Sensex pares early gains; Nifty slips into red

After opening higher, Indian equity markets erased some early gains as part of investors were engaged in profit booking. The Sensex was trading flat in positive territory, while Nifty slipped into red zone. In currency market, rupee recovered against American currency amid dollar selling by banks. On sectoral front, gas producing companies were trading with strong gains following a recommendation to scrap government-controlled pricing mechanism. Auto stocks also trading up, as Maruti Suzuki remained the top gainer on the Sensex, buoyed by December sales numbers, while banking stocks were trading flat in negative territory ahead of RBI policy meet on January 29. In global markets, Asian shares were trading mixed on Monday as some investors booked profits from a New Year’s rally, but financial stocks were up after global regulators decided to relax draft plans for tough new bank liquidity rules. Back home, the market breadth favoring positive trend; there were 1,614 shares on the gaining side against 913 shares on the losing side while 130 shares remain unchanged.

The BSE Sensex is currently trading at 19,793.20 up by 9.12 points or 0.05% after trading in a range of 19,856.43 and 19,758.23. There were 19 stocks advancing against 11 declines on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.74% and Small cap index was up by 0.84%.

The top gaining sectoral indices on the BSE were, Auto up by 0.89%, Metal up by 0.77%, Health Care up by 0.71%, Oil & Gas up by 0.55% and Consumer Durables up by 0.42% while, Capital Goods down by 0.52%, Realty down by 0.25%, Bankex down 0.16% and Power down by 0.06%  were the top losers on the index.

The top gainers on the Sensex were Maruti Suzuki up by 2.98%, Hindalco Industries up by 2.15%, Cipla up by 1.83%, Sun Pharma up by 1.41% and ONGC up by 1.35%. 

On the flip side, HDFC was down by 1.15%, L&T was down by 1.10%, HDFC Bank was down by 1.05%, Coal India was down by 0.96% and Hindustan Unilever was down by 0.89% were the top losers on the Sensex.

Meanwhile, after the passage of the Banking Amendment Bill, the Reserve Bank of India (RBI) is expected to float final guidelines for the grant of banking licence’s to new players within the next four-six weeks. The RBI is keen to finalize new banking norms before the retirement of deputy governor Anand Sinha, who is in charge of the department of Banking Operations and Development at the central bank.

Further towards this development, most of the banking aspirants, including Anil Ambani-led Reliance Group, financial conglomerates Religare and Shriram groups, engineering-to-technology major L&T group and Aditya Birla group, have begun doing the groundwork. While, quite a few large corporate houses are even confident of meeting the regulatory framework despite some voices being raised in certain quarters about concerns of possible conflict of interest in case of industrial houses being given banking permits as it has the potential to create conflict of interests.

The finance ministry is also currently in the process of sending its final comments to the RBI on the draft guidelines issued by the central bank on the matter, after which the final guidelines should be made public. The RBI is already in the process of gathering the comments received from various stakeholders on the draft guidelines.

The S&P CNX Nifty is currently trading at 6,014.65 down by 1.50 points or 0.02% after trading in a range of 6,042.15 and 6,005.75. There were 24 stocks advancing against 25 declines and one remains unchanged on the index.

The top gainers of the Nifty were BPCL up by 3.58%, Maruti Suzuki up by 3.06%, Hindalco up by 2.30%, Cairn up by 2.14% and Cipla up by 1.77%.

On the flip side, Coal India down by 1.28%, HDFC down by 1.17%, HUL down by 1.17, L&T down by 1.15% and ACC down by 1.05% were the major losers on the index.

The Asian equity indices were trading mixed; Hang Seng dropped 0.21%, Nikkei 225 was down by 0.77%, Straits Times declined 0.05%, KOSPI Composite contracted 0.07% and Taiwan Weighted was down by 0.65%.

On the flip side, Shanghai Composite up by 0.13%, Jakarta Composite added 0.04% and KLSE Composite slipped 0.12%.