Sensex ignores RBI move to close 57 pts up, RIL loses 1%

Indian equity benchmarks closed Friday's trade with moderate gains despite key rate hikes and hawkish stance of RBI to maintain anti-inflationary stance. Even the positive global cues were ignored by the benchmarks. Initally, the market reacted negatively to RBI policy announcement, but recovered immediately. However, in the late trade, the sell-off in technology, FMCG along with Reliance Industries and BHEL dragged the benchmarks near previous day's closing value. The 30-share BSE Sensex rose 57.29 points, to end at 16,933.83, after erasing 189 points from day's high of 17,122.54. The 50-share NSE Nifty moved up 8.55 points, to close at 5,084.25.

The Reserve Bank of India (RBI) has raised the repo rate for the 12th time by quarter of a percent point to 8.25% on Friday and reverse repo rate adjusted to 7.25% to tame inflation. However, it kept cash reserve ratio (CRR) rate unchanged.

Experts were expecting that this would be the last rate hike from the central bank but that may not be the case. RBI said it would continue with its anti-inflationary stance as inflation is much above the comfort zone. Even global economic environment has worsened, it said.

Jim Walker, the managing director of Asianomics Limited says the RBI's rate hike is inline with their expectations. ''Even though the central bank has put too much weight on the WPI number, it will start watching the growth numbers much more carefully now.''

While he applauds the RBI on being ahead of the curve on its policy measures, he advices caution going ahead. ''It certainly has been very prudent in its management yet again but those monetary indicators are signaling for it to begin pausing and to think about whether or not it should raise again,'' adds Walker.

ONGC and Tata Motors were the biggest gainers throughout the session today; gained 5.6% and 7%, respectively. Government has put ONGC FPO on hold today and subsidy sharing burden with oil marketing companies would be lower post petrol price hike by Rs 3.14/Litre yesterday by govt was the another reason for ONGC's uptrend. For the Tata Motors, company's Jaguar and Land Rover's August sales jumped 31% to 21242 units year-on-year basis and 11% on month-on-month basis.

SBI, HDFC and ICICI Bank were up 2.5%, 0.85% and 0.58%, respectively; it seemed that banks have priced in RBI's move.

NTPC and Tata Power surged 4.75% and 2.7%, respectively. From the metal space, Sterlite Industries shot up 3.7%.

Maruti gained 2% as strike at Suzuki Powertrain, Suzuki Motorcycle called off today. However, workers' strike at Maruti's main plant is still on.

However, Reliance Industries, TCS, Infosys, TCS, BHEL, Tata Steel, M&M and Bharti Airtel witnessed selling pressure in the second half of trade; lost 0.4-1.4%. HUL and Wipro lost over 2%.

About 606 shares gained as against 817 shares declined. Total traded turnover was more than Rs 1.67 lakh crore - quite high as compared to previous few sessions.

At 15:15 hours IST : Market choppy; RIL, Wipro, TCS, BHEL under pressure

The sell-off in Reliance Industries has pushed the equity benchmarks closer to previous day's closing value. Wipro, TCS, HUL and BHEL too were adding pressure to the market. The 30-share BSE Sensex was trading at 16,904, down 28 points and the 50-share NSE Nifty was flat.

Heavyweight Reliance Industries fell over 1%. Wipro and HUL, which were down nearly 3%, too added more pressure on the market. TCS, BHEL, ITC and HDFC Bank were down 0.5-2%.

Largecaps like ONGC, NTPC and Tata Motors surged 4.5-7%. SBI, Sterlite and Power Grid gained 2.5-3.5%. HDFC, L&T and ICICI Bank too were helping the market to stay in green, which rose 1% each.

In the midcap space, Financial Tech, Shree Global, Rajesh Exports, Nava Bharat and Hathway Cable rallied 8-11% while HCL Info, India Cements, Essar Ports, Hexaware Tech and Motherson Sumi fell 6%.

In the smallcap space, SRS Real Infra, Man Infra, Pradip Overseas, Thomas Cook and Everonn Education gained 10-19.5%. However, IVRCL Assets, OCL India, Orbit Corporation, R M Mohite and Prabhav Industries slipped 5-6%.

At 14:11 hours IST : Sensex wipes out 50% gains amid volatility; HUL, BHEL dip

Equity benchmarks erased more than half of their gains as European markets slipped from day's high. The 30-share BSE Sensex was trading 107 points to 16,983 after slipping over 100 points from day's high. Meanwhile, the 50-share NSE Nifty could hold on to a gain of 27 points to trade at 5,102 amid volatility.

