Nifty ends below 8700 ahead of Fed meet outcome; NTPC drops

The market closed a rangebound session on a weak note with benchmark indices losing 0.4 percent each ahead of Federal Reserve policy meeting outcome tonight. FMCG, infrastructure, technology and select auto stocks saw selling pressure.

The 30-share BSE Sensex fell 114.26 points to 28622.12 and the 50-share NSE Nifty declined 37.40 points to 8685.90 on profit booking after rising a percent in previous session.

However, the broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising 0.3 percent each. About 1270 shares advanced against 1584 shares declined on the Bombay Stock Exchange.

Experts believe the market may remain rangebound. Vibhav Kapoor of IL&FS feels the Nifty can trade in the 8000-9000 range over the next few months.

According to him, the US Federal Reserve decision will be a key factor for markets – Indian as well as global. If in fact the Fed signals a rate hike, dollar will start strengthening, which is not good for emerging market equities, he said, as it may lead to capital flight.

Global markets awaited the US Federal Reserve's policy announcement with caution. European equities were mixed while most Asian benchmarks ended higher with the Shanghai rising over 2 percent.

Back home, NTPC was the biggest loser on Sensex, down more than 3 percent as sources told CNBC-TV18 that the government moved a cabinet note to divest 10 percent stake in the country's largest power generation company. The sale is likely to fetch the government over Rs 12,000 crore at the current market price, sources added.

Tata Motors was the leading contributor to the index fall, down 2 percent post Jaguar Land Rover global sales data for February. JLR's wholesale volumes fell 1 percent year-on-year. Jaguar volumes declined by 3 percent to 6,448 units while Land Rover volumes were down 1 percent to 32,093 units.

HDFC, ITC, ONGC, Wipro, HUL, M&M, Bharti Airtel and BHEL dropped 1-2 percent whereas Reliance Industries and SBI gained more than 1.3 percent.

Sesa Sterlite was up 0.6 percent and Kalyani Steels rallied 5.5 percent after Goa CM Laxmikant Parsekar said environment ministry has withdrawn suspension on environment clearances for mining leases.

In the broader space, Jet Airways climbed nearly 4 percent as the company paid all TDS dues including interest to I-T department.

03:30 pm Market close: The market ended on lower note. The Sensex was down 114.26 points at 28622.12 and the Nifty slipped 37.40 points at 8685.90. About 1275 shares advanced, 1582 shares declined and 198 shares were unchanged.

Reliance, SBI, HDFC Bank, Coal India and Hero MotoCorp were top gainer in the Sensex. Among the losers are NTPC, BHEL, Tata Motors, Wipro and M&M.

03:15 pm Global stocks: European shares followed Asian stocks higher and the dollar held steady before a Federal Reserve meeting that's expected to lay the groundwork for the first increase in US interest rates in nearly a decade.

The Fed is widely expected to remove the word "patient" from its statement on the timing of its first hike since 2006, possibly paving the way for policy tightening as early as June.

Chinese stocks rose for a sixth successive session in anticipation of fresh government stimulus. The CSI300 index of the largest listed companies in Shanghai and Shenzhen rose 2.4 percent. China's average new home prices fell at their fastest pace on record last month, data showed on Wednesday.

03:00pm Market Update: The Sensex dropped 135.28 points to 28601.10 and the Nifty declined 46.80 points to 8676.50. About 1202 shares have advanced, 1578 shares declined, and 195 shares are unchanged on the BSE.

02:45pm Crude outlook: A global oversupply of oil is set to rise as China pauses in the build-up of its strategic reserves and Asian refineries slow crude imports ahead of the spring maintenance season, putting more downward pressure on prices.

China's purchases to fill its strategic petroleum reserves (SPR) had been one of the main drivers of Asian demand since August of last year, with the No.2 oil consumer taking up cheap crude to fill its tanks despite slowing economic growth.

Yet China could pause its reserve purchases soon as tank sites reach their limits and new space only becomes available later this year.

02:30pm Star Ferro Cement on broker's radar: SFCL is the largest cement player in the North-East region (NER) with over 23 percent market share. Being located in a geographically complex region, SFCL enjoys a competitive advantage in the NER, which also imports cement from other neighbouring states leading to higher cement prices in the NER region.

