BSE Sensex gains 250 points; Realty up 4%, cap goods rally

3:30 pm FII view: Shane Oliver of AMP Capital Investors maintains a cautious stance on India given its relatively high inflation rate and its trading at relatively high price to earnings multiple compared to emerging market (EM) average.

According to him, elevation inflation, will constrain Reserve Bank of India 's ability to stimulate the already subdued economy.  Speaking to CNBC-TV18, he said, global recovery is likely to continue and will benefit EMs, but they may not outperform in the immediate near-term.

"Emerging markets currently are undervalued compared to developed markets. Any weakness in either Indian share markets, or global share markets is a buying opportunity because once the US debt ceiling is resolved, it will set us up for a year-end rally," he recommended.

The market is going higher in the last hour of trade. The Sensex is up 264.71 points at 20248.32, and the Nifty up 77.60 points at 6006. About 1361 shares have advanced, 962 shares declined, and 146 shares are unchanged. Reliance Industries , Infosys and HDFC Bank are the leaders of this rally, gaining between 2.5-3 percent. Country's largest lenders State Bank of India (up 0.02 percent) and ICICI Bank (up 1 percent), which were under pressure from early trade, recouped losses.

As India's trade deficit for the month of September fell to USD 6.76 billion from USD 17.15 billion a year ago, PMEAC chairman Dr C Rangarajan sees FY14 current account deficit (CAD) even lower than projected USD 70 billion.

While exports are up 11.15 percent to USD 27.68 billion in September, imports have dipped 18.1 percent to USD 34.44 billion. Gold and silver imports slid to USD 0.8 billion for the period in focus from USD 4.6 billion in September 2012. Gold is the biggest non-essential item in India's import bill. In an interview to CNBC-TV18 Rangarajan said that several factors have contributed to decline in gold imports. However, he also warned that pick-up in gold imports is likely during the upcoming festive season.

02:45pm Market rallies further The market strengthened in afternoon trade with the Sensex rising more than 250 points and the Nifty touched the 6000 level. The Sensex is up 251.44 points or 1.26 percent at 20235.05, and the Nifty is up 71.45 points or 1.21 percent at 5999.85. Advancing shares outpaced declining ones by 1328 to 978 on the Bombay Stock Exchange. Reliance Industries , Infosys and HDFC Bank are the leaders of this rally, gaining between 2.5-3 percent. Country's largest lenders State Bank of India (up 0.02 percent) and ICICI Bank (up 1 percent), which were under pressure from early trade, recouped losses.

02:40pm Top News The rupee strengthened to drop below it's opening value of 62 per dollar while bond yields softened on trade deficit data. JP Morgan downgraded banks today. The brokerage house cut its rating on IndusInd Bank and PNB from overweight to underweight. It also downgraded Kotak Mahindra Bank and SBI to neutral. Bharti-Walmart joint venture has been called off.

Both companies will independently own and operate different business formats in India. Bharti shares declined 0.5 percent. US President Barack Obama selected Janet Yellen as Federal Reserve chairman. Yellen's dovishness helped Asian markets recover. Japan's Nikkei did a 2 percent intraday

02:26pm The market extended its gains after trade deficit narrowed in September. Traders are buying more shares of Reliance Industries, Infosys, HDFC Bank and L&T. The Sensex is up 168.48 points or 0.84 percent at 20152.09, and the Nifty is up 48.35 points or 0.82 percent at 5976.75. Trade deficit in September narrowed to USD 6.7 billion compared to USD 10.91 billion in last month.

During the period, imports were down 18.1 percent at USD 34.4 billion year-on-year while exports jumped 11.15 percent at USD 27.68 billion (Y-o-Y). Infosys gained strength today after seeing a consolidation in previous two sessions, rising 1.6 percent ahead of its September quarter earnings on Friday. Experts believe technology companies are going to report strong numbers during the quarter due to rupee depreciation. Kotak Securities expects the company to increase the guidance range.

