Indian equities consolidate around neutral line in noon trades

Indian frontline equity indices continue to trade on a lackluster note in Thursday afternoon trades as they gyrate around the previous closing levels. The local benchmarks lacked fervor to tread to higher levels as lingering turbulences over the Euro-zone debt continued to dissuade market participants from taking larger bets. Investors remained unwilling to pile up fresh positions as lack of concrete measures to avert the Euro-zone’s debt debacle undermined sentiments. Meanwhile, the Asian markets too failed to give any direction to the local bourses as it traded on mixed note while the European futures indicated that the markets there may extend decline, before France and Spain seek to sell bonds amid surging yields. Back home, the notable moderation in India’s weekly inflation numbers too failed to underpin sentiments. India's food inflation declined for the second consecutive week to 10.63% in the week ended November 05. On the BSE sectoral front, the rate sensitive Realty and Bankex counters witnessed some buying interests after the encouraging weekly inflation numbers and climbed by well over half a percent. However, the hefty position squaring in the Oil & Gas pocket especially in index heavyweight Reliance which plunged by 1.70% prevented the frontline indices from moving to higher levels. Some selling pressure was also evident in the PSU and defensive FMCG counters which lost around half a percentage point.

Moreover, the broader markets too traded on a quite note with marginal gains, in tandem with their larger peers. While the bourses consolidated on good volumes of over Rs 0.50 lakh core while the market breadth on BSE was in favor of declines in the ratio of 1409:1145 while 122 scrips remained unchanged.

The BSE Sensex is currently trading at 16,778.81 up by 2.94 points or 0.02% after trading as high as and 16,807.15 as low as 16,656.92. There were 16 stocks advancing against 14 declines on the index.

The broader indices were trading in the positive zone; the BSE Mid cap index added 0.17% and Small cap rose 0.04%.

On the BSE sectoral space Realty up 0.84%, Bankex up 0.67%, Metal up 0.30%, TECk up 0.23% and IT up 0.07% were the only gainers while Oil & Gas down 1.23%, PSU down 0.49%, FMCG down 0.34%, Power down 0.30% and Auto down 0.17% were the major losers in the space.

Hindalco up 3.12%, Tata Steel up 2.14%, Sun Pharma up 2.08%, Hero Moto up 1.89% and SBI up 1.82% were the major gainers on the Sensex, while Coal India down 2.24%, Maruti down 1.84%, Reliance down 1.74%, Wipro down 1.20% and ITC down 0.97% were the major losers on the index.

Meanwhile, at a time when India’s economic growth is showing signs of slowing down and developed economies are on the verge of recession, the Ministry of Labour released its Quarterly Quick Employment Surveys on employment in the eight selected sectors, which showed that overall employment rose by 2.15 lakh during the June quarter. The surveys conducted by Labour Bureau assess the impact of economic slowdown on employment in India.

According to the figures released by Labour Ministry, hiring in the eight selected sectors viz. Textiles including Apparels, Leather, Metals, Automobiles, Gems &Jewellery, Transport, IT/BPO and Handloom/Powerloom, grew 2.15% during April-June 2011, compared to 1.74% in the previous quarter and 1.62% a year ago.  However, Textiles and Transport were the two sectors were employment got impacted due to global financial crisis and economic slowdown in India and hiring declined by 0.33% and 0.02% respectively. 

On the sectoral front, the IT/BPO sector registered the highest growth of 1.64 lakh in employment during the period June 2011 over March 2011, followed by rise of 0.53 lakh in Metals, 0.18 lakh in Automobiles, 0.13 lakh in Gems & Jewellery and 0.01 lakh in Leather and Handloom/Powerloom sectors each.

The maximum increase in overall employment by 1.90 lakh is seen in the direct category of workers as compared to 0.25 lakh in the contract category of workers at overall level during the period June 2011 over March 2011. In the export oriented units, the employment at the overall level has increased by 0.67 lakh whereas in the non-exporting units, it has increased by 1.48 lakh during the period June 2011 over March 2011.

While comparing the results of the last four quarterly surveys conducted during 2010-11 i.e. June 2011 over June 2010, the overall employment has increased by 10.31 lakh, with highest increase of 7 lakh in IT/BPO followed by 1.31 lakh in Textiles including Apparels, 0.96 lakh in Metals, 0.78 lakh in Automobiles, 0.16 lakh in Transport and 0.13 lakh in Leather during the period.

The S&P CNX Nifty is currently trading at 5,024.00, lower by 6.45 points or 0.13% after trading as high as 5,036.80 and as low as 4,992.20. There were 23 stocks advancing against 27 declines on the index.

The top gainers on the Nifty were Hindalco up 2.96%, Hero Moto up 2.28%, R Infra up 2.28%, Sun Pharma up 2.07% and Tata Steel up 2.04%.

SAIL down 2.99%, Dr Reddy’s down 2.76%, Coal India down 2.07%, Maruti down 1.96% and Reliance down 1.78% were the major losers on the index.

Asian markets traded on a mixed note, Shanghai Composite added 0.02%, Nikkei 225 gained 0.19%, Seoul Composite surged 1.11% and Taiwan Weighted rose 0.01%.

On the flipside, Hang Seng declined 0.44%, Jakarta Composite shed 0.48%, KLSE Composite eased 0.15%, Straits Times declined 0.60%.