Indian equity pare gains; IT, TECK and Realty leads

Indian equity markets pared gains but continued to trade firm in a narrow range in the late afternoon session on account of buying in frontline counters. The sentiments on the street were on upbeat mood after data showed that India’s export, snapping eight months declining trend, rose at an annual rate of 0.82% at $25.58 billion in January, with imports too rising by 6.12% at $45.58 billion for the month, leaving a trade deficit of $19.99 billion. Traders were seen piling some position in IT, TECk and Realty sectors while selling was witnessed in Power, Metal and FMCG sector. In the scrip specific development, Kingfisher Airlines was trading in red as the lenders have initiated recovery proceedings after the country’s once second-biggest airline’s management, despite several rounds of meetings over the last year or so, failed to come up with any concrete plan of action for pumping in funds to revive the grounded airline. Hero MotoCorp is trading under pressure as the workers’ union at the Gurgaon plant demanded an early settlement of the wage hike issue, adding that they are willing to go to any extent, including strike, to press their demands. SAIL is trading in red after brokerage house Citi maintained its sell rating, after the company’s third quarter net profit fell 53% year-on-year because of sluggish sales and lower realization. Motherson Sumi Systems was trading in green after the board of directors approved qualified institutional placement (QIP) of up to 4.4 crore shares constituting 7.5% of existing equity shares.

On the global front, majority of the Asian markets were trading in green barring Nikkei 225 while the European markets were trading on a mixed note.  Back home, the NSE Nifty and BSE Sensex were trading above their psychological 5,950 and 19,600 levels respectively. The market breadth on BSE was positive in the ratio of 1434:1246 while 133 scrips remain unchanged.

The BSE Sensex is currently trading at 19,668.18, up by 107.14 points or 0.55% after trading in a range of 19,723.01 and 19,601.69. There were 15 stocks advancing against 15 declines on the index.

The broader indices continued to trade in fine contour; the BSE Mid cap and Small cap index was trading up by 0.54% and 0.32% respectively.

The top gaining sectoral indices on the BSE were, IT up by 1.26%, TECk up by 1.21%, Realty up by 1.02%, Auto up by 0.86% and Consumer Durables up 0.63%. While, Power down by 0.49%, Metal down by 0.44%, FMCG down by 0.34% and Capital Goods down 0.12% were the only losers on the index.

The top gainers on the Sensex were Tata Motors up by 2.92%, Bharti Airtel up by 2.27%, TCS up by 1.79%, Mahindra & Mahindra up by 1.62% and HDFC up by 1.37%.

On the flip side, Bajaj Auto down by 1.70%, Sterlite Industries down by 1.62%, Gail India was down by 1.39%, Hindalco Industries down by 1.38% and Maruti Suzuki down by 1.10% were the top losers on the Sensex.

Meanwhile, opposing the recommendations of the Rangarajan Panel on production sharing contract, fertiliser makers have pitched for the continuance of the existing domestic gas pricing mechanism. The Fertiliser Association of India (FAI) has said the existing formula for calculating the price of gas from the Reliance Industries operated KG-D6 block may be followed as it was suggested by the gas producers, approved by the Government and accepted by the consumers like the fertiliser makers.

The existing formula is linked to the crude oil price and requires a ceiling of $60 per barrel on the crude price. Further, FAI said that the ceiling may be removed and allowed to float with monthly price of Brent crude.

Meanwhile, the government is expected to approve new policy guidelines for the pricing of natural gas based on the Rangarajan committee report. If approved it would more-than-double the price of domestic gas sold by the state owned oil companies along with this it would also raise costs for power and fertiliser companies and other natural gas buyers such as city gas distributors.

The Rangarajan committee, recommended pricing of domestically produced natural gas at an average of international hub prices and cost of imported LNG instead of present mechanism of market discovery. Further, the Rangarajan formula is the mean of weighted averages of the producer price of liquefied natural gas imports to India and the price prevalent in Europe, the US and Japan.

Moreover, the Rangarajan formula is applicable to all natural gas producers, including government companies for nominated fields and private companies. The new price would be uniformly applicable to all consumers.

The S&P CNX Nifty is currently trading at 5,951.60, up by 29.10 points or 0.49% after trading in a range of 5,969.50 and 5,938.25. There were 22 stocks advancing against 28 declines on the index.

The top gainers of the Nifty were HCL Tech up by 3.54%, Tata Motors up by 2.86%, Bharti Airtel up by 2.11%, TCS up by 1.95% and IDFC up by 1.84%.

On the flip side, Reliance Infrastructure down by 2.25%, Sesa Goa down by 1.93%, Bajaj Auto down by 1.73%, Hindalco Industries down by 1.69% and Power Grid down by 1.28% were the major losers on the index.

Most of the Asian markets were trading in the green, Jakarta Composite rose 0.54%, KLSE Composite surged 0.57%, Straits Times strengthened 0.95% and KOSPI Composite soared 1.56%. On the flip side, Nikkei 225 was down by 1.04%.  Meanwhile, China, Hong Kong and Taiwan markets were closed for trade today.

The European markets were trading on a mixed note; France’s CAC 40 lost 0.17%, Germany’s DAX gain 0.06% and United Kingdom’s FTSE 100 edged lower by 0.28%.