Benchmarks pare gains; Nifty holds 5,400 mark

Indian equity markets pared gains but continue to trade firm in the late afternoon session on account of profit booking in front line counters, taking cues from weak European counterparts. The sentiments were on optimistic mood after Reserve Bank of India (RBI) issued clarification on its recently revised Overseas Direct Investment Guidelines, which also has led to substantial recovery of rupee. Traders were seen piling position in Auto, Oil & Gas and Metal stocks while selling was witnessed in Realty and FMCG sector stocks. Realty stocks continue to reel under pressure after RBI stated that housing loans from banks to individuals should be closely linked to the stages of construction. In scrip specific development, Jet Airways (India) was trading in green on reports that Etihad is likely to complete its purchase of a 24% stake in the company by September 20, 2013. IPCA Laboratories was trading in green after the pharma company received approval from USFDA for Indore manufacturing facility. Fresenius Kabi Oncology was trading firm after the government approved Rs 349 crore FDI proposal of the company.

On the global front, all the Asian markets were trading in red barring Shanghai Composite and Nikkei 225 while the European markets were too trading on pessimistic note.  Back home, the NSE Nifty and BSE Sensex were trading above their psychological 5,400 and 18,400 levels respectively. The market breadth on BSE was positive in the ratio of 1199:827, while 174 scrips remain unchanged. 

The BSE Sensex is currently trading at 18410.88, up by 176.22 points or 0.97% after trading in a range of 18612.60 and 18,188.43. There were only 25 stocks advancing against 5 declines on the index.

The broader indices were too trading in green; the BSE Midcap and Smallcap indices were trading higher by 0.57% and 0.46%.

The top gaining sectoral indices on BSE were Auto up 2.03%, Oil & Gas up by 1.68%, Metal up by 1.68%, TECK up by 1.56% and IT up by 1.50% were the top gainers on BSE. On the other hand, Realty down by 1.10% and FMCG down 0.76% were the only indices trading in red on BSE.

The top gainers on the Sensex were, BHEL up by 5.36%, Tata Motors up by 4.32%, Bharti Airtel up by 3.33%, Hindalco Industries up by 3.26% and ICICI Bank up by 2.57%. On the flip side, ITC down by 1.92%, Maruti Suzuki down by 1.17%, HDFC Bank down 0.52%, Sun Pharma down by 0.28% and Hindustan Unilever down 0.23% were the top losers on the Sensex.

Meanwhile, the Reserve Bank of India (RBI), in its half yearly report on management of foreign exchange reserves, has said that India's external debt profile has deteriorated over a period of time with significant rise in volatile capital and decline in import cover.

The central bank stated that the ratio of volatile capital flows include cumulative portfolio inflows and short-term debt to the reserves increased to 96.1 at end-March 2013 from 83.9 per cent as at end-September 2012. While, the country's foreign exchange reserves at end-March 2013 equaled to the nation's import cover of 7 months, down from 7.2 months at end-September 2012. India’s foreign exchange reserves came down to $292.0 billion at the end-March 2013 from $294.8 billion at end-September 2012, the RBI’s report added.

By adding further, central report said that the other external debt parameter of the country which relates to the portion of short-term debt in the total debt too showed deterioration. The ratio of short-term debt to the foreign exchange reserves, increased to 33.1 per cent at end-March 2013 from 28.7 percent recorded in end- September 2012.

The CNX Nifty is currently trading at 5,401.85, up by 60.40 points or 1.13% after trading in a range of 5,460.25 and 5,318.90. There were 39 stocks advancing against 11 declines on the index.

The top gainers of the Nifty were Ranbaxy Laboratories up by 9.02%, BHEL up by 5.33%, IndusInd Bank up by 4.51%, Tata Motors up by 4.12% and Lupin up by 3.61%. On the flip side, DLF down by 1.89%, ITC down by 1.65% Maruti Suzuki down by 1.57%, Sun Pharma down 1.33% and PNB down by 1.27% were the major losers on the index.

Most of the Asian equity indices were trading in red; Straits Times down by 1.20%, Hang Seng down by 0.31%, Jakarta Composite down by 2.06%, Taiwan Weighted down by 0.06%, KLSE Composite down by 0.34% and Seoul Composite down by 0.04%. On the flip side, Shanghai Composite was up by 0.21% and Nikkei 225 up by 0.54%.

The European markets were trading in red; France’s CAC 40 was down 0.70%, Germany’s DAX lost 0.38% and UK’s FTSE 100 dropped 0.57%.