MARKETS HOLD GAINS

Indian equity markets are holding up their gains in the mid morning session, with benchmark indices trading above their crucial levels of 16600 (Sensex) and 5000 (Nifty). The rate sensitive sectors are showing the maximum rebound from their two consecutive days of drubbing, while the IT sector is once again suffering some profit booking. The one factor that is supporting the market sentiments is the strength in the rupee. That has recovered quiet a lot from its all time low witnessed in last session after the Reserve Bank of India said that exporters will be required to convert 50 percent of their foreign exchange holdings into rupees, in a move to support the sagging local currency. Exporters will also be allowed to buy foreign currency only after utilizing all the foreign currency holdings in their accounts.

The BSE Sensex is currently trading at 16,619.11, up by 139.53 points or 0.85%.  The index has touched a high and low of 16,666.39 and 16,515.62 respectively. There were 27 stocks advancing against just three declines on the index. The overall market breadth on BSE was in the favour of advances in the ratio of 1336: 671, while 100 shares remained unchanged.

The broader indices were going neck-in-neck to the benchmarks; the BSE Mid cap and Small cap indices were up by 0.75% and 0.64% respectively.

The top gaining sectoral indices on the BSE were, Bankex up by1.24%, Oil & Gas up by 1.14%, Auto up by 1.06%, Capital Goods (CG) up by 1.03% and Public Sector Undertakings (PSU) was up by 0.88%. While, Information Technology (IT) down by 0.24% was the lone loser on the index.

The top gainers on the Sensex were Hero MotoCorp up by 2.14%, M&M up by 1.91%, Bajaj Auto up by 1.78%, SBI up by 1.78% and Cipla was up by 1.75%.

On the flip side, Maruti Suzuki down by 1.73%, Infosys down by 1.17% and Sun Pharma down by 0.30% were the only losers on the Sensex.

Meanwhile, India has received the highest amount of monthly foreign direct investment (FDI) of $8.1 billion in the month of March 2012. The highest ever number for the monthly FDI inflows has been that of $5.65 billion received in June last year. The money has come in despite the Vodafone tax dispute which many believed would impact FDI flows into the country.

The addition has taken cumulative FDI inflows for the fiscal 2011-12 to $36.50 billion. The inflows had aggregated to $19.42 billion in 2010-11, however, down from $25.83 billion in 2009-10.

A major contributor to the total inflows has been the deal worth $7.2 billion between Reliance Industries-British Petroleum (BP) which was announced in February 2011. The money from the deal has however come into the country in phases. The UK oil major has picked up a 30% stake in Reliance Industries' 21 oil-fields. The sectors that received substantial amounts of foreign FDI inflows during 2011-12 were services, pharmaceuticals, telecom, construction, power and metallurgical industries with Mauritius being the top FDI source.

The retrospective tax amendment brought in by the government in this year's Union Budget had received a lot flak with most believing that such changes would adversely affect India's FDI inflows. The government however has stood its ground and stated that the amendment was not brought in with the view of targeting any particular industry but was done to put the law into perspective. The provision has been approved by the Lok Sabha on May 08, 2012.

The S&P CNX Nifty is currently trading at 5,020.25, higher by 45.45 points or 0.91%. The index has touched a high and low of 5,037.95 and 4,984.15 respectively.  There were 44 stocks advancing against 6 declines on the index.

The top gainers of the Nifty were IDFC up by 4.34%, Axis Bank up by 2.56%, Kotak Bank up by 2.51%, Reliance Infra up by 2.49% and Cairn India was up by 2.40%.

On the flip side, Maruti Suzuki down by 1.89%, PNB down by 1.77%, Ranbaxy down by 1.36%, Infosys down by 1.18% and Sun Pharma down by 0.27% were the major losers on the index.

The other Asian indices continued to show mixed trend; Shanghai Composite declined 0.05%, Hang Seng lost 0.87%, Jakarta Composite was down by 0.26%, Straits Times lost 0.30% and Kospi Composite was marginally down by 0.07%.

On the other hand, Nikkei 225 was trading marginally in green, up by 0.03%, KLSE Composite was up by  0.22% and Taiwan Weighted gained 0.08%.