Indecisiveness continues on the bourses: Monday Closing Report
Moneylife Digital Team 13 August 2012

The Nifty has to decisively break out of the range of 5,300 and 5,377 for further direction

 
The Asian indices had a weak opening and so did the indices at home. Both the Sensex and the Nifty opened in the negative at 17,552 and 5,316, respectively. On Friday we had mentioned that if the Nifty breaks the day’s low of 5,294, it may head for 5,200. Today the index could sustain itself above the Friday’s low and made a higher high. In the last hour of trade today, the benchmarks made a smart recovery to wipe off the losses incurred in the past two trading days. The Nifty has to decisively break out of the range of 5,300 and 5,377 for further direction. The National Stock Exchange (NSE) saw volume of 50.47 crore shares.
 
Japan’s economy grew at an annualized pace of 1.4% in the second quarter—lower than analysts’ expectations of 2.7% rise—as exports slowed and a domestic demand led recovery showed signs of faltering. That marked a steep slowdown from an upwardly revised advance of 5.5% in the first quarter. Japan said its economy grew 0.3% in April-June from the first quarter, half as much as expected, as Europe’s debt crisis weighed on export demand and consumer spending began to lose momentum.
 
With weak economic data coming from across the globe, economies anticipate that the further fall in equities may be controlled by a fresh round of easing by major central banks.
 
Until the last one hour of the trading session, both Sensex and Nifty saw range bound movement. The Sensex and Nifty hit their intraday low after a weak opening of the European indices. The Sensex hit a low of 17,522 while the Nifty hit a low of 5,309. Both the indices hit a higher high of 17,642 and 5,352. The Sensex closed at 17,633 (76 points up, 0.43%) while the Nifty closed at 5,348 (28 points up, 0.52%). 
 
The advance-decline ratio on the NSE was positive at 782:641.
 
Among the broader indices, the BSE Mid-cap index gained 0.49% and the BSE Small-cap index rose 0.46%.
 
With the exception of the BSE Auto index (down 0.12%), all other sectoral gauges were in the positive. The top gainers were BSE Realty (up 2.41%); BSE Consumer Durables (up 1.70%); BSE Capital Goods (up 1.08%); BSE Power (up 1.02%) and BSE PSU (up 0.75%). 
 
The top performers on the Sensex were HDFC (up 3.71%); Sterlite Industries (up 2.66%); Maruti Suzuki (up 1.95%); Bajaj Auto (up 1.68%) and BHEL (up 1.66%). The key losers on the index were Tata Motors (down 1.55%); Hindustan Unilever (down 1.43%); Hero MotoCorp (up 1.32%) and Tata Steel (down 1.19%).
 
The top two A Group gainers on the BSE were—United Spirits (up 11.87%) and United Breweries (up 9.54%).
The top two A Group losers on the BSE were—Muthoot Finance (down 3.23%) and Sun TV Network (down 2.91%).
 
The top two B Group gainers on the BSE were—Kingfisher Airlines (up 20%) and Ruchira Paper Products (up 19.96%.
The top two B Group losers on the BSE were—Kemrock Industries & Exports (down 19.99% and ABC India (down 12.46%).
 
The top gainers on the Nifty were HDFC (up 6.46%); DLF (up 3.14%); Reliance Infrastructure (up 3.05%); Sterlite Industries (up 2.66%) and Sesa Goa (up 2.25%). Hindalco Ind (down 1.50%); Tata Motors (down 1.49%); Hero MotoCorp (down 1.29%); HUL (down 1.25%) and Tata Steel (down 1.15%) were the main losers on the index.
 
Fitch Ratings has put out a warning saying that it might lower India’s sovereign rating. It said that the possibility of downgrading India's sovereign rating is more than 50% in the next 12 to 24 months.
 
Senior officials from the Group of 20 largest economies are likely to meet to try and coordinate a response to surging food prices due to a severe drought in the US, a leading London based newspaper reported.
 
 Most of the Asian indices closed in the red on signs of slower economic growth. However, investors kept hopes alive of new initiatives to boost growth. 
 
The Shanghai Composite tumbled 1.51%; the Hang Seng declined 0.27%; the Jakarta Composite dropped 0.94%; the Nikkei 225 fell 0.07%; the Seoul Composite tanked 0.72% and the Taiwan Weighted was down 0.06%. On the other hand, the KLSE Composite gained 0.06% and the Straits Times advanced 0.35%.
 
The European indices had a mixed performance at the time of writing while the US stock futures were trading marginally in the red.
 
Back home, foreign institutional investors were net buyers of shares amounting to Rs83.16 crore on Friday whereas domestic institutional investors were net sellers of equities totaling Rs536.69 crore. 
 
The board of Israel-based Taro Pharmaceutical has agreed to sell the remaining stakes of the company to Sun Pharmaceutical and its affiliates for an enhanced price of $39.50 per share. The merger agreement provides that all shareholders of Taro other than Sun Pharma and its affiliates will receive a cash payment of $39.50 per share upon the closure of the merger deal. The raised buy-out offer by Sun Pharma is over 61% from it's earlier offer of $24.50 a share. Sun Pharma rose 1.55% to close at Rs134 on the NSE.
 
Welspun Corporation, a large diameter pipe manufacturer, today said it has bagged orders worth Rs819 crore from overseas and domestic markets. With this, the current order book of the company stands at Rs10,000 crore, the company said in a statement. Welspun closed at Rs101.80 on the NSE, down 1.12% from its previous close.
 
Oil & Natural Gas Corporation (ONGC) has decided to set up a Rs5,000 crore urea manufacturing unit in North Tripura district in joint venture with a private company. Khobal has been selected as the site for the project considering its proximity to the Khobal gas field from where natural gas (hydrocarbon) would be supplied, a company official said. ONGC rose 0.38% to Rs280 on the NSE.
 
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