Markets recover from day's low in afternoon session

Indian bourses continued to trade in red in the afternoon session as selling momentum in the equities persisted, however the losses were capped and some recovery from day's low levels was seen as buying appeared in IT, teck and realty stocks. However, most of sectoral indices were trading in red and sharp selling witnessed in capital goods, power and oil and gas stocks dragged the major indices lower. Weak global cues due to growing concerns over the crisis in Iraq coupled with depreciation in rupee value dented investors’ sentiments. Investors were worried that high oil prices and a weak rupee could add to inflationary pressures. There was also cautiousness among investors ahead of wholesale price index (WPI) data to be released later in the day. Selling was broad based with both small cap and mid cap indices trading down by over 0.40%. However, investors were seen piling up position in realty, healthcare and FMCG stocks as sentiments got some support as Finance Minister Arun Jaitley has asserted that the government will soon take measures to put the economy of the country back on track. On stock specific front, shares in Tata Consultancy Services were trading higher by around 1.61% to Rs 2,250 after the company kept its outlook on first-quarter margins and revenue unchanged. D B Realty surged almost 20% to Rs 104 on back of heavy volumes on the bourses.

On global front, most of the Asian equity indices were trading in red with Hang Seng down by 0.03% and Nikkei down by 1.08% amid fears over the escalating crisis in Iraq. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 7,600 and 25,500 levels respectively. The market breadth on BSE was negative, out of 2,573 stocks traded, 944 stocks advanced, while 1,543 stocks declined on the BSE.

The BSE Sensex is currently trading at 25,186.32 down by 41.85 points or 0.17% after trading in a range of 25,268.41 and 25,076.28. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.44%, while Small cap index down by 0.73%.

The gaining sectoral indices on the BSE were IT up by 1.38%, Teck up by 1.07%, Realty up by 1.01%, Healthcare up by 0.53% and FMCG up by 0.12%. On the flip side, Capital Goods down by 1.60%, Power down by 1.17%, Oil and Gas down by 0.82%, Consumer Durables down by 0.76% and Bankex down by 0.63% were the losing indices on BSE.    

The top gainers on the Sensex were Gail India up by 2.47%, Infosys up by 1.93%, Sun Pharma up by 1.91%, SSLT up by 1.74% and TCS up by 1.61%. On the flip side, L&T down by 2.23%, M&M down by 1.72%, Axis Bank down by 1.53%, RIL down by 1.39% and Tata Power down by 1.21% were the top losers on the BSE.

Meanwhile, amid growing demand of power due to sweltering heat flowing in most parts of the country, Industry Body Assocham has stated that the government should take measures to ensure that grid discipline is maintained. Assocham stressed that frequent power cuts in north Indian states which are also coping with severe heat wave reflects that low investment has been made in upgrading transmission systems and transformers.

Assocham suggested that aerial patrolling of transmission lines both at the national and state levels along with better emergency restoration systems should become government’s priorities. Inability of distribution networks to cope with emergency situations like thunder storms, etc and over-drawal of power by states are the biggest risks, which can snap power lines for long hours and even days. Therefore, the government should take action against the states which are over-drawing power from the transmission lines, industry body added. Emphasizing that the quality supply of power is crucial for the economic growth of the country, Assocham added that life cycle of the towers and transmission equipment should be strictly monitored and replacements should be done without any compromises.

In India, electricity is produced with the help of coal, crude oil, water and natural gas. The Indian power sector is the fifth largest and one of the most diversified sectors in the world with an installed capacity of around 230 GW, out of which coal-fired plants account for about 68 percent of India's installed electricity capacity. In spite of large power capacity addition over the past six years, the country has been witnessing peak hour power deficit at around 3-5 percent due to high demand. As per the latest Central Electricity Authority (CEA) forecast, India is likely to witness a power shortage of 5.1 percent compared to the demand in the current financial year, with southern and north-eastern regions expected to face high deficits.

The CNX Nifty is currently trading at 7,529.10 down by 13 points or 0.17% after trading in a range of 7,548.60 and 7,487.55. There were 21 stocks advancing against 29 declining on the index.

The top gainers of the Nifty were Gail up by 2.85%, DLF up by 2.00%, Infosys up by 1.82%, Sun Pharma up by 1.79% and TCS up by 1.74%. On the flip side, L&T down by 2.25%, Power Grid down by 1.95%, M&M down by 1.82%, Reliance down by 1.56% and Ultra-tech Cement down by 1.46% were the major losers on the index.

Most of the Asian equity indices were trading in red; Hang Seng down by 0.03% to 23,312.83, Nikkei down by 1.08% to 14,934.23, Straits Times down by 0.06% to 3,291.33 and Jakarta Stock Index down by 0.42% to 4,905.73. While, Taiwan Weighted up by 0.07% to 9,202.93 and Shanghai Composite up by 0.60% to 2,083.95