Indian benchmarks have made a muted start ahead of the derivatives expiry today. On the global front, the US markets witnessed a mild pullback in last hour after a sharp selloff in last session but still ended marginally lower, while the Asian markets were trading mixed with some of the indices giving up their early gains. Chinese flash manufacturing data, showed growth declining for a 12th straight month in October, but output was at a three-month high.
Back home, Sensex continued to trade above its crucial 18,700 level while Nifty was trading near its crucial 5,700 mark as some amount of support came in from public sector oil marketing companies. Stocks of BPCL, HPCL and IOC all edged higher as US crude oil futures slipped to fresh three-month low on October 24, 2012. The sentiments also got some strength from better than expected Q2 numbers from Sterlirte Industries. The company, on consolidated basis, posted a growth of 74.66% in its net profit after taxes, minority interest and consolidated share in loss of associates at Rs 1,742.69 crore for the quarter ended September 30, 2012 as compared to Rs 997.78 crore for the same quarter in the previous year.
On the sectoral front, oil and gas witnessed the maximum gain in trade followed by metal and auto while, fast moving consumer goods, software and technology remained the top losers on the BSE sectoral space. The broader indices were outperforming benchmarks while, the market breadth on the BSE was positive; there were 988 shares on the gaining side against 607 shares on the losing side while 75 shares remain unchanged.
The BSE Sensex opened at 18,712.41; about 2 points higher compared to its previous closing of 18,710.02, and has touched a high and a low of 18,741.53 and 18,703.90 respectively.
The index is currently trading at 18,727.63, up by 17.16 points or 0.09%. There were 16 stocks advancing against 14 declines on the index.
The overall market breadth has made a positive start with 59.16% stocks advancing against 36.35% declines. The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices rose 0.14% and 0.48% respectively.
The top gaining sectoral indices on the BSE were Oil and Gas up by 0.76%, Metal up by 0.63%, Auto up by 0.37%, PSU up by 0.30% and Realty up by 0.30%. While, FMCG down by 0.35%, IT down by 0.32%, TECk down by 0.22%, HC down by 0.12% and Bankex down by 0.05% were the top losers on the index.
The top gainers on the Sensex were Sterlite Industries up by 2.79%, Bajaj Auto up by 0.99%, HDFC up by 0.98%, ONGC up by 0.98% and RIL up by 0.93%.
On the flip side, Dr Reddy was down by 0.82%, Infosys was down by 0.57%, Sun Pharma was down by 0.54%, Cipla was down by 0.51% and Jindal Steel was down by 0.49% were the top losers on the Sensex.
Meanwhile, the Reserve Bank of India (RBI) is examining whether a part of banks’ investment in government securities (SLR) can be considered for the purpose of calculating liquidity under the Basel III regulatory norms, aimed at preventing a recurrence of 2008 like financial crisis. The first sign that central bank may dilute the Basel III norms on capital and liquidity comes in backdrop of strong opposition of the banking industry.
Basel-III norms prescribe banks to build a liquidity coverage ratio. However, banks in India are already mandated to maintain the minimum liquidity at 23 per cent of net demand and time liabilities as the Statutory Liquidity Ratio (SLR) under RBI norms.
Hence, as per the central bank’s governor, Anand Sinha, redefining liquidity coverage ratio will not make a substantial change in the Indian context since banks are mandated to own 23% of their deposits in government bonds, but cannot be traded. Further, the deputy governor also pointed out the concern that banks might raise lending rates to compensate for the increase in cost of capital.
The guidelines that would come into effect in a phased manner starting January 1 next year, would have to be fully implemented by March 31, 2018. Further, Sinha underscored that, there have been studies by the Basel-III committee that the macroeconomic impact of new regulations are modest if the implementation is phased over a transition period.
The S&P CNX Nifty opened at 5,688.80; about 3 points lower compared to its previous closing of 5,691.40, and has touched a high and a low of 5,697.45 and 5,687.40 respectively.
The index is currently trading at 5,693.90, down by 2.50 points or 0.04%. There were 28 stocks advancing against 22 declines on the index.
The top gainers of the Nifty were Sesa Goa up by 1.56%, HDFC up by 1.11%, Bajaj Auto up by 1.05%, ONGC up by 0.98% and RIL up by 0.95%.
On the flip side, Dr Reddy down by 0.78%, Cipla down by 0.71%, ACC down by 0.64%, Infosys down by 0.58% and Sun Pharma down by 0.56%, were the major losers on the index.
Asian equity indices were trading mixed; Shanghai Composite was down by 4.42 points or 0.21% to 2,111.57, Hang Seng lost 16.13 points or 0.07% to 21,747.65, Kospi Composite fell by 1.20 points or 0.06% to 1,912.76 and Taiwan Weighted was down by 5.29 points or 0.07% to 7,309.59.
On the other hand, KLSE Composite was up by 1.41 points or 0.08% to 1,669.40, Jakarta Composite was marginally up by 2.88 points or 0.07% to 4,329.43, Nikkei 225 gained 53.58 points or 0.60% to 9,007.88 and Straits Times declined by 9.12 points or 0.30% to 3,053.85.
