Benchmarks witness consolidation in early deals ahead of Infosys numbers

After witnessing over a percent rally in previous session, Indian equity benchmarks are consolidating ahead of Infosys Q2 FY14 numbers slated to be announced tomorrow. Some support came in from Planning Commission Deputy Chairman Montek Singh Ahluwalia’s statement that India’s GDP will see a turnaround in the coming quarters on account of various steps taken by the government to spur growth as well as good agricultural production. However, investors remained concerned as the International Monetary Fund, after a day of lowering its growth forecast for India, said that the country’s fiscal deficit is expected to increase to 8.5 percent of the GDP this financial year, mainly due to the downward revision in GDP growth, depreciation of rupee and higher global oil prices.

Global cues remained supportive as most of the Asian equity benchmarks were trading in the green at this point of time with Japanese Nikkei trading higher by over half a percent after core machine orders in Japan increased a seasonally adjusted 5.4 percent in August compared to the previous month. The US markets got some respite on Wednesday, but the major indices made a mixed closing as the trades remained choppy.

Back home, Indian rupee weakened in early trades on account of importers rushing to cover up their near term requirements ahead of the US debt payment deadline. The rupee was at 62.22 per dollar mark compared with previous close of 61.94 per dollar. On the sectoral front, metal witnessed the maximum gain in trade followed by auto and realty, while banking and oil and gas remained the only losers on the BSE sectoral space. The broader indices were outperforming benchmarks, while the market breadth on the BSE was positive; there were 842 shares on the gaining side against 347 shares on the losing side while 43 shares remain unchanged.

The BSE Sensex opened at 20228.76; about 20 points lower compared to its previous closing of 20249.26, and has touched a high and a low of 20323.77 and 20211.79 respectively. The index is currently trading at 20253.69, up by 4.43 points or 0.02%. There were 19 stocks advancing against 11 declines on the index.

The overall market breadth has made a strong start with 68.23% stocks advancing against 28.20% declines. The broader indices were trading in green; the BSE Mid cap up by 0.67% and Small cap indices up by 0.43%. 

The top gaining sectoral indices on the BSE were, Metal up by 1.31%, Auto up by 0.87%, Realty up by 0.78%, Health Care up by 0.63% and Consumer Durables up by 0.47%, while Bankex down by 0.36% and Oil & Gas down by 0.19% were the only losers on the sectoral index.

The top gainers on the Sensex were Jindal Steel up by 2.63%, SSLT up by 2.39%, Tata Steel up by 1.95%, Cipla up by 1.54% and Maruti Suzuki up by 1.38%. On the flip side, HDFC Bank was down by 1.13%, ICICI Bank  was down by 0.84%, Sun Pharma  was down by 0.61%, Tata Power down by 0.52%  and RIL was down by 0.49% were the top losers on the Sensex.

Meanwhile, offering further solace to Indian currency, trade deficit narrowed to a two-and-a-half-year low at $6.76 billion in September, compared with $10.9 billion in August, after India’s exports posted double digit growth for third consecutive month, and with imports sliding for the fourth month in a row.

India’s exports during September, 2013 grew by 11.15% at $27.68 billion as compared to $24.90 billion during September 2012 thanks to stronger demand from Western nations and increased competitiveness thanks to the weaker rupee. While exports slid by 18.1% year-on-year to $34.44 billion against the level of $42.05 billion in September, 2012. The steep decline of imports for fourth consecutive month was witnessed on account of sharp slide of gold imports to $0.8 billion in September as compared to $4.6 billion in September 2012, as both government and the Reserve Bank of India’s clamped down on gold imports after the rupee had slipped to record low levels.

India, also the world’s biggest buyer of gold, has raised the import duty on gold three times this year, taking it to 10%, and in July the government told importers that a fifth of their purchases would have to be turned around for export, leaving only 80 percent for domestic use.

Further, trade deficit for April-September, 2013-14 stood at $80.12 billion was lower by 12.74% than the deficit of $91.82 billion during the corresponding period of the previous year, with exports growing by mere 5.14% at $152.10 billion and imports sliding by 1.80% at $232.23 billion during April-September 2013 as compared to corresponding period of the previous year.

The CNX Nifty opened at 6,001.05; about 6 points lower as compared to its previous closing of 6,007.45, and has touched a high and a low of 6,031.80 and 5,997.75 respectively.

The index is currently trading at 6,009.90, up by 2.45 points or 0.04%. There were 30 stocks advancing against 19 declines and one stock remains unchanged on the index.

The top gainers of the Nifty were Ranbaxy up by 4.61%, Jindal Steel up by 2.43%, SSLT up by 2.22%, Tata Steel up by 1.80% and DLF up by 1.80%. On the flip side, HDFC Bank down by 1.38%, ICICI Bank down by 1.00%, Sun Pharmaceuticals down by 0.67%, Tata Power down by 0.64% and Reliance Industries down by 0.55% were the major losers on the index.

Most of the Asian equity indices were trading in green; Jakarta Composite strengthened 28.41 points or 0.64% to 4,485.85, KLSE Composite rose 5.68 points or 0.32% to 1,774.80, Nikkei 225 surged 101.76 points or 0.72% to 14,139.60, Straits Times added 10.12 points or 0.32% to 3,164.96 and Seoul Composite was up by 0.40 points or 0.02% to 2,003.16.

On the flip side, Shanghai Composite declined 19.57 points or 0.88% to 2,192.20 and Hang Seng was down by 189.46 points or 0.82% to 22,844.51.

Taiwan Weighted remained closed for the trade today.