Markets Give Up Morning Gains

The Indian markets have given up their morning gains and are trading in the red zone, with the Sensex and Nifty both down by 0.35%. Nifty is still trading below the 4900 levels, while the Sensex is holding the 16100 levels. The rupee has depreciated further, and is trading at around 55 per dollar, worsening the economic scenario of the country. Among the sectoral indices, Realty, FMCG, Capital Goods and Healthcare are trading lower, while IT and Teck are trading higher by around 0.50%.

On the other hand, the other Asian markets, viz. Hang Seng, Nikkei and Shanghai are trading higher by more than 1% each. This is on the back of news that the Chinese government will take some stance which will help the economy to grow. The Chinese economy is one of the largest, and hence an upheaval has also helped the Euro markets to open in the positive zone. European indices like the CAC, DAX and FTSE are trading higher in the range of 0.64%-1%.

Back home, Tata Power is the leading index loser, down 3.19% to Rs 92.45. This is on the back of investor speculations that the company's Mar 2012 quarter results may not be good. Metals stocks like Hindalco and Sterlite Industries are trading lower by 1.36% and 1.9% respectively. SBI is witnessing some profit booking after two days’ gains of around 8%-10%. Today, the scrip is trading 0.67% lower at Rs 1994. FMCG majors ITC and HUL are also trading lower by 1.08% and 0.64% respectively.

On the other hand, Capital Goods heavyweight, BHEL, has extended yesterday’s gains and is trading 2.25% higher at Rs 211.10. Other stocks like Tata Motors and TCS are trading higher by 2.16% and 1.12% respectively. HDFC, NTPC, Infosys, Jindal Steel, etc. are trading marginally in the green zone.

Kalpataru Power Transmission is trading 3.3% lower at Rs 82.10 after reporting dismal A4 numbers. On a consolidated basis, the company's net profit fell 3.3% to Rs 204 crore even when the revenue increased by 22% to Rs 5308 crore. Oil marketing companies like BPCL, HPCL and IOC are trading higher in the range of 0.3%-0.7% on the back of speculations that petrol prices may be hiked soon.

The market breadth, which indicates the overall health of the market, is weak. On the BSE, 1233 shares declined, 1158 shares gained and 144 shares remained unchanged.

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