Markets continue firm trade; rate sensitive spurts

Indian equity indices, after a bullish start, continue to hold on to their morning gains and are trading with traction supported by shares of interest rate sensitive sectors mainly banking and real estate which remained on buyers radar on optimism of Reserve Bank of India (RBI) easing monetary policy this month. Rally in metal counter too supported the sentiments as stocks like Hindalco, Jindal Steel, Tata Steel, Sterlite Industries and Sesa Goa edged higher on upbeat Chinese manufacturing data from HSBC. Global cues too remained supportive as US stock market surged overnight even as the fiscal cliff neared. Republicans and Democrats didn’t reach a budget compromise till the end of trading session, however, investors were betting that they would. On the regional front, all the major Asian markets are closed today on account of New Year.

Back home, all the sectoral indices opened higher with the Realty, Metal, Consumer Durables Banking and Capital Goods leading the opening gains with over 1 per cent gains. Power, PSU, Auto and Healthcare indices were the other notable index movers in the opening trades while, there were no losers on the BSE sectoral index. The broader indices were trading in-line with benchmarks while, the market breadth on BSE was positive, in the ratio of 1517: 612.

Among the individual stocks, Unitech, Bombay Dyeing and Indiabulls Real Estate from realty and State Bank of India, Canara Bank and Bank of India from banking are trading higher by 2-3 per cent. Among other names, Tulip Telecom was locked in 5 per cent upper circuit of Rs 34.20 on the NSE after its board approved long term debt-restructuring plans.

The BSE Sensex is currently trading at 19564.45 up by 137.74 points or 0.71% after trading in a range of 19588.46 and 19508.93. There were 27 stocks advancing against 3 declines on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.92% and Small cap index was up by 0.86%.

The top gaining sectoral indices on the BSE were, Realty up by 1.61%, Metal up by 1.27%, Consumer Durables up by 1.19%, Capital Goods up by 1.08% and Bankex up by 1.03%. While, there were the no losers on the index.

The top gainers on the Sensex were Jindal Steel up by 1.89%, Hindalco Industries up by 1.84%, SBI up by 1.73%, L&T up by 1.35%, and Sterlite Industries up by 1.33%.

On the flip side, Wipro was down by 0.43%, Dr Reddy’s Lab was down by 0.41%, and ONGC was down by 0.04% were the top losers on the Sensex.

Meanwhile, growth rate of eight core sector industries declined to 1.8 per cent in November 2012, from 7.8 per cent in the same month last year, mainly due to contraction in production of natural gas, coal and cement. During April-November 2012-13, the cumulative growth rate of the core industries was 3.5% as against 4.8% recorded during the corresponding period in 2011-12.  Petroleum refinery production with a weight of 5.94% in IIP index grew by 6.6% in November 2012 compared to its growth at 11.2% in November 2011. On collective basis, it registered a growth of 7.2% during April-November 2012-13 compared to 4.4% growth during the same period of 2011-12.

Crude oil, which occupies 5.22% weight age in index registered marginal growth of growth 0.8% in reporting month compared to a negative growth of 5.7% in November 2011. Cumulatively, Crude Oil production recorded a negative growth of 0.5% during April-November 2012-13 compared to its growth at 2.9% during the same period of 2011-12. Moreover, fertilizer production with a weight of 1.25% registered a growth of 5.0% in November 2012 against its negative growth at 6.7% in November 2011. While in cumulative terms, it registered a negative growth of 3.3% during April-November 2012-13 compared to a contraction of 0.7% during the same period of 2011-12.

Furthermore, Steel production along with the electricity generation with weight 6.68% and 10.32% registered growth 6.0% and 2.3% in month under review against its 10.5% and 14.4% growth in November 2011. Cumulatively, Steel production registered 3.4% growth during April-November 2012-13 compared to its 8.9% growth during the same period of 2011-12. Cumulative growth of Electricity generation was 4.6% during April-November 2012-13 compared to its 9.4% growth during the same period of 2011-12.

On the flip side, Coal production with a weight of 4.38% in the index, registered a de-growth of 4.4% in November 2012 compared to its positive growth at 4.9% in November 2011. Coal production recorded a growth of 6.7% during April-November 2012-13 compared to its negative growth at 4.0% during the same period of 2011-12.

Cement and natural gas, which occupies 2.41% and 1.71% weight age in index have also registered negative growth of 0.2% and 15.2% in November 2012 compared to their growth of 17.0% and (-) 10.1% in November. Cumulatively, cement and natural gas production recorded growth of 6.7% and (-) 13.1% during April-November 2012-13 compared to its growth at 4.8% and (-) 8.5% during the same period of 2011-12.

The growth of eight core sectors slipped to four-month low of 1.8 percent in November reflecting the economic slowdown.  The decline in core sector growth in November, 2012 was on account of negative growth registered in the production of coal, natural gas and cement and deceleration in growth rates of electricity, steel and petroleum refinery products. Contraction in growth of core sectors will have the implications on industrial production data for November to be released later next month.

The S&P CNX Nifty is currently trading at 5,945.65 up by 40.55 points or 0.69% after trading in a range of 5,952.30 and 5,935.20. There were 44 stocks advancing against 6 declines on the index.

The top gainers of the Nifty were Reliance Infrastructure up by 3.21%, JP Associates up by 1.90%, Hindalco Industries up by 1.92%, Jindal Steel up by 1.75% and SBI up by 1.73%.

On the flip side, Wipro down by 0.39%, Dr Reddys Lab down by 0.37%, ONGC down by 0.32%, Asian Paint down by 0.18% and Hero Moto Corp down by 0.08%, were the major losers on the index.

All the major Asian markets remained closed for trade today on account of the New Year.