Benchmarks continue to trade in negative terrain; IT counter up on renewed buying

Benchmark equity indices after drifting lower in late morning deals, continue to trade in negative terrain though selling pressure has with arrested. A little recovery appears to be in sight given that lower market level usually drives bargain hunters to shop for fundamentally strong bets available at lucrative valuations. While, 50 share index, Nifty, was trading above its crucial 5800 mark, Sensex continued to gyrate below 19100 with loss close to half a percent. Broader indices, continued to trade mixed.

On the global front, Asian shares and other riskier assets lost ground on Tuesday after a preliminary reading showed manufacturing growth in China slowed in April, highlighting recent market concerns about global growth prospects. The flash HSBC Purchasing Managers' Index for April fell to 50.5 in April from 51.6 the month before as new export orders shrank in China, suggesting the country faces considerable headwinds. Meanwhile, European shares received a boost at the open on Tuesday as the first in a raft of manufacturing data was released for the euro zone. French PMI data came in better-than-expected with a composite figure of 44.2 for April against 41.9 last month.

Closer home, beaten out Information Technology counter continued to lead the pack of gainers on BSE sectoral front, following the suit were Metal and Health Care counters. Information Technology stocks after being badgered in the previous couple of trading session were trading higher on renewed buying activity. On the flip side, Capital Goods, Banking and Realty counters were the laggard of trade. The overall market breadth on BSE is in the favour of declines which have thumped advances in the ratio of 1137:909, while 115 shares remained unchanged.

The BSE Sensex is currently trading at 19070.10, down by 99.73 points or 0.52% after trading in a range of 19210.26 and 19042.08. There were 14 stocks advancing against 16 declines on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.70% and Small cap index was up by 0.14%.

The top gaining sectoral indices on the BSE were, IT up by 0.79%, TECk up by 0.43%, Metal up by 0.10%, Health Care up by 0.01%, while Capital Goods down by 1.85%, Bankex down by 1.69%, Realty down by 1.65%, Consumer Durables down by 0.81% and PSU down by 0.74% were the top losers on the BSE.

The top gainers on the Sensex were Bajaj Auto up by 1.66%, Reliance up by 1.05%, Wipro up by 1.00%, Infosys and Reliance Industries were trading up by 0.92%.

On the flip side, L&T down by 2.79%, Tata Motors down by 2.38%,  SBI down by 2.32%, Jindal Steel down by 2.21% and BHEL down by 1.88% were the top losers on the Sensex.

Meanwhile,the foreign direct investment (FDI) in India declined by 19 percent in February, 2013 to $ 1.79 billion from the $ 2.15 billion recorded in the same month of previous year, owing to the prevailing global economic slowdown. During the April-February period of FY13, FDI has declined by 38 percent to $20.89 billion from $33.49 billion in the corresponding period last year.

The sectors which have received maximum FDI during the first 11 months of the FY13 include services ($4.74 billion), hotel and tourism ($3.21 billion), metallurgical ($1.39 billion), construction ($1.26 billion) and Pharmaceuticals ($1.11 billion). Country wise, India received maximum FDI from Mauritius ($8.97 billion), followed by Japan ($2.11 billion), Singapore ($1.98 billion), the Netherlands ($1.67 billion) and the UK ($1.06 billion). 

Foreign investment is considered crucial for economic development of a country and the decline in foreign investments could put pressure on the country’s balance of payments and may also impact the value of the rupee. However, to attract maximum foreign investment into the country, the government has been liberalizing the foreign investment policy. Recently, the finance minister had visited several major financial markets like Canada, Hong Kong, Germany, Singapore, Canada, and the UK to attract foreign investors.

The CNX Nifty is currently trading at 5,800.30, down by 34.10 points or 0.58% after trading in a range of 5,843.35 and 5,791.55. There were 20 stocks advancing against 30 declines on the index.

The top gainers of the Nifty were JP Associate up by 1.75%, Bajaj-Auto up by 1.65%, HCL Tech up by 1.23%, Infosys up by 1.01% and Reliance up by 0.93%.

On the flip side, IndusInd Bank down by 3.07%, Bank of Baroda down by 2.88%, L&T down by 2.73%, IDFC down by 2.45% and Tata Motors down by 2.42% were the major losers on the index.

All the Asian equity indices were trading in red; Shanghai Composite tumbled 2.58%, Hang Seng declined 1.15%, Jakarta Composite slipped 0.23%, KLSE Composite contracted 0.37%, Nikkei 225 dipped 0.29%, Straits Times decreased 0.59%, KOSPI Composite dropped 0.40% and Taiwan Weighted was down by 0.35%.

European shares got off to a positive start; with CAC 40 gainning 0.88%, DAX adding 0.23% and FTSE 100 rising by 0.17%.