Sensex recovers to close 26 points down; Europe rebounds

The BSE Sensex pared losses quite nicely in second half of trade to close marginally lower following a sharp bounce back in European markets. The index recovered more than 150 points from intraday low of 17,026.97, before closing with a loss of 26.43 points at 17,197.93.

Meanwhile, the NSE Nifty managed to claw back above the important level of 5200 led by support from oil & gas, technology, capital goods and HDFC group stocks. The index fell 12.05 points to 5,215.70.

Mithil Pradhan, Sr Vice President - Technicals & Derivatives, Violet Arch Capital Advisors believes that upsides are really restricted at this point of time because the weakly and monthly charts both are overbought from a momentum perspective.

European markets like France's CAC, Germany's DAX and Britain's FTSE gradually rose to 1-1.5% since initial trade today, erasing most of the previous day's pull-back and resuming a week-long rally as investors judged the European Central Bank remains committed to bold action to fight the debt crisis.

Markets were also awaiting US jobs data that could fuel expectations of further stimulus from the Federal Reserve. The Dow Jones futures gained 68 points at 15:31 hours IST.

European shares had tanked 1-2.7% on Thursday after European Central Bank President Mario Draghi disappointed some investors by announcing no immediate action to help lower the borrowing costs of Spain and Italy. Spain and Italy markets tumbled around 5% yesterday.

Back home, the Sensex and Nifty gained more than 2% on inflow of foreign money. Foreign institutional investors bought more than Rs 3,000 crore worth of Indian equities since July 27.

The market gained this week, even after getting disappointed by three major events, which were RBI policy on Tuesday, Federal Reserve' decision on Wednesday and European Central Bank on Thursday.

Housing finance company HDFC and private sector lender HDFC Bank gained 0.5-1%.

Top oil & gas producers Reliance Industries and ONGC moved up 0.5% and 1.34%, respectively.

Country's largest power producer NTPC gained 1.84%, rising for the second consecutive session after yesterday's rally of nearly 4% while private power producer Tata Power declined 0.92%.

Top software services exporter TCS and Infosys were marginally higher while their rival Wipro rallied 2%.

India's largest lenders State Bank of India and ICICI Bank were down 2% and 0.5%, respectively. Engineering and construction major Larsen & Tourbo slipped 0.5% whereas power equipment manufacturer gained 0.7%.

Metals stocks hit quite hard on ECB disappointment. Hindalco Industries, Sterlite Industries, Jindal Steel and Tata Steel tanked 2%-2.6%.

Among auto stocks, Tata Motors, Bajaj Auto, Maruti Suzuki and Hero Motocorp were down 0.4-1%. Tractor maker Mahindra & Mahindra fell 1.44% on fears of less buying of tractors due to monsoon deficiency.

DS Pai, Director-Long Range Forecast, India Met Department (IMD) highlighted that rainfall in India is 19% deficient so far because the monsoon didn't pan out as per expectations in July. Further, he said that the rainfall in the next two months is expected to be below normal and around 91%.

Cigarette major ITC and top telecom operator Bharti Airtel slipped over 0.7%.

The broader markets too closed flat. On the National Stock Exchange, decliners outnumbered advancers by 849 to 577.

In the second line shares, Mahindra Satyam gained more than 6% and Berger Paints rose 5% after better than expected numbers in first quarter. Jet Airways went up 0.7% as the company turned profitable for the first time in last six quarters. Marico declined 3% on profit booking; its results in Q1 were quite stronger than expected on every count.

Sugar stocks like Balrampur Chini, Bajaj Hindusthan and Shree Renuka Sugars were up 3-5%.

DB Corp rose 7% and Deccan Chronicle Holdings was up nearly 2% as sources say DB Corp is in talks to acquire DCHL's print business.

United Breweries Holdings and United Spirits were up 1.5%. OnMobile Global surged over 9%.

Dishman Pharma and Kale Consultants rallied more than 5% while both shot up 25% this week on better than expected numbers in Q1.

However, GVK Power, Reliance Power, NCC, REC, Pantaloon Retail, S Kumars and Indiabulls Real were down 3-5%.

European and Indian shares shares staged a slight recovery on Friday from a selloff provoked by the European Central Bank's failure to satisfy investors' hopes of swift action to tackle the debt crisis.

The ECB kept rates unchanged and dashed hopes of any immediate action to ease the borrowing costs of Spain and Italy by indicating it may resume buying bonds but only under conditions that would delay any move until at least September.

The Sensex was down 88.84 points or 0.52% at 17135.52, and the Nifty lost 29.50 points or 0.56% at 5198.25. About 1130 shares advanced, 1497 shares declined, and 812 shares remain unchanged.

The euro was under pressure but traded around $1.22, up 0.15 percent, having fallen nearly three cents to $1.2133 on disappointment over the ECB's decision.

