MARKETS CONTINUE TO TRADE IN RED

Indian benchmarks- Sensex, Nifty were trading lower by 0.25% in the late morning session, extending losses for the fourth straight session, as funds and retail investors engaged booking profit amid a weak trend in global markets. Market sentiment has been dented ever since the Reserve Bank of India disappointed investors on January 29 with a more cautious than expected stance on future rate cuts. Trade remained range bound in the lead-up to the presentation of the 2013/14 budget on February 28. Finance Minister P. Chidambaram has reiterated his commitment to control spending, especially at a time when India faces fiscal and current account deficits. On the global front, all the Asian equity indices are trading in the negative terrain as investors booked profits from recent strong rallies on worries that a potential political shake-up could disrupt the euro-zone's efforts to resolve its debt crisis. Back home, the traders were seen piling up position in Health Care and IT while selling was seen in Realty, Metal and Consumer Durables sectors. In scrip specific development, Nestle India soared on acquiring 26% stake in Indocon Agro and Allied Activities. The public sector lender, Bank of Baroda was trading under pressure on reporting dip in net profit by 21.6% for the third quarter of the current financial year, which ended on December 31, 2012. The slip in net profit was due to higher provisioning for bad loans coupled with dip in non-interest income for October-December quarter. Jain Irrigation Systems dropped on reporting a net loss of 31.17 crore in December quarter. Jubilant Foodworks slipped on reporting a lower-than-expected same store sales growth in the October-December quarter. Kingfisher Airlines plunged on reporting Rs 755 crore loss for the third quarter of the current fiscal.

The NSE Nifty and BSE Sensex were managing to hold their psychological 5950 and 19,700 levels respectively.

The market breadth on BSE was negative; advances: declines in the ratio of 617:1379.

The BSE Sensex is currently trading at 19702.22 down by 48.97 points or 0.25% after trading in a range of 19711.37 and 19662.70. There were 15 stocks advancing against 15 declines on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.72% and Small cap index was down by 0.90%.

The top gaining sectoral indices on the BSE were, Health Care up by 0.51% and IT up by 0.01% while, Realty down by 1.06%, Metal down by 0.85%, Consumer Durables down by 0.74%, Capital Goods down by 0.64% and Power down by 0.57% were the losers on the index.

The top gainers on the Sensex were Sun Pharma up by 3.52%, Gail India up by 1.89%, Tata Power up by 0.95%, Mahindra & Mahindra up by 0.80% and Bajaj Auto up by 0.62%.

On the flip side, BHEL was down by 2.69%,Hero MotoCorp was down by 1.51%,Coal India was down by 1.47%  Jindal Steel was down by 1.45% and Sterlite Industries was down by 1.41% were the top losers on the Sensex.

Meanwhile, economic think-tank, National Council of Applied Economic Research (NCAER) has lowered its projection for Indian economic growth in current fiscal to 5.6 percent from 5.9 percent but projected it higher to 6.1 percent for the 2013-14. NCAER  in its report on Quarterly Review of the Economy 'based on quarterly model estimates, has said that its preliminary estimates show GDP growth in constant 2004-05 prices (to be) at 6.1 percent in 2013-14'.

As per NCAER report, economic slowdown is evident not only on the production side of the economy but also on the demand side. NCAER report estimates downward revision of GDP growth rate in the final two quarters, as compared to the previous estimate in October mainly due to contraction of output in all three sectors - agriculture, industry and services.  The report further stated that lower agricultural output is explained by high deficit in rainfall, while, lower industrial and services output growth is a result of decline in growth and government expenditure.

NCAER's report has highlighted that in the first half of 2012-13, the manufacturing sector alone declined steeply to 0.49 percent, which is a record decline and acts as a severe pull-down factor for the growth of GDP. While, the services sector has been slowing down and there are indications that the sector will register low growth in the current fiscal.

Further, the report also added that, the slowing down of consumption will negatively affect the growth in the current fiscal. The investment and private consumption were significantly contracted during the first half of the fiscal, while; the meager growth of investment will reduce growth both in the current and in the next fiscal, NCAER said in the review.

Elaborating the reasons for decline in private investment and consumption, it stated that, in the current fiscal, private investment is affected by high domestic interest structure and unsuitable business climate, while, the private expenditure is suffocated by persistent elevated inflation led by rising input cost.

The S&P CNX Nifty is currently trading at 5,964.25 down by 23.00 points or 0.38% after trading in a range of 5,968.05 and 5,947.90. There were 15 stocks advancing against 33 declines while 2 stocks remains unchanged on the index.

The top gainers of the Nifty were Sun Pharma up by 3.24%, Gail up by 1.75%, ACC up by 0.80%, Tata Power up by 0.70% and M&M up by 0.53%.

On the flip side, Jaiprakash Associates down by 3.08%, BHEL down by 2.56%, Bank of Baroda down by 2.39%, Sesa Goa down by 1.80% and  Jindal Steel down by 1.73% were the major losers on the index.

All the Asian equity indices were trading in the red; Shanghai Composite declined 9.80 points or 0.40% to 2,418.35, Hang Seng tumbled 410.82 points or 1.73% to 23,274.18, Jakarta Composite dipped 16.53 points or 0.37% to 4,474.04, KLSE Composite slipped 2.46 points or 0.15% to 1,632.09, Nikkei 225 crumbled 183.29 points or 1.63% to 11,077.06, Straits Times dropped 27.12 points or 0.81% to 3,270.74, KOSPI Composite contracted 13.19 points or 0.68% to 1,940.02 and Taiwan Weighted was down by 48.17 points or 0.61% to 7,870.35.