Benchmarks trade near day’s low in late morning

Benchmarks have erased early gains and were trading near day’s low in late morning trade weighed down by selected heavyweight stocks. Sentiments remained dampened as the rupee was trading marginally lower at 62.37/38 versus its close of 62.31/32 on Monday, tracking largely steady regional stock markets. Traders were looking ahead to the inflation data next week for a clearer direction. Investors also remained concerned on the SBI’s internal report, that the revised FY’2011-12 gross domestic product (GDP) growth is likely to fall to 6 percent on account of a slump in manufacturing led by weak demand and difficulty in accessing funds. The first revised estimate of GDP for FY’12 was 6.2 percent and the second revised estimate for FY'12 is scheduled to be released on January 31. Some pessimism also came in from on report that foreign institutional investors (FIIs) sold shares worth a net Rs 318.91 crore on Monday as per provisional data from the stock exchanges.

On the global front, most of the Asian equity benchmarks were trading mostly higher at this point of time as investors remained optimistic about the outlook for the U.S. economy after the U.S. Senate confirmed Janet Yellen as the next head of the Federal Reserve. Back home, traders were buying, Capital Goods, Healthcare and Auto while, selling was seen in Bankex, Realty and Power on the BSE. Shares of telecom companies like, Idea Cellular, Bharti Airtel and Reliance Communication edged lower with court ruling, allowing the Comptroller & Auditor General (CAG) to audit books of accounts of private telecom companies.

The market breadth on BSE remains positive with advances to declines in the ratio of 877:821. 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 20697.64 down by 89.66 points or 0.43% after trading in a range of 20890.48 and 20637.18. There were 6 stocks advancing against 24 declines on the index. The broader indices were trading mixed; the BSE Mid cap index was down by 0.18% and Small cap index gained 0.07%.

The top gaining sectoral indices on the BSE were, Capital Goods up by 0.33%, Healthcare up by 0.18% and Auto up by 0.10% while Bankex down by 1.07%, Realty down by 0.80%, Power down by 0.70%, Teck down by 0.55% and IT down by 0.54% were the top losers on the sectoral index. 

The top gainers on the Sensex were Maruti Suzuki up by 2.06%, Sun Pharma up by 1.05%, Dr Reddys Lab up by 0.88%, BHEL up by 0.52%, and L&T up by 0.34%. On the flip side, Axis Bank was down by 2.95%, Tata Power was down by 1.47%, Hindalco Inds  was down by 1.40%, Wipro was down by 1.26% and SBI was down by 1.08% were the top losers on the Sensex.

Meanwhile, Industry chamber FICCI has unveiled its Economic Agenda for long term growth to bring the economy back to a sustained high growth path. FICCI has underlined the need to strengthen key triggers of growth of enterprises and job creations, as adding 10-12 million jobs annually would require a growth of 8-9% over a long period.

FICCI President Sidharth Birla highlighted that three key tangible macroeconomic indicators such as fiscal deficit, current account deficit and inflation have a bearing on investor perception. Regarding the fiscal deficit, S Birla has stressed that planned capital expenditure should not be compromised for revenue spending. Noting that social spending is a short-term measure for job creation, FICCI President stressed that it is imperative to link social spending to asset creation and skill building to overcome the problem like job creation.

Referring to India’s CAD, the FICCI President underscored that CAD must be brought down and policy interventions are needed to curb imports of natural resources which are available domestically. Furthermore, comprehensive plans for manufacturing competitiveness are also required, he added. Amid declining FDI in the country, India's dependence on FIIs is considerable, therefore, deepening of domestic capital markets is the only lasting solution to improve resilience for unforeseen events. Agricultural production and productivity must be raised to check food prices in order to tackle high inflation, WPI inflation surged to a 14-month high of 7.52 percent in the month of November. Moreover, to improve the business sentiments in the country, FICCI has expressed the need for clarity in policy formulation, time-bound and transparent implementation of policies with minimal discretion and greater certainty in legislative interpretation.

The CNX Nifty is currently trading at 6,158.25 down by 33.20 points or 0.54% after trading in a range of 6,221.50 and 6,144.75. There were 8 stocks advancing against 42 stock declines on the index. 

The top gainers of the Nifty were Maruti Suzuki up by 1.99%, Sun Pharmaceuticals up by 1.06%, Dr reddy up by 0.88%, BHEL up by 0.43% and L&Tup by 0.28%. On the flip side, Axis Bank down by 2.97%, Bank Baroda down by 2.17%, Kotak Bank down by 1.62%, Tata Power down by 1.53% and Hindalco down by 1.44% were the major losers on the index.

Most of the Asian equity indices were trading in green; Shanghai Composite rose 3.03 points or 0.15% to 2,048.74, Hang Seng gained 78.14 points or 0.34% to 22,762.29, KLSE Composite increased 2.67 points or 0.15% to 1,831.85, Straits Times added 7.80 points or 0.25% to 3,131.62, Seoul Composite surged 11.44 points or 0.59% to 1,964.72 and Taiwan Weighted was up by 47.15 points or 0.55% to 8,547.16. On the flip side, Jakarta Composite declined 11.53 points or 0.27% to 4,191.27 and Nikkei 225 was down by 91.88 points or 0.59% to 15,815.55.