Markets trade flat, Nifty holds 8,500; broader markets outperform

Markets are trading on a flattish note in opening trades tracking mixed trend among global cues.

Participants have turned cautious after sharp gains in the previous sessions and ahead of the June quarter earnings of IT majors TCS and Infosys. TCS is scheduled to announce the June quarter earnings today post market hours.

By 9:30 am, the S&P BSE Sensex slipped 30 points at 27,786 and Nifty50 dipped 10 points to trade at 8,509. Broader markets are outperforming the benchmark indices- BSE Midcap and Smallcap indices are up 0.3%-0.4%.

Vinod Nair, Head of Research, Geojit BNP Paribas Financial Services says, “The positive undercurrent in the global market in expectation of stimulus by world central banks like BoJ, BoE and ECB is supporting India. But any deviation in the Q1 earnings compared to the recent momentum in share prices will cause consolidation in the domestic market."

In overseas stock markets, Asian markets were trading lower ahead of Bank of England's interest rate decision later in the global day. In US stocks, the S&P 500 and Dow Jones Industrial Average scored meager gains yesterday but enough to extend their run into record territory and advance for a fourth session in a row.

However, the tech-heavy Nasdaq Composite index took a breather following a five-session climb to end lower. Stocks got a slight bump from the US Fed's beige book report released yesterday which indicated that the US economy is holding steady although consumption may be softening.

The Bank of England meets today and analysts expect it to lower its benchmark lending rate by a quarter of a percentage point to 0.25% to counter the fallout from the Brexit vote.

Closer home, foreign portfolio investors (FPIs) bought shares worth a net Rs 290.53 crore yesterday as per provisional data released by the stock exchanges.

TCS, Cyient, Canfin Homes, Vimta Labs among others are scheduled to announce their quarterly results today. Among key stocks, GAIL, HDFC, Power Grid, Adani Ports and L&T are up 0.6%-2%.

Housing Development Finance Corporation’s (HDFC)’s masala bonds’ issue has so far seen two-three times subscription for the coupon rate the mortgage lender is perceived to issue the paper at. The stock rose marginally.

Tata Steel’s Kalinganagar steel project in Odisha targets to sell 1.5 million tonne of hot rolled (HR) coils in FY17, the first year of its commercial operation. Shares of Tata Steel are up 0.4%.

India’s largest automobile company, Tata Motors, has set its eyes on being among the top three global commercial vehicle makers and reclaiming its number three spot in the country’s car and sports utility vehicle market. The stock is up almost 1%.

On the losing side, auto majors like M&M, Hero Moto and Bajaj Auto have slipped almost 1% each.

Mahindra & Mahindra (M&M) announced the incorporation of subsidiary company in the name of Merakisan to carry on the business of procuring and marketing agricultural produce including fruits and vegetables.  

Bajaj Auto turns ex-dividend today for final dividend of Rs 5 per share for the year ended 31 March 2016.

Shares of Dr Reddy’s Labs are down almost 1% after the pharma major is recalling 9,330 bottles of Sirolimus tablets, used for prevention of organ rejection after kidney transplant, in the US due to presence of impurities.

NBCC (India) has gained around 4% after the Cabinet Committee on Economic Affairs approved disinvestment of 15% paid up equity of the company out of Government of India's (GoI) 90% shareholding.