The market will remain directionless until the election results are clear
After a relentless rally, market finally seem to be pausing for breath and some serious profit booking from the very start of trading today. Stock indices struggled to stay in the green without any success and the downtrend was visible all through the session.
Sensex opened at 23,898 while the Nifty opened at 7,112. The indices lost strength after hitting a high of 23,965 and 7,142 and edged lower to hit a low of 23,753 and 7,081.
Sensex closed at 23,815 (down 56 points or 0.24%) while Nifty closed flat at 7,109. The NSE recorded a volume of 117.36 crore shares. India VIX rose 1.16% to close at 32.4200.
The top five gainers among the other indices on the NSE were Realty (4.22%), P S U Bank (3.32%), Metal (3.27%), Nifty Midcap 50 (2.56%) and Dividend Opportunities (2.18%) while the top five losers were Energy (0.73%), Pharma (0.43%), Finance (0.33%), I T (0.16%) and Auto (0.08%).
Of the 50 stocks on the Nifty, 30 ended in the green. The top five gainers were Bank of Baroda (9.60%), Jindal Steel (6.51%), Tata Steel (5.95%), DLF (5.45%) and NMDC (5.07%). The top five losers were M & M (3.67%), Dr Reddy (3.48%), HDFC (1.91%), Reliance Industries (1.74%) and HDFC Bank (1.71%).
Of the 1,572 companies trading on the NSE, 958 companies closed in the green, 537 companies closed in the red while 77 companies closed flat.
Tata Steel (5.91%), top gainer among Sensex 30 pack, was in news for its plans to raise $1.24 billion overseas through the sale of bonds. This is part of a mega $7 billion debt refinancing initiative for Tata Steel Europe, formerly known as Corus.
After posting weak consolidated net profit Dr Reddy’s Lab was the top loser in the Sensex 30 stock for the second consecutive session. Bank of America-Merrill Lynch downgraded the stock to "underperform" from "buy," and Morgan Stanley too downgraded it to "equalweight" from "overweight". Dr Reddy’s Lab fell 3.51%.
Indian Bank recently came out with a weak quarterly result and annual result. However it was the top gainer in ‘A’ group on the BSE, rising 11.73%.
Bajaj Finance was the top loser in the ‘A’ group on the BSE, falling 4.35%, despite better results.
Bank stocks will be in focus in the coming days as a committee appointed by the Reserve Bank of India (RBI) under Dr P J Nayak has reportedly proposed that the government should cut its stakes in state banks to below 50% and establish "fully empowered" bank boards. This has already triggered angry protests from bank unions. The All India Bank Employees Association has issued a strong letter of protest and has threatened country-wide protests, rallies and agitations. The news moved the banking stocks higher. The stocks which came among the top 10 gainers in the ‘A’ group on the BSE were Indian Bank (11.73%), Canara Bank (10.68%), Central Bank of India (10.37%), BOB (9.22%), Union Bank (8.92%), Bank of India (8.21%) and IOB (8.17%).
US indices closed flat on Tuesday. US retail sales increased 0.1% in April following a revised 1.5% jump in March that marked the biggest gain in four years, Commerce Department figures showed in Washington.
Except for Shanghai Composite (0.14%) and Nikkei 225 (0.14%) all the other Asian indices closed in the green. Jakarta Composite (1.43%) was the top gainer.
China's central bank called on the nation's biggest lenders to accelerate the granting of mortgages. The People's Bank of China told 15 banks yesterday to “improve efficiency of service, give timely approval and distribution of mortgages to qualified buyers”. It also urged lenders to give priority to families buying their first homes and strengthen their monitoring of credit risks.
European indices were trading marginally lower as were US Futures.