Sensex ends 158 pts; Re test 61/$, midcap & smallcap gain

Moneycontrol Bureau
Live Market Commentary

4:00 pm Market closing: Combination of short covering and robust trade led to a good day for market today. The Sensex nearly scored a double century in intra-day trade before closing with gains of over 150 points, ending at 18946.98 while the Nifty was up 46.75 points at 5612.40. About 1438 shares have advanced, 815 shares declined, and 124 shares are unchanged.

The rally was led well by the beaten down metals pack which continued last week's short covering. HDFC had a strong showing after Morgan Stanley said the recent NHB move on lowering risk weights will have a positive impact.

Sun Pharma gained 7 percent on strong earnings and FMCG stocks came back in radar after stunning performance from Britannia. The stock rallied in trade and had a rub-off effect on ITC and HUL in trade today. The midcaps outperformed with an advance/decline ratio of 3:1. GVK and Aurobindo Pharma were the major gainers.

3:50 pm Govt move to check rupee: The government will ask state-run oil producers to raise more funds through external commercial borrowings, Finance Minister P Chidambaram said, as the government tried to sooth investor nerves about a sharp fall in the value of the rupee.

3:40 pm Sebi move: Listed public sector companies have sold shares worth over Rs 2,500 crore to comply with minimum public shareholding norms for which the deadline ended last week, a report said today.

Capital market regulator Securities and Exchange Board of India (Sebi) norms required all state-run companies to have at least 10 percent public shareholding by August 8.

Till June 30, as many as 16 public sector companies were required to meet Sebi's minimum public shareholding norms.

3:30 pm Market outlook: From the beginning of the year itself, Sandeep Shenoy of Anand Rathi Financial Services was of the view that 5600-6100 would be the trading zone for the market to move in before the traction from earning could come and lend support. The next uptick for the market would emerge from Q2 earnings which is three months away, he adds.

According to him, the metal space will continue to remain an underperformer for sometime now. NMDC and MOIL might be looking good, but other major players such as Tata Steel or JSPL are not yet out of the woods, he says.

In the pharma space, Shenoy says Sun Pharma is the Tata Consultancy Services (TCS) of the pharma industry. The traction in earning is so humungous that this stock has reached a scale of its own, he says.

3:20 pm Earnings: Marico beats the street estimates on every parameter except total income during April-June quarter. Consolidated net profit grew by 27.4 percent on yearly basis to Rs 157.7 crore in first quarter.

Total income rose by 8.8 percent year-on-year to Rs 1,382 crore in June quarter from Rs 1,270.3 crore in a year ago period, which was slightly below expectations.

Analysts on an average had expected FMCG major to report net profit of Rs 135 crore on total income of Rs 1,397 crore.

Don't miss: Analysts raise Sun Pharma FY14 estimates post Q1 results

The market pares gains in the last trading hour. The Sensex is up 147.37 points at 18936.71 while the Nifty is up 43.20 points at 5608.85.  About 1443 shares have advanced, 796 shares declined, and 131 shares are unchanged.

HDFC shares rallied nearly 5 percent, while ONGC , ahead of its earnings, rose more than 2 percent.

Tech Mahindra rose more than 2 percent after higher-than-expected earnings during April-June quarter. The company also increased FII investment limit to 45 from 35 percent.

State Bank of India's ( SBI ) June quarter numbers disappointed the street with the bad loans surging by 19 percent over the previous quarter. Shares fell more than 3 percent as analysts see further downgrades.