Benchmarks continue downtrend; metal, auto major losers

The Indian equity markets continue to languish in the red in late morning session amid weak global cues and on selling in several front line stocks. Investors were not keen on building any position as global economic outlook is expected to remain quite weak and quarterly results from India Inc likely to be sluggish. However the pace of economic recovery is projected to be slow with notwithstanding a sharp fall in inflation and a possible cut in interest rates. On sectoral front, stocks from metal, automobile, oil and banking sectors were trading weak due to sustained selling pressure. FMCG stocks too were mostly trading weak. Power stocks have moved higher on fairly strong buying enquiries. Select stocks from realty, information technology and healthcare sectors were also up in positive territory. On global front, Asian markets too were not showing any signs of recovery due to lingering concerns over euro zone. Back home, the market breadth remained positive; there were 1,270 shares on the gaining side against 988 shares on the losing side while 83 shares remained unchanged.

The BSE Sensex is currently trading at 15,750.47, down by 98.33 points or 0.62%. The index has touched a high and a low of 15,841.40 and 15,678.30 respectively. There were 8 stocks advancing against 22 declines on the index.

The broader indices were trading in green; the BSE Mid cap and small cap indices trading up by 0.23% and 0.92% respectively. 

The top gaining sectoral indices on the BSE were Power up by 0.84%, Realty up by 0.44%, IT up by 0.32%, PSU up by 0.22% and Health Care up by 0.21%.

While, Metal down by 0.92%, Auto down by 0.87%, Oil & Gas down by 0.87%, Bankex down by 0.66% and FMCG down by 0.44% were the top losers on the index.

The top gainers on the Sensex were BHEL up by 1.84%, Tata Power up by 1.20%, Maruti Suzuki up by 1.17%, Cipla up by 0.66% and DLF up by 0.59%.

On the flip side, Bharti Airtel down by 2.93%, Coal India down by 1.97%, Tata Motors down by 1.79%, SBI down by 1.60% and Tata Steel down by 1.60% were the top losers on the Sensex.

Meanwhile, foreign institutional investors (FIIs) have invested nearly Rs 6,500 crore into the Indian market, including stocks and bonds, in the first week of the January 2012. According to information available with market regulator SEBI, FIIs have purchased equities and debt securities worth a gross amount of Rs 15,168 crore. On the other hand, they have sold shares and bonds worth Rs 8,674 crore in the same period, making a net investment of Rs 6,494 crore for the period.

Experts are of the view that optimistic global cues along with declining food inflation number have helped to enhance investor confidence in the market during the week. In the first week, FIIs were more bullish on the debt market, translating into a net investment of Rs 5,488 crore during the period, whereas their investment in stocks stood at Rs 1,006 crore.

The government on January 1 had announced a new scheme, under which qualified foreign investors (QFI), including overseas individuals were allowed to invest directly in Indian stock markets. This was done with the intention to widen the profile of investors and attract more foreign funds in the wake of FII money being taken-out from the markets.

Further, the move is also expected to trim down market volatility and deepen the Indian stock markets. Earlier, QFIs were permitted to invest only in mutual fund schemes. The foreign investors could earlier invest into Indian markets through opening accounts with SEBI registered FIIs or through participatory notes.

In 2011, FIIs purchased stocks and bonds worth Rs 8 lakh crore, but sold securities worth Rs 7.9 lakh crore, resulting into an investment of Rs 1,7480 crore for the year. On the other hand, investors have gathered towards the debt market and made an investment of Rs 20,293 in the year 2011, while at the same time they stayed away from equity market and pulled out Rs 2,812 crore.

The S&P CNX Nifty is currently trading at 4,712.70, lower by 34.20 points or 0.72%. The index has touched a high and a low of 4,747.55 and 4,695.45 respectively. There were 15 stocks advancing against 34 declining ones and one remained unchanged on the index.

The top gainers of the Nifty were RPower up by 1.97%, BHEL up by 1.68%, Tata Power up by 1.25%, Maruti Suzuki up by 0.98% and Cipla up by 0.77%.

On the flip side, Bharti Airtel down by 3.01%, Sesa Goa was down by 2.60%, Coal India was down by 2.17%, BPCL was down by 1.96% and Tata Steel was down by 1.64% were the major losers on the index.

Most of the Asian equity indices were trading in the red; however Shanghai Composite has bounced back and was trading in green, up by 2.03%.

On the other hand, Hang Seng plunged by 0.60%, Jakarta Composite was down by 0.38%, Straits Times lost 0.96%, Seoul Composite declined by 0.90% and Taiwan Weighted slid by 0.39%.