Benchmarks continue lackadaisical trade below neutral line

Indian equities continued lackadaisical trade below neutral line in the late morning session. On the global front, the majority of Asian markets were trading in red mainly due to Japan’s trade deficit widened to 517.4 billion yen ($6.5 billion) in July, compared with a revised 60.3 billion yen surplus in June, mainly due to Europe’s sovereign-debt crisis and a slowdown in China, which dragged down nation’s exports. Back home, traders were seen piling up position in Auto, HC and CD sector, while selling was witnessed in TECk, Power and CG sector. Sun Pharma, Dr Reddys Lab, Ranbaxy Lab and Cipla from HC pack were seen trading firm in green driving the markets higher. Tata Motors, Mahindra & Mahindra, Bajaj Auto, Maruti Suzuki Bajaj Auto and Hero MotoCorp from Auto space were trading in green edging the markets higher. On the other hand, Bharti Airtel, Wipro, and HCL Tech from TECk pack were trading in red drifting markets lower. In the scrip specific development, Wockhardt jumped on receiving USFDA approval for anti-hypertensive drug Felodipine. IL&FS Engineering gained on securing two construction projects worth Rs 494 crore. Jet Airways soared on plan to launch new Mumbai-Sharjah service to enhance Gulf connectivity. The NSE Nifty and BSE Sensex were managing to hold their psychological 5400 and 17800 levels respectively.

The market breadth on BSE was positive in the ratio of 1220:849 while 114 scrips remained unchanged.

The BSE Sensex is currently trading at 17881.59 down 3.67 points or 0.02% after touching a high of 17895.79 and low of 17800.29. There were 17 stocks advancing against 13 declines on the index.

The broader indices were trading on a positive note; the BSE Mid cap index was up by 0.30%, while Small cap index was up by 0.40%.

On the BSE sectoral space, Auto up by 0.73%, HC up by 0.71%, CD up by 0.28%, PSU up by 0.25% and IT up by 0.05% were the gainers while TECk down by 0.31%, Power down by 0.30%, CG down by 0.27%, Realty down by 0.17% and BANKEX down by 0.15% were the losers on the index.

Maruti Suzuki up by 2.92%, Hindalco Industries up by 1.59%, Dr Reddys Lab up by 1.13%, Hero Moto Corp up by 1.10%, BHEL up by 0.91% were the major gainers on the Sensex, while Bharti Airtel down by 2.71%, Tata Power down by 1.30%, Sterlite Industries down by 1.06%, Wipro down by 0.75% and Jindal Steel down by 0.67% were the major losers on the index. 

Meanwhile, pouring cold water to the much sought demand, the Minister of State in the Petroleum and Natural Gas Ministry, R.P.N. Singh said to the upper house that the government has no immediate plans to deregulate the prices of diesel, domestic LPG and kerosene sold under public distribution system (PDS).

The government is providing a subsidy of Re 0.82 a litre on PDS kerosene and Rs 22.58 a litre on 14.2 kg per cylinder on domestic LPG from the fiscal budget under the ‘PDS Kerosene and Domestic LPG Subsidy Scheme, 2002’.While, PSU oil marketing companies bear rest of the burden, they are losing Rs 15.55 a litre on diesel, Rs 29.97 a litre on kerosene and Rs 231 on every 14.2-kg LPG cylinder.

Rising fiscal deficit has not only been termed alarming but disturbing as well by the different government and regulatory agencies. The central government’s fiscal deficit in FY13 is expected to be much higher than the budget estimate of 5.1% of GDP.

Even C Rangarajan, chief of PM's Economic Advisory Council, recently said that he expect the government to raise diesel and cooking gas prices shortly, saying that the move would essentially be aimed at averting a possible downgrade by international rating agencies by signaling the government's intent to address the problem of rising subsidy bill and fiscal deficit. 

The S&P CNX Nifty is currently trading at 5,418.65, down by 2.35 points or 0.04% after trading in a range of 5,422.60 and 5,394.80. There were 23 stocks advancing against 27 declines on the index.

The top gainers on the Nifty were Ranbaxy up by 1.89%, BPCL up by 1.55%, DR Reddy up by 1.39%, Hindalco by 1.20% and Sun Pharma up by 1.09%. While, Bharti Airtel  down by 2.73%, Tata Power by 1.40%, HCL Tech down by 1.35%, Sterlite Industries down by 1.19% and IDFC down by 1.14% were the top losers on the index.

Most of the Asian indices were trading in red; Straits Times down by 0.50%, Shanghai Composite down by 0.38%, Kospi Composite Index down 0.37%, Taiwan Weighted down by 0.27%, Nikkei 225 down 0.31% and Hang Seng index down by 0.78% while KLSE Composite up by 0.15% was only the gainer.

Jakarta Composite is closed till Wednesday, due to Idul Fitri holidays.