makin97 NSETIPS @ RAKESH MAKIN: MARKET ENDED 11.07.2011 MONDAY

WERE TODAY'S GAINERS

MARKET ENDED 11.07.2010 MONDAY

SENSEX 18721.39 -136.35

NIFTY 5616.10 -44.55

NASDAQ 2812.84 -46.97

UPDATEDTIME 09.28 PM 05 JULY 2011

Equities ended in the negative terrain for second straight session as traders booked profits following weakness in the European markets. Realty, technology and metals were the major underperformers while FMCG and oil&gas stocks moved higher. Wary investors also chose to remain on sidelines ahead of quarterly earnings from IT major Infosys Technologies.

We expect Infosys to report revenues at $1,677 million (+4.7% QoQ ahead of co's guidance of ~2.6-3.6% QoQ growth) aided by ~100 bps cross currency gains (v/s guidance that built in ~50 bps gains).

Operating Margins to decline by ~220 bps QoQ to 29.9% on account of higher US$/INR and wage hikes. PAT at Rs. 17.4 billion to decline by ~4.5% QoQ driven by lower op. margins and lower other income (Rs. 3.6 bn Vs. Rs. 4.2 bn in Q4FY11)

Expect Infosys to guide for 5-6% QoQ growth for Sep'11 Qtr and to raise it' FY12 EPS outlook marginally by ~2-2.5% to Rs 128-131 (V/s Rs 126-128 earlier) driven by Q1 beat and some margin upsides.

The market opened on a weak note and slipped lower as the session progressed. According to analysts, the benchmarks are close to important support levels and if these are breached then some further selling is expected in the short term.

"We are near important support levels of 5600/18675. If Nifty fails to hold this then it may slip to 5560. A 'dark cloud cover Japanese candle stick formation' is formed on the daily charts of Nifty futures. From short-term perspective, the market is likely move sideways with negative bias.

National Stock Exchange's Nifty closed at 5616.10, down 44.55 points or 0.79 per cent. The broader index touched a high of 5652.90 and low of 5601.70 in trade today.

Bombay Stock Exchange's Sensex ended at 18721.39, down 136.65 points or 0.72 per cent. The 30-share index hit a high of 18843.97 and low of 18679.49 intraday.

BSE Midcap Index was down 0.31 per cent and BSE Smallcap Index moved 0.42 per cent lower.

Amongst sectoral indices BSE Realty Index fell 2.54 per cent, BSE IT Index was down 1.73 per cent, BSE Metal Index declined 1.54 per cent and BSE Bankex inched 1.39 per cent lower. BSE FMCG Index was up 0.52 per cent and BSE Oil&gas Index moved 0.13 per cent higher.

"Fundamentally, we are positive on the banking sector. However, in the past eight sessions, the banking stocks have moved higher and hence some correction is expected.

Hindalco (-4.17%), DLF (-3.52%), Axis Bank (-3.24%), Wipro (-3.12%), SAIL (-3.11%) and Infosys Technologies (1.69%) were the major Nifty losers.

Shares of Hindalco Industries were under pressure after reports that the Environment Ministry withheld clearance for the Mahan coal block in Madhya Pradesh, which is intended to fuel power plants of the aluminium producer, and referred the matter to a Group of Ministers.

Maruti Suzuki is once again headed for a confrontation with the rebel workers' body at its Manesar plant that witnessed the 13-day strike last month. Fresh trouble is brewing at the plant as the rebel body Maruti Suzuki Employees Union has decided to boycott the union election slated for July 16. The company has said it neither recognizes the rebel body nor is ready to talk to them.

ONGC (1.57%), M&M (1.31%), ITC (1.17%), Grasim (1.07%) and Sesa Goa (0.73%) were amongst the top gainers.

Market breadth was negative on the NSE with 1575 losers against 1336 gainers.