Sensex, Nifty trim losses; Tata Motors, SBI, Maruti rebound

FM on Bihar elections results: Attributing the NDA's defeat in Bihar assembly elections to 'huge index of opposition unity', Finance Minister Arun Jaitley today said it will not impact the economic reforms process. "I don't see it as a setback to the economy... structural reforms will continue. They should continue at a rapid pace," he said. Admitting that some irresponsible statements by certain BJP functionaries during the course of elections did change the narrative, Jaitley said the "index of opposition unity" was one of the biggest factors that led to the victory of the Mahagathbandhan in the Bihar assembly elections. While the ruling NDA managed to get 58 seats (BJP 53) in the 243-member Bihar assembly, Mahagathbandhan got 178 seats. 10:30 am Andhra Bank's bad loans: State-run Andhra Bank is seeking to sell bad loans worth about Rs 1,388 crore (USD 209 million) to asset reconstruction companies, according to a newspaper advertisement today. 

The bad loans are in 29 accounts, the bank said in the advertisement. Andhra Bank on Saturday reported a 74 percent increase in its second-quarter net profit to 2.51 billion rupees from a year earlier. Its gross bad loan ratio eased to 5.71 percent from 5.75 percent in the first quarter. 

10:15 am FII View: Mahesh Nandurkar, CLSA says the BJP has suffered a crushing defeat in Bihar, clearly a setback for PM Narendra Modi and investor sentiment. A lot now depends on how this defeat is perceived by PM Narendra Modi, he adds. On the positive side, he feels the government may accelerate delivery of services such as 24X7 power. On the other hand, legislative reforms will become tougher. According to him, the market may fear that the prime minister will start spending more time on party politics and he would have less time available for governance. However, Nandurkar believes the Indian growth story remains intact and the potential overreaction by equity investors would be a buying opportunity. 

The Indian market has already underperformed MSCI EM by 3-4 percent over the past two weeks, so some negative political news is already priced in, he feels. 
Hoping to see reforms push post Bihar defeat: Religare Cap 10:00 am Market Check The market trimmed some losses in morning trade with the Sensex S&P BSE Sensex falling 333 points or 1.27 percent to 25,932.01 and the Nifty down 104.80 points or 1.3 percent to 7849.50. The broader markets recovered sharply from day's low, down 0.3 percent. Tata Motors (up 2 percent), State Bank of India (up over 1 percent) and Maruti Suzuki (up over 1 percent) rebounded amid market weakness. Sun Pharma also cut losses to 4 percent from more than 6.5 percent seen in early trade post Q2 earnings. Dr Reddy's Labs lost 3.5 percent. Shares of Infosys, HDFC, ICICI Bank, HDFC Bank, Reliance Industries, L&T, ONGC and Bharti Airtel were down 1-2 percent.

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