Post session - Quick review

Local equity markets staged a decent come back on the last trading day of the week as benchmark indices after recovering substantial losses ended the day with gains albeit slender. Qualms about the ability of euro zone countries to refinance their huge public debt ahead of a French bond auction dampened global investor risk appetite in early deals, including that of Indian equity markets. However, the recuperation that chased the equity markets post second half of the session took benchmark indices near their neutral lines with slim gains.

On the global front, Asian equity indices ended in red for a second day as higher borrowing costs in a French bond auction stoked concerns that Europe's debt crisis is deepening, thereby overshadowing improving economic data in the US. On Thursday, in the US, investors were encouraged by a report from job market. Weekly unemployment claims declined again, one day before a crucial report on the national jobs picture in December. Meanwhile, borrowing cues from European markets, local equity markets too gained some traction. European shares edged up on Friday ahead of a US jobs report that is expected to provide more evidence that the world's biggest economy is strengthening.

In its early deals, European shares were heavily undermined by deep-rooted concerns about a possible default by struggling countries such as Greece, expectations for credit downgrades of top-rated euro zone economies including France and worries over whether highly-indebted countries such as Italy and Spain could successfully refinance their maturing debts.

Back home, investors were put off with hawkish comments from Finance Minister. However, late hour short covering in blue chip stocks mainly yanked the benchmark indices higher. Finance Minister said that the government's fiscal deficit as a percentage to the gross domestic product may be higher than the budget projection. The budget for 2011/12 had projected the country's fiscal deficit at 4.6 percent of GDP.

Stocks from Capital Goods, Power and TECk counters remained the biggest laggards. While, stocks from Fast Moving Consumer Goods (FMCG), Oil & Gas and Banking counter topped the list of gainers. The 30-share index, which had lost over 82 points in the past two sessions, gained over 25 points to settle above 15800 mark. Similarly, 50 shares widely followed index- Nifty-on NSE-manage to close near its neutral line with slender gains. However, the broader markets after flip flopping in red showcased a mixed closing. The overall market breadth on the BSE ended in positive; advances and declining stocks were in a ratio of 1465:1260 while 122 scrips remained unchanged.

The BSE Sensex gained 27.79 points or 0.18% and settled at 15,884.87. The index touched a high and a low of 16,001.31 and 15,664.91 respectively. 15 stocks advanced against 15 declining ones on the index (Provisional).

The BSE Mid-cap index lost 0.03% while Small-cap index was up by 0.05%. (Provisional)

On the BSE Sectoral front, FMCG up 1.05%, Oil & Gas up 0.99%, Bankex up 0.64% and HealthCare up 0.31% were the only gainers while Capital Goods down 1.01%, Power down 0.76%, TECk down 0.75%, Realty down 0.68%, and Consumer Durables down 0.46% were the top losers.

The top gainers on the Sensex were HDFC Bank up 2.66%, RIL up 2.54%, Hindalco Industries up 2.06%, Maruti Suzuki up 1.79% and ITC up 1.43%.

On the flip side, Hero MotoCorp down 5.55%, JP Associates down 4.67%, Bharti Airtel down 4.15%, Jindal Steel down 2.86% and DLF down 2.76% were the top losers in the index. (Provisional)

Meanwhile, in order to recapitalize public sector banks, the Ministry of Finance is aiming at infusing capital worth Rs 17,000 crore into PSU banks in the ongoing fiscal year ending March 2012. The move will help state owned banks in meeting their capital requirements and enhancing lending operations. In the previous fiscal year 2010-11, the government had infused capital to the tune of Rs 20,157 crore into public sector banks.

Over and above the Budget provision of Rs 6,000 crore, the ministry is likely to seek additional Rs 12,000 crore through supplementary demands in Parliament for capital infusion in PSU banks during the current fiscal. The capital infusion initiative of the government, which had already committed to providing adequate capital to public sector banks so as to maintain their Tier-I capital at 8%, is likely to prove beneficial for nation’s major lenders including State Bank of India, Bank of Baroda, Union Bank of India, IDBI Bank, and Syndicate Bank.

The public sector banks are required to maintain high level of financial and functional efficiency as the finance ministry has made it clear that capital support from the government in future would be linked to their efficiency. Meanwhile, Financial Services Secretary DK Mittal had earlier opined that capital of about Rs 3.5 lakh crore will be infused into the state-run banks by 2021. A committee headed by Finance Secretary RS Gujral is busy carving out a strategy for capitalization of public sector banks over a period of next 10 years.

India VIX, a gauge for market’s short term expectation of volatility lost 1.73% at 25.46 from its previous close of 25.91 on Thursday. (Provisional)

The S&P CNX Nifty gained 11.30 points or 0.24% to settle at 4,761.25. The index touched high and low of 4,794.90 and 4,686.85 respectively. 26 stocks advanced against 23 declining ones while 1 stock remained unchanged on the index. (Provisional)

The top gainers on the Nifty were Reliance Communications up 5.77%, Reliance Infra up 4.50%, BPCL up 3.90%, Reliance Power up 3.81% and Reliance Industries up 2.80%.

On the other hand, Hero MotoCorp down 5.48%, JP Associates down 4.84%, Bharti Airtel down 4.05%, Jindal Steel down 3.36% and IDFC down 3.03% were the top losers. (Provisional)

The European markets were trading in green, with France's CAC 40 up 0.65%, Germany's DAX up 0.42% and Britain’s FTSE 100 up 0.24%.

Sentiment remained bearish in the Asian region as most of the counters snapped the last day of the week in the negative terrain as concerns over the eurozone debt crisis overshadowed another batch of upbeat US jobs figures. In Spain the new economy minister warned that banks may face up to 50 billion euros ($65 billion) in bad loan provisions. Meanwhile, Japanese Nikkei declined over a percentage point as investors grew cautious ahead of a long weekend against the backdrop of Europe debt crisis and a still-high yen. Hang Seng and Seoul Composite too lost over a percent in the trade. However, Chinese Shanghai advanced over half a percent as energy producer PetroChina jumped after Beijing raised a threshold for a so-called windfall tax, effectively reducing oil producers’ taxes. Banks and resource stocks also climbed after hefty recent losses, although many property developers declined on Chinese bourses.