Markets continue positive trade amid volatility

Following a positive opening and subsequent retreat, Indian equity markets regained the momentum and continued trading positive amid stock specific buying.  The Sensex was up 136.03 points, while Nifty was up 47.85 points. Investors were trading cautious on worries over the government being forced to call early elections coupled with its reform agenda weakening after Congress' ally DMK withdrew its support from the ruling coalition this week. In currency market, rupee appreciated against greenback amid dollar selling by some banks. On the sectoral front, bank, metal, consumer durables, and capital goods stocks were trading in green, while select auto, FMCG and healthcare stocks were witnessing selling pressure. On the global front, most Asian shares were trading higher, as a pick-up in Chinese factory activity and a commitment by the US Federal Reserve to its aggressive stimulus stance soothed sentiment rattled by wrangling over a bailout plan for Cyprus. Back home, the market breadth was favoring negative trend; there were 1,271 shares on the losing side against 1,030 shares on the gaining side while 127 shares remain unchanged.

The BSE Sensex is currently trading at 19,020.22, up by 136.03 points or 0.72% after trading in a range of 19,042.00 and 18,798.98. There were 21 stocks advancing against 9 declines on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.24% and Small cap index was up by 0.05%.

The top gaining sectoral indices on the BSE were Bankex up by 1.78%, Metal up by 1.30%, Consumer Durables up by 1.14%, TECk up by 1.05% and Capital Goods up by 0.69%, while Auto down by 0.91%, FMCG down by 0.36% and Health Care down by 0.16% were the top losers on the BSE.

The top gainers on the Sensex were Bharti Airtel up by 6.78%, ICICI Bank up by 4.83%, Jindal Steel up by 2.87%, HDFC up by 2.75% and Sterlite Industries up by 2.02%.

On the flip side, Tata Motors was down by 3.39%, Bajaj Auto was down by 1.50%, Hindustan Unilever was down by 1.46%, NTPC was down by 1.15% and Sun Pharma was down by 0.86% were the top losers on the Sensex.

Meanwhile, snapping the previous two months of declining trend, the Foreign Direct Investment (FDI) in India grew by 8 percent to $2.15 billion in January against the $2 billion in the same month of the previous year. However, in the April-January period of the current fiscal, FDI declined by 39 percent to $19.10 billion from $31.28 billion recorded in previous fiscal mainly due to the global economic uncertainties.

During the April-January period of the current fiscal, the sectors which have received large FDI inflows include services ($4.66 billion), hotel and tourism ($3.19 billion), metallurgical ($1.38 billion), construction ($1.20 billion) and Pharmaceuticals ($1 billion). On country wise, India received maximum FDI from Mauritius ($8.17 billion), followed by Japan ($1.69 billion), Singapore ($1.82 billion), Netherlands ($1.51 billion) and the UK ($1.04 billion).

Meanwhile, FDI from Mauritius to India is the highest in comparison with all the other countries that invest in India due to the special treatment of tax that is given in India to the investments that come through Mauritius.

The Indian government has realized the fact that foreign direct investment plays a very crucial role in boosting the country's economy by developing the infrastructure, generating new jobs, transfer of technology, and increasing productivity. Thus, the government liberalized its economic policies in order to use foreign direct investment as a developmental tool. 

The CNX Nifty is currently trading at 5,742.25 up by 47.85 points or 0.84% after trading in a range of 5,746.95 and 5,670.50. There were 33 stocks advancing against 17 declines on the index.

The top gainers of the Nifty were Bharti Airtel up by 7.14%, ICICI Bank up by 4.86%, Jindal Steel up by 3.08%, HDFC up by 3.05% and Axis Bank up by 2.34%.

On the flip side, Tata Motors down by 3.12%, Bank of Baroda down by 1.50%, HUL down by 1.47%, Bajaj Auto down by 1.31% and NTPC down by 1.11% were the major losers on the index.

Most of the Asian equity indices were trading in the green; Shanghai Composite rose 0.24%, Jakarta Composite increased 0.12%, KLSE Composite moved up 0.09%, Nikkei 225 surged 1.34%, Straits Times jumped 0.61% and Taiwan Weighted was up by 0.18%.

On the flip side, Hang Seng down by 0.18% and KOSPI Composite was down by 0.44%.