Volatility mars Indian indices

Fri, 6 Jul Closing

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Indian equity markets had a volatile outing today. The indices began the day's proceedings on a weak note. Thereafter, they languished in the red throughout the morning session. However, buying activity picked up pace post noon pushing the indices towards the dotted line although they could not break above it. The final trading hour saw the indices close marginally into the negative. While the Sensex today closed lower by around 18 points, the NSE-Nifty today closed lower by 10 points. The BSE Mid Cap and the BSE Small Cap were not spared either as they closed lower by 1% and 0.2% respectively. Losses were largely seen in metal and consumer durables stocks, while banking and FMCG stocks managed to buck the trend.

As regards global markets, Asian indices closed mixed today while European indices have opened in the red. The rupee was trading at Rs 55.48 to the dollar at the time of writing.

Auto stocks closed mixed today. While Mahindra & Mahindra (M&M) and Tata Motors found favour, Bajaj Auto and Hero Motocorp closed in the red. As per a leading business daily, M&M is looking to bolster its presence in the African country of Kenya. With the aim of boosting exports, the company has made a slew of product launches in the market. These include XUV500 SUV, the Scorpio SUV and Pick Up range, the Genio Pick-Up and the Maxximo mini-truck. Further, the company appointed Simba Corporation as the sole dealer for its vehicles in Kenya and the dealership will trade under Xylon Motors. It must be noted that FY12 was a challenging year for most auto companies. Sales in the domestic market were hampered by slowdown in economy, high interest rates and fuel prices all of which dampened demand. However, many companies saw a healthy growth in exports providing a cushion to overall sales. M&M was no exception as its automotive exports grew by around 70% in FY12.

Most engineering stocks closed in the red today and the key losers were Larsen & Toubro (L&T), Voltas and Thermax. BHEL, however, closed in the positive. As per a leading business daily, Bharat Heavy Electricals Ltd (BHEL) has commissioned the third 250 MW advanced-class gas turbine Pragati-III project at Bawana in New Delhi. Thus, 1,000 megawatts is now available for feeding power to the grid from this station. With this, BHEL has commissioned 2,250 MW in the first quarter of the current fiscal. It must be noted that BHEL's current order book stands at Rs 1.35 trillion. The company registered an order inflow of Rs 220.9 bn in FY12. This was significantly lower than the order inflow of Rs 605 bn in the previous fiscal. Difficulties in getting coal linkages and the existing environmental issues impacted the order inflow for the year. Going forward, the management expects order inflow of 14000-15000 MW in FY13. However, it may be noted that most of these orders are basically carried forward from the previous year.