Firm trade prevails; Nifty holds 6,000 mark

Indian equity markets continued firm trade in the late afternoon session on account of buying in front line blue chip counters. The sentiments on the street turned pessimistic despite India’s headline inflation stood at 4.89% in April, putting it back in the Reserve Bank’s comfort zone for the first time in more than three years and fuelling market hopes for more monetary easing to revive the economy's pedestrian growth rate. Traders were seen piling position in Oil & Gas, Realty and Health Care stocks while selling was witnessed in Consumer Durables sector stocks. In scrip specific development, Eicher Motors was trading firm touching 52-week high after the commercial vehicle maker posted better than expected consolidated profit after tax at Rs 132.8 crore for the quarter ended March 31. On the global front, the Asian markets were trading on a mixed note, while the European markets were trading on pessimistic note.

Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,000 and 19,700 levels respectively. The market breadth on BSE was negative in the ratio of 1054:1143, while 127 scrips remain unchanged.

The BSE Sensex is currently trading at 19765.24, up by 73.57 points or 0.37% after trading in a range of 19831.79 and 19652.69.

The broader indices too pared off some gains; the BSE Mid cap and Small cap index were trading up by 0.22% and 0.08% respectively.

The gaining sectoral indices on the BSE were, Oil & Gas up by 0.81%, Realty up by 0.79%, Health Care up by 0.58%, PSU up by 0.54% and TECK up by 0.50% while Consumer Durables down by 1.01% was the only loser on the BSE sectoral space.

The top gainers on the Sensex were Gail India up by 2.06%, Tata Motors up by 2.02%, Bharti Airtel up by 1.96%, ONGC up by 1.62% and Hindalco Industries up by 1.34%. On the flip side, Dr. Reddy’s Lab down by 1.97%, Bajaj Auto was down by 0.76%, BHEL was down by 0.53%, NTPC was down by 0.45% and Wipro was down by 0.42% were the top losers on the Sensex.

Meanwhile, concerned over the increasing pressure on finances owing to uncertainty on economy and policy front, infrastructure majors as well as representatives from the banking sector have approached the Prime Minister's Office (PMO) and the planning Commission Deputy Chairman Montek Singh Ahluwalia to set up an independent regulatory body with the authority to alter existing contracts in projects under the Public Private Partnership (PPP) model. 

They are of the opinion that in absence of such a mechanism, private sector are skeptical about how much they can contribute to the government's ambitious $1 trillion investment plan for infrastructure. The Chairman of the CII Core Group on Roads has said that the PPPs model lacks in risk allocation and private sector participation in infrastructure project is transferring a lot of risks like increase in capital cost, operating & maintenance cost and financing cost. Therefore, there is a need for regulatory authority for the proper risk allocation under PPP model and its decision should be full and final.

The investment in existing and new infrastructure projects involves high risks, low returns, huge capital, high incremental capital/ output ratio, long payback periods as well as superior technology. Hence, in order to bring in adequate resources for setting up of a sound and efficient infrastructural base, the government has entered into the 'Public Private Partnership (PPP)' programme.

The CNX Nifty is currently trading at 6,010.25, up by 29.80 points or 0.50% after trading in a range of 6,026.20 and 5,970.05. There were 37 stocks advancing against 12 declines on the index, while 1 stock remained unchanged.

The top gainers of the Nifty were Ranbaxy Laboratories up by 2.80%, GAIL were up by 2.14%, Tata Motors up by 1.98%, Bharti Airtel up 1.97% and Power Grid up by 1.78%. On the flip side, Dr. Reddy’s Lab down by 1.74%, HCL Technologies down by 1.70%, Bajaj-Auto down by 0.95%, BHEL down by 0.74% and NTPC down by 0.55% were the major losers on the index.

The Asian equity indices were trading on a mixed note; Jakarta Composite was up 0.08%, Taiwan Weighted was up by 0.04%, Straits Times added 0.08% and KOSPI Composite gained 1.03%.On the other hand, Shanghai Composite plunged by 1.11%, Hang Seng was lower by 0.26%, KLSE Composite decline by 0.01%, Nikkei 225 was down by 0.16%.

The European markets were trading in red; France’s CAC 40 was down 0.46%, Germany’s DAX lost 0.29% and United Kingdom’s FTSE 100 edged lower by 0.08%.