Markets continue trading subdued in absence of buying activity

Local equity markets continued trading subdued in absence of buying activity despite optimistic global set-up and the release of positive macro-economic data. Local equity markets after witnessing drubbing past three trading session, apparently now witnessing consolidation, which led Sensex and Nifty trade below psychologically crucial 29,000 (Sensex) and 8,750 (Nifty) levels respectively, with losses of around one tenth of a percent. Meanwhile, broader indices too succumbing to selling pressure were trading mix at this point of time.

On the global front, Asian shares took Wall Street lead to reach three months peak on Wednesday as revived risk sentiment dented the US dollar and sovereign bonds, though it was unclear how long this latest mood swing would last. However, any downside was limited after a survey suggested that China's services sector grew at the slowest pace in six months in January only added to the expectations of more stimulus.

Closer home, most of the sectoral indices on BSE were reeling under pressure, nevertheless stocks from Capital Goods, Banking and Power counters were the prominent losers of the session, which were majorly dragging the markets lower. On the flip side, stocks from Metal, Realty and Oil & Gas counters were the prominent gainers of the session. In stock- specific action, shares of two public sector oil marketing companies lost steam after global crude oil prices surged in the previous trading session. Besides, Auto stocks continued trading lower after reporting their monthly sales figures. Additionally, banking stocks continued to tank after RBI in much anticipated move left key rates unchanged in previous monetary policy review. The overall market breadth on BSE was in the favour of declines which thumped advances in the ratio of 1320:1265; while 117 shares remained unchanged.

The BSE Sensex is currently trading at 28981.94, down by 18.20 points or 0.06% after trading in a range of 28867.00 and 29133.62. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading mix; the BSE Mid cap index was down by 0.11%, while Small cap index up by 0.23%.

The gaining sectoral indices on the BSE were Metal up by 1.93%, Realty up by 1.69%, Oil & Gas up by 0.85% and PSU up by 0.21% while, Capital Goods down by 0.92%, Bankex down by 0.88%, Power down by 0.86%, Auto down by 0.85% and TECK down by 0.20% were the losing indices on BSE.

The top gainers on the Sensex were Sesa Sterlite up by 3.44%, ONGC up by 2.67%, Tata Steel up by 2.51%, Sun Pharma Inds. up by 2.30% and Hindalco up by 1.74%. On the flip side, Axis Bank down by 4.75%, BHEL down by 2.76%, Tata Motors down by 2.03%, TCS down by 1.80% and SBI down by 1.77% were the top losers.

Meanwhile, recovering from last month’s fall, the HSBC India Services PMI Business Activity Index-tracking changes in activity at Indian services companies on a month-by-month basis, came at 52.4 in January, up from 51.1 in December, signaling a solid expansion in business activity. It has been above 50 level since May 2014, which denotes growth.

The new business sub-index - which measures demand - climbed to 52.1 from 51.8. The survey also showed firms' confidence regarding future business grew at the fastest pace since June last year. Based on survey responses, the latest increase in activity reflected further growth of new business during the month. Among the monitored sub-sectors, activity rose quickest in ‘Other Services’, while the sharpest reduction occurred in Financial Intermediation. The composite output of the private sector, comprising both manufacturing and services, signaling further growth of private sector output in January, extended the current sequence of expansion to nine months to 53.3 from 52.9. Manufacturing output continued to rise faster than service sector activity at the start of 2015.

Volumes of work-in-hand at Indian service providers increased for the fourth month running in January, while input costs faced by Indian services firms rose for the second straight month in January, having fallen for the first time in more than five-and-a-half years in November. Similarly, private sector input costs increased at the quickest pace since August, contrasting with weaker cost pressures at goods producers. However, despite solid growth of activity and new business, payroll numbers in the Indian service sector rose only fractionally in January. Moreover, the rate of job creation was slower than the historical average. Staffing also increased marginally at goods producers and across the private sector overall.

The most important fact was that the Indian service providers were the most upbeat regarding the 12-month outlook for activity since mid-2014 in January. Private sector new business expanded for ninth straight month and Business sentiment led by anticipated improvements in demand and new commercial initiatives, rose to a seven- month high

The CNX Nifty is currently trading at 8747.30, down by 9.25 points or 0.11% after trading in a range of 8716.40 and 8792.85. There were 23 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were Cairn India up by 4.95%, Sesa Sterlite up by 3.32%, ONGC up by 2.66%, Tata Steel up by 2.53% and Jindal Steel & Power up by 2.14%. On the flip side, Axis Bank down by 4.94%, BHEL down by 2.86%, Zee Entertainment down by 2.49%, Tata Motors down by 2.29% and TCS down by 1.92% were the top losers.

Asian markets were trading mostly higher; with KOSPI Index trading higher by 10.83 points or 0.55% to 1,962.79; Straits Times trading higher by 11.59 points or 0.34% to 3,419.61; FTSE Bursa Malaysia KLCI trading higher by 23.31 points or 1.31% to 1,804.57; Jakarta Composite trading higher by 36.1 points or 0.68% to 5,327.82; Taiwan Weighted trading higher by 65.19 points or 0.69% to 9,513.92; Hang Seng trading higher by 139.99 points or 0.57% to 24,694.77; Nikkei 225 trading higher by 342.89 points or 1.98% to 17,678.74. On the flip side, Shanghai Composite trading lower by 21.5 points or 0.67% to 3,183.41.