Benchmarks remain volatile; Nifty trade near 5700 level

Benchmarks have erased early gains and are showing volatile trend though in a narrow range with Sensex and Nifty swinging between negative and positive zone on account of profit booking after making a higher opening on firm global cues. Meanwhile, Indian government has further relaxed foreign direct investment norms in the retail sector to attract overseas investments. The rupee today lost 27 paise to 60.70 against the dollar in early trade on the Interbank Foreign Exchange market on higher demand for the US currency from importers, even as RBI took more measures to curb the domestic unit's fall.

On the global front, Rally in Asian markets too boosted the traders’ moral with Japanese Nikkei surging over one and a half percent as weakening yen buoyed sentiment, lifting exporters like auto makers and electronics manufactures. Back home, traders were seen piling up positions in Consumer Durables, IT and Tech, while selling was seen in Metal, Power and PSU sector. Meanwhile, the NSE Nifty and BSE Sensex were trading near the psychological 5,700 and 19,200 levels respectively. The market breadth on BSE was showing negative trend with advances to declines in the ratio of 651:933.

The BSE Sensex is currently trading at 19278.47, down by 38.72 points or 0.20% after trading in a range of 19451.70 and 19273.08. There were 11 stocks advancing against 19 declines on the index. The broader indices were trading in red; the BSE Mid cap index was down by 0.55% and Small cap index lost 0.41%.

The few gaining sectoral indices on the BSE were, Consumer Durables up by 4.03%, IT up by 1.06%, Teck up by 0.81% and Oil & Gas up by 0.53%, while Metal down by 3.53%, Power down by 2.47%, PSU down by 1.99%, Auto down by 1.22% and Bankex down by 0.79% were the top losers on the BSE.

The top gainers on the Sensex were Wipro up by 2.35%, RIL up by 1.61%, Infosys up by 1.09%, TCS up by 1.09% and Maruti Suzuki up by 0.71%. On the flip side, Jindal Steel was down by 7.29%, Sterlite Inds was down by 4.05%  Coal India was down by 3.79%, Tata Steel was down by 3.07%,  and Dr Reddys Lab was down by 2.86% were the top losers on the Sensex.

Meanwhile, in a move to meet the demand of the fund-starved Telecom industry, the government has approved 100 percent foreign direct investment (FDI) in the sector. After a meeting of the Union Cabinet, Commerce and Industry Minister Anand Sharma said that they had agreed to increase FDI cap in telecom to 100 percent from 74 percent, which will include 49 percent investment through automatic route and beyond that will require the Foreign Investment Promotion Board's (FIPB) approval.

The government is of the view that increasing the FDI limit in the telecom sector will help the industry to get fresh funds to lower financial burden. Further, the move brings relief to foreign investors as they will have complete ownership and will no longer need to partner with Indian investors in order to comply with regulatory requirements.

It is expected that 100 percent FDI in the telecom sector can attract investment of $10 billion in near to long term. Telecom majors like Russian conglomerate controlled Sistema controlled SSTL, Malaysian firm Maxis controlled Aircel, Reliance Communications, Norwegian firm Telenor welcomed the decision.  The CNX Nifty is currently trading at 5,715.00 down by 12.85 points or 0.22% after trading in a range of 5,761.85 and 5,713.15. There were 16 stocks advancing against 33 declines while 1 stock remains unchanged on the index.

The top gainers of the Nifty were ACC up by 3.45%, Ambuja Cements up by 2.81%, Ranbaxy up by 2.63%, Cairn up by 1.86%,Lupin up by 1.69% .On the flip side, Power Grid down by 13.05%, Jindal Steel down by 7.17%, Bank of Baroda down by 5.20%, Coal India down by 3.89% and Sesa Goa down by 3.30% were the major losers on the index.

The Asian equity indices were trading in green; Shanghai Composite rose 11.13 points or 0.55% to 2,040.19, Hang Seng increased 123.83 points or 0.56% to 22,212.62, Jakarta Composite jumped 3.92 points or 0.08% to 4,628.26, KLSE Composite strengthened 3.67 points or 0.21% to 1,781.49, Nikkei 225 surged 319.21 points or 2.31% to 14,329.73, Straits Times improved 13.47 points or 0.42% to 3,256.03, Seoul Composite grew 0.78 points or 0.04% to 1,921.59  and Taiwan Weighted was up by 44.55 points or 0.55% to 8,100.77.