What is your stock market trading view for 12th October and how do you view the events of Monday?

On Monday, the Nifty and Sensex traded sharply higher. However, in the last couple of hours of trading, the indices gave up most of the gains. The Nifty managed to cross the 18,000 mark during the day but ended below the psychological level. Stocks like Tata Motors, Maruti and Coal India were the index leaders on Monday.

Pressure actually came from the IT stocks as TCS came under pressure after the results and gave up more than 6.5% in a single day. The results were actually good but the markets had anticipated much more in the form of top line growth, which was not forthcoming. This also pulled down other IT stocks like Infosys, Wipro and HCL Tech. Dollar was volatile.

Foreign investors were net sellers of Rs.1,303 crore of equities while domestic funds sold Rs.373 crore. That is hinting at some serious short covering in markets. In global market view, the Dow and NASDAQ were down 70 bps. In Europe, FTSE was up while CAC and the DAX were down. SGX Nifty is trading lower by 22 bps in early trades on Tuesday.

The focus now shifts to the big results this week like Infosys, Mindtree and HDFC Bank. Quarterly numbers for the Sep-21 quarter are expected to be generally robust except for the auto sector which is likely to see fixed cost pressures due to lower output. Bond yields and the rupee will be keenly watched with the INR already weakening beyond 75/$.