The benchmark indices closed flat amid choppy trade ahead of F&O expiry on Thursday. Both indices had started on a weak note following weak global cues. In the second half though, markets showed smart recovery but remained volatile with marginal downward bias. HDFC, SAIL, Bharti Airtel, SBI, TCS, HDFC Bank, Tata Steel, Wipro and Sterlite Industries were draggers while ONGC, NTPC, DLF, BHEL, Reliance Communication, Ranbaxy, Grasim, Maruti, ICICI Bank, Tata Power, Ambuja Cements and L&T were being supportive to these indices. The 30-share BSE Sensex has touched a low of 8,619.22, before closing the day at 8,822.06, down 0.24% or 21.15 points. The 50-share NSE Nifty was down 0.09% or 2.55 points, to 2,733.90. Nifty futures rollover stood at 44%, which added about 1.15 crore shares in open interest, OI. Nifty February futures ended with 6 points discount and March Futures with 24 points discount. Marketwide rollover stood at 38% and stocks futures have seen a rollover of 38%. S&P has revised outlook on India to negative from stable and affirmed BBB- rating on India, which haven't impacted markets much. They expect FY09 fiscal deficit at 11.4% from 5.7% and said deficit to remain high at 11.1% in FY10. Fiscal deficit could widen if next government announces another stimulus package, S&P said. In order to help industry cope under the pressure of the economic slowdown, the Finance Minister, Pranab Mukherjee announced several relief measures in terms of excise duty cuts and reduction in service tax. Finance Minister has cut excise duty on bulk cement to 8% or Rs 230/tonne; cut service tax to 10%; cut excise duty by additional 2%. The excise duty of 8% will be applicable beyond March 31. He also extended custom duty on naptha beyond March 31. A 4% excise duty cut across the board will also be extended beyond March 31. Pranab Mukherjee said that the duty cuts will have some revenue impact. However, exact revenue impact is yet to be estimated. Economic Affairs Secretary said that the revenue loss will be of Rs 30,000 crore because of duty cut. Former Finance Minister P Chidambaram said that the move to cut excise in service tax will motivate the companies to increase products. The government expects the companies to pass on the benefits of excise & service tax cuts to the consumers. BSE Metal index underperformed other indices, down 108.40 points or 2.31%, to close at 4,584.07. JSW Steel, Tata Steel, SAIL, Jindal Saw and Sterlite Industries were down 1.9-6.5%. Banking stocks were also under pressure, Axis Bank, SBI and HDFC Bank lost 1.2-2.6%. ICICI Bank was down just 0.13%. BSE Bankex fell 1.36% or 58.52 points, to 4,240.39. Some selling pressure was also seen in pharma and capital goods. BSE Healthcare Index was down 0.53% or 13.78 points, to 2,582.49 and Capital Goods Index lost 0.48% or 28.73 points, to 5,924.27. Among pharma stocks, Wockhardt, Dishman Pharma, Biocon, Sun Pharma Advanced, Sun Pharma, Cipla and Glenmark were down 1.5-6.8%. ABB fell 3.46%. Siemens, Punj Lloyd and BHEL were down 0.3-0.6% while L&T gained 0.47% in the capital goods space. MTNL, Bharti Airtel and Idea Cellular declined 0.3-0.77% while Reliance Communication rose 1.22% in the telecom pack. BSE IT, Power, Realty, Oil & Gas, Auto and FMCG indices closed almost flat. Market breadth was in favour of declines due to weak broader indices; about 975 shares advanced while 1890 shares declined. Nearly 166 shares remained unchanged. Total traded turnover stood at Rs 55,085.25 crore. This includes Rs 6,940.26 crore from NSE Cash segment, Rs 45,693.52 crore from NSE F&O and the balance Rs 2,451.47 crore from BSE Cash segment. Among broader indices, BSE Midcap index was down 49.27 points or 1.76%, to close at 2,742.45 and Small Cap index fell 1.41% or 44.48 points, to settle at 3,116.11. Syndicate Bank, Educomp Solutions, PVP Ventures, Pantaloon Retail and Everest Kanto tumbled 9-14.6% in the midcap space. EIH Associated Hotel, Shrenuj and Company, MIC Electronics, Sanghi Ind and Allied Digital were down 11.4-13.7% in the small cap space. Among sugar stocks, Bajaj Hindusthan, Balrampur Chini Mills, Triveni Engineering and Shree Renuka Sugars slipped 4.5-9%. Global cues were weak throughout the session. At the time of closing of Indian equities, European markets slipped further. FTSE went down 45 points, to 3,805. CAC was down 51 points, to 2,677 and DAX down 108 points, to 3,828. Asian markets ended sharply lower. Shanghai Composite plunged 4.56%. Hang Seng fell 2.86% and Kospi lost 3.24%. Nikkei, Taiwan and Jakarta were down 1-1.5%.

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