Benchmarks witness marginal pull-back in early trade

After losing in previous two sessions, domestic benchmarks managed to pull back marginally in the early trade as investors started taking positions in beaten down fundamentally strong stocks. However, global cues remained subdued as the US markets extended their losses overnight on some disappointing corporate news while, Asian equities were trading cautiously on concerns that the European debt crisis would take a long time to solve. Sentiments also got bashed after Moody’s lowered the outlook for Germany, Netherlands and Luxembourg to negative due to the ‘rising uncertainty’ about the financial crisis. Back home, local bourses were trading flat-to-positive at this point of time with benchmarks inching towards their crucial 16,900 (Sensex) and 5,150 (Nifty) levels. On the sectoral front fast moving consumer goods witnessed the maximum gain in trade followed by metal and banking while, technology, capital goods and software remained the top losers on the BSE sectoral space. Meanwhile, Hindustan Unilever remained the top gainer among both the indices, up by over three and half a percent after reporting 112 percent year-on-year (yoy) jump in net profit at Rs 1,331 crore for the quarter ended June 2012, on back of land deals. However, Wipro remained the top loser on reporting weak Q1 numbers. The broader indices were going neck-to-neck with benchmarks. While, the market breadth on the BSE was positive; there were 882 shares on the gaining side against 653 shares on the losing side while 70 shares remained unchanged.

The BSE Sensex opened at 16,907.74; about 30 points higher compared to its previous closing of 16,877.35, and has touched a high and a low of 16,953.94 and 16,893.77 respectively.

The index is currently trading at 16,899.66, up by 22.31 points or 0.13%. There were 17 stocks advancing against 13 declines on the index.

The overall market breadth has made a positive start with 54.95% stocks advancing against 40.69% declines. The broader indices too were trading flat; the BSE Mid cap and Small cap indices rose 0.08% and 0.16% respectively.

The top gaining sectoral indices on the BSE were, FMCG up by 0.92%, Metal up by 0.19%, Bankex up by 0.17%, Oil and Gas up by 0.17% and CD up by 0.05%. While, TECk down by 0.26%, CG down by 0.24%, IT down by 0.20%, Realty down by 0.19% and PSU down by 0.01% were the top losers on the index.

The top gainers on the Sensex were HUL up by 3.66%, Sterlite Industries up by 2.01%, Maruti Suzuki Bank up by 1.48%, GAIL up by 1.00% and Infosys up by 0.73%.

On the flip side, Wipro was down by 4.11%, Hero MotoCorp was down by 0.89%, Sun Pharma was down by 0.89%, Tata power was down by 0.72% and BHEL was down by 0.71% were the top losers on the Sensex.

Meanwhile, the Prime Minister's Economic Advisory Council chairman, C Rangarajan has urged that quick action has to be taken in diesel prices decontrolling so as to hold the fiscal deficit of the country, which had increased to 5.76% in 2011-12 financial year. Albeit, the government had taken principle decisions to decontrol the price of diesel, it was not implemented fearing the adverse reactions. The decontrol will pass the power of fixing price of diesel from the government to state-owned oil companies.

He also suggested moving ahead with the foreign direct investment (FDI) in multi-brand retail and civil aviation by attaining approval through executive orders without approaching parliament. The government had failed to raise FDI cap in insurance and pension sector to 49%, from 26% and open the multi-brand retail segment to foreign players because of opposition from its coalition partners.

The government has targeted to bring down the fiscal deficit to 5.1% of GDP in the current fiscal, from 5.76% in 2011-12. The high commodity prices in the international market and the inability of the government to adjust domestic prices to global level is putting pressure on the nation’s exchequer.

The S&P CNX Nifty opened at 5,128.80; about 9 points higher compared to its previous closing of 5,117.95, and has touched a high and a low of 5,139.40 and 5,120.35 respectively.

The index is currently trading at 5,124.75, up by 6.80 points or 0.13%. There were 27 stocks advancing against 23 declines on the index.

The top gainers of the Nifty were HUL up by 3.66%, Sterlite Industries up by 1.91%, Maruti Suzuki up by 1.48%, Cairn up by 1.17% and Ambuja Cement up by 0.81%.

On the flip side, Wipro down by 4.08%, Tata Power down by 0.92%, Sun Pharma down by 0.84%, BPCL down by 0.76% and Hero MotoCorp down by 0.73%, were the major losers on the index.

Most of the Asian markets were trading mixed; Shanghai Composite was down by 1.50 points or 0.07% to 2,139.91, KLSE Composite lost 5.15 points or 0.31% to 1,631.00, Kospi Composite lost 5.57 points or 0.31% to 1,783.96 and Taiwan Weighted declined by 52.48 points or 0.75% to 6,979.15.

On the other hand, Nikkei 225 up 0.09 points to 8,508.41, Jakarta Composite added 8.95 points or 0.22% to 4,020.81, Straits Times was up by 16.73 points or 0.55% to 2,999.22.