MARKETS TRADING IN NARROW BAND

Indian equity markets continued trading firm in the late morning session after a positive start and a subsequent fall from higher levels amid consistent buying at several blue chip counters. BSE benchmark Sensex and Nifty were trading in narrow band. In currency markets, Indian rupee lost against American currency snapping yesterday's gains despite higher openings in the local equity markets. On sectoral front stocks from power, oil and metal sections were also trading firm. Bank stocks are off their early highs. Healthcare and realty stocks too have given up some of their early gains. FMCG and consumer durables stocks were trading in red. On the global front, Asian shares rose for the second day in a row after opinion polls in Greece showed a lead for a party favoring the country's economic bailout in upcoming elections and amid expectations for a policy stimulus in China to support growth. Back home, the market breadth favoring positive trend; there were 1,194 shares on the gaining side against 1,039 shares on the losing side while 122 shares remained unchanged.

The BSE Sensex is currently trading at 16,481.87, up by 65.84 points or 0.40%. The index has touched a high 16,505.35 and low 16,410.23 of respectively. There were 22 stocks advancing against just 8 declines on the index.

The broader indices too have gained some additional traction; the BSE Mid cap and Small cap indices surged by 0.27% and 0.39% respectively.

The top gaining sectoral indices on the BSE were Auto up by 0.87%, Information Technology (IT) up by 0.83%, Oil & Gas up by 0.71%, Power up by 0.60% and PSU up by 0.56%. While, Consumer Durables (CD) down by 0.80% and Fast Moving Capital Goods (FMCG) down by 0.42% were top losers on the index.

The top gainers on the Sensex were Tata Motors up by 1.77%, Maruti Suzuki up by 1.66%, BHEL up by 1.22%, Coal India up by 1.16% and ONGC up by 1.08%.

On the flip side, ITC down by 0.98%, Hindalco down by 0.96%, DLF down by 0.90%, Bharti Airtel down by 0.68% and Bajaj Auto down by 0.51%, were the major losers on the index.

Meanwhile, the record production of wheat this year has led to a wheat procurement of 32.6 million tonnes (mt) in the marketing season of April-June. This is more than the government's estimate of 31.8 mt and is expected to grow further as wheat from Uttar Pradesh and Madhya Pradesh is still coming in.

UP and MP are seeing a daily crop arrival of up to 150,000 tonnes. This is in contrast to the almost dried up arrival of 16,500 tonnes daily seen by Punjab and Haryana who have already contributed record 12.8 mt and 8.6 mt of the grain respectively this year.

Punjab and Haryana had procured nearly 10.9 mt and 6.92 mt of wheat respectively in the previous season. Wheat purchase in Madhya Pradesh stood 6.9 mt this year while that in Uttar Pradesh was at 2.5 mt this year. Food Corporation of India (FCI) and other state agencies had procured about 24.8 mt in the year-ago period. In the entire 2011-12, the procurement stood at 28.33 mt.

India is the second largest producer of wheat in the world. It is estimated that India will produce a record 90.23 mt in the 2011-12 crop year (July-June). Its storage however, is likely to be a task for the government. This is because the government has a capacity to store 62.8 mt of foodgrains but the stocks are expected to go upto 75 mt by end of this month.

The Ranagarajan committee had suggested last week that the government should consider offloading of 10 mt of wheat to BPL and APL families and three million tonnes through open market sale. The panel had also suggested exports of 2 million tonnes of wheat from the government godowns.

The S&P CNX Nifty is currently trading at 5,000.65, higher by 15.00 points or 0.30%. The index has touched a high and low of 5,009.95 and 4,982.30 respectively. There were 29 stocks advancing against 21 declines on the index.

The top gainers of the Nifty were Ranbaxy up by 2.90%, HCL Tech up by 2.13%, Cairn up by 1.84%  Tata Motors up by 1.79%, and Maruti Suzuki up by 1.69%. 

On the flip side, IDFC down by 1.93%, BPCL down by 1.77%, Reliance Infra down by 1.19%, ITC down by 1.13% and Grasim down by 1.13% were the major losers on the index.

Most of the Asian equity indices were trading in the green; Shanghai Composite climbed 1.23%, Hang Seng Index advanced 0.72%, Straits Times Index added 0.45%, KOSPI Composite Index surged 1.41%, Taiwan Weighted spurted by 2.89%, KLSE Composite rose 0.07% and Nikkei 225 was up by 0.74%.

On the other hand, Jakarta Composite down by 0.34% was the lone loser among the Asian pack.