Lacklustre trend prevails

Markets are trading marginally lower in the noon deals. The Sensex has shed 39 points at 16,426 and the Nifty is at 4,951, down 16 points.

According to Somil Mehta, senior technical analyst with Sharekhan, "Markets are seen consolidating after the rise in the past few sessions and the short-term bias is positive. The supports for the Nifty are at 4,900 and 4,800. Resistances for the Nifty are 5,010 and 5,100."

Most of the Asian markets are trading on a subdued note. China's Shanghai Composite index has shed 1.5% or 35 points at 2,263 levels. Hang Seng is down 2 points at 19,624. However, Nikkei is trading higher by 1% at 8,550 levels.

Back home, Mahindra & Mahindra is the top loser among the Sensex stocks, down nearly 4% to Rs 678 on reports that the Income Tax Appellate Tribunal has ordered Mahindra Intertrade, a M&M subsidiary, to pay Rs 3.6 crore penalty for concealing income and furnishing inaccurate details about earnings.

ICICI Bank has shed 2.5% to Rs 765. Wipro, Tata Steel, TCS, Infosys, Gail India, Sterlite Industries, BHEL, Cipla, Hindustan Unilever, Hindalco and State Bank of India are also among the laggards.

However, Reliance Industries is the top gainer among the Sensex stocks. It is trading higher by 3.3% at Rs 765 after the company announced buyback plans before the markets opened for trade today. Deven Choksey, MD and CEO, KR Choksey Securities is of the view that it as a positive move by the company ahead of its third quarter results whuich are to be announced on Friday.

"This is not an unexpected move. We expect the company to report a weak set of numbers for the December 2011 quarter and this announcement will allow the floor price of the stock to be maintained."

"Going ahead, the stock may see more downside. Fundamentally, the company is on a strong footing and I suggest that investors buy the stock on a decline and hold for the long-term." adds Choksey.

ONGC, Hero MotoCorp, HDFC Bank, Maruti Suzuki, DLF, Coal India and HDFC are also among the gainers.

Technology, metal and banking stocks are amongst the worst hit in the trades so far. BSE IT index is the top sectoral loser down nearly 2% to 5,527 levels after the Indian rupee rose to a two-month high after foreign investors increased their investments in Indian debt and equities.

Metal and Bankex indices are also down, 1.6 and 1.3% each respectively. Auto capital goods,  power, FMCG, consumer durables and healthcare stocks are also facing the selling pressure.


At the same time, BSE Oil & gas index is the only gainer on the sectoral front, up 2.15% at 8,072 levels.

Hexaware Technologies, Tech Mahindra, MphasiS, Financial Technologies and HCL Tech are tyhe losers from the IT pack.

Among the individual shares, Automotive Axles has soared 10% to Rs 427 on reporting a net profit of Rs 19.73 crore for the first quarter ended December 2011, on the back of higher operational income.

KEC International has moved higher by 5% to Rs 51.40 after the company said it has secured an order worth of Rs 340 crore from Sterlite Technologies for the construction of 785 kv and 400 kv transmission lines in Maharashtra and Gujarat.

Shares of aviation companies have rallied in trade today after the government said it would soon launch the process to allow foreign airlines 49% stake in Indian carriers.

The broader markets are also trading lower. The BSE mid-cap index has shed 0.8% to 5,610 levels and the small-cap index is down 0.5% at 6,225.

The overall breadth is negative as 1,496 stocks are declining while 1,039 stocks are advancing.