The services sectors in emerging powerhouses China and India grew in July at a healthy pace, providing vital support for the two economies as their manufacturing sectors struggle with the global downturn.

China's official purchasing managers' index (PMI) for the services sector fell to 55.6 in July from 56.7 in June, while a similar private-sector survey sponsored by HSBC headed in the opposite direction, rising to 53.1 from a 10-month low in June of 52.3.

India's non-manufacturing PMI from HSBC was little changed, slipping to 54.2 in July from 54.3 in June.

Shares in state-run banks fall on concerns a looming drought would increase defaults of farm loans, leading to higher provisioning in coming quarters.

Top-ranked State Bank of India falls 1%, while Oriental Bank of Commerce drops 2.2% and Allahabad Bank retreats 1.5%.

"If government declares drought in most of the states, then there will be rescheduling of repayment of crop loans, which accounts for a significant portion of total agri portfolio of the state-run banks," Manish Ostwal, sector analyst at KR Choksey said.

Tractor maker Mahindra & Mahindra shares fall 1.7% as the growing likelihood of a drought in India threatens to hit rural sales.

Mahindra & Mahindra already saw tractor sales fall 2.4% from the previous month and 4.5% on a year-to-year basis.

After five straight quarterly losses, Jet Airways has reported a net profit of Rs 24.70 crore for the April-June period on improved yields and cost cutting measures. The country's largest private airline said if not for a  forex loss of Rs 69 crore, it would have posted better results.

The BSE Sensex continued to trade weak in afternoon trade. Investor dissapointment was clearly visible as the European Central Bank, after inaction from the Federal Reserve, disappointed markets looking for an imminent move to deal with the euro zone debt crisis, spurring risk aversion.

European stocks inched higher in early trade on Friday, halting the previous session's sharp pull-back, as investors await US jobs data that could potentially fuel expectations of further stimulus from the Federal Reserve.

Except for the BSE Healthcare, all other sectoral indices were trading in red. The BSE metals, capital goods, realty, auto and banking indices were down 1-2%.

Stocks like ITC, Reliance, ICICI Bank, Coal India and L&T were among the negative contributors.

Market analyst Manoj Singla of Religare Capital Markets expects markets to trade with a negative bias for a few months. "The chance of a test of 4800 on the Nifty is not ruled out," Singla said.

The Sensex was down 117.51 points or 0.68% at 17106.85, and the Nifty was down 39 points or 0.75% at 5188.75.

About 994 shares have advanced, 1480 shares declined, and 965 shares are unchanged.

Top losers on the Sensex were Tata Steel at Rs 394.90 down 2.71%, Sterlite Ind at Rs 102 down 2.67%, Coal India at Rs 338.30 down 2.49%, Hindalco at Rs 116.40 down 2.31% and Jindal Steel at Rs 394.95 down 2.28%.

However, top gainers on the Sensex were Dr Reddys Labs at Rs 1,670.50 up 1.53%, NTPC at Rs 165.75 up 1.50%, Wipro at Rs 343.45 up 1%, ONGC at Rs 279.05 up 0.83% and Cipla at Rs 352.10 up 0.76%.

Mahindra satyam and Tech mahindra up 6% post strong earnings by Mahindra satyam  . Margin improved to 21.7% vs 17.5% QoQ . CS has revised their earnings numbers for Satyam (standalone) by 515% over FY1315 due to the higher-than-expected margins and upped TP by 5% from 88 to 92 rs.

Glenmark Pharma up 4.49% post earnings , numbers in line with expectations , forex losses impacted profitability. Highlight of Q1 was 24% YoY sales growth in India and 6% QoQ sales growth in the US in constant currency. CS maintains OPF on Glenmark due to (1) high earnings CAGR of 22% over next two years and (2) R&D upside available as option value which should improve RoCE and reduce leverage and drive re-rating

Jet Airways up 2% ahead of numbers today . Losses expected to narrow to 198cr vs adj net loss of 241cr YoY . Yields to improve, load factors expected to remain strong at ~80% due to reduction in capacity by Kingfisher airliness. Reduction in ATF prices to help lower fuel costs , thus aiding profitability

Deccan Chronicle down another 3% today. Chairman T Venkatraman reddy released a statement in Deccan chronicle yesterday accepting that company is indeed facing a liquidity crunch says liquidity crisis has arisen due to significant reduction in ad spend by domestic and multinational companies in India.

The Sensex was dented in Friday's trade by ECB's Draghi and possible drought situation.

Falls track weaker in Asian shares after the European Central Bank took no immediate action and only signalled future steps to tackle the euro zone's fiscal woes, following earlier inaction from the US Federal Reserve.

The Sensex was down 195.02 points or 1.13% at 17029.34, and the Nifty lost 61.45 points or 1.18% at 5166.30. About 906 shares advanced, 1371 shares declined, and 1162 shares remain unchanged.

