Benchmarks trimming substantial portion of early gains slip near intra-day low

After starting the session on a fairly optimistic note, benchmark equity indices paring substantial portion of their early gains are now trading near intraday lows, as investors cashed out their profits at higher level due to prevailing caution ahead of budget session of Parliament that will begin on February 21 with President Pranab Mukherjee's first address to the joint sitting of the Lok Sabha and the Rajya Sabha.

However, surge of index heavyweight, Reliance Industries, is keeping the momentum of the Indian equity markets on the positive side, with sanguine regional counterparts aiding the upside. Shares in Reliance Industries rallied over  two percent, a day after the company announced that it would invest over $5 billion in the next three to five years with UK partner BP to boost declining output at a key natural gas field off India's east coast. Benchmark 30 share index and 50 share index, Sensex and Nifty, although near day’s low are trading above 19600 and 5900 levels respectively. Meanwhile, broader indices too witnessing profit-booking have relinquished major portion of their gains.

On the global front, Asian pacific shares rose to their higher level since August after an improving global economic outlook boosted world equities overnight, encouraging investors to take on risk.

Closer home, Realty , Oil & Gas and Information Technology (IT) counters were the star performers of the trade, while Consumer Durable , Fast Moving Consumer Goods and  metal counters, were eating into the bourses gains. Besides, rally in Aviation space too supported the sentiments, as stocks like Kingfisher, Spicejet and Jet Airways flew higher on the back of the ongoing price war. Moreover, Power stocks too remained on the buyers’ radar as the ministry once again discussed the standard bidding documents for case-II Ultra Mega Power Projects with industry players before taking the approval from the Empowered Group of Ministers. The market breadth on the BSE is positive; advances and declining stocks were in a ratio of 1337: 880 while 107 scrips remained unchanged.

The BSE Sensex is currently trading at 19653.67 up by 17.95 points or 0.09% after trading in a range of 19742.42 and 19645.90. There were 13 stocks advancing against 17 declines on the index.

The broader indices were trading in green; BSE Midcap and Small cap indices were trading higher by 0.14% and 0.58% respectively.

The top gaining sectoral indices on the BSE were, Realty up by 1.17%, Oil & Gas up by 1.05%, IT up by 0.37%, TECk up by 0.21% and PSU up by 0.09%. While, CD down by 0.90%, FMCG down by 0.32%, Metal down by 0.16%, Bankex down by 0.07% and Auto down by 0.04% were the top losers on the index.

The top gainers on the Sensex were RIL up by 1.91%, Wipro up by 1.00%, Hero MotoCorp up by 0.92%, HDFC Bank up by 0.68% and Coal India up by 0.68%.

On the flip side, Cipla was down by 1.03%, Sterlite Industries was down by 0.83%, Bharti Airtel was down by 0.71%, Hindustan Unilever was down by 0.70% and Maruti Suzuki was down by 0.69% were the top losers on the Sensex.

Meanwhile, the government is likely to push key economic reform bills in areas such as insurance, pension and corporate law in the Budget Session of Parliament beginning on February 21. The budget for FY14, which will be preceded by economic survey, is scheduled to be announced on February 28 by Finance Minister P Chidambaram, will also address key issues like declining industrial output, widening fiscal deficit and decelerating economic growth.

The government’s economic agenda includes passage and consideration of bills on insurance, pension and Food Security Law, which has been pending from long time. The insurance and pension bills is seeking to raise foreign direct investment (FDI) cap in the sector from 26 percent to 49 percent, while the Food Security Bill seeks to provide subsidized food grain to people below poverty line.

However, more than 70 items, including 16 new Bills, are part of the government’s business for the budget session of parliament. The session, which will have 34 sittings in two laps, will begin on Feb 21. Other important economic reforms bills on the economic agenda includes Forward Contracts (Regulation) Amendment Bill, Agricultural Bio Security Bill, the Biotechnology Regulatory Authority of India Bill and the Companies Bill, which is yet to be vetted by the Rajya Sabha.The S&P CNX Nifty is currently trading at 5,947.85 up by 8.15 points or 0.14% after trading in a range of 5,971.00 and 5,945.50. There were 30 stocks advancing against 20 declines on the index.

The top gainers of the Nifty were DLF up by 2.07%, BPCL up by 1.94%, Reliance up by 1.93%, Ambuja Cements up by 1.73% and HCL Tech up by 1.06%.

On the flip side, CIPLA down by 1.24%, Bharti Airtel down by 0.99%, JP Associate down by 0.80%, Sesa Goa down by 0.73% and NTPC down by 0.68% were the major losers on the index.

Most of the Asian equity indices were trading in the green; Hang Seng rose 36.79 points or 0.16% to 23,180.70, Jakarta Composite strengthened 21.89 points or 0.48% to 4,623.96, Nikkei 225 increased 80.80 points or 0.71% to 11,453.14, Straits Times added 5.29 points or 0.16% to 3,300.96, Kospi Composite surged by 35.53 points or 1.79% to 2,021.36 and Taiwan Weighted was up by 68.22 points or 0.86% to 8,029.10.

On the flip side, Shanghai Composite slipped 4.87 points or 0.20% to 2,378.04 and KLSE Composite was down by 4.05 points or 0.25% to 1,611.02.