Sensex ends flat on rupee fall, Sesa Goa surges 8%

3.38 pm: Markets end flat, rupee falls

The Indian markets closed flat today despite a good start in the morning following the fall of rupee.

The BSE Sensex closes at 18539.13, up 0.11 percent while the Nifty closed at 5470.45, down 0.02 percent.

The rupee weakened on Monday, tracking weaker offshore rates, as sustained foreign selling in equities continued to raise concerns about the gaping current account deficit.

At 3.46 pm, the rupee is trading at 64.28 against the dollar.

Sesa Goa ended up 8.6 percent ahead of of the company’s inclusion in the BSE Sensex on Tuesday. BSE bankex fell more than 1 percent ending as the worst performer of the sectoral index. Axis Bank fell 5 percent, Kotak Mahindra down 2.8 percent - top losers in the BSE bankex.

Meanwhile, Fitch ratings said it was getting more challenging for India to meet its fiscal deficit target in the current fiscal year ending March 2014 with revenues slowing. The rating agency is also monitoring India’s growth, inflation, public finances and the current account deficit and its funding, analyst Art Woo said in a teleconference on Monday.

12. 20 pm: ‘Market scenario similar to 2001, early elections could be great trigger’

Ridham Desai, MD, Morgan Stanley says this is a ‘relief rally and those who missed the bus earlier can look to sell now.’ Desai is focusing on a bear case scenario and foresees the Nifty sliding all the way to 4800 by year-end. Speaking exclusively to CNBC-TV8 as a guest editor, he said that the market situation now is similar to 2001 scenario and post recent moves it has not remained cheap.

He believes early elections could be a great trigger for the market, so for those looking to play equities from a six-12 months view, fixed income products offer better opportunity. “Betting on equities is advised only to those market participants who hold a three-five years view,” he said.

At 12.25 pm, the BSE Sensex is at 18626.95, up 107 points, while the Nifty is at 5494.15, up 22 points.

10. 15 am: CAD can even go lower than $70 bn, says Rangarajan

The country’s current account deficit is likely to be reined in at $70 billion or even lower this year, Prime Minister’s Economic Advisory Council Chairman C Rangarajan told CNBC-TV18.

He said the estimate has taken into account only a slight improvement in exports. But if the advanced economies revive, there will be better pick up in exports and with the commodity prices declining globally, there are chances that the CAD will be lower than the estimated $70 billion.

At 10:11 am, the Sensex and Nifty were 18700 and 5520, up about xxxx percent. The rupee was down but holding on to the 64.07-64.10 levels.

10. 05 am: Rupeebonds weaken at open; further falls expected

The rupee weakened in opening trade on Monday, tracking a lower rupee in the non-deliverable forward markets, while bond yields also edged up on back of the currency’s fall, traders said.

Traders expect the rupee to drop further due to month-end dollar demand from importers likely later in session.

9. 20 am: The Indian markets opened in the green today on global cues.

The BSE Sensex openedat 18623, up 0.64 percent, while the Niftyopened at 5506, up 0.65 percent.

The Indian rupee opened slightly lower at 63.70 against Friday’s close of 63.20. According to experts, the rupee may continue to gain this week as investors hope government and Reserve Bank will make more efforts to stabilise the market.

Finance MinisterP Chidambaramand senior ministry officials met top bankers and overseas investors over the weekend and discussed fund-raising plans apart from allaying the fears of FIIs over capital control.

Globally, in the US, Dow regained 15000 on Friday and indices advanced as a sharp drop in new home sales added to hopes that fed might delay the tapering programme. European markets too advanced on positive economic data. Indian equities also continued their recovery momentum, theNiftyclosed the day’s trade at 5471 up 1.2 percent and theSensexclosed at 18,519 which was 206 points up.

Asian markets were following the suit today morning. Nikkei extended the previous session’s 2 percent rally, but trade was subdued as dollar-yen retreated from last week’s three-week high of 99.1 yen. Kospi is up about 0.5 percent thanks to a rally in domestic manufacturers.

A Morgan Stanley’s report states that therise in US real rates and dollar has pushed Asia to lift its real rates and if this trend continues it will bring Asia to a situation that would be similar to the 1990s.

Meanwhile, Planning Commission Deputy Chairman Montek Singh Ahluwalia said the government has not drawn any red line on the Indian rupee, which he felt has over depreciated.“I don’t believe that either the government or the RBI have taken a view that we are drawing a red line on which Indian rupee should be. At the moment, in my view, the Indian rupee is over depreciated,” Ahluwalia said.

Ahluwalia has also suggested a cut in wasteful government expenditure as a strong and necessary measure to control the fiscal deficit but defended financial burden of the Food Security.

Stocks in news:

BHEL is up 1.98 percent after EGoM on ultra mega power plants met in the capital and gave a fillip to the beleagured power sector.

Shares in India’s Hexaware Technologies Ltd rose 4 percent after Baring Private Equity Asia agreed to buy a controlling stake in it for about $420 million.

ONGCis down 0.92 percent in the morning trade after itsarmONGCVidesh has agreed to pay $ 2.64 billion to buy a 10 percent stake in a Mozambique gas field from Anadarko Petroleum Corporation.

IDFC is down 0.72 percent after theReserve Bank of India notified on Friday the decrease in FII limit in IDFC to 54 percent from 74 percent earlier.

Axis Bank is up 0.23 percent after it announced ithas raised interest rates on FCNR dollar deposits of three-four years tenure by 100bps to 4.78 percent. On NRE deposits of tenure over five years has been raised to 5.56 percent against 4.56 percent earlier.