"The return of Mr Murthy to Infosys has raised hopes on the medium-to-long term prospects of the company," Kotak says. Index heavyweights Reliance Industries and HDFC Bank rallied 1.9 percent each while capital goods majors L&T jumped over 2 percent. Sun Pharma remained strong, rising more than 4 percent to touch a record high of Rs 645 on the Bombay Stock Exchange. However, top lenders State Bank of India and ICICI Bank lost 0.6-1 percent. Shares of M&M, Sesa Sterlite and Coal India fell a percent.

2:00 pm Global market check: European shares slipped to fresh one-month lows on Wednesday, with no signs of progress in a US political deadlock eating away at investor conviction that the country will avoid a sovereign default, reports Reuters. US President Barack Obama said he would only negotiate with Republicans once they agree to re-open federal government now in its second week of shutdown - and raise the debt ceiling with no conditions.

1:45 pm F&O expert: Vineet Bhatnagar, managing director of PhillipCapital expects market volatility to continue going forward. He says, whenever Nifty crosses or is around 6,000, there is a mild reduction in the open interest by the FIIs, in particular in Nifty futures. "They start accumulating or increasing the OI when it reaches around 5,850 or 5,800 thereabouts," he told CNBC-TV18. He sees a strong technical resistance for Nifty at about 6,020.

1:30 pm Buzzer: Investors are buying shares of DLF as the country's largest real estate developer divested its 60 percent stake in its subsidiary Star Alubuild. The stock gained nearly 4 percent in intraday trade. DLF in its filing on Tuesday said, "Subsidiaries namely DLF Home Developers and DLF Projects have divested 60 percent stake in Star Alubuild Private Limited, a subsidiary at an enterprise value of Rs 79.8 crore." Japan's LIXIL Corporation is the buyer for Star Alubuild. LIXIL has acquired total 70 percent stake in the company from Romi Malhotra, the founder of the company and DLF subsidiaries.

The surprise by September trade data deficit breathed life in the listless market. Trade deficit in September narrowed to USD 6.7 billion compared to USD 10.91 billion in last month. During the period, imports were down 18.1 percent at USD 34.4 billion year-on-year while exports jumped 11.15 percent at USD 27.68 billion (Y-o-Y).

The Sensex is up 120.03 points at 20103.64, and the Nifty adds 35.95 points at 5964.35. About 1144 shares have advanced, 926 shares declined, and 146 shares are unchanged. Pharma and realty stocks are lending support to the indices with top gainers being Sun Pharma , L&T, Reliance , Jindal Steel and HDFC Bank .

On the losing side are Coal India , Sesa Sterlite, ICICI Bank , M&M and Wipro . In a big corporate development, Bharti and Walmart have split the joint venture deal. Walmart will pick up Bharti Enterprises' entire stake in theJV. Both companies will independently own and operate different business formats in India.

12:58pm Market Update The 30-share BSE benchmark stayed above the 20000 level in afternoon trade. The index gained 89.74 points at 20073.35, and the Nifty is up 27.15 points at 5955.55. Advancing shares outnumbered declining ones by 1142 to 917 on the Bombay Stock Exchange. On the global front, European markets are marginally in the red as US government shutdown continues.

12:50pm Stocks In News Bharti Airtel is down 1 percent on news that the Bharti-Walmart joint venture has been called off. Walmart will pick up Bharti Enterprises' entire stake in the joint venture. Both companies will independently own and operate different business formats in India. Kaveri Seed surged over 9 percent and Bayer Cropscience  rallied over 5 percent on a media report that Bayer Cropscience may buy under 26 percent stake in the Hyderabad-based company Kaveri Seed. PTC India shares gained 5.5 percent after the company states that it has received Rs 778 crore from UP Power Corporation towards past outstanding dues against sale of power to the latter.

12:35pm Rupee rebounds The rupee and benchmark bonds gained after data showed the September trade deficit narrowed sharply from August, reducing concerns about the country's current account balance. India's trade deficit narrowed to USD 6.7 billion last month, compared with USD 10.9 billion in August. The rupee strengthened to 61.9650 per dollar from around 62.10 before the data, while the benchmark 10-year bond yield initially fell around 4 basis points but then recovered to trade at 8.44 percent, still down from its 8.50 percent close on Tuesday, reported Reuters.

