BSE Sensex ends down; M&M falls 4% on weak July sales

4:00 pm Market closing: The Sensex closes down 28.51 points at 19317.19, and the Nifty end the volatile session at 5727.85, down 14.15 points. About 773 shares have advanced, 1423 shares declined, and 151 shares are unchanged.

Private banks like HDFC Bank , Axis Bank , HDFC were among the key gainers in the Sensex. On the losing side are BHEL , M&M, Coal India , ONGC and Hindalco . Oil & gas,realty, auto and metal stocks dragged during the day.

Midcap and small cap stocks were punished by investors in today's trade.

3:50 pm Earnings: Diesel and natural gas engines manufacturer Cummins India reported a dismal performance on all parameters with the first quarter net profit falling 8 percent year-on-year to Rs 166 crore.

Total income from operations dropped 16.6 percent to Rs 1,049 crore during April-June quarter from Rs 1,259 crore in a year ago period.

3:45 pm RBI comments on rupee: The Reserve Bank of India said on Thursday that foreign institutional investors who have issued a participatory note, can hedge their forex risk in these securities provided they have a mandate from the participatory note holder, reports Reuters.

3:35 pm Hit by slowdown: Hit by slowdown, auto major Mahindra & Mahindra today said it will stop production for up to six days in the forthcoming months at its automotive plants to adjust output to demand in the market, reports PTI.

The company had on July 11 announced that it would stop production at its automotive plants for a period ranging from 1 to 8 days during the remaining period of the month.

3:25 pm Government measures: The government is likely to go ahead with its proposed 5 percent stake sale in Coal India this month that is expected to fetch around Rs 10,000 crore to the exchequer, after major trade unions reached an agreement on the quantum of disinvestment.

"Coal India disinvestment may hit the market in August as three of its five major trade unions have given their consent to proceed with 5 percent stake sale in the PSU," Coal Minister Sriprakash Jaiswal, reports PTI.

The market has not managed to put its foot firm in today's trading session. The Sensex is down 36.13 points at 19309.57, and the Nifty down 17.85 points at 5724.15. About 730 shares have advanced, 1363 shares declined, and 143 shares are unchanged.

The BSE Bankex gained more than one percent due to gains in private sector banks, but PSU banks are still under pressure on asset quality concerns. State Bank of India lost 2 percent while Axis Bank and HDFC Bank gained 5 percent and 3.5 percent respectively.

Most of the private banking stocks are holding up the indices. Mid and smallcap stocks are still in pain while oil & gas, capital goods, metals and realty are also reeling under pressure.

Mahindra & Mahindra's total automotive sales in July declined 21 percent year-on-year to 37,096 units, amid sluggish demand for both utility vehicles and commercial vehicles. The stock falls around 5 percent on the BSE.

Meanwhile, automobile sales in India have been slow for more than a year now. However, utility vehicles saw strong growth for much of FY13, helped by increased price differentiation between petrol and diesel and new launches like M&M's XUV500 and Quanto, Renault's Duster and Maruti Suzuki's Ertiga. However, even SUVs have now hit speed bumps since last few months following a hike in excise duty by the government, and partial de-regulation of diesel prices.

03:00pm Shares of HDFC Bank and Hindustan Unilever rallied 4 percent each while HDFC rose 2 percent.

The BSE Bankex gained more than one percent due to gains in private sector banks, but PSU banks are still under pressure on asset quality concerns. State Bank of India lost 1.6 percent while ICICI Bank gained 0.2 percent.

However, state-owned ONGC and BHEL plunged 5 percent each. Mahindra & Mahindra dropped 4 percent post weak July sales numbers .

Among others, Reliance Industries , Coal India , Tata Steel and Hindalco Industries declined more than 2 percent.

02:40pm Equity benchmarks remained volatile from morning trade due to nervousness among brokers after problem in National Spot Exchange. It may be a consolidation phase as the market saw nearly 1000 points fall on the Sensex in previous six session.

The BSE Sensex is up 62.09 points at 19407.79, and the NSE Nifty is up 10.65 points at 5752.65, but the broader markets are still in pain.

The BSE Midcap Index is down 1.3 percent and Smallcap slipped 0.9 percent as declining shares outnumbered advancing ones by 1352 to 746 on the exchange.

