Market Close: Lucklustre trend biggies stagnate, small caps move..

Globally a cautious approach also saw the same in Indian Indices as Domestic investors traded cautious ahead of fed meet. Fed meet is scheduled on December 11 and 25 bps rate cut by the Fed is already discounted in the market. Small and mid cap counters were the once active as buying continued helping thses to out perform the front line stocks. Suzlon was the exeption and rallied after the company announced private placement to the tune of Rs 2,700 cr in order to fund their capex plans. Reality, Banking and PSU counters were the big gainers. Ending in the negative territory were the stocks on the Metal, Power and FMCG counters. Oil marketing companies rallied as Govt Panel is considering a fuel price hike on Dec 14 which saw good interest these stocks. European indices gained strength after a weak start and continued to trade in green.

Sensex closed lower by 35 points at 19930.68. Weighing on the Sensex were the losses in TCS (1035.7,-2 percent), BHEL (2677.3501,-2 percent), Cipla (192.8,-2 percent), HDFC (2872.1499,-2 percent) and HDFC Bk (1693.2,-2 percent). Losses were restricted by gains in Hindalco (193.1,+3 percent), ICICI Bk (1273.75,+2 percent), Infosys (1748.45,+2 percent), Bharti Tele (970.45,+1 percent) and Rel Energy (1946.05,+1 percent).

Piramyd Retail is set to be acquired by Indiabulls Reality subsidiary. Indiabulls would pay Rs 75 per share for the 64% stake held by the promoters. Total deal size is of Rs 208 cr. An open offer of another 20% stake can be expected by Indiabulls. The growth of the organized retail in the country would continue to grow in double digits on yearly comparison. However, It is the margin levels that is a cause of worry. With the constant rise in the rentals, man power costs and other overheads the margins are expected to be under pressure. Entry of big industrial houses like Reliance, Tata, Bharti and Birla with deep pockets would further add to the competition on the retail counters. India Bulls is eyeing the Real estate part and not the Retail business. Better to aviod any enter here. However, Piramyd retail closed higher by 10% for the day while Indiabul reality closed higher by 3%.

Ceat tyres continued to zoom ahead of the delisting which is expected early next year. As per the restructuring plan approved by the Bombay high court holders of 4 shares of ceat tyres would be issued 3 new shares of ceat tyres and 1 new share of a new company that would be holding the group investments. New company would also be listed on the bourses. Post the implication of the restructuring scheme the growth can be expected from the tyres business. Company has takes the out sourcing strategy to increase its market share which currently is at 12%. Ceat imports tyres from china and from the global manufacturing units of Pirelli. Outsourcing is done of the low value added products which comprises mainly of 2 and 3 wheeler tyres. Transfer of operations from the Bhandup factory to the Nasik unit are going on as planned by the company. Company intends to sell a part of the Bahndup plant (6 acres) and the amt realized can be in the range of Rs 70-80 cr. This is also a reason for higher volumes witnessed on the ceat counter. Ceat fails to be a fundamentally strong company compared to other competitors. However, Trading upsides can be considered in ceat. Do read our note on Ceat to know more about the company. Ceat closed higher by 5%.

Technically Speaking: Sensex traded in a narrow range and volatile for the days. Sustainance above 20000 levels looks at an easy task. Sensex Support at 19725 and Resistance at 20080. Traders are advised to remain on the sidelines till the direction is clear.