MARKETS REMAIN ON SIDELINES

Indian stock markets once again snapped the session on a dull note, marginally below the neutral line as investors remained on the sidelines amid absence of major triggers. The session largely remained characterized by choppiness as the aimless indices moved only sideways in a tight band. Unexciting leads from across the globe coupled with crude hovering at elevated levels restricted investors from opening long positions in blue chip stocks. But consistent foreign fund inflow, second consecutive drop in India's weekly food inflation numbers and expectations of upbeat quarterly earnings performances by heavyweights companies in fourth quarter limited the downside risks for the frontline indices. Meanwhile, broader markets once again showcased a boisterous performance by outclassing their larger peers by a big margin as investors carried forward their value hunting in beaten down shares from the midcap and small cap space. The NSE's 50-share broadly followed index Nifty, settled with minor losses below the crucial 5,900 support level while Bombay Stock Exchange's Sensitive Index, or Sensex too slipped below the psychological 19,600 mark. The broader indices continued to hog the limelight as the BSE Midcap Index went home with gains of 0.98% as it moved higher for the 14th successive day while the Smallcap Index surged 1.25% and extended the gaining streak for the seventh consecutive session. On the sectoral front, the Realty pocket grabbed the top gainer's position after amassing 1.12% as majors like Unitech and Indiabulls Real Estate garnered 5.08% and 2.98% respectively. The Capital Goods counter too witnessed buying interests and advanced 0.53% on the back of gains in stocks like Suzlon Energy and L&T which added 1.04% and 0.71%. On the other hand, BSE's IT counter shed 0.71% amid concerns of stronger rupee as it would dampen the earnings of major software exporting companies. IT bellwethers like TCS and Infosys sank 2% and 0.71% respectively. Index heavyweight Reliance Industries too failed to make its presence felt in the session as it slipped by 0.35% by the end of trade. Individually, NTPC which shaved off 3.13% in the session after surging 1.78% on Wednesday, along with nasty cuts in the range of 2% - 3% in shares like Sesa Goa, ONGC and Cairn.

On the global front, majority of Asian equity indices finished the day's trade in the positive terrain with Malaysian benchmark KLSE Composite being the top gainer in the space after rising around half a percent, while most other indices ended on flat to positive note. The European markets began on a flat note with positive bias and the France's CAC, Germany's DAX and Britain's FTSE are currently trading on a mixed note. On the other hand, the screen trading for US index futures indicated that the Dow could open on a quiet note.

Earlier on Dalal Street, the benchmark started the day on an absolutely flat note since leads from the Asian markets were mixed as cautious investors remained on the sidelines seeing the modest rise in overnight Wall Street as concerns over spiraling crude oil prices loomed large. The indices continued to trade on a somber note through the first half but made a desperate attempt to rise above the neutral line in afternoon session tracking the positive opening of the European peers. However, the indices soon drifted into the red zone after touching the highpoint of the day in the mid afternoon session as cautious investors chose to book profits at higher levels. Finally, the bourses failed to keep their head above the water for yet another session and settled with marginal losses below the psychological 5,900 and 19,600 levels. Markets registered tepid volumes of over Rs 0.90 lakh crore compared to Wednesday while the turnover for NSE F&O segment too remained lower at over Rs 0.74 lakh crore. Market breadth remained extremely positive as there were 1912 shares on the gaining side against 1020 shares on the losing side while 100 shares remained unchanged.

Finally, the BSE Sensex declined by 21.02 points or 0.11% to settle at 19,591.18 while the S&P CNX Nifty slipped by 6.05 points or 0.10% to end at 5,885.70.

The BSE Sensex touched a high and a low of 19,665.09 and 19,537.02 respectively. The BSE Mid-cap and Small-cap indices gained by 0.98% and 1.25%, respectively. 

HDFC up 2.31%, Hindalco Industries up 1.79%, Wipro up 1.21%, Bharti Airtel up 0.92% and Tata Power up 0.92% were the major gainers on the Sensex.

