Markets remain aggressive; Sensex up 252 points

Indian equities gained strength to continue firm trade on back of strong buying in frontline counters in late morning session. On the global front, most of the Asian counters were trading in the green at this point of time supported by gains in commodities stock and weak economic data signaling governments may have to do more to support their economies. Back home, traders were seen piling up position in Auto, Metal and Realty sector.DLF, Unitech, HDIL, Oberoi Realty, Indiabulls Real Estate, Godrej Properties and Phoenix Mills from Realty pack were seen trading in green edging the markets higher. Tata Steel, Coal India, Jindal Steel, Hindalco Industries, Sterlite Industries and JSW Steel from Metal pack were seen trading firm in green.

Meanwhile, the sentiments also got support on government’s decision of no extra borrowing in the current year. The finance ministry asserted its commitment to containing fiscal deficit by sticking to its borrowing target and said that government will borrow Rs 2 lakh crore in the remaining period of the current fiscal to stick to the target of 5.1 per cent of the Gross Domestic Product.

In the scrip specific development, TCS gained on launching Firebird Plus for Oracle Fusion HCM. Yes Bank rose on receiving RBI nod to set up broking subsidiary.  Lanco Infratech jumped on the plans of raising $1 billion by March 2013.Nitta Gelatin India edged higher on launching ‘Gelixer CollagenPep’ in Tamil Nadu. ABC Bearings soared on forming joint venture with TVS Automobile Solutions for Gujarat. Mukand surged on plan to transfer cold finished bars and wire business to subsidiary.

The NSE Nifty and BSE Sensex were managing to hold their psychological 5,700 and 18,800 levels respectively. The market breadth on BSE was positive, in the ratio of 1662:594.

The BSE Sensex is currently trading at 18831.83 up by 252.33 points or 1.36% after trading in a range of 18869.94 and 18698.51. There were 29 stocks advancing against 1 decline on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.32% and Small cap index was up by 1.10%.

On the BSE sectoral space, Auto up by 2.49%, Metal up by 2.43%, Realty up by 2.24%, Power up by 1.91% and CD up by 1.34% were the top gainers. While, there was no loser.

The top gainers on the Sensex were Tata Motors up by 4.39%, Tata Power up by 3.78%, Hindalco Industries up by 3.60%, Jindal Steel up by 3.26% and Tata Steel up by 2.79%. On the other hand, Sun Pharma down by 0.04% was only the loser on the Sensex.

 Meanwhile, amid the growing concern of rising fiscal deficit the government has retained its H2FY13 borrowing target and will borrow Rs 2 lakh crore in remaining period of the current fiscal. The government budgeted to borrow Rs 5.7 lakh crore this fiscal, or 5.1 per cent of the Gross Domestic Product (GDP), including repayments. In the first six months, it has already borrowed Rs 3.7 lakh crore.

Though, the finance ministry admitted that the fiscal deficit could overshoot the target of 5.1 per cent of GDP but hoping that government’s recent efforts to cut down spends would show results, it stick to its Budgeted borrowing plan of Rs 2 lakh crore for the second half of the fiscal. In the October-March period last financial year, it had borrowed Rs 2.6 lakh crore.

Finance ministry is expecting the fiscal deficit to be maximum of 5.2 to 5.3 per cent, which according to it is doable, however the general expectation is that it may rise to 5.8 per cent of GDP and the government would have to announce extra borrowing to meet that, as the government is unlikely to cut further spending with slower tax revenue generation amid weaker domestic growth.

Although the government is looking to reduce its subsidy burden, attract foreign flows and sell stakes in state owned companies but its previous policies of high subsidy expenditure has led to overshooting of government finances and to meet that the government has been relying on market borrowing, which has been crowding out private investors and lowering growth prospects. 

The S&P CNX Nifty is currently trading at 5,729.55, up by 80.05 points or 1.42% after trading in a range of 5,735.15 and 5,683.45. There were 48 stocks advancing against 2 declines on the index.

The top gainers of the Nifty were Tata Motors up by 4.39%, Tata Power up by 3.87%, JP Associates up by 3.79%, Hindalco up by 3.52% and Jindal Steel was up by 3.47%. While, Sun Pharma down by 0.10% and HDFC Bank down by 0.02% were the losers on the index.

Most of the Asian indices were trading in green, Shanghai Composite was up by 1.01%, Kospi Composite Index was up by 0.15%, Taiwan Weighted was up by 0.18%, Hang Seng was up by 0.33%, Jakarta Composite was up by 0.35%, Straits Times was up by 0.30% and KLSE Composite was up 0.58% while Nikkei 225 down by 0.97% was only the loser.