MOMENTUM HALTED

Indian benchmark equity indices failed to capitalize on the early momentum and are trading off the day's high levels as sentiments got undermined by the disappointing third quarter GDP growth numbers. Economic activity in the country expanded at its weakest annual pace in almost three years in the three months to December, largely because high interest rates and rising input costs constrained investment and manufacturing. However, hefty gains in Oil and Gas heavyweights like ONGC and Reliance which also have significant weightage on the benchmark indices capped the downside chances for the equity gauges. ONGC shares got filliped after government approved decision of divesting 5 percent holding in the company through stock exchange mechanism. The government is eyeing to raise $2.5 billion by selling shares at a premium to ONGC's Tuesday closing price of Rs 283.40. On the BSE sectoral front, there absolutely no laggard however, profit booking in some banking stocks capped the gains in the index. Market participants remained optimistic as sentiments also remained influenced by sanguine cues. Apart from upbeat US consumer confidence data encouraging Japanese industrial production data which expanded at a better than expected pace of 2 percent in January from the previous month along with South Korea's factory output data which grew 3.3 percent exceeding estimates also underpinned sentiments. Also high hopes associated with European Central Bank's second 3-year long-term refinancing operation (LTRO) later in the day more than offset the lingering European debt worries. On the global front, Asian markets are largely trading on an optimistic note while European stock futures too are indicating a higher opening for the markets there as ECB prepared to make a second round of large-scale three-year loans to the continent's banks.

Moreover, the broader markets recovered from their intraday lows and are trading largely in tandem with their larger peers with around a percent gain. The bourses surged on good volumes while market breadth on BSE was dominantly in favor of advances in the ratio of 1638:990 while 104 scrips remained unchanged.

The BSE Sensex is currently trading at 17,912.76 up by 181.64 points or 1.02% after trading as high as 18,001.35 and as low as 17,815.91. There were 24 stocks advancing against 6 declines on the index.

The broader indices were trading on a positive note; the BSE Mid cap index surged 1.24% and Small cap climbed 0.99%.

On the BSE sectoral space, Oil & Gas up 2.52%, PSU up 2.07%, Realty up 1.81%, Power up 1.33% and Metal up 1.23% while there were no losers in the space.

ONGC up 4.14%, RIL up 2.84%, Bajaj Auto up 2.71%, Tata Steel up 2.41% and BHEL up 2.27% were the major gainers on the Sensex, while Jindal Steel down 0.61%, L&T down 0.50%, HDFC Bank down 0.43%, Maruti down 0.33% and GAIL down 0.04% were the major losers in the index.

Meanwhile, the pace of economic growth slowed substantially in the October-December quarter as GDP growth rate slipped to lowest levels in last ten quarters at 6.1 percent. Growth in GDP at factor cost during Q3, 2011-12, at 2004-05 prices, is estimated at 6.1 percent as compared to the growth rate of 8.3 percent in Q3, 2010-11.

The growth in GDP at factor cost during Q3, 2011-12, at 2004-05 prices, is estimated at 2.7 percent in 'agriculture, forestry and fishing' sector, 2.6 percent in industry and 8.9 percent in services sector. The 'agriculture, forestry and fishing' sector has shown a growth of 2.7 percent in its GDP during Q3, 2011-12, as against the 11 percent growth rate of corresponding period last year.

GDP growth in mining and quarrying declined to (-) 3.1 percent during Q3, 2011-12. The GDP in manufacturing sector is estimated at 0.4 percent during Q3, 2011-12. GDP in electricity sector is estimated at 9 per cent during Q3, 2011-12.

The S&P CNX Nifty is currently trading at 5,427.75, higher by 52.25 points or 0.97% after trading as high as 5,458.80 and as low as 5,400.25. There were 39 stocks advancing against 11 declines on the index.

The top gainers on the Nifty were ONGC up 4.20%, SAIL up 3.01%, IDFC up 3%, Bajaj Auto up 2.94% and Reliance up 2.83%.

Siemens down 1.23%, Dr Reddy's down 1.01%, Jindal Steel down 0.75%, L&T down 0.64% and Kotak Bank down 0.49% were the major losers on the index.

In the Asian space, Hang Seng gained 0.14%, Jakarta Composite surged 1.72%, KLSE Composite climbed 0.85%, Nikkei 225 inched up 0.01%, Straits Times advanced 0.62%, Seoul Composite soared 1.33% and Taiwan Weighted jumped 2.04%.

On the flipside only Shanghai Composite plunged 0.96% 

BOUNCE BACK

Barometer gauges have doubled their profit in comparison to their early deals as the bounce back of stocks belonging from Technology counters; have led to the additional gains at Dalal Street. Buying which is seen across the space on the BSE sectoral chart, barring Information technology counter, has led to the pullback rally in Indian equity markets, which past two consecutive sessions were staging correction.

However, positive global leads mainly have influenced the trading sentiment at Dalal Street. Asian pacific markets borrowing cues from positive close of bourses at Wall Street on Monday were trading mostly positive. Asian stocks posted modest gains after data showed a slightly improved housing market in the U.S. and oil prices showed signs of softening after a recent surge, which provided some relief to investor worries about fresh headwinds for the global economy. Benchmark oil slipped below $108 per barrel while the dollar fell against the euro and the yen. Meanwhile, the US future indices were showing an uptick in the screen trade.

Back on the home turf, fresh buying by funds and retailers at attractive lower levels, have mainly heaved the 30-share Sensex-higher by over 200 points, which in the past four sessions have lost nearly about 1000 of points. Meanwhile, Nifty, the wide-based index of National Stock Exchange (NSE) too has puff up over 75 points to trade above the 5350 level. The broader indices have added more than frontline indices and are shinning with gains of over 2% each. The overall market breadth on BSE is in the favour of advances which have thrashed declines in the ratio of 1657:654, while 92 shares have remained unchanged.

