Benchmarks edge lower after smart recovery ahead of fiscal year-end

Following sharp fall the Indian equity markets regained significant portions of lost ground in the early morning session, but currently edging lower again due to lack of support at higher levels. Investors were trading cautiously ahead of financial year ending 2011-12 due to worries about foreign selling on the back of the uncertainty over the taxation for participatory notes, which are popular derivative instruments through which many overseas investors buy into Indian equities.  As a result of which foreign investors have reduced their net purchases of Indian stocks this week. On the sectoral front banking stocks were trading in red on portfolio positioning by institutional investors ahead of the end of the fiscal year this week. Capital goods, healthcare, FMCG stocks were finding some support. Metal, information technology, bank and realty stocks were off their lows, but are still mostly trading in negative territory. On the global front, Asian markets edged lower following a slip on Wall Street and on profit-taking after the previous day's strong showing. Back home, the market breadth favoring the negative trend; there were 967 shares on the gaining side against 1,498 shares on the losing side while 138 shares remained unchanged.

The BSE Sensex is currently trading at 17,180.74, down by 76.62 points or 0.44%. The index has touched a high and low of 17,245.82 and 17,135.76 respectively. There were 8 stocks advancing against 22 declines on the index.

The broader indices too were trading in the red; the BSE Mid cap and small cap indices declined 0.32% and 0.34% respectively.

The top gaining sectoral index on the BSE were HC up by 0.36%, CG up by 0.31% and FMCG up by 0.26. While, CD down by 2.78%, Realty down by 1.19%, Bankex down by 0.89%, Metal down by 0.80% and TECk down 0.64% were the top losers on the index.

The top gainers on the Sensex were Tata Power up by 1.25%, Gail India up by 0.90%, L&T up by 0.53%, Tata Steel up by 0.45% and Maruti Suzuki up by 0.18%.

On the flip side, Hindalco Industries down by 1.86%, Sterlite Industries down by 1.83%, NTPC down by 1.40%, Bajaj Auto down by 1.34% and Jindal Steel down by 1.23% were the top losers on the Sensex.

Meanwhile, Finance Minister, Pranab Mukherjee has agreed to reconsider the issue of excise duty on unbranded jewellery and to come up with an ‘acceptable solution’. He has however categorically ruled out the possibility of a roll back on the increase in import duty of gold and platinum.

Jewellers in Maharashtra and Gujarat went on strike after the FM imposed a 1% excise duty on unbranded jewellery. The strike entered its 11th day on March 27. With no sign of the industry softening in its stance the FM has agreed to look into the matter and come with an acceptable solution. He has also stated that harassing the small jewelers was not his intention.

He has however denied the possibility of a roll back of the hike in excise duty on gold and platinum. The FM in the Union Budget 2012-13 has hiked the import duty on these precious metals from 2% to 4%. This has been justified on the stance that gold imports have seen a recent surge in their imports to the extent that they are second only to the oil imports. Since investments in gold are considered to be a dead investment, the FM has hiked the duty to discourage the same.

India is the world's biggest consumer of the yellow metal, with an annual consumption of over 900 tonnes. The country imported gold worth $46 billion last fiscal, nearly equivalent to its current account deficit, prompting policymakers to call for measures to curb its import.

The S&P CNX Nifty is currently trading at 5,217.35, lower by 25.80 points or 0.49%. The index has touched a high and a low of 5,236.55 and 5,201.70 respectively. There were 15 stocks advancing against 35 declines on the index.

The top gainers of the Nifty were Dr Reddy up by 1.67%, Tata Power up by 1.25%, GAIL up by 1.03%, L&T up by 0.82% and Tata Steel up by 0.55%.

On the flip side, JP Associates down by 2.34%, Cairn down by 2.25%, Sesa Goa down by 1.94%, Hindalco down by 1.78% and Sterlite Industries down by 1.65% were the major losers on the index.

Most of the Asian equity indices were trading in the red; Shanghai Composite declined 1.73%, Hang Seng slid 1.08%, Jakarta Composite shed 0.19%, KLSE Composite surrendered 0.10%, Nikkei 225 plunged 0.71%, Straits Times was down by 0.52% and Seoul Composite edged lower by 0.39%.

On the flip side, Taiwan Weighted up by 0.11% was the lone loser amongst the Asian pack.