Markets lose momentum, currently directionless

As we mentioned in our morning update, the markets opened in the green, but lost the momentum immediately. The Sensex is currently trading marginally down by 0.05% at 17561.48, indicating another volatile day ahead.

The Asian markets are also showing volatility in their trades. The Nikkei and Hang Seng are up by 0.79% and 1.58% respectively, while Shanghai is down by 0.35% as of now. Yesterday, the Italian Prime Minister, Silvio Berlusconi, offered to resign after the country’s Parliament approved a budget that includes reforms demanded by the European countries. Italy is the key country to watch now, as Europe is already facing the risk caused by the debt crisis in Greece.

Back home, among the sectoral indices, Oil & Gas, Realty, Healthcare, PSU, Capital Goods, and Bankex are trading in the green, while the other indices are seen trading in the red. Hindustan Unilever has gained 1.43% so far, and is the major gainer among the Sensex stocks. Metal stocks such as Tata Steel and Jindal Steel are also seen trading in the positive. In the IT space, Wipro is trading up by over 1%, while TCS and Infosys are trading marginally up. BHEL is trading flat this morning, even though there is news that it will sign a Rs 2000 cr agreement with RNRL to set up a tube mill at Vizag. Realty major DLF is down by over 1%, after it was asked to pay Rs 630 cr for the abuse of its dominant market position. As we expected in our morning update, RIL and IDFC are seen trading marginally up, and are in the green.

Reliance Infra and Reliance Power are both trading up, after they announced their quarterly results yesterday

The market breadth, which indicates the overall health of the market, is positive. On the BSE, 1334 shares rose, 1160 shares fell, and 89 shares remained unchanged.

Today, Adani Power, Britannia Industries, HDIL, Shree Renuka Sugars, Tata Chemicals, Great Eastern Shipping, REI Agro, Jet Airways, etc. will post their Q2 FY12 earnings.

Going ahead, we expect volatility in the Indian market. There may some push as the European markets open, however, it seems directionless at the moment.