Post session - Quick review

 Benchmark equity indices after see-sawing for the entire session finally settled in green amidst positive global development, which provided some audacity to cautious investors in picking up selective lucrative bets. Indian equity markets after staging an appalling act in previous session showcased a fascinating performance after an agreement was reached by euro zone ministers to ramp up the firepower of their bailout fund. Euro zone officials agreed on Tuesday to strengthen a bailout fund and seek more aid from the International Monetary Fund to help lend troubled economies as Italy's borrowing costs hit fresh highs.  However, release of September quarter GDP numbers emerged as “low key affair” after coming much in line with expectation. India’s economy grew pathetically slow in two years at 6.9% in September quarter, thereby revealing the fact that stubborn inflation, rising interest rates and crisis-hit global capital markets had on Asia's third-biggest economy.

Indian equity markets outperforming the regional counterparts emerged victorious as Asian shares failed to gain any traction after Standard & Poor's pruned credit ratings on lenders from Bank of America Corp to Goldman Sachs Group Inc. Standard & Poor's downgraded its ratings on 15 global banks on Tuesday as part of a widely expected change in how the ratings company forms its opinions on financial institutions. The move shows how Standard & Poor's factors into bank ratings the level of governmental support, removing what it had seen as an assumption that governments would keep the big banks from failing. However, local equity markets showcased strong resilience even after the downtrend of European shares, which slid after opening in green dragged by the financial institutional shares.

Back on the home turf, shares of fertilizer companies such as Rashtriya Chemicals & Fertilizers, Chambal Fertilisers & Chemicals, Madras Fertilizers, GSFC and Southern Petrochemicals Industries Corporation slipped between 1-3% after the reports emerged that Power and fertiliser firms may have to pay up to Rs 3,400 crore extra on natural gas they buy from domestic producers as the government has priced the fuel in US dollars, which has appreciated sharply against the Indian rupee. Meanwhile, retail stocks like those of Shoppers Stop, Trent and Koutons gained, though crisis over FDI in retail entered 7th day and both Houses of Parliament were adjourned for the day amid the continuing standoff between the government and the opposition over the Cabinet decision allowing foreign equity in retail. Stocks of select retail companies allied in trades on Wednesday after PM Manmohan Singh rebuffed calls to reverse a decision to open up India' retail sector to global giants. Adding to the optimism were shares of Oil & Gas, FMCG and TECk counters, while that of CD, Realty and Auto counters languishing at the bottom featured in the worst performers list. Barometer gauges by the end, amassing modest gain of close to a percent, re-conquered the psychological 16,100 (Sensex) and 4,800 (Nifty) levels. The broader indices, however, failed to gain any traction and went home with loss of over 0.50%.The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 1256:1443 while 157 scrips remained unchanged.

The BSE Sensex gained 144.45 points or 0.90% and settled at 16,152.79. The index touched a high and a low of 16,179.56 and 15,849.57 respectively. 21 stocks advanced against 9 declining ones on the index (Provisional)

The BSE Mid-cap index lost 0.62% while Small-cap index was down 0.69%. (Provisional)

On the BSE Sectoral front, Oil & Gas up 2.09%, FMCG up 0.79%, Power up 0.75%, TECk up 0.69% and PSU up 0.68% were the top gainers while Consumer Durables down 2.21%, Realty down 0.51%, Auto down 0.33%, Bankex down 0.30% and Capital Goods down 0.04% were the only losers.

The top gainers on the Sensex were ONGC up 3.61%, NTPC up 3.00%, DLF up 2.84%, Jindal Steel up 2.74% and RIL up 2.48%.

On the flip side, Sterlite down 2.93%, Tata Motors down 2.37%, Hero MotoCorp down 2.09%, JP Associates down 1.66% and Tata Steel down 1.05% were the top losers on the index. (Provisional)

Meanwhile, substantiating fears of a slowdown, India’s economy grew by just 6.9% in the second quarter of 2011-12 financial year, the weakest expansion since the second quarter of 2009 against 8.8% in the year-ago period. The general expectation was that the economy will grow at the rate of 7% much lower than the 7.7% growth in the April-June quarter. The numbers were mainly dragged down by manufacturing sector which grew at 2.7% against 7.8% in the same quarter last year and mining which witnessed a de-growth of 2.9% compared to 8% growth Y-o-Y. Sectorally, Agriculture and Industry grew by 3.2%, Services by 9.3% and Construction growth stood at 4.3%.

As per the Central Statistics Office (CSO), Ministry of Statistics and Programme Implementation, the Quarterly Gross Domestic Product (GDP) at factor cost at constant (2004-05) prices for Q2 of 2011-12 is estimated at Rs 12,27,254  crore  as against  Rs 11,48,472 crore in Q2 of 2010-11, showing a growth rate of 6.9% over the corresponding quarter of previous year. GDP at factor cost at current prices in Q2 of 2011-12, is estimated at Rs 19,55,880 crore, as against Rs 16,85,793 crore in Q2, 2010-11, showing an increase of 16.0%.

The economic activities, which registered significant growth in Q2 of 2011-12 over Q2 of 2010-11 are, ‘electricity, gas and water supply’ at 9.8%, ‘trade, hotels, transport and communication’ at 9.9% and ‘financing, insurance, real estate and business services’ at 10.5%. The estimated growth rates in other economic activities in this quarter are 3.2% in ‘agriculture, forestry & fishing’, 2.7% in ‘manufacturing’ and 4.3% in ‘construction’ and 6.6% in ‘community, social and personal services’. The growth of ‘mining and quarrying’ sector declined to (-) 2.9% during this period.

Though, the decrease in the growth of GDP in second quarter can largely be attributed to the negative growth in ‘mining and quarrying’ and steep fall in the growth of manufacturing sector but the dampening business sentiment, sluggish industrial growth and expected decline in merchandise exports are further likely to impede the growth. Even the RBI had revised downwards the baseline projection of GDP growth for 2011-12 to 7.6% from 8% earlier. India VIX, a gauge for market’s short term expectation of volatility lost 1.19% at 26.55 from its previous close of 26.87 on Tuesday. (Provisional)

The S&P CNX Nifty gained 38.30 points or 0.80% to settle at 4,843.40. The index touched high and low of 4,851.55 and 4,754.80 respectively. 30 stocks advanced against 20 declining ones on the index. (Provisional)

The top gainers on the Nifty were Power Grid up 3.83%, ONGC up 3.63%, DLF up 3.26%, NTPC up 3.03% and Jindal Steel up 2.71%.On the other hand, SAIL down 3.94%, Sterlite down 3.03%, Ranbaxy down 2.96%, Axis Bank down 2.73% and Hero MotoCorp down 2.43% were the top losers. (Provisional)

The European markets are trading in red, with France's CAC 40 down 0.61%, Germany's DAX down 0.68% and FTSE 100 down 0.37%.