Indian markets trade with marginal gains in early deals

Buoyed by firm global cues, Indian equity indices have made a gap-up opening after five consecutive days of declines as investors kept themselves busy in buying beaten down fundamentally strong stocks. Global risk appetite too remained firm on hopes of global growth recovery after Alcoa Inc, the largest US aluminum producer, reported first-quarter earnings that exceeded analysts’ estimates as demand from airplane and car manufacturers increased. Most of the Asian markets were trading in green terrain as sentiments got some boost after Chinese trade data signalled a recovery in the world’s second largest economy. China recorded a mild trade deficit of $884 million in March as imports surged way ahead of market expectations, growing 14.1% year-on-year, while annual export growth of 10.0% were largely in line with forecasts.

Back home, markets soon, after a gap up opening, pared most of their initial gains and are trading with marginal profit as investors remained on the sidelines focusing on Infosys results later this week. Also Industrial production numbers, which is due on April 12, may also have some impact on the trading sentiment this week as IIP data is likely to be a key input for RBI’s next policy review on May 3. Even though, frontline managed to keep their head above water supported by buying in technology and software counters after Gartner survey stated that a majority of large Indian enterprises are planning to increase their IT spending this year.

On the sectoral front, software witnessed the maximum gain in trade followed by technology and capital goods while, auto, consumer durables and fast moving consumer goods remained the top losers on the BSE sectoral space. The broader indices, however, were trading in red terrain while, the market breadth on the BSE was negative; there were 731 shares on the gaining side against 847 shares on the losing side while 92 shares remain unchanged.

The BSE Sensex opened at 18,355.14; about 128 points higher compared to its previous closing of 18,226.48, and has touched a high and a low of 18,382.26 and 18,225.20 respectively.

The index is currently trading at 18,257.98, up by 31.50 points or 0.17%. There were 13 stocks advancing against 17 declines on the index.

The overall market breadth has made a weak start with 41.53% stocks advancing against 54.52% declines. The broader indices were trading in red; the BSE Mid cap and Small cap indices down by 0.26% and 0.18% respectively. 

The top gaining sectoral indices on the BSE were, IT up by 1.01%, Teck up by 0.97%, Capital Goods up by 0.11%, Health Care up by 0.11% and Realty up by 0.09% while, Auto down by 0.75%, Consumer Durables down by 0.53%, FMCG down by 0.37%, Oil & Gas down by 0.36% and PSU down by 0.29% were the only losers on the sectoral index.

The top gainers on the Sensex were HDFC up by 1.84%, Bharti Airtel up by 1.82%, Wipro up by 1.70%, TCS up by 1.50% and NTPC up by 1.10%.

On the flip side, Tata Motors was down by 1.37%, Maruti Suzuki was down by 1.16%, Mahindra & Mahindra was down by 1.12%, ONGC was down by 0.99% and Dr Reddys Lab was down by 0.81% were the top losers on the Sensex.

Meanwhile, stronger external demand and progress on reforms could boost India's slowing economy to 6% growth this year. As per the multilateral funding agency ADB, reforms are required to facilitate more favorable investment environment and spur growth. However, cautioned that the country may fail to reach that level, if the government fails to pursue structural reforms further.

The agency in its report 'Asian Development Outlook 2013' has predicted growth in India to recover to 6% this year and 6.5% in 2014 from around 5% in 2012. As per the report, the growth forecast is an improvement over disappointing numbers last year but still far short of the capability of Asia's third-largest economy, which was seen few years back as a rising economic power that could even rival China, with the growth of over 9%.  

Highlighting inflation, as a key concern that is hampering India's scope to show high growth, ADB’s report said that the slowing growth has been paired with persistently high inflation. High prices, especially for food, limit the central bank's scope to reduce interest rates, although the Reserve Bank of India last month made its second cut this year to a key lending rate.  

Regarding the Asia’s emerging economies, it said that the growth in the developing Asia is expected to gain growth momentum this year, powered by rising domestic consumption and intra-regional trade, but authorities need to defend against the risks of inflation and asset bubbles arising from strong capital inflows.

The CNX Nifty opened at 5,536.25; about 41 points higher as compared to its previous closing of 5,495.10, and has touched a high and a low of 5,577.30 and 5,557.50 respectively.

The index is currently trading at 5,502.55, up by 7.45 points or 0.14%. There were 22 stocks advancing against 28 declines on the index.

The top gainers of the Nifty were HDFC up by 1.99%, Bharti Airtel up by 1.59%, TCS up by 1.58%, Lupin up by 1.38% and Kotak Bank up by 1.13%.

On the flip side, ONGC down by 1.55%, UltraTech Cement down by 1.44%, Mahindra & Mahindra down by 1.29%, Dr Reddy's Laboratories down by 1.17% and Tata Motors down by 1.16%, were the major losers on the index.

Most of the Asian equity indices were trading in green; Hang Seng rose 39.81 points or 0.18% to 21,910.15, KLSE Composite increased 3.36 points or 0.20% to 1,693.63, Nikkei 225 jumped 75.23 points or 0.57% to 13,267.58, KOSPI Composite added 15.22 points or 0.79% to 1,935.96 and Taiwan Weighted was up by 30.12 points or 0.39% to 7,758.66.

On the flip side, Shanghai Composite declined 7.01 points or 0.32% to 2,218.76, Jakarta Composite slipped 18.30 points or 0.37% to 4,881.29 and Straits Times was down by 12.16 points or 0.37% to 3,284.41.