Sensex, Nifty at over one-week closing lows

Key benchmark indices fell for the second straight day to reach their lowest closing level in more than a week as profit booking emerged after recent strong rally in share prices. Volatility was high as traders rolled over positions in futures & options (F&O) segment from the near-month February 2012 series to March 2012 series. The February 2012 F&O contracts expired today, 23 February 2012. The barometer index, BSE Sensex, lost 66.75 points or 0.37%, off about 170 points from the day's high and up close to 35 points from the day's low. The market breadth was weak.

The Sensex has jumped 884.95 points or 5.14% in February 2012 so far. The barometer index has surged 2,623.58 points or 16.97% in calendar 2012 so far. From a 52-week low of 15,135.86 on 20 December 2011, the Sensex has risen 2942.64 points or 19.44%. From a 52-week high of 19,811.14 on 6 April 2011, the Sensex has lost 1,732.64 points or 8.74%.



Coming back to today's trade, index heavyweight Reliance Industries (RIL) edged higher in volatile trade. FMCG stocks rose on defensive buying. Realty, auto and metal stocks edged lower on profit taking after recent strong gains. ABB gained after strong Q4 results. Ranbaxy Laboratories gained after the company's Q4 EBIDTA surged. IT major TCS hit record high.

The 50-unit S&P CNX Nifty hit one-week low amid initial volatility. Key benchmark indices edged lower after alternately swinging between positive and negative terrain in morning trade. The market trimmed losses after hitting one-week low in mid-morning trade. The market extended losses to hit fresh one-week low in early afternoon trade. The market reversed direction and moved into positive zone in mid-afternoon trade. The market once again slipped into the red in late trade.

The BSE Sensex shed 66.75 points or 0.37% to settle at 18,078.50, its lowest closing level since 14 February 2012. The index rose 104.28 points at the day's high of 18,249.53 in mid-afternoon trade. The index fell 140 points at the day's low of 18,005.28 in afternoon trade.

The S&P CNX Nifty shed 22.05 points or 0.4% to settle at 5,483.30, its lowest level since 14 February 2012. The index hit a low of 5,460.80 and a high of 5,537.40 in intraday trade.

The BSE Mid-Cap fell 0.55% and the BSE Small-Cap index declined 0.91%. Both these indices underperformed the Sensex.

BSE clocked turnover of Rs 3212 crore, lower than Rs 3852.67 crore on Wednesday, 22 February 2012.

The market breadth, indicating the overall health of the market, was weak. On BSE, 1,786 shares fell and 1,092 shares rose. A total of 108 shares were unchanged.

Among the 30-share Sensex pack, 18 fell while rest of them rose.

Index heavyweight Reliance Industries (RIL) rose 0.59% to Rs 838.10. The stock was volatile. The stock hit a high of Rs 847.90 and a low of Rs 829. The company said after market hours on Tuesday, 21 February 2012, that it has agreed to form a joint venture with Russian petrochemical company SIBUR to make 100,000 metric tonnes of butyl rubber a year in Jamnagar in Gujarat. RIL will own a 74.9% stake in the joint venture, which will be named Reliance Sibur Elastomers. SIBUR will hold the remaining 25.1% stake. The joint venture will invest $450 million to build the facility, which is expected to be commissioned by the middle of 2014.

The JV will cater to the demand for synthetic rubber from the Indian automotive industry of over 75,000 tonnes per year, which is currently satisfied by imports. Investment in the JV is in line with RIL's vision of emerging as a significant player in the global synthetic rubber market, RIL said in a statement.

Auto stocks slipped for the second straight day on profit taking. India's largest car maker by sales Maruti Suzuki India declined 2.09%.

India's largest motorcycle maker by sales Hero MotoCorp declined 2.68%. The company said after trading hours on Wednesday, 22 February 2012, that it has entered into a partnership with US-based motorcycle company Erik Buell Racing (EBR). As part of the partnership, Hero MotoCorp will receive support in terms of technology and design to develop future models from EBR -- the East Troy, Wisconsin-based firm, which specializes in designing and manufacturing powerful and high-speed motorcycles. Hero MotoCorp exited a 26-year-long joint venture with Japan's Honda Motor Company in March 2011.

