Barometer gauges recoup some losses; weakness persist

Indian equity markets although have trimmed losses, continue to trade weak in the late afternoon session on account of sustained selling pressure in FMCG, Consumer Durables and Bankex sectors. Nevertheless, buying in Health Care and Realty sector, have provided a lid to further downside chances of bourses. The benchmark indices BSE - Sensex and the NSE’s 50-unit - S&P CNX Nifty touched their lowest level in three and half weeks as the sentiment remained sour even after reports suggested of Fitch Ratings praising India’s recent economic reforms and fiscal consolidation measures, joining its international credit ratings peers in changing the tone of its commentary about the country from decidedly negative to mildly positive. Fitch had put India’s investment-grade BBB- rating on watch in June last year and warned that there was a good chance of it being downgraded to junk.

On the scrip specific development, Kingfisher Airlines was trading under pressure after reporting a net loss of Rs 755.17 crore for the third quarter ended December 31, 2012, a period when it did not operate a single flight. United Spirit, on the other hand, is trading in green after market regulator SEBI gave clearance for an open offer to global liquor giant Diageo Plc to acquire 26% stake from public shareholders of the UB group firm. Bombay Dyeing & Manufacturing Company slipped after in a major setback to the company the Maharashtra government has informed the Bombay High Court that the textiles major had obtained approval for using a mill land in central Mumbai for commercial development illegally and unlawfully with the connivance of a government officer not vested with the authority.

On the global front, all the Asian markets were trading in red barring Shanghai Composite while the European markets, stabilising after the previous session's sharp sell-off, edged higher on Tuesday, as investors digested a raft of earnings reports, with ARM leading gainers after its fourth-quarter results. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 6,000 and 19,700 levels respectively. The market breadth on BSE was negative in the ratio of 816:1857 while 104 scrips remain unchanged.

The BSE Sensex is currently trading at 19,689.93, down by 61.26 points or 0.31% after trading in a range of 19,717.26 and 19,640.45. There were 12 stocks advancing against 18 declines on the index.

The broader indices too recouped some losses; the BSE Mid cap and Small cap index was trading lower by 0.61% and 0.96% respectively.

The only gaining sectoral indices on the BSE were, Health Care up by 0.96% and Realty up 0.04%. While, FMCG down by 0.74%, Consumer Durables down by 0.74%, Bankex down by 0.58%, Power down by 0.50% and Oil & Gas down by 0.47% were the top losers on the index.

The top gainers on the Sensex were Sun Pharma up by 4.16%, Gail India up by 1.80%, Cipla up by 1.13%, Hindalco Industries up by 0.80% and Tata Steel up by 0.57%.

On the flip side, BHEL down by 2.76%, Bharti Airtel down by 1.72%, Sterlite Industries down by 1.46%, Hero MotoCorp down by 1.35% and Tata Motors down by 1.25% were the top losers on the Sensex.

Meanwhile, the commerce ministry has notified the government’s decision that export of processed and value added agriculture products such as wheat flour, butter, cheese, and oats will not be banned even though shipments of basic items are not allowed.

Directorate General of Foreign Trade (DGFT) listed 10 processed and value-added agricultural products that would be exempt from export curbs with immediate effect. These include wheat flour, cereal flour, cereal groats and meal pellets, milk products (including casein), butter, cheese and curd, value added products of onion, peanut butter and other cereal items.

DGFT in its notification said that “export of above processed and value added agricultural products will be exempted from any restriction even in the event of restriction/ban on the export of basic farm produce”.

The exports of processed and/or value added products constitute a very miniscule portion of the overall exports and hence their continuation would not affect the availability in the domestic market. However, the government had also, last week, allowed export of premium edible oils from the country even as it kept the ban of export of such oils in their raw or basic form.

The S&P CNX Nifty is currently trading at 5,964.40, down by 22.85 points or 0.38% after trading in a range of 5,970.35 and 5,946.90. There were 20 stocks advancing against 30 declines on the index.

The top gainers of the Nifty were Sun Pharma up by 3.96%, Ranbaxy Laboratories up by 1.64%, Gail India up by 1.56%, Ambuja Cements up by 1.35% and ACC up by 1.26%.

On the flip side, Jaiprakash Associates down by 3.83%, BHEL down by 2.83%, Bank of Baroda down by 2.67%, BPCL down by 2.09% and Bharti Airtel down by 1.75% were the major losers on the index.

All the Asian equity indices were trading in the red barring Shanghai Composite which was up 0.20%, Hang Seng tumbled 2.27%, Jakarta Composite dipped 0.49%, KLSE Composite slipped 0.14%, Nikkei 225 crumbled 1.90%, Straits Times dropped 0.93%, KOSPI Composite contracted 0.77% and Taiwan Weighted was down by 0.46%.