Markets Hold Their Morning Gains, Auto Index Continues To Slide

The Indian markets are holding their morning gains, with both the broader indices trading higher by almost 0.60%. This may be on the back of speculations that the US Fed could take some steps to boost growth in the economy, which is showing signs of moderating. Among the sectoral indices, IT, Teck and Realty are trading higher by more than 1%, while FMCG and Healthcare are trading down by 0.16% and 0.46% respectively.

Other Asian markets are trading with mixed fare, with the Hang Seng trading higher 1.43% and Shanghai trading down by 0.35%. This is on the back of speculations that the corporate earnings would beat the street estimates, coupled with improved confidence among the South Korean manufacturers. There was also talk that Australia’s central bank will cut the interest rates in its meet tomorrow. The Nikkei market is closed for the day.

The European markets have also opened on a positive note, with the CAC, DAX and FTSE trading higher in the green zone. As per the media reports, this is due to the fact that the Spanish economy has shrunk less that what was forecasted by the street, creating hopes that the Euro zone will recover sooner or later.

Back home, Realty heavyweight DLF is the leading index gainer, up 3.4% at Rs 188.35. IT stocks are trading higher due to the weakening rupee. Infosys and TCS are trading higher by 2.49% and 3.04% respectively. Banking stocks are also trading in gains, with SBI and ICICI Bank up 1.08% and 1.57% respectively. Other stocks like HDFC Bank, Coal India, Tata Motors, HDFC, etc. are trading marginally in the green zone.

On the other hand, the Auto stocks continue to slide. Maruti Suzuki and Mahindra & Mahindra are trading lower by 2.26% and 1.13% respectively. Other losing stocks include BHEL, Sun Pharma, HDFC Bank, Wipro, ITC, etc.

Bank of India is trading 4.52% higher at Rs 352.60 after reporting robust Mar 2012 quarter numbers. Its net profit increased by 93% to Rs 953 crore on a YoY basis. Godrej Consumer Products has made a new high, and is trading 1.6% higher at Rs 535. This is after the Mar 2012 quarter consolidated profits grew by 36% to Rs 193 crore on the back of strong topline growth.

The market breadth, which indicates the overall health of the market, is strong. On the BSE, 1401 shares gained, 1165 shares declined and 96 shares remained unchanged.

We expect the markets to remain volatile, and advise readers to play with caution.