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Monday, 29 September 2014

Sensex volatile ahead of RBI policy; midcap, smallcap gain

Equity benchmarks remained directionless ahead of much-awaited RBI monetary policy. The Sensex declined 3.52 points to 26593.59 and the Nifty lost 3.55 points to 7955.35.

However, the broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising 0.5 percent each. About 1107 shares have advanced, 713 shares declined, and 61 shares are unchanged.

 The Reserve Bank of India will announce its monetary policy today at 11 am. Experts do not see any rate cut but they feel there could be SLR cut.

Soumya Kanti Ghosh, Chief Economic Advisor at State Bank of India, expects status quo from the Reserve Bank in its credit policy. In fact he does not see a rate cut this year and the first half of next year.

On the central bank’s tone, Ghosh thinks it would be favourable on the back of positive developments in the past couple of days like the Scotland verdict, the current disinflationary trend and better core numbers.

Though he feels the central bank may cut the statutory liquidity ratio by 25-50 bps, he does not expect any movement in the CRR (cash reserve ratio).

Shares of TCS, Axis Bank, Hindalco Industries and Gail India fell over a percent followed by Infosys, ITC, ICICI Bank, Reliance Industries, and Mahindra and Mahindra with 0.4 percent loss.

However, HDIL topped the buying list, up 1.6 percent. L&T, Bharti Airtel, Tata Motors, HDFC Bank, Sun Pharma, Dr Reddy's Labs, Bajaj Auto, Maruti Suzuki and Tata Power gained 0.3-1.3 percent. More information please visit this site

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