The BSE Sensex is currently trading at 17,687.09, up by 241.34 points or 1.38%. The index has touched a high and a low of 17,702.10 and 17,530.44 respectively.   There were 28 stocks advancing against just 2 declines on the index.

The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices surged 2.15% and 2.05% respectively.

The top gaining sectoral indices on the BSE were, Realty up by 3.37%, Consumer Durable (CD) up by 2.98%, Metal up by 2.78%, Bankex up by 2.55% and Power up by 2.47%.On the flip side, IT down by 0.52% remained the only losers on the index.

The top gainers on the Sensex were Sterlite Industries up by 4.71%, Hindalco Industries up by 4.47%, BHEL up by 4.22%, Tata Motors up by 4.04% and DLF up by 3.18%.

On the flip side, TCS down by 1.38% and infosys down by 0.26% were the only losers on the Sensex.

Meanwhile, the expert committee on sugar decontrol constituted by the Prime Minister Manmohan Singh in January 2012 is hopeful of submitting its report in the next six months. The committee under the chairmanship of Prime Minister's economic advisory panel, C Rangarajan, met for the first time on February 27, and is hopeful of submitting its report in the next six months. He further outlined various issues to proceed further relating to the sugar industry.

The members of the committee include Kaushik Basu, Chief Economic Advisor, Ministry of Finance, secretaries to the Department of Food and Agriculture, Agricultural Costs and Prices (CACP) Chairman, Ashok Gulati, former Agriculture Secretary, Nand Kumar, and the EAC Secretary, K P Krishnan.

India is the second largest producer and the largest consumer of sugar in the world.  Currently the industry is highly controlled by the government, right from the level of production to distribution. As per regulation, sugar mills are required to sell 10% of their output to the government at below-cost rates for supply to ration shops. Mills supply levy sugar at 60% of the cost of production which results in an annual loss of about Rs 2,500-3,000 crore. In addition, the Food Ministry also allocates the quantity of sugar that can be sold in the open market every month.

Apex sugar industry bodies Indian Sugar Mills Association (ISMA) and National Federation of Cooperative Sugar Factories (NFCSF) are seeking partial decontrol of the sector, including freedom to sell sugar in the open market and doing away with the levy obligation for the Public Distribution System.

Members of the expert committee are also of the view that the sector be de-regularized to unleash its true potential. Examples of countries like Brazil, where the sugar industry has flourished after being decontrolled, further strengthen this view. Sugar production in India is estimated to touch 26 million tonnes this fiscal as against the annual demand of 22 million tones.

The S&P CNX Nifty is currently trading at 5,356.75, higher by 75.55 points or 1.43%. The index has touched a high and a low of 5,357.20 and 5,306.45 respectively.  There were 46 stocks advancing against 4 declining one's on the index.

The top gainers of the Nifty were Reliance Infra up by 6.06%, Sterlite Industries up by 4.75%, Hindalco Industries up by 4.57%, RCom up by 4.33% and IDFC up by 4.27%.

On the flip side, Cairn down by 1.72%, TCS down by 1.65%, HCL Tech down by 1.16% and Infosys down by 0.46% were the major losers on the index.

Most of the Asian markets were trading in the green; Hang Seng was up 84.79 points or 0.40%, Jakarta Composite rose 0.11%, Straits Times added 0.29% and Seoul Composite expanded 0.53%

On the flip side, Shanghai Composite declined by 0.39%, KLSE Composite descended 0.30% were the lone losers on the index.

Stock markets in Taiwan remained closed on Tuesday on account of Peace Memorial Day holiday. 

BLEEDING CONTINUES

The three straight session southbound journey of Indian stock markets showed little signs of coming to a halt on Monday as with absolutely no domestic triggers to take the markets higher, the gloomy global tidings have taken the center stage, prompting investors to take profits off the table. It is turning out to be a freefall of sorts as the benchmark equity indices are struggling to find a bottom in noon trades and have already slipped closer to the psychological 5,300 (Nifty) and 17,600 (Sensex) levels after getting bludgeoned by close to two percent. Investors fretted over spillover risks from the European region while heightened geopolitical tensions between the nuclear ambitious Iran and the West too dented investors' morale. Market participants are growing increasingly nervous amid worries the longest rally in international crude oil prices in two years would not only multiply India's fiscal woes but also adversely impact global economic growth. Though leads from the Asian markets too remain somber, however the local markets are underperforming all the indices with largest cuts in the region. The European futures too are indicating that markets there would commence trade on a bleak note. Fertilizer stocks like Rashtriya Chemical Fertilizers, Chambal Fertilizers and Deepak Fertilizers etc trended higher on the back of reports that a ministerial panel has given in-principle nod to the new fertilizer investment policy.

Moreover, the butchery was far more brutal in broader markets where the indices got pounded by around two and half a percent, underperforming their larger peers by a quite a margin. The bourses dived on weak volumes on the second day of a new F&O series while market breadth on BSE was dominantly in favor of declines in the ratio of 1905:629 while 101 scrips remained unchanged.

The BSE Sensex is currently trading at 17,614.73 down by 308.24 points or 1.72% after trading as high as 17,975.19 and as low as 17,606.65. There were 5 stocks advancing against 25 declines on the index.

The broader indices were trading on a bleak note; the BSE Mid cap index plummeted 2.46% and Small cap sank 2.38%.

On the BSE sectoral space, FMCG up 0.46% while Realty down 4.65%, Metal  down 4.01%, Capital Goods down 3.91%, Power down 3.89% and Bankex 2.82% were the major losers in the space.

