HOPE PROPELLS THE MARKET

Support came to Indian equity markets at lower levels, as investor's digesting slew of disappointing macro-economic reports, began to shop for fundamentally strong stocks available at lucrative prices. In absence of any global leads, given most of the Asian markets remained closed for holiday and the remaining one's showcasing mixed trend, Indian equity markets took a turn for the worst after India's annual industrial output growth measured by index of industrial production (IIP), contracted by 0.6% at 179.3 for the month of December 2012 against contraction of 0.1%, later revised to a reading of -0.8% in the previous month.

However, this weak data only aided markets in recouping losses as the recent reading is expected to pile up some more pressure on the Reserve Bank of India (RBI) to cut its policy rate by a further 25 basis points, in its next policy review on 19 March, which caving into growing clamour for a rate cut, in 'Third Quarter Review of Monetary Policy 2012-13', went ahead and slashed  repo rate by 25 basis points to 7.75 per cent against 8 per cent earlier and reduced cash reserve ratio (CRR) of scheduled banks by 25 basis points from 4.25 per cent to 4.0 per cent of their net demand and time liabilities (NDTL).

Thus, recuperating from intra-day's low, 30 share index, Sensex, was trading 19500 level, with gains of over quarter of a percent. Likewise, 50 share widely followed index, Nifty, after bouncing off from red, was trading above the 5900 level albeit with slender gains. However, broader indices continuing to underperform were showcasing negative trend.

Meanwhile, stocks from Oil & Gas, HealthCare and Public Sector Undertaking counters continued to provide the required fillip to the Indian equity markets, besides rate sensitive Banking and Auto counters. On the flip side, Realty, Information Technology and Power counters kept a lid at further gains of bourses. The overall market breadth on BSE was in the favour of declines which wee outnumbering declines in the ratio of 1629:854, while 112 shares remained unchanged.

The BSE Sensex is currently trading at 19514.95, up by 54.38 points or 0.28% after trading in a range of 19521.72 and 19438.53. There were 18 stocks advancing against 11 declines on the index, while one stock remained unchanged.

The broader indices were trading in red; the BSE Mid cap and Small cap index were trading lower by 0.58% and 0.83% respectively.

The top gaining sectoral indices on the BSE were Oil & Gas up by 1.01%, Health Care up by 0.79%, PSU up by 0.52%, Auto and Consumer Durables were up by 0.39%. While, Realty down by 4.17%, IT down by 0.75%, Power down by 0.52%, TECk down by 0.47% and Metal down by 0.43%were the top losers on the index.

The top gainers on the Sensex were ONGC up by 2.43%, Bharti Airtel up by 1.96%, Sun Pharma up by 1.91%, Bajaj Auto up by 1.09% and Tata Motors up by 1.02%,.

On the flip side, Jindal Steel down by 2.84%, Infosys down by 1.46%, Sterlite Industries down by 1.31%, Tata Power down by 0.82% and Cipla down by 0.49% were the top losers on the Sensex.

Meanwhile, in yet another disappointment for the street after IIP numbers, annual rate of inflation, based on the consumer prices index (CPI) in India, crept higher in the month of January at 10.79%. According to the data released, provisional annual inflation rate based on all India general CPI (Combined) for January 2013 on point to point basis stood at 10.79% as compared to 10.56% for the previous month of December 2012.

According to the Ministry of Statistics and Programme Implementation, which released the monthly provisional CP on Base 2010=100 along with annual inflation rates for January 2013, all India provisional General (all groups), CPI numbers of January 2013 for rural, urban and combined were at 127.4, 124.9 and 126.3 respectively. The corresponding inflation rates for rural and urban areas for January came in at 10.88% and 10.73% respectively as against December's 10.74% and10.42%, respectively, which indicated that the rate of price rose in rural areas.

India has the highest retail inflation among the BRICS group of emerging economies - Brazil, Russia, China, and South Africa -- and is way above the Reserve Bank of India (RBI)'s comfort level. However, unlike most central banks, the RBI uses wholesale inflation in its policy formulation, as annual consumer price inflation data was only launched last year in January.

The S&P CNX Nifty is currently trading at 5,908.70, up by 10.85 points or 0.18% after trading in a range of 5,913.30 and 5,886.45. There were 28 stocks advancing against 21 declines on the index, while  stock remained unchanged.
The top gainers of the Nifty were ONGC up by 2.58%, HCL Tech up by 2.01%, Sun Pharma up by 1.94%, Bharti Airtel up by 1.82% and Bajaj Auto up by 1.06%.

On the flip side, JP Associate down by 3.78%, Jindal Steel down by 2.77%, DLF down by 1.82%, Infosys down by 1.45% and IDFC down by 1.36% were the major losers on the index.

Most of the Asian equity indices were trading in the green; Jakarta Composite jumped 0.67% and Nikkei 225 soared 1.94%.

On the flip side, KOSPI Composite was trading lower by 0.26%. Meanwhile, Hong Kong, China, Taiwan, Singapore and Malaysia are all closed close for trade. Hong Kong and Singapore will resume trading on February 13 and Taiwan will reopen on February 14.