Sensex in bearish mode; realty, metals shine

The 30-share Sensex dropped 298 points to end at 27,209 and the 50-share Nifty has lost 93 points to end at 8,174..

Markets ended lower for the second straight session weighed down by Oil & Gas shares on continued fall in crude oil prices over recent months.

Weakness in the China markets along with selling in the Index heavyweights further dampened the sentiments of the investors. Today was the expiry of December derivative contracts.

The 30-share Sensex dropped 298 points to end at 27,209 and the 50-share Nifty has lost 93 points to end at 8,174.

Sahaj Agrawal, Deputy Vice President – Derivatives Research, Kotak Securities adds, “Volatility was at its best in the month of December.

Trading range in the index was seen at 7950-8600.

In the first half the index tested 8600 levels but failed to sustain the same.

A selloff was triggered which pushed the index to 7950 on the downside. A bounce back was seen towards 8300 towards the end of the series.

Nifty ended the series with a loss of 3.73 percent. For the Jan series Range for the index is seen at 8090-8550.

We expect the index to take support of 8090 and bounce back towards 8550-8700 levels. On the other hand caution is advised below 8090. We expect Banking to continue with out-performance while metals and IT expected to remain under pressure.”

Meanwhile, the cabinet approved an executive order today to implement coal and insurance reforms.

The selling by foreign institutional investors continued unabated and they were net sellers in Indian equities worth Rs 444.93 crore on Tuesday, as per provisional stock exchange data.

Rupee:

The rupee is trading lower at 63.44 versus Tuesday's close of 63.28.

The dollar index is trading above the key 90 level for the first time since March 2006 after strong US and UK economic data.

Month-end dollar demand from oil companies is also hurting the Indian unit.

Key Stocks:

On the sectoral front, BSE IT and Oil & Gas indices were down over 1.3% each followed by BSE FMCG, Healthcare indices which dipped 1% each.

However, BSE Realty index was the top gainer and was up 1%.

Coal India lost 1.7%. Coal India joined hands with GAIL and FCIL and RCF to revive FCIL’s Talcher urea plant in Odisha.

The cabinet approved an executive order on Wednesday to implement coal reforms.

The bill will set the ball rolling for re-allocation of 204 cancelled coal blocks through a transparent e-auction process. Hindalco was down over 1.4%.

With an above-global average output growth, India has retained its position as the world's fourth-largest steel producer this year but faces tough times ahead in 2015 amid growing imports and other concerns.

Tata Steel and Sesa Sterlite gained 0.1% and nearly 1% each. Pharma shares were under pressure with Dr Reddys Labs down2%.

In a report issued on Tuesday, Health Canada said that the importers have decided to stop the importation and distribution of products manufactured by Dr Reddy's Labs and IPCA Labs at Srikakulam and Pithampur facilities respectively.

However, the regulator has not asked Indian companies to recall drugs from the market.

Sun Pharma shed 1%. Cipla lost 0.7% shrugging off the news that South Africa's National Health Department awarded a 10 billion rand ($860 million) tender to four pharmaceutical firms to supply AIDS treatment drugs.

IT shares witnessed pressure in today’s trade. Infosys, Wipro and TCS were down between 0.8-1.5%. NTPC lost 2% .

NTPC, the state-owned thermal power generation giant, might lose the chance to build its first ultra mega power project (UMPPs), as the government is likely to scrap the bidding process for the Cheyyur UMPP in Tamil Nadu.

Oil and gas shares ended weak. ONGC declined over 2%, GAIL lost over 3% and RIL slipped 0.7% on the back of declining crude oil prices.

HDFC twins, BHEL, Bajaj Auto and M&M were some of the notable names in red among others on the 30-share Sensex and lost between 1.5-3%.

Among other shares, real estate developer Sobha ended the session with marginal gains after a foreign investor Platinum Investment Management Limited acquired over 300,000 shares of the company through open market.

Among other stocks, Oberoi realty, Unitech, HDIL and India Bulls real estate were up between 1-4%.

Shares of companies engaged in insurance business moved higher by up to 4% after the Union Cabinet clears the Insurance Laws Amendment Bill.

Max India, Reliance Capital, Exide Industries Aditya Birla Nuvo and Bajaj Finserve were up 1-4% on the BSE.

Shares of UltraTech Cement were trading higher by 3% at Rs 2,616 on the National Stock Exchange (NSE) after the company said its board has approved a proposal for the acquisition of cement units of Jaiprakash Associates Limited (JAL) located in Madhya Pradesh.

Global Markets:

Asian stocks gained and the dollar stood tall on Wednesday thanks to surprisingly robust U.S. economic growth, helping investors head into the Christmas holidays in a more relaxed mood after the global market turbulence of the past two weeks.

Japan’s Nikkei gained over 1% while Hang Seng ended flat with a positive bias.

China's Shanghai Composite Index lost 2.5%, to 2,957.43, dropping below 3,000 - a key support level - for the first time since Dec. 17, and raising concerns of further falls.

European stocks gained on Wednesday ahead of the Christmas break, for the seventh straight session tracking a rally on Wall Street bolstered by unexpectedly strong US economic growth data.

In the broader market, BSE midcap index ended the session with marginal higher with a gain of around 0.2% while BSE Smallcap index ended flat.

Market breadth ended weak on the BSE with 1,487 shares declining and 1,340 shares advancing.