MARKETS TRADE HIGHER

The Indian equity markets are trading in the positive terrain as buying continued by funds and retail investors amid a firm trend in the global market. However, the benchmarks turned red in the initial trade after a flat start as investors remained concerned over Euro zone‎ fears. The US markets continued their jubilant mood overnight on the back of better than expected jobs data, while most of the Asian counterparts were trading in the positive terrain at this point of time, indicating strong investors' sentiments. Back home, sustained selling witnessed in key heavyweights, pulled the market into the positive terrain after decline in early trade. The BSE's Sensex and NSE's Nifty were trading comfortably above their crucial 18,500 and 5,550 level. On the sectoral front fast moving consumer goods witnessed the maximum gain in trade followed by oil and gas and public sector undertaking while, banking, consumer durables and software remained the top losers on the BSE sectoral space. The broader indices were going neck to neck with benchmarks. However, Future Ventures, the new listing today was trading with a cut of about 18 percent at this point of time. The market breadth has made a positive start; there were 941 shares on the gaining side against 668 shares on the losing side while 97 shares remained unchanged.

The BSE Sensex opened at 18,564.95; about 36 points higher compared to its previous closing of 18,528.96, and has touched a high and a low of 18,590.60 and 18,485.42 respectively.

The index is currently trading at 18,577.10, up by 48.14 points or 0.26%. There were 19 stocks advancing against 11 declines on the index.

The overall market breadth has made a positive start with 55.16% stocks advancing against 39.16% declines. The broader indices were trading in line with benchmarks; the BSE Mid cap and Small cap indices up by 0.27% and 0.36% respectively. 

The top gaining sectoral indices on the BSE were, FMCG up by 1.73%, Oil and Gas up by 0.75%, PSU up by 0.61%, Metal up by 0.56% and Power was up by 0.55%. While Bankex down by 0.53%, CD down by 0.31%, IT down by 0.14% and TECk down by 0.05% were the only losers on the index.

The top gainers on the Sensex were HUL up by 4.71%, Hindalco up by 1.90%, ONGC up by 1.87%, Sterlite Industries up by 1.74% and ITC was up by 1.57%.

On the flip side, HDFC Bank down by 1.02%, Hero Honda down by 0.88%, ICICI Bank down by 0.76%, M&M down by 0.41% and Infosys down by 0.40% were the top losers on the index.

Meanwhile, as the inflation is showing no signs of coming down and with RBI and Indian government lowering their growth forecast from the earlier estimated levels, the government is now worried over its target of achieving fiscal deficit of 4.6% of GDP in this fiscal. Slower growth will result in lower direct tax collection as high commodity prices will hurt the margins of big manufacturing companies and reduction in revenues of the government will force it to borrow more making its fiscal deficit target difficult to achieve.

However, the government has put its hopes on monsoon as good monsoon leads to increase in spending in rural areas, which in turn will increase the indirect tax collections. Hence, the government is waiting to see the mood of monsoon for further direction, though despite normal monsoon forecast by India Meteorological Department (IMD), unusually mild summer around this time of the year is adding to the concerns.

Further, with the arrival of rains, the government will also have in hand the data on the first advance tax collections for the year which will enable it to predict the corporate performance for coming period though high interest rates will prevent the companies to make fresh investments further impacting the government's revenues. Meanwhile, stock markets have also been hit by this economic uncertainty making it difficult for the government to achieve the Rs 40,000 crore disinvestment target set for this year.

Yet people have not lost all hopes and are still optimistic as bumper crop of the previous year along with normal monsoon which may lead to another round of strong agriculture season may ease the inflation in the country. Also, many are of the view that high inflation is also not that bad and can have a positive impact on the economy as high prices result in increase in indirect tax collections.

The S&P CNX Nifty opened at 5,55.55; about 4 points higher compared to its previous closing of 5,551.10, and has touched a high and a low of 5,564.95 and 5,537.50 respectively.

The index is currently trading at 5,562.05, up by 10.95 points or 0.20%. There were 32 stocks advancing against 18 declines on the index.

The top gainers of the Nifty were HUL up by 4.60%, Hindalco up by 2.00%, ONGC up by 1.91%, ITC up by 1.63% and Sterlite Industries up by 1.62%.

Ranbaxy down by 1.17%, Ambuja Cement down by 1.15%, Hero Honda down by 0.99%, Hero HDFC Bank by 0.87% and ICICI Bank was down by 0.70%, were the major losers on the index.

Most of the Asian counterparts were trading in the green; Shanghai Composite was up 9.11 points or 0.32% to 2,881.57, Jakarta Composite was up 10.14 points or 0.27% to 3,795.59, KLSE Composite was up 1.86 points or 0.12% to 1,521.27 and Straits Times was up by 9.47 points or 0.30% to 3,146.41.

On the flip side, Nikkei 225 was down 2.65 points or 0.03% to 9,791.73 and Taiwan Weighted was down by 7.97 points or 0.09% to 9,027.51.

Stock markets in South Korea and Hong Kong remained shut today on account of a public holiday.