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Indian Market May Open On Negative Note

(RTTNews) – The Indian market is likely to open flat with a negative bias on Wednesday, as the market may pause following recent gains. Mixed Asian cues also suggest that there could be considerable amount of profit taking.

However, further upside cannot be totally ruled out, given robust buying by foreign institutional investors and the recent break out of the major averages above key resistance levels.

FIIs bought shares worth Rs. 991.75 crore in cash market on Tuesday and net purchases by domestic financial institutions totaled Rs.206.25 crore, provisional data released by the BSE showed. On Monday, net purchases by FIIs totaled Rs.1,050 crore, according to market regulator SEBI.

Wall Street closed notably higher on Tuesday, extending its gains for a third straight session, as recent economic optimism generated some buying interest on a light day on the economic front. The Dow rose 0.59%, the Nasdaq Composite ended up 0.94% and the S&P 500 index advanced 0.88%.

The Indian ADRs closed sharply higher across the board. Sterlite Industries jumped 8.35%, ICICI Bank rallied 6.61% and Infosys, Wipro, Reddy’s Laboratories, Satyam Computer Services and HDFC Bank ended up more than 2% each.

Crude oil prices soared above $71 on Tuesday, boosted by a weaker dollar, as traders looked ahead to the Organization of Petroleum Exporting Countries meeting and the release of inventory data. After rising to as high as $71.95 in the session, light sweet crude for October delivery settled at $71.10 per barrel, up $3.08 and its best close this month. In Asian trading on Wednesday, crude oil is trading mostly unchanged.

The rupee extended gains for the fifth successive session on Tuesday, helped by the dollar’s weakness and rising stocks. The rupee closed near the day’s high at Rs.48.47/48 against the dollar, its best close since August 24 and 0.4% stronger from its previous close.

In corporate news, Jet Airways said that it has canceled 31 flights for Wednesday due to the ongoing agitation by its pilots protesting sacking of two of their colleagues.

State-run GAIL India may take a stake in the $1.95-billion gas pipeline project that China is building for ferrying natural gas found off the Myanmar coast, reports suggest.

ICICI Bank is close to selling one of its non-core businesses in the next couple of weeks, a television channel said on its website.

Mahindra Satyam has decided to reinstate the variable portion of the pay for close to 28,000 employees, which it had suspended last April .

Lanco Infratech plans to add 750-MW of power generation capacity at its Kondapalli facility in Andhra Pradesh, reports said.

On Tuesday, the Indian market pared its early gains and ended off the day’s high due to profit taking at higher levels. The BSE Sensex rose to a high of 16,232 before finishing at 16,124, up 107 points or 0.67% and the S&P CNX Nifty rose 22 points or 0.47% to 4,805. On the other hand, second-line stocks which outperformed large-caps in the past few days, ended on a subdued note.

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