Indian equities exhibit volatile trade

Indian markets are exhibiting a volatile trend in the late morning session of trade. On the global front, most of the Asian counters were trading in the green at this point of time on hopes of growth recovery in Asia after minutes of Bank of Japan monetary policy hinted towards further easing, supported the market sentiments. Back home, the traders were seen piling up position in Auto, HC and ICICI Bank while selling was seen in Consumer Durables, Oil & Gas and IT sector. Aurobindo Pharma gained after the company stated that it has received final approvals from USFDA to manufacture and market Nafcillin Injections in the United States. Shares of Binani Industries were trading under pressure despite receiving board’s approval to divest up to 40 per cent in its cement subsidiary. Grounded carrier Kingfisher Airlines edged lower after the aviation minister stated that Kingfisher Airlines has no clear funding proposal. The NSE Nifty and BSE Sensex were managing to hold their psychological 5,900 and 19400 levels respectively. The market breadth on BSE was positive, in the ratio of 1081:917.

The BSE Sensex is currently trading at 19427.90 up by 10.44 points or 0.05% after trading in a range of 19504.40 and 19415.47. There were 15 stocks advancing against 15 declines on the index.

The broader indices were trading on mixed note; the BSE Mid cap index was up by 0.23% and Small cap index was down by 0.04%.

The top gaining sectoral indices on the BSE were, Auto up by 0.74%, HC up by 0.57%, Metal up by 0.33%, Power up by 0.28% and Realty up by 0.24%. While, Consumer Durables down by 0.29%, Oil & Gas down by 0.19%, IT down by 0.18% and Capital Goods down by 0.09% were the top losers on the index.

The top gainers on the Sensex were Tata Motors up by 1.92%, Tata Steel up by 1.20%, Maruti Suzuki up by 1.18%, NTPC up by 0.74% and Hindalco Industries up by 0.70%.

On the flip side, Coal India was down by 1.01%, BHEL was down by 0.39%, ICICI Bank was down by 0.37%, Hindustan Unilever was down by 0.35%, and Wipro was down by 0.34% were the top losers on the Sensex.

Meanwhile, to boost the declining exports and bring down the surging trade account deficit, the government announced a slew of measures to boost exports. Among the incentives include extension of 2% interest subsidy for one more year till March 2014 and additional incentive on incremental exports, which would be made during January-March 2013 over the base period January-March 2012. However, it would not include deemed exports, service exports, third party exports, export-turnover of SEZ units etc. The government has also decided to introduce a pilot scheme of 2% interest subsidy for project exports through EXIM Bank for countries of SAARC region, Africa and Myanmar.

Commerce and Industry Minister Anand Sharma said, ‘with these incentives, we will be able to give a push to exports in the last quarter of this fiscal. The objective is to stabilize the situation and move from negative territory to positive and keep the trade deficit in control.’

Further, the government is also extending the period of interest subvention on certain specific sectors like handicrafts, carpets, handloom sports goods and toys among others. By adding further, Sharma said, all these sectors are directly linked to job-creation. Moreover, government’s efforts for market diversification to Africa, the ASEAN and South Amercias have paid dividends with the trade touching $65 billion.

Five new countries, New Zealand, Cayman Islands, Latvia, Lithuania and Bulgaria have been added under the Focus Market Scheme (FMS), while Eritrea has been added under the Special Focus Market Scheme. Under FMS Duty Credit of 3 per cent is given on the FoB value of exports, while under special FMS the Duty Credit is 4 per cent. Further, sixty new products and three countries, Taiwan, Thailand and Czech Republic have been incorporated under the Market Linked Focus Product Scheme.

The government had set an export target of $360 billion for 2012-13. Due to slowdown in major markets such as the US and Euro zone, exports during the April-November period this year contracted by 5.95% to $189.2 billion. Imports stood at $318.7 billion as compared to $324 billion in the last fiscal. The trade deficit for April-November 2012 stood at $129.5 billion compared to $122.6 billion in the same period a year ago. The S&P CNX Nifty is currently trading at 5,906.20 up by 0.60 points or 0.01% after trading in a range of 5,930.80 and 5,904.15. There were 26 stocks advancing against 24 declines on the index.

The top gainers of the Nifty were Tata Motors up by 1.70%, Lupin up by 1.66%, Axis Bank up by 1.19%, Maruti Suzuki up by 1.15% and Tata Steel up by 1.14%.

On the flip side, Coal India down by 0.97%, Cairn down by 0.72%, DLF down by 0.66%, Ultra Tech Cement down by 0.50%, and Wipro down by 0.44%, were the major losers on the index.

Most of the Asian equity indices were trading in green; Hang Seng surged 91.40 points or 0.41% to 22,632.58, Jakarta Composite rose 7.07 points or 0.17% to 4,282.17, KLSE Composite added 2.45 points or 0.15% to 1,674.03, Nikkei 225 soared 109.09 points or 1.07% to 10,339.45, Straits Times strengthened 9.91 points or 0.31% to 3,190.72 and Taiwan Weighted was up by 2.24 points or 0.03% to 7,636.43.

On the flip side, Shanghai Composite declined 2.58 points or 0.12% to 2,216.55 and KOSPI Composite was down by 4.47 points or 0.23% to 1,977.78.