Indian equities trim gains; Metal, FMCG and Bankex leads

Indian equities trim gains but continued its firm trade above neutral line in the late afternoon session on account of profit booking at higher levels by domestic investors and taking clues from subdued European counterparts. Investors have started eyeing coming week‘s crucial RBI’s mid-quarterly policy review which is scheduled on July 31, 2012. Traders were seen piling up position in Metal, FMCG and Bankex sector while selling was witnessed in Realty, PSU and Capital Goods sector. In the scrip specific development, Punjab National Bank (PNB) was seen trading with cut of around more than five percent as bank's ratio of net non-performing assets (NPA) to net assets rose to 1.68%. Sun TV dropped on reports that CBI investigators are poised to file charges against the company's executive chairman Kalanithi Maran, and his brother, former telecom minister Dayanidhi Maran, over allegations of kickbacks.

On the global front, the Asian markets were trading in green barring KLSE Composite and Straits Times while the European markets were trading on pessimistic note. European Central Bank President Mario Draghi indicated that the institution is ready to resume purchases of Spanish and Italian government bonds in a bid to bring down borrowing costs and ensure the survival of the euro. Separately, Moody's Investors Service lowered its rating outlook on 17 German banking groups to 'negative' following outlook change on German sovereign and sub-sovereigns. Also, Egan-Jones, the credit rating agency downgraded Italy's sovereign debt rating to ‘CCC+’. On the home turf, the NSE Nifty and BSE Sensex were trading above their psychological 5,100 and 16,800 levels respectively. The market breadth on BSE was negative in the ratio of 1209:1400 while 130 scrips remained unchanged.

The BSE Sensex is currently trading at 16,832.07, up by 192.25 points or 1.16% after trading as high as 16,975.03 and as low as 16812.35. There were 23 stocks advancing against 7 declines on the index.

The broader indices were trading in red; the BSE Mid cap index dropped 0.41% while Small cap index was down 0.27%.

On the BSE sectoral space, Metal up by 1.89%, FMCG up by 1.32%, Bankex up 0.92%, IT up 0.92% and Consumer Durable up by 0.84% were the major gainers, while Realty down 0.48%, PSU down 0.12% and Capital Goods down 0.09% were the only losers on the index.

Sterlite Industries up by 3.53%, Tata Motors up by 3.25%, Tata Steel up by 3.21% HDFC Bank up by 3.18% and ICICI Bank up by 2.48% were major gainers on the Sensex, while SBI down by 2.09%, Hero MotoCorp down by 1.76%, BHEL down by 1.11%, Cipla down by 0.47% and Bajaj Auto down 0.32% were major losers in the index.

Meanwhile, some of the state governments and corporate bodies have come up to support the government to stand against Supreme Court’s verdict on 2G spectrum, which has allowed allocation of all natural resources to private companies through auction only.

Harish Salve, senior advocate, while appearing for Confederation of Indian Industry (CII) has contended that the verdict was specific to spectrum allocation and it could not be applied to all natural resources. He was advocating before a five-judge constitution bench headed by Chief Justice S H Kapadia on reference with the President‘s clarification seeking about the February 2 judgment of Supreme Court bench.

The Federation of Indian Chambers of Commerce and Industry (FICCI) had earlier opined that the 2G verdict has international implications as the apex court has entered into the domain of policy-making by holding the first-come-first-serve (FCFS) policy as illegal and unconstitutional.

The S&P CNX Nifty is currently trading at 5,105.75, up by 62.75 points or 1.24% after trading as high as 5,149.95 and as low as 5,093.10. There were 38 stocks advancing against 12 declines on the index.

The top gainers on the Nifty were Sterlite Industries up by 3.90%, Tata Steel up by 3.50%, Tata Motors up by 3.46%, HDFC Bank up by 3.31% and ICICI Bank up by 2.56%. While, Punjab National Bank down by 5.05%, Bank of Baroda down by 2.40%, BPCL down by 2.01%, SBI down by 1.97% and Hero MotoCorp down by 1.76% were major losers on the index.

Mostly Asian equity indices were trading in green; Hang Seng index surged 2.02%, Nikkei 225 added 1.46%, Taiwan Weighted shot up 2.21%, Shanghai Composite inched higher 0.13%, Kospi Composite Index soared by 2.62% and Jakarta Composite jumped by 1.98%, while KLSE Composite was down 0.14% and Straits Times dropped 0.03% were the only losers.

The European markets were trading in red with, France’s CAC 40 descended 0.20%, Germany’s DAX lost 0.53% and the United Kingdom’s FTSE 100 dropped 0.18%.