Markets remain positive amid sustained buying

Following a firm start, Indian equity markets remained fairly well placed in positive territory in the late morning session amid sustained buying in several blue chip stocks. Higher capital inflows on the back of government's announcement last week to partially deregulate diesel prices also boosted market sentiments. In currency markets, rupee depreciated against dollar in the late morning session amid fresh demand for the US currency from banks and importers. On sectoral front, oil stocks, led by Reliance Industries, continued to remain in focus. Capital goods and FMCG stocks were mostly trading higher. Realty, automobile and information technology stocks were slightly weak. In global markets, most Asian shares were trading in red on Monday ahead of Bank of Japan policy meeting this week that is expected to yield bold monetary easing measures. Back home, the market breadth favoring positive trend; there were 1,271 shares on the gaining side against 1,156 shares on the losing side while 140 shares remain unchanged.

The BSE Sensex is currently trading at 20,105.55 up by 66.51 points or 0.33% after trading in a range of 20,163.38 and 20,078.06. There were 17 stocks advancing against 13 declines on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.20% and Small cap index was up by 0.32%.

The top gaining sectoral indices on the BSE were, Oil & Gas up by 1.94%, Capital Goods up by 1.11%, FMCG up by 0.74%, Power up by 0.48% and Metal up by 0.40%. While, Realty down by 0.40%, IT down by 0.37%, Auto down by 0.32%, Bankex down by 0.22% and Health Care down by 0.15% were the top losers on the index.

The top gainers on the Sensex were RIL up by 3.79%, BHEL up by 2.32%, Bharti Airtel up by 1.53%, Maruti Suzuki up by 1.48% and Jindal Steel up by 1.40%.

On the flip side, Cipla was down by 1.34%, Sun Pharma was down by 1.21%, Tata Motors was down by 1.19%, TCS was down by 1.06% and Mahindra & Mahindra was down by 1.04% were the top losers on the Sensex.

Meanwhile, the government is expected to get over Rs 9,497 crore from the sale of CDMA band spectrum in the second round of auctions in March and one-time fee on airwaves held by existing operators. If the entire CDMA spectrum auction is sold at the revised starting price, then the estimated auction proceeds will be Rs 9,497.15 crore. It includes Rs 6,463.95 crore from auction directly and Rs 3,033.20 crore from one-time spectrum fee.

The bidders of the CDMA spectrum are likely to be given option of deferred payment, as was recommended by Telecom Regulatory Authority of India, where they will have an option to pay 25 per cent of the bid amount. Pursuant to which, the government will be able to get at least Rs 1,615 crore from sale of spectrum in the auction.

Earlier, the Union Cabinet on January 17 approved a 50 per cent reduction in the reserve price of CDMA spectrum for the auction to be scheduled in March. In the previous auction, reserve price for CDMA spectrum was 11 times higher than the amount telecom operators paid in 2008, which did not attract bidders due to high reserve price. The decision follows a recommendation by the Empowered Group of Ministers (EGoM) which suggested a 50 per cent cut in the reserve price of 800 MHz band.

Meanwhile, the one-time spectrum fee will be levied on existing players including Reliance Communications, Tata Teleservices, Sistema Shyam and both state-owned telecom operators BSNL and MTNL with effect from January 1, 2013 for rest of their license period.

The S&P CNX Nifty is currently trading at 6,077.90 up by 13.50 points or 0.22% after trading in a range of 6,094.35 and 6,067.60. There were 26 stocks advancing against 24 declines on the index.

The top gainers of the Nifty were Reliance Industries up by 3.67%, BHEL up by 2.41%, Reliance Infra up by 2.04%, Cairn up by 1.77% and BPCL up by 1.51%.

On the flip side, UltraTech Cement down by 2.11%, DLF down by 1.94%, Ambuja Cement down by 1.66%, ACC down by 1.42% and Cipla down by 1.35% were the major losers on the index.

Most of the Asian equity indices were trading in red; Hang Seng declined 0.05%, Jakarta Composite declined 0.23%, KLSE Composite tumbled 2.28%, Nikkei 225 dropped 1.52%, KOSPI Composite was down by 0.05% and KOSPI Composite was down by 0.10%. On the flip side, Shanghai Composite rose 0.19% and Straits Times surged 0.31%.