Buying in late hour help benchmarks to keep their head above water

Key domestic benchmark witnessed another day of consolidation with both the frontline indices managed to keep their head above water on last trading day of the week. Buying which emerged in late trade, largely supported by rally in oil companies, mainly acted as saving grace for domestic equity markets. PSU oil marketing companies viz. BPCL, HPCL and IOC edged higher on reports that the petroleum ministry has proposed a gradual rise in diesel prices, by 1 rupee a litre every month over a 10-month period. The local gauges pulled back after breaching below 19,700 (Sensex) as investors continued piling up positions in software and technology stocks on hopes of better third quarter earnings. Infosys, the bellwether stock of the technology index, will release results on January 11, 2013.

However, the domestic bourses traded choppy throughout the day as global risk appetite was slightly frail after several Federal Reserve officials expressed concerns about continuing to expand stimulative bond buying on Dec 3 FOMC meet. European markets too added fuel to the fire by opening in the red as signs of rising concerns among US Federal Reserve members about the central bank’s quantitative easing programme prompted investors to book a portion of recent strong gains. However, Asian markets ended mixed with Japanese benchmark soaring in a post-holiday catch-up rally that was aided again by a weaker yen.

Back home, market-men got some support from HSBC’s Services Purchasing Managers Index (PMI) for December which stood at 55.6, up from 52.1 in the previous month, signaling a sharp expansion in activity. Rally in state-run upstream oil companies too aided the sentiments as stocks of ONGC and Oil India surged after committee set up under the chairmanship of C Rangarajan, Chairman, Economic Advisory Council to the Prime Minister to look into the Production Sharing Contract Mechanism in petroleum industry, suggested major changes in the current Production Sharing Contract Mechanism and changes in gas pricing.

Shares of gold loan firms like Manappuram Finance, Muthoot Finance and Muthoot Capital Services extended their Thursday’s gains triggered by the Reserve Bank of India proposing an increase in the loan-to-value ratio on gold loans to 75% from 60% currently. However, selling witnessed in metal space and stocks like Sesa Goa, Sterlite Industries, Hindalco, Tata Steel and Hindustan Zinc all tumbled as LMEX, a gauge of six metals traded on the London Metal Exchange, fell 1.18% to 3,539.60 on January 3, 2013.

The NSE’s 50-share broadly followed index Nifty rose by six points to end above the psychological 6,000 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex rose by about twenty points to finish well above the psychological 19,750 mark. Moreover, broader markets too traded in-line with benchmarks and ended the session in the positive terrain.

The overall volumes stood above Rs 1.05 lakh crore, which remained on the higher side as compared to that on Thursday. The market breadth remained in favor of advances as there were 1,521 shares on the gaining side against 1,435 shares on the losing side while 114 shares remain unchanged.

Finally, the BSE Sensex gained 19.30 points or 0.10% to settle at 19,784.08, while the S&P CNX Nifty rose by 6.65 points or 0.11% to end at 6,016.15.

The BSE Sensex touched a high and a low of 19,797.44 and 19,679.99, respectively. The BSE Mid-cap index was up by 0.28% and Small-cap index ended higher by 0.35%.

The top gainers on the Sensex were, GAIL India up by 1.90%, ONGC up by 1.79%, BHEL up by 1.76%, TCS up by 1.50% and Wipro up by 1.47%, while, Tata Steel down by 1.91%, Sterlite Industries down by 1.64%, Jindal Steel up 1.58%, Hindalco Industries up 1.34% and Tata Motors down by 0.79% were the top losers on the index.

The top gainers on the BSE Sectoral space were Oil & Gas up by 1.05%, PSU up by 1.02%, IT up by 0.95%, TECk up by 0.68% and Power was up by 0.46%, while Metal down 1.01%, FMCG down 0.28%, Auto down 0.26% and Capital Goods (CG) down 0.08% were top losers on the sectoral space.

Meanwhile, Finance Minister P Chidambaram headed Group of Ministers (GoM) meeting on Coal Regulator bill to be held on January 4 has been postponed yet again due to unavailability of a few ministers. The Cabinet had referred the draft Bill to a ministerial panel for setting up a regulatory authority for the coal sector. Earlier a meeting on December 18 was also postponed due to winter session of parliament.

The main agenda of the meeting was to set-up an independent regulator for the coal sector, which is considered important for improving the competitiveness in e-auctions, fixing guidelines for price revision in supply pacts, setting trading margins and increasing transparency in the allocation of reserves.

The recommendation of setting up a coal sector regulator came from Shankar Committee and country’s Integrated Energy Policy. A few states and other stakeholders have also been demanding setting-up of the coal regulator.

The S&P CNX Nifty touched a high and a low of 6,020.75 and 5,981.55 respectively.

The top gainers on the Nifty were Cairn up by 3.21%, BPCL up by 2.09%, BHEL up by 1.97%, GAIL up by 1.82% and IDFC up by 1.69%.

The top losers of the index were Tata Steel down by 1.98%, Jindal Steel down by 1.68%, Sesa Goa down by 1.57%, Hindalco down by 1.45% and Tata Motors down by 0.93%.

The European markets were trading in red, France’s CAC 40 down by 0.48%, Germany’s DAX down by 0.27% and the United Kingdom’s FTSE 100 down by 0.08%.

Asian markets ended mixed on Friday, as investors booked some profits from earlier sessions rally after senior Federal Reserve officials expressed worries over continuing bond buying. However, Japan's Nikkei closed firm on its first trading day of the New Year, as investors reacted to a weakening yen. Shanghai Composite went home with green mark, taking support from banking stocks, as the market opened for the first time after the U.S. fiscal-cliff agreement. Hong Kong's Hang Seng index ended lower following previous two sessions’ rally. Moreover, South Korean market closed with some losses as the country's export champions in electronics, cars and shipbuilding came under selling pressure.