Barometer gauges reclaim the crucial psychological level

In the range-bound session of trade, stock markets in India after trading in proximity to its neutral line, have managed to persuade some trader’s to park their funds into risky bets. Aided by strong European leads, benchmark indices, recouping substantial losses, have reclaimed the 4,900 (Nifty) and 16,200 (Sensex) respective fortress. However, slender losses continued to prevail for 30 scrip sensitive index, Sensex near to its neutral line, while slender gains continue to rescue Nifty around the 4,900 bastion. However, salvaged by good earnings, broader indices continue to trade in fine contour since early deals. Voltas, Pidilite Industries, Max India, all featured in the hit list of the earning season.

Propped up by an unexpected boost from better-than-expected German and French consumer confidence data, European shares after starting flat were indicating sharp uptick at this point of time. However, Asian shares, after trading listless for the entire trading session, ended mixed. The brighter mood in European region was prompted by data showing German consumer confidence index was steady in May at 5.7, with the overall indicator forecasting an identical reading for June.

Closer home, stocks from high beta Realty and Capital Goods, were indicating buying interest, while stocks from defensive FMCG, Consumer Durable  and Oil & Gas, featured in the worst list of performers. The overall market breadth on BSE ended in the favour of advances, which thumped declines in the ratio of 1465:112, while 125 shares remained unchanged.

The BSE Sensex is currently trading at 16,245.51, up by 23.21 points or 0.14% after trading as high as 16,273.48 and as low as 16,118.35. There were 19 stocks advancing against 11 declines on the index.

The broader indices continued to trade on a positive note; the BSE Mid cap and Small cap indices surged 0.64% and 0.65% respectively.

On the BSE sectoral space, Metal up 1.22%, Capital Goods up 0.88%, Realty up 0.73%, Public Sector Undertaking up by 0.69% and Power up 0.47% were the major gainers, while Consumer Durables down 0.20%, Fast Moving Consumer Goods down by 0.12%, Health Care down by 0.07% were the only laggards in the space.

GAIL India up 4.16%, Tata Steel up 2.43%, Sterlite Industries up 2.15%, SBI up 1.79% and Hindalco Industries up 1.63% were the major gainers on the Sensex, while Maruti down 2.02%, Jindal Steel down 1.47%, M&M down 1.37%, HDFC down 1.06%, and RIL down 0.73% were the major losers in the index.

Meanwhile, the government should adopt the practice of dual pricing of diesel, says CII. The farm use of the fuel should continue to be subsidized whereas its non-farm use should have a minimum subsidy. Further, the huge subsidy on the price of cooking LPG in the urban areas should be phased out.

The chamber however, is in favour of continuing with kerosene subsidy as it is the poor man’s fuel. CII is also of the opinion that the hike in prices of petrol is steep and is unlikely to resolve the issue of the large subsidy bill. However there is an urgent need to address the issue.

The PHD chamber on the other hand has criticized the hike stating that it is likely to have an inflationary impact on the economy. It has further observed that even though crude oil prices have fallen considerably in the past few weeks, their effect has been nullified with the depreciation in the rupee.

The chamber is also of the opinion that the government should initiate policies that encourage investment and attract foreign capital inflows in the economy. Efforts should also be made to stabilize the falling rupee.

The S&P CNX Nifty is currently trading at 4,889.35, up by 8.35 points or 0.17% after trading as high as 4,935.80 and as low as 4,889.35. There were 34 stocks advancing against 16 declines on the index.

The top gainers on the Nifty were Gail India up by 4.67%, JP Associates up 3.02%, Tata Steel up 2.43%, SAIL India and Reliance Infra were up by 2.31% each.

Maruti Suzuki down by 2.16%, Bank of Baroda down 1.59%, M&M down 1.48%, Jindal Steel down 1.30% and Grasim down 1.26% were the major losers on the index.

In the Asian space, Shanghai Composite declined 0.74%, Jakarta Composite got pounded by 2.45%, Straits Times Index drifted lower by 0.21% and Taiwan Weighted dropped 0.75%.

On the other hand, Hang Seng rose 0.25%, KLSE Composite inched up 0.26%, Nikkei 225 added 0.20%, and KOSPI Composite advanced 0.53%.

The European markets after getting a flattish start turned positive as France’s CAC 40 added 0.54%, Germany’s DAX gained 0.98% and United Kingdom’s FTSE rose 0.29%.