Markets continue to trade flat

Indian stock markets have given up their early morning gains and continue to trade on a flat note with both the bourses down by 0.7% each. A drop in auto sales numbers (Two wheelers) dragged the markets down in the afternoon trade. Also, a negative global environment and the slowdown in the economy has undermined the mood of investors.

The European markets CAC and DAX have opened on a positive note with marginal gains after having a few negative sessions over concerns about the European debt crisis. The benchmark index FTSE is closed today.

As most of the world markets will remain closed today, there won’t be many global clues and it will be hard to pinpoint any direction in the absence of strong leads.
 
Back home, the Consumer Durables, IT, Tech and Oil & Gas and PSU sectoral indices are trading with marginal gains of under a per cent. While all other indices are trading in the negative territory, with losses between 0-1% each. Auto index remains the top loser and is down with 1.71%.

In Sensex, Coal India is leading the index with gains of 3% on back of news that it has entered into a new coal price regime effective from today onwards. While Bajaj auto remains the top loser with a loss of 8% due to lower sales data in December 2011. DLF is also down by 3% as Crisil downgrads its short term and long term credit rating.

Most of the shares on the 30-share index are trading on a negative note. Companies like HDFC Bank, Hero Motorcorp, Hindalco Inds, Sun Pharma and BHEL are trading with losses of 1-2% each.

The other Sensex gainers like Bharti Airtel, Cipla, ICICI Bank, Maruti Suzuki, Sterlite Tata Motors, Tata Steel and TCS are trading with marginal gains between 0.5-2% each.

The market breadth, indicating the overall health of the market, is weak. On BSE, 1208 shares declined and 1220 shares fell. A total of 126 shares remained unchanged.

In conclusion, we expect the markets to remain flat for the rest of the day and advise readers to play with cautious.