Markets recover in later trades

Shrikant / 22 Dec 2011

The Indian markets, which opened on a negative note and traded with a downward trend for two-thirds of the day, recovered sharply in the later afternoon trades and sprinted high into the green zone.

The Indian markets, which opened on a negative note and traded with a downward trend for two-thirds of the day, recovered sharply in the later afternoon trades and sprinted into the green zone.

The sentiment improved after the finalisation of the Finance Minister's new strategy to meet the fiscal deficit target. Meanwhile, food inflation fell sharply to a 4-year low of 1.81% for the week ended Dec 10, 2011. The prices of vegetables, onions, potatoes and wheat declined.

Asian markets remained subdued for the whole day, and traded with losses between 0.3%-1%.

On the other hand, the European markets are trading firm in positives at the moment. FTSE, CAC and DAX are up by over 1% each.

Dow Jones Futures is currently trading 50 points or 0.42% up at 12074, indicating a positive sentiment in the US markets.

Benchmark Indices
Index Closing % Change
Sensex 15,813.36 0.82%
Nifty 4,733.85 0.87%
Hang Seng 18,378.23 -0.21%
Nikkei 8,395.16 -0.77%
Shanghai 2,186.30 -0.22%
Live
FTSE 5,449.77 1.11%
CAC 3,070.08 1.31%
DAX 5,853.21 1.07%

On the domestic front, almost all the sectors gave up the initial bears and turned into the green by the day's end. The IT and Teck indices largely underperformed due to the negative sentiment created by the weak earnings numbers put in by software major Oracle Corp in the US.

Sectoral Indices
Index Close Change(Pts) Change (%)
Broad
MIDCAP 5182.04 40.75 0.79
SMLCAP 5556.28 39.43 0.71
BSE-100 8110.89 71.56 0.89
BSE-200 1892.3 17.1 0.91
BSE-500 5896.96 50.97 0.87
Sectors      
REALTY 1428.05 42.37 3.06
POWER 1816.62 36.14 2.03
BANKEX 9607.39 190.98 2.03
CD 5399.46 107.18 2.03
PSU 6465.68 111.59 1.76
AUTO 8271.51 142.71 1.76
CG 8132.81 119.77 1.49
OIL&GAS 8035.84 110.35 1.39
FMCG 4077.02 39.66 0.98
HC 5872.16 31.16 0.53
METAL 9549.22 28.02 0.29
TECk 3331.27 -44.84 -1.33
IT 5662.72 -86.73 -1.51

Among the 30 Sensex stocks, at one time only 3 companies were seen trading with some gains. By the end of the day though, the number  of companies with gains increased to 24. DLF led the gainers list with 4.80% returns. Tata Motors and ICICI Bank were also up by over 3%. On the other hand, Wipro, Bharti Airtel, Infosys, Coal India, TCS and Hindalco Industries all remained in the negatives at the time of closing.

Of the other stocks, Goenka Diamond and Apple Finance both clocked in 19% returns. Hindustan Copper, Jaypee Infratech, MMTC and Ashok Leyland also put in double digit returns by the end of the day.

In other announcements, Strides Arcolab has received USFDA approval for another product in its sterile products division, and the scrip was up by over 3%. Ranbaxy Laboratories was also up by 3.59%. According to a news article, GVK Power & Infrastructure is planning to sell a minority holding in GVK Hancock with the aim of raising funds to retire a part of its debt and fund operations. The stock closed with a marginal upside.

Advance-Decline Table
Index Advances Declines Unchanged
BSE 30 22 8 0
BSE 100 70 29 1
BSE 200 143 56 1
BSE 500 321 173 6
Others 1231 999 109

The overall market breadth, which remained negative for most of the day, improved significantly in the later sessions. Out of a total of 3197 stocks traded on the BSE, 1787 stocks advanced and 1265 stocks declined, while 117 stocks remained unchanged.

The markets showed quick recovery in the later session today. Yesterday too, the markets had gained over 300 points in the late afternoon trades. With the inflation number coming down, the street is expecting a rate cut in the next RBI meet. Investors should keep track of these macro elements, which will give them vital cues ahead for trading.

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