Post session - Quick review

Showing divergent trading pattern, Indian equity markets outperformed the global markets on Tuesday.  Benchmark equity indices after flip-flopping around the red territory for the entire trading session, finally finished in the green zone, thanks to lower level buying in select blue chip stocks, which acted as saving grace for Dalal Street.  Late hour buying in range-bound session mainly yanked the barometer frontline equity indices above their crucial psychological level of 16000 mark (Sensex) and 4800 (Nifty) respectively.

However, the undertone in global equity markets remained cautious after international rating firms sharply criticised last week's European Union summit, underscoring rising skepticism that an accord struck by European leaders had done enough to contain the debt crisis. Fitch Ratings predicted a 'significant' economic downturn in Europe and said that the sovereign-debt crisis was likely to continue throughout 2012, while Moody's Investors Service said the crisis remains in a 'critical and volatile stage.

Across Asia pacific markets, most of the Asian indices ended abysmally low tracking overnight losses on Wall Street and also as many investors took to the sidelines ahead of the US Federal Reserve rate-setting meeting later in the day.

Meanwhile, European shares rose on Tuesday as investors bought up beaten-down stocks following sharp fall on Monday after a plan outlined at last week's EU summit for stricter budget rules, failed to ease worries about the region's debt crisis.

Back on the home turf, IT bellwether Infosys accumulated gains of close to 1% after topping Mukesh Ambani-led Reliance Industries, as most influential stock on bourses. Measured in terms of its weightage on the key barometer index of Indian stock market, the Sensex, RIL had been enjoying its position as the most influential stock for many years and the movement in its share price has been crucial for any major fall or rise in this index.  However, Reliance Industries, too staged a gain of 2.10% or 15.25 points.

Splendid gains at 30 share barometer index -Sensex- on BSE were mainly contribution from Metal, Auto and Oil & Gas stocks, however, stocks from power and realty also toiled a lot to soothe the bewildered nerve. However, stocks from Consumer Durable and Capital Goods exhibited immense weakness throughout the trading session, with the two index pivotal ending above 1% and 0.25% respectively.

The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 1131:1589 while 128 scrips remained unchanged.

The BSE Sensex gained 191.63 points or 1.21% and settled at 16,061.98. The index touched a high and a low of 16,079.38 and 15,771.59 respectively. 27 stocks advanced against 3 declining ones on the index (Provisional)

The BSE Mid-cap index lost 0.38% while Small-cap index was down by 0.54%. (Provisional)

On the BSE Sectoral front, Metal up 2.74%, Auto up 1.41%, Oil & Gas up 1.40%, Power up 1.29% and Realty up 1.12% were the top gainer while Consumer Durables down 1.93% and Capital goods down 0.41% were the only losers.

The top gainers on the Sensex were Hindalco up 5.79%, Jindal Steel up 4.26%, NTPC up 3.28%, M&M up 3.19% and DLF up 2.81%.

On the flip side, L&T down 1.66%, Maruti down 0.34% and ONGC down 0.29% were the top losers on the index. (Provisional)

Meanwhile, the Union Finance Minister Pranab Mukherjee has said that maintaining the fiscal deficit at 4.6% of the Gross Domestic Product (GDP) is a serious challenge. The task to meet the fiscal deficit target in current financial year is difficult because of the unfavorable economic environment in domestic and global economy, expected decline in revenue collections because of slowdown in industrial production, economic activities and increasing subsidy bill.

Finance minister, on introducing the Appropriation Bill to seek Rajya Sabha's approval for raising the government expenditure by an additional Rs 56,848.46 crore, said to maintain the fiscal deficit, as per the target is a serious challenge.

In this year’s Budget, the government has estimated the fiscal deficit at Rs 4,12,817 crore or 4.6% of the GDP. However, by the first half of the current financial year, the fiscal deficit crossed Rs 2.8 lakh crore or 68% of the Budget Estimate (BE).

On the additional market borrowing in the second half of 2011-12, finance minister said, 'We had to go for (additional borrowing) to manage the cash flow but nonetheless it will have a stress and it will have its effect in the course of the year if the corrective steps are not taken.' In the monsoon session, the Parliament has approved Rs 9,016 crore net cash outgo as first batch of Supplementary Demand. 

Finance Minister said that ‘after the passage of almost eight months in the current fiscal year, there has been some pressing unavoidable demands’. He said that the fiscal deficit is substantially high. However, one need not necessarily be worried over it because the five years’ moving average varies from 54-55%.

India VIX, a gauge for market’s short term expectation of volatility lost 3.96% at 28.11 from its previous close of 29.27 on Monday. (Provisional)

The S&P CNX Nifty gained 55.30 points or 1.16% to settle at 4,819.90. The index touched high and low of 4,824.70 and 4,728.50 respectively. 40 stocks advanced against 10 declining ones on the index. (Provisional)

The top gainers on the Nifty were Hindalco up 6.19%, Grasim up 4.70%, SAIL up 4.01%, Jindal Steel up 3.70% and M&M up 3.20%.

On the other hand, Reliance Power down 3.36%, L&T down 1.77%, Reliance Infra down 1.40%, BPCL down 0.86% and Ambuja Cement down 0.82% were the top losers. (Provisional)

The European markets are trading in green, with France's CAC 40 up 0.31%, Germany's DAX up 0.55% and FTSE 100 up 0.32%.

All the Asian equity indices ended the day’s trade in the negative terrain on mounting worries that a deal by European Union leaders to contain the region’s debt crisis would not be enough to solve its fiscal woes. The concern, which weighed on the euro, was amplified by warnings from credit ratings agencies over the situation. Ratings agency Standard & Poor’s is expected to pass judgement on the agreement this week after putting 15 of 17 euro-member states -- including France and Germany -- on downgrade warning. The agency last week announced the AAA status of the EU itself was on credit watch, citing worsening economic conditions and discord among leaders.China’s main stock index closed down by about two percent as investors warily awaited the outcome of the Chinese central government’s secretive annual economic meeting. China’s annual policy-setting economic work conference started on Monday and ends on Wednesday. While, Seoul shares ended down 1.9 percent on Tuesday led by fall in refiners, with S-Oil shedding 4.9 percent.