Cipla up 1.42%, Bharti Airtel up 0.83%, HUL up 0.62%, ITC up 0.60% and Sun Pharma up 0.40% were the only gainers on the Sensex, while Jindal Steel down 6.26%, BHEL down 5.35%, Tata Steel down 4.98%, DLF down 4.54% and Hindalco down 4.33% were the major losers in the index.

Meanwhile, profits of corporate India are expected to rise by 9.4% in the March quarter of 2012, as per data released by the Centre for Monitoring Indian Economy (CMIE). The banking sector is likely to be the main driver of this profit growth seeing a rise of 42.1% in net profit.

Indian corporates had incurred huge forex losses in the September and the December 2011 quarters because of a steep depreciation of the Indian rupee. However, the rupee is expected to appreciate in the March 2012 quarter, along with a moderation in input price inflation, which will pull up profits in the forthcoming quarter.

Profits for the entire financial year, however, are expected to be 9.5% lower than the year ago level. The net profit margin is also likely to drop to a decade low of 6%. The growth in sales though is expected to average at 22.2% for FY'12, which will come on top of an equally strong growth of 20.2% in FY'11. The growth in sales will be mainly driven by high unit realization.

The benefits of the increased prices are expected to accrue in the second half of the year as well, mainly on the back of increase in prices made by the companies in the first half of FY'12, due to rising costs of imported commodities such as crude oil, LNG, natural rubber and gold.

With interest rates remaining firm, the banking sector is also expected to witness a robust growth, and likely to continue in the second half as well. The RBI to combat inflation hiked interest rates 13 times since March 2010.

The S&P CNX Nifty is currently trading at 5,334.80, lower by 94.50 points or 1.74% after trading as high as 5,449.80 and as low as 5,330.05. There were 10 stocks advancing against 40 declines on the index.

The top gainers on the Nifty were Cipla up 1.45%, BPCL up 1.31%, ITC up 1.07%, HUL up 0.41% and Sun Pharma up 0.38%.

Seas Goa down 9.79%, Jindal Steel down 5.38%, IDFC down 5.11%, BHEL down 5.10% and DLF down 4.76% were the major losers on the index.

In the Asian space, Hang Seng slipped 0.31%, Jakarta Composite plunged 1.18%, Nikkei 225 eased 0.14%, Straits Times dropped 0.33%, Seoul Composite plummeted 1.42%.

On the flipside only Shanghai Composite advanced 0.55% and KLSE Composite inched up 0.03%.

Stock markets in Taiwan remained closed in observance of Peace Memorial Day holiday.

DOWNTREND

Protracting previous week's downturn to the fresh one, barometer gauges after slipping into red in early trade, have now dipped their heads to the day's low point. Benchmark indices have widened their loss on the back of the stocks belonging from the Realty, Capital Goods and metal counters. Market men resorted to hefty profit booking in early deals on the back of high oil prices which could spark off inflation issues. Rising crude oil prices lead to Nifty breaking the 5400 level on the downside; while the volatile 30 share index of Bombay Stock Exchange (BSE)-Sensex-too was seen trading below its psychological 18000 level.

Brent crude snapping five days of gains stayed near 10-month highs above $125 due to concerns over supply disruption as tension rose over Iran's disputed nuclear programme. However, stocks from defensive Fast moving Consumer Goods counter, which usually outperform in sluggish trade, have puffed up gains of close to a percent. Indian equity markets also failed to show any fervor in fresh trading week tracing gloomy leads of Asian pacific markets, which edged lower despite positive close of Wall Street on Friday night. Meanwhile, the S&P 500 continuing a pattern of steady gains on signs of U.S. economic recovery rose on Friday to close at the highest level since before the collapse of Lehman Brothers in 2008. However, even the US future indices continued to show a downtick in the screen trade.

Back home, broader indices slipped fast and deep in red in comparison to the frontline indices, Midcap index suffered a cut of over a percent and a half, while loss of Smallcap Index was limited to a percent and a half. The overall market breadth on BSE strongly favoured declines which outpaced advances in the ratio of 1451:734, while 70 shares remained unchanged.

The BSE Sensex is currently trading at 17,753.28, down by 170.29 points or 0.95%. The index has touched a high and a low of 17,975.19 and 17,746.60 respectively.  There were 7 stocks advancing against 22 declining one on the index, while 1 stock remained unchanged.

The broader indices too edged lower in line with frontline indices; the BSE Mid cap index was down by 1.67% while, Small cap index was down by 1.51%.

Realty down by 3.48%, CG down by 3.33%, Metal down by 2.85%, Power down by 2.19% and Auto down by 1.81% were the top losers on the index. On the flip side, defensive FMCG space up by 0.97% was the lone gainer on the index.

The top gainers on the Sensex were ITC up by 1.05%, HUL up by 0.95%, Cipla up by 0.78%, Sun Pharma up by 0.69% and HDFC Bank up by 0.63%.

On the flip side, L&T down by 3.73%, BHEL down by 3.40%, DLF down by 3.39%, Tata Steel down by 3.03% and Hindalco Industries down by 2.91% were the top losers on the index.

Meanwhile, the ground work on the ambitious National Manufacturing Policy (NMP) is likely to start as early as August this year, as per Union Minister of Commerce and Industry, Anand Sharma. As per the minister, much progress has been made in the area of land acquisition for setting up the National Investment and Manufacturing Zones (NIMZ) and the ministry will soon move towards setting them up.

The NMP was launched earlier this year with much fanfare. Even though the Cabinet had approved the NMP in October 2011, substantial groundwork was yet to start. The main objective of the policy was to raise the share of manufacturing sector in the gross domestic product to 25% from the present 15-16%, by the end of the decade. The NMP offers a number of fiscal incentives besides having a special focus on the small and medium industry sectors. The government through the policy aims to create 100 million new jobs by 2025 and develop new mega industrial zones.

