Lacklustre trades continue

Autos shine while IT, banks decline

Markets continued to trade in the red this morning as traders took to profit booking after Thursday's big rally. The Sensex is down 63 points at 18,996. Nifty is down 29 points at 5,758.

"I continue to remain bullish on the markets with euphoria running very high thanks to the various reforms being carried out by the Government and the hopes of some more in the coming days. For the near future, I have set a target for Sensex between19,800-20,500 and the Nifty touching 5980-6100 post which I foresee a major correction towards the result season," said A K Prabhakar, Senior Vice President Equity Research, Anand Rathi.

The Asian markets are also trading higher as investor risk aversion eased after the European Central Bank said it was ready to buy bonds of troubled euro zone countries, while markets awaited a key US jobs report. Nikkei, NZSE, Hang Seng and Straits Times traded marginally in the green.

The rupee today gained 33 paise to nearly six-month high of 51.41 against the dollar in early trade on strong capital inflows and a firming trend in the equity market after the government unleashed second wave of reforms yesterday.

Back home, In a slew of big decisions, the Cabinet cleared two important financial sector reform Bills, aimed at increasing FDI in the insurance sector to 49% from the current 26% and opening of the pension sector to FDI in line with the insurance sector. It also approved the Companies Bill, 2011, making spending on corporate social responsibility a mandatory provision for companies above a threshold.

Broader markets are trading in the red as well, down around half a per cent each. Among the sectoral indices, BSE auto index has jumped 1.2% at 10,565 on monthly sales data. FMCG, oil & gas and metal shares are marginally in green. However, weakness can be seen in IT stocks owing to the rupee rally. BSE IT index is down 1.2% at 5,934.

Tata Motors, Mahindra & Mahindra are the top gainers, followed by HUL, Coal India, Hindalco and ITC. Market heavyweight Reliance is flat at Rs 852.

HDFC is the biggest loser - down 5% at Rs 750 on back of multiple block deals on the NSE and BSE. According to reports, global private equity major, Carlyle Group, offloaded its 3.71% residual stake in the housing finance major for about $850 million (about Rs 4,500 crore). Wipro, TCS, BHEL and Bharti Airtel are also showing selling pressure.

Sun Pharma has slipped 0.8% at Rs 693 after the board approved a proposal to raise up to Rs 8,000 crore through domestic or international offerings.