WEAKNESS

The Indian equity marketss continued with its northward journey in the negative territory and currently trading near the low point of the day due to heavy selling in Reliance Industries and in few other blue chips. NSE benchmark has holding 5,000 level, while Sensex came off the 17,000 mark. On sectoral front Oil & Gas index is down by over 2% now. Capital goods, information technology and power stocks were among the other prominent losers. Pharmaceuticals, FMCG and metal stocks were trading in negative territory on selling pressure. Automobile stocks are trading firm. Select realty, consumer durables and bank stocks were also trading higher. Reliance Industries is down nearly 3.7% due to sustained selling at the counter as its second quarter results were below expectations. Reliance Industries, on the other hand, is likely to suspend oil and gas drilling due to pending internal valuation of its exploration and production strategy. Software trainer, NIIT rose more than 14% in early morning trades, after the firm said that it sold its US unit's entire stake in Element K Corp, a step-down subsidiary, to Ireland-based SkillSoft for $110 million. On the global front, most of the Asian markets continued to trade in green tracking US gains on earnings hopes and on expectations that Europe will come up with a plan to contain its debt crisis. Back home, the market breadth favoring the positive trend; there were 1,215 shares on the gaining side against 1,158 shares on the losing side while 100 shares remained unchanged.
The BSE Sensex is currently trading at 16,980.09, down by 102.60 points or 0.60%. The index has touched a high and low of 17,188.55 and 16,966.70 respectively. There were 10 stocks advancing against 20 declines on the index.
The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices up by 0.08% and 0.34% respectively.
The top gaining sectoral indices on the BSE were, Auto up by 0.88%, CD up by 0.54%, Realty up by 0.52% and Bankex up by 0.36%. While, Oil and Gas down by 2.21%, CG down by 1.18%, Power down by 0.93%, IT down by 0.70% and TECk down by 0.67% were the top losers on the index.
The top gainers on the Sensex were Maruti Suzuki up by 2.79%, Tata Motors up by 2.33%, SBI up by 1.73%, DLF up by 1.36% and Hindalco up by 1.17%.
On the flip side, RIL down by 3.71%, NTPC down by 2.51%, L&T down by 1.80%, Sun Pharma down by 1.79% and Jindal Steel down by 1.46% were the top losers on the Sensex.
Meanwhile, commenting on the latest headline inflation data, the Prime Minister's Economic Advisory Council (PMEAC) chairman, C Rangarajan said that there is no sign of moderation in the rate of price rise to prompt the Reserve Bank to change its policy of monetary tightening. Further, he said, 'it is not a very comfortable situation. For the monetary policy stance to change, inflation has to come down and show signs of definite decline. But that kind of an indication has not come.'

The headline inflation, measured by Wholesale Price Index (WPI) stood at 9.72% in September which marginally eased compared to 9.78% in August. From last ten months the headline inflation has been hovering above 9%, which is above the comfort zone of Reserve Bank of India (RBI).

This hovering inflation has made strong case for another hike by the RBI, which is scheduled to take review of monetary policy on October 25. To curb inflation, in last 18 months, the RBI has increased its short term lending and borrowing rates by 12 times.
Earlier this week, the RBI Governor, D Subbarao, said the rate hikes have affected industrial activities, but asserted that inflation continues to remain above the comfort level of around 5%. By adding further he said interest rates would come down only if inflation eased. Meanwhile, the PMEAC, in its Economic Outlook for 2011-12, had said that inflation is likely to remain elevated till the third quarter of the fiscal because of high prices globally.
The S&P CNX Nifty is currently trading at 5,105.40, down by 26.90 points or 0.52%. The index has touched a high and low of 5,160.20 and 5,095.75 respectively. There were 14 stocks advancing against 36 declines on the index.
The top gainers of the Nifty were Maruti Suzuki up by 2.92%, Cairn up by 2.74%, Tata Motors up by 2.28%, SBI up by 1.78% and DLF up by 1.68%. On the flip side, Reliance Industries down by 3.91%, IDFC down by 2.49%, NTPC down by 2.46%, Sun Pharma down by 2.45% and RCom down by 2.43% were the major losers on the index.
Most of the Asian equity indices were trading in the green, Hang Seng rose 1.22%, Jakarta Composite added 1.29%, KLSE Composite clocked in gains of 1.00%, Nikkei 225 expanded by 1.51%, Straits Times registered gains of 0.83%, Seoul Composite was up by 1.40% and Taiwan Weighted added 1.40%, while Shanghai Composite lost 0.18%.