Mid-cap, Small-cap indices outperform benchmarks

At 10:20am, the Sensex and Nifty were trading lower by 0.5% each

The markets are trading in a listless manner as they seek for direction post the gains seen in the previous session. At 10:20am, the Sensex was at 27331, lower by 65 points and the Nifty is at 8265, down 20 points.

There is outperformance on the broader market front, with the midcap and smallcap indices adding around half a percent each.

The markets had rallied in late trades on Tuesday to snap a three-day losing streak, with the Sensex jumping by more than 200 points, thanks to the good numbers posted by banking heavyweight ICICI Bank and auto major Maruti Suzuki.

The investors were also cautious ahead of the US Federal Reserve two-day policy meet which ends later today. Japanese markets were closed today. The Shanghai Composite was down 1% while Hang Seng eased 0.4% and Straits Times slipped 0.3%.

EXPERT VIEW

Markets are likely to remain volatile ahead of the April derivative contracts tomorrow. One should avoid forming fresh short position in Nifty as we are expecting some bounce, analysts say.

"FIIs have been actively buying Stock Futures in last trading sessions. Roll-over in Nifty and BankNifty is on the higher side at 36.59% & 39.38% respectively but in terms of open interest is low. The total open interest (OI) of the market is Rs 254,197 crore and the stock futures OI is Rs 70,495 crore," said a morning note from Angel Broking.

As regards key levels, analysts at Anand Rathi suggest that the Nifty now needs to hold above 8,280 zones to witness a bounce back move towards 8,380 - 8,420 levels. However, if it fails to hold its 8,250 levels then further profit booking may drag the index towards 8,180 - 8,150 levels. Bank Nifty, on the other hand, needs to stay above 18,150 to witness up move towards 18,500 - 18,800 levels. Else, weakness may again drag it to 18,000 levels.

GLOBAL MARKETS

Major US share indices ended mixed with the Nasdaq ending flat with negative bias after Apple shares lost ground and ended 1.6% lower.

Meanwhile, the Dow Jones industrial average and the broader S&P 500 ended higher led by gains in global pharma major Merck and IT major IBM. The Dow Jones gained 72 points to end at 18,110.14, the S&P 500 ended up 6 points at 2,114.76 and the Nasdaq eased 5 points to close at 5,055.42.

SECTORS & STOCKS

The FMCG and IT sectors are continuing their recent weakness, while the pharma sector is seeing buying interest this morning.

In the FMCG space, ITC and United Spirits have shed between 1% and 2% each; Hindustan Unilever is, however, bucking the weak trend and has gained 1% at Rs 867.

In the IT space, Infosys and TCS have shed between half a percent and 1% each. On the other hand, the pharma space is in good health this morning. Wockhardt has soared by more than 3% at Rs 1282 after nose-diving by around 25% in the past two sessions, in a case of bottom fishing post the fall.

Telecom shares are trading lower post their March quarter earnings. Bharti Airtel has shed 0.9% at Rs 398 despite reporting a 30.5% growth in net profit at Rs 1,255 crore for the quarter ended March this year, owing to growth in data revenue.

Idea Cellular is also trading flat, with a negative bias, at Rs 191 after its consolidated profit after tax increased 60% to Rs 942crore for the fourth quarter ended March 2015 against Rs 589.8 crore for the same quarter March 2014.

Mortgage lender HDFC has shed 1.5% at Rs 1208, while private banking major Axis Bank has added 2.2% at Rs 547 ahead of their March quarter earnings scheduled later in the day.