Slow & Steady Recovery For Markets

The Indian markets saw a slow and steady recovery throughout the day, finally closing in the positive territory. The broader indices closed about 0.14% higher. This was after investors were tempted to buy some of the stocks that were beaten down heavily in the past few trading sessions. Among the sectoral indices, surprisingly, the defensive bets moved southwards even when the markets showed some strength. The Consumer Durables and FMCG indices closed down by 1.48% and 3% respectively. Capital Goods, Realty, Bankex and Oil & Gas, on the other hand, all closed the day up more than 1%.

The peer Asian markets also closed the day in the red. The three major indices, Hang Seng, Nikkei and Shanghai closed lower in the range of 1.71%-3%. China’s services sector, which is expanding at its weakest pace in more than a year, is dampening hopes of cutting some of the manufacturing industries' slack.

European indices showed some strength after opening in the deep red. CAC has turned into positive the zone, while FTSE and DAX have also recovered from their day’s lows.

Dow Jones Futures is currently trading 54 points or 0.44% down at 12049, indicating a negative sentiment in the US markets.

Back home, Capital Goods heavyweight L&T was the leading index gainer and closed the day up by 3.43% at Rs 1173.4. It was one of the stocks that pulled the broader indices up for a close in the green zone. ONGC closed higher 3.19% at Rs 254.15. Tata Motors was also picked up by investors after being beaten down in the past few trading sessions. The stocks today closed 1.89% higher at Rs 228.75. Other stocks like DLF, RIL, Tata Steel, Hero MotoCorp closed the day up more than 1% each.

GAIL India was the leading index loser, down 3.47% at Rs 319.50. FMCG heavyweights HUL and ITC closed the day lower by 1.55% and 1.54% respectively. Other stocks like Jindal Steel, Tata Power, Bharti Airtel and Sterlite Industries closed the day down more than 2% each. Coal India, Bajaj Auto and Maruti Suzuki also ended lower, marginally in the red zone.

Future Capital Holdings is trading higher by 4.78% at Rs 143.55 on news of a majority holding purchase by US private equity firm Warburg Pincus LLC $100-$125 million.

However, the market breadth, which indicates the overall health of the market, was negative for the day. Out of the 3104 stocks traded on the BSE, 1606 declined, 1373 advanced and 125 remained unchanged.

In conclusion we expect the markets to remain volatile for tomorrow and advise our readers to play with caution.