Broader markets outperform benchmark indices

Markets were marginally down in late morning trades weighed down by profit taking in private banks and RIL

Markets were marginally down in late morning trades weighed down by profit taking in private banks and index heavyweight Reliance Industries. However, the broader markets outperformed the benchmark indices as investors shifted stance to quality mid-cap stocks.

At 11:30AM, the 30-share Sensex was down 66 points at 20,183 and the 50-share Nifty was down 14 points at 5,993.

Asian markets continued to exhibit a mixed trend as the continuing shutdown in the US over the budget and raising of debt ceiling weighed on investor sentiment. The Nikkei was up 0.8%, Straits Times rose 0.4% while Hang Seng and Shanghai Composite were down 0.8-0.9% each.

Meanwhile, the Indian rupee remained weak against the US dollar due to importers rushing to cover up their near term requirements ahead of the US debt payment deadline.

At 11:15am, the rupee was quoting at Rs 62.20 compared with previous close of Rs 61.94 per dollar.

Bankex was the top sectoral loser on the BSE followed by Oil and Gas, Power, Capital Goods, FMCG and IT indices.

"Banking space witnessed support based buying interest in previous trading session at lower levels along with fresh long built up. however it is facing major hurdle near 10500-10600 zone once this levels are crossed then a fresh rally may start for 11000-113000 levels on higher side. among banking space we are bullish on ICICI Bank for immediate target of 985-1000 levels. Traders can buy with stop loss below 925 levels," said Chetan Jain,

Deputy Manager (Derivatives Desk) - Equity Research, Anand Rathi Financial Services

Private banks ICICI Bank and HDFC Bank which had gained yesterday witnessed profit taking at higher levels. ICICI Bank was down 1.2% while HDFC Bank slipped 2% and HDFC was down 0.6%.

Among the index heavyweights, Reliance Ind was down 0.9% and ITC slipped 0.7%. Other Sensex losers include, TCS and Sun Pharma.

Auto shares were among the top gainers on hopes of revival in demand after banks have started reducing interest rates on retail loans. Tata Motors, M&M, Maruti Suzuki and Hero MotoCorp were up 0.5-1.0% each.

Metal shares also remained firm after select companies reported higher production numbers for September. Sesa Sterlite, Tata Steel and Jindal Steel were up over 1.3% each.

Infosys was marginally up by 0.4% ahead of its second quarter earnings tomorrow. "Infosys ahead of Result we are advising Butterfly strategy: Sell 3200 Call@ put with total inflow of 380 along with buy 2900 put@ 100 & buy 35000 call@45 ; Max Risk: 65; Max Reward: 235 ; LBEP: 2965; UBEP: 3435;," Jain said.

The broader market was trading with marginal gains. The BSE Mid-cap and Small-cap indices were up 0.4% each.

Market breadth was strong with 1,149 gainers and 761 losers on the BSE.