Demand growth in this region has consistently remained higher than the growth at pan-India level. In order to reduce imports, the company has expanded its capacity from 1.5MT in FY13 to 3.6 MT in FY15. This, in turn, has helped SFCL to gain market share in the NER.

With the government's thrust on infrastructure development, ICICIdirect expects demand growth in this region to remain healthy over the next 3-4 years. Given this backdrop, the brokerage expects the company to clock revenue CAGR of 25.5 percent in FY15-17E.

ICICIdirect initiates coverage on Star Ferro Cement with a buy recommendation.

02:00pm Market Check
The market continued to see marginal selling pressure amid consolidation. The Sensex fell 87.90 points to 28648.48 and the Nifty declined 29.70 points to 8693.60 while the BSE Midcap and Smallcap indices gained 0.4 percent each.

However, global markets traded higher ahead of Federal Reserve policy meeting outcome tonight. Shanghai rallied over 2 percent followed by Nikkei and Hang Seng with 0.5-0.9 percent gain while European markets were marginally in green.

Aroop Chatterjee, Barclays said at the FOMC meeting today, the brokerage house expects the Fed to end forward guidance by dropping the 'patience' language in favor of language that highlights the need for a gradual removal of policy accommodation.

"While such an outcome does not necessarily mean that the first rate hike will come in June, we think that the outlook for employment & activity is robust enough to warrant it. Weak housing starts data look largely to have been weather related & forward-looking indicators such as permits point to an improving outlook," he added.

Tech Mahindra, HCL Technologies, Wockhardt, Yes Bank, Suzlon Energy and CARE are most active stocks on exchanges.

1:50 pm Market check: The Sensex is down 110.65 points at 28625.73 and the Nifty slips 42.70 points at 8680.60. About 1223 shares have advanced, 1460 shares declined, and 177 shares are unchanged.

Sesa Sterlite is up 2 percent while SBI, GAIL, Hero and Cipla are top gainers. NTPC is down 4 percent. BHEL, Tata Motors, HUL and ONGC are other laggards in the Sensex.

1:40 pm FII view: Sanjay Sinha, founder, Citrus Advisors says if the US Federal Reserve does not raise rates, then the downside on the market gets capped. However, he does not see the Nifty crossing the 9000 mark.

According to Sinha, portfolio should consist of 60 percent cyclical and 40 percent defensive stocks. Pharma and IT sectors should be a part of the defensive portfolio, he says. He also advises investors to buy auto stocks on correction.

1:30 pm Buzzing: Shares of Mahindra & Mahindra were down over 1 percent intraday on Wednesday with investors growing concerned about its sales. In an analysts meet, the management has acknowledged that tractor volumes decline has been worse than its pessimistic scenario and the unseasonal rainfall has made things worse.

The company has said that industry may continue to decline in first half of FY16 and expects single digit growth of 5-7 percent in tractors in FY16. Tractor sales are affected due to low minimum support price (MSPs) and rural wages. However, M&M is hopeful that sales may pick up only in second half subject to monsoon.

Credit Suisse is not perturbed and maintains an outperform rating. ''Worst is now behind and M&M's performance should gradually improve hereon. The stock's valuations are attractive,'' it says in a note.

The market continues to be in red. The Sensex is down 14.39 points at 28721.99 and the Nifty down 5.15 points at 8718.15. About 1243 shares have advanced, 1338 shares declined, and 191 shares are unchanged.

Sesa Strelite, Tata Power, Hero Motocorp, HDFC Bank and SBI are top gainers in the Sensex. Among the losers are NTPC, Tata Motors, ONGC, Wipro and M&M.

The Securities and Exchange Board of India (SEBI) is planning rule changes that will make it easier for homegrown start-ups to list their shares on local bourses, sources involved in the process said, helping domestic investors to bet on the country's booming online economy.

The SEBI is considering easing rules on mandatory disclosure for the draft prospectuses of Internet-based companies. One of the main items that could be scrapped is the need to detail the use of proceeds from the initial public offering of shares, they said. This is currently an obstacle for start-ups, as these companies don't typically use cash to build plants or purchase tangible assets.

