Benchmarks pare losses in late morning

After flat opening, Indian equity benchmarks have pared their losses and continued to trade in green in late morning deals as buying emerged at higher levels in select heavyweights. Sentiments got some support on report that foreign institutional investors (FIIs) bought shares worth a net Rs 1011.95 crore on Tuesday, as per provisional data from the National Stock Exchange. Further, rupee appreciation against the US dollar too aided the sentiments. On the global front, the Asian markets were trading on mixed note awaiting the Federal Reserve’s policy statement.

Back home, traders were buying, Metal, FMCG and Health Care stocks, while selling was seen in IT, Teck and Oil & Gas. Infra stocks edged higher after the Planning Commission Deputy Chairman Montek Singh Ahluwalia has said that efforts to revive infrastructure investment would help in reverting to 8 percent growth in next three years. Meanwhile, the PSU oil marketing companies were trading higher on report that the loss on sales of diesel has been trimmed by more than Re 1 to Rs 7.16 per litre on the back of softening international oil rates.

The market breadth on BSE remains positive with advances to declines in the ratio of 1100:788. BSE Sensex and NSE Nifty were comfortably trading near their psychological 21,800 and 6,400 levels respectively. The BSE Sensex is currently trading at 21839.89. up by 7.28 points or 0.03% after trading in a range of 21893.42 and 21795.94. There were 22 stocks advancing against 8 declines on the index. The broader indices were trading in green; the BSE Mid cap index was up by 0.27% and Small cap index up by 0.37%.

The top gaining sectoral indices on the BSE were, Metal up by 1.92%, FMCG up by 0.88%, Healthcare up by 0.74%, Bankex up by 0.62% and Capital Goods up by 0.51%, while IT down by 2.79%, Teck down by 2.14%  and Oil & Gas down by 0.10% were the only losers on the sectoral index.

The top gainers on the Sensex were Hindalco up by 3.70%, Tata Steel up by 2.94%, Axis Bank up by 2.41%, SSLT up by 1.68% and Bharti Airtel up by 1.56%. On the flip side, TCS was down by 4.87%, Infosys was down by 2.99%, Wipro was down by 1.36%, ONGC was down by 1.25% and Hero MotoCorp was down by 0.53% were the top losers on the Sensex.

Meanwhile, The Reserve Bank of India (RBI) could relax the repo rate by at least 50 bps in the next 6-12 months to kick-start investments if growth conditions remain weak, while consumer price index based inflation moderates, as per the industry body Assocham. Indian industrial output for the period April-January 2013-14 stood flat over the corresponding period of the previous year. On the other hand, CPI inflation eased to a 25-month low of 8.10% in February, as against 8.79% in January.

Assocham  President Rana Kapoor has asserted that the RBI should adopt proactive liquidity management through a term repo calendar, along with expansion of the term repo window from the current Rs 89,000 crore in order to ease money market volatility and ensure credit flow to productive sectors. Further, the central bank could recalibrate savings bank deposit rates to a minimum of 6% and keep it deregulated for rates above 6% in order to incentivise financial savings.

Further, the Assocham President suggested that well-rated Indian banks with strong balance sheets should be allowed the flexibility to borrow through bonds and medium-term notes, in order to garner medium/long-term funds from good quality institutional investors. This borrowing should be over-and-above 100 per cent of Tier-I capital and considered only for banks with acceptable International Risk Ratings with minimum tenor of three years. Banks were allowed to borrow up to 100 per cent of Tier-I Capital and swap it with RBI at a concessional rate- a facility that expired on November 30, 2013.

The CNX Nifty is currently trading at 6,518.10 up by 1.45 points or 0.02% after trading in a range of 6,534.75 and 6,518.10. There were 35 stocks advancing against 15 declines on the index.

The top gainers of the Nifty were Hindalco up by 3.83%, Tata Steel up by 3.05%, Axis Bank up by 2.46%, Lupin up by 1.83% and Bharti Airtel up by 1.68%. On the flip side, TCS down by 4.28%, Infosys down by 2.85%, ONGC down by 2.35%, IndusInd Bank down by 0.97% and M&M down by 0.97% were the top losers on the index.

The Asian equity indices were trading mixed; Shanghai Composite slipped by 17.24 points or 0.85% to 2,007.96, KLSE Composite contracted 2.68 points or 0.15% to 1,818.02, Straits Times declined by 19.17 points or 0.62% to 3,074.67 and Taiwan Weighted was down by 33.39 points or 0.38% to 8,698.55. On the flip side, Jakarta Composite was up by 13.37 points or 0.28% to 4,818.98, Nikkei 225 was up by 186.33 points or 1.29% to 14,596.92, KOSPI Composite was up by 2.09 points or 0.11% to 1,942.30 and Hang Seng was up by 6.52 points or 0.03% to 21,590.02.