Benchmarks gyrate around neutral line

The Indian equity markets are gyrating around their neutral line. Global cues remained unsupportive as the US stocks edged lower overnight as a disappointing forecast from Caterpillar and weak German data increased concerns that global growth may remain sluggish. An index of German business sentiment declined for a fifth consecutive month in September, showing Europe's strongest economy was moving closer towards recession as the euro zone’s debt crisis remains unresolved while, Asian markets were trading mostly in the red. Back home, traders were seen piling up position in HC, FMCG and Power sector, while selling was witnessed in Metal, Auto and Oil & Gas sector. Sun Pharma, Cipla, Lupin and Ranbaxy Lab from HC pack were seen trading in green edging the markets higher. ITC, Hindustan Unilever, Nestle India and United Spirits from FMCG pack were seen trading firm in green. Metal majors - Tata Steel, Coal India, Jindal Steel, Hindalco Industries and Sterlite Industries were capping the markets’ gains while Auto majors Tata Motors, Bajaj Auto, Maruti Suzuki, Hero Moto Corp too were pressurizing the markets.

Meanwhile, power stocks PTC India, Power Finance Corporation, Rural Electrification Corporation edged higher after government on Monday cleared Rs 1.90 lakh crore debts restructuring for power distribution companies, the second such move in less than a decade for entities that keep running up losses due to severe political interference even in regulatory agencies that fix tariffs.

In the scrip specific development, MindTree rose on opening new US Development Center for business. GCPL gained on entering into an agreement to include hair extensions business in Kenya. Sunil Hitech Engineers edged higher on bagging orders worth Rs 370 crore. Accel Frontline jumped on getting nod to merge Accel Frontline Services with itself.

The NSE Nifty and BSE Sensex were managing to hold their psychological 5,600 and 18,700 levels respectively. The market breadth on BSE was positive, in the ratio of 1078:1058.

The BSE Sensex is currently trading at 18690.61 up by 17.27 points or 0.09% after trading in a range of 18790.01 and 18648.81. There were 11 stocks advancing against 19 declines on the index.

The broader indices were trading on mix note; the BSE Mid cap index was down by 0.02% and Small cap index was up by 0.19%.

On the BSE sectoral space, HC up by 0.72%, FMCG up by 0.70%, Power up by 0.70%, CG up by 0.69% and IT up by 0.46% were the top gainers. While Metal down by 0.91%, Auto down by 0.73%, Oil & Gas down by 0.57%, Realty down by 0.34% and Bankex down by 0.31% were the top losers.

The top gainers on the Sensex were Cipla up by 2.33%, HDFC up by 1.46%, NTPC up by 1.29%, BHEL up by 1.09% and TCS up by 1.04%. On the other hand, Jindal Steel down by 2.68%, Tata Steel down by 1.56%, Tata Motors down by 1.39%, Maruti Suzuki down by 1.36% and Hero Moto Corp down by 1.24% were the top losers on the Sensex.

 Mean while, the steel imports surged by 40% to 3.354 Million Tonnes (MT) during April -August period of current fiscal due to increased demand from sectors including automobiles and consumer durables. Joint Plant Committee (JPC) of the Steel Ministry said “demand remains firm with sectors like consumer durables, machinery and equipment, electricity and motor vehicles. The present import growth may well be due to the combined demand momentum provided by these sectors”.

China is the largest exporter for steel with a share of 24% of the total imports at 0.809 MT followed by South Korea at 0.657 MT, Japan at 0.528 MT, Ukraine at 0.188 MT and Germany at 0.140 MT, respectively.

JPC added that policy provisions associated to concessional import duty to items from South Korea and Japan under Comprehensive Economic Partnership Agreement (CEPA) is also instrumental in a significant growth in imports from these nations, at present in decline mode with supply exceeding demand. Price concern is another key factor influencing trends in imports with the comparative strength in domestic prices in relation to import prices.

The S&P CNX Nifty is currently trading at 5,667.90, down by 1.70 points or 0.03% after trading in a range of 5,702.70 and 5,655.55. There were 21 stocks advancing against 29 declines on the index.

The top gainers of the Nifty were Cipla up by 2.45%, HDFC up by 1.54%, Ranbaxy up by 1.49%, HCL Tech up by 1.34% and Grasim was up by 1.09%. While, Cairn down by 3.60%, Jindal Steel down by 2.61%, Axis Bank down by 2.54%, IDFC down by 1.86% and Hero Moto Co down by 1.70% were the losers on the index.

Most of the Asian indices were trading in red, Shanghai Composite was down by 0.33%, Kospi Composite Index was down by 0.38%, Taiwan Weighted was down by 0.46%, Hang Seng was down by 0.08%, and Nikkei 225 was down by 0.19%. 

On the other hand, Jakarta Composite was up 0.06%, KLSE Composite was up 0.50%, Straits Times was up by 0.20%.