POSITIVE START

Stock markets in India got off to a positive start on the first day of June series futures and options (F&O) contract expiry week and the benchmark equity indices are trading with gains of around three fourth of a percent in morning trades. The frontline gauges are looking set to breach the psychological 17,100 (Sensex) and 5,200 (Nifty) levels in the session as investors continue to show across the board buying interest.  After showing a smart bounce back from intraday low levels and closing with marginal losses in last session, the domestic markets went on to outclass all Asian peers on Monday's morning trades amid growing optimism that the government would unveil measures to boost Asia's third largest economy and shore up the falling rupee. Traders were also eyeing the movement of rupee, which has appreciated to 56.54 against a dollar after hitting fresh historical lows of 57.31 in last session. Meanwhile, stocks from the retail sector traded on a positive note amid growing speculations that the narrowing window of opportunity to act will likely force the government to undertake some long-overdue economic reforms like implementing FDI in multi-brand retail within the next three to six months.

On the global front, the Asian markets are largely exhibiting weak trend and barring the South Korean benchmark, which plunged over one and half a percent, most indices were trading with about half a percent cuts. On the BSE sectoral space, across the board buying interest was evident with Realty and Bankex counters leading from the front. Apart from the two rate sensitive counters, which traded with gains of over a percent each, the Metal and Power pockets too surged about a percent and supported the upside.

Moreover, the broader markets too traded on a sanguine note with strong gains of about a percent and performed in tandem with their larger peers. The bourses surged on good volumes while the market breadth on BSE was in favor of advances in the ratio of 1251:388 while 70 scrips remained unchanged.

The BSE Sensex opened at 17,038.77; about 66.26 points higher compared to its previous closing of 16,972.51, and has touched a high and a low of 17,116.67 and 17,023.06 respectively. The index is currently trading at 17,093.89, up by 121.38 points or 0.72%. There were 29 stocks advancing against 1 decline on the index.

The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices were trading up by 0.96% and 0.89% respectively.

All the sectoral indices on BSE were trading in green, Realty and Bankex up by 1.29% each, Metal up by 1.12%, Consumer Durable up by 1.07% and Power up by 1.04%.

The top gainers on the Sensex were Maruti Suzuki up by 1.90%, Jindal Steel up by 1.87%, Tata Power up by 1.75%, ICICI Bank up by 1.59% and Coal India up by 1.58%. On the flip side, Infosys down by 0.25% was the lone loser amongst the 30 scrip sensitive pack.

Meanwhile, the Securities and Exchange Board of India (SEBI) has urged mutual fund houses to bring in pension-oriented funds as they have a large pool of money and a longer investment horizon. In this regard SEBI is in contact with tax authorities, to avail similar tax deduction benefits for mutual fund pension schemes as that of other pension funds.

Mutual fund pension schemes will allow legal mobilization of money on voluntary basis for long-term purposes .The pension products will lock money for a long term basis and will also entertain households' participation in capital markets.

Since now there are only two pension schemes available in the market , UTI Retirement Benefit Pension Plan, launched in December 1994 worth of Rs 800 crore and  Templeton India Pension Scheme launched in March 1997 worth Rs 217 crore,  pointing to a wide unleashed market opportunity for the AMCs.

Wen Jiabao has also vowed to encourage Chinese investments in India's infrastructure. India has set an investment target of at least Rs 2 lakh crore for core sector projects in the current fiscal. The two leaders also spoke of the joint mechanism set up by the two sides and agreed to form an inter-ministerial group within their respective countries on maritime matters, and deploy officials to hold formal talks on subjects pertaining to security, trade, navigation and other issues, including piracy.

The S&P CNX Nifty opened at 5,158.50; about 12.45 points higher compared to its previous closing of 5,146.05, and has touched a high and a low of 5,187.50 and 5,158.45 respectively.

The index is currently trading at 5,187.15, higher by 41.10 points or 0.80%. There were 47 stocks advancing against 3 declines on the index.

The top gainers of the Nifty were Reliance Infra up by 1.99%, Punjab National Bank up by 1.96%, Maruti Suzuki up by 1.90%, IDFC up by 1.86% and Gail India up by 1.81%

On the flip side, Grasim Industries down by 0.38%, Asian Paints down by 0.30% and Power Grid Corporation of India down by 0.09%, were the major losers on the index.

All the Asian equity indices were mostly trading in the red. Nikkei fell by 0.33%, South Korea's Kospi shed 1.33%, Straits Times declined 0.22%, Jakarta Composite dropped 0.18%, Taiwan Weighted skid 0.68% and Shanghai Composite lost 0.56%.

The only index in green were KLSE composite gained 0.16%, Hang Seng index added 0.34%.