Volatile markets end lower

Major headlines

Wipro dips on weak Q2 results; the stock ends 4.54% down

Coal India IPO price by October 24, exit option till October 25

Bank of India slides on below expectation Q2 results; the stock ends 2.78% lower



Indian indices

After a stellar rally in the previous session, the domestic markets were unable to hold on to its gains in today’s trade and ended the session with losses. The realty and fast moving consumer goods (FMCG) stocks weigh on the markets. The negative cues from the European markets also dampened the sentiments. The markets fell amid high volatility, as investors remained cautious ahead of the Group of 20 (G-20) meet. High volatility was witnessed as traders rolled over positions in the derivative segment ahead of the expiry of the October contracts on October 28, 2010.

India’s leading software developer, Tata Consultancy Services, gained over 5% after announcing strong Q2 earnings. India’s third largest software developer, Wipro, fell over 4% on posting disappointing Q2 numbers.

The Sensex started the session at 20334, higher by 74 points. The index in initial trades hit the day’s high at 20352. The Sensex remained rangebound with a positive bias throughout the morning session. In the afternoon trades, the index erased all its gains, hitting the day’s low at 20089 as the European markets opened in the negative territory. However, from the day’s low, the index trimmed some of its losses in the last hour of trades.

At the finishing line, the Sensex ended the session at 20166, lower by 95 points. The Nifty shut shop at 6066, down by 35 points.

Bond update: India’s ten-year bonds rose for the second day after the central bank said yesterday that it will buyback Rs120 billion of bonds due this year and next through an auction on October 25, 2010.

Market Outlook: There is no major economic data in the US tonight. On earnings’ front, we have Verizon Wireless (Dow Component) declaring its results. While on the other side of Atlantic, Europe will be more in focus with the release of the monthly IFO Business Survey in Germany and an estimation of the eurozone's current debt to GDP ratio.

Market sentiment

The market breadth was negative as falling stocks outdid the advancing ones. On the BSE, out of the 3,118 stocks, 1,593 declined while 1,393 rose. Hundred and twenty-nine stocks remained unchanged.

Sectoral and stock screening

Of the 13 sector indices on the BSE, six closed in the green while the remaining seven in the red. BSE Information Technology (IT) was the best performer, rose by 1.19%, followed by BSE TECk that was up by 0.72% and BSE Consumer Durables (CD) gained by 0.20%. On the other hand, BSE Realty fell the most by 1.61%, followed by BSE FMCG that declined by 1.35% and BSE Metal slipped by 1.21%.

Among 'A' group stocks, Indiabulls Financial was the topper, rose by 11.29%, followed by Pipavav Shipyard that surged by 10.06%. Tata Consultancy Services advanced by 5.72% after posting strong Q2 results. On the other hand, Mahindra & Mahindra Financial slid by 5.56%, followed by Piramal Healthcare that fell by 5.03%. Wipro declined by 4.54% after announcing below expectation Q2 results.

Viewing volumes

Indian shipbuilding company - Pipavav Shipyard posted the highest volumes today, with over 3.83 crore shares changing hands on the BSE, followed by infrastructure firm - Housing Development & Infrastructure (1.59 crore shares), Essar Group firm - Essar Oil (0.57 crore shares), industrial finance company - IFCI (0.45 crore shares) and a financial services - Indiabulls Financial Services (0.43 crore shares).

Global signals

The European markets traded in the negative territory, as investors awaited the outcome of G-20 financial leaders in South Korea. However, strong earnings gave some support to the markets.

The major Asian indices shut mixed. Indices like Shanghai Composite, Hang Seng and Straits Times closed in the red zone, while Nikkei, Jakarta Composite and Kospi closed in the green zone.

The US stock index futures point to a marginally lower opening on the Wall Street ahead of the G-20 meeting. Earnings of Verizon Communications, Honeywell and Schlumberger will be in focus.