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Sensex volatile, Nifty still below 8550; MM slips 3%

13:00

The News International Team

01:40pm OMCs under pressure

Government sources told CNBC-TV18 that excise tax on petrol increased by Rs 2.25 per litre and diesel by Re 1 a litre.

BPCL, HPCL and IOC fell 3 percent each.

01:25pm Market Expert

The Nifty is likely to hit 9000 by Budget in late February, feels Andrew Holland of Ambit Investment Advisors. In an interview with CNBC-TV18, he says the Sensex is likely to hit 45,000 in the next three years.

Holland is not bullish on PSU banks from a long term perspective, though he has become constructive on the banking space near term. Holland sees the RBI cutting interest rates in the March quarter.

He expects crude prices to decline further as he feels it is more of a demand issue than a supply problem. Holland feels the best way to play the oil story would be to bet on companies building oil & gas pipelines across the country.

He expects a global sell-off in January on economic growth concerns. Should global markets crack, India will not be immune to it, cautions Holland. But he says any steep decline will be a good buying opportunity.

01:00pm Market Check

The market turned choppy after Reserve Bank of India (RBI) kept rates unchanged in its fifth bimonthly monetary policy review. The Nifty and the Bank Nifty recovered from the day’s low after RBI’s dovish stance spurred hope of a rate cut as early as March next year. The BSE Midcap outperformed, up half a percent.

The Sensex declined 59.77 points to 28499.85 and the Nifty fell 17.75 points to 8538.15. About 1236 shares have advanced, 1403 shares declined, and 116 shares are unchanged on the Bombay Stock Exchange.

The Reserve Bank of India cut the March-end CPI inflation target to 6 percent from 8 percent earlier. The governor Raghuram Rajan says change in monetary policy stance now would be premature, adding RBI may change stance in early 2015 if inflation eases.

The central bank further added that it would want to see pace of disinflationary process set in, before taking a decision and that moderate inflation is a must to sustain healthy growth. The governor says that the government is comfortable with median inflation aim of 4 percent.

Bajaj Auto fell over 1 percent after reporting weak November sales numbers that came in lower by 0.5 percent primarily owing to the slump in domestic sales which are down 19 percnet year-on-year. Mahindra & Mahindra slipped nearly 3 percent while Tata Motors, Maruti Suzuki and Hero Motocorp lost 0.7-1.3 percent.

Infosys declined 1.7 percent as the stock price adjusted for bonus issue in the ratio of one share for every one share held. Housing finance company HDFC slipped over a percent.

However, shares of L&T, ICICI Bank, Reliance Industries, Bharti Airtel, ONGC, Sesa Sterlite, Sun Pharma, Hindalco and Tata Steel gained 0.5-1.5 percent.

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