The policy so far had been stuck due to failure of the labour, environment and finance ministries to issue notifications on the new policy. The most important and controversial aspect of the NMP was the creation of large-scale manufacturing zones. The first phase of the National Investment and Manufacturing Zone had been planned along the Delhi-Mumbai Industrial Corridor; however the Labour and Environment Ministries locked horns with the Department of Industry over the issue of certain relaxations of labour and environmental laws in the new manufacturing zones. Sharma is now hopeful that all departments will notify the policy by the end of March.

The S&P CNX Nifty is currently trading lower by 57.70 at 5,371.60. The index has touched a high and a low of 5,449.80 and 5,368.10 respectively. There were 11 stocks advancing against 39 declines on the index.

The top gainers of the Nifty were BPCL up by 3.05%, ITC up by 1.22%, Cairn up by 0.96%, HUL up by 0.74% and Sun Pharmaceuticals up by 0.72%.

Sesa Goa down by 9.66%, L&T down by 3.83%, DLF down by 3.70%, IDFC down by 3.62% and BHEL down by 3.49%, were the major losers on the index.

Asian equity indices were trading mixed; Shanghai Composite up by 0.73%, Hang Seng addec 0.26%, KLSE Composite gained 0.18% and Nikkei 225 rose by 0.12%.

On the flip side, Jakarta Composite declined by 0.99%, Straits Times shed 0.24% and Seoul Composite plunged 1.42%. 

However, stock markets in Taiwan remained closed on Monday on account of Peace Memorial Day holiday. 

MARKETS CONTINUE TO RECEDE

The last two sessions of the February series futures and options contract expiry week turned out to be days of correction for the Indian stock markets which have seen the bulls losing their stronghold over the crucial 5,500 (Nifty) and 18,100 (Sensex) levels. The F&O expiry day turned out to be yet another disappointing session for the benchmark indices which went through extremely volatile trades to eventually snap the session with around half a percent cuts on extremely large volumes. The drift in markets in last two sessions has forced market participants to give a rethink to their strategy on domestic markets especially at a time when international crude oil prices have spiraled to unsustainable levels and are showing little signs of correcting any time soon. Nevertheless, the frontline indices managed to extend the gaining momentum after the January series over 10% rally and amassed another around six percent gains in February series. On the expiry day, the psychological 5,450 (Nifty) and 18,000 (Sensex) levels proved as strong supports as the key indices staged a sharp recovery from those levels in the afternoon session and touched session's highs in late hours. Investors took largely across the board position squaring after the recent strong rally in domestic stock markets, lacking any significant upside triggers. Sentiments across the globe remained gloomy as worries over financial meltdown in Euro-zone persisted while global economic growth woes too prevented markets from moving higher. Meanwhile the recent sharp spurt in international crude oil prices has set alarm bells ringing, stoking nervousness not only among market participants but also the policy makers. The rally in oil prices would certainly have spiraling effect on the Indian economy as the nation imports more than 70% of the commodity for domestic requirements, thus re-fuelling the inflationary concerns. However, the positive opening for European markets did prop up sentiments in local markets for a brief period in late trade but the optimism fizzled out completely by the end.

The NSE's 50-share broadly followed index Nifty, declined around half a percent and settled below the psychological 5,500 support level while Bombay Stock Exchange's Sensitive Index - Sensex shed around sixty points to close above the psychological 18,050 mark. The broader markets too managed to trim some part off their losses but still settled with notable losses, underperforming their larger peers for the third straight session. On the BSE sectoral front, the high beta Realty counter led the losers in the space with 2.5% losses. The Metal, Auto and Capital Goods counters too went home with losses. On the flipside defensive - FMCG pocket along with the Power and Oil & Gas counters settled on a positive note. The markets snapped a volatile session on extremely large volumes of over Rs 3.29 lakh core while the turnover for NSE F&O segment also remained on the higher side as compared to that on Wednesday at over Rs 2.58 lakh crore. The market breadth remained pessimistic as there were 1092 shares on the gaining side against 1786 shares on the losing side while 108 shares remained unchanged.

On the F&O front, February series Nifty and Sensex staged a strong feat by jumping around 6% each. Besides, the broader markets managed to outperform their larger peers by a fat margin as by the end of February series the mid cap and small cap rallied around 8.6% and 7.6% respectively. The rate sensitive counters like Realty, Bankex and Auto remained among prominent gainers in the series as they ended with handsome gains of about 13.5%, 8.7% and 10.8% respectively. From the expiry perspective, market wide rollover of 62.71% was observed which was higher than the three month average of 61.33% while Nifty rollovers were at 57.83%, lower than 3 month average of 58.16%. Sectorally, the Sugar, Power and Capital Goods counters witnessed high rollovers while sectors like Technology, Realty and Cement  pockets observed relatively low rolls. Among individual stocks, vast rollovers were witnessed in heavyweights including Infosys (74%), Cairn (73%), HDFC (72%), Suzlon (78%) and GMR Infra (74%) while low rollovers were seen in stocks like HCL Tech (49%), ACC (53%) and ONGC (55%).

Finally, the BSE Sensex lost 66.75 points or 0.37% to settle at 18,078.50, while the S&P CNX Nifty declined by 22.05 points or 0.40% to close at 5,483.30.

The BSE Sensex touched a high and a low of 18,249.53 and 18,005.28 respectively. The BSE Mid cap and Small cap indices were down by 0.55% and 0.91% respectively.

