MARKET INCHES FORWARD

Brushing aside Infosys' FY13 gloomy guidance, Indian equity markets are depicting resilience as market men shift their focus to March's month headline inflation numbers, due to be released any time soon. The median consensus have pinned expectations for India's headline inflation at 6.70 per cent for March from a year ago, under the higher-than-expected 6.95 per cent recorded in February. However, barometer gauges have also geared up largely on expectation of a rate cut next week. Further, the firming trend in the global markets on account of easing worries of a funding crunch in the euro zone economies that has bolstered hopes for capital flows into riskier assets,  also are seen providing vigor to the local bourses, which for the second consecutive session are showcasing heartiness.

The 30 share barometer index of Bombay Stock Exchange (BSE)'s Sensex rallying over 25 points is currently trading above its crucial 17300 bastion. Although the FY13 Infosys guidance dragged the barometer gauge below the 17200 crucial level, however, surge of Auto, Power and Capital Goods stocks yanked the index higher above the crucial level. Only stocks from Information Technology and TECk counters on BSE are depicting weakness. The broader indices too have grabbed additional gains. Meanwhile, the widely followed index National Stock Exchange (NSE)'s Nifty after oscillating in a tight range is holding up the 5250 level.

The mood continues to remain optimistic on global front, Asian markets continued to trade firm after a strong rally on Wall Street, but gains were limited as data showed China's economy grew at its slowest pace in almost three years in the first quarter. The mood was lifted slightly by news that a North Korean rocket launch, which had raised regional security tensions, had failed. Meanwhile, the US future indices continued to show downtick in the screen trade.

Back home, the BSE Sensex is currently trading at 17,363.25, up by 30.63 points or 0.18%. The index has touched a high and low of 17,389.33 and 17,192.55 respectively. There were 27 stocks advancing against just 3 declining one's on the index.

The overall market breadth on BSE was in the favour of advances which piped declines in the ratio of 1395:718, while 106 shares remained unchanged.

The broader indices continued to outperform benchmarks; the BSE Mid cap and Small cap indices were trading higher by 0.79% and 0.68% respectively.

The top gaining sectoral indices on the BSE were, Auto up by 1.79%, power up by 1.47%, Capital Goods (CG) up by 1.46%, Fast Moving Consumer Goods (FMCG) up by 1.43% and Bankex up by 1.38%. While IT down by 6.09% and TECk (Technology) down by 4.43% were the only losers.

The top gainers on the Sensex were Tata Motors up by 2.45%, Bajaj Auto up by 2.35%, Sun Pharma up by 2.27%, Sterlite Inds up by 2.16% and SBI up by 1.88%. On the flip side, Infosys down by 8.93%, TCS down by 3.92% and Wipro down by 2.85% were the only losers on the Sensex.

Meanwhile, terming the Index of industrial production (IIP) numbers as 'disappointing', the Finance Minister, Pranab Mukherjee has stated that the government along with the RBI will take necessary steps to revive activity in the economy. As per the Finance Minister, the difficult global scenario combined with a tight monetary policy has pulled down industrial growth and have impacted investment recovery.

The statement is being seen as a hint towards a possible rate cut by the Reserve Bank of India (RBI) in its upcoming monetary policy on April 17, 2012. The RBI, which had raised interest rates 13 times since March 2010 to contain spiraling inflation, is yet to reverse its decision though the price situation has improved considerably. It kept the rates unchanged in its policy reviews in December 2011 and February 2012.

The IIP numbers that came out on April 12 revealed that industrial growth rate has slipped to 4.1% in February from 6.7% a year ago. Moreover, the January numbers had been revised from a substantial 6.8% to a meager 1.1%. This meant that the industrial growth had been dismal in January and had actually improved in the month of February. This revelation made the government data not only disappointing but also unreliable.

However, on the positive side, capital goods output for February 2012 showed an expansion of 10.6 % on back of domestic investment recovery. Also electricity recorded a good rate of growth at 8% against a 6% in same period last year. Further, Mukherjee attributed the negative growth in the consumer goods sector to considerable moderation in domestic demand. The consumer goods sector output declined by 0.2% in February as against a robust growth of 13.4% in the corresponding period a year ago.The S&P CNX Nifty is currently trading at 5,293.10, higher by 16.25 points or 0.31%. The index has touched a high and low of 5,299.70 and 5,240.30 respectively.  There were 46 stocks advancing against just 4 declines on the index.

The top gainers of the Nifty were JP Associates up by 2.70%, Bajaj Auto up by 2.63%, Reliance Infra up by 2.52%, Reliance Communication up by 2.42% and kotak Bank up by 2.37%.

On the flip side, Infosys down by 8.93%, TCS down by 4.12%, Wipro down by 3.01% and HCL Technology down by 2.62% were the major losers on the index.

Most of the Asian equity indices were trading in the positive terrain; Shanghai Composite up by 0.18%, Hang Seng surged by 31.62%, KLSE Composite added 0.15%, Nikkei 225 expanded by 1.04%, Straits Times shot up by 0.70%, Taiwan Weighted accumulated 1.36% and Seoul Composite gained 0.71%.

On the flip side, Jakarta Composite down by 0.02% was the lone loser among the Asian pack.