Sensex slips 100 pts; Axis Bank, ITC, Reliance decline

Moneycontrol BureauLive Market Commentary

10:50am Zuari keen to exit MCF by February

Saroj Poddar-promoted Zuari Fertilizers and Chemicals has extended his decision to wait out till February before exiting Vijay Mallya’s Mangalore Chemicals and Fertilizers, sources told CNBC-TV18. In an interview to CNBC-TV18 last month, Poddar had indicated that his deadline to exit MCF would end in December.

Zuari Fertilizers raised its stake in MCF to 16.4 percent after rival Deepak Fertilizers shored up its stake to sub 25 percent in July.  In the last one year, Poddar has repeatedly said he was willing to sell Zuari's stake in MCF to Mallya but a lack of response from the latter prompted Poddar to set a deadline after which he was free to sell the shares to the highest bidder.

Meanwhile, it is understood that Mallya, who had announced his desire to buy back the holdings of Saroj Poddar, may not have the funds to do so. Deepak Fertilizers has long been wanting to buyout the Zuari stake in MCF, and sources say, it now readying funds for the same.

On December 26, Poddar resigned from Gillette India board to comply with Securities and Exchange Board of India’s (Sebi’s) public shareholding norms. He continues to be chairman of Zuari Agro.

10:40am MCX-SX talks to CNBC-TV18

The board of MCX-SX would decide whether it would allow Financial Technologies to subscribe to its rights issue, MCX Vice Chairman Thomas Matthew said.

MCX-SX, India’s third national stock exchange run by MCX, is looking to raise Rs 500-600 crore via the rights issue, Matthew told CNBC-TV18.

Financial Technologies, the anchor investor of MCX, is under fire for Rs 5,500 crore payment default at its subsidiary National Spot Exchange.

In the wake of the scandal, commodity derivates regulator Forward Markets Commission has ordered FT to cut its stake in MCX while markets regulator Securities and Exchange Board of India has been reportedly mulling a similar decision with regards to MCX-SX.

The stock exchange is owned about 90 percent by public sector banks and financial institutions, Thomas, however, said.

10:30am Market Expert

Tirthankar Patnaik of Religare Capital believes the market performance in 2014 will be a 3G story of general elections, growth and inflation, and global backdrop. "While politics and QE3 remain relevant, it's inflation that will drive market," he adds.

He values the market at 14x FY16 earnings to arrive at a March 2015 Sensex target of 22,500. "Top large-caps picks include Infosys, Tech Mahindra, Sun Pharma, Lupin and Maruti," he says.

10:20am Wockhardt gains ground

Shares of Wockhardt jumped over 5 percent intraday today as reports indicate that US regulator may visit its unit in Shendra for an inspection this month.

“If the company manages to get a go-ahead from the regulator for this plant in Aurangabad district of Maharashtra, it might result in resumption of supplies of several of their products, barred from the US last year,” the report said.

The pharma company ran into trouble with US FDA on violation of various norms in its manufacturing units.  Its plants in Waluj, Chikalthana and Daman are under scanner.

Most Indian firms, which make nearly 40 percent of generic and over-the-counter drugs for the US market, are facing more regulatory woes. The stock was up 3.2 percent.

10:10am MCX in focus

Shares of Multi Commodity Exchange of India (MCX) gained as much as 2.5 percent in morning trade after Blackstone raised its stake in the company through block deal.

Blackstone GPV Capital Partners (Mauritius) VI FII increased stake in MCX by 2.79 percent stake to 4.79 percent from 2 percent on Monday. The firm purchased 14,22,245 equity shares at Rs 573 apiece via block deal that was worth Rs 81.5 crore.

Blackstone now is the largest non-promoter shareholder in MCX after IFCI and AGINYX Enterprises.

Forward Markets Commission (FMC) on December 18 had given approval to Blackstone GPV Capital to increase its stake in MCX upto 4.99 percent through secondary market transaction.

However, Merrill Lynch Holdings (Mauritius) offloaded its complete stake in the company. As on September 30, the firm was holding 2.79 percent in MCX.

10:00am The market wiped out early gains amid volatility on Tuesday as investors looked cautious ahead of third quarter earnings and November industrial output data.

The Sensex fell 134.13 points to 20,653.17, and the Nifty declined 41.25 points to 6,150.20, but the broader markets outperformed benchmarks.

The BSE Smallcap gained 0.3 percent as advancing shares outnumbered declining ones by a ratio of 814 to 702 on the BSE.

Banks are under pressure. Shares of Axis Bank fell the most among largecaps in the Sensex, losing 3 percent. Country's largest lenders State Bank of India, ICICI Bank and HDFC Bank dropped between 0.6-1.2 percent.

Shares of Reliance Industries, ITC, HDFC, Tata Motors, Infosys, TCS and Hindustan Unilever declined 0.5-0.9 percent. Wipro and ONGC dropped 1.6 percent each.

However, Maruti Suzuki bucked the trend with more than a percent gain. Dr Reddy's Labs and Sun Pharma too outperformed with marginal gains.