Firm trade prevails in the late afternoon session

Indian equities added gains to continue firm trade above neutral line in the late afternoon session taking clues from European counterparts. Investors have been picking fundamentally beaten down stocks after the indexes fell for the previous four consecutive sessions. The market have however made cautious approach on reports that consumer confidence in India has declined for the first time in nine quarters due to weak employment sentiment and subdued spending behaviour, according to Nielsen global consumer confidence index. Traders were seen piling up position in Health Care, FMCG and Bankex sector while selling was witnessed in Auto, IT and Power sector. Power stocks, are trading lackluster ahead of the Planning Commission meet with the state power ministers to take on board issues hampering the growth of the crucial power sector, mainly that of fuel shortages and the weak financial health of distribution companies.

In the scrip specific development, aviation companies like Jet Airways, Spicejet and Kingfisher Airlines were seen trading under pressure since Oil firms have hiked the ATF or jet fuel prices by 1.7%. This development comes as blow to the already beleaguered aviation sector, as jet fuel constitutes more than 40% of the airline’s operating cost. Bajaj Finance has touched 52-week high on reporting 53% jump in Q1 net profit. Ranbaxy Laboratories is firm in green on reports that it has received USFDA approval for its new drug application for antibiotic minocycline hydrochloride extended release capsules in five strengths. Tata Steel is trading in green on reports that it will sell its 50% stake in HKS to Euro Scrap Alliance.

On the global front, the Asian markets were trading in green while the European markets were too trading on optimistic note. The IMF trimmed the UK outlook for this year to 0.2% from the previous estimate in April of 0.8%, held its forecast of 0.3% contraction for the euro zone, trimmed growth in China to 8% from 8.2%. Investors have started eyeing bond auctions of Spain and France which is scheduled on Thursday i.e. July 19, 2012, ahead of a meeting of European officials which is scheduled on Friday i.e. July 20, 2012, to hammer out the final details of the Spanish bank bailout. On the home turf, the NSE Nifty and BSE Sensex were trading above their psychological 5,200 and 17,100 levels respectively. The market breadth on BSE was negative in the ratio of 1520:1098 while 126 scrips remained unchanged.

The BSE Sensex is currently trading at 17,151.25, up by 47.94 points or 0.28% after trading in a range of 17236.08 and 17,108.31 respectively. There were 21 stocks advancing against 9 declines on the index.

The broader indices shaving all gains, slipped into the red territory; the BSE Mid and Small cap indices were trading lower by 0.38% and 0.36% respectively.

The top gainers on the BSE sectoral space were, Health Care up by 1.12%, FMCG up by 0.91%, Bankex up by 0.24%, Metal up by 0.21% and Consumer Durable were up by 0.12%.  On the flip side, major losers were Auto down by 0.82%, IT down by 0.42%, Power down by 0.41%, Oil & Gas down by 0.12% and Capital Goods down by 0.05%.

Dr Reddy’s Lab up by 2.42%, Bharti Airtel up by 2.32%, Sun Pharma up by 1.96%, Wipro up by 1.53% and Hindalco Industries up by 1.44% were the top gainers on the Sensex, while Bajaj Auto down by 3.10%, TCS down by 2.12%, Sterlite Industries down by 0.69%, BHEL down by 0.67% and Tata Motors down by 0.63% were the major losers in the index.

Meanwhile, adding to the woes of looming global economic slowdown, International Monetary Fund (IMF) has pegged India’s economic growth projection lower by 0.7% at 6.1% for 2012, while global growth forecast for the same year has been reduced to 3.5% from 3.6%.It also warned that the outlook could dim further if policymakers in Europe do not act with enough force and speed to quell their region's debt crisis.

The global lender has also shaved 2013 growth projection of India to 6.5%, while global growth projections were lowered to 3.9% from 4.1%. It also estimates that the advanced economies would grow only by 1.4% this year and 1.9% in 2013, while that of developing economies would be by 5.6% in this year and 5.9% by 2013.

India's economic growth has fallen to a nine-year low of 6.5% in 2011-12 fiscal, the World Bank projected Indian economy to grow at 6.9% in the current fiscal, from the earlier 7%. The IMF expects the US economy to expand by 2 percent and 2.3 percent in 2012 and 2013, respectively.

The S&P CNX Nifty is currently trading at 5,208.50, up by 11.25 points or 0.22% after trading in a range of 5,236.70 and 5195.90 respectively. There were 27 stocks advancing against 22 declines, while one stock remained unchanged on the index.

The major gainers on the Nifty were Dr Reddy’s Lab up by 2.46%, Bharti Airtel up by 2.39%, Sun Pharma up by 1.93%, Hindalco Industries was up by 1.56% and Wipro up by 1.42%.  While Bajaj Auto down by 3.33%, BPCL down by 2.28%, TCS down by 1.88%, Axis Bank down by 1.44% and Reliance Infrastructure down by 1.34% were major losers on the index.

All the Asian equity indices were trading in the green; Shanghai Composite gained 0.62%, Hang Seng index surged by 1.75%, Jakarta Composite added 0.70%, KLSE Composite rose 0.15%, Kospi Composite Index up 0.23%, Nikkei 225 inched higher by 0.35% and Taiwan Weighted expanded by 0.52%.

The European markets were trading in green with, France’s CAC 40 ascending 0.58%, Germany’s DAX added 0.57% and the United Kingdom’s FTSE 100 gained 0.12%.