Benchmarks open positive tracing Asian markets

The Indian equity markets have made a positive start tracking firm cues from Asian counterparts. Most of the Asian peers were trading in the positive terrain at this point of time, moreover, Positive close for overnight Wall Street supported investors’ sentiments on reports that Greece is stepping in the right direction towards forming a new government and ensuring it receives its next round of aid. Back home BSE’s Sensex and NSE’s Nifty reclaimed their crucial 17,600 and 5,300 level as trading sentiment improved on the back of firming trend in the Asian region and encouraging earnings announced by ONGC. The net profit of the company surged by 60.36% at Rs 8,642 crore against Rs 5,389 crore for the corresponding period last year. Total income for the quarter under review increased by 24.4% to Rs 24,058.33 crore against Rs 19,336.46 crore in Q2, FY’11. Telecom stocks like Bharti Airtel, Reliance Communication and MTNL edged higher in the trade after the Telecom Regulatory Authority of India (Trai) argued that a uniform licence fee in terms of percentage share of revenues in telecom will not hurt government earnings because more services will be brought under the licence fee regime. However, PSU oil marketing companies viz. BPCL, HPCL and IOC all down by 1-3 percent as the government may further delay the rise in diesel prices after the criticism from its allies and as the move could cause further damage to government reputation ahead of key state elections. The broader indices were outperforming benchmarks. The market breadth on the BSE was positive; there were 1,020 shares on the gaining side against 545 shares on the losing side while 77 shares remained unchanged.

The BSE Sensex opened at 17,593.67; about 31 points higher compared to its previous closing of 17,562.61, and has touched a high and a low of 17,632.23 and 17,591.86 respectively.

The index is currently trading at 17,613.32, up by 50.71 points or 0.29%. There were 23 stocks advancing against 7 declines on the index.

The overall market breadth has made a strong start with 62.12% stocks advancing against 33.19% declines. The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices rose 0.47% and 0.39% respectively.

The top gaining sectoral indices on the BSE were, FMCG up by 0.65%, Metal up by 0.64%, PSU up by 0.61%, Oil and Gas up by 0.59% and CG was up by 0.48%. While, IT down by 0.26%, TECk down by 0.15% and HC down by 0.12% were the only losers on the index.

The top gainers on the Sensex were Jaiprakash Associates up by 1.96%, ONGC up by 1.93%, Hindalco up by 1.47%, M&M up by 1.18% and TCS was up by 1.08%.

On the flip side, Infosys was down by 0.82%, Cipla was down by 0.66%, Sun Pharma was down by 0.65%, Tata Motors was down by 0.48% and Bajaj Auto was down by 0.34% were the top losers on the Sensex.

Meanwhile, the fear of recession in European nations and possible slowdown in United States has affected India’s Foreign Direct Investment (FDI) inflows, which declined by 16.5% to $1.76 billion in September 2011 compared to $2.11 billion in September 2010. Whereas, in August, FDI inflow had surged by almost two-fold to $2.83 billion. 

As per a senior official of Department of Industrial Policy and Promotion (DIPP), in the first half of current financial year, the FDI increased by more than 74% to $19.13 billion from $11 billion in April-September 2010.  

Despite the weak global economic condition and economic uncertainties in major investing countries, in the current fiscal year, FDI inflows are likely to touch $35 billion in 2011-12 compared to $19.4 billion in 2010-11, on the back of major investment deals like RIL-BP and Posco.

In last financial year, FDI inflows had declined by 25% to $19.43 billion from $25.6 billion in 2009-10. During 2008-09, FDI stood at $27.3 billion. According to experts, uncertain economic conditions in the US and Europe are one of the major reasons for the declining FDI in India.

In order to attract global investors by relaxing FDI procedures, the Reserve Bank of India on November 5, stated that transfer of shares between Indians and non-residents will not require its permission in several key areas like financial services. Countries like Mauritius, Singapore, the US, the UK, the Netherlands, Japan, Germany and the UAE are major investors India.
 
The S&P CNX Nifty opened at 5,292.25; about 8 points higher compared to its previous closing of 5,284.20, and has touched a high and a low of 5,304.25 and 5,291.60 respectively.

The index is currently trading at 5,301.80, higher by 17.60 points or 0.33%. There were 36 stocks advancing against 14 declines on the index.

The top gainers of the Nifty were Cairn up by 2.69%, ONGC up by 2.13%, Rpower up by 2.01%, Jaiprakash Associates up by 1.96% and Axis Bank up by 1.83%.

On the flip side, HCL Tech down by 0.97%, BPCL down by 0.94%, Sun Pharma down by 0.84%, Cipla down by 0.78% and Infosys down by 0.67%, were the major losers on the index.

Most of the Asian counterparts were trading in the green; Shanghai Composite was up 12.16 points or 0.48% to 2,521.95, Hang Seng was up 127.02 points or 0.65% to 19,804.91, Jakarta Composite was up 23.15 points or 0.61% to 3,801.39, KLSE Composite was up 7.24 points or 0.49% to 1,484.75 and Straits Times was up 6.29 points or 0.22% to 2,854.53.

On the flip side, Nikkei 225 was down 65.43 points or 0.75% to 8,701.66, Seoul Composite was down 3.70 points or 0.19% to 1,915.40 and Taiwan Weighted was down by 7.27 points or 0.10% to 7,614.45.