Benchmarks dip their head to intra-day low level; Nifty oscillates below 6,050 level

Benchmark equity indices losing further ground have dipped their heads to intra-day’s low level in absence of any buying activity on the penultimate session of F&O expiry. Besides, slide of Asian shares also are discouraging investors from taking any position in risk equities, especially ahead of India’s GDP data, scheduled to release on Friday. However, appreciation of Indian currency on speculated corporate dollar inflows, mainly on account of  Mylan Inc' s purchase of a unit of Strides Arcolab, for a deal valued at $1.6 billion, is restricting the further downside of local equities, However, the same factor are pressuring Information Technology stocks, which have featured in the list of top losers. Languishing near day’s lowest point, Sensex and Nifty, are trading below the crucial 20,400 and 6,050 levels respectively. Meanwhile, broader indices being unable to decide on particular trajectory were trading on mixed note.

On the global front, Asian stocks were trading mostly lower on Wednesday as funds switched to better performing markets and trading thinned out ahead of the Thanksgiving holiday in the U.S.

Closer home, with more sectoral indices succumbing to selling pressure, only stocks from Consumer Durables, Auto and Fast Moving Consumer Goods sectors were the exceptions to the negative trend. Meanwhile, sugar companies surged after Prime Minister Manmohan Singh set up a committee on Tuesday under the chairmanship of agriculture minister to look into how to give help to struggling sugar mills. With this, traders are now speculating that help for the industry could include higher import duties or interest rate-free loans amongst other things. On the flip side, stocks from realty, Power and Healthcare counters were acting endorsing the negative trend of markets. The overall market breadth on BSE was in the favour of declines which thumped advances in the ratio of 1115:674; while 48 shares remained unchanged.

The BSE Sensex is currently trading at 20371.99, down by 53.03 points or 0.26% after trading in a range of 20,482.67 and 20367.18. There were 7 stocks advancing against 23 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was up by 0.01%, while Small cap index down by 0.30%.

The gaining sectoral indices on the BSE were Consumer Durables up by 0.68%, Auto up by 0.67%, and FMCG up by 0.54%. While, Realty down by 0.94%, Power down by 0.83%, Healthcare down by 0.77%, Technology down by 0.67%, and Information Technology down by 0.54% were losing indices on BSE.

The top gainers on the Sensex were ONGC up by 1.62%, Tata Motors up by 1.41%, ITC up by 0.92%, Bajaj Auto up by 0.65%, and Hero MotoCorp up by 0.59%. On the flip side, Bharti Airtel down by 2.35%, BHEL down by 1.93%, Sun Pharma down by 1.79%, SSLT down by 1.47%, and SBI down by 1.22%.

Meanwhile, Oil Minister M Veerappa Moily has said that 10th round of New Exploration Licensing Policy (NELP) auction would be announced by January 15, 2014. Oil minister further added that the government would auction 86 hydrocarbon blocks out of which 54 blocks have received clearances from various agencies and the rest of blocks will get approval by the time of bidding in January next year. A number of oil and gas blocks in the past were stuck due to lack of clearances from various agencies include Defence and Environmental ministries.

10th round of NELP auction will be the second highest offering of blocks since the advent of NELP in 1997, a common platform for public and private sector companies to bid for the blocks. As per the government, 10th round of auction is likely to be held on new terms wherein a bidder shall be asked to quote the amount of oil or gas output it is willing to offer to the government from the first day of production. Presently, oil companies are allowed to share the profit with the government only after recovering the entire cost of exploration and production.

Meanwhile, oil ministry has formulated a roadmap for cutting India's dependence on imports to meet its oil needs. India currently imports around 80 percent of its oil needs and the Ministry wants this to be cut to 50 percent by 2020 and by 25 percent in 2025 through intensive exploration and exploitation of untapped reserves. Presently, only 0.93 million sq km area in India is held under exploration and production in 19 basins as compared to total estimated sedimentary area of 3.14 million square kilometres, comprising 26 sedimentary basins.

The CNX Nifty is currently trading at 6,037.25, down by 21.85 points or 0.36% after trading in a range of 6,074.00 and 6,035.25. There were 11 stocks advancing against 39 declining stocks on the index.

The top gainers of the Nifty were Tata Motors up by 1.59%, ONGC up by 1.57%, ITC up by 1.11%, BPCL up by 1.09%, and Bajaj Auto up by 0.77%. On the flip side, JP Associates down by 3.26%, NMDC down by 2.30%, Bharti Airtel down by 2.09%, IDFC down by 2.07%, and BHEL down by 2.00% were the major losers on the index.

The Asian equity indices were trading mixed; Shanghai Composite up by 0.71%, Taiwan Weighted up by 0.58%, Hang Seng up by 0.63%, and Seoul Composite up by 0.31%. On the flip side, Jakarta Composite down by 0.11%, Nikkei 225 down by 0.42%, Straits Times down by 0.21%, and KLSE Composite down by 0.14%.