Indian equities trim losses; Sensex above 17,700 mark

Indian equities trim losses but continue its lackluster trade below the neutral line in the late afternoon session as wary investors remained on the sidelines in the absence of any significant positive triggers. Traders were seen piling up the positions in Realty, Auto and Consumer Durables sector while selling was witnessed in Oil & Gas, Capital Goods and FMCG sector. Meanwhile, global rating agency Fitch has affirmed that India is facing cyclical slowdown rather than a structural downturn. Fitch stated that this may further ease inflation, which appears to have passed its peak and thereby giving room to RBI to move to a more accommodative monetary policy, after recent increases in policy rates. IT sector stocks too are under mild pressure after industry body NASSCOM opined that exports from India's information technology sector are set to grow more slowly for the year ending March 31, 2013. Industry heavyweight RIL is trading in red with the stock snapping two-day gains exerting pressure on the markets. Bharti Airtel continued its yesterday fall triggered by weak Q3 results. However, all the eyes are set on the forthcoming budget. Finance Minister Pranab Mukherjee will present the annual budget for 2012/13 on March 16, 2012, while the railways budget will be presented on March 14, 2012. The budget session of parliament will start on March 12, 2012. On the global front, the Asian markets were trading on a mix note while the European markets were trading in green on an optimistic note. The Greece Prime Minister Lucas Papademos has summoned the nation's international lenders for further discussions today, February 09, 2012, after failing to get a full agreement from his coalition supporters on economic measures. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 5,350 and 17,700 levels respectively. The market breadth on BSE was in favor of advances in the ratio of 1619:1120 while 108 scrips remained unchanged.

The BSE Sensex is currently trading at 17,702.20 down by 5.12 points or 0.03% after trading as high as 17,705.58 and as low as 17,609.43. There were 17 stocks advancing against 13 declines on the index.

The broader indices were trading on a positive note; the BSE Mid cap index climbed 0.77% while Small cap rose 0.84%.

On the BSE sectoral space, Realty up 1.28%, Auto up 1.22%, Consumer Durables up 1.06%, Power up 0.79% and Bankex up 0.70% were the major gainers while Oil & Gas down 0.61%, Capital Goods down 0.25%, FMCG down 0.06%, Health Care down 0.04% and Metal down 0.01% were the only losers in the space.

Bajaj Auto up 2.39%, Jindal Steel up 1.89%, Tata Motors up 1.72%, HDFC Bank up 1.67% and NTPC up 1.58% were the major gainers on the Sensex, while Hindalco Industries down 4.66%, Bharti Airtel down 2.01%, DLF down 1.55%, ONGC down 1.50%, and Tata Steel down 1.35% were the top losers in the index.

Meanwhile, exports continued to grow, but on a moderate basis by about 10.1% y-o-y in January 2012 to $25.4 billion, while imports increased by 20.3% at $40.1 billion widening India's trade deficit to $14.7 billion in January 2012 as against $12.8 billion in December 2011.

Commerce Secretary, Rahul Khullar, citing provisional data, has said that Indian exports which stood at $25 billion in December 2011 and have grown to $25.4 billion in January 2012. Imports are up from $37.7 billion in December 2011 to $40.1 billion in January 2012.

Cumulative exports for the period April- January reached $242.8 billion.  Imports on the other hand grew by 29.4% to $391.5 billion during the April-January period. The trade deficit stood at $ 148.7 billion for the period.

Khullar further stated that though India’s trade deficit has increased in January 2012, it is not a worrisome number and can be expected to narrow down over the next two months. India's exports for the fiscal year through March are expected to be between $295 billion and $305 billion with imports totaling $460 billion, while the trade gap is seen around $160 billion in FY12.

The S&P CNX Nifty is currently trading at 5,360.35, lower by 7.80 points or 0.15% after trading as high as 5,369.25 and as low as 5,338.90. There were 28 stocks advancing against 22 declines on the index.

The top gainers on the Nifty were Cairn India up 2.56%, Reliance Power up 2.41%, Bajaj Auto up 2.28%, Tata Motors up 1.90% and Siemens up 1.82%.

Hindalco down 4.85%, Bharti Airtel down 2.42%, DLF down 2.27%, IDFC down 2.09% and ONGC down 1.84% were the major losers on the index.

In the Asian space, Hang Seng eased 0.04%, Jakarta Composite declined 0.60%, Straits Times dropped 0.29% and Nikkei 225 shed 0.15%. On the flipside, Seoul Composite climbed 0.54%, Shanghai Composite added 0.09% and Taiwan Weighted advanced 0.52%.

The European markets were trading in green with, France’s CAC 40 ascended 0.65%, Germany’s DAX added 0.83% and Britain’s FTSE 100 jumped 0.43%.