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Blue-chips drag Sensex, Nifty; mid, small caps sprint

17:06

Blue-chips stocks drifted sideways Tuesday but most midcap and small caps continued their winning streaked and outperformed their large cap counterparts by a wide margin.

It was a choppy session that saw both Sensex and Nifty close flat with a negative bias after hitting fresh intra-day record levels in early trades.

While banking and engineering stocks such as HDFC Bank, Larsen & Toubro cushioned the Nifty, defensive tech and pharma stocks such as TCS, Infosys and Sun Pharma dragged the benchmark back to where it closed yesterday.

The BSE Sensex closed at 28,163 down 0.05 percent and the Nifty closed 0.06 percent lower at 8,426 levels.

Blue-chips stocks appeared lazy to move on Tuesday but mid-caps and small-cap stocks’ agility led the BSE mid-cap and small-cap indices to beat Sensex’s near-flat ending with a 0.2-0.9 percent sprint.

Brokerage Nomura told CNBC TV18 that the RBI will not cut policy rates in the 2nd December policy and that they are getting incrementally bullish on equities with an August 2015 Sensex target of 30310. Bank stocks have rallied lately on hopes of a rate cut as latest inflation figures came below RBI’s intermediate target of keep inflation below 6 percent. 

In trade today, capital goods, banks, autos and telecomm stocks were the gainers while defensive IT, pharma along with oil & gas and consumer non-durables were the losers.

In important macro news today, the government may announce measures to further curb gold imports later today. The move came after Mondays trade data showed gold imports surged 280 percent to USD 4.17 billion from USD 1.09 billion Y-o-Y. Jewellery and gold stocks bore the brunt of this Titan, Gitanjali Gems, PC Jeweller and Tara Jewels ended 1-2 percent lower.

Telecom stocks were in demand led by bellwether Bharti Airtel, which was up 1.6 percent. Logistics shares continued their recent rally, with Container Corp and Snowman Logistics climbing 5 percent each while Patel Integrated was up 10 percent.

Stocks of infrastructure and insurance were on the traders’ radar after Finance  Minister Arun Jaitely’s said yesterday that he expects the Insurance Amendment bill to be passed in the fortcoming winter session of parliment and in discussion with the opposition to make changes in the Land Acquisition act. Stringent land acquisition laws are major irritants for industry growth, say experts. 

A potential discussion on subsidies to sugar exports in PMO’s proposed meet with sugar exporters tomorrow brought sweet gains for  Balrampur Chini, Shree Renuka ,  Bajaj Hindusthan and  Sakthi Sugars were up 4-10 percent each on Tuesday.
 
Sesa Sterlite stock, which fared among top three Nifty gainers today, gained on back of reports that the mining major is planning to expand its copper smelter unit in Tuticorin. The stock jumped 3.7 percent to close at Rs 246.95 on NSE.

Globally, stocks in Europe rose on reports that the European Central Bank might take steps to fight off deflation. Japanese market led the gains in Asian after Prime Minister Shinzo Abe declared to put off a sales-tax hike and called for a snap election after latest GDP figures showed the Japan entered recession.

Foreign portfolio investors (FPIs) bought local shares worth Rs 656.37 crore yesterday, 17 November 2014, as per provisional data.

The rupee hit a one month low today before recovering marginally as private oil firms bought dollars while a broadly stronger dollar also hurt sentiment of the local currency.

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