Sensex, Nifty in red; auto stocks fall, pharma & oil up

Moneycontrol Bureau11:55 am Boardroom: In an interview to CNBC-TV18, Sudhakar Ram, MD & Group CEO of Mastek spoke about the results and his outlook for the company.He said, "The growth could have been better in terms of our expectations but on some projects it was the right shift. Going forward, we do expect the growth rates to pick up. We do see quarter-on-quarter improvement over the next 3-4 quarters, in terms of topline and definitely it should translate to better bottom-line".

Talking about margin improvement, he further mentioned, "The troubled program has pretty much been resolved and it will now take on a more profitable execution path going forward. We have also had improvements in terms of SG&A leverage, SG&A effectiveness that in terms of the overheads as well as sales and marketing, we have taken a tighter look at it to ensure that it is in line with our current revenue projections. Both of those have led to margin improvements in this quarter and they will continue to yield better margins going forward".

11:45 am Gold: Gold prices softened by 0.12 percent to Rs 29,870 per 10 gram in futures trading as traders trimmed their bets amid weak global cues.

At Multi Commodity Exchange, gold for delivery in February next year declined by Rs 35 or 0.12 percent to Rs 29,870 per ten gram in business turnover of 7 lots.

Likewise, the metal for delivery in December contracts was trading lower by Rs 19 or 0.06 percent to Rs 29,767 per ten gram in 322 lots.

Analysts said cutting down of positions by participants, tracking a weak trend in global markets weighed on gold prices in futures trade here.

Meanwhile, gold fell 0.07 percent to USD 1,261.30 an ounce in Singapore.

11:30 am COAI: Cellular operators' association COAI has asked the telecom regulator TRAI to defer the review of interconnect usage charges -- paid by one telecom operator to another for connecting phone calls -- till March 2017.

In its written response to TRAI's contentious consultation paper on interconnection usage charges or IUC, the association said that the regulator has initiated various other consultations which depending upon their final outcomes "may have a significant direct impact on cost structures, changes in technology and other market dynamics." "It is therefore critical that the IUC review should not be held at this stage and be deferred by some months, that is, after end March 2017...By such time there will be more clarity on several issues," COAI said in its latest submission to TRAI.

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The market is under pressure as the Sensex is down 56.94 points or 0.2 percent at 27993.94. The Nifty is down 13.40 points or 0.1 percent at 8664.50. About 1456 shares have advanced, 868 shares declined, and 146 shares are unchanged.

BHEL, GAIL, Wipro, Sun Pharma and Lupin are top gainers while ITC, ICICI, M&M, Hero and Tata Motors are losers in the Sensex.

Consumer demand in the three months to November is likely to be meaningfully better than the corresponding period of last year on account of abundant provisioning for loans and consumer appetite for purchasing goods, said Saurabh Mukherjea of Ambit Capital Investments.

He, however, adds that while consumer demand isn’t a worry, softening investment demand over the past 3-4 months is a concern.

Mukherjea said that IT sector is challenged from a top line growth perspective. The mismatch between elevated PE multiples and modest EPS is unlikely to abate in the near term, he said.