Indian equities take a U-turn; spike up to trade in green

Indian equity markets suddenly spiked up from the lower levels of the day and added gains to trade above neutral line in the late afternoon session on account of buying in front line blue chip counters. The sentiments got some respite after Barclays Capital in its report stated that it expects another 75 bps of rate cuts over the rest of 2013 versus its previous call of 25 bps in easing due to slowing inflation and weakening economic growth. Traders were seen piling position in IT, TECK and Capital Goods stocks while selling was witnessed in Auto, Realty and Health Care sector stocks. In the scrip specific development, Coal India was trading firm after the company reported a 90% jump in standalone net profit for the fourth quarter ended March 31. Colgate was trading in red after brokerage house CITI maintained its sell rating on oral healthcare major citing expensive valuations as the main reason. Divis Laboratories was trading weak after its fourth quarter (January-March) earnings fell short of market expectations.

On the global front, the Asian markets were trading on a mixed note while the European markets were too trading on mixed note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,150 and 20,200 levels respectively. The market breadth on BSE was negative in the ratio of 942:1229, while 131 scrips remain unchanged.

The BSE Sensex is currently trading at 20,267.35, up by 43.37 points or 0.21% after trading in a range of 20,308.04 and 20,130.61. There were 15 stocks advancing against 14 declines while 1 stock remain unchanged on the index.

The broader indices were reeling under pressure; the BSE Mid cap and Small cap index were trading down by 0.02% and 0.08% respectively.

The top gaining sectoral indices on the BSE were, IT up by 1.18%, TECK up by 0.87%, Capital Goods up by 0.49%, Consumer Durables up 0.38% and Bankex up by 0.36% while Auto down by 1.09%, Realty down by 0.84%, Health Care down by 0.58%, Power down by 0.21% and Metal down 0.16% were the top losers on the on the BSE.

The top gainers on the Sensex were BHEL up by 2.28%, Coal India up by 2.24%, ICICI Bank up by 1.84%, Infosys up by 1.29% and TCS up by 1.23%. On the flip side, NTPC down by 2.83%, Tata Motors down by 2.15%, Maruti Suzuki down by 1.84%, Dr. Reddy’s Lab down by 1.20% and Mahindra & Mahindra down by 1.10% were the top losers on the Sensex.

Meanwhile, concerned over the rising fraudulent money raising activities, Corporate Affairs Minister Sachin Pilot said the government is making all efforts to ensure that entities do not misuse existing loopholes to defraud investors.  As per Pilot, Corporate Affairs Ministry and other regulators (SEBI and RBI) have initiated actions against fraudulent investment schemes in the wake of Saradha scam.

Further, an Inter Ministerial Group (IMG) has been set up to discuss ways to tackle fraudulent investment schemes after Kolkata-based Saradha Group scam that allegedly duped lakhs of investors of their savings. 

Further, SEBI has asked for more powers to tackle these issues and the ministry is willing to help it, he added.  Generally collective investment schemes come under the purview of capital market regulator SEBI while many schemes such as chit funds are exempted from its ambit. 

Earlier the minister had written to all state governments about companies having dubious investment schemes cropping up in different parts of the country. Further, there are compliance issues besides issues in detecting companies on how they misuse the funds, Pilot added.  

The CNX Nifty is currently trading at 6,167.25, up by 10.35 points or 0.17% after trading in a range of 6,180.25 and 6,119.70. There were 21 stocks advancing against 29 declines on the index.

The top gainers of the Nifty were BHEL up by 2.40%, Coal India up by 2.19%, ICICI Bank up by 1.86%, HCL Technologies up by 1.68% and TCS up by 1.68%. On the flip side, UltraTech Cement down by 3.84%, NTPC down by 3.23%, Tata Motors down by 1.94%, Maruti Suzuki down by 1.87% and JP Associate down by 1.69%, were the major losers on the index.

The Asian equity indices were trading mixed; Hang Seng declined 0.54%, Jakarta Composite dropped 0.87%, Straits Times contracted 0.41% and KOSPI Composite decreased 0.07%.

On the flip side, Shanghai Composite up by 0.22%, Nikkei 225 up by 0.13%, KLSE Composite was up 0.55% and Taiwan Weighted up by 0.07%.

The European markets were trading on a mixed note; France’s CAC 40 was down 0.50%, Germany’s DAX dropped 0.12% and United Kingdom’s FTSE 100 inched higher 0.19%.