Post session - Quick review

It turned out to be a stable session of performance for benchmark equity indices at Dalal Street, which did not showcase extra-ordinary moves, but fair enough to sustain the upward trajectory of Indian equity markets. Renewed buying activity by the investor’s after a national holiday, mainly injected strength in bears, which running across the space, led to the outperformance of Indian equity markets in comparison to the rest of the globe. Thus, in the low -volume session of trade, benchmark BSE’s 30 share index - Sensex and NSE’s 50 share index - Nifty gained over and close to quarter percent to conclude above the respective 18800 and 5700 psychological levels. However, the session clearly belonged to broader indices, which showing degree of outperformance, went home with gains of over 0.50%.

On the global front, Asian pacific markets closed in red as holiday in China and hesitation ahead of Friday's key U.S. jobs report kept the market activity restrained. Moreover, data released which showed that China's non-manufacturing Purchasing Managers' Index fell to 53.7 in September from 56.3 in August, and that Chinese consumer sentiment weakened in September for a third month, also added to the already pessimistic milieu. Additionally, European shares dipped early on Wednesday, adding to the previous session's losses, as uncertainty surrounding a potential bailout for debt-stricken Spain and further signs of a slowdown in China, rattled investors.

Closer home, sectors that toppled the buying list on BSE sectoral chart, were Oil & Gas, Public Sector Undertaking and Fast Moving Consumer Goods. On the flip side, Auto, Consumer Durables and Information Technology space, topping the sectoral list from behind, appeared as the weak links of the trade. Most of the Auto stocks ran out of fuel on reporting lower than expected sales for the month of September. Additionally, Information Technology plunged on appreciation of rupee, as these firms derive lion share of their revenue in American currency. On the flip side, long positions were created in cement stocks on the hopes of product prices hike due to revival of post-monsoon construction activity, especially as upcoming elections in some states will boost execution of public infrastructure projects. In stock-specific action, Vijay Mallya’s group stocks were in focus today. Kingfisher Airlines tanked close to 5% on declaring partial lock-out. On the other hand, shares in United Spirits and United Breweries Holding ended sanguine over the possibility of a deal with Diageo. Thus, the market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1744:1185 while 138 scrips remained unchanged. (Provisional)

The BSE Sensex gained 48.64 points or 0.26% and settled at 18,872.55. The index touched a high and a low of 18,905.62 and 18,816.57 respectively. 20 stocks were seen advancing while 10 stocks were declining on the index (Provisional)

The BSE Mid-cap index was up by 0.60% while Small-cap index was up 0.86%. (Provisional)

On the BSE Sectoral front, Oil & Gas was up by 1.06%, PSU was up 0.69%, FMCG was up 0.63%, Health Care up by 0.54% and Capital Goods was up 0.53% were the top gainers, while Auto down by 0.44%, Consumer Durables down by 0.41%, IT down by 0.34%, TECk down by 0.29% and Bankex down by 0.10% were the top losers in the space.

The top gainers on the Sensex were Dr. Reddy’s Lab was up 2.53%, HUL up 2.49%, Coal India up by 2.15%, Hindalco Industries up 1.55% and Reliance Industries up 1.49%, while, Jindal Steel down by 4.74%, Hero MotoCorp down by 1.70%, Bajaj Auto down by 1.63%, Infosys down by 1.19% and ITC down by 0.90% were the top losers in the index. (Provisional)

Meanwhile, the twin factors- dwindling global demand and delayed monsoon that have exacerbated India’s recent economic slowdown, have now led to reduced growth forecasts by the Asian Development Bank (ADB) for fiscal years 2012 and 2013. In its  report “Asian Development Outlook 2012 Update”, ADB lowering its projection, has pegged India’s gross domestic product to grow by 5.6% in FY2012 (which ends March 2013) and 6.7% in FY2013, from earlier projections of 7.0% and 7.5%, respectively, for the two years. Besides this, the report has also raised projected inflation to 8.2% in FY2012 (from 7.0%) on the back of higher domestic food and fuel prices.

Additionally, the report has blamed tight monetary policy to counter persistently high inflation and a high deficit for having left little room for policy to stimulate growth. Further, the report has mainly highlighted ongoing sovereign debt crisis in the euro area and looming fiscal cliff in the US to have disastrous spillovers to the rest of the world, particularly developing Asia.

However, the Manila-based bank, in its reports, has suggested the region to start reversing this trend by improving investment climate and expediting reforms, which off lately seems to be a top priority for the government, has made some headway in addressing these challenges recently. In its latest reform drive, a long needed but politically controversial decision to permit foreign direct investment (FDI) in multi-brand retail stores has been cleared, diesel prices have been hiked by 12%, use of subsidized liquefied petroleum gas has been capped to contain the fiscal deficit and lastly a controversial proposal to review tax avoidance on foreign investments has been deferred by three years.

India VIX, a gauge for markets short term expectation of volatility gained 0.97% at 16.50 from its previous close of 16.34 on Monday. (Provisional)

The S&P CNX Nifty gained 14.50 points or 0.25% to settle at 5,733.30. The index touched high and low of 5,743.25 and 5,715.80 respectively. 25 stocks advanced against 25 declining ones on the index. (Provisional)

The top gainers on the Nifty were IDFC was up 4.49%, Siemens up 3.69%, Ambuja Cement up 3.20%, HUL up 2.55% and Dr. Reddy’s Lab was up 2.52%. On the other hand, Jindal Steel down 4.79%, Power Grid down by 1.96%, Hero MotoCorp down by 1.68%, Bajaj Auto down by 1.63% and Axis Bank down 1.57% were the top losers. (Provisional)

The European markets were trading on a mixed note with, France’s CAC 40 down 0.02%, Germany’s DAX up 0.30% and the United Kingdom’s FTSE 100 up 0.14%.

Asian Markets ended mostly lower on Wednesday on the back of continued worries over the timing of a bailout for Spain and downbeat data from China turned investors cautious.  However, Hong Kong’s market ended with some gains as they resumed trading following a long weekend. Chinese telecom stocks gains also helped Hang Seng shares to hold gains. Japanese stocks ended with red mark as the auto makers turned lower. Markets in China and Korea are closed today for holidays.