Sensex closes in red; auto majors down as Nov sales slump

The equity markets closed in the red after investors booked profits after last week’s rally. Investors are also cautious ahead of RBI’s policy review next week.

Sensex closed at 19410, down 0.07 percent and the Nifty closed at 5909, down 0.03 percent.

Buoyed by the wedding season, gold extended gains for a fourth session to revisit its highest level in nearly a week, with most importers refraining from deals, eyeing the US Federal Reserve meeting starting Tuesday.

Bringing some respite to the economy, Goldman Sachs has said that India’s GDP may exceed all expectations next year as there are signs that policymakers might spring up positive surprises.

“India in many ways remains the most complex of the four (BRIC nations), with its demographics giving it the best potential GDP growth rate, but its inability to introduce effective policy change is a persistent source of disappointment” leading international fund house Goldman Sachs Asset Management Chairman Jim O’Neill said.

Additionally, in an interview with _CNBC TV18_Atsi Sheth of Moody’s said that she expects FY13 fiscal deficit to stand at 5.5 percent of GDP. “The risk to this forecast is the revenue profile. One is growth, over the next two quarters if growth plateaus or moves slightly upwards then revenues will remain in line and the other is implementation of divestment plan and 2G,” she said

This was slightly better than 74.4 percent in the same period a year ago. This improvement was on the back of some tightening on the expenditure front.

Stocks in news

Wipro closed up 0.61 percent after the company said it will fully acquire LD Waxsons Group, a Singapore-based fast moving consumer goods (FMCG) company for an all cash consideration of about $144 million (nearly Rs 790 crore).

Cairn closed down 2 percent after Goldman Sachs has downgraded it to ’neutral’ from ‘buy’, citing expectations of flat to declining earnings growth, based on its medium-term outlook of gradual moderation in oil prices.

Car sales in India slumped 8 percent in November, dashing hopes of a sustained revival in demand, as an expected festive season boom failed to materialise in a key growth market for global carmakers. This pushed auto stocks down. Maruti Sukuki closed down 1.13 percent , Tata Motors closed down 0.73 percent and Mahindra and Mahindra closed down 0.90 percent.

Sugar stocks including Belrampur Chini closed down 9.25 percent and Shree Renuka Sugars closed down 2.20 percent after Uttar Pradesh after the state raised the price at which sugar mills buy the new season crop by up to 16 per cent to Rs 290 per 100 kg.

Larsen and Toubro closed down 0.64 percent after its Managing Director and CEO K Venkataramanan has sold 2,000 shares of the infrastructure major for about Rs 33.48 lakh.