Markets trade choppy after a lower start

Indian markets after a soft start are slowly picking up pace on Monday morning, though volatility is persisting, restricting the benchmarks to move in one direction. Traders seem to be cautious ahead of the major macro data of IIP, CPI and WPI later in the week. There was some buzz in the India Inc on reports that Finance Minister Arun Jaitley may immediately dole out about Rs 13,000 crore in Central Sales Tax (CST) compensation to states in order to garner support for the Constitution Amendment Bill for a goods & services tax (GST). Rate sensitives’ like auto and consumer durables were trading with gains of around a quarter percent on report that banks are now mulling revising their base rates downward after having slashed deposit rates recently. The IT sector was particularly under pressure led by Infosys which is down by over three percent in early trades after four of the founders of the company sought to raise about $1.1 billion by selling stakes in the company at a fixed price of Rs 1,988 each, a 4 per cent discount to Friday's close.

The BSE Sensex is currently trading at 28452.25, down by 5.85 points or 0.02% after trading in a range of 28380.93 and 28494.85. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.39%, while Small cap index surged by 0.51%.

The top gaining sectoral indices on the BSE were FMCG up by 1.03%, Realty up by 0.40%, Power up by 0.35%, Metal up by 0.33%, PSU up by 0.30% while, IT down by 1.88%, TECK down by 1.32% were the losing indices on BSE.

The top gainers on the Sensex were Coal India up by 1.82%, ITC up by 1.57%, Sun Pharma Inds. up by 1.56%, Bharti Airtel up by 0.84% and BHEL up by 0.75%. On the flip side, Infosys down by 2.96%, TCS down by 1.74%, Dr. Reddys Lab down by 1.35%, Sesa Sterlite down by 1.26% and Mahindra & Mahindra down by 0.66% were the top losers.

Meanwhile, India's domestic air traffic grew by 16.3% y-o-y in the month of October, higher than 10% growth in China, the International Air Transport Association (IATA) stated. The IATA highlighted that the significant growth in reported month reflected market stimulation by local carriers, though this was a considerable slowdown compared to September growth of 26.4%. From the beginning of the year, domestic carriers have been offering low fares through a series of discounted ticket schemes to stimulate demand. On global front, IATA stated that global domestic travel demand rose by 5.8% in October compared to the same month last year.

Domestic airlines flew 59.25 lakh passengers in October this year as compared to 50.08 lakh passengers during the same period in 2013. During January-October 2014, the number of passengers carried by domestic airlines was 550.68 lakh as against 507.03 lakh in the year-ago period. Domestic air traffic is expected to enhance in coming months as aviation turbine fuel (ATF) for domestic carriers has become 11.22% cheaper since October and is expected to see more price cuts in the next three months. Domestic carriers are likely to cut fare prices as ATF accounts for over 50% of domestic carriers' operating costs.

The civil aviation industry in India has ushered in a new era of expansion driven by factors such as low-cost carriers (LCC), modern airports, foreign direct investments (FDI) in domestic airlines, cutting edge information technology (IT) interventions and a growing emphasis on regional connectivity. Indian civil aviation industry is amongst the top 10 in the world with a size of around $16 billion. India has a vision of becoming the third largest aviation market by 2020.

The CNX Nifty is currently trading at 8534.75, down by 3.55 points or 0.04% after trading in a range of 8514.50 and 8546.35. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Asian Paints up by 2.85%, Coal India up by 1.85%, ITC up by 1.70%, Sun Pharma Inds up by 1.61% and Zee Entertainment up by 1.30%. On the flip side, Infosys down by 3.06%, TCS down by 1.84%, HCL Tech. down by 1.62%, Dr. Reddys Lab down by 1.43% and Sesa Sterlite down by 1.39% were the top losers.

Asian markets too have turned mixed after mostly a green start, Nikkei 225 was up by 7.13 points or 0.04% to 17,927.58, Shanghai Composite gained 41.66 points or 1.42% to 2,979.31, Hang Seng surged by 85.32 points or 0.36% to 24,087.96.

On the other hand, Jakarta Composite lost 30.61 points or 0.59% to 5,157.38, FTSE Bursa Malaysia KLCI declined by 8.26 points or 0.47% to 1,741.11, KOSPI Index was down by 6.41 points or 0.32% to 1,980.21, Taiwan Weighted was lower by 2.18 points or 0.02% to 9,204.39 and Straits Times declined by  1.8 points or 0.05% to 3,322.59