Benchmarks oscillate in tight band; Sensex trades past 20,700 bastion

Selling pressure virtually has halted at Dalal Street in the afternoon deals, with benchmark equity indices now gyrating in tight band, in absence of positive trigger which could lead to further recovery. Stuck in a tight range, Sensex and Nifty are holding above the crucial 20,700 and 6,150 bastions respectively, albeit with loss of over half a percent. Although, the overall sentiment at Dalal Street continues to remain downbeat after U.S. Federal Reserve's move of winding down the era of easy money, claiming the U.S. economy was finally strong enough for the bank to start scaling down its massive bond-buying stimulus by $10 billion a month, starting from January, 2014. Investors, taking the negative by its strides, are now awaiting the opening of European markets for further cues. Meanwhile, Asian pacific shares continue to remain in green terrain after the Federal Reserve drew the sting from tapering its stimulus by recommitting to low interest rates, leaving Wall Street at record heights.

Closer home, amidst across the board-selling pressure, only stocks from Information Technology, Technology and Metal counters are showcasing resilience, by holding in green terrain. On the flip side, stocks from Bankex, Capital Goods and Oil and Gas pivotals are the major pockets of weakness. Additionally, Telecom stocks are witnessing profit-booking even as govt is set to allow telecom companies to share 2G spectrum with each other as long as their combined holding is not more than 50% of the total airwaves allotted in that region, a move that would ease the pressure on operators struggling with congested networks and possibly reducing the bidding amounts in the upcoming auctions. While, Bharti Airtel, Reliance Communication and MTNL are trading lower by 0.75%-2.5%. The overall market breadth on BSE is in the favour of declines which have thumped advances in the ratio of 1108:950; while 165 shares remained unchanged.

The BSE Sensex is currently trading at 20724.81, down by 135.05 points or 0.65% after trading in a range of 21017.45 and 20646.03. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices continued to trade into negative territory; the BSE Mid and Small cap indexes were trading lower by 0.10% and 0.07% respectively.

The gaining sectoral indices on the BSE were IT up by 2.01%, TecK up by 1.40%, and Metal up by 0.11%. While, Bankex was down by 2.32% Capital Goods was down by 1.82%, Oil and Gas was down by 1.46%, Realty was down by 1.20% and Power was down by 1.01% were the top losing index on BSE.

The top gainers on the Sensex were Wipro up by 2.48%, TCS up by 2.07%, Sun Pharma up by 2.02%, SSTL up by 1.86% and Jindal Steel up by 1.81%. On the flip side, ICICI Bank down by 2.91%, HDFC down by 2.58%, Bharti Airtel down by 2.56%, L&T down by 2.51% and ONGC down by 2.46%.

Meanwhile, besides committing more steps to boost economy, Finance Minister highlighted that the initiatives taken by the government in the past one year are expected to fetch result as this would do its bit to boost investment and revive the sagging growth. In an attempt to shore-up investors’ confidence after US Federal Reserve announced to trim down its aggressive bond-buying program by $10 billion a month, the Finance Minister reiterated  that the government was committed to take all necessary steps to revive growth, boost investment, create conducive business environment, improving efficiency and depth of the markets, wider participation of investors and strengthening of the regulatory and institutional framework to channelize greater investments and to achieve potential growth of the Indian economy.

Listing out the initiatives taken by the government in the past one year to boost growth, Finance Minister underscored that the economy is headed towards gradual recovery and growth stabilization, after slipping to a decade’s low level of 5% in 2012-13. He highlighted that the government in consultation with RBI and SEBI made concerted efforts and instituted several measures to attract off-shore portfolio investment and improve investors' appetite.

Further, on account of policies to promote inclusive growth, FM unveiled that the proportion of people living below the poverty line declined from 37.2% in 2004-05 to 21.9% in 2011-12 and also added that this decline, had been at a much faster rate than the previous decades. Additionally, he underscored that Cabinet Committee on Investment (CCI), in order to boost investment, de-bottlenecked 200 projects, while Project Monitoring Group (PMG) had resolved 93 projects with total estimated cost of Rs 3.53 lakh crore.

Lastly, he also brought to light the initiatives, like settling up of Infrastructure Debt Funds (IDF), authorising PSUs to issue tax-free bonds, enhancement of the FII limits, among others to boost investment and growth.

The CNX Nifty is currently trading at 6,173.05, down by 44.10 points or 0.71% after trading in a range of 6,263.75 and 6,150.70. There were 13 stocks advancing against 37 declining on the index.

The top gainers of the Nifty were HCL Tech up by 4.07%, Wipro up by 2.43%, Lupin up by 2.20%, Sun Pharma up by 2.05% and SSLT up by 1.96%. On the flip side, NMDC down by 3.61%, Kotak Bank down by 3.36%, Indusind Bank down by 3.04%, ICICI Bank down by 2.77% and PNB down by 2.66% were the major losers on the index.

Most of the Asian equity indices were mostly in green; Jakarta Composite was up 0.97%, KLSE Composite was up 0.08%, Nikkei 225 was up 1.74%, Seoul Composite was up 0.05% and Taiwan Weighted was up by 0.70%. the flip side, Shanghai Composite was down 0.74%, Hang Seng was down 0.25% and Straits Times was trading flat with negative bias.