India's second largest motorcycle maker by sales Bajaj Auto fell 0.99% to Rs 1782.95. The stock had hit a record high of Rs 1,838.90 in intraday trade on Wednesday, 22 February 2012.

India's largest utility vehicles maker Mahindra & Mahindra (M&M) shed 2.31%. M&M's consolidated net profit, adjusted for extra-ordinary items, rose 13.2% to Rs 831.80 crore on 27.6% growth in gross revenue and other income to Rs 16488.40 crore in Q3 December 2011 over Q3 December 2010. Mahindra Satyam, Mahindra Finance and Mahindra Forgings led the improved performance of the Mahindra Group in Q3 December 2011. M&M announced the consolidated results during trading hours on Tuesday, 21 February 2012.

India's largest truck maker by sales Tata Motors rose 0.26%, with the stock reversing initial losses.

ABB rose 1.22% after the company announced during market hours today that its profit after tax surged 842.6% to Rs 64.10 crore on 5.8% growth in revenue to Rs 2169.60 crore in Q4 December 2011 over Q4 December 2010. ABB said that the company is well positioned with a strong order backlog of Rs 9128.80 crore as on 31 December 2011, providing necessary visibility to future revenues.

Ranbaxy Laboratories gained 0.25%. The company announced during market hours today that its consolidated net loss widened to Rs 2982.76 crore in Q4 December 2011 compared with a net loss of Rs 97.48 crore in Q4 December 2010. Ranbaxy said extra-ordinary items impacted the performance in Q4 December 2011. Earnings before interest, tax, depreciation and amortization (EBITDA) was 25% of sales at Rs 954.80 crore in Q4 December 2011. Consolidated sales rose 79.04% to Rs 3743.30 crore in Q4 December 2011 over in Q4 December 2010.

Commenting on the business results, Arun Sawhney, Chief Executive Officer & Managing Director, Ranbaxy, said, "I am delighted to share with you that Ranbaxy is the first pharma company of Indian origin to have surpassed sales of $2 billion. We successfully launched our Atorvastatin, generic Lipitor in the US. I am satisfied with the progress we are making in resolving the long standing issues with the US regulators. The settlement with the US FDA and provision for eventual penalties that the DOJ may levy, brings greater predictability to our business in the US, one of our largest markets."

FMCG stocks rose on defensive buying. ITC, United Spirits, Dabur India and Hindustan Unilever rose by between 0.12% to 3.88%.

Metal stocks fell on profit booking. Jindal Steel & Power, JSW Steel, Sail, Hindustan Zinc, and Hindalco Industries fell by between 0.65% to 3.46%. Tata Steel rose 0.22%, with the stock reversing intraday losses.

Sterlite Industries (India) fell 4.09%, with the stock extending Wednesday's 6.62% slide. As per media reports, the Vedanta Resources group may merge iron ore firm Sesa Goa with copper and aluminium maker Sterlite Industries to simplify and consolidate its corporate structure.

Sesa Goa fell 3.7%, with the stock extending Wednesday's 4.18% losses. Referring to media reports suggesting that the Income Tax Department had frozen Sesa Goa's bank accounts, the company clarified that at present none of its accounts have been frozen. The company said that the income tax department had demanded Rs 246 crore, disallowing certain claims of the company in December 2011 during regular assessment proceedings. However, the company said it has been legally advised that the case is strong from the company's side and accordingly no provision has been made against those demands. The company will take all necessary legal steps in normal course to quash these demands, it added. The announcement was made during trading hours today, 23 February 2012.

Realty stocks edged lower on profit taking after recent strong gains. DLF, Phoenix Mills, HDIL and Unitech dropped by between 1.08% to 6.17%. From a recent low of 1370.23 on 2 January 2012, the BSE Realty index jumped 47.64% to 2023.10 on 22 February 2012.

Bank stocks were mixed. India's largest private sector bank by branch network ICICI Bank declined 1.39%, with the stock extending Wednesday's 3.42% losses.

