Indian shares ended Monday's volatile session a tad lower, as investors locked in some gains following Friday's sharp rally. Global cues remained firm on continued optimism over the European pact, helping limit the downside to some extent.
On the macro front, activity in the Indian manufacturing sector increased at a steady pace in June, data from a survey by Markit Economics and HSBC Bank showed today. The seasonally adjusted purchasing managers' index (PMI) for the manufacturing sector came in at a four-month high of 55 in June from 54.8 in May, with new business increasing notably during the month, helped mainly by product quality improvement and stronger demand.
However, India's exports fell 4.16 percent from a year earlier in May to $25.68 billion, mainly due to demand slowdown in the developed markets, government data showed.
The benchmark 30-share BSE Sensex moved in the range of 17,487-17,363 before ending 31 points or 0.18 percent lower at 17,399, with only 13 of its components declining. The broader Nifty index ended almost unchanged at 5,279, while the BSE mid-cap and small-cap indexes rose about a percent each.
FMCG stocks, a couple of automakers and shares of software services exporters were among the prominent declines, while realty, consumer durable, banking, power and metal stocks paced the gainers list.
Hindustan Unilever fell 1.6 percent as it gave a 23 percent pay hike to Nitin Paranjpe, CEO of the company. Tata Motors, India's largest automaker, lost 1.5 percent on posting a 3 percent decline in June vehicle sales. Bajaj Auto eased 0.7 percent and Hero MotoCorp slid 1.3 percent.
However, Maruti Suzuki India rose 0.9 percent after reporting a 20 percent rise in June vehicle sales. Mahindra & Mahindra added a percent as the utility vehicle maker reported a 20 percent jump in June sales on the back of strong rural demand.
Infosys slipped marginally and TCS lost 1.4 percent after Macquarie Equities Research downgraded IT services sector to 'underweight' from 'overweight' citing demand concerns.
ICICI Bank slid 0.6 percent after the private sector lender sold its entire debt exposure in Kingfisher Airlines to a debt fund operated by Kolkata- based Srei Infrastructure Finance. Rival HDFC Bank advanced 1.8 percent and state-run lender SBI added a percent.
Telecom stocks gained ground after the government deferred a crucial meeting of the reconstituted Empowered Group of Ministers on auction of telecom spectrum. Bharti Airtel rose 1.6 percent, Reliance Communication gained 1.1 percent and Idea Cellular climbed 2.4 percent. Reliance Industries, India's most valued stock, moved both ways before finishing unchanged.
Kingfisher Airlines fell 0.8 percent after the beleaguered airline canceled four of its flights from Mumbai due to a strike by a section of its pilots. Godrej Properties eased 0.9 percent after it created a Rs 770-crore development fund with a clutch of global investors to develop residential properties in the country.
Reliance Power declined 0.8 percent after the company filed for arbitration against 11 state distribution companies to resolve a tariff dispute.
GVK Power Infrastructure rallied 2.3 percent on reports that the infrastructure major expects to achieve financial closure for its $10 billion Alpha coal and rail project in Australia by March 2013. Adani Ports and Special Economic Zone jumped 3 percent after the company signed a pact to build a dry bulk terminal at Kandla Port in Gujarat with an investment of Rs.1,200 crore.
Pratibha Industries soared 8 percent on bagging orders worth Rs 1491.59 crore in tunneling and building division. Arvind gained 3.5 percent after workers at its Ahmedabad mill called off their 26-day strike. Atul rose 0.7 percent on reports that it is close to selling a 20 percent stake in its aromatic unit.
Elsewhere, most Asian stocks extended Friday's rally today and European stocks were firm around eight-week highs, but the euro fell against the dollar ahead of this week's European Central Bank monetary policy meeting. Speculation is rife that the the central bank is likely to reduce rates by 25 basis points to 0.75 percent, a move that could weigh on the euro.
Meanwhile, final estimates released by Markit Economics showed that the euro area's manufacturing sector contracted for the eleventh straight month in June. In economic data out of Asia, Chinese manufacturing activity deteriorated at a faster clip in June than a month earlier, as sagging demand abroad took a toll on new-order bookings and employment.
by RTT Staff Writer
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