Markets slip ahead of November CPI

Markets ended lower on Wednesday, amid a volatile trading session, as investors turned cautious ahead of the consumer price inflation data for November due for release tomorrow. Further, markets shrugged off the November trade data.

The 30-share Sensex ended down 84 points at 21,171 and the 50-share Nifty closed 25 points lower at 6,308.

Snapping a double digit growth trend  for the previous four months, merchandise exports rose just 5.86% at $24.61 billion in November year-on-year despite rupee depreciation.

Exports were dragged down by slower growth in refinery, pharmaceutical and gems & jewellery products.

Trade deficit came  down by 46.45% at $9.21 billion in November against $17.20 billion a year ago.

Wholesale price inflation rose to 7% in October from 6.46%  in the previous month, where as the rate of price rise in food articles (part  of overall inflation) remained in double digits for the fifth month in a row in October. However, food inflation moderated a bit to 18.19% in October from 18.40% in September.

The rupee snapped its five-day rising streak against the US dollar and fell by 28 paise at 61.32 per dollar in early trade today at the Interbank Foreign Exchange market on fresh dollar demand from importers. The rupee had closed at Rs 61.04 to the dollar on Tuesday.

Besides an increased demand for the dollar from importers, a mixed trend in the American currency against other overseas currencies and weakenss in the domestic equity market also put pressure on the rupee, forex dealers said.

Asian shares ended lower as investors booked profits amid uncertainty over US Fed's bond tapering programme. Shares in Japan were down amid a stronger yen, while profit taking in bank shares pushed Shanghai Composite 1.5% down and Hang Seng ended 1.7% down.

The Nikkei ended down 0.6% while Straits Times closed 0.7% lower.

European shares staged a recovery after a flat opening. CAC, DAX and FTSE were up 0.1-0.6% each.

The BSE Capital Goods and Auto indices were among the top losers among the sectoral indices on the BSE down over 1% each. Other losers include, Metal, Oil and Gas indices.

Tata Motors, L&T, TCS, SBI, ONGC, Bharti Airtel and Reliance Ind were among the top losers contributing the most to the Sensex losses.

FMCG major ITC ended up 1% at Rs 321. NTPC rebounded today and ended up 2.4% at Rs 139 after the sharp 11% drop yesterday.

The Central Electricity Regulatory Commission released draft regulations that will decide the multi-year power tariffs for 2014-2019.

Other Sensex gainers include HDFC which ended up 1.6% and HDFC Bank ended with marginal gains.

Among other shares, Sabero Organic Gujarat has rallied nearly 4% to end at Rs 150, extending its past seven days rally, after the Gujarat Pollution Control Board (GPCB) revoked its closure order of the company’s Sarigam unit for a period of 3 months.

United Breweries ended higher by 2% at Rs 791 after the Dutch liquor giant Heineken hiked its stake in the company by over one percentage point through an open market transaction.

Bharti Infratel gained nearly 4% to end at Rs 185 after Bharti Airtel and Reliance Jio Infocomm announced a comprehensive telecom infrastructure sharing arrangement under which they will share infrastructure created by both parties.

Reliance Jio Infocomm is a subsidiary of Reliance Industries Limited (RIL).

Elder Pharmaceutical has surged 11.4% to end at Rs 318 on back of heavy volumes on the bourses.

The company said it has been exploring various options to reduce its debt.

The broader market ended mixed, the BSE Mid-cap index ended down 0.1% and the Small-cap index closed 0.1% higher.

Market breadth remained weak with 1,356 losers and 1,134 gainers on the BSE.