Top losers on the Sensex were Sterlite Industries, Tata Steel, Hindalco, ICICI Bank and Tata Motors. Dr. Reddy was the top gainer.

India's services sector expanded for the ninth straight month in July as new orders grew at a steady pace but firms were less optimistic about the future, a business survey showed on Friday.

The HSBC Purchasing Managers' Index for the services sector, which gauges the activity of hundreds of Indian companies, slipped to 54.2 in July from June's 54.3.

The index for the sector, which makes up nearly 60% of the Indian economy, has held above the 50 mark that separates growth from contraction, since November last year.

Stocks also hit after the weather office said India's monsoon rains are now expected to be deficient in 2012, signalling the first drought in three years.

Although the announcement had been largely expected, stocks dependant on rural consumption falter. Tractor maker Mahindra and Mahindra shares fall 1.6%.

Lenders fall on worries a weak monsoon will drive up food prices, delaying any rate cuts from the RBI. ICICI Bank falls 1.7%, while State Bank of India declines 1.6%.

Satyam Computer Services jumps 8.7%, after hitting as high as 91.85 rupees, its highest since July 21, 2011. Gains come after the software services exporter beat analyst estimates with a 56.4 percent rise in quarterly profit after it won new business and got a boost from currency effects.

Satyam Computer Services Ltd , is in the process of merging with parent Tech Mahindra Ltd. Tech Mahindra gains 6.6%.

The BSE benchmark Sensex lost some weight in first half of the trading session. Metals, infra and capital goods stocks were major laggards.

The rupee fell to a one-week low as global risk assets retreated after the European Central Bank indicated willingness to buy government bonds but set conditions that disappointed markets. Barring Shanghai, Asian markets too were bleeding dashing hopes of a bounce back.

The Sensex was down 165.24 points or 0.96% at 17059.12, and the Nifty was down 51.45 points or 0.98% at 5176.30. About 902 shares advanced, 1116 shares declined, and 1421 shares remain unchanged.

The monsoon has now turned out to be a major concern for Indian markets. In an interview to CNBC-TV18 DS Pai, Director-Long Range Forecast, India Met Department (IMD) highlighted that rainfall in India is 19% deficient so far because the monsoon didn't pan out as per expectations in July. 

Further, he said that the rainfall in the next two months is expected to be below normal and around 91%.

The government raised margins on Sugar and Wheat futures by 10% with effect from August 6 reports CNBC-TV18 quoting Agencies. The move came in to curb rally  in agri futures.

In the broader market, Berger Paints, Hind Nat Glass, Glenmark, DB Corp and Nava Bharat Ventures were star performers. Glodyne Techno, Indiabulls Real, Manappuram Finance, Prism Cement and Shoppers Stop were top losers.

The euro hit all-time lows against the Australian and New Zealand dollars in early Asia trade around A$1.1600 and NZ$1.4980 respectively, and traded at $1.2176 against the U.S. dollar, not far from a one-week low of $1.21335 touched after investors digested the ECB's news on Thursday.

The BSE Sensex fell 100 points in early trade on Friday as the European Central Bank, after inaction from the Federal Reserve, disappointed markets looking for an imminent move to deal with the euro zone debt crisis, spurring risk aversion.

The BSE benchmark declined 121 points to 17,103 and the NSE benchmark was down 38.35 points to 5,189.40.

Among Asian markets, Hang Seng, Kospi and Taiwan Weighted lost 0.65%-0.9%. Nikkei tanked 1.6% while Shanghai gained just 0.4%.

European Central Bank - the last major event this week after RBI policy and FOMC meet - too disappointed the street by keeping policy rates unchanged yesterday. The central bank has not even announced any new policy measures to revive sluggish economic growth.

Back home, JSPL, Sterlite, Hindalco, Sesa Goa, M&M, Tata Motors, SBI, ICICI Bank, Axis Bank, JP Associates, HCL Tech and L&T were down in early trade.

However, Dr Reddy's Labs, NTPC, ONGC and Asian Paints were on buyers' radar.

THe CNX Midcap Index declined 24 points to 7,231 as about two shares declined for every share advancing on the National Stock Exchange.

Mahindra Satyam surged over 4% after better than expected numbers in the first quarter of FY13. Glenmark Pharma was up over 1%, Oracle Financial rose 1.8% and Shasun Pharm gained 0.5% after June quarter results.

Kale Consultants gained another 5% after yesterday's 20% rally due to strong numbers in June quarter.

Jet Airways, United Spirits and Deccan Chronicle were up 0.5-1%.

Ashok Leyland, SKS Microfinance (ahead of Q1 numbers today), REC, Alok Industries, VIP, Sintex, S Kumars and Reliance Capital dropped 1-2.5%.