Benchmarks trade positive after a cautious start

The Indian equity markets are trading in the positive terrain after a cautious start supported by sustained buying by foreign funds over the past few days. However, the Asian stock markets were trading mostly lower as talks to prevent Greece from going belly up dragged on amid divisions over how to cut the country’s debt further and impose even tighter control over its spending. Moreover, the US markets were closed overnight for President’s Day holiday. Traders are looking for signs of economic recovery in the world’s No. 1 economy on February 22, 2012, when the National Association of Realtors releases existing home sales for January. On the domestic front, telecom stocks like Idea Cellular, Tata Communication and Reliance Communication were edged higher after TRAI issued draft guidelines for the sale and allocation of mobile phone frequency. The new TRAI policy aims at simplifying licensing rules, providing greater transparency, and encouraging mergers and acquisitions. Capital Goods witnessed the maximum gain in trade followed by realty and power while, consumer durables, software and technology remained the top losers on the index on the BSE sectoral space. The broader indices were outperforming benchmarks. The market breadth on the BSE was positive; there were 1,129 shares on the gaining side against 645 shares on the losing side while 87 shares remained unchanged.

The BSE Sensex opened at 18,303.73; about 14 points higher compared to its previous closing of 18,289.35, and has touched a high and a low of 18,414.11 and 18,293.80 respectively.

The index is currently trading at 18,357.65, up by 68.30 points or 0.37%. There were 20 stocks advancing against 10 declines on the index.

The overall market breadth has made a strong start with 60.67% stocks advancing against 34.66% declines. The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices surged 0.38% and 0.60% respectively.

The top gaining sectoral indices on the BSE were, CG up by 1.50%, Realty up by 1.28%, Power up by 0.98%, Metal up by 0.75% and FMCG up by 0.67%. While, CD down by 1.70%, IT down by 0.75%, TECk down by 0.60% and Auto down by 0.20% were the only losers on the index.

The top gainers on the Sensex were BHEL up by 4.22%, Tata Steel up by 2.57%, ONGC up by 2.24%, SBI up by 1.58% and Hero MotoCorp up by 1.44%.

On the flip side, Sterlite Industries was down by 1.62%, TCS was down by 1.52%, M&M was down by 0.91%, Tata Motors was down by 0.66% and Infosys was down by 0.65% were the top losers on the Sensex.

Meanwhile, the government has proposed setting up of a specialised body to promote sustainable development of the Indian auto sector called the National Automotive Board (NAB). The body which is expected to be set up by April 2012, will succeed the National Automotive Testing and R&D Infrastructure Project (NATRIP). It is being set up with a view to facilitate communication between the government and the industry, promote research and development activities and have a larger role in developing skills for the growing automobile sector. Besides, it is also expected to act as a think-tank for the government, especially for the growth of hybrid and electric vehicles in the country.

The proposal for setting up the board is being finalised by the Department of Heavy Industry and is likely to be cleared by the Cabinet in a month. The board will have members from the Department of Heavy Industry, Planning Commission and from various ministries, including Road Transport and Highways, Science and Technology, Environment and Forests. It would also include scientists and industry representatives.

NAB is expected to succeed NATRIP, which was formed to set up new auto testing and R&D centres along with upgrading the existing ones. It was set up for upgradation of three existing automotive testing and R&D centres -- the Vehicle Research and Development Establishment (VRDE) at Ahmednagar, Automotive Research Association of India (ARAI) at Pune and International Centre for Automotive Technology (ICAT) at Manesar. In addition, NATRIP's mandate was to set up four greenfield centres at Chennai, Indore, Silchar and Rae Bareilly for automotive testing, homologation and R&D. As per government officials, these centres are now established and some of them have been upgraded and therefore the role of NATRIP has been completed.

The S&P CNX Nifty opened at 5,561.90; about 3 points lower compared to its previous closing of 5,564.30, and has touched a high and a low of 5,601.45 and 5,561.75 respectively.

The index is currently trading at 5,586.60, higher by 22.30 points or 0.40%. There were 33 stocks advancing against 17 declines on the index.

The top gainers of the Nifty were BHEL up by 4.10%, Tata Steel up by 2.63%, ONGC up by 2.33%, SBI up by 1.61% and Hero MotoCorp up by 1.60%.

BPCL down by 2.02%, Sterlite Industries down by 1.84%, TCS down by 1.53%, IDFC down by 1.49% and HCL Tech down by 0.97%, were the major losers on the index.

Most of the Asian equity indices were trading in the red; Shanghai Composite was down 8.86 points or 0.37% to 2,354.74, Hang Seng was down 100.80 points or 0.47% to 21,323.99, KLSE Composite was down 0.98 points or 0.06% to 1,559.59, Nikkei 225 was down 38.15 points or 0.40% to 9,446.94, Straits Times was down 2.74 points or 0.09% to 3,018.45, Seoul Composite was down 15.91 points or 0.79% to 2,008.99 and Taiwan Weighted was down by 54.76 points or 0.69% to 7,900.06.

On the flip side, Jakarta Composite was up by 20.34 points or 0.51% to 4,000.59.