RBI policy was a non-event for the market. Central bank hiked repo rate by 25 basis points to 8.25% while reverse repo rate adjusted to 7.25%. RBI said it would continue with its anti-inflationary stance.

Infosys, HUL, HDFC Bank and BHEL extended fall; these stocks fell 1-2.5%. ITC and Bharti Airtel declined 0.4% each.

Kotak Mahindra Bank, HCL Tech, Reliance Communications and Jaiprakash Associates gained 1.4% each.

ICICI Bank too came off day's high; the stock rose just 0.4%. Heavyweight Reliance Industries was directionless, which is playing a role in volatility.

However, continued buying in SBI, L&T and HDFC has helped the market to hold in green; these stocks gained 1.5%.

ONGC and Tata Motors remained quite supportive since the opening trade today; shot up 5% and 6%, respectively. NTPC, Sterlite Industries, Tata Power and Hindalco rallied 3-3.5%.  Technology stocks like TCS and Wipro rose 0.5% each.

Axis Bank surged 2% as company's board has approved Axis-Enam deal. Bank will pay Rs 274 crore cash to Enam. Enam shareholders will get 1.38 crore Axis Bank shares.

New Listing: SRS was trading at Rs 34.45 as against issue price of Rs 58 a share.

Market breadth was mixed; about 1325 shares advanced as against 1368 shares declined on BSE.

At 13:01 hours IST : Sensex reacts to positive European cues, rises 190 points

Equity benchmarks shrugged of 25 basis point hike in repo rates and regained all its losses incurred earlier. The spike in gains came after European markets opened shop with over 0.5% jump since yesterday. The 30-share BSE Sensex rose181 points to 17,057 and the 50-share NSE Nifty gained 47 points at 5,122.

India's central bank, RBI, increased repo rate by 25 basis points to 8.25% while reverse repo rate came in at 7.25% after adjustements. Experts were debating on the possibility of this being the last rate hike but RBI maintained its hawkish tone, insisting that it would continue with  anti-inflationary stance as inflation is much above comfort zone.

Jim Walker of Asianomics Limited said rate hike was in-line with expectations. "RBI is putting far too much weight on WPI Figure" he said. He expects Indian exports to come off from current levels.

Among largecaps, Tata Motors extended gains post rise in JLR sales numbers for August; the stock shot up 6.5% and ONGC surged 5.5%.

Sterlite Industries, Tata Power and were up over 3.5%. Heavyweights NTPC, TCS, L&T, SBI, HDFC and ICICI Bank gained 1-3%. Reliance Industries too bounced back with 0.6% gain.

However, HCL Tech, Kotak Mahindra Bank, Reliance Capital, Reliance Communications, HUL, Jaiprakash Associates, Infosys and Bharti Airtel were down 0.5-1.5%.

SBI, ONGC, Tata Motors, Tata Steel, ICICI Bank and Infosys were most active shares on exchanges.

The market breadth was slightly in favour of advances; about 705 shares advanced as against 666 shares slipped.

At 12:21 hours IST : Rate hike impact: Sensex regains 100 pts after initial drop

Indian equity benchmarks washed out almost all gains as an initial reaction to the RBI's announcement that it would persist with its current anti-inflationary stance as inflation is much above the comfort zone. The central bank in its mid-quarter policy review hiked repo rate by 25 basis points to 8.25% and reverse repo rate has been adjusted to 7.25%.

Regaining momentum after the announcement, the market covered some losses as the rate hike was on expected lines. The 30-share BSE Sensex was trading at 17,010, up 34 points and the 50-share NSE Nifty rose 31 points to 5,106 amid volatility.

Bank Nifty gained 39 points, which had shed 48 points post RBI announcement. SBI and ICICI Bank were up over 0.7%.

ONGC continued to hold its top position in the buying list post deferral of FPO by government; the stock gained 5.5%. Tata Motors too held its early trade gains; rose 5%.

Power and auto stocks too were on buyers' radar. TCS, HDFC and L&T jumped 1.5%.

However, the selling in Infosys, Bharti, Reliance Industries, HUL, HDFC Bank, BHEL and ITC has limited the upside; these stocks fell 0.3-0.8%.

At 11:25 hours IST : Sensex holds 17K ahead of RBI policy; Tata Motors up 5%

The market continued to trade higher ahead of RBI's mid quarter policy review today, though there was some profit booking at higher levels. Both benchmarks were hovering around their key psychological levels. The 30-share BSE Sensex gained 142 points to trade at 17,019 and the 50-share NSE Nifty rose 34 points to 5,109.

