Markets slipped into the red after opening in the green led by weakness in Banking shares; on the other hand oil & gas and FMCG stocks were leading the gains. The Sensex was down six points to 20,554 and the Nifty also slipped in the red, down 4 points to 6148.
Asian markets were trading strong as US markets greeted the New Year with a rally led by encouraging manufacturing outlook and gains in Financial shares. The Dow Jones Industrial Average and S&P 500 touched two year highs. Dow Jones Industrial Average ended up 93.24 points, to 11,670.75 and S&P 500 surged 14.23 points, to 1,271.87. The Nasdaq Composite Index climbed 38.65 points, to 2,691.52.
In Asia Japan's Nikkei Stock Average surged 1.6% at 10,391 on the first trading day of the year backed by rally in resource shares, South Korea's Seoul Composite was up 0.2%, China's Shanghai Composite kicked off 2011 with 1.3% gain, Hong Kong's Heng Seng gained 0.5% buoyed by property developers. Straits Times and Taiwan Weighted were up 0.6% and 0.1% each.
Back in India technical analysts expect the uptrend to continue with minor corrections. Prakash Gaba said "technically the trend is still intact up and strong supports exists around 6050 and the upside target beyond 6147 is 6254." Even Ravi Nathani said "markets have given a breakout last week; trading strategy still remains buy at dips."
Edelweiss in a research note said "yesterday markets closed above 6150, and have made a higher top higher bottom formation. Daily oscillators are showing bullish readings, while the hourly oscillator (Moving Average Divergence Convergence) rolled a bearish signal, indicating a sideways to corrective price action. Nifty is trading above all key moving averages with a crossover of the 21 and 50 DEMAs (Daily Moving Averages) signaling a medium term buy signal." Edelweiss has maintained a target of 6300 and 6450 and incase of declines to 6100, recommends initiating longs.
Among individual stocks Tata Power was up 0.2% after the company called off its plan to sell 15% stake in two SPVs (Special Purpise Vehicles) which own coal mines in Indoensia to a private equity firm Olympus Capital for Rs 1,392 cr. Wipro was up 1% in the opening trades on reports that it is building the country's faster super computer for ISRO (Indian Research Space Organization). Pfizer rose 1.6% and Dr Reddy's Laboratories gained 0.5% on reports that Pfizer has taken Dr Reddy to court on delay to launch the low cost version of atorvastatin, a copy of Lipitor, a drug which prevents heart problems.
FMCG shares were leading the sectoral pack, Marico gained 2%, followed by Tata Global Beverages, up 1.7% and ITC, up 0.9%.
Oil & Gas index was also one of the prominent sectoral gainers, up 0.6%. Oil India and Petronet LNG climbed 1%, followed by Reliance Industries, up 0.8%.
Hindustan Unilever was the top gainer on Sensex, up 1.3%, followed by NTPC, up 1.2% and Jindal Steel, up 1.1%. From the Banking pack, HDFC Bank and ICICI Bank, down 1.1%, and State Bank of India, down 1% were the top losers on the Sensex.
Midcap and smallcap indices were trading in the green, up 0.5% and 0.6% each. Market breadth was positive with 1131 stocks which advanced for 543 stocks that declined.
