Nifty has to close above 5,245 to regain the uptrend

The market settled down for the third day in a row on domestic concerns and dismal global cues. Yesterday we had mentioned that the Nifty may move down to the level of 5,160 and then to 5,100. Today the index fell to 5,171 but made a smart recovery of 49 points to close at 5,220. The Indian stock market will be closed on Thursday on account of a local holiday. If the benchmark manages to close above 5,245 on Friday, it may be seen as a first sign of reversal. After this we may see the Nifty reaching the level of 5,285 and then higher. However, if Nifty goes below today’s low, the decline may continue. The National Stock Exchange (NSE) saw a volume of 76.85 crore shares.

The market opened in the negative tracking the weak global markets. Overnight, US stocks settled lower on worries about the European debt crisis and a slowdown in global recovery. On the domestic front, the depreciation of the rupee in early trade also weighed on investors. The Nifty opened at 5,207, down 15 points from its previous close, and the Sensex lost 46 points to open trade at 17,127.

Selling pressure in early trade saw all sectoral indices trading in the negative. Volatile trade was seen since the start of the day’s trade. However, select buying that began around 10.00am pushed the market into the green. The gains helped the indices hit their intraday highs in late morning trade. At the highs, the Nifty touched 5,244 and the Sensex rose to 17,239.

Institutional selling pressure in oil & gas, metal and power sectors pushed the market lower once again. The benchmarks then began a southward journey in the absence of any local cues. They fell to the day’s lows in the post-noon session with the Nifty falling to 5,171 and the Sensex going down to 17,009.

However, bargain hunting at lower levels resulted in a smart recovery and ensured a flat finish with a negative bias. The Nifty closed two points lower at 5,220 and the Sensex settled at 17,146, a cut of 28 points over its previous close.

The advance-decline ratio on the NSE 496:1219.

Among the broader indices, the BSE Mid-cap index shed 0.08% and the BSE Small-cap index fell by 0.61%.

The top sectoral gainers were BSE Realty (up 0.90%); BSE IT (up 0.78%); BSE Bankex (up 0.69%); BSE Healthcare (up 0.40%) and BSE TECk (up 0.32%). The leading losers were BSE Metal, BSE Oil & Gas (down 1.51% each); BSE PSU (down 0.95%); BSE Power (down 0.52%) and BSE Capital Goods (down 0.31%).

The key performers on the Sensex were Wipro (up 1.97%); HDFC Bank (up 1.52%); Bajaj Auto (up 1.13%); DLF (up 1.09%) and Infosys (up 1.07%). The major losers were Sterlite Industries (down 3.95%); NTPC (down 2.41%); Reliance Industries (down 1.94%); Bharti Airtel (down 1.91%) and BHEL (down 1.85%).

Jaiprakash Associates (up 6.39%); Reliance Power (up 5.85%); HCL Technologies (up 2.85%); HDFC Bank (up 1.99%) and Bajaj Auto (up 1.94%) were the main gainers on the Nifty. Sterlite Ind (down 4.43%); Sesa Goa (down 3.18%); NTPC (down 2.61%); Power Grid Corporation (down 2.30%) and Jindal Steel (down 2.18%) settled at the bottom of the index.

Markets in Asia closed in the red on renewed worries whether Greece would be able to manage its debt issues. An analyst pointed out that markets are expected to remain sensitive to European cues till 20th March, the Greece bond redemption date.

The Shanghai Composite declined 0.65%; the Hang Seng dropped 0.86%; the Jakarta Composite fell by 0.62%; the KLSE Composite tanked 0.95%; the Nikkei 225 slipped 0.64%; the Straits Times fell by 0.64%; the Seoul Composite was down 0.91% and the Taiwan Weighted closed 0.44% lower. At the time of writing, the key European indices were up between 0.28% and 0.72% and the US stock futures were in the positive.

Back home, foreign institutional investors were net sellers of shares aggregating Rs241.22 crore on Tuesday while domestic institutional investors were net sellers of equities amounting to Rs179.91 crore.

Global rating agency Moody’s today downgraded ratings assigned to various debt programmes of public sector lender Bank of India (BoI) by one notch due to deteriorating asset quality, among others. The stock fell by 0.64% to close at Rs350 on the NSE.

HCL Technologies today said it has signed a five-year IT infrastructure outsourcing deal worth $300 million with Finnish recyclable product maker UPM. As part of the agreement, HCL will provide data centre, end user support, network services and professional IT services to UPM. HCL Tech closed at Rs495 on the NSE, up 2.83% over its previous close.

Infrastructure major Sadbhav Engineering has been declared as the lowest bidder for the four-laning of Gomati ka Chauraha-Udaipur section of National Highway 8 in Rajasthan. The Rs1,280 crore project is under the National Highway Development Programme (NHDP) phase IV on design, build, finance, operate and transfer basis, the company said on Wednesday. The stock settled at Rs133 on the NSE, down 2.85%.