Post session - Quick review

Indian barometer gauges after trading listless for most part of the session showcased astonishing move in the final hours to conclude with gains of over half a percentage point. Benchmarks in a very systematic way, gathered gains, as after trading range bound in the first half of the session, bourses lured investor’s attention to risky asset class, to finish near the high point of the day. Clarification of GAAR implication being “non retrospective” and applicable only to “impermissible arrangement”, bought some sense of relief to Indian investors.

Bounce-back came to Dalal Street post two sessions of consolidation, which led to the correction of high beta stocks, thereby making select blue chip stocks as investor’s darling. Benchmark 30 share index -Sensex-after opening above the 17400 level, added over century points to shut shop above 17500, crucial bastion, near to its intra-day high level. While, the widely followed 50 share NSE index- Nifty- rose above 25 points to conclude above the 5300 crucial level. Hopes of availability of cheaper funds after bolder than expected 50 basis points rate cut by RBI, which could spur individual as well business spending yanked the rate sensitive index, pushing Auto index at all-time high level. Stocks of defensive Health Care counter along with Fast Moving Consumer Goods and Information Technology, also stole the limelight. Meanwhile steel stocks like JSW Steel, Tata Steel and SAIL also rose on reports stating likelihood of Steel companies hiking prices for third time in a month.

Overlooking the mixed trend of regional counterparts, bourses preferred borrowing cues from European markets. Asian pacific markets ended mixed Thursday as investors adopted a conservative approach in the run-up to Spain's bond auctions, while the Sydney market outperformed amid growing expectations of further monetary stimulus in China. Meanwhile, European shares rose for the third time in four days as Spain met its target at a bond auction.

Back on home turf, in stocks specific activities, it was new high for IndusInd Bank which posted 30% rise in its Net profit for three month ended March 31,2012, before capitulating to selling pressure. Private sector lender’s core income, rose 19.6% to Rs 464 crore in the fourth quarter against Rs 388 crore in the corresponding quarter a year back. Q4 profit surged more than expected, rising 30% at Rs 223 crore against Rs 171 crore (YoY).

Meanwhile, India's biggest cement company, ACC, after reporting a 55% fall in profit after tax (PAT) at Rs 155.37 crore in the March quarter against Rs 350.66 crore in the corresponding quarter last year (year-on-year), slid over 3.50% to close at Rs 1,246.65. Besides that, stocks from Capital Goods, Power and Oil & Gas too spilled some pessimism. However, the trade remained sideways for broader indices, which finished with gains of over 0.15% each. The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1525:1334 while 113 scrips remained unchanged. (Provisional)

The BSE Sensex gained 136.33 points or 0.78% and settled at 17,528.72. The index touched a high and a low of 17,530.30 and 17,361.71 respectively. 21 stocks advanced against 9 declining ones on the index (Provisional)

The BSE Mid-cap index gained 0.34% while Small-cap index was up by 0.36%. (Provisional)

On the BSE Sectoral front, Auto up 2.32%, Metal up 1.12%, Health Care up 1.10%, FMCG up 1.06% and Bankex up 0.81% were the top gainers while Power down 0.77%, Capital Goods down 0.70%, Oil & Gas down 0.61%, Realty down 0.30% and Consumer Durables down 0.19% were the only losers.

There top gainers on the Sensex were Coal India up 4.15%, Maruti Suzuki up 3.64%, HDFC Bank up 3.18%, Hero MotoCorp up 3.15% and Tata Motors up 2.87% while, BHEL down 3.45%, Hindalco Industries down 1.99%, Gail India down 1.76%, Wipro down 1.32% and RIL down 0.99% were the top losers in the index. (Provisional)

Meanwhile, Telecom Regulatory Authority of India (TRAI) reiterated that licence fee will continue to be non-refundable to mobile service providers if they lose or surrender permits, while adding that a separate exit policy was not required for mobile phone companies who wanted to quit the business. TRAI’s commendations will facilitate the government to save about Rs 10,000 crore, which was paid by the 122 licences that were quashed by the Supreme Court in its February 2, 2012 orders.

The regulator’s recommendations, if accepted, will also result in dismissal of requests from companies like Loop, S Tel and Telenor that had demanded repayment of their licence fee from the government. Unitech Wireless or Uninor, majority owned by Norway’s Telenor, has sought a reimbursement of Rs 1,659 crore paid as licence fee to the government when it acquired mobile permits while Loop wants around Rs 3,800 crore back from licence fee and damages.

Many players are willing to exit the telecom space due to stiff competition and lower profits but are unable to do so. They want clear guidelines on mergers and acquisitions (M&As) and exit policy. But, last month, TRAI had said it was not in favour of an exit policy for telcos since the Supreme Court, on February 2, 2012, had already cancelled all 122 telecommunication licenses issued to various operators in India's 22 service areas under the 2G spectrum sale by the government in January 2008 allegedly at very low prices favoring some companies, and thereby causing a loss of Rs 1.76 trillion (as per Comptroller and Auditor General report) to the exchequer.

But prior to the SC’s orders in February 2, the telecom department had asked the regulator to exercise an exit-policy to allow some operators that had not even started operations, and others who wanted to wind down to exit the sector, as it felt that this was a better option compared to canceling the licences, as recommended by TRAI. While the regulator’s recommendations are not binding on the government, TRAI has restated its suggestions from the draft proposal last month, which advises the government to continue with its present rules that allow a Telco to give up permits by giving a notice of 60 days.

In a separate development, the telecoms secretary R Chandrasekhar said the government was awaiting regulations on spectrum auction by TRAI that would give clarity on the next set of steps to be taken. He added that telcos seeking fresh licences need not wait for the National Telecom Policy, slated to be out by June, and could get permits after guidelines for unified licences are finalised by DoT.

India VIX, a gauge for market’s short term expectation of volatility lost 3.39% at 19.35 from its previous close of 20.03 on Wednesday. (Provisional)

The S&P CNX Nifty gain 38.25 points or 0.72% to settle at 5,338.25. The index touched high and low of 5,342.45 and 5,291.30 respectively. 32 stocks advanced against 18 declining ones on the index. (Provisional)

The top gainers on the Nifty were Coal India up 4.07%, Maruti Suzuki up 3.44%, Kotak Bank up 3.28%, Tata Motors up 3.24% and HDFC Bank up 3.16%.On the other hand, BHEL down 3.89%, ACC down 3.64%, Reliance Infrastructure down 2.20%, JP Associates down 2.13% and Hindalco Industries down 1.95% were the top losers. (Provisional)

The European markets were trading in green, with France's CAC 40 up 0.85%, Germany's DAX up 0.87% and Britain’s FTSE 100 up 0.76%.

After a sharp rally in previous session, Asian equity indices resumed their south-bound journey and most of the Asian counters ended mostly in the red on Thursday as investors remained cautious ahead of a Spanish bond auction later in the global day. With the eurozone debt crisis back in focus, investors are looking to a sale of Spain's benchmark 10-year government bonds later in the day for an indication of market confidence in the under-pressure country. However, the cur remained capped on reports that Chinese central bank would boost liquidity in the nation’s giant economy.

Meanwhile, China shares ended flat on profit-taking after posting its biggest one-day percentage rise in more than two months the previous day. Though, the financial sector found support from news that Chinese authorities would increase liquidity via open market operations and cut banks' required reserves to steer the economy towards a soft landing. However, Japan’s Nikkei average slipped over 0.80 percent, reversing the previous session’s gains as investors avoided risk ahead of a closely watched Spanish bond auction later in the day.