Indian equities trim gain; trade continues in green

Indian equities despite trimming their gains continue to trade in green above neutral line in the late afternoon session as investors have started booking profits in the frontline blue chip counters. Traders were seen piling up position in IT, TECk and Realty while selling was being witnessed in Health Care, Capital Goods and Consumer Durables sector. In the scrip specific development, Maruti Suzuki India and Oriental Bank of Commerce were seen trading weak in red on reporting disappointing Q4 numbers. Bank of India was firm on reporting a whopping 93% Year-on-Year jump in its fourth quarter (Jan-March) net profit at Rs 953 crore, driven by higher interest income and lower operating expenses. Besides, India’s biggest real estate developer DLF rose after Goldman Sachs upgraded its rating on the stock to buy from neutral and raised its 12-month target price. The credit rating firm Moody's has reportedly reviewed three Indian banks ICICI Bank, Axis Bank and HDFC Bank for a potential downgrades. The debt and deposits ratings for all 3 banks remain unchanged. Also, most sugar stocks including Bajaj Hindustan along with shares of textile companies like Arvind, Alok Industries etc traded with notable gains ahead of a meeting called upon by Indian Prime Minister Manmohan Singh to deliberate on the objections raised by Agriculture Minister Sharad Pawar over the export of farm commodities such as sugar and cotton. The stock market will remain closed tomorrow, i.e. on May 01, 2012, on account of Maharashtra Day.

On the global front, all the Asian markets were trading on a mixed note, while the European markets too were trading mixed. The subdued European market weighed on domestic sentiments after reports showed Spain’s economic growth declined 0.3% in the first quarter however, the number was better than expectations of 0.4% decline. On the home turf, the NSE Nifty and BSE Sensex were trading above their psychological 5,200 and 17,200 levels respectively. The market breadth on BSE was positive in the ratio of 1366:1239 while 107 scrips remained unchanged.

The BSE Sensex is currently trading at 17,244.31 up by 56.97 points or 0.33% after trading as high as 17,359.18 and as low as 17,195.51. There were 17 stocks advancing against 13 declines on the index.

The broader indices too were trading in green; the BSE Mid cap index gained 0.10% while Small cap rose 0.32%.

On the BSE sectoral space, IT up 1.73%, TECk up 1.38%, Realty up 0.54%, Oil & Gas up 0.45% and PSU up 0.24% were the major gainers, while Health Care down 0.69%, Capital Goods down 0.28%, Consumer Durables down 0.27%, FMCG down 0.21% and Metal down 0.17% were the only laggards in the space.

TCS up 2.75%, DLF up 2.39%, Infosys up 1.93%, Hero MotoCorp up 1.69% and ICICI Bank up 1.19% were the major gainers on the Sensex, while BHEL down 2.29%, Maruti Suzuki down 2.05%, M&M down 1.15%, Sun Pharma down 1.13% and Sterlite Industries down 1.04% were the major losers in the index.

Meanwhile, Business Confidence of Indian firms have improved marginally in the April-June quarter as compared to the previous Jan-March quarter in 2012. However, businesses remain concerned over stagnant reforms and rising cost of finance and raw materials.

The CII Business Confidence Index for the first quarter of the current fiscal (April-June) stood at 55, as against 52.9 in the last quarter of 2011-12. The reading, however, is lower than the 62.5 for the first quarter of the previous fiscal.

The survey has further revealed that most of the respondents expect GDP growth in 2012-13 to be in the range of 7.0-7.5%, while a few expect it to be higher than 7.5%. Views on inflation remain divergent but all respondents expect it to be in the range of 7-9%. Domestic investments are expected to rise by most respondents (47.2%) and so are international investments. Capacity ulilisation is also expected to improve.

Rising input costs continues to be a major worry for firms. Majority of the firms recorded an increase in electricity/fuel cost and cost of wages and salaries during January-March 2012, while the cost of credit either increased or remained the same as the previous quarter. Expectations for the quarter ending June 2012 show that a majority of firms expect electricity/fuel cost and cost of wages and salaries to increase, while cost of credit is expected to either decline or remain unchanged.

The survey also revealed that stagnancy in reforms is the top concern of most firms, followed by high interest rates and high raw material cost and hence the implementation of a few key reforms in the areas of indirect taxation, pricing of administered products and increasing FDI limits can go a long way in raising business confidence and improving the growth outlook for the economy. This is 79th Business Outlook Survey and is based on a sample size of 200 companies.

The S&P CNX Nifty is currently trading at 5,222.25, higher by 13.25 points or 0.25% after trading as high as 5,262.15 and as low as 5,201.45. There were 26 stocks advancing against 23 declines while 1 stock remained unchanged on the index.

The top gainers on the Nifty were TCS up 2.83%, DLF up 2.41%, Infosys up 2.06%, IDFC up 1.78% and Hero MotoCorp up 1.75%.

Dr Reddy’s down 2.80%, BHEL down 2.44%, Ranbaxy down 1.97%, Maruti Suzuki down 1.96% and Axis Bank down 1.73% were the major losers on the index.

In the Asian space, Hang Seng surged 1.70%, KLSE Composite added 0.34%, Kospi Composite gained 0.34% and Taiwan Weighted rose 0.28%. On the other hand, Jakarta Composite eased 0.08% and Straits Times fell 0.34%.

Meanwhile, stock markets in Japan remained closed on Monday on account of Bridge Public Holiday while the Chinese bourses too were shut owing to May Day holidays and will re-open directly on Wednesday.

The European markets were trading on mix note with, France’s CAC 40 dropped 0.58%, Germany’s DAX rose 0.14% and Britain’s FTSE 100 gain 0.22%.