Markets end flat amid volatility

Markets ended flat on Monday, amid a volatile trading session, as gains in FMCG majors and ICICI Bank helped offset losses in Infosys and L&T.

The Sensex ended higher by 38 points to close at 18,713 and the 50-share Nifty advanced 11 points to close at 5,687. For the most part of the day markets were stuck in a tight range and the Sensex traded in a range of 130 points.

The Asian markets also ended on a flat note on growth concerns ahead of the third-quarter corporate earnings season, lifting the safe-haven dollar which in turn undermined commodities. The Hang Seng advanced 12 points to close at 21,148, Nikkei jumped 44 points to 8,577 and the Straits Times ended marginally higher at 3,043. While, Shanghai Composite clsed lower by 6 points at 2,098,

The European markets were trading higher on hopes that struggling Spain will request a bailout which would lower its borrowing costs. The CAC 40, DAX and FTSE were up 0.5-1.2% each.

Back home, inflation rose 7.81% in September from a year earlier as prices of potato, pulses, wheat and sugar soared. The impact of increase in diesel prices is partly reflected in last month's figures. High speed diesel inflation soared 8.94% after the government increased diesel prices by Rs 5 on September 13.

The data comes ahead of Reserve Bank of India's monetary policy on October 30. The central bank is under pressure to lower interest rates as its anti-inflationary stance has hurt growth. But a further rise in inflation would make RBI's job difficult.

Hindalco was the was the top gainer among the Sensex stocks. It advanced nearly 2% to Rs 120. BHEL, Cipla, Bharti Airtel, Tata Power, ONGC, ITC, Jindal Steel, ICICI Bank, Dr Reddy's Labs, State Bank of India, Hindustan Unilever and index heavyweight Reliance Industries also closed higher by 0.5-1.6%

each.

On the other hand, Maruti Suzuki was the top Sensex loser, down nearly 3% to close at Rs 1,335. Infosys, Sterlite Industries, Larsen & Toubro, Coal India, Hero MotoCorp, TCS, Tata Motors and NTPC were also among the laggards.

Most of the sectoral indices ended on a positive note. The BSE oil & gas index was the top gainer, led by buying witnessed by index heavyweight Reliance Industries. The index advanced 0.5% to end at 8,590. BSE banking index reversed the early losses to close higher by 0.5% at 13,141 levels. FMCG, realty, power, healthcare and PSU indices also closed higher by 0.1-0.4% each. While, consumer durables, IT, yeck, auto, capital goods and metal indices closed weaker by 0.1-1% each.

Among the individual stocks, ITC and Hindustan Unilever (HUL) touched their respective lifetime highs on expectation of strong net profit growth for July-September 2012 quarter (Q2).

Shares of cement manufacturers, mainly mid-and-small sized companies, rallied on the bourses after Heidelberg Cement India reported a strong net profit growth for the quarter ended September 2012 (Q2FY13).

D B Realty was locked in upper circuit of 5% at Rs 98.75 for a second consecutive day after ace investor Rakesh Jhunjhunwala's firm acquired more than one million shares of the Mumbai-based real estate firm through open market transaction.

Electrosteel Castings ended higher by 4% at Rs 23.35 extending its past two day's 12% rally after reported a robust earnings growth for the quarter ended September 2012.

The broader markets also ended on a flat note. The BSE mid-cap index closed unchanged at 6,676 and the small-cap index advanced 0.4% to close at 7,141.

The overall breadth was neutral as 1,456 stocks advanced while 1,382 stocks declined.