Weakness widens at Dalal Street; Sensex holds 17500 bastion

Weakness has got more prominent at Dalal Street as funds and retail investors continue to book profits after three consecutive sessions of gains amidst weakening trend on other Asian bourses. The 30-share barometer index of Bombay Stock Exchange (BSE)-Sensex- which gained nearly 540 points in the previous three sessions, despite tanking close to century of points is holding above its 17500 crucial level. Realty, Bankex and Oil & Gas stocks are the notable losers on the BSE sectoral chart, however, stocks from Consumer Durbale, Power and Information Technology are depicting reversal of trend. The broader indices, however, were showcasing mixed trend. Meanwhile, the wide-based National Stock Exchange index- Nifty- too is hovering around the low point of the day.

The bearish trend seen across the globe is mainly perturbing local investor’s. Asian shares fell on Wednesday after the minutes from the U.S. Federal Reserve's March meeting reduced expectations of further stimulus measures to spur growth, leaving investors high and dry global economic outlook. This factor besides playing spook for the US market overnight, also tainted the optimism of rate cut by RBI in its monetary policy review this month. However, the US future indices continued to show a downtick on the screen trade.

Back on the home turf, broadcasting stocks continued to garner traction for the second day on rising expectation of Government hiking FDI cap in broadcasting services to 74%. The Union Cabinet is expected to soon consider a proposal to increase foreign direct investment cap in broadcasting services like Direct-to-Home and cable TV networks to a uniform 74%. Beneficiaries were ENIL, TV Today, Zee New, Zee Entertainment and NDTV.

The BSE Sensex is currently trading at 17,504.33 down by 93.09 points or 0.53%. The index has touched a high and low of 17,553.26 and 17,480.61 respectively.   There were 8 stocks advancing against 22 declines on the index.

The broader indices were depicting mixed trend; the BSE Mid cap index were down by 0.09% and Small cap index gained 0.21%.

The few gaining sectoral indices on the BSE were, CD up by 0.55%, Power up by 0.41%, IT up by 0.15%. While, Realty down by 1.59%, Bankex down by 0.73%, Oil & Gas down by 0.56% and CG down by 0.51% were the top losers on the index.

The top gainers on the Sensex were Tata Power up by 2.42%, Maruti Suzuki up by 1.79%, BHEL up by 1.48%, HeroMoto Corp up by 0.85% and Wipro up by 0.56%.

On the flip side, GAIL India down by 2.66%, Jindal Steel down by 2.11%, ICICI Bank down by 1.84%, DLF down by 1.81% and Cipla down by 1.53% were the top losers on the Sensex.

Meanwhile, India aims to more than double its natural gas pipeline network over the next five years to 30,000 km to cope with the country's booming demand for cleaner energy supplies. The government aims to develop a National Gas Grid by 2017 to take natural gas to different markets across the length and breadth of India.

As per Oil Minister S Jaipal Reddy, the natural gas sector in India is on the verge of a takeoff which is desirable as it is an efficient fuel for power generation, a cheaper feedstock for industries, a cleaner alternative fuel for vehicles. Moreover, it leads to an improvement in the quality of life.

Natural gas consumption in India has grown at 14% a year over the last five years and currently has a network about 12,000 km of gas pipelines with a capacity to transport 230 mmscmd of gas. Right now 12,000 km of additional lines are under construction. 

With the government’s proposal to add another 7000 km, the network will increase to 30,000 km and the capacity will go up to 875 million standard cubic meters per day (mmscmd). This will lead to easier access and will help popularize the use of gas.

Given the fact that the production of domestic gas in India is limited, India is also looking at importing large quantities of liquefied natural gas (LNG). For this purpose it is also pursuing trans-national gas pipelines such as the 1800 km long Turkmenistan-Afghanistan-Pakistan-India (TAPI) Gas Pipeline, in spite of the security hazards and a high threat perception. After more than 18 months of hard negotiations, the four participating countries are close to initializing the Gas Sale Purchase Agreement (GSPA).

The S&P CNX Nifty is currently trading at 5,324.20, lower by 34.30 points or 0.64%. The index has touched a high and low of 5,338.40 and 5,317.90 respectively. There were 9 stocks advancing against 41 declines on the index.

The top gainers of the Nifty were Tata Power up by 1.97%, BHEL up by 1.44%, Maruti Suzuki up by 1.34%, Dr Reddy’s Lab up by 0.92% and RPower up by 0.91%.

On the flip side, GAIL down by 3.04%, Jaiprakash Associates down by 2.65%, DLF down by 2.05%, Jindal Steel down by 2.03% and SAIL down by 2.02% were the major losers on the index.

All the Asian equities were exhibiting the choppy trade; KLSE Composite declined 0.37%, Nikkei 225 plunged 2.12%, Straits Times declined by 0.45%, Seoul Composite plummeted by 1.58%, on the flip side Jakarta Composite down by 1.24%.

Markets in mainland China and Hong Kong remained closed on Wednesday on account of Qingming Festival while the Taiwanese markets were shut owing to Tomb Sweeping Day holiday.