Tata Global shares dropped 4 percent after its net profit (excluding exceptional gain of Rs 36 crore) declined to Rs 75.6 crore from Rs 77.7 crore while net sales increased marginally to Rs 1,796 crore from Rs 1,714.9 crore.

Cummins India too crashed four percent as its first quarter net profit slipped to Rs 166 crore from Rs 180.5 crore and total income dropped to Rs 1,049 crore from Rs 1,259 crore year-on-year.

2:00 pm RBI action: The Reserve Bank of India's Governor Duvvuri Subbarao said on Thursday that the central bank is as anxious as everyone else to roll back the recent cash tightening steps sooner than later.

However, the measures will be in place until volatility in the foreign exchange market is controlled, he said.

1:55 pm MCX comments: The Multi Commodity Exchange of India said it does not see any operational or financial impact from the suspension of forward contracts by commodities bourse operator National Spot Exchange Ltd (NSEL), which shares its promoter with MCX.

1:50 pm Auto sales: Mahindra & Mahindra's total automotive sales in July declined 21 percent year-on-year to 37,096 units, amid sluggish demand for both utility vehicles and commercial vehicles. The stock falls 4 percent on the BSE.

Automobile sales in India have been slow for more than a year now. However, utility vehicles saw strong growth for much of FY13, helped by increased price differentiation between petrol and diesel and new launches like M&M's XUV500 and Quanto, Renault's Duster and Maruti Suzuki's Ertiga. However, even SUVs have now hit speed bumps since last few months following a hike in excise duty by the government, and partial de-regulation of diesel prices.

1:45 pm Earnings: State-owned lender Union Bank of India disappointed the street with the first quarter net profit rising lower-than-expected 9.5 percent year-on-year to Rs 560 crore on higher other income, but dented by rising bad loans. The stock is down 6 percent on the BSE.

1:40 pm Market action: Market regulator Sebi has begun a probe into a major crash in the share prices of commodity bourse MCX and its promoter Financial Technologies (FTIL) and has sought information from stock exchanges in this regard.

FTIL stock today fell by over 60 percent in early morning trade, while that of MCX (Multi Commodity Exchange) plunged by 20 percent following concerns about another group entity National Spot Exchange Ltd (NSEL).

It's an extremely choppy session for the market and the Nifty is trading below 5750. The Nifty is at 5736, down 5 points while the Sensex is up 33.68 points. About 680 shares have advanced, 1323 shares declined, and 135 shares are unchanged.

The midcap index is down around a percent. Selling pressure seen across rate sensitives and commodity plays.

Watch out for IOC as the CCEA will take up the matter of 10 percent divestment in the oil marketing company later today. However, sources indicate the government is likely to delay the stake sale process until rupee volatility eases.

12:50pm Earnings: Union Bank of India shares dropped more than 7 percent after it reported lower-than-expected numbers in first quarter. Net profit grew far lower-than-expected 9.5 percent year-on-year to Rs 560 crore as against forecast of Rs 653 crore.

Net interest income rose by 4.77 percent on yearly basis to Rs 560 crore, which too was below expectations of Rs 2,031 crore for the quarter while non-performing asset increased.

12:28pm The market is trading in choppy waters and the brokers are nervous after the NSEL problem that slaughtered shares of Financial Technologies quite badly .

The BSE Sensex is up 90.18 points at 19435.88, and the NSE Nifty is up 9.35 points at 5751.35, but the broader markets see deeper cut.

Financial Technologies shares dropped nearly 62 percent to Rs 206.85 after the National Spot Exchange (NSEL) has suspended trading in all one-day forward contracts , except e-series contracts, amid fears of default.

The current problem at the National Spot Exchange Limited (NSEL) is one of a liquidity mismatch and not a solvency crisis, feels Deena Mehta of Asit C Mehta Investment Intermediaries.

"NSEL problem is keeping lot of brokers nervous specially the Indian broking community because a lot of brokers have been involved in this product. Of course, you won't know the exact picture but the buzz is that has created a lot of angst in the minds of broking community," says Dipan Mehta, Member, BSE and NSE.

The BSE Midcap Index fell 1.4 percent and Smallcap declined nearly one percent. About two shares declined for every share advancing on the BSE.