Gold prices increased by 0.15 percent to Rs 25,796 per 10 grams in futures trading today as speculators enlarged positions amid a better trend overseas.  Analysts said a better trend in the global markets supported the upside in gold prices at futures trade here. Meanwhile, in Singapore, gold rose to USD 1,151.35 an ounce from USD 1,149.57 yesterday.

12:55pm Market Update: The market remained volatile with the Sensex falling 27.66 points to 28708.72. The Nifty declined 12.05 points to 8711.25.

About 1225 shares have advanced, 1343 shares declined, and 186 shares are unchanged on the BSE.

12:45pm IPO News: The Securities and Exchange Board of India (SEBI) is planning rule changes that will make it easier for homegrown start-ups to list their shares on local bourses, sources involved in the process said, helping domestic investors to bet on the country's booming online economy.

The SEBI is considering easing rules on mandatory disclosure for the draft prospectuses of Internet-based companies, the sources said.

One of the main items that could be scrapped is the need to detail the use of proceeds from the initial public offering of shares, they said. This is currently an obstacle for start-ups, as these companies don't typically use cash to build plants or purchase tangible assets.

"A lot of them operate without any tangible assets," said one of the sources directly involved in the process.

"That creates an issue when declaring the use of proceeds (in the draft prospectus)."

All the sources declined to be named, as they were not authorised to speak to the media given the rules are still being finalised. A spokesman for SEBI did not respond to Reuters calls and e-mail requesting comment.

12:30pm FII View: The market level today is recalibrating the fact that despite the new government coming in nine months ago, the country's macroeconomic situation is yet to see a significant turnaround, is the word coming in from Sanjay Sinha, founder, Citrus Advisors. Corporate profits have not seen pick up yet, he says.

On today's big event, he says if the US Federal Reserve does not raise rates, then the downside on the market gets capped. However, he does not see the Nifty crossing the 9000 mark.

According to Sinha, portfolio should consist of 60 percent cyclical and 40 percent defensive stocks. Pharma and IT sectors should be a part of the defensive portfolio, he says. He also advises investors to buy auto stocks on correction.

12:00pm Market Check: The market continued to be in a consolidation mode with the frontline indices slipping in and out of the red territory dragged by select power stocks. However, the broader markets outperformed again with the BSE Midcap and Smallcap indices rising half a percent each.

The Sensex declined 7.97 points to 28744.35 and the Nifty fell 5.15 points to 8718.15. About 1182 shares have advanced, 1284 shares declined, and 177 shares are unchanged on the BSE.

All eyes are on the US Fed decision due later tonight. Investors will watch for whether "patient" remains in the text or not. Market guru Marc Faber does not expect the Fed to increase interest rates this year.

Asian markets traded mostly higher. China's Shanghai market hit a fresh multi-year high on hopes of further stimulus. In other asset classes, dollar remained steady and Brent crude slipped towards USD 53 per barrel.

Jindal Steel rose 1 percent after the steep fall it saw yesterday. The management clarified to CNBC-TV18 that it followed a fair bidding process and have not heard from coal ministry on any re-bidding. It hopes the government will respect outcome of coal block auction.

Sesa Sterlite climbed over 2 percent as enviornment ministry revoked suspension of mining leases in Goa. Deutsche Bank believes it is a long term positive development for the stock.

11:50 am Market guru: The US Federal Reserve decision will be a key factor for markets – Indian as well as global, says Vibhav Kapoor of IL&FS. If in fact the Fed signals a rate hike, dollar will start strengthening, which is not good for emerging market equities, he says, as it may lead to capital flight. In any case, Kapoor sees limited upside for the market, considering valuations are too rich.

Coupled with the Fed move – if it raises rates – the Indian market can go sideways to down in the near-term. According to him, Indian market will start looking attractive once again in the 8200-8300 range. He believes Nifty can trade in the 8000-9000 range over the next few months. He advises investors to reduce weightage on cyclicals and play the defensives – IT and pharma – instead as these sectors are likely to benefit on dollar appreciation. Kapoor does not wish to advocate midcaps at this stage and says large caps will lead the next rally.

