Markets end higher ahead of June F&O expiry

Benchmark share indices ended marginally higher ahead of June F&O expiry, amid range bound trade on Wednesday, led by private banks, metals and software shares.

The 30-share Sensex ended at 16,968 up 61 points or 0.4% after trading in a 100-point range and the 50-share Nifty ended at 5,142 up by 21 points or 0.4% after trading in a 31-point range. 

Meanwhile, the rupee is range bound, trading at 57.17/1850 vs 57.01/02 previous close and not far off the record low of 57.32 hit on Friday.

Trader says month-end oil demand keeps USD/INR supported, tips 56.90-57.25 range for session. Dealers cite no talk of RBI intervention, after likely dollar sales in each of the four previous sessions.

On the global front, Asian markets ended positive with Nikkei, Strait Times, Hang Seng and Taiwan gaining by almost 1% each.

European shares edged up on Wednesday but the euro was flat, with many investors out of the markets after Germany reiterated its staunch opposition to common bonds to share the euro zone's debt burden ahead of a European crisis summit.

The dollar eased from earlier highs and safe-haven German bonds were steady, while riskier assets like commodities eased, with all markets reluctant to advance in either direction before the June 28-29 summit in Brussels.

Back home, on the sectoral front, BSE Metal index surged by almost 2% followed by counters like Power, IT, Healthcare, FMCG, PSU, Banks, Realty and Capital Goods, all gaining between 0.1-1%. However, BSE Auto, Consumer Durable and Oil & Gas indices dipped between 0.1-1%.

From the Power space, Tata Power and NTPC gained between 1-2%. Power generation companies are trading higher on the bourses after the Delhi Electricity Regulatory Commission (DERC) announced a 26% increase in power tariff for all domestic consumers with effect from July 1.

IT export majors like Infosys, TCS and Wipro gained by almost 1% each on the back of encouraging home prices data in the US, from which they earn most of their revenues.

Among Metal shares, Tata Steel was the top Sensex gainer, up nearly 3%. Sterlite, Hindalco and Coal India gained between 1-2%.

Infra share like BHEL ended higher by nearly 1%. Infrastructure shares gained on optimism the government will push for increased investments in projects, especially after Prime Minister Manmohan Singh is now the acting finance minister after Pranab Mukherjee stepped down on Tuesday.

From the banking space, ICICI Bank and HDFC Bank gained by nearly 1% each. However, SBI closed marginally lower. Morgan Stanley has maintained its "underperform" rating on State Bank of India, with a target price of Rs 1,425, after a meeting with the lender's management.

The investment bank says "asset quality pressures will intensify" in the fiscal year ending in March 2013, while the "flow of bad loans will be lumpy."

From the Auto space, Tata Motors was the top Sensex loser, down over 2%. M&M ended marginally lower. Auto share winessed profit taking following a recommendation by a top government panel to make changes in the diesel subsidy system.

Other notable losers included Wipro, Bharti Airtel, RIL, L&T, Cipla and JSPL.

Smart Movers

United Phosphorus ended higher by 4%, extending its yesterday’s around 4% rally after the agrochemicals company said that it has bought 745,558 shares between June 22 and June 25 through open market purchase under buyback offer.

Gateway Distriparks ended higher by 3% at Rs 131 after Morgan Stanley Asia (Singapore) PTE bought around 1% stake of logistics firm through bulk deal on the Bombay Stock Exchange.

Manappuram Finance surged almost 10% to Rs 33 extending its past three days gain, on back of over two-fold jump in trading volumes.

Strides Arcolab rallied 3% after the pharmaceutical firm said that it has redeemed the outstanding $80 million foreign currency convertible bonds (FCCBs) on due date through internal accruals.

Kingfisher Airlines tanked 8% to Rs 12 on reports that lessors have taken back about 32 aircraft in the past few weeks due to non-payments of rental by the cash-strapped airline.

BSE Midcap and Smallcap indices closed marginally higher, both gaining by nearly 0.4% each.

The market breadth in BSE ended positive with 1,466 shares advancing and 1,304 shares declining.