Sensex, Nifty off day's high; Tata Motors, Dr Reddy's up

Moneycontrol Bureau10:45 am Services PMI: Growth of services activity across India softened in September, reflecting a slower rise in new business. Subsequently, companies held workforces broadly unchanged during the month. Furthermore, confidence subsided and was the weakest since data collection began in December 2005. On the price front, survey data highlighted a lack of inflationary pressures as both input costs and output charges fell, Nikkei-Markit report says.

Down from 51.8 in August to 51.3 in September, the seasonally adjusted Nikkei Business Activity Index, pointed to a slight and softer expansion of services output across the country.10:30 am FII View: Anand Kumar, Bank of America Merrill Lynch says despite the recent downgrades, aggregate Sensex earnings expectations for FY16 continue to remain high.

Consensus Sensex EPS growth for FY16 is nearly 17 percent on a bottom-up basis. He expects this to get downgraded to 8-10 percent.

"In-line with his view, sharp downgrades on the back of disappointing result season would likely keep the market performance subdued in the near term," Kumar says.10:15 am Buzzing: Investors have queued up for buying shares of Gujarat NRE Coke on Tuesday after the company decided to sell its windmill business. The stock is locked at 20 percent upper circuit at Rs 3.76 on the Bombay Stock Exchange and there were pending buy orders of 340,271 shares, with no sellers available (at 9:36 hours IST).

"Gujarat NRE has received approval from its shareholders for sale of its 62 wind mills in Gujarat of total wind power energy production capacity of 87.5 MW," the met coke producer says in its filing to exchange.

The company has entered into agreements for sale of wind mill business for Rs 218.75 crore, which is subject to complete due diligence by buyer and approval from all relevant authorities & lenders of company.

These sale proceeds will help in improving cash flows thereby helping in faster revival of company's operations, Arun Kumar Jagatramka, CMD, Gujarat NRE Coke says.Also read - Convinced on PSU banks; see new Nifty peak by Jan: Quantum10:00 am Market CheckThe market erased some early gains, weighed by index heavyweights like HDFC, HDFC Bank, Infosys and Larsen & Toubro. The broader markets marginally outperformed benchmarks with the BSE Midcap and Smallcap indices rising 0.3 percent and 0.7 percent, respectively.

The Sensex gained 57.61 points at 26843.16 and the Nifty rose 6.05 points to 8125.35. The market breadth was positive as about 1246 shares have advanced against 556 shares declined on the Bombay Stock Exchange.

Tata Motors and Dr Reddy's Labs topped the buying list on Sensex, up 2-2.5 percent followed by ITC, Sun Pharma, ONGC, Cipla, Coal India and GAIL with 1-1.5 percent upside.

However, Infosys, HDFC Bank, HDFC, Larsen & Toubro, Maruti Suzuki, Bajaj Auto, Tata Steel and Hindalco Industries saw profit booking, down 0.5-0.9 percent. BHEL lost 1.7 percent.