11:30 am FII view: The market level today is recalibrating the fact that despite the new government coming in nine months ago, the country's macroeconomic situation is yet to see a significant turnaround, is the word coming in from Sanjay Sinha, founder, Citrus Advisors. Corporate profits have not seen pick up yet, he says.

On today's big event, he says if the US Federal Reserve does not raise rates, them the downside on the market gets capped. However, he does not see the Nifty crossing the 9000 mark.

According to Sinha, portfolio should consist of 60 percent cyclical and 40 percent defensive stocks. Pharma and IT sectors should be a part of the defensive portfolio, he says. He also advises investors to buy auto stocks on correction.

The market is reeling under pressure ahead of Federal Reserve meeting. The Sensex is down 97.46 points at 28638.92 and the Nifty is down 27.85 points at 8695.45. About 1062 shares have advanced, 1115 shares declined, and 170 shares are unchanged.

Sesa Sterlite, JSW Steel and Kalyani Steel are in focus as the environment ministry lifted the three-year ban on Goa mining yesterday. Deutsche Bank says it is a long term positive development for Sesa Sterlite which was one of the major iron ore producers in the state before the restrictions.

Hero Motocorp, SBI, Reliance and Axis Bank are top gainers in the Sensex. Among the losers are NTPC, ONGC, HDFC, HUL and BHEL.

Reliance Infra & Tata Power are in focus as the Maharashtra government has cut electricity rates by 12 percent for Feb 2015 and 19 percent for March 2015. The rates are applicable till MERC approves new rates.

Globally, Asian markets trade mixed mirroring a mixed finish on Wall Street. Brent slips toward USD 53 after us crude stocks rise while gold holds near 4 month lows. The dollar hovers around its 12-year peak.

10:50am Public Issue: Inox Wind, promoted by Gujarat Fluorochemicals, has opened its public issue for subscription today. The issue consists of a fresh issue of equity shares aggregating up to Rs 700 crore and an offer for sale of 10,000,000 equity shares by Gujarat Fluorochemicals.

The issue includes a reservation of 5 lakh shares for subscription by eligible employees on a competitive basis.

The price band is fixed at Rs 315-325 per share for the issue, which will close on March 20, 2015. The minimum bid lot is 45 equity shares and in multiples of 45 equity shares thereafter.

The wind power solutions provider has decided to allocate shares worth Rs 306 crore to anchor investors. It will allocate little over 94.25 lakh shares at a price of Rs 325 apiece to anchor investors.

Goldman Sachs India Fund, Swiss Finance Corp (Mauritius) Ltd, Indus India Fund (Mauritius) Ltd, IDFC Infrastructure Fund and Sundaram Mutual Fund A/C Sundaram Equity Multiplier, are among the anchor investors.

10:20am Market Expert: The US Federal Reserve decision will be a key factor for markets – Indian as well as global, says Vibhav Kapoor of IL&FS. If in fact the Fed signals a rate hike, dollar will start strengthening, which is not good for emerging market equities, he says, as it may lead to capital flight.

In any case, Kapoor sees limited upside for the market, considering valuations are too rich. Coupled with the Fed move – if it raises rates – the Indian market can go sideways to down in the near-term.

According to him, Indian market will start looking attractive once again in the 8200-8300 range. He believes Nifty can trade in the 8000-9000 range over the next few months.

10:00am Market Check
The market is still under pressure as the Nifty is struggling below 8700. The 50-share index is down 31.50 points at 8691.80. The Sensex is down 105.94 points at 28630.44. About 889 shares have advanced, 852 shares declined, and 136 shares are unchanged.

Tata Motors, Hindalco, M&M, HUL and HDFC are among the laggards while Sesa Sterlite, Hero MotoCorp, GAIL, Cipla and Reliance are top gainers in the Sensex.

Meanwhile, concern over a US interest rate hike kept sentiment in check at some of Asia's biggest firms, as optimism about the outlook for business over the next six months was near steady in the first quarter, a Thomson Reuters/INSEAD survey showed. Companies in India were the most upbeat for the fourth straight quarter, logging 97 on hopes that low inflation and aggressive interest rate cuts will boost the domestic economy.

