Sensex, Nifty continue to trade in red

Indian equities continued its lackluster trade in red in a narrow range in the late afternoon session on account of selling in frontline counters and taking cues from subdued European counterparts. The sentiment was on pessimistic note on fading hopes of a last-minute compromise deal between US politicians to avert the fiscal cliff. Traders were seen piling some position in Realty, PSU and Consumer Durables sector while selling was witnessed in Capital Goods, Health Care and FMCG sectors. In the scrip specific development, Shriram Transport Finance was trading firm on reports that the Piramal Group is in advanced talks to buy US private equity firm TPG Capital’s 20.27% stake in the company for around Rs 3,500 crore. Bharti Infratel was trading in green after FTSE stated that it would include the mobile tower company to its large cap index starting on January 07. Punjab Chemicals & Crop Protection is trading in green after it received its EGM approval to refer the case of the company to Board for Industrial and Financial Reconstruction (BIFR). Hindustan Petroleum Corporation (HPCL) is trading under pressure after foreign brokerage firm Goldman Sachs gave a sell report on the company. Petronet LNG is trading in red after research firm Daiwa downgraded the stock.

On the global front, Asian markets were trading in red barring Shanghai Composite while the European markets were trading on a mixed note. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 5,950 and 19,500 levels respectively. The market breadth on BSE was positive in the ratio of 1486:1218 while 127 scrips remain unchanged.

The BSE Sensex is currently trading at 19,428.24, down by 16.60 points or 0.09% after trading in a range of 19,491.58 and 19,409.05. There were 18 stocks advancing against 12 declines on the index.

The broader indices were however trading in green; the BSE Mid cap and Small cap indices were trading higher by 0.22% and 0.47% respectively.

The top gaining sectoral indices on the BSE were, Realty up by 1.18%, PSU up by 0.62%, Consumer Durables up by 0.62%, Metal up by 0.51% and Auto up by 0.35%. On the flip side, Capital Goods down by 0.34%, Health Care down by 0.24%, FMCG down by 0.20%, TECk down by 0.10% and IT down by 0.09% were the only losers on the sectoral space.

The top gainers on the Sensex were Wipro up by 1.35%, Hindalco Industries up by 0.97%, Jindal Steel up by 0.93%, Tata Motors up by 0.89% and Tata Power up by 0.87%.

On the flip side, ITC down by 0.76%, L&T down by 0.68%, HDFC down by 0.62%, Cipla was down by 0.61% and TCS was down by 0.49% were the top losers on the Sensex.

Meanwhile, similar to the case of conventional power, the ministry of new and renewable energy wants to make procurement of electricity from renewable sources also via competitive bidding process. The Ministry has formulated the guidelines and standard bidding documents for tariff-based competitive bidding process for grid connected renewable energy power projects and has recommended them to the ministry of power for notification.

As per the ministry, the provisions of these guidelines would be compulsory for electricity distribution companies and any deviation from the guidelines would have to be got approved by the respective state electricity regulatory commission. The procurement of power from solar sources is already under competitive bidding.

However, wind industry has opposed these guidelines. Secretary of the Indian Wind Turbine Manufacturer’s Association D V Giri said that it is not the good time to bring in competitive bidding for the wind industry and the association has sent a petition to MNRE to seek removal of the applicability of the guidelines to the wind industry. While, Tamil Nadu Spinning Mills Association, whose members own about 3,000 MW of wind power capacity, has also opposed the guidelines. According to the Tamil Nadu association, wind power tariff cannot be determined on competitive bidding basis.

The Indian wind industry is already in trouble and its two major incentives like generation-based incentive and accelerated depreciation have been withdrawn from the beginning of the year. The industry is further suffering from non-settlement of dues by the state’s distribution company, TANGEDCO and non availability of the grid during windy periods. Due to these issues, the wind power addition in 2012-13 is expected to be about half of last year’s 3,170 MW.

The S&P CNX Nifty is currently trading at 5,902.35, down by 6.00 points or 0.10% after trading in a range of 5,919.00 and 5,897.15. There were 30 stocks advancing against 18 declines while 2 stocks remain unchanged on the index.

The top gainers of the Nifty were Punjab National Bank up by 3.11%, DLF up by 2.51%, ACC up by 1.72%, Bank of Baroda up by 1.32% and Wipro up by 1.19%.

On the flip side, HCL Tech down by 1.17%, TCS down by 0.90%, ITC down by 0.86%, L&T down by 0.85% and HDFC down by 0.77% were the major losers on the index.

Most of the Asian equity indices were trading in red; Hang Seng down by 0.04%, Straits Times was down by 0.77% and KLSE Composite down by 0.21%. On the flip side, Shanghai Composite up by 1.61% was the sole gainer amongst Asian pack.

Indonesia, Japan, South Korea and Taiwan markets remained closed for trade today on the account of public holiday.

The European markets were trading on a mixed note with, France’s CAC 40 up 0.14% and United Kingdom’s FTSE 100 down by 0.40% while Germany’s DAX was closed for the day.