Benchmarks trade firm; Nifty recaptures 4,900 mark

Prolonging its Friday’s up-move, domestic benchmarks are trading with traction, though some profit booking was witnessed in early trade. However, global cues remained mixed as the US markets continued their decline till the last trading day of the week while, most of the Asian equity indices were trading in the positive terrain on the comment of Chinese Premier Wen Jiabao that China will focus more on bolstering economic growth. Back home, sustained buying in mostly all the key heavyweights along with broader indices supported BSE’s -- Sensex -- and NSE’s -- Nifty -- to trade comfortably over their crucial 16,200 and 4,900 mark respectively. However, gains remained capped after Planning Commission deputy chairman Montek Singh Ahluwalia said that ailing rupee and high inflation would make it difficult for India to achieve 7.5 per cent economic growth during the current financial year. On the sectoral front, banking, realty and consumer durables remained the top gainers while there was no loser on the index. Meanwhile, State Bank of India has extended its Friday’s rally post its better than expected quarterly results. The stock is the top gainer among the Sensex stocks, up about 3.50 percent. The broader indices were going neck to neck with benchmarks. The market breadth on the BSE was positive; there were 1,032 shares on the gaining side against 408 shares on the losing side while 55 shares remained unchanged.

The BSE Sensex opened at 16,187.66; about 35 points higher compared to its previous closing of 16,152.75, and has touched a high and a low of 16,284.80 and 16,172.05 respectively.

The index is currently trading at 16,284.80, up by 132.05 points or 0.82%. There were 26 stocks advancing against just 4 declines on the index.

The overall market breadth has made a strong start with 69.03% stocks advancing against 27.29% declines. The broader indices were trading in line with benchmarks; the BSE Mid cap and Small cap indices surged 0.92% and 0.82% respectively.

The top gaining sectoral indices on the BSE were, Bankex up by 1.54%, Realty up by 1.52%, CD up by 1.33%, CG up by 1.31% and Power up by 1.29%. While, there were no losers on the index.

The top gainers on the Sensex were SBI up by 3.36%, DLF up by 2.60%, Maruti Suzuki up by 2.25%, HDFC up by 1.86% and Hindalco up by 1.76%.

On the flip side, Tata Steel was down by 2.09%, Infosys was down by 0.48%, Wipro was down by 0.38% and Bajaj Auto was down by 0.13% were the only losers on the Sensex.

Meanwhile, the final cabinet note on the issue of allowing foreign airlines to buy upto 49% stake in domestic airline has been moved and it is expected that the government will soon take a view on it. It is also believed that the Prime Minister will have consultations with senior ministers to build consensus on the contentious issue before it is presented in front of the cabinet.

So far in India, foreign direct investment (FDI) in the airline industry is permitted but to only those who are not connected with the industry in any way. Foreign airlines are not allowed to invest in Indian airlines. Currently the sector is going through a rough phase with almost all airlines running into losses. Hence the government is looking at options to help the distressed carriers.

The Finance Minister in his budget speech had expressed the government’s intention to allow foreign airlines to participate in the Indian airline industry. However the move could face hurdles if other partners in the UPA coalition decide to oppose it as was seen on the issue of allowing 51% of FDI in multi-brand retail.

The response from the domestic airlines has been mixed. Kingfisher airline which is currently in a debt of Rs 7000 crores is pitching for it strongly whereas Jet Airways and Indigo are opposing the FDI.

The S&P CNX Nifty opened at 4,888.50; about 3 points lower compared to its previous closing of 4,891.45, and has touched a high of 4,933.35 while low remained its opening.

The index is currently trading at 4,927.45, higher by 36.00 points or 0.74%. There were 41 stocks advancing against just 9 declines on the index.

The top gainers of the Nifty were SBI up by 3.52%, Reliance Infra up by 3.25%, DLF up by 2.72%, Tata Power up by 2.64% and Maruti Suzuki up by 2.50%.

On the flip side, Tata Steel down by 2.39%, Wipro down by 0.70%, HCL down by 0.51%, ACC down by 0.47% and Infosys down by 0.45%, were the major losers on the index.

Most of the Asian equity indices were trading in the green; Shanghai Composite gained 7.05 points or 0.30% to 2,351.57, KLSE Composite was marginally up by 0.95 points or 0.06% to 1,533.41, Nikkei 225 added 38.24 points or 0.44% to 8,649.55, KOSPI Composite was up by 13.61 points or 0.76% to 1,796.07 and Taiwan Weighted was trading higher by 54.23 points or 0.76% to 7,205.42.

On the other hand, Hang Seng Index got thrashed by 137.34 points or 0.72% to 18,814.51, Jakarta Composite lost 39.74 points or 1% to 3,940.75 and Straits Times Index lost 2.98 points or 0.11% to 2,776.12.