Volatile session ends on a strong note

The Indian markets closed the volatile session on a strong note owing to heavy buying in realty, metal, power, capital goods and PSU stocks

Major headlines

Emami loses Paras Pharma bid; the stock ends 16.65% higher

Sintex Industries to buy stake in Durha Constructions; the stock closes up by 4.04%

JSW Steel to issue GDRs to JFE Steel; the stock ends 8.22% higher



Indian indices

The Indian markets witnessed volatility since its initial trade in today's session. Though, a late recovery helped the markets to end the session on a strong note. Realty stocks led the rally for markets in trade today. Heavy buying was also seen in power, metal, capital goods and PSU stocks. Positive European markets also led to some support. It seems that the Nifty has found a good support around 5700 mark at the moment.

The broader markets outperformed largecaps in terms of recovery today. BSE Midcap and BSE Smallcap were up by 1.77% and 2.05% respectively. Top gainers on the BSE Mid-cap: Sunteck Realty, S Kumars Nationwide, Emami, Dewan Housing and KS Oils rose by 11-19%. Top losers on the BSE Midcap: Sterling International, Money Matters Financial, GlaxoSmith Consumer, United Phosphorous and Eicher Motors were down by 2-9%.

In the largecap space, Reliance Infrastructure, Housing Development Finance Corporation, DLF, Hindalco Industries, Bharat Heavy Electricals and Siemens were up by 2.7-3.7%. ITC, Mahindra and Mahindra, Hero Honda, Bharti Airtel, Wipro, Ambuja Cements, ACC and Ranbaxy Laboratories were down by 0.4-2.7%.

Tracking supportive Asian markets, the Sensex began the session 91 points higher at 19600. The Sensex started to witness volatility and erased its initial gains, hitting the day’s low of 19321 in the morning session. In the afternoon trade, the Sensex started to trim its losses and traded higher after sentiments in the European markets turned bullish. The index extended gains, hitting the day’s high of 19710 in late trade on account of heavy buying in realty, metal and power stocks.

At the finishing line, the Sensex rose 183 points to close at 19692 and the Nifty shut at 5908, advancing by 50 points.

Bond and Rupee update: India’s 12-year bonds declined, halting a two-day gain, on speculation investors will sell debt to cope with a shortage of cash in the banking system. The yield on the 8.13% note due September 2022 rose two basis points to 8.13% from 8.11% on Friday (December 10, 2010) evening. The price fell by 0.13, or 13 paise per Rs100 face amount, to 99.95. India’s rupee weakened for the third time in four days on speculation the nation’s refiners will step up dollar purchases to pay for costlier crude-oil imports. The Indian currency slid 0.2% to 45.155 per dollar .The currency is still up 1.6% this month and touched 44.39 on December 07, the strongest level since November 12.

Market sentiment

The market breadth was strong for the second straight session as rising stocks outnumbered the gaining ones over two times. Of the 3,016 stocks traded on the BSE, 1,969 advanced while 860 declined. Hundred and sixty-seven stocks remained unchanged.

Sectoral & stock screening

All the 13 sectoral indices ended in the positive territory barring BSE Fast Moving Consumer Goods (FMCG) that ended marginally lower by 0.13%. BSE Realty was the top performer, rose by 2.79%, followed by BSE Metal up by 2.10% and BSE Power advanced by 2.09%. Rest of the sectors ended the session higher in the range of 0.17-1.68%.

Among 'A' group stocks, JSW Steel was the major gainer, surged by 8.22%, followed by Pantaloon Retails up by 7.39% and GVK Power & Infrastructure gained by 7.07%. Among losers, United Phosphorus slid the most by 4.16%, followed by Ambuja Cement down by 2.47% and Ultratech Cement declined by 2.34%.

Viewing volumes

Industrial finance company - IFCI was the most traded, with over 0.56 crore shares changing hands on the BSE, followed by wind turbine major - Suzlon Energy (0.45 crore shares), India’s second largest developer - Unitech (0.31 crore shares), government fertilizers firm – Rashtriya Chemicals & Fertlizers (0.30 crore shares) and hydro power firm - NHPC (0.27 crore shares).

Global signals

European shares rose for a sixth straight session as upbeat US and Chinese data boosted investors' risk appetite and on hopes that Beijing may not raise interest rates anytime soon.

The major Asian indices closed in the positive territory except Jakarta Composite and Straits Times. China’s Shanghai Composite index gained 2.88%.

The US stock index futures point to a flat opening on the Wall Street.

Market Outlook: We have no major data in the US tonight.