Markets Trading Flat, Maruti Suzuki Down 3%

The Indian markets have beaten all expectations to open flat today. The high uncertainity over the rate cut is weighing down the markets. Over the past few days, volatility has been high and persistent. The current advance-decline ratio is also mixed, providing no clue as to whether the markets will post gains or losses. It seems that the markets will remain range-bound in the course of the day.

On the sectoral front, the Realty index is up 2% at this hour. Other interest rate-sensitive indices such as Bankex and Auto are also outperforming the broader indices. The Capital Goods index has gained nearly 2% today after yesterday’s dismal IIP numbers. The HC index is trading in negatives for the second consecutive day.

After the initial volatility, the Asian indices are showing some firm gains at this moment. Nikkei and Hang Seng are up 0.7% and 0.8% respectively, and Hang Seng has also surged by 0.37%. However, due to the initial volatility, it cannot be said firmly that the indices will hold their gains.

Meanwhile, the mood on the street seems optimistic, as brokerage houses and analysts are now seeing the Nifty touching 5200 in a few days. Religare Capital has said that the 50 bps rate cut would take the Nifty to the 5250 levels. Of course, the rupee hovering near the 56 mark still remains a market worry.

Among the Sensex stocks, HUL is the top gainer with 1.7% gains. Jindal Steel is up 1.5% after it announced its production numbers yesterday. Coal India, Sun Pharma, Bharti Airtel and BHEL are also up by 1% each. On the other hand, the shares of Maruti Suzuki are down by 3% over the proposed merger with Suzuki Powertrain. M&M and Sterlite are also down 1.7% each.

IT giant Wipro is up by 1% after the company said to analysts that it still has a cautious approach, as decision making at the customer end is still slow. A few brokerage houses have recommended a 'buy' call on the scrip.

Among the other stocks, United Breweries and United Spirits are up by nearly 5% each. JP Infratech and Reliance Communications are also seeing some good buys.

Suzlon Energy has gained 0.85% today after witnessing volatility yesterday. The newspaper Mint has said that Suzlon has no option but to sell its German arm, RePower. The company has recently got a 45-day extention from its bondholders, but it may need to raise funds either through asset sales or by raising more debt. Risks like these are reflected in the scrip, and we believe that it may tank further in the coming days.

Ahead in the day, the markets are expected to remain range-bound with high volatility.