Sensex finishes choppy session on a quiet note

After showcasing a strong performance in the last session, stock markets in India slipped into consolidation mode on Wednesday, as investors booked their profit due to lack of fresh trigger. Though, in the last leg of trade, bourses gained some strength and got its green trajectory back but the psychological 5,450 (Nifty) and 17,900 (Sensex) levels proved as difficult nuts to crack for the frontline indices and the benchmark equity indices snapped the session with trivial losses. The markets hardly budging from their previous closing levels as investors lacked conviction to open fresh positions amid a lot of uncertainties surrounding the global as well as domestic markets.

The key gauges gyrated in a tight range in negative territory for most part of the day as sentiments remain subdued as interest rate sensitive realty shares fell on profit booking after recent gains, triggered after data released last week showed that the rate of growth in inflation based on the wholesale price index (WPI) fell to the slowest pace in nearly three years in July 2012, building hopes that the central bank will find more space to ease monetary policy and revive industrial growth. Moreover, power space still felt the impact of CAG report and declined by about 0.80 percent. Private power producers like Tata Power, RPower, Adani Power, GMR Infra and Reliance Infrastructure all edged lower as CAG report said the loss was due to allocation of coal mines to private players.

Global cues too remained subdued as a raft of disappointing earnings results pushed global stocks markets lower on Wednesday. European shares slipped from 13-month highs in the early trade as investors weighed up whether signs of progress in the euro zone debt crisis warranted the recent surge. While, most of the Asian equity indices ended the session in the red on account of Japan’s trade deficit widening to 517.4 billion yen ($6.5 billion) in July, compared with a revised 60.3 billion yen surplus in June, mainly due to Europe’s sovereign-debt crisis and a slowdown in China, which dragged down nation’s exports.

Back home, some pressure also came in after both the houses of Parliament were adjourned for a second consecutive day after the opposition parties created a ruckus over the Comptroller and Auditor General’s report on coal block allocation. The CAG reports have estimated ‘undue benefits’ of over Rs 3.06 lakh crore to private parties in coal block allocation without bidding. However, the losses remained capped on report that the Finance Ministry has approved foreign direct investment in insurance and pension sectors up to 49 percent. The downside also remained limited after Airline stocks jumped ahead of meeting of newly-formed United Progressive Alliance (UPA) coordination committee today to discuss foreign direct investment (FDI) in aviation sector.

The NSE’s 50-share broadly followed index Nifty, declined merely eight points but hold the psychological 5,400 support level while Bombay Stock Exchange’s Sensitive Index - Sensex lost about forty to finish below its crucial 17,850 mark. Moreover, the broader too were completely lackluster and snapped the session in the red trajectory.

Meanwhile, the markets overall volumes stood over Rs 1.50 lakh crore on Wednesday. The market breadth remained optimistic as there were 1,277 shares on the gaining side against 1,223 shares on the losing side while 137 shares remained unchanged.

The BSE Sensex lost 38.40 points or 0.21% to settle at 17,846.86, while the S&P CNX Nifty declined by 8.15 points or 0.15% to close at 5,412.85.

The BSE Sensex touched a high and a low of 17,912.08 and 17,800.29 respectively. However, the BSE Mid cap index was down by 0.21% and Small cap index down by 0.22%.

Dr Reddys Lab up by 1.05%, Coal India up by 0.94%, Infosys up by 0.93%, Baja Auto up by 0.86% and Hero MotoCorp up by 0.85% were top gainers on the Sensex, while Bharti Airtel down by 2.82%, Tata Power down by 1.45%, Jindal Steel down by 1.16%, NTPC down by 1.15% and HDFC down by 1.06% were top losers on the index.

The major gainers on the BSE sectoral space were, Health Care up by 0.38%, Auto up by 0.24%, IT up by 0.14%, PSU up 0.12% and Bankex up 0.04%, while Realty down 0.97%, Power down 0.82%, TECk down 0.42%, Capital Goods down 0.41% and Consumer Durables down 0.30% were major losers on the BSE sectoral space.  

Meanwhile, despite stringent rainfall and an expected fall in sugar production in the current marketing year starting October 2012, the Central government has confirmed that there is no proposal to ban sugar exports. About 1.35 million tonne sugar has been exported this year so far.

Earlier, the Food Ministry had planned to restrict sugar exports so as to control the rising retail prices, which had hit Rs 37-45 a kg in metros. The sugar prices started climbing up as the production lacked due to deficient rainfall in sugar cane producing states such as Maharashtra and Karnataka.

Sugar production is expected to be 26 million tonnes in the ongoing 2011-12 marketing year, and forecasts nearly 25 million tonne for the next marketing year starting October 2012. In May, the Centre had freed sugar exports and took it under the Open General License (OGL).

The S&P CNX Nifty touched a high and low of 5,433.35 and 5,394.80 respectively.

The top gainers on the Nifty were Ranbaxy up by 4.28%, BPCL up by 2.67%, Bank of Baroda up by 1.52%, Infosys up by 1.27% and Dr Reddy up by 1.05%. On the flip side, Bharti Airtel down by 3.98%, IDFC down by 1.73, Sesa Goa down by 1.68%, NTPC down by 1.58% and Sterlite Industries down by 1.49% were the major losers.

The European markets were trading in red, France's CAC 40 down by 0.74%, Germany's DAX was down by 0.76% and United Kingdom’s FTSE 100 was down by 1.00%.

Most of the Asian markets ended in the negative zone, on the back of wider-than-expected Japan’s trade deficit. Before making any string position, investors are waiting for developments from a euro-area finance ministers meeting this week to discuss details of the bailout package for Greece. Fall in Hang Seng market continued with weakness in resource stocks, Shanghai Composite fell with the property sector suffering the biggest percentage fall of the index’s five main industry groups.