Indian equities trim losses; trade continues in red

Indian equities pare losses but continued its weak trade below neutral line in the late afternoon session. Traders were seen piling some position in Auto, Realty and FMCG sector while selling was witnessed in Capital Goods, Oil & Gas and Power sector. Telecom stock were seen trading in green after Union Cabinet headed by Prime Minister Manmohan Singh, accepting the recommendations of Empowered Group of Ministers, approved levy of one-time spectrum charge on all existing telecom operators. PSU oil marketing companies like HPCL, BPCL and IOC were trading in green as crude oil prices dropped sharply. In the scrip specific development, United Spirits was trading firm on reports that the Indian liquor maker is expected to meet Diageo to continue discussing a potential stake sale.

On the global front, most of Asian markets were trading in red while the European markets were trading on optimistic note. The Greek parliament passed a fresh round of austerity measures, with the governing coalition securing at least 151 votes. The country was required by its institutional lenders to pass 13.5 billion euros ($17.2 billion) of extra cuts before receiving 31 billion euros of additional financial aid. Separately, the European Commission forecast a 0.3% decline in economic activity in the European Union this year, and subdued growth in 2013. The euro zone economy is expected to contract 0.4% this year, and will be stagnating in 2013. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 5,750 and 18,900 levels respectively. The market breadth on BSE was negative in the ratio of 1197:1447 while 144 scrips remain unchanged.

The BSE Sensex is currently trading at 18,835.98, down by 66.43 points or 0.35% after trading in a range of 18,865.21 and 18,736.45. There were 8 stocks advancing against 21 declines while 1 stock remains unchanged on the index.

The broader indices were trading on a mixed note; the BSE Mid cap was up by 0.01% and Small cap indices were trading lower by 0.10% respectively.

The gaining sectoral indices on the BSE were, Auto up by 0.90%, Realty up by 0.55%, FMCG up by 0.47%, Consumer Durables up by 0.13% and PSU up by 0.11%. On the flip side, Capital Goods down by 1.19%, Oil & Gas down by 0.74%, Power down by 0.70%, IT down by 0.51%, and Health Care down by 0.32% were the top losers on the index.

The top gainers on the Sensex were Tata Motors up by 4.79%, SBI up by 2.06%, Bharti Airtel up by 1.38%, Sun Pharma up by 1.13% and Wipro up by 0.68%.

On the flip side, GAIL India down by 2.49%, Tata Power down by 2.36%, L&T down by 1.85%, ICICI Bank down by 1.40% and Infosys was down by 1.05% were the top losers on the Sensex.

Meanwhile, amid stringent availability of fuel, the Planning Commission deputy chairman Montek Singh Ahluwalia has urged for a speedy resolution on pooling price of domestic and imported coal and gas to avail the feed stock for power plants at a reasonable rate.

The directive will average out the domestic fuel prices with expensive imported fuel to make it reasonable for the fuel-starved power plants in India. He also noted that the biggest problem in the short term or 2-3 years is fuel supply and stressed on the need to garner more investments into the power sector.

Montek stressed that the non-performance of power sector has a ripple effect on banks and financial institutions, while noting that the financing by banks in either generation or transmission requires having viability of the operation on the basis of the quality of the entrepreneur on project management skills to avoid the risk born by the institution.

He also pitched for proper implementation of Electricity Regulation Act and urged to promote larger number of consumers of power to enter into purchase agreements to trigger the sector.

The S&P CNX Nifty is currently trading at 5,734.00, down by 26.10 points or 0.45% after trading in a range of 5,742.50 and 5,693.95. There were 15 stocks advancing against 35 declines on the index.

The top gainers of the Nifty were Tata Motors up by 4.88%, SBI up by 1.98%, Asian Paints up 1.44%, Bharti Airtel up by 1.44% and Sun Pharma up by 1.37%.

On the flip side, GAIL down by 2.42%, Tata Power down by 2.22%, L&T down by 2.04%, Reliance Infrastructure down by 1.61% and Lupin down by 1.59% were the major losers on the index.

All the Asian equity indices were trading in the red; Kospi Composite plunged 1.19%, Taiwan Weighted lost 0.61%, Jakarta Composite declined by 0.85%, Straits Times plunged 1.17%, KLSE Composite slid 0.45%, Hang Seng plummeted 2.41%, Nikkei 225 descended 1.51% and Shanghai Composite shed 1.63%.

The European markets were trading in green with, France’s CAC 40 gained 0.67%, Germany’s DAX added 0.29% and the United Kingdom’s FTSE 100 ascended 0.25%.