Barometer gauges nose dive to intra-day low level; Auto stocks showcase resilience

Barometer gauges have further nose-dived in red terrain with weakness visible across the board barring Auto counter which is currently holding the fort upright in green with gains of over half a percent. After getting a lackluster start for the new month F&O series, Indian equity markets losing strength brick by brick are currently oscillating near the intra-day low level due to pessimistic global set-up, that has also sapped the risk appetite of local investor’s. However, market-men even awaiting the release of RBI’s second quarter monetary policy review, have undertook sideline approach. Thus so far in the trade, 30 share barometer index, Sensex, offloading over century of points, is currently trading near 18600 level. Similarly, widely followed index, Nifty, declining over 3/ 4 percentage is trading below the psychological 5650 level. Broader indices too are not trading exceptional and are down and out with a cut of over 0.25%.

Bout of weakness is being witnessed on account of brutal thrashing in Consumer Durable, Health Care and Fast Moving Consumer Goods sectors, which have emerged as top losers on BSE sectoral front. Additionally, even Technology shares are suffering the brunt of profit-booking on worries about worsening global demand. On the flip side, Auto counter is the only pivotal showcasing resilience thanks to strong showing of Mahindra & Mahindra, which has puffed up gains of over 1.5% on good Q2 earnings.

On the global front, after the down trend witnessed in Asian pacific markets, European market have got off to a sluggish start weighed down by a fresh batch of gloomy corporate outlooks since demand for everything from cars to building materials is crippled by the euro zone economic crisis.

Closer home, the BSE Sensex, after trading in the range of 18729.53-18617.50, is currently trading at 18620.38, down by 138.25 points or 0.74%. There were only 8 stocks advancing against 22 declines on the index. The overall market breadth on BSE is in the favour of declines which have outnumbered advances in the ratio of 1514:918, while 127 shares remained unchanged.

The broader indices too are reeling under pressure; the BSE Mid cap index and Smallcap indices were trading lower by 0.33% and 0.47% respectively.

Consumer Durables (CD) down by 1.91%, Health Care (HC) down by 1.20%, Fast Moving Consumer Goods (FMCG), Oil and Gas were down by 1.13%, Power down by 0.77%, were the top losing sectors on the BSE. While, Auto up by 0.52% was the lone gainer.

The gainers on the Sensex were M&M up by 1.86%, Hero MotoCorp up 0.75% Tata Motors up by 0.65%, HUL up by 0.35% and ICICI Bank up by 0.26%.

On the other hand top laggards included, ITC down by 2.16%, Cipla down by 2.02%, Dr Reddy’s Lab down by 1.95%, RIL down by 1.58% and HDFC down by 1.57%.

Meanwhile, in a bid to bring back the Indian economy on the growth track, Prime Minister Manmohan Singh has urged the public sector units’ (PSU) honchos to invest and grow, and set the pace for India's growth in the process, during the meeting on Tuesday. Singh’s meet with PSU heads was held in the backdrop of declining domestic growth.

The PSU chiefs listed their major concerns including the most prominent one - to speed up project clearances. Also, the PSUs face issues like lack of autonomy, inability to invest which are closely connected. The Prime Minister advised the PSUs, with profits of almost Rs 1 lakh crore and accounting for 6% of GDP, to withdraw their cash surplus out of the banks and invest them in new projects. This would escalate India’s position as an attractive investment destination.

The public sector companies’ project clearance suffers many more delays than their private sector counterparts. However, according to PM, government is resolving this issue through National Investment Board (NIB). Owing to the opposition from the environment ministry, the NIB is yet to commence its operations. Finance minister P Chidambaram, who was also part of the delegation led by PM, stressed on the need to cut subsidies and push ahead with reforms.

The S&P CNX Nifty, after trading in the range of 5697.20-5663.85, is currently trading at 5664.35, down by 40.95 points or 0.72%. There were 13 stocks advancing against 47 declines on the index.

The top gainers of the Nifty were M&M up by 1.76%, IDFC up by 1.05%, Ambuja Cement up by 0.92%, Hero MotoCorp up by 0.91% and HCL Technologies up by 0.62%.

On the flip side, JP Associates down by 3.88%, Kotak Bank down by 2.64%, ITC down by 2.17%, Cipla down by 1.95% and Dr Reddy down by 1.80% were the major losers on the index.

All the Asian equity indices were trading in the red; Shanghai Composite plunged by 1.64%, Hang Seng declined by 1.11%, Nikkei 225 slumped by 1.35%, Kospi Composite fell by 1.72% and Taiwan Weighted plummeted by 1.76%.

Indonesian Jakarta Composite, Malaysia’s KLSE Composite and Singapore’s Straits Times remain closed on account of public holiday.

European markets have got off to a red start; with CAC 40 trading lower by 0.58%, DAX lost 0.26% and FTSE 100 was down by 0.36%.