12:20pm Gold Update Gold was stuck in a tight range on Wednesday as the US government shutdown dragged on for a second week, but the metal was supported by increasing fears the deadlock could spill over to talks about raising the US debt ceiling. Gold has been drifting between USD 1,300 and USD 1,330 an ounce in the past five sessions, with some safe-haven bids providing support despite a lack of US economic data or a strong rebound in physical demand.

President Barack Obama refused to give ground in a fiscal confrontation with Republicans on Tuesday, saying he would negotiate on budget issues only if they agreed to re-open the federal government and raise the debt limit with no conditions. Congress faces an October 17 deadline to increase the USD 16.7 trillion borrowing limit to avert the risk of a default on US debt, reported Reuters.

12:07pm The market rebounded in noon trade with the Nifty rising above its 5950 level supported by oil & gas, HDFC twins and healthcare stocks. The Sensex is up 107.44 points at 20091.05, and the Nifty is up 33.55 points at 5961.95. Vineet Bhatnagar, managing director of PhillipCapital expects market volatility to continue going forward. He says, whenever Nifty crosses or is around 6,000, there is a mild reduction in the open interest by the FIIs, in particular in Nifty futures.

"They start accumulating or increasing the open interest when it reaches around 5,850 or 5,800 thereabouts," he told CNBC-TV18. He sees a strong technical resistance for Nifty at about 6,020. Sun Pharma topped the buying list, rising more than 4 percent to touch a record high of Rs 640.30 amid large volumes. Index heavyweights Reliance Industries , HDFC, HDFC Bank and L&T gained 1-1.5 percent while in the Tata pack, Tata Steel , Tata Power and Tata Motors rose 1-1.7 percent. Meanwhile, the rupee too recovered, cutting losses from 42 paise to just 4 paise. It is trading at 61.83 against the US dollar.

12:00 am FII view: India is far more better positioned today than it was about two months back, believes Arindam Ghosh, managing director and chief executive officer of Blackridge. Speaking to CNBC-TV18, Ghosh says the Reserve Bank and the government's measures to boost growth and rescue the rupee have reaped benefits.

However, one can expect a good level of anxiety in the market on the back of the US Budget impasse, he adds. "Hence, in the run up to October 17, we may well get into a period when there could be some kind of a risk-on environment but I think once the resolution is reached, we will probably see a very sharp rally. So directionally, I think it is tough to take an aggressive bet at this point in time but overall, we are better now than earlier," he highlights.

11:45 am Trade deficit data: September trade deficit has surprised the street by narrowing to USD 6.7 billion compared to USD 10.91 billion compared to last month. During the period, imports were down 18.1 percent at USD 34.4 billion year-on-year while exports jumped 11.15 percent at USD 27.68 billion (Y-o-Y). Oil imports were down 5.9 percent while gold and silver import was at USD 0.8 billion (Y-o-Y) in September.

11:30 am Buzzer: Shares of Prestige Estates Projects surged nearly 6 percent in early trade Wednesday, continuing upmove for the fifth consecutive session. The stock had rallied 25.5 percent in five sessions. Bank of America Merrill Lynch has a buy rating on the stock with a target price of Rs 215, which is a potential 59 percent upside from current levels. "The management has confirmed pre-sales of Rs 2,000 crore during April-September period of FY14 and reinstated their guidance of Rs 4,300 crore in FY14," Bank of America report said.

The market is flat after a gap down opening. The Sensex is up 12.84 points at 19996.45, and the Nifty is up 4.65 points at 5933.05. About 1011 shares have advanced, 668 shares declined, and 100 shares are unchanged. Sun Pharma with a gain of 3 percent is leading stocks in the Sensex, follwoed by Tata Steel , Tata Motors , Tata Power and HDFC Bank . However, selected banking stocks are still under selling pressure with ICICI Bank and SBI being on the major losers' chart in the Sensex.

Bharti Airtel , Coal India and NTPC are other laggards. Asian markets such as the Japanese markets reversed earlier losses possibly reacting to the news of Janet Yellen's officially being nominated as the next Fed chairperson. Crude futures ended up on renewed concerns over oil supplies from the west Asian region post the recent rise in violence. Gold futures fell as the rise in dollar dampened demand.

