SOFT START

The domestic bourses have made a soft start and fell over half a percent in early trade led by profit booking after yesterday's decent rally amid weak Asian counters. Stock markets across Asia largely drifted into the negative terrain on Wednesday after sentiments got undermined by overnight decline on Wall Street. Though, the US markets reversed some of their gains overnight following lackluster housing and consumer confidence data. Back home, cautious approach adopted by investors ahead of Thursday's monthly expiry in the derivatives segments also influenced the trading sentiment. Moreover, the Indian rupee moving towards 51 to the dollar, depreciating by 23 paise to 50.92 a dollar too is dampening the sentiments. Meanwhile, barring healthcare space, all other sectoral indices traded lower on the BSE. Consumer durables, metal, realty and banking led the declines. Among individual stocks, IVRCL rallied in opening trades after the company said that Essar Group has bought additional 5.31% stake in the company through open market purchase. The broader indices too were struggling to get some traction and the market breadth on the BSE was negative; there were 614 shares on the gaining side against 870 shares on the losing side while 63 shares remained unchanged.

The BSE Sensex opened at 17,234.48; about 23 points lower compared to its previous closing of 17,257.36, and has touched a low of 17,135.76 while high remained its opening.

The index is currently trading at 17,138.40 down by 118.96 points or 0.69%. There were 5 stocks advancing against 25 declines on the index.

The overall market breadth has made a negative start with 39.69% stocks advancing against 56.24% declines. The broader indices too were trading in the red; the BSE Mid cap and small cap indices declined 0.36% and 0.23% respectively.

The only gaining sectoral index on the BSE was HC up by 0.49%. While, CD down by 1.59%, Metal down by 1.35%, Realty down by 1.22%, Bankex down by 1.12% and Auto down by 0.73% were the top losers on the index.

The top gainers on the Sensex were Sun Pharma up by 0.90%, M&M up by 0.75%, Tata Power up by 0.52%, Cipla up by 0.35% and RIL up by 0.11%.

On the flip side, Sterlite Industries was down by 2.54%, Hindalco was down by 1.97%, Tata Motors was down by 1.43%, Jindal Steel was down by 1.41% and DLF was down by 1.39% were the top losers on the Sensex.

Meanwhile, India's steel production has increased by 6.8% to 63.894 million tonnes in the period April-January of this fiscal, as compared to the same period last year. Further, steel production during the entire 2010-11 fiscal was 66.013 million tonnes, up 8.8% over 60.624 million tonnes in 2009-10, as per the country's steel minister, Beni Prasad Verma.

India has been a net importer of steel during the last three years and the trend has continued so far in the current fiscal as well. During the April-January period of the current fiscal, India imported 5.59 million tonnes finished steel against 3.45 million tonnes over the corresponding period last year. In 2010-11, steel exports stood at 3.46 million tonnes compared to 6.79 million tonnes of imports.

The government has taken various steps to maintain steady supply position in the domestic market and also to boost steel production in the country. It has increased export duty on iron ore exports to 30% and brought import duty on raw materials such as coking coal and steel melting scrap to zero.

Steel prices in the country are deregulated and hence it is decided by the individual producers based on various market conditions such as demand-supply scenario, movement in international steel prices, cost of raw materials and other input costs.

The S&P CNX Nifty opened at 5,231.70; about 12 points lower compared to its previous closing of 5,243.15, and has touched a high and a low of 5,232.10 and 5,205.20 respectively.

The index is currently trading at 5,206.05, lower by 37.10 points or 0.71%. There were 10 stocks advancing against 40 declines on the index.

The top gainers of the Nifty were Dr Reddy up by 1.23%, Sun Pharma up by 0.95%, M&M up by 0.91%, Ranbaxy up by 0.86% and HCL Tech up by 0.63%.

On the flip side, Sterlite Industries down by 2.41%, Cairn down by 2.27%, Hindalco down by 2.25%, JP Associates down by 2.15% and Sesa Goa down by 2.02%, were the major losers on the index.

Most of the Asian equity indices were trading in the red; Shanghai Composite was down 35.28 points or 1.50% to 2,311.90, Hang Seng was down 199.25 points or 0.95% to 20,847.66, Jakarta Composite was down 7.74 points or 0.19% to 4,071.64, KLSE Composite was down 1.67 points or 0.11% to 1,586.43, Nikkei 225 was down 96.58 points or 0.94% to 10,158.57, Straits Times was down 13.25 points or 0.44% to 3,005.66 and Seoul Composite was down 7.90 points or 0.39% to 2,031.86.

On the flip side, Taiwan Weighted was up by 12.27 points or 0.15% to 8,041.73.