Indian equities pare gains; trade near the lows of the day

Indian equities pared off gains to trade below neutral line, hovering near the lowest point of the day in the late afternoon session as investors started booking profits in front line counters. The positive sentiments evaporated despite Finance Minister Pranab Mukherjee stating that the overall inflation would drop to 6% by March end. The statement of the FM came in backdrop of weekly food inflation declining well below one percent, to the lowest level since April 2006. Traders were seen piling up position in PSU, IT and Consumer Durables sector while selling was witnessed in Oil & Gas, Metal and Realty sector.

Industry heavyweight RIL was trading with a cut of around more than two percent putting pressures on the market. Also, BPCL from Oil & Gas sector was trading in red exerting pressure on the market. Sterlite, Jindal Steel, Tata Steel and Hindalco from Metal pack too were trading weak. DLF, Unitech, Phoenix Mills, Godrej Properties from Realty sector were in red pulling the markets down. Axis Bank, Kotak Bank, SBI, ICICI Bank, PNB and HDFC Bank from Banking counters were trading in red taking markets lower. However, Infosys, TCS, Wipro and HCL Technologies from IT space were trading firm in green giving the much needed support for the market. Tata Motors, Maruti Suzuki and Hero MotoCorp from Auto sector too were in green helping prevent any further downfall.

On the global front, all Asian markets traded on a mixed note while the European markets were trading in red on pessimistic mood. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 4,650 and 15,500 levels, respectively. The market breadth on BSE was in favor of declines in the ratio of 1277:1334 while 124 scrips remained unchanged.

The BSE Sensex is currently trading at 15,487.10 down by 56.83 points or 0.37% after trading as high as 15,694.05 and as low as 15,487.05. There were 12stocks advancing against 18 declines on the index.

The broader indices were trading on a mix note; the BSE Mid cap index shed 0.04% while Small cap rose 0.13%.

On the BSE sectoral space, PSU up 0.96%, IT up 0.46%, Consumer Durables up 0.42% and TECk up 0.36% were the only gainers while Oil & Gas down 1.10%, Metal down 0.63%, Realty down 0.58%, FMCG down 0.52% and Bankex down 0.46% were the top losers in the space.

TCS up 0.67%, Coal India up 0.65%, Infosys up 0.38%, ONGC up 0.33% and BHEL up 0.29% were the major gainers on the Sensex, while Sterlite Industries down 2.21%, RIL down 2.04%, Jindal Steel down 1.85%, Tata Steel down 1.20% and Tata Power down 1.07% were the major losers in the index.

Meanwhile, in order to meet the internal demand of sugar for the month of January, 2012, the central government has earmarked 17.16 lakh tons of sugar. The government is of the belief that this quantity of 17.16 lakh tons will be adequate for sale in the open market and distribution through ration shops during the first month of 2012.

Out of the total quantity, 2.16 lakh tons will be for the public distribution system (PDS) also called levy sugar while the rest 15 lakh tons will be for sale in the open market also called non-levy sugar. The non levy sugar is further bifurcated into normal quota under which 14 lakh tons of sugar is allocated while the remaining one lakh ton is allotted to the section - availability on account of carryover quantity of unsold/undispatched non-levy sugar quota of December, 2011.

The Food Processing Industries ministry also stated that the sugar factory shall sell and dispatch the entire non-levy quantity released for the month of January, 2012 only within the validity period of the release order i.e. upto January 31, 2012. Besides, the ministry also extended the validity period for sale and dispatch of the non-levy sugar quota released for the month of December by 15 days till January 15, 2012.

The S&P CNX Nifty is currently trading at 4,629.50, lower by 16.75 points or 0.36% after trading as high as 4,690.45 and as low as 4,628.90. There were 21 stocks advancing against 28 declines while 1 stock remained unchanged on the index.

The top gainers on the Nifty were Cairn up 2.33%, Siemens up 1.82%, Sesa Goa up 1.81%, RCOM up 0.95% and BHEL up 0.74%.

IDFC down 3.48%, Sterlite down 2.21%, Jindal Steel down 2.13%, RIL down 2.06% and Grasim down 2.01%, were the major losers on the index.

Asian markets traded on a mix note; Shanghai Composite surged 0.83%, Hang Seng gained 0.20%, Nikkei 225 climbed 0.67%. On the flipside only Straits Times slipped by 0.55%, Jakarta Composite shed 0.03% and Taiwan Weighted eased 0.04%. Stock markets in South Korea remained closed for a public holiday.

The European markets were trading in red, France’s CAC 40 dropped 0.03%, Germany’s DAX shed 0.31% and Britain’s FTSE 100 inched lower 0.32%.