Markets stage a smart recovery; Nifty ends above 7,650

Markets ended flat with a positive bias after making a smart recovery in late trades led by IT shares. Indices reeled under selling pressure in early trades as investors turned cautious and booked profits on worries over lower-than-projected monsoon rains.

India Meteorological Department (IMD), the government’s official weather forecaster on Monday said it expected monsoon rainfall this year to be 93 per cent of the 50-year average since 1950 (called long-period average, or LPA), against the 95 per cent it had projected earlier — both levels are considered sub-normal. There are high chances of the emergence of an El Niño weather formation, obstructing the formation of clouds, it said.

The 30-share Sensex ended up 3 points at 25,584 and the 50-share Nifty ended up 2 points at 7,656. The Sensex and the Nifty touched an intraday low of 25,347 and 7,579 mark, respectively.

The broader markets ended mixed- BSE Midcap index declined by 0.3% whereas the Smallcap index ended marginally positive.

The market breadth in BSE ended positive with 1,837 shares advancing and 1,266 shares declining.   

Foreign portfolio investors (FPIs) bought shares worth a net Rs 536.68 crore on Monday, 9 June 2014, as per provisional data from the stock exchanges.

GLOBAL MARKETS

Japan's Nikkei share average fell to a one-week low on Tuesday in choppy trade as investors took profits after the weak yen trend paused, while Mitsubishi UFJ Financial Group (8306.T) rose on a brokerage upgrade.

The Nikkei shed 0.9% to 14,994.80, the lowest closing since June 2. The broader Topix dropped 0.5% to 1,228.73, while the new JPX-Nikkei Index 400 slipped 0.5% to 11,190.69.

INDIAN RUPEE

The rupee is trading at 59.30/31 versus its close of 59.20/21 on Monday, tracking losses in the domestic share market and falls in other Asian currencies versus the dollar.

Traders will continue to monitor foreign fund flows into the domestic share and debt markets for direction. Foreign investors bought a net $826.9 million in debt markets on Friday, the highest single-day flows since Jan 15.

SECTORAL INDICES

BSE Realty index slumped by almost 3% followed by counters like Oil & Gas, Capital Goods, Banks Power and Metal, all declining between 1-2%. However, BSE Consumer Durables index zoomed by almost 4% followed by counters like IT, Healthcare and TECk, all surging by 2% each.

BSE Realty index which gained more than 15% in June, took a breather today. Oil shares which had gained sharply on talk of hike in gas prices witnessed profit taking.

Shares of two-wheeler makers declined on worries below normal monsoon rains this year will impact rural demand for two-wheelers.

IT and pharma shares firmed up tracking weakness in the rupee.

GAINERS & LOSERS

The main losers on the Sensex were ONGC, Hero Moto, Sesa Sterlite, Tata Steel, BHEL, Tata Power, SBI and GAIL.

Shares of public sector undertaking (PSU) banks were under pressure falling by up to 6% on profit booking. Union Bank of India, Canara Bank, Oriental Bank of Commerce, Syndicate Bank, Allahabad Bank, Indian Overseas Bank (IOB) and Punjab National Bank (PNB) were down 3-6%.

IDBI, Bank of India, Andhra Bank, Bank of Baroda (BOB) and State Bank of India gained between 1-2% on the National Stock Exchange (NSE).

Larsen & Toubro which had gained on talk of upgrade in railway infrastructure including high speed trains was down 1%.

On the gaining side, Cipla, Wipro, Infosys, Coal India, TCS, Sun Pharma and Maruti Sizuki gained between -2.5%.

Coal India moved higher by over 2% to Rs 420, its new high on BSE, extending its previous day’s 6% rally, on hopes of reforms in the coal sector.

Essar Group stocks – Essar Port, Essar Oil and Essar Shipping, ended higher by up to 20% on back of heavy volumes in otherwise weak market.  Essar Port and Essar Oil were trading at their 52-week highs on the bourses.

Amtek India surged nearly 20% to Rs 101, also its 52-week high, on back of heavy volumes on the National Stock Exchange (NSE).

BEML ended higher by 5% to Rs 817, extending its 17% rally in past three trading sessions, on hopes of the government will introduce new policies and liberalised foreign direct investment (FDI) in the defence sector.

Suzlon Energy was locked in upper circuit for fifth straight trading sessions, up 5% at Rs 34.35 in early morning deals on the Bombay Stock Exchange (BSE).