Indian rupee depreciated by 40 paise to 60.80 against the US dollar.

11:55 am RBI measures: The RBI intervened in the foreign exchange market to stop the rupee's slide toward a record low as its defence of the currency, built around draining cash from money markets, came under rising pressure.

With the Reserve Bank of India struggling to hold the line, investors are sceptical whether the government will take swift, credible action to reduce a gaping current account deficit despite Finance Minister P. Chidambaram's assurances.

11:50 am Macro outlook: The "band-aid" measures taken to address current account deficit (CAD) and  protect the free falling rupee have failed to yield desired result making India vulnerable to ratings downgrade, says Rajeev Malik of CLSA .  Finance minister P Chidambaram's promise on Wednesday to contain fiscal deficit (FD) at 4.8 percent in FY14 appears far-fetched since India's fiscal deficit in the April-June quarter came in at 48.4 percent compared to 37.1% in the previous year. It remains to be seen if the present rate of inflows can add  the USD 80 billion projected by the finance minister.

"The government has to take stern steps to fix the underlying rupee problem. Given macro economic mess we don't need temporary solutions. Relative to the issues faced, the steps undertaken have been inadequate. Fitch must be regretting its outlook upgrade," he told CNBC-TV18 in an interview.

11:45 am Exclusive: Anjani Sinha, CEO, National Spot Exchange (NSEL) says that it has Rs 800 crore in guarantee fund and have not liquidated stock as of now. In an interview to CNBC-TV18 he said that NSEL will announce pay-in, pay-out dates by Friday at latest. Anand Rathi Commodities is the trading member of NSEL.

11:35 am  Market opinion:"NSEL problem is keeping lot of brokers nervous specially the Indian broking community because a lot of brokers have been involved in this product. Of course, you won't know the exact picture but the buzz is that has created a lot of angst in the minds of broking community," says Dipan Mehta, Member, BSE and NSE.

11:30 am Big crash: The big story in the market is the complete collapse in the Financial Technologies stock, which has tanked 60 percent on the BSE. FT promoted, National Spot Exchange has suspended trading of all contracts, other than e-series contracts on fears of a default. FT is also the promoter of Multi Commodity Exchange of India ( MCX ). MCX shares plunged 20 percent to a record low of Rs 512.05.

After initial gains, the market continues it's downwards journey. The Nifty sinks below 5800 and is at 5720, down 22 points while Sensex slips 28.31 points to 19317.39. About 649 shares have advanced, 967 shares declined, and 102 shares are unchanged.

Most of the PSU banking stocks are hit the most.

In Asia, China rallies over a 1 percent after July official PMI at 50.3 topped expectations. While the HSBC final manufacturing PMI reading came in at an 11-month low of 47.7. Rest of Asia is also trading with positive with Nikkei getting a lift from positive earnings from Panasonic.

In currencies, dollar index slips a bit at 81.6, euro appreciates to 1.33 and yen trades near 98 levels.

In commodities, gold is sideways at USD 1330, however gains 7 percent in July, crude inches upto USD 108, Nymex up to USD 105.6

The rupee opened slightly lower to adjust to the huge intervention in the last hour of trading yesterday, but thereafter dollars got sold, in sync with the weak dollar across emerging markets. There is demand for dollars from importers at lower levels.

10:45am The market reversed all its early gains with the Sensex falling below 19300 level, weighed down by oil & gas, capital goods, metals and PSU banks.

The BSE Sensex is down 45.95 points at 19299.75, and the NSE Nifty is down 31.05 points at 5710.95.

State-owned ONGC plunged nearly 4 percent while private oil & gas explorer dropped 1.8 percent.

Country's largest lender State Bank of India lost 2 percent. In fact all PSU lenders are under pressure, fallling between 2-7 percent.

Capital goods majors Larsen & Toubro and BHEL declined 1 percent and 3 percent, respectively.

Hindalco and Tata Steel shares tumbled 2-2.5 percent.

However, HDFC, HDFC Bank , Hindustan Unilever and Sun Pharma gained 1.5-1.8 percent while ITC came off day's high, rising just 0.6 percent.

10:20am The market remained on the higher side with the Nifty inching towards 5800 level and the Sensex staying above the 19500 level, supported largely by short covering in stocks that were badly hit in last six sessions.

