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Sensex, Nifty erase half of early gains; Sun Pharma up 6%


The News International Team

12:20pm Coal Auction: The government is ready to get round-two of the coal block auction process underway. Auction for 14 coal blocks in the schedule 3 began today. Blocks which are about to come into production are part of second phase of coal auction. Today, 3 coal blocks are up for auction.

Bids are open for Moitra block at Rs 1,004 per tonne and for Brinda & Sasai at Rs 1,802 per tonne in forward bidding. Opening bids price for Jitpur coal block (reserved for power sector) is at Rs 120 per tonne.

12:00pm Market Check

The market erased more than half of its early gains on the back of profit booking in technology, capital goods and select banks stocks. The Sensex climbed 174.06 points to 29767.79, which had rallied 400 points in early part of the session to hit 30000-mark. The Nifty rose 40.95 points to 9037.20.

The broader markets too came off day’s low with the advance:decline ratio of 1:1.

Sun Pharma topped the buying list on Sensex, up 6 percent. Even its subsidiary Sun Pharma Advanced Research Company gained 6 percent on getting US FDA nod for Elepsia XR extended release tablets, an anti-epileptic drug. SPARC says product will be manufactured by Sun Pharma at Halol unit.

Private sector lender ICICI Bank and housing finance company HDFC gained 2 percent. HDFC Bank rose 0.7 percent whereas SBI and Axis Bank lost ground despite RBI surprised the street with a second out-of-the policy rate cut, cutting repo rate cut by 25 basis points to 7.5 percent. The RBI kept cash reserve ratio unchanged at 4 percent.

The RBI Governor Raghuram Rajan says disinflation is evolving at a faster pace than envisaged and further monetary action will be conditioned by incoming data.

Industry and experts welcomed the rate cut. Chief Economic Advisor, Arvind Subramanian believes today’s rate cut is what the economy needs, saying the Budget is conducive to non-inflationary growth. MoS Finance, Jayant Sinha says the rate cut will provide a near-term boost to economy.

Tata Motors climbed 1.5 percent as apart from the RBI rate cut, strong JLR sales in the US boosted the stock. Jaguar Land Rover sales surged 14 percent in February bringing the total sales to rise by 11 percent this year so far.

Meanwhile, the bidding for spectrum airways began today and eight telecom companies including Bharti Airtel, Vodafone, Idea Cellular, Reliance Communications and Reliance Jio are expected to bid aggressively. The government is targeting a revenue of Rs 80,000 crore from the auction. Bharti Airtel and Reliance Communications surged 2 percent each while rival Idea Cellular gained 4 percent.

However, Reliance Industries, TCS, Infosys, Larsen & Toubro, Wipro and M&M fell 0.2-0.8 percent.

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