Sensex, Nifty in tight range; Auto stocks recover on Sept sales numbers

Indian equity markets moving in a tight band since morning and currently trading in positive territory as investors are treading cautiously and not participating in any big buying. In currency markets, rupee erased all early losses and recovered against dollar, following lower opening on Monday amid foreign funds inflows and dollar selling by banks and other importers. On sectoral front information technology stocks, led by Infosys, were trading firm. Automobile, healthcare and FMCG stocks were finding modest support, while bank and metal stocks were a bit weak. Meanwhile, country's largest car maker Maruti Suzuki rallied 1.3% as the company sold 93,988 units in September, while cement stocks too were witnessing buying interest ahead of monthly sales numbers today. In global markets, most Asian shares were trading in red. Back home, the market breadth favoring positive trend; there were 1,552 shares on the gaining side against 952 shares on the losing side while 110 shares remain unchanged.

The BSE Sensex is currently trading at 18791.15 up by 28.41 points or 0.15% after trading in a range of 18822.15 and 18759.19. There were 14 stocks advancing against 16 declines on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.79% and Small cap index was up by 0.94%.

On the BSE sectoral space, IT up by 1.19%, TECk up by 1.03%, Auto up by 0.58%, HC up by 0.28% and PSU up by 0.26% were the top gainers. While, Metal down by 0.46%, Bankex down by 0.30% and CD down by 0.12% were the top losers.

The top gainers on the Sensex were Infosys up by 1.98%, Tata Motors up by 1.70%, BHEL up by 1.38%, Maruti Suzuki up by 1.34% and SBI up by 0.85%. On the other hand, Tata Steel down by 1.40%, HDFC Bank down by 1.11%, Tata Power down by 0.89%, Bajaj Auto down by 0.82% and Coal India down by 0.61% were top losers on the Sensex.

 Meanwhile, supported by faster output growth and rising export orders, India’s manufacturing activity growth in September held steady compared with August. Measures by the US Federal Reserve and the European Central Bank to revive their economies mainly pushed foreign demand for Indian goods higher. At the same time, order book volumes increased for the forty-second successive month on stronger demand, good product quality and increasing marketing. However, the report cautioned the chances of rise in inventories dampening the output growth in coming months.

According to the HSBC purchasing managers’ index (PMI), a headline index designed to measure the overall health of the manufacturing sector, expanded at steady space of 52.8 in September, unchanged from August reading. A PMI reading above 50 indicates expansion in the sector, while one below suggests decline. In a sign of relief, the new export orders sub-index, an indicator of prospective overseas business, jumped to 53.8 from 49.2 in August, thereby positing biggest rise in almost two years.

Additionally seventh successive month of growth was recorded for employment in the month of September, with payroll numbers increasing to meet stronger demand, thereby signaling expansions in marketing departments. The inflation picture, on the other hand, was a bit mixed. While input prices rose at a faster clip on the back of higher raw material and diesel prices, output prices rose somewhat less, thereby adding to the Reserve Bank of India's dilemma of boosting growth while trying to rein in stubbornly high inflation.

Since manufacturing accounts for around 15 percent of India's gross domestic product, so a slowdown would not augur well for Asia's third-largest economy, which is already languishing near its slowest pace of growth in a decade for Q1. Poor showing by the manufacturing sector pulled down the GDP growth to 5.5% in the first quarter, the decade's worst Q1 performance, against the growth figure of 8% in the corresponding period in the last fiscal. The survey, although estimates the growth in the manufacturing sector to remain subdued, but at the same has underscored the implementation of recently announced reforms to help facilitate a gradual recovery during the second half of the fiscal year.

The S&P CNX Nifty is currently trading at 5,709.30, up by 6.00 points or 0.11% after trading in a range of 5,715.60 and 5,696.00. There were 26 stocks advancing against 24 declines on the index.

The top gainers of the Nifty were Ambuja Cement up by 3.44%, JP Associates up by 2.31%, Infosys up by 2.07%, Ultra Cement up by 1.96% and Tata Motors was up by 1.78%. While, Tata Steel down by 1.36%, HDFC Bank down by 1.21%, Kotak Bank down by 1.06%, PNB down by 0.82% and Bank of Baroda down by 0.72% were top losers on the index.

Most of the Asian equity indices were trading in the red; Jakarta Composite was down by 0.65%, Nikkei 225 down by 0.82%, Straits Times down by 0.38% and Taiwan Weighted was down by 0.51%. On the flip side, KLSE Composite was up by 0.17%.

Markets in China, Hong Kong and South Korea are closed today for holidays.