Nifty tad below 6k in volatile trade

The Nifty ends the volatile session on a positive note, however, the index was unable to hold 6000 levels at the close

Major headlines

Food inflation eases to 10.3%

Patni Computer Systems bags contract from 2e2; the stock ends 0.50% lower

Sun Pharmaceutical Industries gets nod for Clarinex, Diltiazem ER; the stock closes 0.80% down



Indian indices

Domestic markets ended the volatile session on a positive note, rebounding from its steepest drop in five months. The Nifty tried a lot to get back above the crucial psychological levels of 6000 but closed a tad below those levels. Supportive global cues and a dip in food inflation to 10.3% for the week ended November 06, 2010 as compared to 12.3% seen in the previous week helped the markets to post modest gains.

Buying was seen in metal, auto, capital goods and pharma stocks. Selling was seen in banking and realty stocks. The broader markets have underperformed in today's trade. BSE Small-cap index shed more than 1.3%. Top gainers on the BSE Mid-cap - KGN Industries, Den Networks, Cox & Kings, Jet Airways and Bata India were up in the range of 3-7%. Top losers on the BSE Mid-cap - Indiabulls, MVL, Kwality Dairy, J&K Bank and Ruchi Soya were down in the range of 4-7%.

Sterlite Industries - the nation’s largest copper and zinc producer - gained the most in a week. Hindalco Industries - the biggest aluminum producer - surged by 4.3%. Jaiprakash Associates - a builder of dams, roads and bridges - advanced for the first time in five days. India’s main stock gauge is on course to double as spending on infrastructure such as roads and airports sustains economic growth, according to CLSA Asia- Pacific Markets.

Tracking supportive Asian markets, the Sensex began the session 133 points higher at 19998. In initial trade, the index hit the day’s high of 20056. The Sensex started to trim gains from the highest level and slipped into the negative zone in the morning session to touch the day’s low of 19616. However, from the day’s low, the index gradually erased losses and turned positive in the afternoon trade. The index for most part of the day gyrated between gains and losses. The Sensex remained volatile and ended the session with modest gains.

At the closing bell, the Sensex closed at 19931, higher by 66 points. The Nifty ended at 5999, up by 10 points.

Bonds and Rupee update: Investors in the bond market are going to watch out for the auction tomorrow. Yields could be marginally higher on tight liquidity conditions. India’s rupee fell for the fifth day, its longest losing streak since May, to the lowest level in almost eight weeks on speculation the nation’s trade deficit will widen.

Market sentiment

The market breadth was negative as declining stocks outnumbered the rising ones. Of the 3,085 stocks on the BSE, 1,893 fell while 1,052 gained. Hundred and forty stocks remained unchanged.

Sectoral and stock screening

Out of the 13 sectoral indices - seven sectors closed in the green, while six in the red. BSE Metal was the outperformer, gained by 1.89%, followed by BSE Auto that rose by 1.40% and BSE Health Care (HC) surged by 0.97%. The BSE Bankex was the top loser, fell by 1.60% amidst the fear that microfinance sector would take its toll on it. BSE Consumer Durables (CD) dipped by 1.42% and BSE Realty lost by 0.77%.

Among 'A' group stocks, the top three gainers were - Hero Honda rose by 5.46% after the leading brokerage house Credit Suisse upgraded the stock to outperform from neutral. Hindalco Industries up by 4.86% on reports Novelis Inc, a unit of Hindalco Industries, plans to raise $4 billion to refinance the loans borrowed by Hindalco in 2007 for acquisition of Novelis. Cipla gained by 4.38%.

The top three losers were - Indiabulls Financial Services lost by 6.63%. Reliance Communications fell by 4.88% after CAG accused the company for having improper holding in rival mobile network, Swan Telecom. DB Realty declined by 4.83%.

Viewing volumes

India’s second largest developer - Unitech was traded the most, with over 1.06 crore shares changing hands on the BSE, followed by industrial finance company - IFCI (1.02 crore shares), Anil Dhirubhai Ambani Group firm - Reliance Communications (0.45 crore shares), wind turbine major - Suzlon Energy (0.43 crore shares) and public sector bank - IDBI Bank (0.34 crore shares).

Global signals

European equities climbed for a second straight day on optimism that Ireland's move to work with a EU-IMF mission on urgent steps to help its banking sector, could lead to a solution to its debt crisis.

The major Asian indices closed in the positive terrain except Jakarta Composite and Straits Times. Japan’s Nikkei index surged over 2%.

The US stock index futures point to a higher opening on the Wall Street. The investors will keep an eye on the Jobless claims and Philadelphia Fed business outlook.

Market Outlook: We have Jobless Claims and Philadelphia Federal Reserve’s Business Outlook data in the US tonight.