Weakness persist in markets; automobile stocks rally

The Indian equity markets pared some early losses and trading marginally lower amid volatility as investors taking some profits after the previous sessions strong up move. However, worries about widening fiscal deficit and slowing growth, besides doubts about the pace of US economic recovery on the back of Tuesday's weak economic reports too contributed to the decline. On sectoral front, automobile stocks were finding good support ahead of monthly sales numbers. Consumer durables, bank, realty and information technology stocks were mostly trading weak. On the global front, Asian markets were trading mixed. Back home, the market breadth favoring the positive trend; there were 1,544 shares on the gaining side against 856 shares on the losing side while 97 shares remained unchanged.

The BSE Sensex is currently trading at 17,151.45, down by 42.10 points or 0.24%. The index has touched a high and a low of 17,210.16 and 17,094.07 respectively. There were 13 stocks advancing against 17 declining ones on the index.

Broader indices continue to trade in green; the BSE Mid cap and Small cap indices were up by 0.72% and 1.05% respectively.  

The top gaining sectoral indices on the BSE were, Auto up by 2.25%, CG up by 0.83%, Power up by 0.56%, Metal up by 0.47% and Health Care up by 0.32%. While, CD down by 1.07%, IT down by 0.91%,TECk down by 0.85%, Bankex down by 0.76% and Realty down by 0.63% were the top losers on the index.

The top gainers on the Sensex were MotoCorp up by 3.82%, Tata Power up by 3.66%, M&M up by 3.54%, Jindal Steel up by 2.69% and Maruti Suzuki up by 2.23%.

On the flip side, Coal India down by 2.12%, ONGC down by 2.07%, HDFC down by 1.97%, ICICI Bank down by 1.78% and DLF down by 1.53% were the top losers on the index.

Meanwhile, in a bid to deal with the unfavorable global economic situation, Prime Minister Manmohan Singh has announced a whooping investment of Rs 140,000 crore by 17 blue chip government undertakings in the approaching financial year (2012-13). Appreciating the role of the public sector in the development of the economy, Manmohan said that the role of public investment assumed greater importance at a time when the country was facing a difficult global environment and looking at domestic drivers to propel growth.

The prime minister said that 17 central public sector undertakings (CPSUs) had committed to an investment plan amounting to Rs 140,000 crore in the next financial year and encouraged other CPSUs to similarly ‘pay attention to boosting capital investment’ and increase their turnover to stave off the adverse global impact on the economy.

He further hoped that the private sector would work together with the public sector and invest huge amounts, especially in infrastructure. By adding he said, that even though the turnover of PSUs in the manufacturing and mining sectors had taken a beating in the last fiscal, they should step up their performance especially in mining, production of coal, petroleum and natural gas.

On acquisition of raw material assets abroad, he said the CPSUs should take advantage of the policy, which was recently approved by the cabinet, and also urged CPSUs, especially those in the field of the mining, to seriously explore opportunities for such acquisitions.

Expressing dissatisfaction on the performance of the manufacturing sector, Singh said the share of the manufacturing sector at 15% of the current GDP, was unacceptable. He said that CPSUs had a significant presence in areas such as machine tools, heavy transport, earth moving and mining equipment, shipbuilding, defense equipment, aerospace, heavy electrical equipment and nuclear power generation and they must take up ambitious plans of expansion to make the target of 12 to 14 % growth in manufacturing a reality. He further asserted that his government was willing to do whatever it took to make the CPSEs stronger and more competitive.

The S&P CNX Nifty is currently trading at 5,183.45, down by 15.80 points or 0.30%. The index has touched a high and a low of 5,198.35 and 5,167.80 respectively. There were 26 stocks advancing against 23 declining ones and one remained unchanged on the index.

The top gainers of the Nifty were Tata Power up by 3.80%, Hero MotoCorp up by 3.75%, M&M up by 3.52%, Jindal Steel up by 2.85% and Maruti Suzuki up by 2.44%.

Coal India down by 2.51%, BPCL down by 2.44%, ONGC down by 2.23%, Sesa Goa down by 2.04% and HDFC down by 1.88% were the major losers on the index.

Most of the Asian equity indices were trading mixed; Hang Seng inched up by 0.16%, Jakarta Composite added 0.25%, Taiwan Weighted gained 0.43%, Nikkei 225 surged by 0.14%, and Seoul Composite was up by 0.21%. On the flipside, Shanghai Composite tumbled 0.23% and Straits Times shed 0.38%.