WEAKNESS PERSIST

Indian equity markets continued trading down tracking global cues amid worries about the near term outlook for the economy. The BSE Sensex and the 50-share NSE Nifty were down by over a quarter percent. In currency market, after opening lower on dollar's gains against other currencies, rupee marginally recovered in the late morning session. On sectoral front, Realty, metal, power and capital goods stocks were among the prominent losers, while few stocks from information technology and healthcare sectors were up in positive territory with smart gains. In global markets, Asian markets were trading lower, after US and European markets closed notably lower overnight. Back home, the market breadth was favoring negative trend; there were 1622 shares on the losing side against 741 shares on the gaining side while 102 shares remained unchanged.

The BSE Sensex is currently trading at 19696.98 down by 54.21 points or 0.27% after trading in a range of 19717.26 and 19662.70. There were 13 stocks advancing against 17 declines on the index.

The broader indices were also trading in red; the BSE Mid cap index was down by 0.71% and Small cap index was down by 0.85%.

The only gaining sectoral indices on the BSE were, Health Care up by 0.83% and IT up by 0.03% while, Realty down by 1.08%, Consumer Durables down by 0.93%, Capital Goods down by 0.82%, FMCG down by 0.63% and Power down by 0.61% were the top losers on the index.

The top gainers on the Sensex were Sun Pharma up by 4.06%, Gail India up by 1.42%, Cipla up by 0.86%, Tata Power up by 0.75% and Maruti Suzuki up by 0.67%.

On the flip side, BHEL down by 3.15%,Tata Motors  down by 1.71%, Hero MotoCorp down by 1.61% , Sterlite Industries down by 1.41% and Reliance down by 1.11% were the top losers on the Sensex.

Meanwhile, global rating agency Fitch has said that the Budget for 2013-14 will be an important event to gauge the government's commitment to fiscal consolidation and reform. Fitch ratings, which has already downgraded outlook on India's sovereign ratings to negative, said that the government policy pronouncements are positive signals to keep fiscal deficit under control and must carry on with reforms, which are the parameters rating actions will be judged.

The rating agency has emphasized that political and implementation risk remain significant and has said that India's patchy performance on policy implementation and the approach of elections in 2014 could impede fiscal consolidation, which is reflected in the Negative Outlook on India's 'BBB'-rating, the lowest rating in the investment category. Fitch added that, when it revised the outlook to negative from stable in June last year, it cited the risks to growth potential without faster structural reform.

However, praising policy announcements by the government, it said that public commitments and policy announcements by the Indian government so far in 2013 are encouraging signals that the finance ministry wants to maintain the momentum towards fiscal consolidation and structural reform generated since last summer. Further, it added that policy execution and its impact on trend growth will remain key to our ratings assessment.

The finance ministry has made some progress in capping the FY13 budget at 5.3% of GDP as a small surplus was recorded in December. Till December of 2012-13, the Centre's fiscal deficit touched 78.8% of the budget estimate, which is a marginal improvement from 80.4 percent in corresponding period of last fiscal. However, the government had hiked the fiscal deficit target for the current fiscal year to 5.3 per cent of GDP from 5.1 per cent estimated in Budget.

The S&P CNX Nifty is currently trading at 5,966.15 down by 21.10 points or 0.35% after trading in a range of 5,970.00 and 5,947.90. There were 19 stocks advancing against 31 declines on the index.

The top gainers of the Nifty were Sun Pharma up by 3.88%, Gail up by 1.41%, Tata Power up by 0.85%, Ranbaxy up by 0.81% and ACC up by 0.80%.

On the flip side, Jaiprakash Associates down by 3.08%, BHEL down by 3.06%, BPCL down by 2.18%, Bank of Baroda down by 1.95% and Tata Power down by 1.78% were the major losers on the index.

All the Asian equity indices were trading in the red; Shanghai Composite declined 0.10%, Hang Seng tumbled 1.71%, Jakarta Composite dipped 0.37%, KLSE Composite slipped 0.15%, Nikkei 225 crumbled 1.82%, Straits Times dropped 0.86%, KOSPI Composite contracted 0.64% and Taiwan Weighted was down by 0.46%.