Barometer gauges slash some loss; power, PSU stocks recover

Succored with the recovery of Power and PSU stocks, barometer gauges have slashed some losses, tracing sanguine European leads, which have spurred some risk taking capacity among jittery investors. Pricing in the weakest GDP figures in nine years, barometer gauges now appear to be showing some signs of recovery. However, pessimistic regional counterparts are continuing to weigh down heavily on the sentiment of Indian equity markets. 30 scrip sensitive index - Sensex, is attempting to reclaim its 16,150 psychological level, while the 50 share index - Nifty, is continuing to swirl around the 4,900 level. The broader indices, on the other hand, have slashed partial losses.

On the global front, recovering their poise after steep losses in the previous session, European shares opened higher on Thursday. On the other hand, fears that Europe’s debt crisis is morphing from Greece to engulf bigger economies such as Spain and Italy have undermined the sentiment of Asian stock markets lower on Thursday. Closer home, stocks from Auto, Consumer Durable and Capital Goods counters are endorsing weakness, but on the other hand recuperation of rupee from day’s low, is buttressing the sentiment, with recovery of PSU stocks, adding to the risk appetite of the investor’s.

The BSE Sensex is currently trading at 16,144.17, lower by 167.98 points or 1.03%. The index has touched a high 16,224.86 and low of 16,086.06 respectively. There were 11 stocks advancing against 19 declines on the index. The overall market breadth on BSE was in the favor of declines in the ratio of 1068:1343, while 127 shares remained unchanged.

The broader indices trimmed some losses; the BSE Mid cap and Small cap indices were down by 0.07% and 0.58% respectively.

The only gaining sectoral index on the BSE was Realty up by 0.21%, Power up by 0.17% and Public Sector Undertaking up by 0.03%. While, Auto down by 2.07%, Consumer Durable (CD) down by 1.34%, Capital Goods (CG) down by 1.26%, Oil & Gas down by 1.16% and Bankex down by 0.99%, were major losers on the index.

The top gainers on the Sensex were Hindalco Industries up by 3.24%, NTPC up by 1.28%, Coal India up by 1.21%, Cipla up by 1.00% and HDFC Bank up by 0.92%.

On the flip side, Tata Motors down by 4.58%, ICICI Bank down by 3.75%, Maruti Suzuki down by 3.50%, RIL down by 2.12% and L&T down by 1.79% were the major losers on the index.

Meanwhile, the economy has grown by a mere 5.3% in the fourth quarter of 2011-12 - lowest quarterly growth rate in 3 years as against 7.8% in the same quarter last year. It is much below the expected number of 6.1% and the major dampening has come in from the manufacturing sector. For the entire year, the GDP growth has now been revised to 6.5%. For the fourth quarter, services grew 7.9% compared to 10.6% last year, farm sector growth fell to 1.7% from 7.5%, manufacturing sector logged negative growth of 0.3% against 7.6%, and construction sector growth fell to 4.8% from 8%.

As stated earlier there has been a downward revision of GDP numbers for FY12. As per the Central Statistics Office (CSO), the downward revision has come in because of the lower performance in manufacturing and 'trade, hotels, transport and communications' than expected.

For 2011-12, the revised GDP growth estimate has taken into account the agricultural growth at 2.8%, higher than the level of 2.5% at the advance estimate stage. The manufacturing sector output is pegged at 2.5%, lower than the 3.9% growth put out at the advance estimate stage. Construction sector is now estimated to have grown 5.3% in 2011-12, higher than 4.8% estimated earlier in February this year.

With the numbers coming in lesser than expected the focus has again shifted towards the RBI’s monetary policy. C Rangarajan, chairman, Prime Minister’s Economic Advisory Council has stated that the RBI shall continue to focus on inflation and may not go in for another rate cut. Some economists on the other hand, feel that inflation probably has now bottomed out and the RBI should focus on reviving growth. Economists are also now less enthusiastic about the GDP numbers of the current fiscal and feel that they will hover around the 6% mark.

The S&P CNX Nifty is currently trading at 4,902.70, lower by 48.05 points or 0.97%. The index has touched a high and low of 4,908.65 and 4,894.45respectively. There were 14 stocks advancing against 36 declines on the index.

The top gainers of the Nifty were Hindalco up by 3.67%, SAIL up by 1.36%, Cipla up by 1.04%, PNB up by 1.02% and Bank of Baroda up by 0.99%. 

On the flip side, Maruti Suzuki was down by 3.73%, Tata Motors down by 2.65%, HCL Technologies down by 1.85%, Sterlite Industries down by 1.52% and Tata Steel down by 1.41% were the major losers on the index.

Some of the Asian indices are showing sign of recovery, but still most of them are reeling in red; Shanghai Composite declined by 0.52%, Jakarta Composite plunged by 2.17%, Hang Seng Index lost 0.32%, Nikkei 225 was down 1.05%, Straits Times was trading lower by 0.24% and KOSPI Composite Index lost 0.08%.

On the other hand, KLSE Composite up by 0.35% and Taiwan Weighted added 0.55%, were the only gainers amongst the Asian pack. 

In Europe, most of the indices have got a green opening, CAC 40 up by 0.72%, DAX was up by 0.40% and FTSE 100 was up by 0.88%.