Benchmarks turn positive after a negative start

Indian equity benchmarks have turned positive after making a negative opening tracking global cues. Global risk appetite remained frail on rising concerns over pace of global growth recovery. The US markets pared all their gains overnight on a slew of disappointing earnings and as commodities resumed their sell-off amid ongoing worries over global growth while, most of the Asian equity indices were trading in red in Thursday’s morning session with Seoul Composite declining by above half a percent in morning deals, as LG Display led a broad selloff of tech stocks on worries about slowing demand for Apple Inc’s products and a dour growth outlook for Intel.

Back home, markets after a negative start, took a U-turn to get back their green terrain supported by buying in export oriented stocks like Shree Ganesh Jewellery House and Rajesh Exports as the government is likely to announce a host of incentives for sectors like engineering and textiles to boost shipments amid global demand slowdown. Rally in energy sector too aided the sentiments as Prime Minister Manmohan Singh has pitched for subsidies for clean energy saying market forces alone would not be able to finance it. However, the gains remain capped after private sector banks were trading under pressure, as Financial Services Secretary will meet a deputy governor of the Reserve Bank of India, among other officials, to take a call on the course of action with regard to allegations of money laundering.

On the sectoral front, capital goods witnessed the maximum gain in trade followed by healthcare and power while, metal, banking and consumer durables remained the top losers on the BSE sectoral space. The broader indices were outperforming benchmarks while, the market breadth on the BSE was positive; there were 711 shares on the gaining side against 502 shares on the losing side while 62 shares remain unchanged.

The BSE Sensex opened at 18,695.34; about 35 points lower compared to its previous closing of 18731.16, and has touched a high and a low of 18808.98 and 18691.61 respectively.

The index is currently trading at 18,781.76, up by 50.60 points or 0.27%. There were 13 stocks advancing against 17 declines on the index.

The overall market breadth has made a strong start with 55.76% stocks advancing against 39.37% declines. The broader indices were trading in green; the BSE Mid cap and Small cap indices up by 0.37% and 0.34% respectively. 

The top gaining sectoral indices on the BSE were, Capital Goods up by 1.04%, Health Care up by 0.74%, Power up by 0.69%, FMCG up by 0.46% and Realty up by 0.43% while, Metal down by 0.59%, Bankex down by 0.30%, Consumer Durables down by 0.17%, IT down by 0.09% and Auto down by 0.09% were the only losers on the sectoral index.

The top gainers on the Sensex were Bharti Airtel up by 2.88%, L&T up by 1.30%, HDFC up by 1.00%, NTPC up by 0.94% and Sun Pharma up by 0.88%.

On the flip side, Hindalco Industries was down by 1.29%, Jindal Steel was down by 1.26%, Hero MotoCorp was down by 1.14%, TCS was down by 0.86% and ICICI Bank was down by 0.84% were the top losers on the Sensex.

Meanwhile, as per the World Economic Outlook (WEO) report, Indian economy is projected to grow by 5.7% in 2013 and 6.2% in the next year as against world output growth of 3.25% and 4% respectively in the same period. Further, global prospects have improved again however the road to recovery in the advanced economies still remains uneven.

To be more precise, emerging market and developing economies are still going strong, but in advanced economies, there appears to be a growing split between the US on one hand and the euro-zone on the other. Emerging and developing economies are expected to grow by 5.3% in 2013 and 5.7% in 2014, while growth in the US is projected to be 1.9% in 2013 and 3% in 2014.

Referring to the Euro-zone growth outlook, the report said growth in the euro area is forecast to be -0.3% in 2013 and 1.1% in 2014. The forecast for negative growth in the euro-zone reflects not only weakness in the periphery but also some weakness in the core businesses.

The CNX Nifty opened at 5,682.70; about 6 points lower as compared to its previous closing of 5,688.70, and has touched a high and a low of 5,711.35 and 5,681.85 respectively.

The index is currently trading at 5,700.15, up by 11.45 points or 0.20%. There were 23 stocks advancing against 25 declines and 2 remain unchanged on the index.

The top gainers of the Nifty were Bharti Airtel up by 3.01%, BPCL up by 1.56%, Ranbaxy up by 1.47%, HDFC up by 1.30% and L&Tup by 1.18%.

On the flip side, Jindal Steel & Power down by 1.23%, NMDC down by 1.06%, Hindalco down by 1.02%, Axis Bank down by 1.01% and Reliance Infrastructure down by 0.88%, were the major losers on the index.

Most of the Asian equity indices were trading in red; Shanghai Composite dipped 3.60 points or 0.16% to 2,190.19, Hang Seng slipped 10.08 points or 0.05% to 21,559.59, Jakarta Composite declined 4.94 points or 0.10% to 4,993.71, KLSE Composite decreased 0.49 points or 0.03% to 1,710.48, Nikkei 225 dropped 26.72 points or 0.20% to 13,356.17, KOSPI Composite contracted 10.56 points or 0.55% to 1,913.28 and Taiwan Weighted was down by 1.08 points or 0.01% to 7,807.99.

On the flip side, Straits Times was up by 6.59 points or 0.20% to 3,298.05.