Trades In Narrow Range; US Markets Eyed

The Indian markets are trading in a very narrow range as of now. This is after yesterday's disappointment on the rate cut front, following which they were down by over 1%. The RBI maintained status quo on to key repo rate once again, but slashed the CRR by 25 basis points to 4.25% effective from Nov 3, 2012. At present, the Nifty is hovering around the psychological 5600 mark.

Among the sectoral indices, Capital Goods, Oil & Gas and Power are trading lower in the negative territory. On the other hand, Healthcare is trading smartly up by more than 1%. Other indices like Auto, Consumer Durables and IT are also in positives.

The global markets participants are waiting to take cues from the US markets, which are expected to resume their trades from today. The US stock exchanges were off for two days after being was badly impacted by Sandy, the worst hurricane in nearly 75 years. It was the first time in 27 years that the exchanges closed because of bad weather. Reports say that after two days of closure that occurred during the busy corporate earnings season and at the end of the fiscal year for certain funds, trading is likely to be volatile.

Other Asian markets are trading in gains, with the Hang Seng, Nikkei and Shanghai are higher in the range of 0.1%-1%. This is said to be after economic data from South Korea to Taiwan signaled that the global slowdown may be easing. South Korea's Won index touched a 13-month high, while Metals rallied before the US equity markets reopen today.

Back home, ONGC is the leading index loser, trading lower by 1.89% at Rs 267.85 per share. Other stocks like GAIL India, HUL, BHEL, Jindal Steel and L&T have lost more than 1% each. TCS, ITC, RIL, etc. are marginally in the red zone.

On the flip side, Maruti Suzuki is the leading index gainer, up 2.86% at Rs 1434 per share. Other Auto stocks like M&M, Tata Motors, Hero MotoCorp and Bajaj Auto are also higher in the range of 0.50%-1.1% ahead of their Oct sales numbers which are expected to see a rise on account of the festive season. IT stocks like Wipro and Infosys are also in gains on the back of speculations that the rupee could depreciate further to the levels of Rs 56-57 per USD. Others like ICICI Bank, SBI, HDFC, Tata Power, Hindalco, etc are. also trading positive.

The market breadth is slightly on the weaker end. On the BSE, 1317 shares have declined, 1134 shares have advanced and 137 shares are unchanged.

We expect the markets to remain in narrow range with a negative bias for the latter part of the day.