Sensex, Nifty slips into red; rate sensitive stocks major gainers

Following a positive start, Indian equity markets gave up all early gains and slipped into negative territory in the late morning session. The Sensex fell by 21 points, while the Nifty declined by 8.35 points. Investors remained cautious ahead of the Reserve Bank of India’s (RBI) third-quarter monetary policy review on Jan 29. In currency markets, rupee depreciated against dollar amid fresh demand for greenback for month end payments from oil importers. On sectoral front, all rate sensitive stocks including realty, banking, and auto were trading in green ahead of central bank’s policy review, while oil & gas, power, consumer durables and capital goods were trading in red. In global markets, most Asian shares were trading higher, on positive earnings outlook for Chinese firms and amid corporate results driven rally on Wall Street, although Japanese stocks fell from near three-year highs as investors took profit. Back home, the market breadth favoring positive trend; there were 1,335 shares on the gaining side against 1,016 shares on the losing side while 113 shares remain unchanged.

The BSE Sensex is currently trading at 20,082.28 down by 21.25 points or 0.11% after trading in a range of 20,172.45 and 20,076.92. There were 16 stocks advancing against 14 declines on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.15% and Small cap index was up by 0.57%.

The top gaining sectoral indices on the BSE were, Realty up by 1.17%, Auto up by 1.03%, IT up by 0.61%, TECk up by 0.44% and Bankex up by 0.33%. While, Oil & Gas down by 1.10%, Power down by 0.53%, Consumer Durables down by 0.41%, Capital Goods down 0.37% and PSU down by 0.35% were the few losers on the index.

The top gainers on the Sensex were Hero MotoCorp up by 1.85%, Gail India up by 1.56%, Wipro up by 1.47%, Mahindra & Mahindra up by 1.37% and Tata Motors up by 1.20%.

On the flip side, ONGC was down by 1.79%, RIL was down by 1.75%, Coal India was down by 0.94%, Hindustan Unilever  was down by 0.87% and Jindal Steel was down by 0.83% were the top losers on the Sensex.

Meanwhile, foreign direct investment (FDI) inflows into the services sector during the April-November period this fiscal has declined by about 14 per cent to $3.63 billion. The global economic crises are impacting the FDI inflows in the sector.

Decline in foreign investments could affect the country’s balance of payments (BoP) situation and also impact the rupee. According to Industry Ministry Data, the financial and non-financial services sector had attracted FDI worth $4.22 billion during the same period last year. The overall FDI inflows declined to $15.84 billion during the first eight months of the current financial year, from $27.92 billion in the year-ago period.

Foreign investments are considered crucial for India, which needs around $1 trillion in the next five years to overhaul its infrastructure sector such as ports, airports and highways to boost growth. In 2011-12, foreign investment in the services sector, which contributes over 50 per cent to India’s GDP, rose to $5.21 billion from $3.29 billion in 2010-11. According to a ministry official “the government is making sustained efforts, including involving stakeholders in policy formation and to make the investment regime more attractive and investor friendly.”

The other sectors which have received FDI during April-November, 2012-13 include hotel and tourism ($ 3.13 billion), metallurgy ($1.26 billion), construction ($1.01 million) and automobile ($760 million). The government has already allowed FDI in multi-brand retail sector besides hiking the cap to 100 per cent in the single brand retailing.

The S&P CNX Nifty is currently trading at 6,066.30 down by 8.35 points or 0.14% after trading in a range of 6,088.40 and 6,065.65. There were 26 stocks advancing against 24 declines on the index.

The top gainers of the Nifty were HCL Tech up by 2.64%, Cairn up by 1.91%, Hero MotoCorp up by 1.88%, GAIL up by 1.63% and DLF up by 1.60%.

On the flip side, Reliance Infra down by 2.27%, ONGC down by 1.79%, Reliance Industries down by 1.72%, Ambuja Cement down by 1.36% and BPCL down by 1.19% were the major losers on the index.

Most of the Asian equity indices were trading in the green; Shanghai Composite surged 1.86%, Hang Seng rose 0.46%, Straits Times added 0.14% and Taiwan Weighted was up by 0.55%.

On the flip side, Jakarta Composite declined 0.41%, Nikkei 225 slipped 0.79% and KOSPI Composite was down by 0.42%.