Close: A profit taking day on the back of no positive triggers !

What started off as a lacklustre market, ended on a weak note of profit taking. Market were weak . The markets were a bit volatile in the morning session and in the absense of any news or positive triggers closed in deep red. Investors played in a safer side ahead of FNO expiry. The FNO expiry for February Futures and Options expires this Thursday. There was not much support from the global markets. Selling pressure was witnessed across all the board only selective stock had buying activity like Media, FMCG, Energy and Steel stocks. The Asian markets traded mixed for the day and European markets were in red. The Key would be interest rates in Japan. Bank of Japan will announce its decision. A hike in interest rates could bring in downsides. Low interest rates in Japan have been the source of easy money across the world and may be its time for this to flow back.

Sensex closed down by 150 points at 14253.38. Weighing on the Sensex were losses in ONGC (875.6,-3 percent), Grasim (2570.8999,-3 percent), Rel Energy (520.9,-3 percent), HLL (199.65,-3 percent) and RCVL (452.15,-2 percent). Losses are restricted by gains in Ranbaxy (395.5,+1 percent), ITC (175.8,+1 percent), Cipla (254.55,+0 percent), NTPC (142.1,+0 percent) and TISCO (444.15,+0 percent).

Automobile stocks closed in red for the day. As per reports Bajaj Auto Ltd is close to setting up a new manufacturing plant at Chakan near Pune for its foray into the four-wheeler segment. There are also plans to set up a production unit in Brazil for two wheelers. Bajaj is under negotiations to get land for new plant. The plan is to set up new goods carrier manufacturing facility in Chakan, Pune, and the new goods-carrier would be of one tonne capacity on the lines of Tata Ace. Bajaj is also planning to set up a two wheeler plant in Brazil. Its diversification but really in essense its not. The company's 3 wheelers have been doing well in the goods segment as well. ACE threatens to take that market and the natural reaction would be to counter that with an aspirational product like the Ace. However near term the increase in interest rates could see worries on demand. The margins are under pressure as the company has chosen the competitive route. Bajaj closed down by 1.2% and its peer Hero Honda closed marginally down as well.

FMCG stocks traded mixed for the day, Hindustan Lever Ltd (HLL) posted results for the fourth quarter and full year ended December 2006 which came in lower than expectation. For FY06 the company has posted a topline growth of 9.4% at Rs 12,103 cr yoy, operating margins expanded by 60 basis points due to stock related adjustments, lower interest charges. Bottomline growth was 13.7% at Rs 1855 cr yoy (excluding the extraordinary). For Q4 it has posted the topline growth of 6% at Rs 3156 cr, bottom line growth of 10% at Rs 483 cr on yoy basis. Food business grew by 11% on yoy basis. Results for the quarter are not comparable to those of 4FY06 to the extent of amalgamation of Vashisti Detergents Limited and the demerger and subsequent disposal of Doom Dooma and TEI plantation divisions. HLL closed down by 2.78% and its peer Colgate, P&G, Dabur also closed in red.

Technically Speaking: It was a volatile session for the whole day before closing. Sensex touched intraday high of 14466 and low of 14230. It has good support at 14230 and resistance at 14500. Expect a pullback to 14500 as the expiry gets closer. Market turnover stood at Rs 3871 cr. Overall breadth was in favor of Decliners where they stood at 1908 and Advancers stood at 707. The Resistance level was at 14400-14551 while Support at 14164-14079 levels.