Nifty slips below 6200; Wipro loses 6%, SBI & GAIL up 3%

Moneycontrol Bureau
Live Market Commentary

10:50am Stocks In News

GAIL gained 3 percent as reports suggest that oil ministry decides to exempt GAIL from sharing oil subsidy because it does not make windfall profits from crude and gas price spikes.

ACC and Ambuja Cements are both down over 1 percent ahead of their results as lower realisations and higher input costs will result in lower margins. A CNBC-TV18 poll expects ACC to deliver a net profit which is lower by 28 percent while Ambuja's net profit is seen lower by 31 percent. 

Sesa Sterlite rallied 2.5 percent on hopes of some relaxation of the mining and transportation bans of iron ore currently prevailing in Goa as the SC continues hearing this mining case today.

Gujarat Pipavav surged 8 percent as the company reported good earnings with net profit up 60 percent Y-o-Y. Macquarie has an outperform rating on the stock and upped target price to Rs 64 versus earlier Rs 59. The brokerage house says earnings upgrade cycle is starting and the company is trading at compelling valuation.

Jubilant Lifesciences gained 5.5 percent as reports indicated that the company may soon list itself on NYSE and is looking to raise USD 150-200 million through IPO.

10:35am Market Expert

Amisha Vora, joint MD, Prabhudas Lilladher believes the Reserve Bank of India policy on October 29 will keep the market volatile as that will not only entail a repo rate hike but will also keep monetary policy and money supply tight.

Vora expects slightly rural oriented companies like autos and within autos two-wheelers or stocks like Mahindra Finance to do better going ahead. However, she adds that in the last two years financials were leading the rally but for the next three-six months, in case market has the potential to rally, financials are unlikely to lead the rally.

Also Read: Period of good results over; more mkt uptick unlikely: HSBC

10:16am Equity benchmarks declined amid choppy trade on Wednesday, but the broader markets continued to outperform benchmarks for the third consecutive session.

The Sensex is down 71.27 points at 20793.70, and the Nifty is down 21.95 points at 6180.85 while the BSE Midcap and Smallcap indices gained 0.45 percent each. Two shares advanced for every share declined on the Bombay Stock Exchange.

The market is consistently getting supported by foreign money especially after deferment of Fed tapering, that is why it has been holding its three-year high. Foreign institutional investors have bought nearly Rs 11,000 crore worth of shares in October so far, in addition to Rs 12,632.90 crore worth of buying in September.

The recent rally in Indian equity market is all thanks to Fed deferring quantitative easing (QE3) and a global markets rally, says Jitendra Sriram, managing director and head of research, HSBC India.

However, this rally is unlikely to continue adds Sriram. “I am still quite cautious on the market. I do not think there is more upside to this market into this year-end at least. I still think that the market needs some time for earnings to catch up before it can form some higher base from hereon,” he highlights.

State Bank of India gained 2.6 percent as banking secretary on Tuesday said additional capital infusion in PSU banks will take place by March. SBI chairperson will also take decision on QIP within a month.

Sesa Sterlite and GAIL rallied 2.5-3 percent while Hero Motocorp gained 0.25 percent ahead of second quarter numbers today. According to a CNBC-TV18 poll, analysts expect an unimpressive performance during the quarter, growth will be marginal given the slowdown in the sector.

However, Wipro is the major loser, falling nearly 6 percent post September quarter earnings that were in-line with analysts' expectations. The stock seems to have discounted earnings.

TCS and Infosys too are under pressure, losing 1.4 percent on profit booking.