Volatile Sensex trades higher; Reliance leads

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The market continued to trade flat after hitting a six-month high by crossing the 5400 mark. It seemed to be in a consolidation mode after a rally in the previous five sessions. Banks, auto (two-wheeler) stocks, and Reliance and TCS were supporting the market while capital goods stocks, and Bharti, HDFC and ONGC limited the upside. The Sensex was up 50 points at 17,757 and the Nifty rose 14 points to 5,375.45.

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Sushil Kedia, president at ATMA says that the market is clearly overbought and the RSI (relative strength index) is now making a lower high while the underlying prices continue to make a higher high. "That becomes a warning signal for this rally to gear on, lose momentum and a change in trend is anticipated to begin anytime now," he says.

He says that another 100 pts upmove is warranted, but a correction is likely within the next four-five days.

Index heavyweight Reliance Industries was quite supportive for the market, rising 1.8% as sources claimed that the company declined to withdraw arbitration against government.

Among banks, HDFC Bank and ICICI Bank gained 0.6%; SBI rose 0.3%.

Shares of ITC, TCS, Tata Motors, Jindal Steel, Hero Motocorp, Bajaj Auto, Wipro, Cipla and Coal India among other largecaps climbed 0.7-1.5%.

However, shares of Bharti Airtel and HUL fell nearly 2%. L&T and Infosys were marginally lower.

HDFC, M&M (ahead of results today), Sun Pharma, ONGC, GAIL, NTPC, BHEL and DLF slipped 0.4-1%.

Market breadth was slightly positive; about 1188 shares advanced while 951 shares declined on the BSE.

At 9:19 hours IST : Nifty turns flat after hitting 5400 in early trade

The Nifty touched the 5,400 mark - first time since August 4, 2011 - in the early trade, while the Sensex added more than 100 points. However, the market could not hold those gains for long due to profit booking and immediately turned flat with positive bias. Though Greece missed another deadline for debt deal, global markets were mixed.

The Sensex was up 41 points at 17,748.08 and the Nifty rose 8 points to 5,369.45.

Frontliners like Sesa Goa, Hindalco, SAIL, Jindal Steel, JP Associates, TCS, ICICI Bank, SBI, HDFC Bank, PNB and Coal India were supporting the market.

However, ONGC, BPCL, HUL, Bharti, L&T and ACC were under pressure in the early trade.

The market breadth was 4:1 on the National Stock Exchange.

In the second line shares, Voltas, S Kumars Nationwide, Orchid Chemical, IOB, JK Lakshmi Cement, Shree Renuka Sugars, SKS Microfinance, Dena Bank, India Cements, VIP Industries (ahead of Q3 numbers today) gained 1.5-3%.

Results Reactions: BGR Energy fell 2%. NCC tanked 5% as company reported consolidated loss of Rs 10.3 crore in Q3 versus profit of Rs 52 crore YoY. Adani Power continued to fall, it was down 3%.

India Infoline was down 3% on profit booking; the stock had rallied 22% yesterday on excellent results.

Manappuram Finance lost 17%. The RBI says that the company is not permitted to accept/renew deposits from public.

However, KRBL was up 6.5% ahead of EGOM meet.