Indian equities gain strength to trade in green

Indian equities trim losses to continue its firm trade in green in the late afternoon session as investors started piling up fresh positions after mirroring the European counterparts. Investors were optimistic over last week's series of unanticipated new measures to resolve the onerous financial trouble in the Euro-zone. Traders were seen piling up position in Realty, Consumer Durables and Metal sector while selling was witnessed in Auto, IT and Oil & Gas sector. DLF from Realty counter was seen trading in green with gain of around more than three percent pulling the markets higher. Tata Steel, Sterlite Industries, SAIL and Hindalco Industries from Metal pack were trading in green pushing the markets higher. Industry heavyweight RIL was trading in green giving the much needed support.  In the scrip specific development, three aviation companies Jet Airways, Kingfisher Airlines and Spicejet were seen trading firm as state-run oil marketing companies reduced prices of aviation turbine fuel by 2% effective from July 01, 2012. Hectic activity was noticed in Auto stocks like Maruti Suzuki, M&M, Tata Motors, Bajaj Auto and TVS Motor Company on reporting monthly sales numbers.

On the global front, the Asian markets were trading in green barring Nikkei 225 and KOSPI Composite Index while the European markets were too trading in green on optimistic note. The European Central Bank (ECB) is scheduled for a policy meeting on interest rates on Thursday i.e. July 05, 2012 and is expected to cut its benchmark rate by 25 basis points from 1% to an all time low of 0.75%. On the home turf, the NSE Nifty and BSE Sensex were trading above their psychological 5,250 and 17,400 levels respectively. The market breadth on BSE was positive in the ratio of 1654:992 while 115 scrips remained unchanged.

The BSE Sensex is currently trading at 17,448.47 up by 18.49 points or 0.11% after trading as high as 17,464.47 and as low as 17,363.04. There were 16 stocks advancing against 14 declines on the index.

The broader indices were trading on a positive note; the BSE Mid cap index advanced 0.86% while Small cap index climbed 1.09%.

On the BSE sectoral space, Realty up 1.81%, Consumer Durables up 1.31%, Metal up 0.86%, Power up 0.80% and Capital Goods up 0.70% were the top gainers, while Auto down 0.43%, IT down 0.23% and Oil & Gas down 0.16% were the only laggards in the space.

Tata Steel up 1.90%, Sterlite Industries up 1.56%, Maruti Suzuki up 1.38%, SBI up 1.34% and BHEL up 1.31% were the major gainers on the Sensex, while Jindal Steel down 1.38%, Hero MotoCorp down 1.25%, TCS down 1.13%, Tata Motors down 0.99% and Bajaj Auto down 0.85% were the major losers in the index.

Meanwhile, with an aim to achieve the disinvestment target set for the current fiscal, the government is planning to divest up to 25% stake in Tehri Hydro Development Corporation (THDC), which is likely to fetch an amount of nearly Rs 1,300 crore to the government. On the sidelines, Mohammad Haleem Khan, Secretary in the Department of Disinvestment (DoD) said the Power ministry has given its approval for initial public offering of THDC.

THDC, a joint venture corporation of the Centre and Uttar Pradesh government, is not planning to raise any fresh equity through an initial public offering, which is likely by the end of current financial year 2012-13. The company, which is in a process of revising its memorandum of association as the existing one cannot apply to the new joint public-private partnership model before it approaches the market regulator SEBI for a clearance.

As per the current memorandum of association, the company plans to promote and organize an integrated and efficient development of conventional, non-conventional or renewable sources of energy and River Valley Projects in India and abroad, which includes planning, investigation, research, design and preparation of preliminary, feasibility and Detailed of Project Reports (DPR), construction of such power stations and projects, generation, transmission and distribution of power.

In the current financial year, the government has planned a target of Rs 30,000 crore from divestment from public sector undertaking. In the fiscal year 2011-12, the government had planned to raise Rs 40,000 crore but was able to achieve only Rs 14,000 crore through PSU stake sale.   

The S&P CNX Nifty is currently trading at 5,294.05, higher by 15.15 points or 0.29% after trading as high as 5,295.25 and as low as 5,263.35. There were 32 stocks advancing against 18 declines on the index.

The top gainers on the Nifty were ACC up 3.66%, DLF up 3.35%, JP Associates up 2.93%, Cairn India up 2.24% and Tata Steel up 1.90%.

Jindal Steel down 1.59%, Hero MotoCorp down 1.41%, TCS down 1.09%, Bajaj Auto down 1.07% and Tata Motors down 1.01% were the major losers on the index.

In the Asian space, Jakarta Composite climbed 0.78%, Shanghai Composite inched higher 0.03%, KLSE Composite rose 0.14%, Straits Times Index advanced 1.04% and Taiwan Weighted ascended 0.67%. On the other hand, Nikkei 225 inched down 0.04% and KOSPI Composite Index fell 0.13%.

Stock markets in Hong Kong remained closed on Monday on account of a public holiday.

The European markets were trading in green with, France’s CAC 40 ascended 1.61%, Germany’s DAX added 1.42% and the United Kingdom’s FTSE 100 rose 0.76%.