The major gainers on the Sensex were Hindustan Unilever up 2.22%, BHEL up 1.74%, NTPC up 1.15%, RIL up 0.59% and TCS up 0.59%, while, Sterlite Industries down 4.09%, Hero MotoCorp down 2.68%, Bharti Airtel down 2.59%, Mahindra & Mahindra down 2.31% and Maruti Suzuki down 2.09% were the major losers on the index.

The top gainers on the BSE sectoral space were FMCG up 0.82%, Power up 0.64% and Oil & Gas up 0.35% while Realty down 2.46%, Metal down 1.41%, Auto down 0.79%, Capital Goods (CG) down 0.52% and TECk down 0.51% were the top losers on the BSE sectoral space.

Meanwhile, describing introduction of Goods and Services Tax (GST) as the most significant reform in the history of indirect taxes in the country, Union Finance Minister Pranab Mukherjee affirmed that once implemented it will bring about a paradigm shift in the arena of indirect taxation. With India being at the door step of implementing the crucial reform, the finance minister remained confident that GST will prove to be a more efficient system of taxation and is likely to give a boost to the tax revenues of the Centre and the States by removing barriers amongst States and converting the entire country into a common market.

Commending the performance of the Central Customs and Excise Department in adapting quickly and successfully to the changing economic environment, the finance minister stated the Central Excise revenue has more than doubled over the last ten years from Rs. 68,282 crore in 2000-01 to Rs 137,427 crore in 2010-11, which is 40% of the total revenue from Indirect Taxes. However, he said that still further efforts are required to ensure to meet the target of indirect tax collections for the current fiscal.

With India's indirect tax collections increasing to Rs 317,233 crore till January 2012 in the current financial year, which is 15% more as compared to the revenues of the corresponding period last year, the government was optimistic that the Budget Estimates for the financial year will be completely met.

The S&P CNX Nifty touched a high and low of 5,537.40 and 5,460.80 respectively.

The top gainers on the Nifty were BPCL up 6.47%, HUL up 2.51%, Powergrid up 2.46%, BHEL up 1.55% and Tata Power up 1.31%.

On the flip side, JP Associates down 6.56%, Sterlite Industries down 3.85%, Sesa Goa down 3.66%, PNB down 3.10% and Hero MotoCorp down 2.44% were the top losers on the index.

The European markets were trading mixed as France's CAC 40 down 0.14%, Britain's FTSE 100 up 0.23% and Germany's DAX down by 0.30%.

Stocks in Asian region fell on Thursday as investors remained concern that the rescue package of $170 billion announced for Greece on Tuesday will not be sufficient to keep the debt-laden country from eventually defaulting. Moreover worries over slowdown in the global economy, including higher oil prices and data showing the euro zone may be sliding toward recession, too dampened the sentiments.

Seoul composite lost over a percentage point as foreign investors remained sellers of a net 95.9 billion won ($85.17 million) worth of stocks, poised to end a four-session buying streak. Institutions continued selling for a seventh straight session, offloading 82.9 billion won worth of stocks. Indonesia and Singapore's index too lost near a percentage point in the trade, however, Japanese Nikkei share average advanced on Thursday to end just below 9,600, with a softer yen underpinning market sentiment.

NEGATIVE TERRAIN

Benchmarks holding red mark on the second consecutive day and extended early losses as investors booked profits from recent rallies on concerns over global economic conditions, including rising oil prices. The Nifty came down from 5,500 mark while Sensex holding 18,100 level. On sectoral front oil, FMCG and IT sectors were trading in green rest all were in negative territory. Meanwhile, shares of Sterlite Industries topped the selling list, losing over 4% after sources reclaimed that Sesa Goa will be merged with the company. DLF also fell 2% after initial spike due to selling of apartments in Gurgaon. On the global front, Asian shares and the euro fell on Thursday on concerns about global growth driven by higher oil prices and data showing the euro zone may slip into recession. Back home, the market breadth favoring the negative trend; there were 826 shares on the gaining side against 1,637 shares on the losing side while 106 shares remained unchanged.

The BSE Sensex is currently trading at 18,106.09, down by 39.16 points or 0.22%. The index has touched a high and a low of 18,209.56 and 18,075.61 respectively. There were 9 stocks advancing against 21 declines on the index.

The broader indices slipped deep and fast in red; the BSE Mid cap and Small cap indices declined by 1.00% and 1.15% respectively.

The top gaining sectoral indices on the BSE were Oil and Gas up by 0.86%, FMCG up by 0.65% and IT up by 0.14%. While, Realty down by 3.10%, Metal down by 1.76%, Capital Goods down by 1.00%, CD down by 0.99% and Auto down by 0.80% were the top losers on the index.

The top gainers on the Sensex were HUL up by 1.57%, SBI up by 1.48%, RIL up by 1.12%, BHEL up by 0.64% and Infosys up by 0.33%.

On the flip side, Sterlite Industries down by 4.92%, DLF down by 2.70%, L&T down by 1.85%, Bharti Airtel down by 1.71% and Tata Power down by 1.71% were the top losers on the Sensex.

Meanwhile, describing introduction of Goods and Services Tax (GST) as the most significant reform in the history of indirect taxes in the country, Union Finance Minister Pranab Mukherjee affirmed that once implemented it will bring about a paradigm shift in the arena of indirect taxation. With India being at the door step of implementing the crucial reform, the finance minister remained confident that GST will prove to be a more efficient system of taxation and is likely to give a boost to the tax revenues of the Centre and the States by removing barriers amongst States and converting the entire country into a common market.

Commending the performance of the Central Customs and Excise Department in adapting quickly and successfully to the changing economic environment, the finance minister stated the Central Excise revenue has more than doubled over the last ten years from Rs. 68,282 crore in 2000-01 to Rs 137,427 crore in 2010-11, which is 40% of the total revenue from Indirect Taxes. However, he said that still further efforts are required to ensure to meet the target of indirect tax collections for the current fiscal.

