Benchmark equity indices trim gains as investor’s turn jittery ahead of Fed's decision

Benchmark equity indices have trimmed some of their early gains as investors turning jittery have cashed out some of their profits on account of lingering uncertainty surrounding the US Federal Reserve’s decision on quantitative easing measures on conclusion of the two day meeting, later in the day. Further, with European futures too showing negative trend, mood has turned out to be bit cautious. However, the underlying sentiment at Dalal Street remains upbeat on hopes of accelerated pace of policy reforms on reports suggesting cabinet considering relaxing the norms on foreign direct investment (FDI) in aviation on Friday, which has sent Aviation stocks soaring higher for second consecutive session. Meanwhile, hopes for a rate cut as early as next week's policy review if inflation surprises on the downside or government announces fiscal consolidation steps, are also doing well for Indian equity markets, which are currently oscillating near to the 7 months high level. Furthermore, Asian shares are mostly trading in positive territory on optimism ahead of further stimulus action to bolster the world's largest economy.

Closer home, at this point of time, although markets have cooled from intra-day’s high level, 30 share barometer index of Bombay Stock Exchange, Sensex, is currently oscillating above the 18k level, while widely followed 50 share barometer index of National Stock Exchange, Nifty, too holding above the 5400 crucial mark. Meanwhile, broader indices have trimmed some gains.

Gains of Oil & Gas, Public Sector Undertaking (PSU) and Capital Goods counters, toppling the buying list, have emerged as pillars of strength, while stocks from Healthcare, Realty and Technology counters are capping the upside of the bourses. Further, Cement stocks will be in focus today in trade, as the Competition Appellate Tribunal (COMPAT) will hear the appeals filed by cement companies against the Competition Commission of India (CCI) order. The companies who have appealed to the tribunal include-- Ultra Tech Cement, Lafarge India, India Cement, ACC, Binani Cement, Ambuja Cement, Madras Cement, J K Cement and Century Textiles.

The BSE Sensex is currently trading at 18,034.74 up by 34.71 points or 0.19% after touching a high of 18,062.68 and low of 17,993.97. There were 17 stocks advancing against 13 declines on the index.

The broader indices too pared some gains; the BSE Mid cap and Small cap indices were trading up by 0.30% and 0.20% respectively.

The top gaining sectoral indices on the BSE were Oil and Gas up by 1.15%, PSU up by 1.03%, CG up by 0.91%, Power up by 0.51% and Bankex up by 0.49%. While, HC down by 0.61%, Metal down by 0.28% and Realty down by 0.03% were top losers on the index.

The top gainers on the Sensex were Hero MotoCorp up by 2.23%, ONGC up by 1.89%, BHEL up by 1.34%, Gail India up by 1.31% and Bajaj Auto up by 1.30%.

On the flip side, Cipla was down by 2.59%, Bharti Airtel down by 1.95%, Sterlite Industries down by 1.05%, Jindal Steel down by 1.00% and Mahindra & Mahindra down by 0.95% were the top losers on the Sensex.

Meanwhile, the honchos of Public sector companies (PSUs) in infrastructure met Finance Minister (FM) - P Chidambaram on September 12, 2012 and confirmed their willingness to boost up investments. The chiefs have asked the government to prioritize solution for the issues related to project approvals and availability of coal.

Finance Minister called up the meeting to push blue-chip PSUs sitting on cash pile of about Rs 1.8 lakh crore to accelerate investment plans. Finance Ministry is aimed on pushing manufacturing sector and overall economic growth which declined to 9-year low of 6.5% during 2011-12.

NTPC’s Chairman and Managing Director (CMD) Arup Roy Choudhury, BHEL’s Chairman and Managing Director (CMD) B Prasada Rao, Coal India’s CMD S Narsing Rao, ONGC’s Chairman Sudhir Vasudeva, SAIL’s chairman C S Verma along with the heads of NMDC, MMTC and Oil India attended the meeting. The secretaries of different ministries dealing with the infrastructure sector were also present at the meeting.

As per the economic data for April-June 2012-13, the quarterly growth declined to 5.5% from 8% in the same quarter last fiscal and it was mainly due to poor performance of manufacturing sector.

The S&P CNX Nifty is currently trading at 5,438.05, up by 7.05 points or 0.13% after trading in a range of 5,447.45 and 5,425.10. There were 26 stocks advancing against 22 declines on the index, while 2 remained unchanged.

The top gainers of the Nifty were Hero MotoCorp up by 2.21%, BPCL up by 1.91%, ONGC up by 1.86%, HCL technologies up by 1.43% and BHEL up by 1.39%.

On the flip side, Cipla down by 2.82%, Ranbaxy down by 2.24%  Bharti Airtel down by 1.84%, Sesa Goa down by 1.51% and Jindal Steel down by 1.07%, were the major losers on the index.

Asian equity indices were mostly trading in green; Hang Seng index added 0.23%, Jakarta Composite rose 0.03%, KLSE Composite jumped higher by 0.56%, Nikkei 225 gained 0.39%, Taiwan Weighted advanced 0.11%, Strait Times edged higher by 0.07% and Kospi Composite Index was trading in green with 0.11% gains. On the flip side, Shanghai Composite declined 0.03%. 

European markets have got off to a cautious start, with CAC 40 trading lower by 0.22%, FTSE 100 inching lower by 0.01% and DAX trading flat with positive bias.