With investors mostly staying away on the sidelines and refraining from building up positions amid a slew of weak economic reports and on concerns about weak global economic outlook, the Indian market ended flat after a highly lackluster session on Monday.
A lack of triggers from global markets and caution ahead of Diwali holidays - the market will remain closed on Tuesday and Wednesday - too contributed to the sluggish trend. Though the market will be open for trading for a short duration on Tuesday evening, not much activity is likely that day as institutional investors are most likely to stay away from the ring.
After a weak start and a subsequent modest recovery, the market faltered post release of the industrial production data for September. Thereafter, it moved in a tight band marginally below previous closing levels as reports revealing a surge in inflation and widening trade deficit rendered the mood quite cautious.
The BSE benchmark Sensex, which rose to 18,750.92 and touched a low of 18,607.66 subsequently, ended the day with a loss of 13.34 points or 0.07% at 18,670.34. The Nifty index of the National Stock Exchange settled at 5683.70, around 35 points off the day's high of 5718.90, recording a loss of 2.55 points or 0.04%.
Among the gainers in the Sensex, HDFC Bank moved up 1.85%. Bharti Airtel notched up a gain of 1.7% and State Bank of India gained 1.6%. Tata Consultancy Services, Infosys and Dr Reddy's Laboratories posted modest gains.
IDFC, up 3.3%, was the top gainer in the Nifty index. Jaiprakash Associates, Axis Bank, Bank of Baroda, HCL Technologies, Reliance Infrastructure, Sesa Goa, Punjab National Bank and Kotak Bank also closed on a firm note.
Tata Steel ended 1.7% down with quarterly results hurting the stock once again. Hero Motocorp eased by around 1.6%. ITC also lost over 1.5%. Tata Power drifted down by 1.4%. Jindal Steel & Power, GAIL India, Maruti Suzuki, Larsen & Toubro, ONGC, Sun Pharmaceutical Industries and Coal India also closed weak.
Realty stock DLF ended 2.6% down. Ranbaxy Laboratories and BPCL lost a little over 2%. ACC, Siemens, Ambuja Cements and Ultratech Cement also closed notably lower.
United Spirits shot up by 35% on heavy volumes following the British liquor giant Diageo Plc. making an open offer to acquire 26% stake held by public in United Spirits, at a price of Rs 1440 per share. The British firm had signed a deal on Friday to buy 27.4% stake in the Indian liquor major. With the open offer for 26% stake, Diageo will own 53.4% in United Spirits. The United Spirits counter on the National Stock Exchange clocked a volume of over 25 million shares today.
HDIL (up nearly 6.5%), Reliance Communications (up 3.4%) and L&T Finance Holdings (up 12.8%) were among the other stocks that surged higher on huge volumes today. The HDIL counter on NSE saw a volume of nearly 25 million shares, while Reliance Communications and L&T Finance Holdings counters clocked over 47 million shares and 37.9 million shares, respectively.
The market breadth was slightly weak. Out of 2919 stocks traded on BSE, 1461 stocks declined. 1334 stocks moved up and 124 stocks ended flat.
According to the data released by the government this morning, industrial production declined by a weaker-than-expected 0.4% in September from a year earlier. The government revised August output growth to 2.3% from 2.7%.
Manufacturing, which constitutes about 76% of industrial production, fell by 1.5% from a year earlier, the government said. In the April-September period, industrial production expanded an annual 0.1%.
In the year ago period, manufacturing sector saw a growth of 3.1%. Mining sector grew at 5.5% as comapred to a contraction of 7.5% in the same month last year. Electricity sector growth came in at 3.9%, against 9% in the corresponding month last year, while Capital Goods growth contracted 12.2% as compared to a contraction of 6.5% last September.
Meanwhile, retail inflation, measured by Consumer Price Index, increased marginally to 9.75% in October 2012 from 9.73% in September 2012.
In rural areas, consumer price inflation increased to 9.98% in October from 9.79% in September, while in urban areas it was at 9.46% in October against 9.72% in September, showed the data released by the government today.
According to the data released by the Ministry of Commerce & Industry, India’s exports declined for the sixth consecutive month by 1.6% to $23.2 billion in October 2012, against $23.6 billion in the corresponding month of the previous year. Imports in October this year rose by 7.37% to $44.2 billion, compared with $41.1 billion in October 2011.
Trade deficit for the first seven months of 2012-13 was at $110 billion against $106.8 billion in the corresponding period of last year, showed the data released by the Ministry.