Markets rangebound ahead of CPI & IIP numbers

Benchmark indices are trading in a tight range with a negative bias weighed down by oil and metal shares amid weak global cues. However, fresh buying in FMCG shares have limit losses.

At 12.20 PM, the 30-share Sensex is down 69 points at 27,389 and the 50-share Nifty has shed 13 points to trade at 8,271.

On the inflation front, the consumer price index (CPI) moderated to 4.4 per cent in November. But this was on the back of a high base of 11.2 per cent in the same month last year, implying the decline should be viewed with caution. Reports suggest that retail inflation is likely to be on the higher side. The government will detail November IIP and December CPI data later today.

Rupee:

The Indian rupee on Monday strengthened and is trading at 62.18 against the dollar for the fourth consecutive session ahead of the Index of Industrial production (IIP) and Consumer Price Index (CPI) data due later in the day.

Meanwhile, foreign institutional investors were net sellers in Indian equities to the tune of Rs 298 crore on Friday, as per provisional stock exchange data.

Key Stocks:

On the sectoral front, BSE Metal index is the top loser down 1.7% followed by BSE Oil & Gas index down 1.6%. On the other hand, BSE FMCG index is the top gainer up 1.3%. 

Coal India is the top Sensex loser down nearly 5%. Media reports suggest that the government is planning to reduce its stake in Coal India by 10%.

Oil shares are under pressure on further decline in crude prices. RIL has lost 2% while ONGC and GAIL have declined around 1.5% and 1% each. Reliance Industries Chairman Mukesh Ambani announced Rs 100,000 crore investments across businesses in the next 12-18 months and said India was on the path to become the world's fastest growing economy.

Bharti Airtel has shed 2%. Meadi reports suggest that the Supreme Court today refused to grant a stay on proposed auction of spectrum allocated to Bharti Airtel.

Selling pressure was seen in the auto and metal stocks. Hero Motocorp, Bajaj Auto, M&M, Tata Motors, Hindalco, Tata Steel, Sesa Sterlite have lost between 1-2%.

On the flip side, FMCG shares are among the top gainers on hopes that lower commodity prices would boost margins in the third quarter. HUL has gained over 3.5% extending its past five-day’s gain, recording its sharpest rally in 20-months and is nearing Rs 900 levels on sustained buying after a couple of foreign brokerages upgraded the stock. ITC is up 0.3%.

Infosys extended gains and has surged 1.2% after the IT major last week announced third quarter earnings which beat street estimates.

Other Sensex gainers include Axis Bank, SBI, Sun Pharma and Dr Reddy's Labs among others and are up between 0.4-1.2%.

In the broader market, the BSE Mid-cap and Small-cap indices are outperforming the large counterparts and are up 0.4-0.7%.

Market breadth is healthy with 1,512 gainers and1,197 losers on the BSE.

Asian Markets:

Shares in China extended losses and the benchmark Shanghai Composite was down 2.2% while Hang Seng was up 0.2% and Straits Times was trading flat. Meanwhile, financial markets in Japan were closed on account of Coming of Age (Adults') holiday.