Broader markets rule; bechmarks lacklustre

Key benchmark scrapped most of the gains in closing deals, amid rangebound trade on Monday, supported by buying in rate sensitive realty, capital goods and banking stocks.

Last week, the Reserve Bank of India kept key policy rates citing the need to push sagging growth while being equally wary of the inflation, sparking off a relief rally on the bourses.

Broader markets outperformed the bechmarks today after market regulator Securities and Exchange Board of India announced rationalisation of the rules on trading of thinly-traded stocks.

BSE Small-Cap and Mid-Cap indices were up more than 1% each, with both these indices outperforming the Sensex today.

The 30-share Sensex ended at 21,101.03, up 21 points higher from its previous close and the borader 50-unit Nifty gained 10 points at 6,284.50.

The market sentiment is also boosted by data showing that foreign funds remained buyers of Indian stocks on Friday.

Foreign institutional investors (FIIs) bought shares worth a net Rs 990.19 crore on Friday, 20 December 2013, as per provisional data from the stock exchanges.

The direction of foreign institutional inflows and the rupee against the dollar would be deciding the stock market trend in the truncated trading week ahead.

The partially convertible rupee is trading at 61.91-a-dollar at the interbank exchange in afternoon deals.

Asian markets finished higher today with shares in Hong Kong leading the region. The Hang Seng is up 0.48% while China's Shanghai Composite is up 0.24%. Japanese markets were closed today on account of Emperor's Birthday.

Asian stocks inched higher on Monday encouraged by record highs on Wall Street, though anxiety over a credit squeeze in China capped the gains.

China's central bank said it added $50 billion in three days to the interbank market to allay fears of a credit crunch cash crunch on Friday.

Fast pace of credit growth in the country has its government worried that rising debt levels are creating asset bubbles.

The People's Bank of China (PBOC) has injected more than 300 billion yuan into the interbank market in response to rising rates, but hinted that banks have work to do if they want to avoid a cash crunch.

Back home, the rupee is trading at 61.92 versus its close of 62.04/05 on Friday, tracking slight gains in most Asian sharemarkets.

On the sectoral front, BSE Realty was the top gainer, up over 3% followed by metals, Capital Goods, power, consumer durables, Bankex, FMCG, Healthcare and Auto indices surged between 0.2-1.3%. IT, TECk were the sole laggards on the BSE sectoral indices.
 
ITC ended 1.17% higher, ICICI Bank was up 0.8%, ONGC up 1.4%, L&T up 0.6% and Hindalco 3.6% higher, were the top Sensex gainers today.

L&T gained after L&T Infrastructure Development Projects (L&T IDPL), a subsidiary of the company has submitted an application to the Foreign Investment Promotion Board (FIPB) seeking approval in relation to a proposed foreign direct investment in L&T IDPL.

Auto stocks were in focus after PSU OMCs hiked the petrol price on Friday by 41 paise a litre following the government's decision to raise commission paid to petrol pump dealers and firming global oil rates. Simultaneously, diesel rates were increased by 10 paise per litre due to a hike in dealers' commission. Maruti Suzuki ended 0.33% lower at Rs 1,804.05, M&M was down 0.44% at Rs 965.

On the losing side, Infosys, HDFC, TCS, HDFC and HUL declined between 0.1-1%.

Infosys has dropped by 0.9% after the company announced after market hours on Friday the changes to the board of directors of the company. V. Balakrishnan has conveyed his intention to resign as a member of the board and from the services of the company.

The board places on record deep sense of appreciation of the services rendered by V. Balakrishnan during his tenure as the member of the board, Chief Financial Officer of the company and then as the Member of the Board in-charge of Infosys BPO, Lodestone, Finacle, India Business Unit and Global Immigration.

Among other shares, shares in United Spirits Ltd fell as much as 6% on Monday after a court ordered the annulment of the sale of the Indian spirits maker to British group Diageo.

The market breadth in BSE ended firm with 1,595 shares advancing and 917 shares declining.