With India's indirect tax collections increasing to Rs 317,233 crore till January 2012 in the current financial year, which is 15% more as compared to the revenues of the corresponding period last year, the government was optimistic that the Budget Estimates for the financial year will be completely met.

The S&P CNX Nifty is currently trading at 5,489.00, lower by 16.35 points or 0.30%. The index has touched a high and a low of 5519.55 and 5481.55 respectively. There were 19 stocks advancing against 31 declines on the index.

The top gainers of the Nifty were BPCL up by 4.22%, PowerGrid up by 2.27%, HUL up by 1.66%, SBI up by 1.61% and Reliance Industries up by 1.27%.

On the flip side, Sterlite Industries down by 4.60%, JP Associate down by 4.31%, Reliance Infra down by 3.17%, DLF down by 2.98% and IDFC down by 2.49%, were the major losers on the index.

Most of the Asian equity indices were trading in the red; Shanghai Composite declined 0.01%, Hang Seng slid 0.70%, Jakarta Composite plunged 0.57%, KLSE Composite inched lower by 0.07%, Straits Times plunged 0.81%, Seoul Composite plummeted 1.03% and Taiwan Weighted descended 0.80%.

On the flip side, Nikkei 225 up by 0.44% was the lone gainer amongst Asian pack. 

MARKET SLIPS IN RED

After getting a modest start, local bourses have now capitulated to the selling pressure as investor's reluctance post previous session's rally has minced the sentiment of trade street in early deals.  Investors seem to be in fringe as relief over Greece's latest bailout has turned to doubts that the debt-stricken country can keep to its austerity programme. Market men are undecided whether they should buy more or wait for a pullback after the recent uptake of the bourses. However, volatility that has crept into the markets on the penultimate day of the F&O expiry series has kept the undertone cautious. On the global front, U.S. stocks ended little changed on Tuesday, paring gains after the Dow topped 13,000 for the first time since May 2008, and as higher oil prices damped prospects for the economy. Meanwhile, Asian shares are doing little to provide any direction as the regional counterparts are exhibiting mixed trend. However, the US future indices too are showing an uptick in the screen trade.

Back home, stocks from Oil & Gas, Information Technology and Health care counters have sustained their gains, however, stocks from Bankex, Consumer Durable and Realty counters are leading the markets from the bottom. The 30 share barometer index of BSE-Sensex- after slipping over 25 points is currently trading sub 18400 mark. Similarly, 50 share index of NSE-Nifty-too is trading sub 5600 mark. The broader indices too have succumbed to the selling pressure. The overall market breadth on BSE is supporting advances which are currently outdoing declines in the ratio of 1235:1076, while 116 shares remained unchanged.

The BSE Sensex is currently trading at 18,391.70, down by 36.91 points or 0.20%. The index has touched a high and a low of 18,523.78 and 18,369.25 respectively.   There were 16 stocks advancing against 14 declinning one's on the index.

The broader indices too succumbed to the selling pressure; the BSE Mid cap and Small cap indices were down by 0.33% and 0.09% respectively.

The top gaining sectoral indices on the BSE were Oil and Gas up by 1.39%, IT up by 0.59%, Health Care up by 0.46%, Power up by 0.28% and TECk up by 0.27%. On the flip side, Bankex down by 1.49%, CD down by 0.89%, Realty down by 0.66%, Capital Goods down by 0.62% and FMCG down by 0.47% remained the only losers on the index.

The top gainers on the Sensex were ONGC up by 2.02%, Sun Pharma up by 1.90%, RIL up by 1.38%, TCS up by 0.99% and Tata Power up by 0.91% and.

On the flip side, SBI down by 3.38%, DLF down by 2.32%, ICICI Bank down by 2.22%,  Sterlite Industries down by 1.56% and L&T down by 1.41% were the top losers on the Sensex.

Meanwhile, any reduction in petrol prices has been ruled out by the Petroleum and Natural Gas Minister S Jaipal Reddy. The minister stated that it is not possible to reduce prices especially when oil marketing companies are suffering huge losses due to fluctuations in the prices of crude in the international market. The losses are estimated to be around Rs 1.50 lakh crore.

Reddy said, there is constant pressure from the public and political parties to not to hike diesel, kerosene and LPG prices, but that isn't feasible given the crisis in Iran and Arab countries, the economic slowdown in European countries and the hiked dollar exchange rate, making global crude oil expensive.  Hence, there is no option other than increasing the prices on par with those in the international markets.

Admitting that the hike in fuel prices will have to be eventually borne by the common man, the minister said that elections cannot be used as an excuse by politicians to keep the costs subsidized. Reddy stated that if elections were the criteria to not raise prices, then fuel prices could never be hiked as India being the world's biggest democratic country, is faced with elections every year.

Petrol prices in India were liberalized a year ago and have climbed as international oil prices have risen. The government still subsidizes retail prices of diesel, kerosene and cooking gas.  

The S&P CNX Nifty is currently trading at 5,592.00, down by 15.15 points or 0.27%. The index has touched a high and a low of 5,629.95 and 5,584.70 respectively. There were 23 stocks advancing against 27 declining one's on the index.

The top gainers of the Nifty were ONGC up by 2.11%, Sesa Goa up by 1.93%, BPCL up by 1.67%, Sun Pharmaceuticals up by 1.66% and PowerGird Corporation up by 1.45%.

On the flip side, SBI down by 3.49%, Axis Bank down by 2.53%, ICICI Bank down by 2.23%, DLF down by 2.19% and M&M down by 1.63%, were the major losers on the index.

