Sensex, Nifty drifts below red line; inflation rises to 7.55% in May

Indian equity markets edged up slightly before the release of inflation data amid alternate bouts of buying and selling, but drifted below red line with May WPI inflation coming in at 7.55% versus 7.23% month-on-month. However, manufactured products inflation for May came in at 5.02% versus 5.1%, food articles at 10.74% versus 10.5%, primary articles at 10.88% against 9.71% while fuel group at 11.53% as compared to 11.03%. These inflation numbers increased calls for rate cut from the central bank. The RBI is expected to cut repo rate by at least 25 basis points from the current 8 per cent on June 18. The BSE Sensex and NSE Nifty are currently hovering around previous closing values even after Asian markets extended losses. On the global markets, Asian shares slipped in red as weak US retail sales data raised fresh concerns about sluggish economic growth and on credit ratings agency Moody's slashing the rating of Spain to the edge of ‘junk’ status. Back home, the market breadth favoring negative trend; there were 1,050 shares on the gaining side against 1,126 shares on the losing side while 132 shares remained unchanged.

The BSE Sensex is currently trading at 16,907.71, up by 27.20 points or 0.16%. The index has touched a high 16,921.49 and low 16,820.64 of respectively. There were 20 stocks advancing against 10 declines on the index.

The broader indices were exhibiting mixed trend; the BSE Mid-cap index was down by 0.02% while Small-cap index was up by 0.14%.

The top gaining sectoral indices on the BSE were FMCG up 0.95%, IT up 0.61%, TECk up 0.46%, Metal up 0.46% and HC up 0.19%. While, CG down by 1.01%, Bankex down by 0.46%, PSU down by 0.32%, Realty down by 0.31% and Power down by 0.27% were the losers on the index.

The top gainers on the Sensex were ITC up 1.40%, Sterlite Industries up 1.18%, Maruti Suzuki up 1.15%, Infosys up 1.12% and Tata Power up 1.11%.

On the flip side, NTPC down 2.14%, L&T down 1.62%, ICICI Bank down 0.88%, Tata Motors down 0.84% and Bharti Airtel down 0.76% remained the top losers on the Sensex.

Meanwhile, the Confederation of Indian Industry (CII) has raised 12 core issues to the government in an attempt to rejuvenate business confidence and to get industrial growth back on track.

A delegation headed by Vinayak Chatterjee in its meeting with Dr C. Rangarajan, Chairman of Economic Advisory Council to the Prime Minister, and Pulok Chatterji, Principal Secretary to the Prime Minister, urged the government to take steps to release payments worth around Rs 1,00,000 crore to private companies for various projects that are stuck in the public system and requested approval for clearance of New Urea Investment Policy which will lead to take-off brownfield projects worth Rs 25,000 crore.

The delegation has also suggested two debt restructuring exercises for infrastructure companies, considering their stressed balance sheet. Vinayak Chatterjee emphasized on the need for a national infrastructure bond having gold either mortgaged or liquidated, to convert un-productive to productive assets in the company.

The S&P CNX Nifty is currently trading at 5,125.70, up by 4.25 points or 0.08%. The index has touched a high and low of 5,129.75 and 5,099.70 respectively. There were 26 stocks advancing against 24 declines on the index.

The top gainers of the Nifty were ACC up 1.92%, Sesa Goa up 1.65%, Siemens up 1.39%, ITC up 1.25%, and Tata Power up 1.22%. On the flip side, PNB down 1.97%, NTPC down 1.78%, L&T down 1.73%, HCL Tech down 1.66% and Bank of Baroda down 1.20% were the major losers on the index.

The Asian equity indices were trading mostly in red; Jakarta Composite down 0.89%, Nikkei 225 down 0.22%, Straits Times Index down 0.33%, Shanghai Composite down by 0.79%, Hang Seng Index was down 0.74% and Taiwan Weighted down 0.19%.

On the flip side, KOSPI Composite Index up 0.60% and KLSE Composite up 0.01% were only the gainer on the index.