Benchmarks trim losses; Nifty trades below 6,200 level

Indian equities trimmed losses but continued to trade in red in the late afternoon session on account of selling in front line counters. Absence of positive upside trigger for local markets combined with prevailing caution ahead of US jobs data later in the day is mainly keeping investors on the sidelines. Traders were seen piling positions in Power, Capital Goods and PSU stocks while selling was witnessed in Oil & Gas, Consumer Durables and Auto sector stocks. Hectic activity has been witnessed in sugar stocks after reports emerged that sugar production dropped by 4.5% to 25.14 million tonnes in 2012-13. In scrip specific development, Wockhardt was trading in red after Britain’s drug regulator revoked the quality compliance certificate for the company’s factory in India, the third of its plants to be hit by export restrictions this year. Clariant Chemicals (India) was trading in green on reports that the speciality chemicals maker has shortlisted bidders for sale of its Thane land. Radico Khaitan was trading in green after the company’s board approved the decision to hive off its Indian made foreign liquor (IMFL) business undertaking to a subsidiary. NHPC was trading in green ahead of board meeting for buyback of equity shares this week.

On the global front, most of the Asian markets were trading in red while the European markets were trading on mixed note. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 6,200 and 20,900 levels respectively. The market breadth on BSE was positive in the ratio of 1382:945 while 150 scrips remained unchanged.  

The BSE Sensex is currently trading at 20856.86, down by 37.03 points or 0.18% after trading in a range of 20948.91 and 20812.84. There were 15 stocks advancing against 15 declines on the index.

The broader indices continued to outperform the benchmarks; the BSE Mid and Small cap indices were trading higher by 0.76% and 1.02% respectively.

The gaining sectoral indices on the BSE were Power up by 1.73%, Capital Goods up by 0.84%, PSU up by 0.82%, IT up by 0.77% and TECK up by 0.61%. On the other hand, Oil & Gas down by 0.52%, Consumer durables down 0.52%, Auto down by 0.44% and Health Care down by 0.14% were the losing indices on BSE.

The top gainers on the Sensex were Tata Power up by 2.38%, Coal India up by 1.74%, Wipro up by 1.70%, Tata Steel up by 1.40% and Gail India up by 1.05%. On the flip side, HDFC down by 2.40%, Hero MotoCorp down by 1.79%, Hindalco Industries down by 1.48%, RIL down by 1.46% and Cipla down by 1.05% were the major losers on the Sensex.

Meanwhile, blame it on lower crushing and recovery levels in key producing states that the country’s sugar output dropped by 4.5% to 25.14 million tonnes in 2012-13 marketing year that ended last month as against 26.34 million tonnes of sugar output in the previous marketing year. However, despite the drop, the production was sufficient to meet the local demand, which increased by 3.6% to 22.8 million tonnes in the same period.

Further, data from Indian Sugar Mills Association (ISMA) showed that 2.5% less sugarcane was crushed in the 2012-13 crop season, while the all-India average recovery rate stood at 10.03% compared with 10.25% in the previous year.

Maharashtra, the country's largest sugar producing states, produced 7.99 million tonnes of sugar after crushing 70.1 million tonnes of sugarcane. While, sugar production dipped by 11% than last year, sugar crushing for the season was 98% lower. This dip was mainly on account of lower sugar recovery in 2012-13 at about 11.41%.

However, Uttar Pradesh produced 7.4 million tonnes of sugar and crushed 81.5 million tonnes of sugarcane, which was 7.3% more sugar than last year and 6% more than the sugarcane crushing last year respectively. Better sugar recovery than last year's of 9.07%, helped in giving slightly more sugar production. Notably, Maharashtra and Uttar Pradesh, together account for about 80% of the country's sugar production. Further, sugar production during 2012-13 marketing year stood at 3.46 million tonnes in Karnataka, 1.96 million tonnes in Tamil Nadu and 0.99 million tonnes in Andhra Pradesh.

The CNX Nifty is currently trading at 6,196.05, down by 8.90 points or 0.14% after trading in a range of 6,220.10 and 6,181.80. There were 23 stocks advancing against 27 declines on the index.

The top gainers of the Nifty were Power Grid up by 2.91%, HCL Technologies up by 2.76%, Tata Power up by 2.25%, IDFC up by 1.87% and Coal India up by 1.72%. On the flip side, HDFC down by 2.46%, Hero MotoCorp down by 2.08%, Hindalco Industries down by 1.52%, Reliance Industries down by 1.39% and DLF down by 1.38% were the major losers on the index.

Most of the Asian equity indices were trading in red; Shanghai Composite declined 0.83%, Hang Seng lost 0.52%, Jakarta Composite tumbled  by 1.35%, KLSE Composite was down by 0.01%, and Taiwan Weighted was down by 0.01%.

On the other hand, Nikkei 225 was up by 0.13%, Straits Times was up by 0.44% and Seoul Composite gained 0.15%.

The European markets were trading mixed; France’s CAC 40 was down 0.19%, Germany’s DAX lost 0.11% and UK’s FTSE 100 gained 0.08%.