Sensex, Nifty consolidate; continue to trade in green

Indian benchmarks seem to be in consolidation phase after the strong rally in the previous session and have held on to their opening gains through the late morning session as investors added rate sensitive stocks in their portfolio on hopes of rate cuts in coming months. Sentiments have remained firm on sustained buying by participants after WPI inflation eased to over three years low, giving room for the Reserve Bank to cut interest rates, amid a firming trend in the global markets. Sentiments got some support on account of sustained flows by foreign institutional investors. FIIs bought equities worth Rs1,646 crore on Wednesday on hopes of monetary easing, after headline inflation hit a 41-month low.

On the global front, most Asian equity indices were trading higher after data showed Japan’s economy accelerated in the first three months of the year, in contrast to an enduring recession in the euro zone which was keeping the euro in the doldrums. Japanese economy grew 0.9% in the first quarter, speeding up from a 0.3% pace in the previous quarter and beating expectations for a growth rate of 0.7%. Back home, the traders were seen piling up positions in Health Care, Bankex and Oil & Gas while selling was seen in FMCG, IT and Teck sector.

In scrip specific development, Realty stocks rose for the second straight day on expectations that the RBI may further cut policy rates to perk up economic growth after the latest data showed a sharp fall in wholesale price inflation in April 2013. In scrip specific actions, Cipla spurted after shareholders of South Africa's Cipla Medpro overwhelmingly approved a $488 million takeover offer from Cipla Ltd on Wednesday, giving the Indian drugmaker a big presence in Africa's biggest economy. NTPC was trading higher after India's biggest power producer, has decided to merge affiliate NTPC Hydro (NHL) with itself as part of a restructuring exercise. Larsen & Toubro zoomed as the company is planning to raise 1 billion rupees in 10-year inflation-linked bonds at 1.65 percent over wholesale price inflation. IRB Infrastructure Developers rose after one of the largest domestic road builders on BOT mode said its net profit grew by 25.57 per cent to Rs 151.13 crore on consolidated basis for the fourth quarter ended March 31 on the back of improved performance. Bajaj Finance soared after on reporting a 52 per cent rise in net profit to Rs 164 crore for the March quarter boosted by sound growth in disbursements and core income growth. Adani Ports and Special Economic Zone surges after the company's consolidated net profit for the January-March quarter rose by 66% to Rs 710.31 crore as against Rs 239.46 crore in the year ago period. Tata Motors slumped after the global auto giant reported 7.02 per cent fall in its global sales for last month at 81,241 units. V-Guard Industries tanked after net profit declined 53.36% to Rs 8.94 crore in the quarter ended March 2013 as against Rs 19.17 crore during the previous quarter ended March 2012.Meanwhile, the NSE Nifty and BSE Sensex were trading just above their psychological 6,100 and 20,000 levels respectively. The market breadth on BSE was showing positive trend with advances to declines in ratio of 1047: 740.

The BSE Sensex is currently trading at 20299.03, up by 86.07 points or 0.43% after trading in a range of 20326.48 and 20162.12. There were 20 stocks advancing against 10 declines on the index. The broader indices were trading in green; the BSE Mid cap index was up by 0.68% and Small cap index was up by 0.48%.

The top gaining sectoral indices on the BSE were, Health Care up by 1.62%, Bankex up by 1.31%, Oil & Gas up by 1.04%,Capital Goods up by 1.03% and Power up by 0.81% while, FMCG down by 0.62%, IT down by 0.60%, Teck down by 0.36% and Consumer Durables down by 0.11% were the losers on the BSE.

The top gainers on the Sensex were Dr Reddys Lab up by 3.41%, Cipla up by 1.96%, RIL up by 1.95%, ICICI Bank up by 1.67% and SBI up by 1.66%. On the flip side, Jindal Steel was down by 1.12%, ITC was down by 1.08%, TCS was down by 0.94%,  Infosys was down by 0.81% and  Tata Motors was down by 0.75% were the top losers on the Sensex.

Meanwhile, Plethora of corruption allegations against the Union government ministers has dropped India's economic confidence by 2 points to 63 percent in the month of April, 2013 compared to the month of March, 2013 and now the country is the sixth most economically confident country in the world after Saudi Arabia, Sweden, China, Canada and Germany. 

As per a survey by global research firm Ipsos, frequent allegations of corruption is revitalizing negative public perception among Indians about the state of its economy despite indications that inflation is gradually softening and investor are increasing becoming confident about business opportunities in India.

Further, as per the survey, 4 in 10 Indian citizens (41 percent) believe that their local economy which impacts their personal finance is good, a marginal rise of 2 points, while, the 47 percent people expect the economy will be stronger in next six months. On economic growth, the lpsos’s survey said that Indian economy is expected to grow at around 6 percent in 2013-14 on account of robust domestic demand, strong savings and growth in private investment rate.

Regarding the global economies, survey said that the global assessment of national economies surveyed in 24 countries slipped slightly this month as 36 percent of global citizens rate their national economies to be ‘good’, which were down by 1 percent from last month. It noted that Saudi Arabia (80 percent) continued to lead the world on national economic assessment, despite seeing a downward trend over the past quarter, followed by Sweden (73 percent), China (72 percent), Canada (65 percent), Germany (64 percent) and India (63 percent).  The CNX Nifty is currently trading at 6,174.80 up by 28.05 points or 0.46% after trading in a range of 6,187.30 and 6,128.25. There were 34 stocks advancing against 15 declines while 1 stock remained unchanged on the index.

The top gainers of the Nifty were Dr. Reddy's Laboratories up by 3.36%, DR Reddy up by 3.06%, Cipla up by 2.31%, Reliance Infrastructure up by 2.26%, and IDFC up by 2.18%. On the flip side, Jindal Steel down by 1.30%, TCS down by 1.12%, ITC down by 1.05%, Infosys down by 0.94% and NMDC down by 0.86% were the major losers on the index.

Most of the Asian equity indices were trading in green; Shanghai Composite rose 21.77 points or 0.98% to 2,246.57, Hang Seng increased 93.57 points or 0.41% to 23,137.81, Jakarta Composite jumped 15.24 points or 0.30% to 5,105.12, KOSPI Composite added 17.32 points or 0.88% to 1,988.58 and Taiwan Weighted was up by 76.70 points or 0.92% to 8,395.29.

On the flip side, KLSE Composite declined 12.37 points or 0.69% to 1,770.66, Nikkei 225 tumbled 145.89 points or 0.97% to 14,950.14 and Straits Times was down by 0.08 points to 3,441.45.