As long as Nifty does not break 4788, it ha a good chance of hitting 5,040

The market snapped its three-day gaining streak to settle lower as the weakening rupee ignited fresh concerns about the pace of economic growth. Yesterday we had mentioned that the Nifty has to hold itself above 4,789, which may take the benchmark to the level of 5,040. The Nifty today made a higher high, but couldn’t maintain the momentum and went into the red in the noon session. Apart from sustaining above the support of 4,789, the benchmark has to strongly close above today’s high which may take it up to the level of 5,040. The National Stock Exchange (NSE) saw a higher volume of 53.61 crore shares.

The market opened higher on a recovery in the rupee and positive cues from the Asian markets which were in the green in morning trade on hopes of Europe working towards new solutions to tackle its debt problems. The Nifty opened 49 points higher at 4,955 and the Sensex resumed trade at 16,344, up 161 points over its previous close.

The benchmarks hit the day’s highs in initial trade itself with the Nifty going up to 4,956 and the Sensex scaling 16,367. All sectoral indices, led by capital goods and consumer durables, were trading in the positive zone.

The market pared part of the early gains as the rupee dropped to a new record low of 55.09 to a dollar. The indices, which were sideways till noon, witnessed a sharp fall as institutional investors increased selling.

The losses expanded in the post-noon session as investors feared that the depreciation in the rupee would make imports costlier and restrict growth.

A further fall in the rupee to 55.19 a dollar in afternoon trade added to investors’ woes. The benchmarks dropped to their intraday lows in late trade. At this point, the Nifty went back to 4,850 and the Sensex tumbling to 16,001.

The market closed near the lows of the day, snapping its three-day winning streak. The Nifty settled 46 points (0.93%) lower at 4,861 and the Sensex lost 157 points to finish trade at 16,026.

The advance-decline ratio on the NSE was 613:1045.

Among the broader indices, the BSE Mid-cap index fell 0.59% and the BSE Small-cap index declined by 0.68%.

BSE IT (up 0.46%), BSE TECk (up 0.15%) and BSE Consumer Durables (up 0.11%) were the sectoral gainers. The top losers were BSE Metal (down 1.83%); BSE Bankex (down 1.51%); BSE Power (down 1.45%); BSE Realty (down 1.23%) and BSE Capital Goods (down 1.21%).

The Sensex gainers were Tata Motors, TCS (up 1.17% each); BHEL (up 1.04%) and HDFC (up 0.24%). The key losers were Tata Power (down 5.29%); Maruti Suzuki (down 4.50%); Sterlite Industries (down 3.96%); State Bank of India (down 3.43%) and Hindalco Industries (down 2.99%).

The Nifty was led by TCS (up 2.46%); HCL Technologies (up 2.20%); Tata Motors (up 1.55%); Cairn India (up 1.33%) and SAIL (up 1.21%). The main losers were Sesa Goa (down 5.38%); Tata Power (down 5.33%); Maruti Suzuki (down 5.04%); Sterlite Ind (down 4.01%) and Sun Pharma (down 3.65%).

Markets in Asia closed higher on hopes that Germany and China would look at fresh initiatives to spur growth. Reports that the Chinese government would boost investment in infrastructure and German finance minister’s assertion that the country would consider all available solutions to help growth in the Eurozone supported gains in Asia.

The Shanghai Composite surged 1.06%; the Hang Seng advanced 0.62%; the Jakarta Composite jumped 2.06%; the KLSE Composite rose 0.52%; the Nikkei 225 climbed 1.10%; the Straits Times gained 1.20%; the KOSPI Composite was up 1.64% and the Taiwan Weighted settled 1.15% higher.

At the time of writing, the key European markets were up between 0.53% and 0.71% while the US stock futures were in the negative.

Back home, foreign institutional investors were net sellers of shares totalling Rs79.59 crore on Monday. On the other hand, domestic institutional investors were buyers of equities amounting to Rs149.20 crore.

Piramal Healthcare today said it has completed the first phase of clinical trials of a new oral drug for treating cancer and will move to the next stage of development. The company said it has established safety, apart from determining maximum tolerated dosages in humans for its new molecule code named P1446A-05 in multi-centric Phase-I trials conducted in India and Canada. The stock gained 0.14% to close at Rs420.65 on the NSE.

Venus Remedies today said it has received patent approval in South Africa for an antibiotic combination of carbapenem and aminoglycoside, to be used for treating bacterial infections. Having received this patent grant from Companies and Intellectual Property Registration Office (CIPRO), South Africa, the company is hopeful of capturing a major share in the market. The stock closed at Rs164.30 on the NSE, up 1.92% over its previous close.

Power and automation major ABB India has bagged a Rs 175-crore order from National Thermal Power Corporation to build two sub-stations in Maharashtra. ABB’s turnkey project scope comprises the design, engineering, supply, installation, commissioning and associated civil works for the sub-stations. The project is scheduled for completion in 2016. ABB gained 2.44% to close at Rs727.60 on the NSE.