Market breadth turns negative from positive

Key benchmark indices once again weakened in afternoon trade amid volatility. The Sensex was down 56.32 points or 0.27%, off 149.58 points from the day's high and up 31.65 points from the day's low. The market breadth, indicating the overall health of the market, turned negative from positive in afternoon trade.

Index heavyweight and cigarette major ITC gained in volatile trade. Britannia Industries jumped after declaring strong Q2 result after market hours on Monday, 11 November 2013.Canara Bank surged after declaring Q2 result during market hours. Hindalco Industries rose ahead of its Q2 result today, 12 November 2013.

The market edged higher in early trade. It regained positive terrain after slipping into the red and hitting fresh intraday low in morning trade. It weakened and hit fresh intraday low in mid-morning trade. It recovered and hovered between positive and negative terrain after hitting fresh intraday low in early afternoon trade. Key benchmark indices once again weakened in afternoon trade amid volatility.

At 13:19 IST, the S&P BSE Sensex was down 56.32 points or 0.27% to 20,434.64. The index rose 93.26 points at the day's high of 20,584.22 in early trade. The index dropped 87.97 points at the day's low of 20,402.99 in early afternoon trade, its lowest level since 17 October 2013.

The CNX Nifty was down 11.25 points or 0.19% to 6,067.55. The index hit a low of 6,054.25 in intraday trade, its lowest level since 17 October 2013. The index hit a high of 6,108.70 in intraday trade.

The market breadth, indicating the overall health of the market, turned negative from positive in afternoon trade. On BSE, 1,110 shares declined and 1,082 shares gained. A total of 126 shares were unchanged.

The total turnover on BSE amounted to Rs 1114 crore by 13:20 IST.

Among the 30-share Sensex pack, 16 stocks fell and rest of them rose. Sesa Goa (down 2.77%), ONGC (down 1.72%) and Coal India (down 1.52%), declined.

Maruti Suzuki India (up 1.36%), Wipro (up 0.88%) and Sun Pharmaceutical Industries (up 0.96%), gained.

Index heavyweight and cigarette major ITC gained 0.84% to Rs 319.65, off day's low of Rs 317.

Britannia Industries jumped 4.19% after consolidated net profit jumped 65.7% to Rs 97.60 crore on 12.8% increase in revenue to Rs 1740 crore in Q2 September 2013 over Q2 September 2012. The result was announced after market hours on Monday, 11 November 2013.

Tata Motors lost 2.88%, with the stock extending Monday's 2.04% fall. The company's consolidated net profit surged 70.7% to Rs 3542 crore on 31.1% rise in revenues to Rs 56882 crore in Q2 September 2013 over Q2 September 2012. The company said revenues grew despite weak operating environment in the India business which was more than offset by increase in wholesale volumes and richer product and market mix at Jaguar Land Rover (JLR). The result was announced after market hours on Friday, 8 November 2013.

Canara Bank jumped 5.53%. The state-run bank during market hours reported 5.3% fall in net profit to Rs 625.94 crore on 13.3% rise in total income to Rs 10427.48 crore in Q2 September 2013 over Q2 September 2013 over Q2 September 2012.

Hindalco Industries rose 2.2% ahead of its Q2 result today, 12 November 2013.

Novelis, the US subsidiary of Hindalco Industries on Monday, 11 November 2013 reported net income attributable to its common shareholder of $23 million for the second quarter of fiscal 2014. Excluding certain tax-effected items, net income was $37 million for the quarter.

Adjusted EBITDA for the second quarter of fiscal 2014 was $228 million compared to $277 million reported for the same period a year ago. Sequentially, adjusted EBITDA improved 12% compared to the $204 million reported in the first quarter of fiscal 2014, in part due to initial success from the company's rolling expansion in South America. Excellent project execution allowed Novelis to meet strong market demand and puts the South America region on track to achieve record shipments this fiscal year.

"We are nearing an inflection point in the transition of our business from investment to growth," said Phil Martens, President and Chief Executive Officer for Novelis. "We have invested heavily in expanding our rolling, recycling and automotive finishing assets over the last three years to solidify our leadership position ahead of the strong market growth we expect, and we are beginning to see these results materialize. In fact, with the contribution from our expansions in South America and Asia, we expect results in the second half of fiscal 2014 to be stronger than the first half."

Martens also highlighted the company's stable business performance in North America, despite the challenging dynamics related to overcapacity in the North American can market which affected year-over-year results. "The reallocation of some hot mill capacity towards high-growth, high-margin automotive sheet in this region is not only a key piece of our growth strategy, it also will help rebalance the North American can market," said Martens. "We are aggressively increasing finishing capacity globally to support strong growth in the automotive flat rolled products market. Our two North American finishing lines are on track to produce commercial product by the end of this fiscal year and we are already evaluating additional investments."

Shipments of aluminum rolled products totaled 713 kilotonnes for the second quarter of fiscal 2014, down one percent compared to 719 kilotonnes for the same period last year but up one percent from the first quarter. Net sales for the second quarter of fiscal 2014 were $2.4 billion, flat compared to both the prior year and prior quarter.

For the second quarter of fiscal 2014, Novelis reported liquidity of $843 million. Free cash flow was $178 million for the second quarter of fiscal 2014 and capital expenditures totaled $184 million. "As expected, we generated positive free cash flow in the second quarter despite meaningful investments in growth, primarily due to significant improvements in working capital," said Steve Fisher, Chief Financial Officer for Novelis. "We will continue this diligent focus on cash generation and expect to drive positive free cash flow in the second half of this fiscal year as a result of working capital efficiencies and other cash improvement actions."

Torrent Power (up 8.67%), Indiabulls Real Estate (up 8.57%), Canara Bank (up 8.32%), REC (up 4.29%), Wockhardt (up 3.47%), Biocon (up 3.31%), HDIL (up 2.7%) and UCO Bank (up 2.43%) were the major gainers from BSE's 'A' group.

In the foreign exchange market, the rupee edged lower against the dollar as investors remained cautious ahead of consumer inflation and industrial output data. The partially convertible rupee was hovering at 63.5350, compared with its close of 63.24 on Monday, 11 November 2013.

On macro front, the government will unveil industrial production data for September 2013 today, 12 November 2013. Industrial output is projected to jump 3.7% in September 2013, as per the median estimate of the poll carried out by Capital Market. Index of industrial production (IIP) rose 0.6% in August 2013, showing moderation in growth from 2.8% growth recorded in July 2013.

Data on inflation based on the consumer price index (CPI) for October 2013 will also be unveiled today, 12 November 2013. The headline CPI inflation (combined) is projected to increase to 10% in October 2013, as per the median estimate of the poll carried out by Capital Market. The headline CPI inflation (combined) for September 2013 was placed at 9.84% (y-o-y), which came in higher than 9.52% (y-o-y) seen in August 2013.

Most Asian stocks edged higher on Tuesday. Key benchmark indices in China, Singapore, Taiwan, Japan and South Korea rose 0.03% to 2.23%. Key benchmark indices in Hong Kong and Indonesia shed 0.23% to 0.5%.

President Xi Jinping and Chinese Communist Party leaders today, 12 November 2013 conclude a four-day gathering aimed at mapping out a blueprint for reform, after data yesterday showed the nation's broadest measure of new credit fell by more than estimated in October.

Trading in US index futures indicated that the Dow could gain 13 points at the opening bell on Tuesday, 12 November 2013. US stocks rose on Monday, with the Dow Jones Industrial Average extending a record, as investors awaited retailer earnings reports to gauge the strength of consumer demand and the likelihood of cuts to monetary stimulus.

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