Benchmarks trade listless; negative European markets opening weighs

In the lackluster session of trade, benchmark equity indices are trading quite listless in absence of fresh buying by investors, which have adopted a cautious approach ahead of release of Consumer Price Index (CPI) and Industrial Production data on May 10. Meanwhile, negative global set-up is also dissuading market-men from building any fresh positions in a market which soared to three months high level in the previous session. Benchmark 30-share index, Sensex, is hovering below 20,000 level, while 50-share index, enticing slender gains, is trading above its crucial 6,050 level. Broader indices, also outperforming the frontline equity indices, are trading with gains of 1/10 of a percent.

On the global front, European stocks got off to a negative start even as investors awaited the Bank of England's decision on continuing economic stimulus and as the Bank of Korea cut interest rates. Meanwhile, Asian pacific shares too giving into selling pressure were trading mixed at this point of time. Stocks in South Korea mainly led gains in Asia in early trade after its central bank unexpectedly cut interest rates.

Closer home, stocks from Information Technology, Public  Sector Undertaking, Auto and Bankex counters were capping the downtrend of bourses, while, stocks from Health Care, Metal and Capital Goods counters were underscoring the underlying weakness of markets after previous session’s rally.  Meanwhile, strong gains of Punjab National Bank, also spelled some optimism for banking pivotal. The stock soared close to 5% after the company reported an improvement in asset quality, which has been a big concern for public sector banks. Net non-performing asset (NPA) declined to 2.35% of advances for the quarter ended March, 2013 against 2.56% of the advances in the quarter ended December, 2012. However, the bank posted a 20.6% fall in net profit for the quarter ended March, 2013 at Rs 1,130 crore.  The overall market breadth on BSE is in favour of declines, which have thumped advances in the ratio of 1130: 995; while 140 shares remain unchanged.

The BSE Sensex is currently trading at 19,987.78, down by 2.40 points or 0.01% after trading in a range of 20,058.48 and 19,941.35. There were 15 stocks advancing against 15 declines on the index and one remains unchanged.

The broader indices were trading in green; the BSE Mid and Small cap index were trading up by 0.13% and 0.14% respectively.

The top gaining sectoral indices on the BSE were, IT up by 1.16%, Teck up by 0.93%, PSU up by 0.34%, Auto up by 0.29% and Bankex up by 0.14%, while Health Care down by 1.00%, Metal down by 0.54%, Capital Goods down by 0.51%, Oil & Gas down by 0.47% and Power down by 0.31% were the top losers on the sectoral index.

The top gainers on the Sensex were SBI up by 1.80%, TCS up by 1.55%, Mahindra & Mahindra up by 1.21%, Hero MotoCorp up by 0.84% and ONGC up by 0.83%.

On the flip side, Sun Pharma down by 2.60%, Jindal Steel down by 1.43%, Sterlite Industries down by 1.32%, Reliance down by 1.25% and BHEL down by 0.95% were the top losers on the Sensex.

Meanwhile, the government is planning to allow gas-powered projects to import the fuel and pass on the incremental costs as higher charges. The plan, similar to the one being worked out for coal-based power projects, is in the initial stages and will help stranded gas-fuelled power generation capacity languishing in the country, thereby boost the flagging economic growth.

The cabinet committee on economic affairs on 22 April asked the ministries of coal and power to draft a proposal within three weeks that allows for the pass-through of the additional fuel costs. This also comes at a time when an empowered group of ministers (eGoM) is to consider a revision in gas prices based on the recommendations of C. Rangarajan, chairman of the Prime Minister’s economic advisory council, according to whose formula the new price will be around $8.4 per million British thermal units (mmBtu). The current price of domestic gas in India ranges between $3.5 and $5.73 per mmBtu. Imported natural gas costs around $14 per mmBtu.

In addition, the power ministry is also working on a so-called peaking power policy for gas that will encourage power distribution companies (discoms) to invite bids from generation utilities for meeting power shortages during peak consumption hours—normally between 8am and 11am and 6.30pm and 10pm. The power ministry has also asked eGoM to consider power plants in the priority sector for gas allocation.

The CNX Nifty is currently trading at 6,072.50, up by 3.20 points or 0.05% after trading in a range of 6,084.70 and 6,053.95. There were 24 stocks advancing against 25 declines while 1 stock remains unchanged on the index.

The top gainers of the Nifty were PNB up by 4.93%, HCL Tech up by 3.71%, Bank of Baroda up by 2.01%, SBI up by 1.79% and Ambuja Cement up by 1.63%. On the flip side, Sun Pharmaceuticals down by 2.78%, Jindal Steel down by 1.76%, Axis Bank down by 1.73%, Ranbaxy down by 1.63% and NMDC down by 1.48%, were the major losers on the index.

Asian equity indices were trading mixed; Straits Times surged 0.51%, KOSPI Composite soared 1.18% and Taiwan Weighted was up 0.23%.

On the flip side, Nikkei 225 down by 0.66%, Shanghai Composite declined 0.67%, Hang Seng contracted 0.19% and KLSE Composite down by 0.39%. Indonesian market remained shut for the trade today.

European markets mostly got off to a negative start; with CAC 40 declining by 0.89%, DAX sliding by 0.13% and FTSE 100 trading on flat to positive note.