Post session - Quick review

“Consolidation” was the outcome of the day as the rally witnessed for the third consecutive session fizzled out by the end of the trade since investor's lacking the conviction in the upside of the bourses took profits off the table. Earlier, barometer gauges extending the previous sessions jubilant mood commenced the session with a bang as the pledge taken by European leaders to defend the region's banks against a continent-wide debt crisis boosted the demand for risky equities. However, “volatility” remained at the fore going ahead of the second quarter earnings season, which would kick off with Infosys reporting its Q2 numbers tomorrow. Fears that the central bank may continue to raise policy rates to tame inflation despite domestic growth worries also added to the investor’s angst, who squared off their hefty position, placed during the past few sessions. Meanwhile, some investor’s also preferred staying on the sidelines ahead of the release of IIP numbers. The expectation is that Industrial output probably grew 5.0 percent in August from a year earlier, on a favourable statistical base effect, despite successive rate rises slackening the pace of growth.

The global front which earlier prompted gains of the bourses, later on became the reason for its downfall. Overnight, U.S. stocks jumped 3 percent on Monday, extending gains into a second week as a pledge by German and France leaders boosted hopes that the euro-zone debt crisis may be resolved. Meanwhile, Asian pacific stocks showcasing shining performance for yet another session, ended the day with massive gains. However, weakness entered into the equity markets with the opening of the European markets as the European stocks fell on Tuesday, as investors focused on Slovakia's parliamentary vote to ratify an expansion of the euro zone's rescue fund. Slovakia is the last of the 17-member bloc yet to vote on a deal agreed by the region's leaders in July to boost the size and powers of the European Financial Stability Facility (EFSF).

On the home turf, the early mount of gains could also contributed to the surge of the telecom stocks. Stocks like Bharti Airtel, Idea Cellular, MTNL and Reliance Communication shored up for the second straight session after the government unveiled a new policy that would help users to avail free roaming services across the country and inter-circle mobile number portability. Kapil Sibal, the Union Minister of Communications released the new telecom policy draft, which would revamp the sector and strive to achieve cent percent rural tele-density by 2020.  However, the silence over the details for future M&A rules and on key issues such as pricing of second-generation spectrum, a proposed one-time levy on mobile firms for additional spectrum they already hold and proposed re-farming of spectrum at the time of license renewal, later on pared their gains. Though on the BSE sectoral font, 8 index pivotal ended in green but the losses witnessed by the remaining 5 index pivotal undid all the good work done by the bourses, thereby prompting the bourses to end their 2 days winning streak. Stocks from CD, Metal and Auto counters featured in the list of the best performers, while stocks from IT, TECk and  Oil & Gas remained the week spells.

Though the 30 share volatile index on Bombay Stock Exchange (BSE) ended the day in red but then the domestic barometer index held onto its crucial 16500 level. The widely followed 50 share index- Nifty-too ended the day flat with negative bias. However, the broader indices, showcasing exceptional trend, ended the day with gains of over 0.25% each. The market breadth on the BSE ended positive; advances and declining stocks were in a ratio of 1535:1256 while 103 scrips remained unchanged.

The BSE Sensex lost 40.54 points or 0.24% and settled at 16,516.69. The index touched a high and a low of 16,774.12 and 16,510.71 respectively. 15 stocks advanced against 14 declining ones while 1 stock remained unchanged on the index (Provisional)

The BSE Mid-cap index gained 0.44% while Small-cap index was up by 0.18%. (Provisional)

On the BSE Sectoral front, Consumer Durables up 1.13%, Metal up 0.79%, Auto up 0.74%, Health Care up 0.71% and Capital Goods up 0.56% were the top gainers while, IT down 2.87%, TECk down 1.62%, Oil & Gas down 0.68%, FMCG down 0.43% and Realty down 0.02% was the only losers.

The top gainers on the Sensex were Sun Pharma up 3.81%, NTPC up 3.34%, Tata Motors up 3.31%, Bharti Airtel up 2.93% and Jindal Steel up 2.69%.

On the flip side, Infosys down 3.29%, Wipro down 2.60%, TCS down 2.56%, ONGC down 1.96% and BHEL down 1.94% were the top loser on the index. (Provisional)
Meanwhile, With a view to make the country's telecommunications sector transparent and give a level playing field to all service providers, the Department of Telecommunications (DoT) has come up with its new draft of the National Telecom Policy 2011. Kapil Sibal, the Union Minister of Communications released the new telecom policy draft, which would revamp the sector and strive to achieve cent percent rural tele-density by 2020.

National Telecom Policy-2011 is designed to ensure that India plays this role effectively and transforms the socio-economic scenario through accelerated equitable and inclusive economic growth by laying special emphasis on providing affordable and quality telecommunication services in rural and remote areas. The draft advocates for one nation-one licence policy across the country, which implies removal of roaming charges and also achieve full mobile number portability.

Kapil Sibal opined that under the new policy, cellular spectrum will be priced on a market basis and will be separated from the allocation of licenses and it along with its uses would be subject to audit. The minister also was of the opinion that broadband should penetrate into homes of the masses. NTP-2011 has the vision “Broadband on Demand” and envisages leveraging telecom infrastructure to enable all citizens and businesses, both in rural and urban landscape, to participate in the Internet and web economy thereby ensuring equitable and inclusive development across the nation. In order to achieve this target, the ministry is expected to auction 500 Mhz of additional spectrum by 2020 - with 300 Mhz of that coming up over the next five years.

A concerted effort to boost manufacturing activity is now exigent as robust economic growth in the country is leading to an extraordinarily high demand for electronic products in general and telecom products in particular. NTP-2011 provides a roadmap for India to become a leader in cutting edge, state of the art technologies through R&D and creation and incorporation of Indian IPRs in global standards.

In India, as of September, 2011, there are over 850 million mobile subscribers and over 90% of villages have mobile coverage.The National Telecom Policy-2011 envisions providing the people of India, secure, reliable, affordable and high quality converged telecommunication services anytime, anywhere.  Other key areas the draft policy deals with are the convergence of networks, services and technologies across voice, video, data as well as broadcasting; the promotion of local manufacturing, and the creation of a corporation to fund telecom projects.Overall, the thrust of this policy is to underscore the imperative that sustained adoption of technology would offer viable options in overcoming developmental challenges in education, health, employment generation, financial inclusion and much else.

India VIX, a gauge for market’s short term expectation of volatility gained 0.89% at 30.30 from its previous close of 30.03 on Monday. (Provisional)

The S&P CNX Nifty lost 12.30 points or 0.25% to settle at 4,967.30. The index touched high and low of 5,045.10 and 4,964.00 respectively. 32 stocks advanced against 18 declining ones on the index. (Provisional)

The top gainer on the Nifty were, Sun Pharma up 3.88%, NTPC up 3.22%, Sesa Goa up 3.17%, Tata Motors up  2.64% and SAIL up 2.41%.

 On the other hand, Infosys down 3.50%, HCL Tech down 2.95%, TCS down 2.79%, Wipro down 2.41% and ONGC down 2.11% were the top losers. (Provisional)

The European markets are trading in red, with France's CAC 40 down 0.70%, Germany's DAX down 0.69% and FTSE 100 down 0.76%.