Most of the Asian equity indices were trading in the red; Hang Seng down by 0.08%, Jakarta Composite declined 0.34%, KLSE Composite slid 0.15%, Straits Times descended by 0.53% and Seoul Composite shed 0.19%.

On the flip side, Shanghai Composite gained 0.45%, Nikkei 225 added0.76% and Taiwan Weighted rose 0.87%.

ENCOURAGING SESSION

First trading day of February series F&O expiry week is turning out to be an encouraging session for the Indian benchmark indices which have climbed to multi-month high levels. The frontline indices have re-captured the psychological 5,600 (Nifty) and 18,400 (Sensex) levels in the afternoon session after garnering around a percent gains. The gains appeared even more prominent as they came on a day when most Asian markets declined. Coming from an extended weekend, investors took to hefty across the board buying on the back of encouraging reports that Finance ministers from the Euro-zone have finally struck a deal for Greece's second bailout package however, details were still being worked out in the early hours of Tuesday, more than 12 hours after discussions began. Sentiments also remained upbeat in the session after government released an encouraging India's first-ever CPI-based inflation data which showed inflation based for Rural Labourers (CPI-RL) and Agricultural Labourers (CPI-AL) fell to 4.92% and 5.27% in January from 6.37% and 6.72% in December. Stocks from the power sector continued to hog the limelight with hefty gains while the Realty and Metal pockets too are not far behind. However, the information technology counter remained the only chink in the armor as it traded in the negative terrain with moderate losses. On the global front, Asian markets are trading largely on a pessimistic note while European stock futures are indicating a higher opening for the markets there as sentiments remain positive on reports that European finance ministers reached an agreement on a Greek aid package.

Moreover, the broader markets too traded with fervor and amassed around a percent gains, performing largely in line with their larger peers. The bourses surged on good volumes of over Rs 1 lakh crore while market breadth on BSE was in favor of advances in the ratio of 1613:1082 while 120 scrips remained unchanged.

The BSE Sensex is currently trading at 18,420.07 up by 130.72 points or 0.71% after trading as high as 18,452.51 and as low as 18,293.80. There were 19 stocks advancing against 11 declines on the index.

The broader indices were trading on a positive note; the BSE Mid cap index gained 0.86% and Small cap gained 1.26%.

On the BSE sectoral space, Realty up 1.89%, Metal up 1.82%, Power up 1.59%, Capital Goods up 1.46% and Oil & Gas up 1.39% were the major gainers while IT down 0.28% was the only loser in the space.

BHEL up 4.47%, Tata Steel up 4.31%, Hindalco Industries up 3.51%, ONGC up 3.31% and SBI up 1.96% were the major gainers on the Sensex, while Tata Motors down 0.69%, Wipro down 0.53%, HDFC Bank down 0.37%, TCS down 0.34% and Infosys down 0.28% were the major losers in the index.

Meanwhile, reflecting sharp drop in prices of essential food items, inflation based on Consumer Price Index for Rural Labourers (CPI-RL) fell to 4.92 percent in January from 6.37 percent in December. The rate of price rise based on the Consumer Price Index for Agricultural Labourers (CPI-AL) also fell to 5.27 percent in January from 6.72 percent in December 2011, an official release said.

On a point-by-point basis, the CPI (RL) index stood at 619 points in January, the same level as in the previous month. The CPI (AL) also remained stable month-on-month at 618 points. Food index for rural labourers was down marginally by 0.33 percent on a monthly basis in January. However, prices of other goods continued to rise. Pan and supari was expensive by 1.45 percent in January, while fuel and lighting was expensive by 1.15 percent. Clothing, bedding and footwear was up also by 0.32 percent.

Miscellaneous items became dearer by 0.68 percent month-on-month for rural labourers. In the case of agricultural labourers, food prices went down by 0.50 percent on a monthly basis in the last month. But other items became expensive in January as compared to December. Pan and supari became expensive by 1.22 percent. Fuel and lighting became expensive by 1.14 percent and clothing, bedding and footwear by 0.33 percent. In January, miscellaneous items also went up by 0.85 percent for agricultural labourers month-on-month. 

The S&P CNX Nifty is currently trading at 5,611.50, higher by 47.20 points or 0.85% after trading as high as 5,617.75 and as low as 5,561.75. There were 37 stocks advancing against 13 declines on the index.

The top gainers on the Nifty were BHEL up 4.56%, Tata Steel up 4.49%, ONGC up 3.47%, Hindalco up 3.44% and R Infra up 2.89%.

Tata Motors down 0.69%, HDFC Bank down 0.52%, Wipro down 0.41%, HCL Tech down 0.39% and Maruti down 0.34% were the major losers on the index.

In the Asian space, Shanghai Composite slipped 0.20%, Hang Seng eased 0.27%, KLSE Composite dropped 0.06%, Nikkei 225 declined 0.21%, Seoul Composite lost 0.24% and Taiwan Weighted shed 0.42%.

On the flipside only Jakarta Composite advanced 0.46% and Straits Times added 0.01%. 

MARKETS CONTINUE TO RISE

Sealing of the long-awaited agreement for a crucial second bailout package for debt-stricken Greece, ahead of the first release of the new annual CPI inflation data propped up the sentiment at Dalal Street from the start of the trade. However, sustained buying by funds and retail investors despite muted reaction of Asian pacific markets have led to the additional traction in Indian equity markets.

India will release its first ever annual inflation data based on the consumer price index (CPI) on Tuesday, a move to monitor retail prices that is expected to make monetary policy more effective in addressing demand-driven pressures.

