Market summary for the day: 14/05/2014

Snapping four days gaining streak, Indian equity indices witnessed consolidation with nifty closing absolutely flat, while Sensex ended in the red with a cut of around quarter a percent as investors opted to book profit ahead of final results of elections on May 16. 

A bout of volatility was witnessed during the session with key benchmark indices slipping into the red after opening in green. Sentiment remained down beat with OECD saying that India, China and other major emerging economies are expected to see weak growth even as momentum remains stable in the developed world. Investors’ sentiment also remained subdued as Consumer price inflation (CPI) numbers released on Monday showed that retail inflation rose from 8.3 per cent in March 2014 to 8.6 per cent in April 2014. 

Sluggish opening in European counters too dampened the sentiments. CAC, DAX and FTSE eased from multi-year highs in early deals and the euro licked its wounds after declining to a five-week low, as the focus shifted to an economic outlook from the Bank of England for clues on when UK interest rates will rise. Though, the Asian markets shut shop mostly in the green but Chinese market ended marginally in red after country’s central bank called on the biggest lenders to accelerate the granting of mortgages. 

Back home, selling in healthcare counters too dampened the sentiments, led by over three and a half percent fall in Dr Reddy’s Lab after reporting a lower than 15.6% year on year (yoy) drop in consolidated net profit at Rs 482 crore for the quarter ended March 31, 2014 (Q4FY14), mainly due to higher operating expenses. Meanwhile, shares of public sector oil marketing companies like BPCL, HPCL and IOC edged lower after oil prices extended gains in Asian trade. 

On the flip side, shares related to PSU banks viz. Bank of India, Punjab National Bank, Canara Bank, Union Bank of India, Andhra Bank, Allahabad Bank, State Bank of India, Bank of Baroda etc. edged higher after a committee appointed by RBI made some radical suggestions regarding the government’s control over nationalised banks. Moreover, shares of infrastructure and real estate companies remained on buyers’ radar amid expectations that a new government at the centre would give the much-needed thrust to economy recovery. 

Finally, BSE Sensex declined by 56.11 points to 23,815.12, while the CNX Nifty ended unchanged at 7,108.75.  On the BSE Sectoral front, Realty up by 4.32%, Metal up by 3.22%, Consumer Durables up by 2.28%, PSU up by 1.84% and Power up by 0.83% were the top gainers, while Oil & Gas down by 0.78%, Capital Goods down by 0.36%, IT down by 0.31%, Healthcare down by 0.30% and Auto down by 0.03% were the losers in the space. 

The top gainers of the Nifty were Bank of Baroda up by 9.60%, Jindal Steel & Power up by 6.51%, Tata Steel up by 5.95%, DLF up by 5.45% and NMDC up by 5.07%. On the other hand, Mahindra & Mahindra down by 3.67%, Dr. Reddy's Laboratories down by 3.48%, HDFC India down by 1.91%, Reliance Industries down by 1.74% and HDFC Bank down by 1.71% were the top losers. 

The European markets were trading in red, France's CAC 40 was down by 0.20%, Germany's DAX was down by 0.15% and United Kingdom's FTSE 100 was down by 0.13%. 

TECHNICAL PARAMETERS OF NIFTY: 

RSI was at 76, MACD positive above signal line; India VIX was at 32~. Today, Nifty closed above all of its moving averages like 5DMA (6950), 20 DMA (6795), 50 DMA (6645), 200 DMA (6168) which all indicate that market is in strong bull run with huge fund flow from FIIs but investors may book some partial profit at these levels as market has seen a huge run up in the short span of time.