India's second largest bank by net profit HDFC Bank was flat at Rs 531.80. The stock hit a record high of Rs 538.85 in intraday trade on Wednesday, 22 February 2012.

State Bank of India rose 0.15% after the bank's deputy managing director, R. Venkatachalam, denied media reports that the bank was close to offering a bailout loan package to Kingfisher Airlines. Shares of State Bank of India (SBI) had slumped 7.91% on Wednesday, 22 February 2012, after media reported that the bank has extended a Rs 1200 crore relief package to cash-strapped Kingfisher Airlines, including working capital of Rs 400 crore, bank guarantee of Rs 500 crore and loan repayment extension worth Rs 250-300 crore.

Bank of Baroda fell 0.94%. The bank said after market hours today that a meeting of the board of directors of the bank will be held on 27 February 2012, to consider proposed preferential issue of equity shares in favour of Life Insurance Corporation of India (LIC)/ Mutual Funds (MF).

Punjab National Bank fell 1.96%. The bank said that the board of directors of the bank at its meeting held on 22 February 2012 has approved issuance of up to 1.28 crore equity shares to Government of India and up to 1.58 crore equity shares to LIC on preferential basis, at a premium of Rs 993.69.

PSU OMCs rose on recent reports the prices of auto and cooking fuels are likely to shoot up steeply in the first week of March 2012 once the assembly elections are over. BPCL, HPCL and Indian Oil Corporation rose by between 2.36% to 5.08%. The hike could be Rs 4 per litre for petrol, Rs 3 for diesel and Rs 50 per cylinder for cooking gas.

Oil marketing companies -- Indian Oil, Bharat Petroleum and Hindustan Petroleum -- are currently losing Rs 4 a litre on petrol, Rs 14 on diesel and Rs 390 on every cylinder of liquefied petroleum gas (LPG), report said. Oil marketing companies (PSU OMCs) incur under-recoveries on domestic sale of diesel, LPG and kerosene at controlled prices. The government has already freed pricing of petrol.

IT stocks were mixed. India's second largest software services exporter by revenue Infosys declined 0.6%. India's third largest software services exporter by revenues Wipro fell 1.02%.

India's largest software services exporter by revenue, TCS rose 0.59% to Rs 1259.25. The stock hit a record high of Rs 1,274.75 in intraday trade today, 23 February 2012. The Ministry of External Affairs (MEA), the Government of India in partnership with TCS today, 23 February 2012, announced the launch of citizen-centric Passport Seva Kendras for applications and issuance of passports in the National Capital Territory.

Airline stocks were mixed after the government formally allowed local carriers to import jet fuel directly in a major policy move expected to bring down costs for the debt-laden carriers. Jet Airways fell 1.79%. SpiceJet was flat. Jet fuel is more than 50% costlier in India, compared to the global average, mostly due to local taxes. Jet fuel or aviation turbine fuel (ATF) typically makes up almost half of an airline's operating cost.

Kingfisher Airlines rose 1% after Civil Aviation Minister Ajit Singh said that the Indian government has no plans to cancel the operating license of financially beleaguered Kingfisher Airlines.

Bharti Airtel fell 2.59% on reports South Africa-based Econet Wireless is seeking at least $3.1 billion in damages from the Indian firm in a dispute over ownership of its subsidiary Airtel Nigeria. Bharti acquired the African operations of Kuwaiti company Zain in 2010, including 65% of Zain Nigeria, renamed Airtel Nigeria, but a Nigerian court ruled on 30 January 2012 that its ownership of the unit was "null and void" because co-founder and 5% shareholder Econet had not been consulted on the transfer. Econet reportedly claims its stake was unfairly cancelled when Zain took control in 2005, so any decision made since then without it, including the transfer to Bharti from Zain, is void. The Nigerian court upheld that claim, reports added.

Lanco Infratech clocked highest volume of 2.27 crore shares on BSE. Cals Refineries (1.65 crore shares), Suzlon Energy (82.83 lakh shares), IFCI (71.58 lakh shares) and Unitech (68.52 lakh shares) were the other volume toppers in that order.

