Markets continue to trade soft

Auto, banking shares languish

Markets continued to trade on a soft note in afternoon deals, with visible weakness in auto and banking shares. The Sensex, recovered to a high of 16,392, and was now down 76 points at 16,363. Nifty was down 28 points at 4,962.

Asian markets were weak on worries that China may not get fresh stimulus spending even as Euro troubles remained in Spain. The Hang Seng dropped 1.8% to 18,709. Nikkei and Shanghai Composite slipped marginally in trades as well.

BSE auto index slipped 3.5% to 9,099. Consumer durables, bankex, realty and capital goods indices shed over 1% each. On the other hand, IT index has added 0.8% at 5,673.

Tata Motors slumped 10% to Rs 249 after reporting a 30 basis points decline in EBIDTA (earnings before interest, taxes, depreciation, and amortization) margin for Q4FY12 to 14.3%. The market expected a jump of over 100 basis points. One basis point is one hundredth of a percentage.

"We believe there is more down side to TATAMOTORS and support will seen only around 222-224 levels. Unwinding in Puts at lower strikes suggest loss of confidence among Bulls in this counter", said Shshank Mehta, Derivatives Strategist, Shah Investor's Home Ltd.

BHEL dropped 2%, followed by DLF, Sterlite and Larsen & toubro. Banking names also declined with SBI and ICICI Bank dropping around 1.5% each. HDFC Bank, SBI and ICICI Bank together contributed to a 33 points fall on the Sensex.

Meanwhile, Tata Power gained 1.5% at Rs 94. Sun Pharma, Wipro, Maruti Suzuki and Infosys have added 1% each.

Among individual stocks, VST industries has seen a huge jump in trade volumes. The counter has seen trades of 33000 shares so far, as against a two-week average of 6,000 shares.

Hindustan Copper advanced 2% at Rs 256 after the company reported a strong set of Q4 numbers post the market hours yesterday. The Q4 net profit of the company more than doubled to to Rs 137.43 crore and the net sales of the company grew 96.2% to Rs 585.61 crore on y-o-y basis.

BSE market breadth is negative. Out of 2,532 shares traded, 1,409 shares declined while 1,004 shares advanced.