Dollar continued to trade at 8-month lows but recouped losses. Rupee is trading at an over one-week low against the US dollar on poor domestic market sentiment tracking weak global cues. Meanwhile, government bond prices rise as dealers bought papers after Reserve Bank of India Governor Raghuram Rajan, on Tuesday, said that the recent cut in the marginal standing facility rate will have no implication on the monetary policy.

10:50am Market Update The market recouped its early losses supported largely by Reliance Industries (up 1 percent), HDFC (up 0.5 percent) and HDFC Bank (up 0.4 percent). The Sensex is down 10.33 points at 19973.28 after recovering 150 points from day's low while the Nifty is down 5.65 points at 5922.75. Deven Choksey, MD, KR Choksey Shares and Securities expects the market to be in a range or consolidate this month.

The Nifty could consolidate in the range of 5750-6050 in this period and closer to this range, we could see buying emerging since most traders are looking at margin of safety and refraining from entering into the market at higher price, he adds According to him banking stocks would be impacted because of the higher costs that they are assuming and also due to lower credit offtake and growth in the system. Top private sector lender ICICI Bank lost 2.5 percent and its rival State Bank of India declined 1.4 percent.

10:30am Stocks In News Investors are buying shares of PTC India in morning trade after the state-run company received Rs 778 crore from UP Power Corporation. The stock rallied more than 7 percent in intraday trade on Wednesday. Kaveri Seed Company gained 9 percent on a media report that Bayer Cropscience may buy under 26 percent stake in Hyderabad-based Kaveri Seed. According to a media report, the proposed deal may value Kaveri Seed between Rs 1,422 crore and Rs 2,133 crore-or close to two to three times its annual net sales. The current market capitalisation is approximately Rs 2,000 crore.

10:15am Banks under pressure Banks are under pressure after a slew of downgrades by JP Morgan. ICICI Bank lost the most among largecaps, falling 2.5 percent while its rival State Bank of India declined more than 1 percent. JP Morgan downgraded IndusInd Bank (down 0.19 percent) to underweight and cut price target by 25 percent to Rs 375 apiece.

In addition, the brokerage house also downgraded Kotak Mahindra Bank (up 0.02 percent) to neutral from overweight and cut target price by 10 percent to Rs 750. It downgraded PNB (down 0.34 percent) as well, to underweight from overweight and cut target price on the stock to Rs 450 from Rs 550. JP Morgan also downgraded country's largest lender SBI to neutral from overweight and cut its target price to Rs 1800 from Rs 2050.

10:00am The market halved its early losses on account of buying in index heavyweights Reliance Industries and HDFC. Short covering in select banks too aided the recovery in morning trade. The Sensex is down 60.44 points to 19923.17, and the Nifty is down 16.05 points at 5912.35. The fall in today's trade is largely attributed to cut in growth forecast by IMF. International Monetary Fund cut its India's FY14 GDP growth forecast to 3.8 percent from 5.6 percent in July and FY15 GDP growth forecast to 5.1 percent from 6.3 percent in July.

Telecom operator Bharti Airtel slipped 1.5 percent followed by Sesa Sterlite and NTPC with 1 percent loss. Coal India remained under pressure for the third consecutive session today, losing over a percent. The board of directors will meet today to consider a proposal of buy back of equity shares. However, shares of Tata Motors and Sun Pharma gained 1-1.5 percent. Index heavyweights Reliance Industries, HDFC, L&T and Infosys are marginally in the green after getting recovered from day's low.

Meanwhile, the rupee fell 39 paise to 62.19 against the US dollar. There are many issues that can and will cause major tremors in emerging market bonds and currencies over the next three-six months, says Viktor Shvets of Macquarie. Though the depreciating dollar will be good for emerging markets in the short term, but in the long term, US dollar will appreciate and volatility in these assets will return, he told CNBC-TV18 in an interview.

10:00 am Analysis: According to a CNBC's analysis  India's battered rupee was the best performing global currency last month amid growing confidence that a currency crisis would be contained and as fears about the Federal Reserve tapering its quantitative easing program ebbed. The rupee rose about 9 percent against the US dollar in September, also outperforming major global currencies. The rise marks a surprising comeback after the rupee sank to a record low just shy of 70 per dollar in late August, earning it the title of the world's worst performing currency this year.

