Nifty may move in the range of 4,935 and 5,125

Weak global cues and poor quarterly results from domestic companies resulted in the market snapping its three-day winning streak. The Sensex and the Nifty saw their steepest one-day fall of 2.15% and 2.26% since 16 December 2011 and 8 December 2011, respectively. The fall on the National Stock Exchange (NSE) was on a high volume of 75.59 crore shares. We had mentioned in our Friday’s closing report that the Nifty would move in the range of 5,090 and 5,250, however, it breached the lower range and closed below it. If the Nifty breaks today’s low of 5,077, we may see it moving in the range of 4,935 and 5,125 with a downward bias.   

Snapping its three-day winning streak, the domestic market opened lower tracking the Asian bourses which were mostly lower on unending Eurozone debt concerns. Fitch Ratings on Friday downgraded the sovereign credit ratings of Italy, Spain Belgium, Cyprus and Slovenia, indicating there is a one-in-two chance of further downgrades in the next two years. The inability of Greece and its private creditors to come to a consensus on debt swap talks also weighed on the investors.

The Nifty opened at 5,164, down 41 points from its previous close, and the Sensex resumed trade with a cut of 96 points at 17,138. The Nifty touched an intraday high of 5,166 in early trade while the opening figure was the high on the Sensex was its high.

Dismal quarterly performance of blue-chips like NTPC and BHEL resulted in a sell-off in the capital goods and power sectors. Banking stocks were also under pressure in trade today.

The market drifted lower in noon trade on a lower opening of the European markets ahead of a meeting of European leaders to chalk out a plan to resolve the debt crisis.

The benchmarks fell to their intraday lows towards the close of trade wherein the Nifty dropped to 5,077 and the Sensex went back to 16,828. The market closed marginally higher, but with a loss of over 2%. The Nifty settled 117 points down at 5,087 while the Sensex tumbled 371 points to 16,863.

The advance-decline ratio on the NSE was negative at 546:1237.

While the broader indices also ended lower, they outperformed the Sensex. The BSE Mid-cap index closed 1.96% lower and the BSE Small-cap index declined 1.82%.

Today’s rout saw all sectoral indices settling in the red. The losers were led by BSE Capital Goods (down 5.55%); BSE Power (down 3.54%); BSE Realty (down 3.10%); BSE Metal (down 2.85%) and BSE Bankex (down 2.78%).

Sun Pharma (up 1.34%); Bajaj Auto (up 0.48%); Jindal Steel (up 0.41%); Hero MotoCorp (up 0.13%) and TCS (up 0.06%) managed to settle higher on the Sensex. The top losers were BHEL (down 10.41%); Sterlite Industries (down 5.99%); Larsen & Toubro (down 5.37%); Hindalco Industries (down 4.81%) and Mahindra & Mahindra (down 4.71%).

The Nifty gainers were led by Sun Pharma (up 1.48%); Ranbaxy Laboratories (up 1.18%); Bajaj Auto (up 0.80%); Jindal Steel (up 0.70%) and Grasim (up 0.40%). The top laggards were BHEL (down 11.33%); Sterlite Ind (down 7%); Sesa Goa (down 6.96%); JP Associates (down 6.57%) and L&T (down 5.75%).

Markets in Asia closed mostly lower on fresh concerns about Europe. The failure of the Greek government and its private creditors to sew an agreement and cautiousness ahead of a crucial European leaders’ summit weighed on the markets.

The Shanghai Composite declined 1.47%; the Hang Seng dropped 1.66%; the Jakarta Composite tumbled 1.79%; the KLSE Composite fell by 0.48%; the Nikkei 225 lost 0.54%; the Straits Times declined 0.96% and the Seoul Composite settled 1.24% lower. Bucking the trend, the Taiwan Weighted jumped 2.40%.

Back home, foreign institutional investors were net buyers of stocks totalling Rs1,240.16 crore on Friday. On the other hand, domestic institutional investors were net sellers of equities amounting to Rs708.46 crore.

Infrastructure major IVRCL today said it has bagged a Rs1,300 crore project from the National Highways Authority of India (NHAI) for widening the Raipur-Bilaspur road stretch in Chhattisgarh. The project is to be executed as a BOT (Toll) project on a design, build, finance, operate and transfer pattern under NHDP-IV, the company said. The stock tumbled 7.68% to Rs45.70 on the NSE.

Bhushan Steel today said it plans to raise up to Rs700 crore by April through a rights issue to part-finance its ongoing expansion projects. The money will be utilised to part-finance the company’s expansion activities, particularly in Odisha, where it is setting up a 3 million tonnes per annum plant. The stock declined 2.93% to close at Rs339.50 on the NSE.

Electrical equipment maker Havell’s India has reported a 41.27% jump in its consolidated net profit for the quarter ended 31 December 2011 at Rs89 crore, up from Rs63 crore in the year-ago period, boosted by healthy performance across all segments of its business.

During the quarter, consolidated net revenue grew 16.41% to Rs1,660 crore from Rs1,426 crore in the year-ago period. The stock gained 3.58% to close at Rs444.30 crore on the NSE.