Indian equities continue to trade under pressure in the late afternoon session

Indian equities continued its weak trade in red in the late afternoon session on account of selling in frontline blue chip counters. Selling pressure in local markets got aggravated after the negative opening for European markets which extended their declining momentum for third straight session on growing worries over global economic slowdown. The market may remain volatile during the course of the trading session as traders roll over positions from the near-month to next month series ahead of the expiry. The March 2012 derivatives contract expires today i.e. on March 29, 2012. Also, uncertainties about capital inflows caused by proposed changes in tax laws continued to weigh on sentiment. Traders were seen piling up position in Health Care sector while selling was witnessed in Capital Goods, FMCG and TECk sector. Also on reports that India's core sector industries' output grew 6.8% year on year in February, too failed to prop-up sentiments. Industry heavyweight RIL was seen trading weak in red exerting pressure on the markets. Anil Dhirubhai Ambani (ADA) Group companies like Reliance Communications, Reliance Infrastructure and Reliance Power were seen trading weak in red.

On the global front, Asian markets were trading in red barring KLSE Composite while the European markets were too trading in red on pessimistic note. On the home turf, the NSE Nifty and BSE Sensex were trading below their psychological 5,200 and 17,000 levels respectively. The market breadth on BSE was in favor of declines in the ratio of 1220:1407 while 114 scrips remained unchanged.

The BSE Sensex is currently trading at 16,951.08 down by 170.54 points or 1.00% after trading as high as 17,045.76 and as low as 16,920.61. There were 5 stocks advancing against 25 declines on the index.

The broader indices were trading on a mixed note; the BSE Mid cap index slipped 0.31% while Small cap gained 0.22%.

On the BSE sectoral space, Health Care up 0.08% was the sole gainer, while Capital Goods down 1.50%, FMCG down 1.26%, TECk down 1.19%, IT down 1.18% and Power down 1.11% were the major losers in the space.

Jindal Steel up 1.30%, Coal India up 1.01%, Hero MotoCorp up 0.95%, Tata Power up 0.52% and Gail India up 0.14% were the only gainers on the Sensex, while BHEL down 1.80%, Bharti Airtel down 1.65%, Sun Pharma down 1.50%, L&T down 1.46% and TCS down 1.44% were the major losers in the index.

Meanwhile, India is expected to grow rapidly in the next 40 years and be the world’s largest economy by 2050, as per the Wealth Report by Knight Frank & Citi Private Bank. China will overtake the US to become the world's largest economy by 2020, which in turn will be overtaken by India in 2050.  The focal point of global economic activity based on GDP, will shift eastwards to lie somewhere between China and India. India with its GDP of $3.92 trillion currently ranks 4th in the world. It is expected to grow at an average rate of 8% from 2010-2050 and shall grab the top spot by 2050 with a GDP of $85.97 trillion. However, in terms of per capita income, India does not figure in the top 10 nations of the world.

Citi forecasts that the North American and Western European share of world real GDP will fall from 41% in 2010 to just 18% in 2050. Developing Asia’s share is expected to rise from 27% to 49% in 2050. It also confirms the relentless shift in wealth distribution towards Asia-Pacific:  the region covering China, SE Asia and Japan now has more centa-millionaires (those with over $100 million in assets) than North America or Western Europe. The greatest threat to India’s wealth shall be its inflation levels.

As per the report, the cities to watch in 2050 are the 400 emerging market 'middleweights' - fast growing cities with populations between 200,000 and 10 million. This dynamic group includes cities of Surat and Nagpur in India. Mumbai and New Delhi will also be amongst the top 20 fastest growing cities globally.

Reporting about India’s property market, the report states that the Indian government has not had to resort to specific cooling measures to check the growth of its burgeoning prime residential markets. Weak economic conditions and high inflation, with a concomitant decision by the Reserve Bank to raise interest rates 13 separate times in 2011, contributed to prices in Mumbai falling by more than 18% last year. India’s prime market is unusually vulnerable to internal economic events because of the country’s strict limits on foreign buyers. This removes the potential safety net provided by inward capital flows from overseas buyers.

There were some other interesting facts brought out in the report. Indians believe that good public transport, safety and strong governance make a global city. Surprisingly, ‘the view ‘is the most important element while selecting a second house, for the Indians. Indians term offices, preferably pre-let to multinational corporations as top commercial investments and their favourite things are gadgets and cars.

Knight Frank India is a company that provides a comprehensive range of real estate related services covering residential, commercial, land, investments, hospitality & leisure, valuation, advisory services, facilities management and project management. Citi, is a leading global financial services company, and has approximately 200 million customer accounts and does business in more than 160 countries and jurisdictions, including India.

The S&P CNX Nifty is currently trading at 5,152.00, lower by 42.75 points or 0.82% after trading as high as 5,167.90 and as low as 5,135.95. There were 11 stocks advancing against 39 declines on the index.

The top gainers on the Nifty were Ranbaxy up 4.33%, Hero MotoCorp up 1.94%, Kotak Bank up 1.62%, Jindal Steel up 1.42% and Coal India up 1.24%.

Cairn India down 3.80%, Siemens down 2.35%, Reliance Communications down 2.19%, Reliance Infrastructure down 1.82% and Bharti Airtel down 1.82% were the major losers on the index.

In the Asian space, Shanghai Composite plunged 1.43%, Hang Seng plummeted 1.32%, Jakarta Composite eased 0.01%, Nikkei 225 declined 0.67%, Straits Times dropped 0.64%, Seoul Composite slipped 0.85% and Taiwan Weighted nosedived 2.06%. On the other hand only, KLSE Composite gained 0.06%.

The European markets were trading in red as France’s CAC 40 eased 0.14%, Germany’s DAX fell 0.40% and Britain’s FTSE 100 dropped 0.35%.