Markets Moving In Narrow Range

As expected in our morning update, the Indian markets opened in the positive territory but quickly gave up all their gains. At present, both the indices are trading in a very narrow zone, with the Sensex down by 42 points to 17179 and Nifty down by 10 points to 5224 points. After seeing a free fall in yesterday’s trading session, the markets may stabilise in today’s session as there could be some buying opportunities in some of the stocks. Among the sectors, Oil & Gas, Power, Metals etc. are trading on the weaker side, while Realty, FMCG, IT, etc. have moved higher.

Other Asian markets are trading in a mixed bag, with Hang Seng and Shanghai down around 1%. Nikkei is recovering some of the losses from yesterday, trading higher by 0.30%. As per the media reports, the Japanese market traded higher as the Yen dropped from its one-month high against the dollar, which further boosted the outlook for exporters. The Chinese market is trading on a weaker note, as the trade data has created speculations on the slowing down of the Chinese economy.

Back home, GAIL India is the leading index loser, down 3.52% to Rs 350.35. Auto stocks like Hero MotoCorp, Maruti Suzuki and Bajaj Auto are trading on a weaker note. Further, stocks like ONGC, BHEL, Tata Steel, HDFC Bank, Coal India, etc. are trading in the lower zone, down 0.74%-1.38%. On the other hand, IT stocks are trading higher on the back of expectations that with the rupee depreciation, their March 2012 quarter results may come on a positive note. Stocks like Wipro and Infosys are trading higher by 1.35% and 0.11% respectively. FMCG stocks, which are considered defensive bets, are trading higher with stocks like HUL and ITC up by 1.21% and 0.42% respectively.

McNally Bharat Engineering is up 2.58% to Rs 99.50 after the news that it has received a Rs 150 crore order from Bhushan Power and Steel. Further, HUL has made an announcement that it is going to post its March 2012 quarter results on May 1. IT major, TCS, is going to announce its results on April 23, while Infosys will announce on April 13. Investors should watch out for their management guidance, which will further give outlook for the sector as well as for the company.

The market breadth, which indicates the overall health of the market, is strong. On the BSE, 942 shares rose and 746 shares declined. 106 shares remained unchanged.

We expect the market to remain volatile for the day.