Range-Bound Markets End Flat

The Indian markets remained lifeless through the entire day. There have been no drastic moves or stimulus to provide the market a reason to move. The markets have remained range-bound and have been drifting between 17825 and 17910, which is a tight range indeed. The day ended with the Nifty holding the 5400 level. The Sensex closed 38.40 points lower at 17846.86, down by 0.21%, while Nifty closed 8.15 points lower at 5412.85, down by 0.15%.

The European markets saw some broad selling as investors got edgy ahead of the meeting between the Greek Prime Minister Antonis Samaras and the Eurogroup chief Jean-Claude Juncker which is scheduled to be held later today. The Greek Prime Minister is also scheduled to meet the German Chancellor Angela Merkel on Friday. Reports say that Samaras has been looking to ask for more time to implement austerity measures. The European indices have been trading significantly lower, with the FTSE, DAX and CAC lower by 1.03%, 0.76% and 0.68% respectively.

The Asian markets ended lower today on account of the Japanese trade figures and following mining giant BHP Billiton’s first decline in annual profit in three years. The Japanese trade data pushed all Asian stocks lower today and also had an effect on European stocks. The Hang Seng, Nikkei and Shanghai Composite ended lower today by 1.06%, 0.27% and 0.5% respectively. What investors are now looking forward to is the Chinese preliminary PMI for August, which will be out tomorrow. Investors are not expecting these figures to be very good since past data and Japanese trade data have been severely low.

Oil, on the other hand, extended gains because of a larger-than-expected drop in the US crude supplies. American Petroleum Institute’s weekly review report indicated a 6 million barrel drop in crude supplies last year.

Among the sectors, Healthcare, Auto and IT remained high throughout the day. Ranbaxy, Strides Arcolab and Cadilla were among the heavy gainers in Healthcare. In Auto, Bajaj Auto and Hero MotoCorp saw some heavy buying, with the stocks rising by more than 2% during the day. Bajaj Auto ended the day higher by 0.79% and Hero MotoCorp ended higher by 0.85%. Among IT companies, the midcap companies rose significantly, while Infosys saw gains coming in from the case dismissal in the Alabama district court and TCS from its acquisition of Pune-based CRL. Tyre stocks too have been seeing major upswings due to the relaxation of the international rubber prices.

Among the ones that saw losses was Bharti Airtel which fell by 3.85% after the downgrade by Credit Suisse.

For tomorrow, we feel the market direction will be dominated by global cues. Things to look forward to for tomorrow include reports on today’s meeting between the Greek Prime Minister and the Eurogroup chief and the preliminary PMI data for China by London-based Markit Economics. This will define the direction for the Indian markets tomorrow.