Indian equities continue firm trade; CD, Auto and Realty supports

Indian equities added gains to continue its firm trade in the late afternoon session on back of buying in frontline counters. The market sentiments were in a positive mood after India’s manufacturing activity growth inched up in October from September's 10-month low, on account of a pick-up in new orders and an easing of price pressures. Traders were seen piling some position in Consumer Durables (CD), Auto and Realty sector while selling was witnessed in FMCG and Oil & Gas sector. Telecom stocks were trading firm ahead of Empowered Group of Ministers (EGoM) meet scheduled later in the evening to consider the recommendations of Telecom Commission on spectrum re-farming, which calls for existing operators to vacate their spectrum and buy less-efficient airwaves in different band. In the scrip specific development, industry heavyweight Reliance Industries was trading under pressure after anti-corruption activist-turned-politician Arvind Kejriwal made allegations against the company of receiving undue favours from the government over a contract to develop natural gas fields. Maruti Suzuki India, TVS Motor Company and Steel Strips Wheels were trading in green on reporting encouraging sales number for month of October.

On the global front, Asian markets were trading mixed while the European markets were too trading on a mixed note. Euro zone finance ministers are to hold a conference call and the focus is on Greece. The leaders will have to make a decision on disbursing the next tranche of the €31.5 billion bailout money for Greece. The euro area unemployment rate increased to a record 11.6% in September from a revised 11.5% in August, as per the Eurostat. The EU27 jobless rate remained stable at 10.6%. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 5,600 and 18,500 levels respectively. The market breadth on BSE was positive in the ratio of 1486:1144 while 118 scrips remain unchanged.

The BSE Sensex is currently trading at 18,545.75, up by 40.37 points or 0.22% after trading in a range of 18,566.60 and 18,445.18. There were 17 stocks advancing against 13 declines on the index.

The broader indices too added ground; the BSE Mid cap and Small cap indices were trading up by 0.75% and 0.54% respectively. The top gaining sectoral indices on the BSE were, Consumer Durables up by 5.11%, Auto up by 1.83%, Realty up by 1.25%, Health Care up by 0.90% and Power up by 0.83%. While, FMCG down by 0.81% and Oil and Gas down by 0.62% were the only losers on the index.

The top gainers on the Sensex were Tata Motors up by 4.83%, Bharti Airtel up by 4.11%, Wipro up by 3.88%, Cipla up by 3.07% and Hero MotoCorp up by 1.57%.

On the flip side, HUL down by 1.95%, ONGC down by 1.64%, ITC down by 1.33%, Gail India down by 0.95% and Hindalco Industries down by 0.69% were the top losers on the Sensex.

Meanwhile, Kelkar Committee's opinion that fiscal deficit will reach 6.1% for the current financial year amid slowing economic conditions, the Finance Minister P Chidambaram however, exuded confidence to contain fiscal deficit to the envisaged figure 5.3%, even though he admitted that it is a challenging task. He also sought support from the political parties to deal with the economic and financial problems faced by the nation, while confirming that the centre will do its best to maximize revenue collection and to cut down expenditure for restricting fiscal deficit.

In the financial budget, the government had proposed to trim down the fiscal deficit in 2012-13 to 5.1% from 5.8% in the last financial year; it is expected to shoot up on account of various global and domestic factors. However, the consultative committee comprising MPs has reminded the minister to ensure that the measures to contain the deficit should not harm the common man. Reasoning that to curtail deficit of the country, the centre had earlier raised diesel prices by Rs 5 a litre and capped subsidized LPG cylinders at 6 a family in a year. Meanwhile, the members also expressed their support on adoption of any efficient mechanism to plug the leakage of the capital.

The ministry has further promised that aggressive measures would be taken to bridge the Current Account Deficit (CAD) estimated at $70.3 billion by encouraging flow of Foreign Direct Investments (FDI) and Foreign Institutional Investments (FII). Chidambaram had come up with a five-year roadmap for fiscal consolidation, two days before, where he scaled up fiscal deficit to 5.3% of GDP as compared to estimated 5.1% in the budget (BE).  While, fiscal deficit targets for the next four financial years are projected at 4.8% of GDP by 2013-14, 4.2% by 2014-15, 3.6% by 2015-16 and 3% by 2016-17.

The S&P CNX Nifty is currently trading at 5,635.80, up by 16.10 points or 0.29% after trading in a range of 5,642.50 and 5,601.95. There were 34 stocks advancing against 16 declines on the index.

The top gainers of the Nifty were Tata Motors up by 4.89%, Bharti Airtel up by 3.99%, Wipro up by 3.89%, Cipla up by 3.29% and Reliance Infrastructure up by 2.79%.

On the flip side, HUL down by 1.87%, ONGC down by 1.81%, ITC down by 1.20%, Cairn India down by 1.03% and Gail India down by 0.90% were the major losers on the index.

Asian equity indices were trading mixed; Kospi Composite declined 0.71%, Jakarta Composite lost 0.97%, Straits Times slid 0.35%, and KLSE Composite shed 0.10% while Hang Seng added 0.83%, Shanghai Composite surged 1.72%, Taiwan Weighted gained 0.19% and Nikkei 225 up by 0.21% were the gainers.

The European markets were trading on a mixed note with, France’s CAC 40 lost 0.06%, Germany’s DAX ascended 0.21% and the United Kingdom’s FTSE 100 gained 0.26%.