Correction continues; Nifty below 6000

Major headlines

Jet Airway's India passenger traffic up 37% in September; the stock ends 0.03% higher

State Bank of India hikes BPLR, base rate; the stock closes 0.87% lower

Kotak Mahindra Bank Q2 consolidated net profit up 21% yoy; the stock ends 0.95% lower



Indian indices

It was another weak session of trade on the Dalal Street. The Indian markets fell to a one-month low amid volatility, led by raw material producers, after China unexpectedly raised its lending and deposit rates, prompting concern that the global economic recovery may slow. The markets declined sharply in the last one-hour of the trades like yesterday and closed more than half-a-percent down. The Nifty slipped below its psychological levels of 6000 for the first time in the last 15 sessions.

Sterlite Industries (India), the biggest copper and zinc producer, dropped by 3.5%. Hindalco Industries, the biggest aluminum producer, retreated for the fifth day.

The Sensex began the session at 19923, lower by 60 points. In the initial trades, the index soon erased all its losses and turned positive. The Sensex remained rangebound and hovered between the negative and positive zone. The index witnessed occasional bout of volatility in the morning trades. In the afternoon session, the index hit the day’s high of 20044. From the day’s high, the Sensex erased all its gains, hitting the day’s low of 19823 as strong selling pressure was seen in metal and realty stocks.

At the closing bell, the Sensex shut lower at 19872, down by 111 points. The Nifty closed lower by 45 points at 5982.

Bond and Rupee update: India’s ten-year bonds were little changed, with yields holding near their highest level in two years, on speculation that the share sales in the state-owned companies will squeeze cash in banks. India’s rupee traded near a one-week low on concern that overseas investors will sell the nation’s stocks.

Market Outlook: Tonight in the US, we have Morgan Stanley and Wells Fargo to report earnings, along with eBay, Boeing and United Technologies. The Fed will also release its Beige Book, which will bring attention back to QE2 speculation.

Market sentiment

The market breadth was negative as losing stocks outdid advancing ones. On the BSE, out of the 3,071 stocks, 1,827 declined while 1,089 gained. Hundred and fifty-five stocks remained unchanged.

Sectoral & stock screening

Ten sectors closed lower, while three managed to post gains. The BSE Metal was hit the most, down by 2.22%, followed by the BSE Realty that fell by 1.37% and BSE Consumer Durables (CD) declined by 1.11%. The BSE Consumer Goods (CG) gained the most by 0.20%, followed by BSE Heath Care (HC) and BSE Oil & Gas that were up by 0.16% each.

On 'A' group stocks’ front, the major gainer was Jubilant Organosys, up by 5.52%, followed by Central Bank of India that surged by 5% and IDBI Bank advanced by 4.27%. Among laggards, Unitech slid the most by 4.20%, followed by Sterlite Industries that fell by 3.54% and Indian Bank declined by 3.10%.

Viewing volumes

India's second largest developers - Unitech was traded the most, with over 0.43 crore shares changing hands on the BSE, followed by industrial finance company - IFCI (0.42 crore shares), wind turbine major - Suzlon Energy (0.42 crore shares), a public sector bank - IDBI Bank (0.33 crore shares) and a government company - Gujarat State Petronet (0.27 crore shares).

Global signals

European shares surged after minutes from the latest Bank of England Monetary Policy Committee boosted expectations of further quantitative easing.

All the major Asian markets shut in the negative terrain except Shanghai Composite and Kospi.

The US stock index futures point to a higher opening on the Wall Street. Earnings of Boeing, Genzyme Corp, Altria Group, Morgan Stanley and United Technologies will be in focus.