MARKETS BELOW NEUTRAL LINE

Indian equities continue to trade below neutral line in the late morning session, there is not much happening in the markets and the indices are trading near the lows of the day. On the global front, Asian markets were trading mixed unable to give any cue to domestic markets, after a Chinese government report showed that Chinese industrial companies' profits fell for a fourth month in July. Back home, traders were seen piling up position in Oil & Gas, CD and Auto sector, while selling was witnessed in Banking, Realty and IT sector. ICICI Bank, State Bank of India, Axis Bank and Kotak Mahindra Bank from banking sector were trading in red exerting pressure on the market, while realty majors DLF, HDIL and India Bulls Real Estate too were pressurizing the markets. On the other hand, Reliance Industries, Oil and Natural Gas Corporation, Gail (India), Cairn India from Oil &Gas pack were seen trading firm in green, holding up the markets from dipping further.

In the scrip specific development, Pipavav Defence soared on inking technology partnership pact with SAAB Technology. ONGC gained on inking pact with Mitsui & Company. Mahindra Holidays & Resorts rose on acquiring 100% equity share capital of GPPL.

The NSE Nifty and BSE Sensex were managing to hold their psychological 5350 and 17700 levels respectively. The market breadth on BSE was positive in the ratio of 1209:919 while 98 scrips remained unchanged.

The BSE Sensex is currently trading at 17774.12 down by 9.09 points or 0.05% after touching a high of 17820.07 and low of 17746.06. There were 14 stocks advancing against 16 declines on the index.

The broader indices were trading on a positive note; the BSE Mid cap index was up by 0.21%, while Small cap index was up by 0.32%.

On the BSE sectoral space, Oil & Gas up by 0.81%, CD up by 0.32%, Auto up by 0.21%, HC up by 0.18% and FMCG up by 0.12% were the gainers while Bankex down by 0.62%, Realty down by 0.56%, IT down by 0.49%, Metal down by 0.42% and CG down by 0.41% were the losers on the index.

Bharti Airtel up by 1.96%, Mahindra & Mahindra up by 1.43%, RIL up by 1.04%, Bajaj Auto up by 0.83%, Cipla up by 0.71% were the major gainers on the Sensex, while Jindal Steel down by 1.95%, Sterlite Industries down by 1.91%, ICICI Bank down by 0.83%, L&T down by 0.77% and Infosys down by 0.66% were the major losers on the index.

Meanwhile, the Reserve Bank of India (RBI) has widened its scope of probe for alleged breach of controls against money laundering and terror financing, from the affairs of British banking giants HSBC to a host of other foreign banks. In double trouble for these foreign players, capital market regulator SEBI too may join the investigations, as there are qualms of funds from these banks being routed to the stock market through foreign investors and other entities.

The investigations, which are made to ensure that the foreign banks' compliance to various fair banking norms in the wake of certain global event follow developments in the US, where a host of European banks, besides HSBC and Standard Chartered, are being probed for their alleged role in exposing the American financial system to money laundering and terror-financing risk.

The RBI, in the previous week, initiated inspection of the Anti- Money Laundering (AML) and Know Your Customer (KYC) systems of StanChart and HSBC, following the news reports of involvement of HSBC, USA, in money laundering activities and of Standard Chartered Bank, USA, for violating sanctions imposed on Iran by US Government.

Earlier this month, the New York State Department of Financial Services blamed Standard Chartered of hiding about 60,000 secret transactions with the Iranian government, involving a whopping $250 billion, besides exposing the US financial system to terrorists, weapon dealers and drug kingpins.  The S&P CNX Nifty is currently trading at 5,385.95, down by 0.75 points or 0.01% after trading in a range of 5,399.15 and 5,375.85. There were 19 stocks advancing against 29 declines while 2 stocks remains unchanged on the index.

The top gainers on the Nifty were Bharti Airtel up by 1.96%, Mahindra & Mahindra up by 1.66%, Cairn up by 1.36%, Ranbaxy by 1.32% and Bajaj-Auto up by 1.03%. While, Jindal Steel down by 1.89%, PNB by 1.37%, DLF down by 1.25%, Axis Bank down by 1.21% and Bank Baroda down by 1.12% were the top losers on the index.

Asian indices were trading on mix note; Kospi Composite Index up by 0.01%, Nikkei 225 up by 0.32%, KLSE Composite up by 0.03%, and Taiwan Weighted up by 0.05% while  Straits Times down by 0.16%, Hang Seng index down by 0.16%,and Shanghai Composite down by 1.44% were the losers.