Singapore firms registered the least positive outlook for the third consecutive quarter in anticipation of the first US rate hike in almost a decade, which could happen as early as June. Local banks are likely to match the hike, making mortgages expensive and pulling down demand for property.

9:55 am FII view: Aroop Chatterjee, Barclays says, "At the FOMC meeting today, we expect the Fed to end forward guidance by dropping the 'patience' language in favor of language that highlights the need for a gradual removal of policy accommodation. While such an outcome does not necessarily mean that the first rate hike will come in June, we think that the outlook for employment & activity is robust enough to warrant it. Weak housing starts data look largely to have been weather related & forward-looking indicators such as permits point to an improving outlook."

9:45 am Market check: The market is slipping away. The Sensex 124.19 points at 28612.19, and the Nifty is down 33.45 points at 8689.85. About 883 shares have advanced, 742 shares declined, and 139 shares are unchanged.

Hindalco, Tata Motors, M&M, HUL and HDFC lost around 1 percent each.

9:30 am IMF chief: Showering fulsome praise on Raghuram Rajan, IMF chief Christine Lagarde on Tuesday said not listening to his prediction of 2008 credit crisis was a big mistake of the multilateral funding agency. Lagarde said India's monetary policy "rests in good hands" and Rajan was taking several encouraging steps including allowing a greater role for private sector banks. She praised Rajan for "deftly" steering the Indian economy after the US Fed hinted at withdrawing its easy money policy in May 2013. "Raghu certainly has been very busy since he took over as the RBI Governor in September 2013.

The market has opened on a flat note on Wednesday ahead of outcome of two-day FOMC meet that scheduled to be announced tonight. The Sensex rose 18.77 points to 28755.15 and the Nifty advanced 1.55 points to 8724.85.

About 549 shares have advanced, 261 shares declined, and 96 shares are unchanged on the BSE.

Sesa Sterlite climbed 3 percent as environment ministry has revoked suspension on mining leases in Goa. Jindal Steel rebounded with 2.30 percent gains after falling 8 percent in previous session. Infosys, Cipla, Coal India, NTPC and Lupin gained 0.4-0.9 percent.

However, Tata Motors, Tata Power, Hindalco, ICICI Bank, M&M and DLF fell 0.4-1 percent.

The Indian rupee has opened flat at 62.68 per dollar on Wednesday against previous day's closing value of 62.70 a dollar.

The dollar slips for a second straight day against major currencies, pressured yet again by unexpectedly weak US economic data as the Federal Reserve started a two-day policy meeting. The euro is back above 1.06 to the dollar.

Himanshu Arora of Religare said, "The USD-INR pair is expected to trade slightly weak in today's session following strength in other Asian currencies and as weaker than expected data in the US reinforced views the Fed may not be in a hurry to hike interest rates anytime soon. The range for USD-INR pair is seen between 62.50-62.90/dollar."

Asian shares posted a subdued opening on Wednesday, tracking a mixed finish on Wall Street overnight as uncertainty over when the Federal Reserve will raise rates prevailed.

Japan's Nikkei 225 index retreated from Tuesday's fresh 15-year high as markets reacted to a smaller-than-expected increase in February's export data. China's Shanghai Composite opened up 0.4 percent to a fresh seven-year high as a widening fall in February's new home prices fueled hopes of further stimulus.

Australia's S&P ASX 200 index halved losses in mid-morning trade, as some index heavyweights turned positive.

All eyes will be on the Fed as it announces its policy decision later tonight. Investors looking at whether or not "patient" remains in the text as an indication of when short-term interest rates might go up

In the US, stocks closed mostly lower ahead of the Fed's statement that could shed light on the timing of an interest rate hike. Stocks came off session lows in the close, with only the Nasdaq in the black. The major indices held on to gains for the year.
And in Europe, equities closed lower, pulling back from highs reached on Monday, as investors there weighed economic data and focused on the Fed meeting.

In commodities, crude prices decline amid fears of an oil glut in the US. Nymex crude traded around 42 dollars while brent slipped to 53 dollars per barrel.

From precious metals space, gold fell to a four-month low on investor jitters ahead of the policy meeting that may offer further clues to support expectations of a mid-2015 rise in US interest rates.