Benchmarks cool from intra-day high; broader indices outperform

Indian equity markets so far have been doing well on the last day of September derivative expiry. However, benchmark equity indices after touching intra-day’s high, have pared off slender gains, nevertheless optimism still prevails at Dalal Street.  Much of the strength seems to be coming from stocks belonging from Capital Goods, Auto and Fast Moving Consumer Goods, which enticing investor’s attention, have emerged as shinning stars. On the flip side, stocks from Oil & Gas, Information Technology, are acting as the only spoil sports on BSE sectoral front.

Thus, despite cooling from intra-day’s high, 30 share index, Sensex, is trading above 18700 level, while 50 share index, Nifty, is oscillating above the 5670 level. Meanwhile, broader indices outperforming frontline indices, have puffed up gains of over 0.50%.Meanwhile, some sense of comfort was also drawn by the investors after United Progressive Alliance (UPA) coordination committee on Thursday extended its full support to Prime Minister Dr Manmohan Singh for taking bold initiatives to improve the economic situation in the country.

The BSE Sensex is currently trading at 18,704.30, up by 72.13 points or 0.39% after trading in a range of 18,735.95 and 18644.77. There were 21 stocks advancing against 9 declines on the index.

The broader indices were trading in green; the BSE Mid cap and Small cap indices were trading higher by 0.80% and 0.63% respectively.

The top gainers on the BSE sectoral space were, CG up by 1.08%, Auto up by 1.02%, Fast Moving Consumer Goods up by 0.82%, Power up by 0.72% and Health Care up by 0.67%. While Oil & Gas down by 0.44%, Information Technology down by 0.27% were the top losers on the sectoral space.

The top gainers on the Sensex were Tata Power up by 5.70%, L&T up by 2.13%, Mahindra & Mahindra up by 2.06%, Jindal Steel up by 1.56% and Maruti Suzuki up by 1.50%. On the other hand, BHEL down by 1.44%, Wipro down by 1.08%, Infosys down by 1.04%, ONGC down by 0.94% and Coal India down by 0.66% were the top losers on the Sensex.

 Meanwhile, soon after rolling out foreign direct investment (FDI) in multi-brand retail and aviation, Finance Minister P Chidambaram, continuing reforms juggernaut, has now shifted focus to insurance sector and is keen on raising the FDI cap in the sector to 49 per cent from the existing 26 per cent limit.

This move of the government, which off lately seems to be on fast forward mode on reform front, assumes significance as at the insurance summit earlier this week, Insurance Regulatory and Development Authority (IRDA) Chairman J Hari Narayan besides stressing the need for larger investments for growth of the sector also underscored that a hike in FDI limit would be welcome.

Working in speed towards this development, the Cabinet is likely to soon consider hiking the FDI limit in the sector, with finance ministry again holding a meeting with the insurance sector regulator today to deliberate upon the issues such as service tax and other tax relief measures for the industry.

Meanwhile, Finance Minister P Chidambaram already held a meeting with IRDA chairman on Sept 26 to take on board issues that could spur insurance penetration. Ways to ease investment norms to channelize more funds into the infrastructure sector, bancassurance and process of approval for opening offices in Tier-II and below towns were among the issues taken for discussion in the meeting. 

Further, in the meeting, sensing the need to increase insurance penetration and for reaching basic insurance cover to the rural areas, the ministry and the regulator also agreed upon designing insurance products with low insurance premiums and basic cover. 

The S&P CNX Nifty is currently trading at 5,685.05, up by 21.60 points or 0.38% after trading in a range of 5,693.70 and 5,665.10. There were 30 stocks advancing against 18 declines while 2 stocks remained unchanged on the index.

The top gainers of the Nifty were Tata Power up by 5.35%, HCL Tech up by 3.37%, L&T up by 2.15%, Mahindra & Mahindra up by 1.84% and Maruti Suzuki up by 1.75%. While, BHEL down by 1.56%, ONGC down by 1.24%, SAIL down by 1.23%, Infosys down by 1.13% and Wipro down by 1.04% were top losers on the index.

All the Asian indices were trading in green, Shanghai Composite added 2.36%, Kospi Composite Index gained 0.42%, Taiwan Weighted rose 0.18%, Hang Seng surged 1.06%, Nikkei 225 shot up by 0.48%, Jakarta Composite spurted by 1.17%, Straits Times ascended by 0.49% and KLSE Composite advanced 0.73%.

European markets got off to a positive start; with DAX adding 0.45%, FTSE 100 adding 0.26% and CAC 40 rising by 0.63%.