manufacturing Policy. Commerce minister pointed out that the nature of manufacturing, changes to more capital intensive manufacturing, the rate of growth to sustain employment would have to be at least 12%-15%. 

On SEZ policy Anand Sharma said that to make this policy more attractive the department is in the process to finalisation of the revised SEZ policy in consultation with the ministry of finance and hoped that before the next Budget, the ministry will be able to announce the changes. The Minister pointed out that the Government has taken some concrete measures for reviving the investment sentiments, both domestic and foreign front like FDI in multi brands retail upto 51% while stipulating that at least half of the investment will go for creating backend infrastructure.

The S&P CNX Nifty touched a high and a low of 5,871.90 and 5,844.70 respectively.

The top gainers on the Nifty were Tata Motors was up 2.71%, Sun Pharma up 1.82%, DLF up 1.80%, Lupin up 1.75% and Wipro up 1.65%.

The top losers on the index were Jindal Steel down by 2.44%, Ultra Cement down by 2.24%, ONGC down by 1.97%, Maruti down by 1.88% and Grasim down by 1.47%.

The European markets were trading in red, France’s CAC 40 down by 0.19% and the United Kingdom’s FTSE 100 down by 0.07%.

Asian markets ended mostly up with thin volume in a pre-holiday trade on Monday as sentiments were quite cautious amid the risk of the US failing to avert a fiscal crisis. Hang Seng market closed higher, with Hong Kong financial markets closing at midday for the Christmas holiday, while shanghai market went home with green mark on expectation for more public fund allocations.

Japanese and Indonesian markets remained closed on Monday for public holidays.