Benchmark equity indices enlarge losses; broader indices add ground

Benchmark equity indices have enlarged their losses after last week’s frenzied rally enticing sellers, activated the snoozing bears, thereby leading a downtrend at D-street. Qualms over decision on whether foreign supermarket chains such as Wal-Mart Stores set up shop, via a vote, could pave the way for further measures to revive the economy, mainly has plagued the sentiment of Indian equity markets, with Parliament being adjourned for the day on Monday after paying tributes to former prime minister Inder Kumar Gujral, who breathed his last on Friday at the age of 92. Shrugging of the positive macro-reports, market-men have started squaring off their positive tracing somber Asian market cues.

On the macro-font, indicating further improvement in the health of the Indian manufacturing sector, the seasonally adjusted HSBC Purchasing Managers’ Index, a composite indicator of operating conditions in the manufacturing economy posted a good advancement in November, surging to their five-month high to 53.7 from 52.9 in October.

On the global front, Asian shares were trading mostly in red Monday after worries that stagnant US budget talks could threaten to derail the world's largest economy eclipsed signs of a stabilizing Chinese economy. European stock futures rose as a measure of Chinese manufacturing increased and Greece prepared to open bids to repurchase bonds issued earlier this year.

Closer home, Realty, Metal and Power counters, lured maximum investor’s interest, while Consumer Durables, Bankex and Fast Moving Consumer Goods counters emerged as the top laggards on BSE sectoral front. In other sector-specific activity, telecom stocks were mostly lower on profit booking after recent gains, while Capital goods stocks gained on fresh buying. Meanwhile, Auto stocks too were in limelight after reporting November Sales figures, Mahindra & Mahindra (M&M) gained 1.50% on reporting 18% growth in November sales. Additionally, Small car maker Maruti Suzuki India too advanced over 1% on reporting 12.45% increase in total sales for November at 103200 units as against 91772 units in the same month last year. The overall market breadth on BSE is in the favour of advances which are outnumbering declines in the ratio of 1272:620, while 25 shares remained unchanged.

The BSE Sensex is currently trading at 19292.89 down by 47.01 points or 0.24% after trading in a range of 19416.45 and 19273.03. There were 14 stocks advancing against 16 declines on the index.

The broader indices, conversely, added some ground; the BSE Mid cap index was up by 1.01% and Small cap index was up by 0.94%.

The top gaining sectoral indices on the BSE were, Realty up by 1.45%, Metal up by 0.68%, Power up by 0.58%, Auto up by 0.46% and Capital Goods (CG) up by 0.42%, while Consumer Durables down by 0.83%, Bankex down by 0.52%, FMCG down by 0.27%, TECk down 0.20% and IT down by 0.09% were the top losers on the index.

The top gainers on the Sensex were BHEL up by 2.19%, Mahindra & Mahindra up by 1.73%, Tata Steel up by 1.49%, Maruti Suzuki up by 1.46% and Jindal Steel up by 1.34%.

On the flip side, HDFC Bank down by 2.27%, Bharti Airtel down by 1.23%, ITC down by 0.91%, NTPC down by 0.71% and HDFC down by 0.62% were the top losers on the Sensex.

Meanwhile, the Union Cabinet is likely decide on the proposal to set up a National Investment Board (NIB) this week, that would focus on decisions of approval/clearances of projects with investment of Rs 1,000 crore and above. This development comes at a time when the World Bank, in its report ‘Doing Business 2013’, has ranked India 132 in the list of 185 countries. In its report, India is placed far behind then other low economy developing countries.

The proposal is high on the agenda of the government, it is expected that the Cabinet in its next meeting may take a call on this.  The proposed body will be a Cabinet Committee with the Prime Minister as the Chairman. Currently, many large projects, particularly those related to infrastructure in public and private sectors, have been held up on account of inordinate delays in obtaining necessary approvals from various Central Ministries or Departments.

With this NIB, the government aims to facilitate and ensure accelerated and time bound grant of various licenses’ permissions and approvals as the NIB mechanism will be triggered in case of the failure of the competent authorities to act in time. Further, the NIB would be an equivalent to a Cabinet Committee on Investments (CCI) and it will not in any way be a substitute to the existing Foreign Investment Promotion Board (FIPB).

Moreover, all the powers of CCI then would be transferred to the Cabinet Committee on Economic Affairs (CCEA) except for those projects notified under the proposed NIB. Further, the final name for the proposed mechanism has been left to the Cabinet to decide.

The S&P CNX Nifty is currently trading at 5,866.75, down by 13.10 points or 0.22% after trading in a range of 5,899.15 and 5,859.70. There were 23 stocks advancing against 27 declines on the index.

The top gainers of the Nifty were ACC up by 3.32%, UltraTech Cement up by 3.01%, JP Associates up by 1.98%, BHEL up by 1.86% and M&M up by 1.56%.

On the flip side, IDFC down by 2.31%, HDFC Bank down by 2.30%, BPCL down by 1.40%, Bharti Airtel down by 1.31% and Kotak Bank down 1.02% were the top losers on the Nifty.

Asian equity indices were trading mostly in red; Taiwan Weighted gained 0.26%, Nikkei 225 added 0.13%, Seoul Composite advances 0.26%. On the other hand, Hang Seng declined 0.82%, Shanghai Composite slid 0.66%, KLSE Composite descended 0.20%, Jakarta Composite dipped 0.18% and   Straits Times was down by 0.04%.