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Money Aug 2, 2012

Sensex snaps 4-day gain, SBI drops on slashing FD rates

By Firstbiz Staff

In a range-bound session of trade,the BSE Sensex fell on Thursday for the first session in five days as they, like other world markets, await cues from the European Central Bank meeting later today, after the US Federal Reserve refrained from offering fresh stimulus.

The Sensex closed at 17,224, down 33 points over the previous close. The broader NSE Nifty closed at 5,227, down 12 points over the previous close.

Dipan Mehta, member, BSE and NSE told CNBC-TV18 it is more likely that the market continues to trade in a particular range. "Although we may have some positive news flow from Europe, it is highly unlikely that the Nifty can sustain and trade significantly above 5,400 levels for an extended period of time," he said.

Further lenders also retreated after State Bank of India cut auto and home loan rates for new borrowers, sparking worries other lenders would follow suit and hit margins in the sector. State Bank of India fell 1 percent, while HDFC Bank lost 0.7 percent.

Reuters

The fall in the market was led by the Oil & Gas, Banking Metal, Realty and the Auto stocks. While the Consumer Durables, Power, Capital Goods and FMCG stocks bucked the negative trend.

Cairn India, Tata Motors, BPCL, Tata Power, Cipla, IDFC, Sterlite, JP Associates, Ambuja Cement were the notable losers on the Sensex and the Nifty today.

NTPC, BHEL, Axis Bank, SAIL, Jindal Steel, TCS, L&T, Bajaj Auto and Grasim were among the gainers on the Nifty.

Reports of PM relaxing the transfer policy for the government land for infrastructure projects, also eased some flexed nerves, eagerly awaiting action on policy reforms front. Much to surprise, improving from a five percent below average in the previous week, India's monsoon rains were only four percent below average in the week to August 1, as rainfall revived in soybean and rice growing areas of India.

Still, problems are far from over as two-months of the four-month long season are already over and if the monsoon does not continue to show improvement, inflationary pressures, especially food inflation, would most likely be stoked again.

Stocks in news
Shares of engines maker Cummins India surged 7.8% after the company's April-June net profit rose 2.3% to a better-than-expected Rs 181 crore.

Ashok Leyland showed a dead cat bounce, after the company registered 25% year-on-year growth in July sales at 9,785 units.

Meanwhile, country's second largest two-wheeler maker, Bajaj Auto, spiked over half a percent despite reporting 5% dip in July sales number.

NTPC advanced 3.8% to Rs 163.30 after 20 lakh shares of the company were transacted in a single block deal.

by Firstbiz Staff

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