Day's Trades End Negative, Rupee Breaches 56 Mark

The Indian markets witnessed a negative trading session after both the broader indices closed the day lower by 0.50%. The markets tried to recover around noon, but could not do so completely after the European markets opened with deep cuts. Among the sectors, Consumer Durables was the biggest loser, down by over 2%. Other indices include Capital Goods, Realty, Metals, Auto, etc., which closed in the red. Only two indices, IT and HC, closed the day marginally in the green zone.

The rupee's fall against the dollar continues. It is currently trading at 56.13, depreciating 1.34% against the USD and has breached the 56 mark. Now, the general street expectation is that the rupee will depreciate further and reach the 57 mark soon.

In the other Asian markets, Hang Seng, Nikkei and Shanghai closed the day lower in the range of 0.40%-2%. The Japanese market closed down by almost 2% after the ratings agency Fitch downgraded the nation's credit rating. Further disappointment was also seen from the nation’s trade data and on expectations that the Euro crisis may get worse going ahead.

European markets also are currently trading weak with deep cuts. The CAC, DAX and FTSE are currently down by almost 2%. Investors are awaiting the outcome of the European Union's summit on the back of fears that Greece would probably exit from the Euro.

Dow Jones Futures is currently trading 82 points or 0.65% down at 12395, indicating a negative sentiment in the US markets.

Back home, Bharti Airtel was the leading index loser, down 4.29% to Rs 281.95. Tata Power continued yesterday's losses, closing down by 2% to Rs 88.65 after reporting dismal Mar 2012 quarter numbers. Metals stocks like Jindal Steel and Sterlite Industries closed down by 1.84% and 1.51% respectively. Auto stocks like Bajaj Auto, Tata Motors closed lower in the negative territory. Others like Maruti Suzuki, NTPC, HDFC Bank, ITC, etc. closed the day marginally in the red zone.

On the other hand, GAIL India was the leading index gainer and closed up 3.19% at Rs 323.95 on reports that India is to sign an agreement to buy natural gas from Turkmenisatan. The IT pack saw some buying as investors expect the companies in the sector to perform better on the back of rupee depreciation. Stocks like Wipro, Infosys and TCS closed higher in the green zone. HUL, BHEL, Coal India, SBI, etc. were some of the names that closed the day positive.

Wockhardt closed the day at a lifetime high, up 12.66% to Rs 808.60 after the company's operating margin improved approximately by 600 bps to 35% in the Mar quarter. Jet Airways closed 4.09% higher at Rs 321.95 following media reports that said that the company is likely to order 100 planes for USD 3.75 billion.

The market breadth, which indicates the overall health of the market, was negative. Out of the 3157 stocks traded on the BSE, 1843 declined, 1200 advanced and 114 remained unchanged.

One should watch out for stocks like Gujarat State Petronet, Jai Corp, Jet Air India, Madras Cement, Max India, Reliance Power, Pidilite Industries, TVS Motors and Voltas that are going to post their Q4FY12 results next week. These stocks may see a price movement.

In conclusion we expect the markets to remain volatile tomorrow as investors are jittery in this uncertain environment. We advise investors to play with caution.