Benchmarks pare early gains; slid to intra-day low

Benchmark equity indices, erasing almost major portion of early gains, have slid to intra-day’s low, as higher prices of equities enticed some sellers. Intense profit-booking in Realty, Information Technology and Consumer Durable stocks, mainly vapor up substantial gains of the bourses. On the flip side, Fast Moving Consumer Goods, Auto and Public Sector Undertaking (PSU) counters, showcasing resilience, are driving the positive mood of Indian equity markets. In the choppy session of trade, 30 share barometer index, Sensex, hanging on with slender gains, is trading above 18300 psychological level. Similarly, widely followed index, Nifty, too keeping its head above the water, is trading sub 5600 crucial bastion. Broader indices, meanwhile, have slid into negative terrain.

On the global front, European stock index futures, are pointing to slightly lower open on Tuesday, pausing after the biggest daily gain in 10 weeks, with a downgrade of France's credit rating capping sentiment. Moody's Investors Service has cut France's government bond rating by one notch from Aaa to Aa1. On the other hand, Asian pacific shares mostly rose on hopes of a compromise in the U.S. fiscal crisis, even after Moody's Investors Service scrapping France's top-notch credit rating, reminded investors of the downside risk from the euro zone debt woes.

Closer home, shares in gold finance companies, namely, Manappuram Finance and Muthoot Finance fell on Tuesday after the Reserve Bank of India, in a bid to dissuade people from indulging in speculative activity banned banks from advancing any loans to its customers for purchasing gold in any form, which includes primary gold, gold bullion, gold jewellery, gold coins, units of gold Exchange Traded Funds (ETF) and units of gold mutual funds. In stock specific action, United Spirits stock gained after Diageo announced open offer to acquire a 26 per cent stake in Indian peer United Spirits for Rs 1,440 per share. The overall market breadth on BSE in the favor of declines which have piped advances in the ratio of 1471:1091, while 131 shares remained unchanged.

The BSE Sensex is currently trading at 18358.65, up by 19.65 points or 0.11%. There were 17 stocks advancing against only 13 declines on the index.

The broader indices have slipped into red terrain; the BSE Mid cap and Small cap indices down by 0.13% and 0.02% respectively. The top gaining sectoral index on the BSE was FMCG up by 0.59%, Auto up by 0.13% and Power up by 0.05%. While, IT down by 0.75%, TECk down by 0.63% ,Realty down by 0.43%, CD down by 0.40% and CG down by 0.29% were top losers on the index

The top gainers on the Sensex were HDFC up by 2.25%, Mahindra & Mahindra up by 1.29%, Gail India up by 1.08%, Tata Motors up by 0.98% and Wipro up by 0.77%. While, Infosys down by 1.82%, Sun Pharmaceuticals down by 1.26%, Hero MotoCorp  down by 0.95%, Bajaj Auto down by 0.76% and Hindalco Inds down by 0.74% were the top losers on the Sensex.

Meanwhile, India is all set to conclude the Free Trade Agreement (FTA) in services and investment with Association of South East Asian Nations (ASEAN) by next month, which will send a strong signal of deepening economic engagement and further allow for rapid expansion in trade and investment flows in both directions. Prime Minister Manmohan Singh while addressing India-ASEAN summit, invited investments from the 10-nation ASEAN into India and also highlighted the steps taken by India to improve investment environment.

The FTA in services and investment were delayed due to strong differences between the two sides. However, Singh is optimistic on the conclusion of the agreement on trade in services and investments, together with existing agreement on trade in goods, which will be a launch pad for rapid expansion in economic relations with the ASEAN. By adding further he said, India’s relationship with the ASEAN continues to expand in all magnitude, with commerce and connectivity being crucial areas of this relationship in which good progress has been made.

Further, referring to the India-ASEAN FTA on trade in goods signed in 2009, Singh said that it has served well, with the two-way commerce increasing to nearly $80 billion in the Indian financial year ending March 2012, exceeding the target of $70 billion. However, India would offer its own resources, expertise and experience to support growth and development in ASEAN countries, where such needs exist.

The S&P CNX Nifty is currently trading at 5,578.55, higher by 7.15 points or 0.13%. There were 25 stocks advancing against 24 stock declines while 1 remains unchanged on the index.

The top gainers of the Nifty were HDFC up by 2.41%, PowerGrid up by 1.37%, Mahindra & Mahindra up by 1.34%, IDFC up by 1.10% and Gail up by 1.01%. On the flip side, Infosys down by 1.87%, Sun Pharmaceuticals down by 1.16%, HCL Tech down by 1.14%, Hero MotoCorp down by 1.11% and Reliance Infra down by 1.05% remained top losers on the index.

Most of  the Asian equity indices were trading mostly in green; Hang Seng up by 0.79%, Straits Times was up by 0.40%, Kospi Composite up by 0.64%, Taiwan Weighted up by 0.23%, KLSE Composite up by 0.15 %  were the gainers amongst Asian pack.

On the flip side, Nikkei 225 down by 0.12%, Shanghai Composite declined 0.53%, Jakarta Composite down by 0.06% were trading in red.