Indian equity add losses to trade in red

Indian equity markets added losses while trading weak marginally in the red almost hovering near the lowest point of the day in the late afternoon session on account of selling in front line blue chip counters and taking cues from negative opening of European market. Traders were seen piling position in FMCG, Health Care and TECK stocks while selling was witnessed in Capital Goods, Realty and Oil & Gas sector stocks. In the scrip specific development, Oil Marketing Companies stocks have come under pressure as the Competition Commission of India (CCI) has started investigation into alleged cartelization by oil marketing companies in fixing petrol prices. Larsen and Toubro, the country’s biggest engineering and construction firm slipped after posting lower than estimated profits for the March quarter. Tech Mahindra was trading in green after the software exporter reported a 24.7 percent jump in net profit for the fourth quarter ended March 31, 2013. United Spirits is trading firm in green after touching 52-week high after Morgan Stanley resumed coverage on the company with an overweight rating and an upside target price.

On the global front, the Asian markets were trading in green barring Shanghai Composite and Hang Seng while the European markets were trading on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 6,150 and 20,200 levels respectively. The market breadth on BSE was negative in the ratio of 937:1262, while 131 scrips remain unchanged.

The BSE Sensex is currently trading at 20105.13, down by 6.48 points or 0.03% after trading in a range of 20,220.35 and 20087.93. There were 16 stocks advancing against 14 declines on the index.

The broader indices have capitulated to selling pressure; the BSE Mid cap and Small cap index were trading down by 0.56% and 0.50 respectively.

The top gaining sectoral indices on the BSE were, FMCG up by 0.87%, Health Care up by 0.48%, TECK up 0.45%, IT up by 0.41% and Auto up by 0.36%, while Capital Goods down 3.01%, Realty down by 2.33%, Oil & Gas down by 1.26%, PSDU down 0.58% and Power down by 0.47% were the top losers on the BSE.

The top gainers on the Sensex were Sun Pharma up by 2.76%, Bharti Airtel up by 2.28%, Dr. Reddy’s Lab up by 1.81%, Coal India up by 1.40% and ITC up by 1.25%. On the flip side, L&T down by 4.69%, Gail India down by 1.46%, RIL down by 1.10%, BHEL was down by 1.07% and Sterlite Industries down by 0.94% were the top losers on the Sensex.

Meanwhile, Finance Minister P Chidambaram has said that competition regulation must not become another bureaucracy, stifling growth. Chidambaram has said that ‘Competition Commission of India (CCI) must be a lean organization, picking the issues it can weigh on carefully and making a difference when it does’. The ruling of the CCI must be transparent and afford clarity rather than obscurity.

The Finance Minister was of opinion that the CCI can play important role to boost sectors’ growth by keeping an eye on the benefits of competition coming from new technologies, entrants or new sectors and will ensure that the public is well served. Also, the CCI should also regulate the sectors in these matters, which is very difficult and fraught with legal difficulties. 

By adding further, finance minister said that a key issue for any competition authority is to prevent predatory behavior, which is sometime hard to distinguish from pro-consumer behavior and therefore require careful research based on the Indian experience and economic thought and experience elsewhere. The Competition Commission must develop a body of work that allows it to address these issues. The Competition Commission will play an important part in defining the role of the government as a regulator of competition and as a participant in the competitive process. 

The CNX Nifty is currently trading at 6,110.00, down by 4.10 points or 0.07% after trading in a range of 6,147.60 and 6,105.55. There were 21 stocks advancing against 27 declines while 2 stocks remained unchanged on the index.

The top gainers of the Nifty were Sun Pharma up by 2.88%, Bharti Airtel up by 2.50%, Dr. Reddy’s Lab up by 1.74%, Coal India up by 1.46% and ITC up by 1.42%. On the flip side, L&T down by 4.77%, JP Associate down by 4.36%, DLF down by 4.30%, BPCL down by 3.82%, and Bank of Baroda down by 2.29% were the major losers on the index.

Most of the Asian equity indices were trading in green; Jakarta Composite increased 0.67%, KLSE Composite surged 0.45%, Nikkei 225 soared 1.60%, Straits Times jumped 0.47%, KOSPI Composite added 0.64% and Taiwan Weighted was up by 0.19%. 

On the flip side Shanghai Composite was down by 0.12% and Hang Seng declined by 0.45%.

The European markets were trading in red; France’s CAC 40 was down 0.22%, Germany’s DAX dropped 0.10% and United Kingdom’s FTSE 100 inched lower 0.15%.