Sensex choppy, Bank Nifty up; RBI hikes repo rate by 25 bps

Moneycontrol Bureau
Live Market Commentary

11:50 am Market outlook: Dhiraj Agarwal of Standard Chartered Securities see the market even touching 6300 in the next six months. Given the current economic scenario, he cautions that risk in the market is much higher than returns and the macro data still continues to point on the downside.

On his preferered stocks, Agarwal is bullish on Maruti Suzuki, but adds that it is more of a stock play than a sectoral play.

11:40 am Results poll: FMCG major Marico will announce its second quarter (July-September) results today. According to a CNBC-TV18 poll, analysts on an average expect consolidated profit after tax of the company to grow 26.5 percent year-on-year to Rs 109 crore during the quarter.

Total income is seen going up by 10 percent to Rs 1,276 crore in three months period ended September 2013 from Rs 1,159 crore in a year ago period. Volume growth, which is the key for any FMCG company, is expected to largely remain sluggish in the quarter gone by.

11:30 am Reaction to RBI policy: Saying that the RBI credit policy is along expected lines, Prime Minister's economic advisory council chairman C Rangarajan, feels that repo hike indicates inflation may continue to remain high. In an interview to CNBC-TV18 he says,"Further actions on repo rate will depend on inflation movement."

According to Rangarajan, WPI inflation is likely to be in the range of 5.5-6 percent. "What is coming out is a slightly elevated level of interest rate because the MSF rate will also go up as compared to what it was in July," he adds.

11:25 am Bank Nifty: Banks are gaining investors' confidence taking the Bank Nifty up over 1 percent. SBI, Axis Bank,ICICI Bank rise 1-3 percent.

11:15 am Movers and losers: Besides banking stocks, metals, auto and consumer durables are up while capital goods and FMCG stocks are reeling under selling pressure.

11:10 am Market check: After rising around 100 points, the market has gone flat again. The Sensex is up 12.85 points at 20583.13, and the Nifty is up 7.45 points at 6108.55. About 710 shares have advanced, 969 shares declined, and 95 shares are unchanged.

Maruti Suzuki is still up over 6 percent on the BSE.

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The market is still flat. The Reserve Bank of India has cut repo rate by 25 basis points (bps) to 7.75 percent in the second quarter monetary policy review. The central bank also cut marginal standing facility (MSF) rate by 25 bps to 8.75 percent and left cash reserve ratio (CRR) unchanged.

The Sensex is up 4.47 points at 20574.75, and the Nifty up 6.55 points at 6107.65. About 666 shares have advanced, 1001 shares declined, and 94 shares are unchanged.

Maruti, ICICI Bank, Sun Pharma, Hero Motocorp, Sesa Sterlite are top gainers in the Sensex. Among the laggards are BHEL, L&T, ITC, Bharti Airtel and NTPC.

Gold gained for a fourth session, edging closer to a five-week high, as weak US economic data boosted views the Federal Reserve would maintain its stimulus measures, burnishing the metal's appeal as an inflation-hedge, reports Reuters.

The Fed begins a two-day policy meeting on Tuesday in which it is widely expected to confirm it will continue buying bonds at an USD 85 billion monthly pace.

Gold prices have fallen nearly 20 percent this year on fears the Fed could begin tapering its stimulus programme, but a budget battle in Washington and a string of weak economic data have raised questions over whether the bank would scale back, giving bullion a boost.