SBI clocked highest turnover of Rs 211.25 crore on BSE. ICICI Bank (Rs 85.09 crore), RIL (Rs 70.34 crore), Reliance Capital (Rs 67.58 crore) and HDIL (Rs 59.62 crore) were the other turnover toppers in that order.

Foreign institutional investors (FIIs) bought shares worth a net Rs 829.63 crore on Wednesday, 22 February 2012, as per provisional data from the stock exchanges. FIIs have bought shares worth a net Rs 14379.05 crore in this month so far (22 February 2012), as per provisional data from the stock exchanges. The inflow this month comes on the top of heavy purchases last month. FIIs bought shares worth a net Rs 10357.70 crore in January 2012, as per data from Securities & Exchange Board of India (Sebi).

The government is working with state governments for early implementation of a goods and services tax (GST), Finance Minister Pranab Mukherjee said on Wednesday, 22 February 2012.

India's economy is expected to grow an annual 7.1% in the current financial year that ends in March, and 7.5 to 8% in the next financial year, C. Rangarajan, chairman of Prime Minister Manmohan Singh's economic advisory council said. The economy has lost momentum as euro zone debt woes coupled with high interest rates and policy paralysis at home have hit capital investment. Rangarajan released the document 'Review of the Economy 2011-12' at a Press Conference in New Delhi on Wednesday, 22 February 2012. He said a likely overshoot in fiscal deficit over the budgeted 4.6% of gross domestic product is a matter of concern and the government must lay out a roadmap for fiscal consolidation.

The initial public offer (IPO) of commodity exchange Multi Commodity Exchange of India (MCX) was subscribed 2.26 times by 15:00 IST on the second day of bidding for the IPO today, 23 February 2012. The issue closes tomorrow, 24 February 2012. MCX on Tuesday, 21 February 2012, raised Rs 95.62 crore from 12 anchor investors.

The government said on Tuesday that inflation based on the consumer price index (CPI) rose 7.65% in January 2012. The annual CPI data released for the first time on Tuesday measures retail prices in major food groups, fuel, clothing, housing and education across rural and urban India. The new CPI price series is gradually expected to displace wholesale price data as the primary indicator of inflationary trends.

Finance Minister Pranab Mukherjee will present the annual budget for 2012/13 on 16 March 2012, while the railways budget will be presented on 14 March 2012. The budget session of parliament will start on 12 March 2012. The government will present on March 15 the Economic Survey for 2011/12, a document on the state of economy prepared by the economic division in the ministry of finance. The annual budget is usually presented on the last working day of February. However, the budget has been delayed this time due to the ongoing assembly polls. Polling for assembly elections in five states concludes in early March 2012. The counting of the votes takes place on 6 March 2012, with the results due on the same day.

Reports indicate that the finance ministry is considering a proposal to increase excise duty from 10% to 12%, although still lower than the level before the 2008 financial crisis. The move is aimed at helping the government improve its fiscal situation but it is expected to push up the cost of almost all manufactured goods from food products to consumer durables and automobiles.

European stock markets were mixed on Thursday. Key benchmark indices in France and Germany fell by between 0.08% to 0.32%. UK's FTSE 100 rose 0.21%.

Business confidence in Germany increased more than expected this month to touch a seven-month high, raising optimism about the health of the eurozone's largest economy amid ongoing worries about the credit crisis.

Fitch Ratings on Wednesday cut Greece's sovereign credit rating to C from CCC.

Asian shares fell on Thursday as higher oil prices and weak euro-zone data sparked concerns about global growth. Key benchmark indices in Hong Kong, Indonesia, Singapore, South Korea, and Taiwan fell by between 0.78% to 1.03%. Key benchmark indices in China and Japan rose by between 0.25% to 0.44%.

Trading in US index futures indicated that the Dow could gain 18 points at the opening bell on Thursday, 23 February 2012. US stocks edged lower on Wednesday, bringing a three-session run of gains to an end, after a weak survey of euro-zone manufacturing reminded investors that Europe's troubles haven't ended with this week's aid deal for Greece.