MODEST GAINS

The Indian markets are trading firm in the mid morning session, overcoming the initial volatility. Though there is not much positive triggers that could move the indices higher still the benchmark indices are maintaining their traction. On the positive side, the broader indices have gathered steam and are outperforming the benchmarks. The traders are waiting for the European markets opening to take further cue from the domestic markets, as the regional markets too are trading cautiously despite G8 leaders pledge to combat financial turmoil in the region and to keep Greece in the euro zone. Back home, result reaction was keeping the markets ticking and SBI's better than expected numbers were still helping the whole banking gauge to strengthen further.

The BSE Sensex is currently trading at 16,211.18, down by 58.43 points or 0.36%. The index has touched a high and low of 16,286.14 and 16,172.05 respectively.  There were 23 stocks advancing against 7 declining ones on the index.

The broader markets were out performing the benchmarks; the BSE Mid cap and Small cap indices were up by 0.62% and 0.80% respectively.

The top gaining sectoral indices on the BSE were Realty up by 1.47%, Bankex up by 1.08%, CG up by 0.95%, Power up by 0.92% and CD was up by 0.87%.

On the other hand defensive FMCG down by 0.28%, IT down by 0.20% and TECk down by 0.03% were the only losers on the index. The top gainers on the Sensex were, SBI up by 2.92%, Maruti Suzuki up by 2.19%, Tata Power up by 2.02%, DLF up by 1.80%, Coal India up by 1.60%.

On the flip side, Tata Steel down by 1.79%, Bajaj Auto down by 1.43%, Infosys down by 1.23%, Wipro down by 0.93% and ITC down by 0.92% were the top losers on the Sensex.

Meanwhile, the final cabinet note on the issue of allowing foreign airlines to buy upto 49% stake in domestic airline has been moved and it is expected that the government will soon take a view on it. It is also believed that the Prime Minister will have consultations with senior ministers to build consensus on the contentious issue before it is presented in front of the cabinet.

So far in India, foreign direct investment (FDI) in the airline industry is permitted but to only those who are not connected with the industry in any way. Foreign airlines are not allowed to invest in Indian airlines. Currently the sector is going through a rough phase with almost all airlines running into losses. Hence the government is looking at options to help the distressed carriers.

The Finance Minister in his budget speech had expressed the government's intention to allow foreign airlines to participate in the Indian airline industry. However the move could face hurdles if other partners in the UPA coalition decide to oppose it as was seen on the issue of allowing 51% of FDI in multi-brand retail.

The response from the domestic airlines has been mixed. Kingfisher airline which is currently in a debt of Rs 7000 crores is pitching for it strongly whereas Jet Airways and Indigo are opposing the FDI.

The S&P CNX Nifty is currently trading at 4,907.85, up by 16.40 points or 0.34%. The index has touched a high and low of 4,933.35 and 4,888.50 respectively. There were 35 stocks advancing against 15 declining ones on the index.

The top gainers of the Nifty were SBI up by 3.05%, Reliance Infra up by 2.91%, Tata Power up by 2.75%, Kotak Bank up by 2.43% and Maruti was up by 2.28%.

On the flip side, Tata Steels down by 1.94%, IDFC down by 1.60%, Infosys down by 1.17%, ITC down by 1.15% and ACC down by 1.125 were the major losers on the index.

The Asian counters were still showing mixed trend; Shanghai Composite gained 0.33%, KLSE Composite was marginally up by 0.06%, Nikkei 225 added 0.19%, KOSPI Composite was up by 0.82%, Taiwan Weighted was trading higher by 0.52% and Straits Times was up by 0.02%.

On the other hand, Hang Seng was down by 0.31% and Jakarta Composite lost 1.22%.