Benchmarks trade flat ahead of Infosys Q2 numbers; IIP data eyed

Indian frontline equity benchmarks have got off to a sedate start, with the BSE Sensex and the NSE Nifty struggling for direction in early minutes of trade in the absence of any positive triggers. The undercurrent in the Indian market is one of cautious optimism, as investors awaiting the next round of economic reforms from the UPA, while bracing for the latest batch of corporate results. All eyes will be on the earnings from IT titan Infosys and housing finance major HDFC on Friday. Investors will also keep an eye on the IIP data and CPI inflation, both of which will release on Oct 12.

Global cues too remained unsupportive as Standard & Poor’s cut Spain’s sovereign credit rating to BBB-minus, just above junk territory. The US markets suffered sharp cuts overnight, a day after the earnings season opened with Alcoa quarterly numbers and Chevron saying profits would fall sharply in its most recent period. Most of the Asian markets were trading in the red at this point of time, though the cuts were marginal but the report that Japanese machinery orders fell in August was weighing down the sentiments.

Back home, realty witnessed the maximum gain in trade followed by oil and gas and healthcare while, auto, capital goods and software remained the top losers on the BSE sectoral space. Meanwhile, auto stocks viz. Mahindra & Mahindra, Maruti Suzuki, TVS Motor, Hero MotoCorp and Bajaj Auto all edged lower after SIAM drastically reduced its car sales forecast to 1-3% against the previous projection of 9-11%. However, software scrips like TCS, Wipro and HCL Tech surged on a report that Indian IT spending will reach $71.5 billion in 2013, growing 7.7% from the $66.4 billion forecasted for 2012. The broader indices too remained mute while, the market breadth on the BSE was negative; there were 718 shares on the gaining side against 742 shares on the losing side while 61 shares remain unchanged.

The BSE Sensex opened at 18,627.37; about 4 points lower compared to its previous closing of 18,631.10, and has touched a high and a low of 18,670.43 and 18,591.73 respectively.

The index is currently trading at 18,635.47, up by 4.37 points or 0.02%. There were 16 stocks advancing against 14 declines on the index.

The overall market breadth has made a negative start with 47.21% stocks advancing against 48.78% declines. The broader indices too were trading near their pre-close level; the BSE Mid cap and Small cap indices rose 0.05% and 0.01% respectively.

The top gaining sectoral indices on the BSE were, Realty up by 1.39%, Oil and Gas up by 0.40%, HC up by 0.33%, Bankex up by 0.07% and Power up by 0.05%. While, Auto down by 0.35%, CG down by 0.25%, IT down by 0.17%, TECk down by 0.12% and FMCG down by 0.10% were the top losers on the index.

The top gainers on the Sensex were Bharti Airtel up by 1.01%, HDFC Bank up by 0.84%, Dr Reddy up by 0.69%, ONGC up by 0.69% and Cipla up by 0.63%.

On the flip side, Sterlite Industries was down by 0.84%, SBI was down by 0.78%, Bajaj Auto was down by 0.69%, M&M was down by 0.63% and Infosys was down by 0.61% were the top losers on the Sensex.

Meanwhile, in a respite for the fuel supply problems, Coal India (CIL) has agreed to enter into fuel supply agreements (FSAs) with power companies even if they do not have power purchase agreements (PPAs) in place. However, the power companies have to furnish PPA at the time when fuel supply from CIL started.

Union Power Minister Veerappa Moily confirmed that the Southern Grid would be connected to the National Grid by December 2013, which will ensure in providing a uniform flow of electricity across India. He also underlined that budget support for the Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY) scheme in the XII Plan has been approved by the Planning Commission as the centre had planned to add 18,000 MW during the current financial year, the estimated requirement of budget support is about Rs 49,730 crore. This is in conjunction with its efforts to set up a total of 80,000 MW capacity in the current Plan period ending March 2017.

The ministry also reaffirmed the commissioning of the first 660 MW unit of Sasan UMPP in Madhya Pradesh, which is on schedule and is expected to commence by the beginning of next year.

The S&P CNX Nifty opened at 5,663.50; about 11 points higher as compared to its previous closing of 5,652.15, and has touched a high and a low of 5,666.55 and 5,637.55 respectively.

The index is currently trading at 5,650.60, down by 1.55 points or 0.03%. There were 30 stocks advancing against 20 declines on the index.

The top gainers of the Nifty were DLF up by 1.60%, Siemens up by 0.88%, ONGC up by 0.87%, Bharti Airtel up by 0.86% and HDFC Bank up by 0.82%.

On the flip side, IDFC down by 1.09%, Axis Bank down by 1.03%, Bajaj Auto down by 0.75%, L&T down by 0.71% and Bank of Baroda down by 0.68%, were the major losers on the index.

Most of the Asian equity indices were trading in the red; Shanghai Composite was down by 10.12 points or 0.48% to 2,109.82, Jakarta Composite was marginally down by 7.41 points or 0.21% to 4,269.06, KLSE Composite declined by 3.28 points or 0.20% to 1,656.06, Nikkei 225 dropped 16.88 points or 0.20% to 8,579.37, Straits Times lost 5.60 points or 0.19% to 3,028.94, Kospi Composite was lower by 6.47 points or 0.36% to 1,941.88 and Taiwan Weighted plunged by 115.52 points or 1.53% to 7,475.82.

Hang Seng was the lone gainer, up by 54.48 points or 0.26% to 20,974.08.