The BSE Sensex is up 163.81 points at 19509.51, and the NSE Nifty is up 47.10 points at 5789.10. The market breadth also improved today with the 2 shares advancing for every share declining on the BSE.

Defensives are the leader today; FMCG majors ITC and Hindustan Unilever gained 1.65 percent and 3 percent, respectively while HDFC and HDFC Bank rallied 2.6-3 percent.

Country's largest private sector lender ICICI Bank rose nearly one percent, but its rival State Bank of India declined one percent after initial gains.

Maruti Suzuki shares advanced 0.4 percent despite fall in total sales for July. Top car maker sold 83,299 units in July as against 84,455 units in June, led by fall in domestic sales. Exports increased to 8,154 units from 7,453 units month-on-month.

Financial Technologies shares crashed 40 percent after NSEL suspended trading amid fears of default and suspended trading in one-day forward contracts. Multi Commodity Exchange ( MCX ) also lost 19 percent.

9:55 am Divestment: The government's 3.56 percent stake sale of Neyveli Lignite Corporation  (NLC) through the institutional placement route will hit the markets on August 2 and is expected to fetch around Rs 350 crore to the exchequer. The stock is up 3 percent on the BSE.

9:50 am RBI action: The RBI likely sold dollars via state-run banks in early trades on Thursday after the currency weakened tracking the dollar's strength in Asia, dealers said.

The Reserve Bank of India was seen selling dollars from 60.75 rupee levels, three dealers told Reuters.

9:40 am Market outlook: Sanjay Dutt, Director, Quantum Securities is bullish on market and is confident that the next 6-12 months will be much better. In an interview to CNBC-TV18 he says that the index may not move but select stocks will see gains.  As an investment strategy, he suggests buying Jindal Saw and avoid JP Associates.  He prefers Idea among telecom stocks. 

9:35 am Weak: Wockhardt loses another 5 percent on the BSE as media reports suggest that Maharashtra Foods and Drugs Administration has registered an FIR in Pune against the company clearing and forwarding outlets for the alleged illegal sale and distribution of spasmo-proxy-von capsules.

9:30 am Earnings: Liquor manufacturer United Spirits posted a dismal performance during the first quarter with the net profit falling 19 percent year-on-year to Rs 118 crore.

The company also disappointed with its revenue, operational and volume performance while escalating raw material prices caused margin contraction.

Revenues grew by 6 percent to Rs 2,207 crore during April-June quarter from Rs 2,073 crore in a year ago period. The stock, however, is up around 3 percent on the BSE.

9:20 am Downgrade: Goldman Sachs downgraded its rating on Indian stocks to "underweight" on concerns about delayed growth recovery and rising vulnerabilities for the economy, reports Reuters.

The external funding environment has also become challenging causing RBI to tighten liquidity, the investment bank said in a note.

Goldman Sachs also expects corporate earnings to grow at 5 percent for the current fiscal year and 11 percent for the next year, below consensus estimates.

The market has opened in the positive terrain led by short covering. The Sensex is up 128.76 points at 19474.46, and the Nifty adds 34.90 points at 5776.90. About 217 shares have advanced, 53 shares declined, and 24 shares are unchanged.

RBI will auction 7-day cash management bills worth Rs 3,000 crore today. RBI says cash management bills auction is based on multiple price method.

The Indian rupee opened at 60.78 per dollar versus 60.40 yesterday.
Mohan Shenoi, Kotak Mahindra Bank said, "Expectations of a liberalized FDI policy, PSUs raising funds in overseas markets, rise in import duty of luxury items and export promotion measures will have a soothing impact on the rupee. The range for the day is seen between 60.20-60.80/USD."

Meanwhile, July auto sales data are due today. Retail sales could see a decline for all segments especially 2-wheelers led by fuel price hike, high rates and weak economic sentiment. Car volumes are seen declining by 4-5 percent year on year.

The FOMC meet is a non-event for the market as the Federal Reserve said it will maintain its bond-buying policy in its ongoing effort to bolster the economy.

In the currency space, the euro holds above 1.32 to the dollar. The dollar index is around 81.60 levels. The dollar yen is at 98

Brent crude hovers around USD 107. Nymex rises to USD 105 levels. Gold continues to trade around USD 1330 an ounce.