Markets turn choppy on mixed Q2 results; Cipla, BHEL dip 3%

Benchmark indices have erased early gains and have turned choppy  in the noon trades on mixed corporate earnings shrugging off  strong macro economic data. 

 

WPI-based inflation declined to 1.77% in October, down from 2.38% in September. Earlier during the week, the  retail inflation eased to 5.52% in October and industrial production grew at 2.5% in September.

 

At 12.55 PM, the 30-share Sensex is up 61 points at 28,002 and the 50-share Nifty is up 17 points at 8,375.

 

The broader market has outperformed their larger peers and BSE midcap and smallcap indices have gained around 1% each. The market breadth in BSE remains firm with 1,490 shares advancing and 1,264 shares declining.

 

The rupee is trading weaker at 61.62 versus Thursday's close of 61.54 against US Dollar.

 

Meanwhile, on Thursday, foreign institutional investors were net buyers in Indian equities worth Rs 690.61 crore, as per provisional stock exchange data.

 

Sectors & Stocks:

 

On the sectoral front, BSE Metal index is up 2% followed by Realty and Power indices trading higher over 1% each. However, BSE Healthcare index is the only index which is trading nearly 1% lower.

 

GAIL has surged more than 2% after incorporating a new company, TAPI Pipeline Company along with state gas companies of Turkmenistan, Afghanistan and Pakistan to build, own and operate the 1,800 Km TAPI natural gas pipeline.

 

Select financials have rebounded from yesterday’s decline. Axis Bank has gained around 1% and SBI Bank has gained around 1.6%. State Bank of India today reported a Q2 net profit of Rs 3,100 crore as compared to Rs 2,375 crore in the year-ago quarter, an uptick of 30.5%.

 

The PSU bank's gross NPA was flat at 4.89% on a q-o-q basis. Net NPA came down to 2.73% in the quarter from 2.91% the previous quarter.

 

Metal shares are trading higher in the noon trades on fresh buying. Hindalco, Coal India, Sesa Sterlite and Tata Steel are up between 1-2%. Hindalco Industries, the flagship company of the Aditya Birla Group, reported a lower-than-expected standalone net profit of Rs 79 crore in the September 2014 quarter, 78 per cent lower than Rs 357 crore in the year ago period, even as the company's net sales rose significantly.

 

Sustained fall in crude prices has brought oil and gas shares in focus. Reliance and ONGC have gained around 0.5-1.7% each. ONGC quarterly results are expected later today.

 

Bajaj Auto, Wipro, Tata Motors and Infosys are some of the notable gainers on the BSE.

 

On the flip side, Healthcare shares are trading under pressure. Cipla is down 3% after the company  posted a consolidated net profit of Rs 299 crore for the quarter ended September 30, 2014 as compared to a net profit of Rs 358 crore during the same period of last year failing to meet the street expectations. The estimated net profit of the company was Rs 354. Dr Reddy’s Lab is down 1.5%.

 

Sun pharma is trading lower by 2% despite reporting a 15% increase in its Q2 net profit as market had estimated a better performance on account of the higher earnings reported by its US subsidiary, Taro.

 

Engineering major BHEL is the top loser down over 3.5% on the back of poor quarterly numbers.

 

Tata Power is down nearly 2.5% to Rs 86.40 as the consolidated revenue was down 4% to Rs 8,394 crore due to shutdown of a unit in company's Trombay plant and lower realisation in its coal business. Interest cost rose 22% to Rs 980 crore from Rs 803 crore in second quarter of last fiscal.

 

HDFC, HUL and M&M are some of the prominent losers on the BSE among others.