Markets end flat on caution ahead of Fed, RBI meet

Markets ended on a flat note after rising to over 1 per cent intra-day as investors preferred to say on the side-line ahead of key global and local events this week.

Risk appetite was fragile after country’s Wholesale Price Index (WPI) Inflation surged to over 6-month high raising fears that the central bank may keep interest rates high at the monetary policy meet this Friday.

Meanwhile, the Federal Reserve Open Market Commitee (FOMC) meet on September 17-18 will be key in terms of any tapering of $85 billion monthly bond purchases that led to significant inflows in the emerging markets especially India so far.

The 30-share Sensex rose 9.7 points to end at 19,742.47and the 50-share Nifty fell 10.05 points at 5,840.55 levels.

The Wholesale Price Index (WPI) based inflation rose to a six-month high of 6.1% in August against 5.79 in July, according to the data released by Ministry of Commerce and Industry today.

The broader markets ended negatively with mid-caps and small-caps shedding 0.5 per cent on the BSE.

The market breadth was almost flat. Out of 2,485 stocks traded, 1,244 stocks declined while 1,118 stocks advanced on the BSE.

RUPEE

The rupee rallied to a near one-month high on Monday, with stocks and bonds joining in, as hopes for a prolonged easy monetary policy in the US boosted emerging markets.

At 4PM, the partially convertible rupee was trading at 62.75 per dollar against the Friday’s close of 63.48 on the Interbank Foreign Exchange.

GLOBAL MARKETS

Asian stocks rose after Lawrence Summers withdrew from consideration as Federal Reserve chairman, paving the way for Janet Yellen, who investors say will favor a slower reduction of stimulus.

Singapore’s Straits Times gained 2% at 3,179, China’s Shanghai Composite index fell 0.2% at 2,231 while Hong Kong’s Hang Seng added 1.4% to 23,252 today. Japanese financial markets are shut today.

European shares also opened positive. CAC gained 1% to 4,158, Germany’s DAX gained 1.2% to 8,608 while UK’s FTSE was up 0.7% to 6,632.

STOCK MOVERS

Domestically, the key sectoral indices gainers were FMCG, auto, bankex while IT, realty, healthcare, oil & gas and metal indices dropped on the BSE.

The gainers included counters such as ICICI Bank and HDFC Bank gaining 3% and 2% respectively, Maruti Suzuki and Hero MotoCorp gained 2.5% each while Bharti Airtel was up 1.5% on the BSE.

The laggards were Sesa Goa fell 4%, Coal India dropped 2.6%, BHEL declined 2.3%, Cipla was down 2% on the BSE.

The key notable movers included counters such as Ranbaxy that lost 30% in trade today to touch its lowest level since June 25 at Rs 297 on reports that the US FDA (United States Food and Drug Administration) has issued an import alert on the company’s unit in Mohali.

HCL Technologies dipped over 5% to Rs 996.50 on reports that the information technology company will merge system integration and services business of HCL Infosystems with itself.

Strides Arcolab slipped by 4% at Rs 869 after the pharmaceutical company said has received a warning letter from the United States Food and Drug Administration (US FDA) for its sterile manufacturing facility at Bengaluru.