Indian equities trim losses; Nifty above 5,200 mark

Indian equities trimmed losses but continued its weak trade below neutral line in the late afternoon session as buying emerged in the market coupled with clues from European counterparts. The official confirmation of drought like situation from the India Meteorological Department spooked investors’ sentiment but investors accumulated blue chip counter at the lower levels trimming losses. Traders were seen piling up position in Health Care, Oil & Gas and Power sector while selling was witnessed in Metal, Capital Goods and Auto sector. In the scrip specific development, Mahindra Satyam was seen trading firm in green as the company has reported a rise of 44.49% in its net profit at Rs 332.56 crore for Q1FY13 as compared to Rs 230.16 crore for the same quarter in the previous year. Berger Paints was trading in green after reporting a rise of 17.19% in its net profit at Rs 47.70 crore for Q1FY13 as compared to Rs 40.70 crore for the same quarter in the previous year.

On the global front, the Asian markets were trading mostly in red while the European markets were trading on optimistic note. However, investors were disappointed as ECB President Mario Draghi failed to deliver immediate action to stem the region’s debt crisis. ECB President Mario Draghi stated that the institution might intervene in bond markets to help bring down borrowing costs for struggling euro-zone countries, but will only act after governments ask for help from the region’s rescue funds, disappointing investors banking on immediate action. Investors have started anticipating that Draghi’s decision to postpone action by demanding euro-zone governments turn to existing rescue funds before the ECB intervenes may worsen the crisis. On the home turf, the NSE Nifty and BSE Sensex were trading below their psychological 5,250 and 17,200 levels respectively. The market breadth on BSE was negative in the ratio of 1105:1486 while 133 scrips remained unchanged.

The BSE Sensex is currently trading at 17,163.98, down by 60.38 points or 0.35% after touching a high and low of 17,173.06 and 17,026.97 respectively. There were just 11 stocks advancing against 19 declines on the index. The broader indices too pared some losses; the BSE Mid cap index was down by 0.10%, while Small cap index has lost 0.15%.

The lone gainer on the BSE sectoral space was Health Care up by 0.69%, Oil & Gas up 0.28%, Power up 0.20% and IT up 0.12% while Metal down by 1.71%, Capital Goods down by 0.95%, Auto down by 0.90%, Bankex down by 0.64% and Realty down by 0.39% were the top losers on the BSE sectoral space.

NTPC up by 2.66%, Dr Reddy’s Lab up by 1.63%, Wipro up by 1.29%, ONGC up 0.87% and Sun Pharma up by 0.66% were major gainers on the Sensex, while Sterlite Industries down by 2.53%, Tata Steel down by 2.17%, Hindalco Industries down by 1.85%, ICICI Bank down by 1.84% and Jindal Steel down by 1.78% were the major losers in the index.

Meanwhile, the Department of Telecom (DoT) in its proposal to the Union Cabinet, has proposed to retain the existing 'slab rate' system of revenue sharing for spectrum usage charge (SUC). The acceptance of the proposal will help new entrants as they will have to pay a lower levy.

The Empowered Group of Minister (EGoM) had recommended both the existing slab rate system of revenue sharing as the preferred option and 5% flat rate as an alternate. But the ministry has proposed the existing system of revenue sharing.

The Cabinet is likely to meet to discuss the reserve price and usage charges of spectrum that is to be auctioned as per the Supreme Court order. The Empowered Group of Ministers (EGoM), headed by P Chidambaram has suggested to fix the reserve price either at Rs 14,000 crore or Rs 15,000 crore for 5 Mhz of GSM spectrum in the 1800 Mhz band, respectively.

The S&P CNX Nifty is currently trading at 5207.15, down by 20.60 points or 0.39% after touching a high and low of 5,210.15 and 5,164.65 respectively. There were 17 stocks advancing against 33 declines on the index.

The major gainers on the Nifty were NTPC up by 2.57%, Ranbaxy Laboratories up by 2.56%, Asian Paints up by 1.85%, PNB up by 1.69% and Dr Reddy’s Lab up by 1.58%. While, Sterlite Industries down by 2.58%, Tata Steel down by 2.20%, JP Associates down by 2.20%, Jindal Steel down by 2.07% and SAIL down by 1.96% were the major losers on the index.

Asian indices were trading mostly in red; Hang Seng was down by 0.12%, Jakarta Composite down by 0.07%, Nikkei 225 plunged by 1.13%, Kospi Composite Index plummeted by 1.11% and Taiwan Weighted lost 0.69%. On the other hand, KLSE Composite added 0.04%, Shanghai Composite ascended 1.02% and Straits Times gained by 0.55%.

The European markets were trading in green with, France’s CAC 40 ascending 1.30%, Germany’s DAX added 1.46% and the United Kingdom’s FTSE 100 jumped 0.84%.