Markets open marginally higher; Pipavav Defence slumps 10%

The 30-share Sensex was up 44 points at 29,424 and the 50-share Nifty was up 7 points at 8,929.

Markets opened marginally higher, amid mixed global cues, led by IT majors and a rebound in index heavyweight ITC after losses in the previous few sessions.

At 9:30AM, the 30-share Sensex was up 69 points at 29,450 and the 50-share Nifty was up 9 points at 8,932.

Benchmark indices failed to sustain gains yesterday and retreated from day's high dragged primarily by the losses in metals, information technology and bank shares as investors started to book profits in late noon deals. Earlier, markets had scaled fresh all-time highs on the surprise post-budget rate cut by Reserve Bank of India (RBI).

Meanwhile, foreign portfolio investors (FPIs) bought shares worth a net Rs 2786.24 crore yesterday, as per provisional data. Domestic institutional investors (DIIs) bought shares worth a net Rs 16.89 crore yesterday, as per provisional data.

ON THE CHARTS

Technical analysts expect the markets to continue facing selling pressure at higher levels. "Nifty has observed a sharp decline from its recent highs and has closed below the 9000 levels. The index faces crucial hurdles at 8,980-9,000 levels on the upside, expect selling pressure to continue at higher levels," said a morning note from Nirmal Bang.

The display of lack of strength during upmove of previous few sessions, point out analysts with HDFC Securities in a note, seems to have resulted in a sharp dip in the market yesterday. They expect the Nifty to show minor corrections ahead down to 8,780-8,800 levels in the next two-three sessions.

"The significance of lower levels supports around 8780-8800 is the upper and lower area of symmetrical triangle as per change in polarity and higher bottom principle. However, immediate resistance is placed around 9000 levels," they suggest.

ASIAN MARKETS

Asian stocks slipped on Thursday after Wall Street continued to pull back from record highs ahead of Friday's closely-watched U.S. jobs data, while the nervous euro languished at an 11-year low prior to the European Central Bank's policy meeting.

MSCI's broadest index of Asia-Pacific shares outside Japan. Japan's Nikkei lost 0.2% and South Korean and Australian shares also posted modest losses.

Before slipping on Tuesday for the second successive session, both the Dow and S&P hit record highs on Monday, when the Nasdaq reached a 15-year peak.

BUZZING STOCKS

Anil Ambani’s Reliance Defence Systems, along with Reliance Infrastructure, has acquired Pipavav Defence, a private shipyard based in Pipavav in Gujarat, in an all-cash deal. As per the deal Reliance Infrastructure will acquire 18% stake from promoters of Pipavav Defence at Rs 63 per share and also make an open offer for addditional 26% stake at Rs 66 per share. Pipavav Defence is down 10% as the proceeds from the deal would go to the promoters and not the company while Reliance Infrastructure was up nearly 3%.

In the telecom pack Bharti Airtel and Idea Cellular were down 1-2%. The telecom spectrum auction got off to an enormous start on Wednesday, the first day, with bids worth Rs 60,000 crore.

Cairn India was down nearly 1% after it lowered its capex guidance.  The oil explorer has announced a 58% reduction in its projected capital expenditure for the next financial year to $500 million from the earlier projection of $1,200 million.

In the broader market, the BSE Mid-cap and Small-cap indices were up 0.6% each. Market breadth was strong with 951 gainers and 456 losers on the Bombay Stock Exchange.