Mid Market - Sensex inches up amid persistent weak trade Analysis for Jan 09, 2012

In the absence of positive global cues, the broader Indian benchmark indices continued to move in the negative terrain during the day"s trading, but some buying support arrested the loss by few points. The 30-share barometer index of Bombay Stock Exchange (BSE), Sensex was hovering near psychological support levels as traders booked profits ahead of meeting between Germany and France top leaders to discuss fiscal coordination to improve the health of Euro-zone economy. The downward spiral in growth may hold the central bank from cutting down interest rates, which the Indian markets so eagerly anticipate. The market experts opined that investors may follow wait-and-watch approach amid the foggy economic outlook on the domestic front and uncertain global cues on the global front. There seems to be no respite to the traders as the negative bias paved in the market due to persistent Euro-zone debt crisis and flat performance of US stock market on Friday. Among the thirteen sectoral indices, most sectoral indices, except for the IT and Healthcare, were in the red with Metals, Oil & Gas, Auto, and Banking sector leading the decline.

At 12:14 Hours, BSE SENSEX was at 15,771.2 down by 77.6 points or by 0.49 per cent and then NSE Nifty was at 4,728.35 down by 18.55 points or by 0.39 per cent.

The BSE MIDCAP was at 5,316.23 up by 18.61 points or by 0.35 per cent, while the BSE SMLCAP was at 5,820.09 up by 58.48 points or by 1.01 per cent.

Meanwhile, no good news is expected to come from the economy front. The international sanctions against Iran only add to the economic woes of India as Iran is the second largest supplier of crude oil to the country after Saudi Arabia. The sanctions may put further upward pressure on crude oil prices which will once again increase inflationary pressures in the economy. This may hold the central bank from cutting down interest rates, which the Indian markets so eagerly anticipate.

Index heavyweight Reliance Industries, ONGC, Coal India, Hero Motocorp, ITC, and Tata Steel shed by nearly 1 per cent.

Among others, rate sensitive Auto and Banking sectors were witnessing surge in the selling activities. The Market breadth, indicating the overall strength of the market, was weak. On BSE out of total shares traded 2,466, shares advanced were 1,326 while 1,038 shares declined and 102 were unchanged.

The top losers of the BSE Sensex pack were Bharti Airtel Ltd. (Rs. 322.40, 2.57%), Coal India Ltd. (Rs. 313.75, 1.89%), Tata Motors Ltd. (Rs. 200.30, 1.60%), Bajaj Auto Ltd. (Rs. 1425.00, 1.59%), State Bank of India (Rs. 1644.25, 1.53%), among others.

Among the sectoral indices in BSE, Oil&Gas index was at 7,622.26 down by 58.91 points or by 0.77 per cent. Bharat Petroleum Corporation Ltd. (Rs. 467.10, 1.76%), Reliance Industries Ltd. (Rs. 707.50, 1.01%), Oil And Natural Gas Corporation Ltd. (Rs. 254.10, 0.99%), Hindustan Petroleum Corporation Ltd. (Rs. 240.55, 0.82%), Oil India Ltd. (Rs. 1114.00, 0.52%).

Following the Oil & Gas index, BSE Auto index was at 8,110.28 down by 62.43 points or by 0.76 per cent. Bajaj Auto Ltd. (Rs. 1424.50, 1.63%), Tata Motors Ltd. (Rs. 200.30, 1.60%), Mahindra & Mahindra Ltd. (Rs. 646.90, 1.12%), Exide Industries Ltd. (Rs. 115.00, 0.86%), Ashok Leyland Ltd. (Rs. 23.35, 0.43%).

At the meantime, most of the Asian peers were trading in red on weak global cues from the European and US markets. The Japanese Nikkei is shut down today, while the Shanghai Composite was up by 1.44 per cent. Hong Kong"s Hang Seng was down by 0.74 per cent, and Taiwan Weighted was trading down by 0.39 per cent below the benchmark.

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