Capital goods, pharma and oil & gas stocks supported the indices while FMCG dragged by HUL ended in red.
The midcaps marginally under-performed but the index hit a record high as it nears the 13,000 mark.
Analysts feel that corporate earnings will drive the market now ahead of Budget. The big challenge for the market is even though the macro situation will continue to improve, further upside in share prices will depend on the growth in corporate earnings, says Vetri Subramanium, Chief Investment Officer, Religare Invesco Mutual Fund.
In an interview to CNBC-TV18, he says valuations are no longer cheap even if they may not be absurdly expensive. So there is unlikely to be a further expansion in price to earning (PE) multiple, and market performance will be related to earnings growth.
However, major global events like ECB meet and China number are likely to keep Indian market at bay. Geoff Lewis, JPMorgan AMC sees huge inflow of foreign money into Indian equities in the coming days, despite headwinds like appreciating dollar and the trickle down impact of weak commodity prices. Lewis says India will not face the wrath of global liuidity crunch primarily due to the domestic economics (that is on the mend) and a take off in US economy.
Chinese markets saw a sharp slide where the Shanghai composite tumbled nearly 8 percent, taking the index to a 6-year low. Investors turned jittery after the China securities regulatory commission announced that some brokerage firms had been punished for violations of margin-trading rules.
The three largest brokers have been banned from opening new margin trading accounts for three months. Infractions also include allowing customers to delay margin repayments by longer than currently allowed. The move comes after a two-week overhaul.
Darling of the market, HUL was hammered out of shape just after it announced disappointing December quarter earnings. A volume growth of 3 percent during the quarter spooked investors. The stock lost over 5 percent at end.
Among the gainers, Wipro remained star of the day holding around 5 percent gains throughout the day. Though the IT service company posted a better-than-expected Q3 earnings, most brokerages like JP Morgan and Bank of America Merrill Lynch maintained neutral rating on the stock.
GAIL gained 3.5 percent after its CMD BC Tripathi said that the company won’t have to pay subsidies in the second half of this year and is hoping for a resolution to Ratnagiri gas interest payment problems in two weeks.
Among the midcaps, SpiceJet was up 10 percent in hopes of a turnaround plan by new owner Ajay Singh. Aviation Ministry sources also suggest the airline’s recapitalisation plan has been forwarded to the DGCA. The plan may involve an investment of Rs 1,500 crore in the cash strapped airline in three tranches.