Benchmarks extend losses for eighth straight session on Tuesday’s morning session

Extending losses for the eighth straight session, Indian equity indices have made a negative start on sustained selling by investors on worries over domestic political instability and a weakening trend in global markets. The US stocks fell on Monday on renewed concerns about the developments in Cyprus and the euro zone. Asian equity indices are trading mixed on Tuesday’s morning session as investors remain concerned about potential risks from the Cyprus bailout scheme. The Chinese Shanghai remained the top loser among the regional peers losing about one and a half percent, dragged by slump in brokerages and material producers.

Back home, market participants also resorted to selling on account of monthly expiry in the derivatives segment on Thursday and ending of financial year. However, the losses remain capped as some support came in after Prime Minister's Economic Advisory Council (PMEAC) Chairman C Rangarajan said that India’s Current Account Deficit (CAD) for 2012-13 is likely to be around 5 percent of the GDP. Rangarajan said CAD is likely to come down in the fourth quarter of the current fiscal, ending March 31 after touching a record high of 5.4 percent of GDP in the July-September quarter.

On the sectoral front, fast moving consumer goods and metal remained the only gainers while, oil and gas, realty and capital goods remained the top losers on the BSE sectoral space. The broader indices too were struggling to get some traction while, the market breadth on the BSE was negative; there were 799 shares on the gaining side against 894 shares on the losing side while 72 shares remain unchanged.

The BSE Sensex opened at 18,645.09; about 36 points lower compared to its previous closing of 18,681.42, and has touched a high and a low of 18,689.60 and 18,612.37 respectively.

The index is currently trading at 18,643.96, down by 37.46 points or 0.20%. There were 8 stocks advancing against 22 declines and one stock remains unchanged on the index.

The overall market breadth has made a weak start with 40.82% stocks advancing against 54.43% declines. The broader indices were trading in-line with benchmarks; the BSE Mid cap and Small cap indices declined by 0.38% and 0.20% respectively. 

The only gaining sectoral indices on the BSE were, FMCG up by 0.77% and Metal up by 0.05% while, Oil & Gas down by 1.19%, Realty down by 0.97%, Capital Goods down by 0.87%, Bankex down by 0.42% and IT down by 0.37% were the top losers on the sectoral index.

The top gainers on the Sensex were Bharti Airtel up by 1.58%, Coal India up by 1.50%, ITC up by 1.31%, HDFC up by 1.12% and Tata Motors up by 0.72%.

On the flip side, Gail India was down by 1.78%, RIL was down by 1.44%, ONGC was down by 1.25%, L&T was down by 1.20% and Maruti Suzuki was down by 1.00% were the top losers on the Sensex.

Meanwhile, expressing confidence that India would be able to achieve 7-8% growth again in next 2-3 years, President Pranab Mukherjee has asked industrialists to keep faith in robust fundamentals of Indian economy. While addressing an event, he said that India's economic growth story is intact and there was no reason to be pessimistic as the government is taking corrective measures to boost the economy’s growth. 

By adding further he said, the country had recorded growth of 9.3% even in the worst global economic scenario and 6.7% in 2008-09 when financial crisis created virtual turmoil in the largest economies of the world and slowed down the business activities of many developed countries.

However, expressed concern over the declining private investment, which was mainly on the back of tight monetary policy adopted by the RBI, which increased the cost of borrowing, thereby making it difficult for the private sector to raise capital. Though tightening of monetary policy between March 2010 and October 2011 was necessary to combat the rising inflation.

Further, Mukherjee also highlighted the need for an inclusive economic growth and said, with inclusive growth, we can contract the widening gap between the poor and rich people. Without inclusive growth, poor are becoming poorer and in India, there are 355 million people live below the poverty line. 

The CNX Nifty opened at 5,613.75; about 20 points lower as compared to its previous closing of 5,633.85, and has touched a high and a low of 5,638.70 and 5,612.05 respectively.

The index is currently trading at 5,628.60, down by 5.25 points or 0.09%. There were 19 stocks advancing against 31 declines on the index.

The top gainers of the Nifty were Coal India up by 1.53%, HCL Tech up by 1.49%, Ranbaxy up by 1.45%, ITC up by 1.44% and Bharti Airtel up by 1.11%.

On the flip side, GAIL down by 1.88%, Reliance Infrastructure down by 1.71%, Reliance Industries down by 1.48%, DLF down by 1.47% and Siemens down by 1.47%, were the major losers on the index.

Most of the Asian equity indices were trading in green; Jakarta Composite rose 35.70 points or 0.75% to 4,813.60, KLSE Composite strengthened 8.34 points or 0.51% to 1,652.23, Straits Times increased 4.12 points or 0.13% to 3,271.60, KOSPI Composite added 8.84 points or 0.45% to 1,986.51 and Taiwan Weighted was up by 10.74 points or 0.14% to 7,866.86.

On the flip side, Shanghai Composite tumbled 34.40 points or 1.48% to 2,292.31, Hang Seng declined 74.46 points or 0.33% to 22,176.69 and Nikkei 225 was down by 24.96 points or 0.20% to 12,521.50.