Markets Down On Trading Error, Cairn Q4 Earnings Lower By 11%

After a flat start to the day, the Indian markets a moved lower by closing time. Both the key indices were down by over 0.7%. A huge fall was seen in the markets between 2-2:30 pm, mainly due to a trading error in the Nifty futures. The National Stock Exchange would investigate the matter and come up with an explanation. The heavyweight, RIL, lost 1.39% on expectations of a weak result for the Mar 2012 quarter.

The global cues remained negative. Where the Asian indices remained range bound, a flat opening was seen in the European indices. The latter have now recovered, and are trading with marginal gains. Dow Jones Futures is currently trading with gains of 0.45%, indicating a positive sentiment.

Meanwhile, Barclays has said that the RBI will cut the rates by 150 basis points in this fiscal. SBI will be cutting its auto loan rates by 50 bps, while ICICI Bank, IDBI Bank and PNB have already gone ahead with a rate cut.

The rupee went further down by 0.09% today to touch 52.09, increasing the worries of the corporate sector.

Back home, only the FMCG and Auto indices remained in the green zone, while all the other sectoral indices closed in the red. CD, which was up by nearly 1% in the morning, lost all its gains and was down by 0.05% by the end of the day. CG stocks closed with 1.84% losses on renewed worries of margin pressures as well as the Chinese competition. Power was also down by 1.72%, as Coal India is missing all the deadlines for signing the FSAs. The PSU index was down, as most PSU stocks declined in value. The Oil & Gas index was pulled down by RIL, which is due to announce its financial performance for the Mar 2012 quarter. The street expects a decline in the company's net profits due to lower production in the KG-D6 basin as well as lower Gross Refining Margins.

Among individual stocks, Mahindra & Mahindra, Maruti Suzuki and Ashok Leyland were up, as auto loans are set to get cheaper.

Cairn India has come out with its Mar 2012 quarter result, where its revenues have remained almost flat and its earnings have declined by 11%. The aftermarket result would drag its shares on Monday.

Bluechip Tex Industries, Vijaya Bank and Hindoostan Mills have reported to the stock exchange that a board meeting will be held to consider the quarterly results with the possibility of recommending dividend (if any).

Among the ‘A’ group stocks, Gitanjali Gems and HPCL were up by 2% each. Ashok Leyland, TTK Prestige, United Spirits, Marico, etc. managed to remain positive by the end of the day. Stocks such as Jain Irrigation, National Aluminum, Adani Enterprises, Muthoot Finance, etc. lost over 4% each by closing time.

High volumes were seen in JK Cement, Symphony, Omkar Specialty, State Bank of Bikaner, Muthoot Finance and Claris Lifesciences.

The market sentiment, which was positive in the morning, changed to negative by the close of day.

With the rate cut, the markets have gained about 2% in the week. The earnings season has started, and the markets may turn volatile in the next week. Besides, RIL’s result would possibly drag the markets down on Monday.