I think you have to learn that there's a company behind every stock, and that there's only one real reason why stocks go up. Companies go from doing poorly to doing well or small companies grow to large companies. -Peter Lynch.
The bulls will hope the earnings season gives them more reasons to hold on to quality companies and dump the inferior ones. Infosys and Bajaj Auto are the big companies declaring their results today. We expect Infosys to report 0.4% QoQ growth in revenues and 6.3% sequential decline in PAT. For Bajaj Auto, we expect 65% YoY jump in revenues and 189.6% YoY jump in PAT.
IIP data for November is due around noon today, and monthly inflation data is scheduled to be released on Thursday. Industrial output is seen rising by 10% in November from a year earlier after expanding by 10.3% in October. Marketmen will watch these crucial data points for cues on what action, if any, the RBI will take on Jan. 29.
The current phase of consolidation may extend for a few more days till there is further clarity on the health of the economy and India Inc. The NSE Nifty is likely to trade in a broad range of 5182 to 5310. Beware of the unusual spurt in some non-index stocks.
Indian markets had a fairly muted day of trade as bulls and bears both seemed to be on a wait and wait mode. With the results season underway, and key economic data scheduled for this week, traders and investors alike maintained their reluctance towards fresh buying. At the same time, small- and mid-cap stocks continued to hog the limelight and outperformed their frontline peers.
Realty and Telecom stocks were among the other notable gainers. The BSE Oil & Gas index ended in the red thanks to the treasury sale by the index heavyweight Reliance Industries. The stock single handedly dragged the Sensex down by 44 points with the stock itself losing 2%.
Other noteworthy gainers were Bharati Shipyard and ABG Shipyard which were up 20% each.
The BSE Sensex marginally lost 14 points to end at 17,526 after touching a high of 17,776 and a low of 17,500. The Nifty ended flat at 5,249.
Equity markets in Asia ended in the green. The Nikkei in Japan was shut, while Australia's S&P/ASX ended higher by 0.8%. The Shanghai SE Composite declined 0.2% and Hang Seng index in Hong Kong gained 0.6%.
In Europe, stocks were trading higher as well. The DAX in Germany was up 0.8% and the CAC 40 index in France was up 1%. The FTSE in the UK was up 1%.
Coming back to India, among the BSE sectoral indices, the Realty index was the top gainer, adding 2.5%, followed by the Teck index that was up 1% and the BSE Auto index was up 1%. The BSE Mid-Cap index advanced 0.9% while BSE Small-Cap index added 1.8%.
Among the 30-components of Sensex, 15 stocks ended in the negative terrain and 15 ended in the green. Reliance Industries, Wipro, BHEL, Hindalco and SBI were among the top losers.
On the other hand, DLF, Grasim, TCS, Hero Honda, Maruti and JP Associates were among the top gainers.
Outside the frontline indices, the big losers in the broader market were PTC, IFCI, Jain Irrigation and Videocon Industries. On the other hand, gainers included GE shipping, MTNL, Gujarat NRE Coke BEL and Madras Cement.
MBL Infrastructures which started trading at Rs190, a premium of Rs10 over the issue price of Rs180 per share on the BSE ended at Rs205 translating into a premium of 14% against its issue price.
MBL Infrastructure is an integrated infrastructure construction and project development and maintenance company, entered the capital market on November 27, 2009 targeting to raise about Rs1bn, offering 57,00,000 equity shares of Rs10 each at a price band of Rs165 - Rs180.
The IPO proceeds will be invested in capital equipments and used to meet working capital requirements.
Shares of Reliance Industries slipped 2% to end at Rs1081. The Petroleum Trust sold 33mn equity shares of the company realizing nearly Rs34.65bn at an average price of Rs1050 per share.
Reliance Industrial Investments and Holdings Ltd., a wholly owned subsidiary of RIL, is the beneficiary of the Trust.
NTPC Vidyut Vyapar Nigam, the power trading arm of NTPC plans to buy solar power at a rate set by the Central Electricity Regulatory Commission, Minister for New and Renewable Energy Farooq Abdullah said in New Delhi today.
The government plans to add ~20,000MW of solar power capacity in three phases by 2022. The stock gained 1% to end at Rs233, it opened at Rs231 it touched an intra-day high of Rs235 and a low of Rs232 and recorded volumes of over 0.77mn shares on BSE.
SAIL announced that sales of its value-added construction grade products rose 23 % to 417,000 metric tons in the nine months ended Dec. 31. Shares of SAIL gained 1.5% to end at Rs242. The scrip opened at Rs239 it touched an intra-day high of Rs245 and a low of Rs235 and recorded volumes of over 1.4mn shares on BSE.
The Chinese government dropped a rule stipulating that more than 70% of the wind turbines in use in China must be produced domestically, reports stated. The policy change will spur foreign investment in China’s wind-turbine industry.
Shares of Suzlon surged by over 2.5% to end at Rs94.75. The scrip opened at Rs93 it touched an intra-day high of Rs95.20 and a low of Rs92.7 and recorded volumes of over 8.3mn shares on BSE.