SUSTAINING GAINS

Indian equity markets sustaining their early gains continued to trade in fine fettle supported by the stocks belonging from the Power, Bankex and Metal counters. Increased buying by funds and retail investors amid covering-up of short positions by speculators on the penultimate day of June month's F&O expiry, also spurred gains in local equity markets. Additionally, gains of regional counterparts, also added to the vigour of the bourses. 30 scrip sensitive index, Sensex, capturing gains of over 0.50%, was at a striking distance of 17,000 mark, while the 50 share widely followed index, Nifty, too amassing gains of similar magnitude, neared the 5150 psychological level. Meanwhile, the broader indices continued to deliver performance at par with the frontline indices. Sanguinity in the equity markets was also led by stocks of Reliance Infrastructure and Tata Power, which rallied in the early trade after Delhi Electricity Regulatory Commission hiked power tariffs in Delhi that would be effective from July 1, 2012.

On the global front, Asian stocks were trading buoyant for the first time in five days amid speculation China will add to economic stimulus. The China Securities Journal said the country may introduce "more proactive" policies to ensure stable growth in the world's second-largest economy, while the Xinhua News Agency said China is planning measures to boost cooperation with Hong Kong. Meanwhile, the US future indices, continued to showcase mixed trend on the screen trade.

Closer home, the BSE Sensex is currently trading at 16,993.80, up by 87.22 points or 0.52%. The index has touched a high and low of 17,029.27 and 16,975.76 respectively.   There were 26 stocks advancing against 4 declines on the index. The overall market breadth on BSE was in the favour of advances which thumped declines in the ratio of 1407:585, while 94 shares remained unchanged.

The broader indices continued to deliver performance at par with the frontline indices; the BSE Mid cap and Small cap indices surged by 0.57% and 0.55% respectively.

The top gaining sectoral indices on the BSE were, Power up by 1.14%, Bankex up by 0.88%, Metal up by 0.86%, Information Technology up by 0.85% and Realty up by 0.74%. On the flip side, Auto down by 0.41%, Consumer Durable down by 0.25%, Oil & Gas down by 0.15% were the laggards of the BSE sectoral chart.

Tata Power up by 2.51%, Hindalco Industries up by 1.78%, ICICI Bank up by 1.56%, NTPC up by 1.53% and Tata Steel up by 1.13% were the top gainers on the index. On the flip side, Tata Motors down by 1.56%, ONGC down by 1.03%, HUL down by 0.32% and Mahindra & Mahindra down by 0.10% were the losers on Sensex.

Meanwhile, a study by industry body Fertilizer Association of India has anticipated that the demand supply gap of urea will rise 11 million tonnes (MT) by 2016-17. Currently, India produces 22 MT tonnes while the consumption is around 28 MT, the shortfall of 6 MT is covered through imports. Thus, it is essential to construct new urea plants which can fill the gap of estimated 11 MT.

Till 2001-02, India had adequate production of the key fertilizer, however, with the rising consumption and lack of major investment, led to the demand-supply gap which is widening now.

In order to infuse more capital in the urea sector considering the high cost of capital, a contributing policy is essential.  According to the planning commission for 12th five year plan (2012-17), India needs to invest Rs 40,000 crores in the sector to increase the production capacity to 33.7 million tonnes by the end of 12th five year plan.

The S&P CNX Nifty is currently trading at 5,149.55, higher by 28.75 points or 0.56%. The index has touched a high and low of 5,159.10 and 5,145.65 respectively.  There were 41 stocks advancing against 9 declines on the index.

The top gainers of the Nifty were Tata Power up by 2.30%, Reliance Infra up by 2.19%, IDFC up by 2.15%,  Hindalco Industries up by 1.87% and ICICI Bank up by 1.55%.

On the flip side, Tata Motors down by 1.82%, ONGC down by 1.23%, Kotak Bank down by 0.87%, ACC down by 0.62% and BPCL down by 0.45% remained the top losers on the index.

Most of the Asian equity indices were trading in the green; Shanghai Composite gained 0.34%, Hang Seng Index soared 1.10%, Jakarta Composite surged 0.93%, KLSE Composite added 0.47%, Nikkei 225 accumulated 0.34%, Straits Times Index advanced 0.96%, Taiwan Weighted climbed 0.67% and KOSPI Composite Index rose by 0.02%.