Sensx, Nifty hold early gains despite weak trade data for January

Indian equity markets continued trading in positive territory in the late morning session on Wednesday, despite of disappointing trade data for January 2013. Meanwhile, according to the data from trade ministry, January exports increased slightly by 0.8% on year-on-year basis, while imports up by 6.1% on year-on-year basis, leaving a trade deficit at $20 billion against $17.6 billion last year. Investors were trading cautiously ahead of January WPI data release on Feb 14, which is expected to have eased on the back of a smaller rise in prices of manufactured goods. In currency markets, rupee pared early gains against dollar in late morning session amid increasing dollar demand from oil importers. On sectoral front, all were trading in green except FMCG. However, shares of Kingfisher Airlines sharply fell to the maximum daily limit of 5% after lenders said they will initiate recovery proceedings against the defaulting carrier. In global markets, Asian shares were steady, with many regional bourses shut for holidays. Back home, the market breadth favoring negative trend; there were 1,563 shares on the losing side against 796 shares on the gaining side while 106 shares remain unchanged.

The BSE Sensex is currently trading at 19,701.99 up by 140.95 points or 0.72% after trading in a range of 19,721.67 and 19,601.69. 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 0.81% and Small cap index was up by 0.64%.

The top gaining sectoral indices on the BSE were, IT up by 1.53%, TECk up by 1.44%, Realty up by 1.26%, Consumer Durables up by 0.91% and Oil & Gas up by 0.81%. While, FMCG down by 0.30% was the sole loser on the index.

The top gainers on the Sensex were Tata Motors up by 2.35%, TCS up by 1.97%, Bharti Airtel up by 1.68%, HDFC up by 1.58% and Infosys up by 1.46%.

On the flip side, Dr Reddys Lab down by 1.29%, Bajaj Auto down by 1.13%, Hindustan Unilever was down by 0.74%, Tata Power down by 0.62% and Maruti Suzuki down by 0.47% were the top losers on the Sensex.

Meanwhile, worried over the prevailing economic slowdown, Prime Minister Manmohan Singh said the government is committed to containing the fiscal deficit to 5.3% of GDP this fiscal and various steps are being taken to revive economy including faster clearances to mega projects among others. While addressing the conferences of governors, he said that Indian economy has slowed down considerably in the last two years and for this fiscal, it is expected to resister much below growth than the average growth of about 8 percent that achieved in the last decade.  

By adding further he said 'global as well as domestic factors have caused this economic slowdown. It is imperative that we do everything possible to reverse this trend and the government has made concerted and serious efforts in recent months to revive investment and growth'. Efforts are being made to fast track investment proposals with particular focus on clearances from the environment and forest angles as well as towards removal of infrastructural bottlenecks.

Further highlighting the investment hurdles faced by the country, Singh said investment climate is also affected by the activities of state governments and factors like the state of law and order and how easy or difficult it is to acquire land and obtain electricity connections also have an important influence on the climate for investment.

Emphasizing large fiscal deficit as a specific cause of concern he said a fiscal consolidation roadmap has already been put in place to lower it gradually and policy measures announced in the current year have generated optimism which is reflected in an upturn in the Business Expectations Index for the October-December quarter, the Purchasing Managers’ Index in October-December and buoyancy in capital markets.

Regarding the economy recovery, Singh added that the internal accruals of the corporate sector have started improving, which is necessary to pick up investment and there has also been a moderation in core inflation. The recent direct cash transfer scheme will help improve targeting, reduce corruption, eliminate waste and enhance efficiency in the public delivery system. While, the economy expanded by 5.4% in the first half of the ongoing fiscal. However, as per the latest estimates of Central Statistical Organization (CSO), India’s economic growth (GDP) is likely to slow down to 5% for this fiscal as against 6.2% achieved last year.  

The S&P CNX Nifty is currently trading at 5,964.20 up by 41.70 points or 0.70% after trading in a range of 5,969.50 and 5,938.25. There were 31 stocks advancing against 19 declines on the index.

The top gainers of the Nifty were HCL Tech up by 3.60%, JP Associate up by 2.56%, Tata Motors up by 2.43%, TCS up by 1.98% and IDFC up by 1.96%.

On the flip side, Dr Reddy down by 1.31%, Bajaj Auto down by 1.12%, DLF down by 0.90%, Lupin down by 0.83% and HUL down by 0.75% were the major losers on the index.

Most of the Asian markets were trading in the green, Jakarta Composite rose 0.70%, KLSE Composite surged 0.49%, Straits Times strengthened 0.90% and KOSPI Composite soared 1.56%.

On the flip side, Nikkei 225 was down by 1.04%.

China, Hong Kong and Taiwan markets were closed for trade today.