Benchmarks trim partial losses; Nifty nears 6100 level

Benchmark equity indices have trimmed partial losses, led by the recovery in Metal counter, with gains of Technology and Information Technology counters on account of weaker Rupee, too aiding the sentiment. Nevertheless, bottom fishing at lower level tailing a positive start of European markets are also adding to the positive forces for Indian equity markets, with Sensex and Nifty now nearing the crucial 20,600 and 6100 levels respectively. On the global front, a major European stock index have hit a 2-1/2-year high and Germany's DAX a record peak on Tuesday on growing optimism that U.S. lawmakers would soon agree a deal to re-open the government and avoid a possible default.

Closer home, however, the mood continues to remain downbeat on account of string of dismal macroeconomic indicators of the country, with the latest being the murky retail Inflation data which reversing two consecutive months’ easing trend has spiked up to 9.84% in September as against 9.52% in the previous month. The latest data which adds to the odds of Reserve Bank of India, raising repo rates in the upcoming quarterly policy review on October 29, in order to do away with sticky inflation, has dragged the rate sensitives, viz, banking, realty and Auto counter lower. Nevertheless, realty counters have reversed some of its losses on the back of few reports which suggest of the government likely soon deciding on relaxing foreign direct investment (FDI) guidelines for the sector. The overall market breadth on BSE is in the favour of declines which have thumped advances in the ratio of 1292:785; while 138 shares remained unchanged.

The BSE Sensex is currently trading at 20582.15, down by 25.39 points or 0.12% after trading in a range of 20,759.58 and 20,446.73. There were 11 stocks advancing against 19 declines on the index.

The broader indices too trimmed some of its losses; with BSE Midcap and Smallcap indices now trading lower by 0.66% and 0.71% respectively.

The gaining sectoral indices on the BSE were Teck up by 1.03%, IT up by 0.97% and Metal up by 0.80%. While, Bankex down by 1.15%, PSU down by 0.80%, FMCG down by 0.78%, Consumer Durables down by 0.68% and Power down by 0.50% were remained the losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 3.29%, Wipro up by 3.04%, Tata Steel up by 2.72%, Hindalco Industries up by 1.94% and NTPC up by 0.70%. On the flip side, GAIL India down by 1.65%, Tata Power down by 1.54%, ITC down by 1.46%, Hero MotoCorp down by 1.15% and ICICI Bank down by 1.13% were the top losers on the Sensex.

Meanwhile, as per the Confederation of Indian Industry (CII) survey, Indian economic growth is likely to remain below 5 percent in the current fiscal. CII survey, based on the assessment of CEOs, indicated that ongoing economic slowdown has weighed down the confidence of India Inc as 42 percent of the respondents expected the economy to grow in the range of 4.5 to 5 percent. Further, 65 percent of the respondents expect that economic growth recovery will not take place before the second quarter of next fiscal.

Indicating that Indian economy is moving towards a situation of stagflation, the survey added that majority of the respondents (42 percent of CEOs) expected inflation to increase moderately in the second half of the year. Referring to the domestic currency, 53 percent of the respondents expected the rupee to prevail below 62 per dollar by the end of the current fiscal with current account deficit easing. Moreover, political uncertainty was ranked as the highest risk factor in coming future, affecting the business confidence of India Inc.

Regarding the country’s infrastructure sector, 56 percent of the respondents did not feel that the recently set up Cabinet Committee on Investment (CCI) had raised investments so far at the ground level. Meanwhile, in order to revive investment demand, industry body expressed the need for strengthening policy intervention by both the government as well as RBI, adding that the government should focus on stepping up capital expenditure whereas RBI should adopt a softer monetary stance.  

The CNX Nifty is currently trading at 6,089.75, down by 22.95 points or 0.38% after trading in a range of 6,156.30 and 6,056.55. There were 15 stocks advancing against 35 declines on the index.

The top gainers of the Nifty were JP Associate up by 6.54%, Bharti Airtel up by 3.12%, Wipro up by 2.95%, Tata Steel up by 2.88% and Hindalco Industries up by 1.99%. On the flip side, Indusind Bank down by 2.97%, IDFC down by 2.64%, Ranbaxy down by 2.53%, Gail India down by 1.85% and Tata Power down by 1.79% were the major losers on the index.

The Asian equity indices were trading in mixed; Jakarta Composite up by 0.74%, Taiwan Weighted up by 1.14%, Seoul Composite up by 1.02%. Nikki 225 up by 0.26%, Hang Seng up by 0.50%. While, KLSE Composite down by 0.06%, Shanghai Composite down by 0.34%.

European markets got off to a fantastic start; with CAC 40 gaining by 0.25%, DAX rising by 0.55% and FTSE 100 adding 0.63%.