Global peers, IT stocks drag markets

The markets, today, ended near the day's low on weakness witnessed in auto and IT stocks. Cues from the European peers also dampened investor sentiments, taking the Sensex to a low of 18,449 - down 93 points from the previous close. The index finally ended down 55 points at 18,507.

Mid-day today, the European bourses opened in red, with the CAC down 1.2%, DAX and FTSE too down around 1% each. Also, in Asia, markets ended in the negative terrain on worries that the US government may not be able to settle on an agreement to cut the fiscal deficit. Hang Seng slipped 0.3% to 21,804. New Zealand and Seoul Composite saw cuts of 0.6% each.

Meanwhile, among other news, monsoon rains were said to be above average in June, but at the same time were 3% below average after slowing in the first week of July.

Among stocks, FMCG gaint Hindustan Unilever added 1% to Rs 332. Tata Global, Nestle India and Colgate Palmolive advanced in trades as well. The FMCG index touched a record high of 4,071, and settled at 4,049 - up 0.25 per cent.

IT stocks fell on slowdown concerns airising from the US and the European debt worries. Wipro shed 0.5% on reports that the company's Rs 1,182 crore contract with Employees' State Insurance Corporation (ESIC) for IT services is facing technical problems with the government health insurer's internet portals. TCS and Infosys, which came out with quarterly numbers last week, were down 1-2% each. TCS had gained 2% on Friday after announcing the Q1 results. Infosys, however, has not been able to recover post results.

"Of the top three companies, only TCS seems to holding on to its price - and even that is moving sideways since last six months. IT stocks can be held on to by long term investors, but short term do not offer much hope," said Hormuz Maloo, Technical Analyst, Geojit BNP Paribas Securities.

Fears of a high interest rate, which would further reduce demand for credit, dragged bank stocks lower. BSE bankex was unchanged at 12,845. Indusind Bank led the losers list in the sector, followed by ICICI Bank, Axis Bank, Union Bank and Bank of Baroda. PSU banking behomoth, SBI, ended flat at Rs 2,472.

Metal stocks, however, had a good trading day. After days of weakness, Hindalco today jumped 3% to Rs 182. JSW Steel, Sterlite, Hindustan Zinc and SAIL were also up in trades.

Airline stocks had a volatile day. The stock were up this morning despite state-owned oil marketing companies raising jet fuel or aviation turbine fuel prices by a marginal Rs 78 per kilolitre. The effect was seen later in the day, as the aviation stocks erased gains and ended 1-2% lower each.

Meanwhile, 45 stocks today touched their respective life-time highs in an otherwise lacklustre markets. Prominent among these were HDFC Bank, Nestle India, Cadila Healthcare, Petronet LNG,  Amara Raja Batteries, Indraprastha Gas and TTK Prestige.

Fertilizer shares also went up on hopes that the government is considering changes in the urea policy. Aries Agro, Dharamsi Morarji, Deepak Fertiliser, GNFC and Coromandel International edged up in trades.

Textiles stocks too logged smart gains on hopes that the trade deal between India and 27-nation European Union (EU) will benefit the exporters of textile and readymade garments makers. Among individual stocks, Gokaldas Exports, Vardhman Textiles, Sambandam Spinning, Suryalakshmi Cotton, Nahar Spinning, Indo Rama Synthetics and RSWM moved up smartly.

The market breadth was negative. Out of 3,012 stocks traded, 1,546 advanced while 1,322 declined today.