Markets trade flat with bit of negative bias ahead of F&O expiry

After a mildly positive close in previous session, Indian equity markets made a negative start and are now trading with marginal losses, as investors remained on the sidelines and refrained from any major buying activity ahead of the expiry of January derivative contracts later today. The sentiments were further weighed down by Indian rupee, which depreciated 14 paise to hit its fresh 29-month low at 68.19 against the American currency as dollar demand from banks and importers rose at interbank foreign exchange market. Meanwhile, foreign institutional investors were net sellers in equities to the tune of Rs 367 crore on Wednesday, as per provisional stock exchange data.  However, some support came in with the statement of S Iswaran, Minister of Trade and Industry, Singaporean that India is projected to be the world's fastest growing major economy this year. It was the world's top FDI (Foreign Direct Investment) destination in the first half of 2015 with $ 31 billion greenfield investment. On the sectoral front, traders were seen piling up position in Power, FMCG, Oil & Gas, IT and PSU, while selling was witnessed in Metal, Bankex, Realty, Capital Goods and Auto on the BSE.

In the scrip specific development, SpiceJet surged 6% to Rs 95.30, its highest level since January 2008 on the BSE, after the foreign institutional investor (FII) bought just over 0.5% stake in the low-cost airline through the open market.

On the global front, US markets ended lower after the Federal Reserve held interest rates steady at its January monetary policy meeting, while offering little direction on the timing of its next hike. Asian markets were trading mostly in green as an overnight rebound in the oil price offset a cautious tone from the Federal Reserve about volatility in financial markets.

Back home, the NSE Nifty and BSE Sensex were trading above the psychological 7,400 and 24,450 levels respectively The market breadth on BSE was positive in the ratio of 940: 563 while 99 scrips remained unchanged.

The BSE Sensex is currently trading at 24478.75, down by 13.64 points or 0.06% after trading in a range of 24400.52 and 24529.64. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.16%, while Small cap index was up by 0.14%.

The top gaining sectoral indices on the BSE were Power up by 0.65%, FMCG up by 0.46%, Oil & Gas up by 0.23%, IT up by 0.21% and PSU up by 0.11%, while Metal down by 0.52%, Bankex down by 0.39%, Realty down by 0.17%, Capital Goods down by 0.15% and Auto down by 0.09% were the losing indices on BSE.

The top gainers on the Sensex were Adani Ports &SEZ up by 1.14%, Dr. Reddys Lab up by 0.94%, ITC up by 0.74%, Mahindra & Mahindra up by 0.72% and Sun Pharma Inds. up by 0.56%. On the flip side, Bharti Airtel down by 2.00%, HDFC down by 1.34%, Tata Steel down by 1.22%, Maruti Suzuki down by 1.22% and ICICI Bank down by 0.99% were the top losers.

Meanwhile, the Telecom Regulatory Authority of India (TRAI) has recommended the base spectrum pricing for seven bands in the next round of auctions, including the 700 MHz spectrum. The new round of auction could fetch the government a staggering Rs 5.36 lakh crore, of which the premium 700 MHz band spectrum could alone contribute over Rs 4 lakh crore if all of this frequency were to be sold at the pan-India reserve price of Rs 11,485 crore per MHz. The last auction held in March 2015 had fetched the government record bids worth over Rs 1.1 lakh crore.

The regulator for the first time recommended auction of the premium 700 MHz spectrum in the country despite leading telcos asking the regulator to hold back the sale of radio waves in this band. The 700 MHz spectrum is considered the most efficient frequency for high-end mobile services. According to the Trai paper, the cost of delivering mobile services in the 700 MHz band is approximately 70 per cent lower than the 2,100 MHz band, which is widely used for 3G services.

For 3G spectrum in 2100 band, Trai suggested pan-India base price of Rs 3,746 crore against Rs 3,705 crore per MHz fixed by the government for the same in March 2015 auctions, which could be the second largest contributor attracting bids of about Rs 63,000 crore.

TRAI also recommended a base price of Rs 2,873 crore per MHz for pan-India 1,800 MHz frequency band-widely known as 2G spectrum. The suggested price of 1,800 MHz band is about 31 per cent higher than the base price fixed by the government for the March 2015 auctions. On spectrum held by the defence ministry, it further added that if defence shifts to the designated defence band and its assignment in all the circle is restricted to maximum 20 MHz, around 201 MHz additional spectrum can be made available for commercial purpose in 1800 Mhz band.

The CNX Nifty is currently trading at 7433.05, down by 4.70 points or 0.06% after trading in a range of 7409.60 and 7446.80. There were 27 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were Cairn India up by 2.61%, Power Grid Corpn. up by 2.24%,  Adani Ports & SEZ up by 1.23%,  Zee Entertainment up by 1.22% and Mahindra & Mahindra up by 0.81%. On the flip side, Bharti Airtel down by 1.98%, HDFC down by 1.40%, Idea Cellular down by 1.37%, Maruti Suzuki down by 1.35% and Tata Steel down by 1.16% were the top losers.

Asian markets were trading mostly in green, KOSPI Index increased 1.84 points or 0.1% to 1,899.71, FTSE Bursa Malaysia KLCI increased 2.83 points or 0.17% to 1,634.37, Jakarta Composite increased 9.8 points or 0.21% to 4,593.43, Hang Seng increased 32.42 points or 0.17% to 19,084.87, Nikkei 225 increased 36.97 points or 0.22% to 17,200.89 and Taiwan Weighted increased 53.89 points or 0.69% to 7,903.72

On the flip side, Shanghai Composite decreased 13.01 points or 0.48% to 2,722.55.