Benchmarks turn negative in early trade

The Indian equity markets have made the positive start but, slipped into the red as participants engaged in profit-booking amid concerns that rising crude prices in global markets could revive inflation worries. Globally, US markets made a flat closing on Friday despite good report of consumer confidence and retail sales while; Asian peers were trading on a mixed note at this point of time. Back home, Sesa Goa, the largest iron-ore exporter in India, will absorb Sterlite Industries India in an all-share deal. Investors will get three Sesa Goa shares for five shares of Sterlite. Vedanta will transfer its 38.8% holding in Cairn India, including a debt of $5.9 billion, to the combined entity Sesa Sterlite. On the sectoral front, fast moving consumer goods and oil and gas remained the only gainers while, realty, capital goods and auto remained the top losers on the BSE sectoral space. The broader indices too were struggling to get some traction while, the market breadth has made a negative start; there were 518 shares on the gaining side against 977 shares on the losing side while 40 shares remained unchanged.

The BSE Sensex opened at 17,975.19; about 52 points higher compared to its previous closing of 17,923.57, and has touched a low of 17,789.96 while high remain its opening.

The index is currently trading at 17,800.08, down by 12.49 points or 0.69%. There were 9 stocks advancing against 21 declines on the index.

The overall market breadth has made a negative start with 33.75% stocks advancing against 63.65% declines. The broader indices too were bleeding badly; the BSE Mid cap index was down by 1.41% while, Small cap index was up by 0.92%. 

The only gaining sectoral indices on the BSE were, FMCG up by 0.75% and Oil and Gas up by 0.16%. While, Realty down by 2.97%, CG down by 2.57%, Auto down by 1.85%, CD down by 1.84% and Power down by 1.80% were the top losers on the index.

The top gainers on the Sensex were Sterlite Industries up by 1.47%, ONGC up by 1.14%, ITC up by 0.95%, Sun Pharma up by 0.83% and HUL up by 0.55%.

On the flip side, Hero MotoCorp down by 3.00%, L&T down by 3.00%, DLF down by 2.73%, BHEL down by 2.47% and Maruti Suzuki down by 2.42% were the top losers on the index.

Meanwhile, the government has notified exports of additional one million tonnes of sugar on Friday. The notification has come after a panel of ministers headed by Finance Minister, Pranab Mukherjee on February 7, had conceded the demand made by sugar manufacturers to allow greater exports of sugar in view of the expected increase in its production.

As per the notification, the export quota will be allocated among sugar mills based on their average production of last three years. Mills can export sugar from their own production or they can source the sweetener from other factories to minimise transportation cost. However, a brand new sugar factory which has started this year will not have any export entitlement. The refineries which are producing refined sugar from raw sugar will also not have any export entitlement.

The Ministry has given 45 days to sugar mills to apply for export release orders, which will be valid for 60 days with a warning that no further extension of time period will be permitted for submission of application beyond the stipulated period. If not utilized, quota of the concerned mills will stand lapsed.

Sugar production in India, the world’s second biggest producer and the largest consumer, is estimated to outstrip annual demand of 22 million tonnes this year. The government has pegged sugar output at 24.5 million tonnes for 2011-12 marketing year, while the industry body ISMA (Indian Mills Sugar Assosiation) expects it to be 26 million tonnes. In 2010-11 marketing year (October-September), the country had exported 2.6 million tonnes of sugar.

The S&P CNX Nifty opened at 5,429.30; about 19 points higher compared to its previous closing of 5,448.10, and has touched a high and a low of 5,449.80 and 5,383.95 respectively.

The index is currently trading at 5,387.00, down by 42.30 points or 0.78%. There were 15 stocks advancing against 35 declines on the index.

The top gainers of the Nifty were BPCL up by 3.22%, Sterlite Industries up by 1.48%, Cairn up by 1.35%, ITC up by 1.15% and HCL Tech up by 0.93%.

Sesa Goa down by 6.44%, Axis Bank down by 3.69%, IDFC down by 3.34%, Reliance Infra by 3.13% and Hero MotoCorp down by 3.02%, were the major losers on the index.

Asian equity indices were trading mixed; Shanghai Composite was up 17.87 points or 0.73% to 2,457.50, Hang Seng was up 56.05 points or 0.26% to 21,462.91, KLSE Composite was up 2.81 points or 0.18% to 1,561.58 and Nikkei 225 was up 58.92 points or 0.61% to 9,706.30.

On the flip side, Jakarta Composite was down 34.12 points or 0.88% to 3,860.45, Straits Times was down 8.75 points or 0.29% to 2,969.33 and Seoul Composite was down by 23.06 points or 1.14% to 1,996.83. 

However, stock markets in Taiwan remained closed on Monday on account of Peace Memorial Day holiday.