Tight range: Sensex, Nifty end with gains

iifl9th July, 2013 : Comments by Amar Ambani, Head of Research, India Infoline

Tight range: Sensex, Nifty end with gains

It was a choppy Tuesday session with the benchmark indices trading in a narrow range. The Nifty traded in a tight band of 30 points while the same for the Sensex was 100 points.

The market opened with a positive gap but more or less languished for most part of the day. The Reserve Bank of India banned banks from proprietary trading in domestic currency futures and options late on Monday. Meanwhile, the Securities and Exchange Board of India doubled the margin requirement on the domestic dollar-rupee forward trade.

This was enough to stem the rupee’s weakness from its all-time record low of 61.20 hit on Monday and turnaround sentiment on D-Street. The rupee appreciated to 59.84 per dollar in early trade today but concerns of an early rollback in Fed stimulus programme saw the Indian unit weaken back to 60.35 levels.

Commenting on the same, Amar Ambani, Head of Research at IIFL, sees the rupee depreciating to 60.80 levels against the greenback with support of 59.90. “A breach of 59.90 levels, may see the rupee appreciating to 59.20 per dollar in the short-term.”

The Sensex finally ended the day at 19,439.48, up 114.71 points, while the Nifty shut shop up 47.45 points at 5,859 over Monday’s close.

Buying in select consumer durables, power, realty and banking stocks aided the rally. Also, a positive Asian and European market helped sentiment.

The major gainers in trade include PowerGrid up 4.32%, Sun Pharmaceutical (3.55%), Kotak Mahindra Bank (3.15%), Reliance Infrastructure (2.87%), Bank of Baroda (2.46%) and BHEL (2%). The losers pack included Jindal Steel down 2.1%, M&M (1.01%), Hindustan Unilever (0.78%), and Bharti (-0.66%)

The advance-decline ratio marginally favoured the bears. On the Bombay Stock Exchange, 1,312 stocks declined against 1,008 advances, while 130 stocks remained unchanged.

Volatility, as measured by India VIX, closed flat at 19.32 . It hit a day’s high of 19.53 and low of 18.41.