Traggic fall continued but surprise turnaround in the markets which recovered sharply in the last hour of trading session. It opened marginally in red and traded in negative terrain for major part of the day as Asian cues were not inline to support the Indian markets. Indices traded volatile and churned in both the territories going on a yahoo ride. Market recovered over 400 points from the day's low. Amidst heavy selling pressure the Banking stocks and Refinery sector stood strong. SBI's right issue news is on cards which hit the market & kept SBI in limelight and hence the momentum too. On the other hand latest notification from RBI which allowed the Oil and refineries to hedge foreign exchange exposures to 50% of their oil inventory volumes waved a sign of relief though oil prices hit the $100 / barrel mark. In the last hour of trading session the news floated that the Indian pension funds are approved to invest in Indian markets supplemented by the news that China will ``definitely'' go ahead with a program allowing individuals to invest directly in Hong Kong equities. This lifted the sentiments in the market to recovery strong. At close Realty index down by 6%, metal and power index down over 3%. European indices are trading in green.

Sensex closed down by 76 points at 18526. Weighing on the Sensex were losses in Rel Energy (1605.1,-5 percent), NTPC (227.55,-5 percent), L & T (3941.8999,-4 percent), ONGC (1149.55,-4 percent) and HDFC (2560.8501,-2 percent). Losses were restricted by gains in SBI (2241.8,+4 percent), ACC (1103.3,+2 percent), ICICI Bk (1126.9,+2 percent), Bajaj Auto (2472.55,+2 percent) and Maruti (966.75,+2 percent).

Eveready, part of the BM Khaitan Group a market leader in the dry cell battery industry. The battery business was bought by Mcleod Russel from Union Carbide in a leveraged buy-out but the restructuring was done last year and Mcleod Russel was demerged from Eveready. Now Eveready is a focussed and well established FMCG player. Its portfolio comprises of dry cell batteries, rechargeable batteries, flashlights, packet tea and recently introduced mosquito coils. The company had taken (30%) price hike in batteries last year on the back of high zinc prices. Around 55-60% of company's revenue comes from rural India. Here the consumption slipped as consumers opted delay in consumtion given the sharp rise. This led to a fall in volumes. On an average zinc prices were up 2% yoy. On qoq zinc prices are down by 2%. In July zinc came off to $3000 per tonne and the benefit from this should start flowing given that volume pick up is seen to some extent again. Monsoon is the good period as use of batteries is driven by the Farming community which uses Torches to take care of their fields. There is some threat seen on the back of lower power Consuming LED lights. In a sense thats true.. but we believe that these LED lights will create its own set of consumption. The per capita consumption of cells in India is still very small even as compared to that in South East Asian countries. We are informed that the volume growth is somewhat better in the AA segment in the last couple of months. Profits will be good from the new plant by the 3rd quarter and also the benefit of lower Zinc prices. We have detailed note on this. Do read it to have more clearity.

Apar Industries Ltd (Apar) is a diversified company having presence in Speciality Oil, Aluminium Conductor and Polymers. Its 3 plants located at Rabale-Thane, Silvassa and Nalagarh - Himchal Pradesh. Apar is the largest manufacturer of Transformer Oils in India and the second largest manufacturer of high strength overhead power transmission and distribution conductors. The Company earns around 48% of its revenues from the power sector and 42% from Speciality oil and 10% from Polymers. At current market price valuation are fair; Future is bright on the back of high growth expected in power sector. Business scenario sounds good but concern are many to look at. Do have a look at our deatiled note to know our view on this stock.

Technically Speaking: Sensex witnessed a downtrend as mentioned bounced back from 18250 and witnessed an intra day high of 18,745 and low of 18,183. Declines outnumbered Advances in the ratio of 2.5:1. Volume of Rs 6976 cr was churned through out the day. Sensex has taken support as levels anticipated by us. We also had recommended to cover the shorts when the markets were low during the day. A pullback rally is possible now which could run upto 18900. If sensex fails to hold above that, the next target could be as lower as 17100.

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