The barometer 30 share index of Bombay Stock Exchange (BSE)-Sensex- after gaining a century of points was seen flirting with 18400 level, while the widely followed 50 share index of National Stock Exchange (NSE)- too gaining over 15 points was at a sniffing distance of  5600 mark. Stocks from Realty, Power and Metal counters were topping the list of gainers. Gains were also led by frontliners in likes of Hindalco, Tata Steel, SAIL, Cairn India, SBI, ITC, and ONGC.  BHEL rose 3% reports that 19% import duty is likely on power equipment for mega projects However, stocks from Consumer Durable, Information Technology counters were the top losers on the BSE sectoral chart.

In stocks specific news, Kingfisher Airlines tanked 18% as company's bank accounts have been frozen suddenly. While, Essar Oil too plunged by  4.5% as company reported net loss of Rs 3,986 crore in Q3FY12 versus profit of Rs 273 crore Y-o-Y.  Back on the BSE sectoral chart, broader too showcased an enthralling performance as midcap index captured gains close to 0.75%, while the Small cap index rallied over a percent. The overall market breadth on BSE was in the favour of advances which thumped declines in the ratio of 1468:862, while 110 shares remained unchanged.

On the global front, Euro zone finance ministers concluded 13 hours of talks by sealing a bailout for the country that will resolve its immediate financing needs with a 130-billion-euro rescue package and measures to cut its debt to 121 percent of GDP by 2020.

Indian and US equity markets remained closed on account of local holiday yesterday. Meanwhile, Asian markets pricing in the optimism of Greek bailout agreement, failed to show any footing. The US future indices, however, were showing an uptick in the screen trade.

The BSE Sensex after rallying by 109.80 points or 0.60% is currently trading at 18,399.15. The index has touched a high and a low of 18,414.11 and 18,293.80 respectively. There were 22 stocks advancing against 8 declines on the index.

The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices surged 0.75% and 1.11% respectively.

The top gaining sectoral indices on the BSE were, Realty up by 2.06%, Power up by 1.88%, Metal up by 1.74%, CG up by 1.36% and Public Sector Undertaking up by 1.23%. While, Consumer Durable down by 1.36%, Information Technology down by 0.55%, TECk down by 0.23% were the only losers on the index.

The top gainers on the Sensex were ONGC up by 4.09%, BHEL up by 3.94%, Tata Steel up by 2.98%, Hindalco Industries up by 2.78% and Tata Power up by 2.23%.

On the flip side, TCS down by 1.32%, Wipro down by 0.60%, HDFC Bank down by 0.56%, Gail India down by 0.54% and Tata Motors down by 0.47% were the top losers on the Sensex.

Meanwhile, Finance Minister, Pranab Mukherjee has recently stated that the government is keen to bring Indian public sector unit (PSU) banks at par with their global peers while catering to the needs of our economy. He has appreciated the resilience shown by Indian banks during the global economic crisis but has cautioned that there is no room for complacency as the global environment is still uncertain. The minister further said that the government is taking steps to ensure that public sector banks have adequate capital to meet global risk norms.

By adding further, the finance minister said, the government was committed to maintain a minimum of 8% Tier-I capital (equity capital) in all public sector banks (PSBs), which is over and above the regulatory requirement of 6%. He said the government had provided capital to state- owned banks last fiscal, and it was taking necessary steps to keep banks adequately capitalised in 2012-13 as well. He said the Basel III capital regulations would be implemented from the beginning of next year.

BASEL III is a global regulatory standard on bank capital adequacy, stress testing and market liquidity risk agreed upon by the members of the Basel Committee on Banking Supervision in 2010-11. Basel III strengthens bank's capital requirements and introduces new regulatory requirements on bank liquidity and bank leverage. The draft guidelines on Basel III capital regulations was released December 30, 2011 and it is scheduled to be implemented from January 1, 2013.

In 2010-11, the government provided capital support to the tune of Rs 20,157 crore to public sector banks. They include Bank of Baroda, Union Bank of India, Oriental Bank of Commerce, UCO Bank and Dena Bank. This fiscal, the government will infuse over Rs 7,900 crore in SBI. It is further slated to capitalise more banks by March.

On the government's financial inclusion programme, the finance minister said that banking services to un-banked villages with a population of 1,000 or more will be provided within a couple of years. He added that banks can play a very major role through inclusive programmes like Swabhimaan, and by extending facilities to the large number of rural population. Commenting on the leakages due to subsidies the minister said that if these subsidies are provided through the banking network and institutional financial networks, the leakage will be reduced substantially.

Mukherjee said the government was in the process of implementing an e-payment system for direct credit of dues from the central government to the beneficiaries and the new payment system would bring transparency and expedite direct payments for subsidies from central paying units to the targeted beneficiaries of fertiliser, kerosene and cooking gas.

The S&P CNX Nifty is currently trading at 5,593.90, higher by 29.60 points or 0.53%. The index has touched a high and a low of 5,601.45 and 5,561.75 respectively.  There were 38 stocks advancing against 12 declines on the index.

The top gainers of the Nifty were ONGC up by 4.36%, BHEL up by 3.76%, Sesa Goa up by 3.13%, Tata Steel up by 2.96% and Hindalco Industries up by 2.32%.

HCL Tech down by 1.07%, TCS down by 1%, Tata Motors down by 0.88%, HDFC Bank down by 0.63% and IDFC down by 0.61% were the major losers on the index.

Most of the Asian equity indices were trading in the red, barring Jakarta Composite; Shanghai Composite declined 0.37%, Hang Seng shed 0.47%, KLSE Composite inched lower by 0.06%, Nikkei 225 trimmed 0.31%, Straits Times inched lower by 0.08%, Seoul Composite surrendered 0.52% and Taiwan Weighted descended by 0.48%.

On the flip side, Jakarta Composite gained 0.46% was the lone gainer amongst the Asian pack.