The street expects a 25 basis points hike in rates to combat inflation which has come in at near 10% for the month of July. The market has factored this in and is rallying on expecations that it could be last of the hikes. But  Rahul Chadha of Mirae Asset Management thinks inflation will not end here and the central bank will continue with its tightening measures for a while more. He expects a 25 basis points (bps) hike today. ''Due to depreciation in the rupee, hikes in electricity tariffs by state electricity boards (SEBs) and commodity prices, inflation is proving to be far stickier'' he said. Over the next one year, RBI may choose to sacrifice growth to control inflation, he adds.

There was a bit of volatility in the market due to Reliance Industries and SBI. The sell-off in Bharti Airtel, Infosys, HUL, BHEL (which fell 0.5-0.9%) has limited the upside.

However, consistent buying in power, metal, cement, select financial and healthcare stocks was helping the benchmarks. TCS, HDFC, L&T and ICICI Bank were quite supportive.

ONGC and Tata Motors maintained their top position in the buying list. Former one rallied nearly 6% post postponement of FPO by government and later one gained 5% due to rise in sales volume of Jaguar and Land Rover.

The market breadth was mixed; about 679 shares advanced as against 658 shares declined.

Among midcaps, Parsvnath, Hathway Cable, SKS Microfinance, Ramky Infra and M&M Financial gained 3-4% while KGN Industries, Jai Corp, HCL Info, CORE Education and Essar Ports lost 3-4%.

At 10:29 hours IST : Sensex holds on to early gains, global cues support

Indian equity benchmarks held on to early trade gains, supported by ONGC post deferral of FPO by government. Financial, metal, power, realty and select technology stocks were on buyers' radar. The 30-share BSE Sensex surged 201 points to 17,077 and the 50-share NSE Nifty jumped 54 points to 5,130, ahead of RBI's credit policy to be held at 12 hours IST today.

Asian markets too were quite supportive post European Central Bank coordinated efforts with the Fed and other central banks to extend dollar loans to European banks. Hang Seng and Nikkei rose 2% each. Kospi and Taiwan rallied 3-3.6%. Straits Times was up 1.3% and Shanghai up 0.4%.

On the home turf, ONGC shot up 7% as government put the companny's follow on public offer on hold. The second reason could be the petrol price hike of Rs 3.14 per litre by the government, which would reduce the subsidy sharing burden for oil marketing companies. HPCL, BPCL and IOC gained 2%.

Among other largecaps, TCS, NTPC, HDFC, L&T, ICICI Bank, Sterlite, DLF, Hindalco, Tata Power and Tata Steel were up 1-2%. SBI, HDFC Bank, Reliance Industries and Wipro rose 0.5%.

Tata Motors surged 5% as its JLR's total sales in August went up 31% to 21242 units year-on-year and rose 11% on month-on-month basis.

However, Infosys, Bharti Airtel, BHEL, Maruti and Kotak Mahindra Bank were marginally in the red.

The Indian rupee also appreciated to 47.43 per dollar, gained 0.26% compared to previous day's closing value. This appreciation might be due to RBI's intervention by selling more dollars.
About 795 shares advanced as against 483 shares declined on NSE.

At 9:18 hours IST : Sensex opens at 17K ahead of RBI policy; ONGC surges 6%

Indian equities opened higher, on Friday, ahead of the Reserve Bank's mid-quarter policy review, reflecting positive global cues from the Eurozone.

Investors pushed US stocks higher for a fourth day, on Thursday, as coordinated central bank action encouraged optimism about dealing with the euro zone debt crisis and its threat to the global recovery.

The 50-share NSE Nifty rose 35 points to 5,110 and the 30-share BSE Sensex gained 134 points at 17,010 amid volatility.

ONGC shot up 6% as sources claimed that FPO is likely to be delayed by next 15 days, citing price mismatch. Govt may take a fresh view on ONGC FPO post market feedback, say sources.

Among frontliners, DLF, HDFC, Sterlite Industries, Hindalco, Tata Steel, Sesa Goa, TCS, Reliance Communications, GAIL, Reliance Industries, BPCL and Tata Motors (up 2.5% up JLR sales for August) gained.

However, Maruti fell 1.5% as company's Gurgaon & Manesar plant will remain shut today. Dr Reddy's Labs, Bharti and HUL were down 0.5%.

Government hiked petrol price by Rs 3.14/litre. IOC, HPCL and BPCL were up 2-3%. However, Kingfisher Airlines and Jet Airways fell 1%.

New listing: SRS fell 12% to Rs 51 as against issue price of Rs 58 a share.

The CNX Midcap rose 41 points to 7,381. About 607 shares advanced as against 350 shares declined on NSE.

Everonn Education shot up 6% and SKS Microfinance was up 3.5%.

REC, HOEC, Ashok Leyland and Mahindra Satyam rose 1% each.