CONSOLIDATION

The Indian equity markets have made a positive start tracking firm cues from global equity indices but, the local indices pared most of their initial gains and are trading flat as investors remained cautious ahead of the F&O series expiry on Thursday. The US markets closed higher on Tuesday, for the third consecutive session while, most of the Asian counterparts were trading in the positive terrain at this point of time. Back home, on the sectoral front software witnessed the maximum gain in trade followed by technology and consumer durables while, banking, metal and capital goods were the top losers on the BSE sectoral space. Meanwhile, PSU oil marketing companies BPCL, HPCL and IOC all edged lower in the trade as crude oil prices surged overnight extending their upmove as hopes grew for resolution to euro debt crisis, moreover, banking sector remained under pressure as the Reserve Bank of India Governor D Subbarao has strongly defended his monetary policy actions to tackle soaring inflation. The broader indices were outperforming benchmarks. The market breadth on the BSE was positive; there were 1,009 shares on the gaining side against 624 shares on the losing side while 76 shares remained unchanged.
The BSE Sensex opened at 16,663.26; about 61 points higher compared to its previous closing of 16,524.03 and has touched a low of 16,471.84 while high remained its opening.
The index is currently trading at 16,550.07, up by 26.04 points or 0.16%. There were 11 stocks advancing against 19 declines on the index.
The overall market breadth has made a strong start with 59.04% stocks advancing against 36.51% declines. The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices rose 0.41% and 0.17% respectively.
The top gaining sectoral indices on the BSE were, IT up by 2.70%, TECk up by 1.85%, CD up by 0.99%, PSU up by 0.38% and Oil and Gas was up by 0.12%. While, Bankex down by 0.48%, Metal down by 0.41%, GC down by 0.38%, Power down by 0.13% and Auto down by 0.10% were the top losers on the index.
The top gainers on the Sensex were Infosys up by 3.11%, Wipro up by 2.37%, TCS up by 2.09%, Tata Motors up by 2.02% and ONGC was up by 0.70%.
On the flip side, Sterlite Industries was down by 1.39%, HUL was down by 0.97%, ICICI Bank was down by 0.90%, Hindalco was down by 0.89% and M&M was down by 0.88% were the top losers on the Sensex.
Meanwhile, the ministry of finance is firm in its decision to impose any kind of limits on foreign direct investment (FDI) in the Rs 47,000 crore pharmaceuticals sector, as against the department of industrial policy and promotion (DIPP), which is pushing for a more restrictive policy. The DIPP is pushing for more restrictive policy, in order to restrict the domestic pharma firms takeover by international firms, as it doubts that the increased ownership of the sector will increase the prices of medicine in the domestic market.
As per finance ministry official, any such move would be retrograde and detrimental to the India's image as an investment destination. Presently, foreign investors are allowed to invest 100% in country without the Foreign Investment Promotion Board's (FIPB) prior permission. The planning commission also shares the similar view, which also considers that the restricting foreign investment may affect the investment in the sector.
The ministry of finance and planning commission are of the view that there are alternative mechanisms to ensure the competitiveness in the sector and the competition regulator can address those concerns. On September 27, an expert committee headed by Arun Maira, Planning Commission Member, will discuss the recommendation. The committee will also consider the view expressed by the all stakeholders, including the health and finance ministries and pharmaceutical companies.
The panel was set up following directions from the cabinet committee of economic affairs (CCEA), chaired by Prime Minister Manmohan Singh. The recommendation came after anxieties were expressed within some sections of the government and the civil society on the issue of increasing price of generic drugs after a spate of acquisitions of the domestic companies by foreign companies.

However, the DIPP suggestion has the backing of the Council for Scientific and Industrial Research (CSIR) and the health ministry. The DIPP, which does not mind 100% FDI in new projects, had earlier suggested that all investment applications in the pharmaceuticals sector be sent for approvals by the FIPB. 'Foreign investments should not act as mere substitution for the sector and should bring additionality resulting in net capital formation.'

The S&P CNX Nifty opened at 5,005.50; 34 points higher compared to its previous closing of 4,971.25, and has touched a high and a low of 5,006.05 and 4,956.80 respectively.
The index is currently trading at 4,977.75, up by 6.50 points or 0.13%. There were 16 stocks advancing against 34 declines on the index.
The top gainers of the Nifty were HCL Tech up by 3.80%, Infosys up by 3.31%, Wipro up by 2.50%, Tata Motors up by 2.09% and Cairn up by 2.05%.
On the flip side, Sterlite Industries down by 1.43%, BPCL down by 1.36%, Kotak Bank down by 1.24%, SAIL down by 1.19% and Reliance Infra down by 1.15%, were the major losers on the index.
Most of the Asian equity indices were trading in the green; Shanghai Composite was up 4.34 points or 0.18% to 2,419.39, Jakarta Composite was up 55.72 points or 1.60% to 3,529.66, KLSE Composite was up 3.78 points or 0.28% to 1,367.98, Nikkei 225 was up 14.37 points or 0.17% to 8,624.32, Seoul Composite was up 1.65 points or 0.10% to 1,737.36 and Taiwan Weighted was up by 21.17 points or 0.30% to 7,111.12.
On the flip side, Hang Seng was down 163.24 points or 0.90% to 17,967.31 and Straits Times was down by 16.88 points or 0.62% to 2,709.03.