IT shares lose sheen in a flat market; Wipro drops 2%

Markets have wiped off its gains and have turned flat with a negative bias owing to weakness in IT shares on the back of an appreciating rupee with Infosys trading nearly 1% lower ahead of the quarterly results due next week. Meanwhile, select financials are reeling under pressure and have capped the upside gains.

At 1 PM, the Sensex is up 2 points at 26,935 and the Nifty has lost 7 points at 8,146. Top losers on the Sensex include Wipro, Bharti Airtel, Axis Bank, ICICI Bank and Dr Reddy’s Lab and HUL down between 1-2%.

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(updated at 1PM)

Markets continue their ascent for the sixth consecutive trading session amid volatility mainly due to buying seen in the metal shares. The Prime Minister’s statement that the government is looking hopeful to introduce Goods and Services tax (GST) from the next financial year has also boosted the sentiment of the market participants.

By noon, the Sensex was higher by 50 points at 26,983 and the Nifty gained by 6 points at 8,159.

Among broader markets, BSE Midcap and Smallcap indices are up 0.2-0.5%. Markets breadth is positive with 1,096 shares advancing and 480 shares declining.

Amid the positivity, the International Monetary fund (IMF) lower its forecast on global growth of 3.1% this year citing modest pickup in advanced economies and a slowdown in emerging markets, primarily reflecting weakness in some large developing nations and oil-exporting countries.

Meanwhile, the IMF has lowered India’s growth forecast for FY16 to 7.3 per cent from its July forecast of 7.5 per cent.

RUPEE

On the currency front, the Indian rupee strengthened by 20 paise to quote at 65.27 against the greenback on sustained bouts of dollar selling by banks and exporters amid weakness in dollar overseas.

CRUDE OIL

Buoyant oil prices sustained a rally in Asia today driven by hopes the crude supply glut would ease and expectations the US central bank would hold off from raising interest rates.

SECTORS & STOCKS

Sectorally,  BSE Realty is trading with nearly 2% gains followed by BSE Metal and Auto indices , up between 1-1.7% gains.  On the downside, BSE healthcare index is trailing with 0.2% losses.

Oil shares are witnessing buying demand on rising crude oil prices. Crude oil prices rose more than 1%, adding to their gains from Monday and boosting the energy index by 1.3%.

Shares of oil exploration & production companies such as Oil and Natural Gas Corporation (ONGC), Cairn India and Oil India were trading higher by up to 4% on the BSE.

The report of the technical consultant on the dispute related to natural gas reserves in the Krishna-Godavari (K-G) basin between ONGC and Reliance Industries Ltd (RIL)  is set to be delayed by a few weeks to a month. RIL is down 0.3%

Oil Marketing companies are trailing. IOC, BPCL, HPCL are down between 0.5-1.8% each.

Consumer Durables shares have extended gains ahead of festive season buoyed by reduction in interest rates by banks. Rajesh Export, PC Jewellers, Blue Star, Videocon, TTK Prestige and Whirphool have gained between 0.3-4.3%.

HDFC has raised Rs 5,000 crore from low- cost non-convertible debentures (NCDs) and a further amount of about Rs 5,400 crore would come in from warrants, both of which got listed with a huge premium today. Shares of HDFC are up almost 1%.

Sun Pharmaceutical Industries has sought shareholder approval to raise up to Rs 12,000 crore through convertible debentures or a qualified institutional placement (QIP). The stock is trading flat.

ICICI Bank has reduced the interest rate on its home loans by only 25-30 basis points (bps), even though it reduced its base rate by 35 bps last week. The stock is down nearly 1%

Shares of sugar companies are trading higher for the second straight day after commodity prices have jumped 24% in the past two months on expectations of improved demand during the festival season in the domestic market and on global forecasts of shortage during the next crushing season.

Dhampur Sugar Mills, Shree Renuka Sugars, Bajaj Hindustan Sugar, Balrampur Chini Mills, Sakthi Sugars, Dwarikesh Sugar Industries, Thiru Arooran Sugars, Dalmia Bharat Sugar and Industries were trading higher in the range of 5% to 20% on the BSE. Most these stocks had gained up 16% on Tuesday.

Shares of logistics companies are trading higher on the bourses after the Prime Minister Narendra Modi said on Tuesday that he was hopeful of rolling out the GST (goods and services tax) Bill in 2016.

Among the individual stocks, Gati has rallied 13% to Rs 143 on the BSE on back of heavy volumes