Markets gain on hopes Rajya Sabha may approve retail FDI

Index heavyweights lead Sensex gains

Markets ended higher on Thursday on expectations that the FDI in mutli-brand will be approved by the Rajya Sabha amid support from the Bahujan Samaj Party which said it will vote in favour of the government.

The 30-share Sensex provisionally ended up 113 points at  19,505 and 50-share Nifty ended up 38 points at 5,938.


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(Updated at 14:25hrs)

Benchmark share indices have trimmed the losses but maintain the lower trend led by weakness among IT, Capital Goods and Banking shares. Markets remain cautious ahead of FDI vote in Rajya Sabha where the government must hold majority to defeat the Opposition motion against the contentious measure.

At 1420, Sensex was down 80 points at 19,312 and the 50-share Nifty was down 25 points at 5,876. The Sensex and the Nifty have touched an intra-day low of 19,186 levels and 5,839 mark, respectively.

On the global front, Asian shares ended the day on a mixed note after rising to a 16-month high on caution ahead of European Central Bank's policy decision later today and ahead of key U.S. jobs report on Friday that will draw a clear picture of state of economy in US.

Stocks in Europe extended a week-long rally on Thursday while the euro slipped as investors awaited a European Central Bank policy meeting for signs of any future interest rate cuts.

The ECB is expected to keep its benchmark rate at 0.75%. However, markets are looking for clues on whether the deepening recession across the euro zone will prompt President Mario Draghi to signal a further easing in policy.

European stocks covered by the FTSE Eurofirst 300 index, which hit its highest level for the year this week, edged up 0.2% to 1,126.13 points in early trade. London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX were as much as 0.35% higher.

Back home, the Indian rupee failed to maintain initial gains against the American currency and was quoted at 54.53 per dollar on fresh dollar demand from banks on the back of firm dollar overseas.

Building on improvement in October, the consumer sentiment moved up in November due to spurt in purchases during the festival period, according to BulFin Consumer Confidence Index (CCI).

On the sectoral front, BSE IT index has tumbled by nearly 2% followed by counters like TECk, Capital Goods, Healthcare, Banks, Power, PSU, Oil & Gas and Metal, all declining between 0.1-1%. However, BSE Realty and Consumer Durable indices have gained by nearly 1% each.

From the IT space, Infosys, Tata Consultancy Services, HCL Technologies, Wipro and Hexaware Technologies are trading lower by 1-2% on the Bombay Stock Exchange (BSE).

Shares of Information technology (IT) companies continue to be under pressure for second day in a row after Cognizant Technology Solutions said that it expects 16% revenue growth in 2013 as against its projected 20% growth for the current year 2012.

Bharti Airtel has declined by over 2%. Fitch Rating today said the balance sheets of Indian telecom companies will continue to weaken in 2013 due to funding regulatory payments and re-acquire expensive licences. They will have limited room to hike tariffs due to intense competition in sector. The outlook on Indian telecom sector was negative, Fitch said in a statement.

Capital Goods major L&T and BHEL have slipped between 0.5-1%.

Banks which are a proxy to the economy also faced the brunt of selling pressure. HDFC Bank and ICICI Bank have declined between 0.3-1%.

Other notable losers include Cipla, Hindalco, GAIL, NTPC, M&M and ONGC.

On the gaining side, Sterlite is the top Sensex gainer, up almost 2%.

Tata Motors, Bajaj Auto and Maruti Suzuki have gained between 0.3-1%. Maruti Suzuki India today said it will increase the prices of its vehicles across all models by up to Rs 20,000 from January due to increasing pressure on its margins due to currency fluctuation.

Among other shares, Adani Enterprises has moved higher by about 6% at Rs 264 on back of over two-fold jump in trading volumes.

The broader indices are outperforming the benchmarks. The market breadth in BSE remains marginally negative with 1227 shares declining and 866 shares advancing.