Markets End Flat, Auto Gains 1.04%

The Indian markets traded flattish throughout the day. Trading took place mostly around Friday’s closing of 18309.37 on the Sensex and 5574.05 on Nifty, with occasional ups and downs around these levels. The lacklustre trading came to an end with the Sensex closing higher by 29.63 points or 0.16% at 18339 and Nifty closing lower by 2.65 points or 0.05% at 5571.40.

The automobile sector went higher due to a steep rise in the share price of Maruti Suzuki (MSIL), which saw an upward movement of 3.63%. Mahindra & Mahindra and Bajaj Auto too saw some strength, closing up by 1.60% and 2.23% respectively. This rise was on account of the positive sentiment around these companies resulting from strong festive season sales volumes. Moreover, MSIL has been in the news for its move to export completely knocked down (CKD) kits for assembly to Asia to increase export volumes in an bid to counter the negative exposure of the fluctuating Yen.

NTPC gained 1.11% on account of the company commissioning Unit 5 of 500 MW of its Rihand Super Thermal Power Station.

The broader indices saw support due to a rise in individual stocks, ignoring the inherent weakness in the markets today.

While the broader indices saw minute movement, the BSE midcap and smallcap indices were significantly weak, with losses of 0.89% and 0.85% respectively. The overall market breadth too was negative, with 1061 advances (35.74%) and 1767 declines (59.51%). Of the 13 sectoral indices, only 4 ended the day positive. The gains were led by the Auto and Bankex indices, which closed higher by 1.04% and 0.87% respectively. Realty and Teck were pretty much flat, with nominal gains of 0.02% and 0.06% respectively.

While the Indian stocks remained flat, the Shanghai index saw a drop of 0.65% by day's end, while Nikkei moved upwards by 3.66%. Chinese stocks were dragged lower by real estate companies, which went low. This was due to data indicating that average prices remained unchanged in Oct 2012 from the preceding month, signifying that the sector may not ease any time soon. Japan, however, has been on an upward path due to a weakening Yen and hopes of the government bringing in easing measures through its monetary policy.

Europe saw a strong opening today, and the DAX and CAC have been trading higher by 1.33% each. This has been on the back of progress in the US debt negotiations. The Congress leaders recently expressed their optimism over a deal being struck to order the fiscal cliff. This eased the worries that markets worldwide had been gripped by.

Led by positive global cues, we expect the US markets to be upbeat. This would also increase the likelihood of an upswing in the Indian markets tomorrow.