A VOLATILE SESSION

Indian frontline equity indices snapped a volatile session on a positive note on the last trading session of the week but settled only with moderate gains. Despite trading with good gains for most part of the session the bourses failed to sustain the optimism as domestic sentiments swayed to the tune of developments from the Euro-zone where a meeting of leaders of the G20 group of major world economies is underway. The sanguinity remained under check amid uncertainties looming over the outcome of a confidence vote in the Greek government and ahead of a widely-watched US nonfarm payroll data. However, largely across the board, buying interests was evident as investors rejoiced after the Greek PM George Papandreou abandoned the controversial plan for a referendum against Europe's recent rescue package, easing concerns that Greece would default on its large debts. Marketmen also cheered European Central Bank's surprise decision to cut interests rates by 25 basis points amid forecasts that the economic growth will mildly slowdown in the latter part of 2011. Sentiments were also buoyant on the back of encouraging economic US reports indicating a fall in unemployment claims and rising factory orders. Markets across Asia exhibited enthusiastic trends with some Asian equity indices even rallying over three percentage points while the European counterparts traded on a choppy note. On the domestic front, the PSU oil marketing companies failed to extend uptrend for the third straight session despite hiking petrol prices by Rs 1.80 per litre to wipe off their losses on the decontrolled fuel. This is the 4th hike in the current financial year, because of recent deprecation in rupee, which increased the cost of imported crude oil. The upside for the local bourses also got capped after Montek Singh Ahluwalia affirmed that the petrol price hike in India would certainly give an upward tick to headline inflation.
Earlier on Dalal Street, the benchmark got off to a gap up beginning as investors largely remained influenced by the optimistic sentiments prevailing in Asian markets after the worries of a disorderly default of Greece faded away once Papandreou abandoned referendum on the European rescue plan. Thereafter, the key gauges continued to trade in a narrow range through the morning trades but the sanguinity showed signs of easing with the advent of afternoon session. The frontline gauges even went on to drift below the neutral line for a brief period due to volatility in Europe but some short covering in the dying hours of the session ensured that the bourses extend the gaining streak for yet another session. Eventually the NSE's 50-share broadly followed index Nifty, gained by around half a percent to settle below the crucial 5,300 support level while Bombay Stock Exchange's Sensitive Index Sense added eighty points and closed above the psychological 17,550 mark. Moreover, the broader markets finished on a positive note in tandem with their larger peers. On the BSE sectoral space, the Metal index remained the top gainer in the space and settled with over one and half a percent gains followed by the rate sensitive Capital Goods pocket which too went home with over a percent gains. But the Oil & Gas sector remained the only chink in the armor as it was the only laggard in the space which went home with moderate losses, dragged by heavyweight Reliance which sank by over half a percent. The markets rose on weaker volumes of over Rs 1.05 lakh crore while the turnover for NSE F&O segment too remained on the lower side as compared to Thursday at over 0.95 lakh core. The market breadth remained optimistic as there were 1,580 shares on the gaining side against 1,234 shares on the losing side while 162 shares remained unchanged.
Finally, the BSE Sensex gained 80.68 points or 0.46% to settle at 17,562.61, while the S&P CNX Nifty advanced by 18.45 points or 0.35% to close 5,284.20.
The BSE Sensex touched a high and a low of 17,702.26 and 17,474.39 respectively. The BSE Mid cap and Small cap index up by 0.75% and 0.38% respectively.
The major gainers on the Sensex were Hindalco Industries up 2.43%, Jindal Steel up 2.42%, Hero MotoCorp up 2.19%, Sterlite Industries up 1.69% and SBI up 1.54%. While, Tata Power down 1.95%, Hindustan Unilever down 0.85%, Reliance Industries down 0.57%, Maruti Suzuki down 0.51% and Mahindra & Mahindra down 0.39% were the major losers on the index.
The top gainers on the BSE sectoral space were Metal up 1.64%, Capital goods (CG) up 1.03%, Realty up 0.80%, TECk up 0.70% and Bankex up 0.62%. While Oil & Gas down 0.31% was the lone loser on the BSE sectoral space.
Meanwhile, the government owned oil marketing companies (OMCs) have increased petrol prices by Rs 1.80 per liter to wipe off their losses on the decontrolled fuel. This is the 4th hike in the current financial year, because of recent deprecation in rupee, which increased the cost of imported crude oil. Prices at Indian Oil outlets, country's largest oil marketer has already increased, whereas other two OMCs i.e. Bharat Petroleum and Hindustan Petroleum will increase prices from today midnight.
After the hike, petrol will cost around Rs 68.64 per liter in Delhi, Rs 73.81 in Mumbai, Rs 73.15 Kolkata and Rs 72.73 in Chennai. The hike has been implemented to pass on the impact of a depreciating rupee that has resulted in a higher cost. The last time petrol price was hiked was on September 15, when companies raised prices by a steep Rs 3.14 per liter.
'We were losing around Rs 1.50 liter. The increase of up to Rs 1.91 has been done after factoring the local levies. The increase takes care of the entire loss on petrol,' an Indian Oil official said.
In September, rupee has depreciated by 3.34%, which pushed OMCs to go for another hike in petrol price. From the time of deregulation of petrol prices 17 months ago, petrol prices have increased by 43% to Rs 68.64 per litre in Delhi. In the same period of time, the diesel prices, which is still under government control has increased by only 8.37% to Rs 41.29 per liter on national capital.
However, the petrol price were decontrolled in line with the Kirit Parikh panel report, the government is yet to take decision on its suggestion of decontrolling diesel prices. Presently, the OMCs are losing around Rs 8.58 on a liter of diesel, Rs 25.66 on per liter kerosene and Rs 260.50 on a domestic LPG cylinder.
 The S&P CNX Nifty touched high and low of 5,326.45 and 5,256.80, respectively.
The top gainers on the Nifty were Ambuja Cement up 2.77%, Hero MotoCorp up 2.54%, Hindalco Industries up 2.47%, Cairn up 2.18% and Sun Pharma up 2.03%. On the flip side, Ranbaxy down 2.08%, Tata Power down 2.04%, Reliance Infra down 1.84%, Dr Reddy down 1.27% and Sesa Goa down 1.14% were the top losers on the index.
The European markets were trading in green. France's CAC 40 rose 0.57%, Britain's FTSE 100 up by 0.78%, and Germany's DAX increased by 0.12%.

Asian markets witnessed jubilant run on last trading day of the week after Greece backed away from a proposed referendum that threatened its membership in the euro. Also boosting sentiment was Europe's quarter-point cut to 1.25%, announced by the central bank's new President Mario Draghi. The move took markets by surprise and indicated that the central bank will focus on supporting growth, even in the face of elevated inflation. Meanwhile, Seoul Composite surged the most, up by over two percent point supported by rallies in technology issues and refiners. Moreover, Chinese benchmark ended up by 0.81 percent on Friday and 2.2 percent for the week, supported by expectations that the government was prepared to fine-tune macroeconomic policies as economic growth slows and by ample liquidity in the financial system.