Benchmarks pare their losses in late morning trade

Benchmarks pared their losses after hitting fresh intraday low in morning trade. Sentiments remained  a dampened  after the rupee edged lower against the dollar as the US Federal Reserve prepared to start cutting bond purchases amid data that signaled the recovery of the world's biggest economy is picking up speed. Some concern also came in after a study report by industry body Assocham, said that uncertainty over the outcome of the upcoming Lok Sabha elections is likely to cast a shadow on the economy. Traders also remained cautious ahead of India’s services PMI to be announced later in the day.

On the global front, most of the Asian equity indices were trading in the red at this point of time as weak services sector economic data from China dampened the sentiments. Meanwhile, Japanese Nikkei too declined around two percent as yen strengthened against the dollar. Back home, traders were buying, Consumer Durables, Capital Goods and Healthcare while, selling was seen in Bankex, Power and Realty on the BSE.

The market breadth on BSE remains positive with advances to declines in the ratio of 1066:625. BSE Sensex and NSE Nifty were comfortably trading near their psychological 20,800 and 6,150 levels respectively. The BSE Sensex is currently trading at 20808.49 down by 42.84 points or 0.21% after trading in a range of 20913.79 and 20740.63. There were 11 stocks advancing against 19 declines on the index. The broader indices were trading in green; the BSE Mid cap index was up by 0.30% and Small cap index gained 0.90%.

The top gaining sectoral indices on the BSE were, Consumer Durables up by 0.87%, Capital Goods up by 0.61%, Healthcare up by 0.42%, Metal up by 0.36% and Auto up by 0.27%, while Bankex down by 0.92%, Power down by 0.33%, Realty down by 0.27% and IT down by 0.24% were the top losers on the sectoral index. 

The top gainers on the Sensex were ONGC up by 2.50%, Tata Motors up by 1.34%, Gail India up by 0.93%, Wipro up by 0.83% and Sun Pharma up by 0.69%. On the flip side, Tata Power was down by 1.96%, ICICI Bank  was down by 1.52%, RIL was down by 1.10%, Bajaj Auto was down by 0.93% and Coal India was down by 0.88% were the top losers on the Sensex.

Meanwhile, Amid rising concerns over increasing acquisitions of domestic pharma firms by multinationals, Foreign Direct Investment (FDI) in the pharma sector grew by 86.5 percent to $ 1.08 billion during April-October period of current fiscal as compared to $ 580 million during the same period last year.

The Department of Industrial Policy and Promotion (DIPP) had proposed the norms to arrest the increasing foreign investment in domestic pharma firms as it is of the view that continuing acquisitions of Indian pharma firms by foreign companies would pose serious problems in availability of life-saving drugs to consumers in near future. Meanwhile, the DIPP proposal to reduce FDI cap to 49 percent in critical verticals from 100 percent was rejected by the Union Cabinet. DIPP also wants to restrict FDI in brown-field or existing pharma companies amid concerns that such acquisitions could shrink India’s capacity of producing low-cost generic drugs. During the period from April 2012 to April 2013, over 96 percent of the total FDI in the sector has come into brown-field pharma, reflecting meager growth in FDI in pharma green field projects. The Indian generic drug market grew at a CAGR of around 17 per cent between 2010-11 and 2012-13 mainly on the back of rising exports of generic drug due to their low cost.

Meanwhile, overall FDI into the country has declined by 15 percent to $12.6 billion during the seven month period of the current fiscal. Other sectors which received high FDI during the period include services ($1.36 billion), automobile ($784 million), construction ($699 million) and chemicals ($433 million).

The CNX Nifty is currently trading at 6,197.65 down by 13.50 points or 0.22% after trading in a range of 6,224.70 and 6,176.15. There were 18 stocks advancing against 32 stock declines on the index. 

The top gainers of the Nifty were ONGC up by 2.97%, Jindal Steel up by 1.64%, Tata Motors up by 1.41%, Lupin up by 1.29% and Gail up by 1.11%. On the flip side, Tata Power down by 1.78%, ICICI Bank down by 1.58%, NMDC down by 1.26%, IDFC down by 1.09% and PNB down by 1.09% were the major losers on the index.

Most of the Asian equity indices were trading in red; Shanghai Composite declined 40.13 points or 1.93% to 2,043.01, Hang Seng dropped 136.51 points or 0.60% to 22,680.77, Jakarta Composite shed 42.39 points or 1.00% to 4,215.27, Nikkei 225 tumbled 304.74 points or 1.87% to 15,986.57, Straits Times slipped 0.47 points or 0.02% to 3,131.00, KLSE Composite decreased 0.17 points or 0.01% to 1,834.57 and Taiwan Weighted was down by 28.44 points or 0.33% to 8,518.10. On the flip side, Seoul Composite was up by 8.24 points or 0.42% to 1,955.09.