Post Market Commentary - Jan 7 2010

Indian equity ended the day on a weak note. The markets which belled the day on a flat note and immediately slipped into the negative terrain. Intense profit booking was seen in some of the frontline stocks of IT, Auto and FMCG stocks.

However, significant buying which was witnessed in Oil&Gas, Consumer Durables and Banking stocks provided support to the markets.

Stocks retreated in Asia, snapping four days of gains, while oil declined after China, the engine in the global recovery, curbed lending growth. The rate on Chinese three-month bills rose for the first time in 19 weeks. The MSCI Asia Pacific Index fell 0.3% to 123.68 at 5:20 p.m. in Tokyo.

European stocks fell from the highest levels in more than 15 months after China, the driver of the global recovery, took steps to curb lending growth. US index futures dropped.

The Sensex ended the day with a loss of 85.41 points, or 0.48% at 17,615.72 after touching a high of 17,733.34 and a low of 17,566.54. The broad-based NSE Nifty fell 18.70 points, or 0.35% at 5,263.10 after hitting a high of 5,302.55 and a low of 5,244.75.

BSE Midcap ended the day on a negative note down by 0.02%. On the other hand, BSE Smallcap ended on a positive note up by 0.67%.

Major gainers in the 30-share index were Hindalco Industries (2.40%), Reliance Industries (1.51%), Tata Steel (1.16%), Reliance Communications (0.96%), Bharti Airtel (0.64%), and ACC (0.61%).

On the other hand, Tata Motors (3.37%), Tata Consultancy Services (2.61%), Grasim Industries (2.53%), Hero Honda Motors (2.51%), Infosys Technologies (2.30%), and Wipro (2.25%) were the major losers in the Sensex.

Overall market breadth was positive. Out of the total 2,969 shares traded at BSE, 1,638 advanced, 1,237 declined while 94 remained unchanged.

Major gainers in the sectoral indices were BSE Oil & Gas which climbed 1.24%, Consumer Durables gained 1.11%, Metal gained 0.07%, Power rose 0.17%.

Among major losers in the sectoral indices - BSE IT fell 2.22%, Auto dropped 1.72%, TECk went down 1.48%, HC fell 0.95% and Realty dropped 0.63%.

``The trend remains up but the undercurrent is soft. The market is expected to remain range bnound with boundaries being 5,150 and 5,350,`` said Avinash Gupta, AVP Research Equity, Bonanza Portfolio while opining on the trends of the equity market for tomorrow.

Inflation:

Food price inflation witnessed a marginal decline for the week ended December 26 to stand at 18.22% as against 19.83% in the previous week due to lower prices of fruits & vegetables (6%), gram (3%) and tea (1%).

Inflation for primary articles stood at 14.39% (y-o-y) for the week ended Dec. 26, 2009 as compared to 15.49% (y-o-y) for the previous week.