9:45 am Breaking: Bharti and Walmart have scrapped the joint venture deal. Both the companies will now independently own and operate separate business formats in India. They have decided to discontinue franchisee pact in retail and Walmart will acquire Bharti's stake in Bharti-Walmart.  However, Bharti Enterprise has said that it will continue to invest in retail arm across all formats. Meanwhile, Walmart feels that independent operation decision will benefit both the companies.

Although India permitted 51 percent FDI in the multi-brand retail sector in September 2012, apprehension regarding the rules has deterred the big retailers to announce their plans for Indian market. The mandatory 30 percent sourcing from Indian small and medium enterprises (SMEs) and a minimum USD 100 million investment into fresh facilities of which 50 percent would be in the backend, was said to be a roadblock for Walmart.

9:35 am FII views: Bharat Iyer of JP Morgan expects the earnings season to have limited impact on market performance. "Market direction will largely be determined by macro developments, both global and local. Indian equities are at fair value. Our regional strategy team has a neutral stance on India in the emerging market portfolio," he says. Bhuvnesh Singh of Barclays has a strong defensive stance in their India portfolio.

He adds that concerns remain over return on equity declines for cyclical sectors, weak asset growth rate and increasing cost of financing. "The possibility of a secular 3-5 percent per annum decline in the rupee is likely to favour export-driven sectors. However, despite our defensive stance on India, we highlight three cyclical stocks that could still be outperformers: Tata Steel , Tata Motors and L&T," he said in an interview to CNBC-TV18.

9:20 am Movers and losers: After a run up in last trading session, banking stocks are under selling pressure today. Bank Nifty is down 1.6 percent. ICICI Bank, SBI , HDFC Bank are major laggards in the Sensex. Days after the finance ministry nudged banks to bring down lending rates to spur festive demand, banks finally obliged. State Bank of India , Punjab National Bank , Oriental Bank of Commerce cut rates between 25 basis points to over a percent. HUL , Sun Pharma , TCS , Cipla and Tata Motors are lead gainers in the Sensex.

The market has opened in negative terrain dragged by banking stocks. The Sensex is down 113.70 points at 19869.91, and the Nifty is down 35.30 points at 5893.10. About 107 shares have advanced, 202 shares declined, and 19 shares are unchanged. In a setback, IMF International Monetary Fund (IMF) has lowered India's growth forecast to 3.75 percent compared to its previous estimates, but still sees economy to have troughed last year.

Indian rupee fell below the 62 level in early trade, losing 28 paise to 62.07 per dollar on Wednesday as against previous day's closing of 61.79. "The dollar-rupee pair has been consolidating in a narrow range of late awaiting the outcome of US shutdown and clarity on tapering," says Ashutosh Raina of HDFC Bank. He feels the pair is expected to move in a narrow range with a slight weakening bias. The range for the day is seen between 61.70-62.50/USD, he adds. Meanwhile, after months of speculation Janet Yellen has been officially named as the next chair of the Federal Reserve, succeeding Ben Bernanke. Yellen is seen as a dove on monetary policy and Dow futures shot higher reacting to this news.

If approved by the senate, this would make Yellen the first woman to head the central bank in its 100-year history. US markets finished sharply lower for a second session and the CBOE volatility index jumps above 20 surging nearly 23 percent in October alone. European markets too closed with cuts. The FTSE 300 Index closed provisionally down 0.7 percent to 1,232.61 points, with Britain's FTSE 100 closing down 1 percent, a fresh three-month low.

Japan's Nikkei, the Shanghai Composite and Australia's S&P ASX 200 all erased their early losses to enter into positive territory and South Korea is shut for a public holiday. Crude prices on both sides of the Atlantic rose on Tuesday, with Nymex settling higher as the dollar remained weak and geopolitical risk crept back into the markets.  Gold ticked higher on Wednesday as the US Budget impasse dragged on for a second week and threatened to spill over to talks about raising the US debt ceiling, boosting the metal's safe-haven appeal.