Markets opened marginally higher on back of subdued global cues and deluge of corporate earnings which may not surprise on the higher side. The Sensex was up 66 points, at 18,926 and Nifty surged 14 points at 5669.
Analysts expect markets to trend downwards after China's latest tightening move. HDFC Securities in the morning note said, "market may move downwards in response to higher requirement of reserve ratio announced by China. 18,500 is a crucial support on Sensex, while 19,150 is an important resistance." India Infoline in the morning note said, "one can’t be sure if the turbulence is over. Investors should avoid getting trapped in any relief rallies and wait for some more stability before taking a fresh plunge."
ADAG shares plunged in opening trades. Reliance Infra and Reliance Power fell 5%, Reliance Communication slipped 2.3%, Reliance Capital was down 4% after the Securities and Exchange Board of India (SEBI) issued and order on Friday asking the firm not to partcipate in the capital market. SEBI in the note said that company used money from overseas borrowing to invest in the stock market.
Elsewhere in Asia, China's Shanghai Composite was down 2%, at 2,732 led by losses in financials after the government unexpectedly raised reserve requirement for banks by 50 bps on Friday. Hong Kong's Heng Seng was trading fell 0.4%, at 24,184, mainland Chinese banks and property developers weighed. Japan's Nikkei Stock Average was trading marginally lhigher at 10,500. South Korea's Kospi Composite was trading flat at 2,109.
From the OMCs space, Hindustan Pertoleum, Bharat Petrolem and Indian Oil Corporation gained over 2% each after government hiked petrol prices by Rs 2.54 per litre.
Axis Bank and Indusind Bank were up over 1% ahead of third quarter earnings today. From Capital Goods space Larsen & Tourbo rose marginally by 0.2% and from IT space TCS expanded 1% on expectations of quarterly results.
Tata Steel fell more than 1%to Rs 621 after it fixed the FPO price between Rs 594-610 for its follow-on public offer of 5.7 cr shares, which will hit the markets between January 19 to 21. At the higher end of the price band company is expected to raise Rs 3,477 crore from the FPO,
BSE Bankex was the top sectoral gainer, up 0.9% pulled by Axis Bank, Indusind Bank and Kotak Mahindra Bank, up 1.5%. On the other hand Power shares were leading the losses, down 0.4% dragged by losses in Reliance Infra, Reliance Power, and GVK Power which was down 1.4%.
On the Sensex, prominent losers were Hero Honda, down 1.9%, Tata Motors, down 1.7% and Jaiprakash Associates fell 1.1%. Major gainers were HDFC, off 1.6%, ITC fell 1.6% and Cipla declined 1.1%.
From the broader markets, midcap and smallcap indices were trading flat.
