Weekly: Markets end tad down amid weak global cues

M&M top weekly gainer among the Sensex stocks

Indian stocks ended marginally lower in the week to October 27, amid weak global cues, as investors booked profits in defensive shares after recent gains.

The 30-share Sensex ended down 57 points or 0.30% at 18,625 while the 50-share S&P CNX Nifty slipped 20 points or 0.35% to close at 5,664.

However, the impact of selling pressure was more prominent in the broader markets with both the Mid-cap and Small-cap indices down over 1% in the week under review.

Foreign Institutional Investors have been net buyers of equities in the Indian market.They have bought equities worth $18.15 billion (Rs 94,337 crore) in calendar year 2012 so far.

Among the sectoral indices on the BSE, the Consumer Durables index was the top loser down 4.3% followed by FMCG, Realty, Power and Metal down 1.4-3% each.

FMCG major ITC ended down 3.9% despite better-than-expected second quarter earnings after The Ministry of Health and Family Welfare early this week notified new set of health warnings to be displayed on tobacco product packs effective from April next year.

Hindustan Unilever ended down 2.6% on concerns of lower volume growth and budget realisation in the Canteen Stores Department.

Hindustan Unilever on Friday reported a 17% growth in net profit for the quarter ended September 30, 2012 to Rs 806.92 crore from Rs 688.92 crore a year ago. But the slowdown in discretionary spends appeared to have taken its toll on the company with topline growth at 12% to Rs 6,155.41 crore from 5,516 crore a year ago. Underlying volume growth - which has hovered in the 9-10% zone in the last few quarters - was 7% for the quarter under review.

Pharma majors witnessed profit taking after recent gains. Dr Reddy's Labs was the top loser down 1.9% followed by Sun Pharma and Cipla.

Software majors Wipro and Infosys ended down over 2% each as the appreciating rupee against the US dollar would continue to hurt revenues. Both companies earn most of their revenues from exports to the US. The rupee has been appreciating against the dollar on the back of foreign fund inflows into Indian equities.

India's largest lender SBI ended down 3.7%. The stock has remained subdued on account of asset quality concerns.

Tata Motors ended down 2.8% as slowdown in global sales continued to weigh on the stock. The company in mid-October said, sales including that of Jaguar Land Rover (JLR), declined by 4.5% at 103,656 vehicles in September 2012 from the year-ago period.

In the metal pack, Jindal Steel was the top Sensex loser down 5.2% followed by Tata Steel and Hindalco.

Mahindra & Mahindra ended was the top Sensex gainer which ended up 6.8%. Utility vehicle and tractor segment market leader Mahindra & Mahindra posted an estimate-beating net profit rise of 22 per cent in the second quarter, driven by surging demand for diesel-driven SUVs. The Mumbai-based company posted a net profit of Rs 902 crore during the quarter ended September 30, as against a net profit of Rs 737 crore in the same quarter a year before.

Engineering major L&T ended up 4.5% on reporting a better-than-expected 42% year-on-year (yoy) growth in net profit at Rs 1,137 crore in the quarter ended September 2012 due to Rs 267 crore extra-ordinary gain. Analysts on an average had estimated profit of Rs 877 crore from engineering giant. Net sales grew 17% at Rs 13,195 crore.

India's largest private banker ICICI Bank ended up 2.1%. The banker breezed past street estimates with better-than-expected earnings as standalone net profit for the quarter ended September 30, 2012 climbed 30% from a year earlier to Rs 1,956 crore. Higher interest income, stable net interest margin, dividend income from subsidiaries, and better cost management aided the bank's earnings during the quarter. Analysts were expecting the bank to report around 22% growth in profit after tax.

Two wheeler major Hero MotoCorp ended up 1.1% despite weak second quarter earnings after the management said that retail sales during the festival of Navratri had topped 2 lakh units. Net profit for the September quarter dropped 27% to Rs 441 crore on 11% fall in net sales to Rs 5151 crore. Meanwhile, Mumbai based investment advisory IiAS has asked investors, to give a go ahead for the merger between Hero MotoCorp Ltd (HMCL), country's largest two-wheeler maker by sales, and Hero Investments Pvt Ltd (HIPL). Investors are set to vote on merger on November 2.

Investors will continue to focus on second quarter earnings and Reserve Bank of India's policy stance at its second quarter monetary policy review on Tuesday.