FIRM & STEADY

Indian equity markets pared some gains but continued to outperform its Asian peers amid expectation that the government's new motivational measures to be announced today will boost the currency and economy. However, rating agency Moody's stable outlook on India's sovereign rating also supported markets to a great extend. In currency markets, rupee rebounded against American currency on the back of positive expectations from RBI intervention. On sectoral front rate sensitive stocks like banking, realty and automobile were trading notably higher. Capital goods, metal and power stocks were also mostly up in positive territory, while information technology stocks were mostly subdued. On the global front, Asian shares traded lower despite gains on the Wall Street on Friday and ahead of EU summit later this week. Back home, the market breadth favoring positive trend; there were 1,675 shares on the gaining side against 705 shares on the losing side while 88 shares remained unchanged.

The BSE Sensex is currently trading at 17,080.26, up by 107.75 points or 0.63%. The index has touched a high and low of 17,131.15 and 17,023.06 respectively. There were 26 stocks advancing against 4 declining ones on the index. 

The broader indices continued to outclass larger peers; the BSE Mid cap and Small cap indices were trading higher by 0.83% and 0.96% respectively.

Realty up by 1.30%, Consumer Durable up by 1.09%, Capital goods up by 1.03%, Auto up by 1.00% and Bankex up by 0.98% were the top gaining sectoral index on the BSE, while Information Technology down by 0.16%, was the lone loser on the index.

The top gainers on the Sensex were Gail India up by 2.30%, Maruti Suzuki up by 1.98%, Tata Power up by 1.59%, ICICI Bank up by 1.45% and Tata Motors up by 1.38%. On the flip side, Hindalco Industries down by 0.38%, TCS down 0.34%, Infosys down 0.18% and ONGC down by 0.16% were top losers amongst the 30 scrip sensitive pack.

Meanwhile, Union Finance Minister Pranab Mukherjee, who is front runner in the race for becoming the next President of India, opined that the government is likely to come up with a host of measures to bolster market conditions. The finance minister stated that there are various steps that have been taken already and the government will be announcing further measures on June 25, 2012 to boost the wilting economic sentiment.

On growing economic growth concerns, the finance minister admitted that the gross domestic product (GDP) is showing signs of weakness but he remained confident that the economy will bounce back and sentiments would turnaround once government's measures are implemented. The government is also likely to come out with measures to revive investor confidence and check fiscal deficit and current account deficit.

The government is also likely to announce measures to rein in the beleaguered rupee's depreciating streak. The Indian currency, which has been Asia's worst performing currency, touched its historical lows of 57.31 against the American dollar on June 22, 2012. Expressing worries over sharp depreciation in rupee and inflationary pressures, Pranab Mukherjee explained that at a time when the global economy is in turmoil, no country including a large economy like India can anticipate that there will be pocket of development. He further stated that the third largest economy in terms of purchasing power parity cannot remain insulated from adverse external factors.

With rupee losing over 20 percent against the US dollar in the last one year, it is expected that the Finance Ministry along with Reserve Bank of India would resort to measures like refinancing exporters via foreign currency and an interest rate subvention. Besides the deposit program, relaxing limits on foreign investment could also be considered by the government to halt the currency's downslide.

The S&P CNX Nifty is currently trading at 5,179.85, higher by 33.80 points or 0.66%. The index has touched a high and low of 5,194.60 and 5,158.45 respectively. There were 40 stocks advancing against 10 declines on the index.

The top gainers of the Nifty were Cairn up by 2.28%, GAIL up by 2.19%, Maruti Suzuki up by 2.06%, Ambuja Cement up by 1.89% and IDFC up by 1.75%.

On the flip side, HCL Technologies down by 0.84%, BPCL down by 0.66%, Hindalco Industries down by 0.43%, Asian Paints down by 0.42% and TCS down by 0.24%, were the major losers on the index.

Most of the Asian equity indices were trading in the red. Nikkei fell by 0.66%, South Korea's Kospi shed 1.19%, Straits Times declined 0.30%, Jakarta Composite dropped 0.06%, Shanghai Composite lost 0.91%, Taiwan Weighted skid 0.77% and Hang Seng index down by 0.07%.

KLSE composite gained 0.16% was the only gainer amongst the Asian pack.