MARKETS SLIP IN RED

The Indian equity markets have slipped in the red after making a flat start as IT major Infosys Technologies has reported a lower-than-expected Q4 numbers. The cues from the global indices also hurt the investors' sentiments as the US markets closed flat on overnight, while all the Asian counterparts barring Jakarta Composite were trading in the negative terrain at this point of time, indicating somber investors' sentiments. Back home, on the sectoral front Auto witnessed the maximum gain in trade followed by banking and consumer durables while, software, technology and power stocks remained the top losers on the BSE sectoral space. However, the broader indices were outperforming benchmarks. Meanwhile, apart from Infosys other IT majors viz., Wipro, TCS and HCL Tech too witnessed a cut of more than two percent in the trade as Infosys has reported fourth quarter net profit of Rs 1,818 crore, a growth of 13.62% over Rs 1,600 crore in previous quarter, which is below the market expectations. The market breadth on the BSE was evenly divided; there were 964 shares on the gaining side against 892 shares on the losing side while 84 shares remained unchanged.

The BSE Sensex opened at 19,670.07; about 26 points lower compared to its previous closing of 19,696.86, and has touched a high and a low of 19,700.96 and 19,474.35, respectively.

The index is currently trading at 19,560.66, down by 136.20 points or 0.69%. There were 16 stocks advancing against 14 declines on the index.

The overall market breadth has equally divided with 49.69% stocks advancing against 45.98% declines. The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices surged 0.11% and 0.15%, respectively.

The top gaining sectoral indices on the BSE were, Auto up by 0.39%, Bankex up by 0.38%, CD up by 0.35%, FMCG up by 0.30% and HC was up by 0.03%. While IT down by 4.40%, TECk down by 3.19%, Power down by 0.69%, Oil and Gas down by 0.64% and PSU down by 0.36% were the top losers on the index.

The top gainers on the Sensex were Hero Honda up by 3.16%, Bharti Airtel up by 1.24%, Hindalco up by 1.22%, SBI up by 0.84% and ITC was up by 0.63%.

On the flip side, Infosys down by 6.53%, Wipro down by 3.68%, ONGC down by 1.89%, TCS down by 1.35% and NTPC down by 1.09% were the top losers on the index.

Meanwhile, even as the government gets ready to go forward with its plans for auctioning the coal blocks, the mining industry is not very enthusiastic with the plan. The new process will replace the ages old system of allocating coal blocks based on recommendations of an inter-ministerial committee that was supposed to prioritize overall economic development.

The Federation of Indian Mineral Industries (FIMI), industry body representing miners across the country, feels that the new system will put additional financial burden of companies and lead to wastage of valuable resources. Miners would rather like to continue the process whereby blocks would be allocated as per the ministry recommendations.

However, user industries seem to be pretty much happy with the move as it would create a level playing field for all the players and also eliminate corruption. Industry feels that the move will limit the monopoly of government companies over mining resources and also help discover the true prices of crucial natural resources of the country.

Earlier, the coal ministry had issued draft guidelines for putting in place a competitive bidding regime for allocating coal blocks in the country. Government contends that the new system will bring in greater transparency and objectivity in the overall process of allocation and hence improve the allocative efficiency of natural resources.

The draft guidelines have been framed after months of deliberations over the matter in an inter-ministerial committee headed by the coal ministry. The government plans to put a total of 58 coal blocks with over 18,600 million tonne of reserves for auction in the first round of competitive bidding to be initiated by the coal ministry in next six months. The proposed blocks are in several states including Chhattisgarh, Jharkhand, Maharashtra, West Bengal, Orissa, Madhya Pradesh and Andhra Pradesh.

The S&P CNX Nifty opened at 5,898.75; about 13 points lower compared to its previous closing of 5,911.50, and has touched a high and a low of 5,907.35 and 5,847.20 respectively.

The index is currently trading at 5,874.20, lower by 37.30 points or 0.63%. There were 18 stocks advancing against 32 declines on the index.

The top gainers of the Nifty were Hero Honda up by 4.20%, Bharti Airtel up by 1.36%, Hindalco up by 1.12%, PNB up by 1.05% and SBI up by 0.94%.

Infosys down by 6.41%, Siemens down by 5.12%, Wipro down by 3.50%, ONGC down by 2.02% and HCL Tech was down by 1.97%, were the major losers on the index.

Asian markets were trading mostly in the red; Shanghai Composite was down 16.20 points or 0.53% to 3,026.44, Hang Seng was down 84.68 points or 0.35% to 23,929.32, KLSE Composite was down 4.85 points or 0.32% to 1,520.95, Nikkei 225 was down 58.02 points or 0.60% to 9,595.90, Straits Times was down 7.34 points or 0.23% to 3,151.58, Seoul Composite was down 8.59 points or 0.40% to 2,132.47 and Taiwan Weighted was down by 21.60 points or 0.25% to 8,781.13.

On the flip side, Jakarta Composite was up by 1.94 points or 0.05% to 3,709.92.