Benchmarks off day’s low; still into negative territory

Benchmark equity indices although off day’s low were still languishing into the negative territory, in absence of buying activity and tailing a negative start of European markets on weak economic data from Germany and concerns over the future path of the Federal Reserve's monetary policy. August Industrial output figures for the country showed their worst fall for five and a half years, with the month-on-month figure slipping by 4%.  Back home, losses were limited as growth in services activity picked up pace in September as order books filled up at a faster rate, with HSBC Services Purchasing Managers' Index (PMI), compiled by Markit, reversing a slowdown seen in the previous two months and rising to 51.6 in September from 50.6 in August. Off day’s low, both Sensex and Nifty were holding above the crucial 26,400 and 7,950 levels respectively, with steep losses of around sixth tenths of a percent. Meanwhile, broader indices were trading on a mixed note.

On the BSE, stocks from Realty, Auto and Technology counters were the prominent gainers of the session, while those from Metal, Capital Goods and Public Sector Undertaking (PSU) counters were the weak links of the trade. In stock-specific activity, shares of tyre manufacturers have rallied by up to 10% in otherwise subdued market on hopes of higher margins due to falling rubber prices. Prices of natural rubber, the most important raw material for the industry, have dropped to multi-year low in the international market on account of poor demand from countries like China and oversupply of the commodity. The overall market breadth on BSE was in the favour of declines which thumped advances in the ratio of 1404:1182; while 118 shares remained unchanged.

The BSE Sensex is currently trading at 26418.05, down by 149.94 points or 0.56% after trading in a range of 26376.96 and 26570.38. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in green and red; the BSE Mid cap index was down by 0.13%, while Small cap index was up by 0.02%.

The gaining sectoral indices on the BSE were Realty up by 0.65%, Auto up by 0.15%, TECK up by 0.08%, IT up by 0.03%, while Metal down by 1.83%, Capital Goods down by 1.17%, PSU down by 0.79%, Consumer Durables down by 0.79%, INFRA down by 0.61% were the losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 2.06%, Hindustan Unilever up by 0.94%, Maruti Suzuki up by 0.51%, NTPC up by 0.32% and TCS up by 0.30%. On the flip side, Hindalco down by 3.51%, HDFC down by 2.76%, Sesa Sterlite down by 2.73%, Cipla down by 2.06% and Tata Steel down by 2.05% were the top losers.

Meanwhile, in a potential development which could increase the power tariff in the nation’s capital, Delhi Electricity Regulatory Commission (DERC) is all set to take a decision on ‘re-adjusting ‘the tariff by the end of the month after examining the petitions of three private discoms to review Power Purchase Adjustment Cost (PPAC).

Earlier, while increasing the power tariff by up to 7.5% for domestic consumers, the DERC in July had withdrawn Power Purchase Adjustment Cost (PPAC) of around 8% till October. This withdrawal of PPAC resulted in marginal decline of tariff for the consumers, whose monthly consumption did not exceed 400 units.

Also, DERC in January hiked the fuel surcharge to the tune of 8% for BSES Yamuna Power, 6% for BSES Rajdhani and 7% for Tata Power Delhi Distribution. The private power distribution companies, particularly, BRPL and BYPL, which supply power in 70% areas in Delhi have been demanding significant hike in tariff on the back of rise in power purchase cost. According to DERC figures, the private discoms operating in the city have a revenue gap of a whopping Rs 19,500 crore.

So far, Delhi has witnessed series of hike in power tariff in the last two years. The tariff was hiked by 22% in 2011 followed by 5% hike in February 2012, 2% hike in May 2012 year and again by 26% for domestic consumers in July 2012

The CNX Nifty is currently trading at 7895.35, down by 50.20 points or 0.63% after trading in a range of 7883.35 and 7943.05. There were 16 stocks advancing against 34 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 2.00%, Hindustan Unilever up by 0.76%, NTPC up by 0.54%, IDFC up by 0.51% and Maruti Suzuki up by 0.47%. On the flip side, Hindalco down by 3.61%, Cairn India down by 3.37%, Jindal Steel & Power down by 3.28%, Ultratech Cement down by 3.27% and Sesa Sterlite down by 2.86% were the top losers.

Asian markets were trading mostly higher; with FTSE Bursa Malaysia KLCI trading higher by 4.37 points or 0.24% to 1,845.19; KOSPI Index gaining by 4.52 points or 0.23% to 1,972.91; Shanghai Composite rising by 6.16 points or 0.26% to 2,363.87; Jakarta Composite advancing by 30.12 points or 0.6% to 5,030.26 and Hang Seng adding 124.24 points or 0.53% to 23,439.28.

On the flip side, Nikkei 225 was trading lower by 107.12 points or 0.67% to 15,783.83; Taiwan Weighted was edging lower by 54.33 points or 0.6% to 9,040.81 and Straits Times declining by 8.3 points or 0.26% to 3,244.94.

European markets were trading mostly lower; with Germany’s DAX edging lower by 50.71 points or 0.55% to 9,158.80; France’s CAC sliding by 18.82 points or 0.44% to 4,267.70 and UK’s FTSE 100 shedding 18.57 points or 0.28% to 6,545.08.