On the flip side, NTPC down 2.61%, ONGC down 2.10%, TCS down 2.00%, Maruti Suzuki down 1.20% and Sterlite Industries down 1.16% were the Major losers on the index.

As the global economy continue its recovery, demand for the Indian textile industry is also increasing from the rich world. The impact is clearly visible on the battered apparel sector which is finally beginning to see some strong growth. According to the Apparel Export Promotion Council (AEPC), in the month of February 2011, total apparel exports have increased by 21.5%.

The data compiled by AEPC showed that apparel exports in Feb 2011 stood at Rs 5,284 crore compared with Rs 4,346 crore worth exports seen in the same month of last year. There was an improvement on sequential or month-on-month basis as well with exports in Feb 2010 increasing by 1.6% from exports worth Rs 5,193 crore seen in the previous month.

On a cumulative basis, however, the exports over April-February 2011 period continue to be in the red. India has exported apparels worth Rs 45,081 crore in the first eleven months of the fiscal, down nearly 2.25% as compared with exports worth Rs 46,120 crore in the same period of previous fiscal. The decline mainly represents sharp downturn in apparel exports seen in early months of the fiscal.

In dollar terms, exports have grown by 1.6% on sequential basis and nearly 24% on annual basis to touch $1,163 million in Feb 2011.  On cumulative basis, exports in Apr-Feb 2011 stood at $9,883 million, recording a positive growth of 2.04% compared with same period of last fiscal. Better growth performance in dollar terms is mainly because of appreciation in Indian currency over the period under review. However, AEPC point out that since costs of Indian shippers are denominated in rupees, it is the returns in local currency that finally matter to them.

Textile exports had witnessed very strong growth in the three fiscals preceding the global economic crisis (FY05-FY08), but the growth slowed down sharply in FY09 as the industry struggled with surging commodity prices in the first half of the fiscal and global economic crisis in the second half. Things remained poor in FY10 as well and a string recovery started gathering momentum by middle of the last fiscal only on gradual improvement in demand from key export destinations including Europe and US. Most analysts though believe now that if there are no negative surprises on global economy front apparel exports will continue exhibiting a positive trend going forward.

Realty up 1.12%, Capital Goods up 0.53%, Health Care up 0.42%, Bankex up 0.25%, and Metal up 0.14% were the major gainers in the BSE sectoral space. IT down 0.71%, Oil & Gas down 0.49%, TECk down 0.42% and PSU down 0.31% and Consumer Durables (CD) down 0.20 were the major losers in the BSE sectoral space.

The S&P CNX Nifty touched a high and a low of 5,906.10 and 5,866.25 respectively.

The top gainers on the Nifty were HDFC up 2.44%, BPCL up 1.82%, Hindalco up 1.55%, Wipro up 1.51% and HCL Tech up 1.47%.

The top losers on the index were NTPC down 3.13%, Sesa Goa down 3.09%, ONGC down 2.16%, Cairn down 1.93% and TCS down 1.89%.

India's telecom industry continues to add subscriber numbers at a scorching pace notwithstanding the ongoing controversies relating to 2G spectrum issue. According to the latest data released by the telecom regulatory authority of India (TRAI), the industry added 20.2 million new subscribers in February. 

Total mobile subscriber base increased to 791.38 million at the end of February from 771.18 million in the preceding month, said the TRAI in a press release on Wednesday. On a month on month basis, the growth rate of subscribers stood at 2.62%, which also means that India continues to remain the fastest growing market for wireless telecom business.

Looking at the cross section trends, the growth in the wireless category was led by Vodafone which added 3.5 million users, taking its total subscriber base to 130.92 million by end of February 2011. Reliance Communications followed closely and added 3.3 million customers taking its total subscriber base to 132.18 million. Market leader Bharti Airtel also added 3.2 million new subscribers, taking its user base to 158.99 million.

Among the rest, Idea Cellular and Aircel added 2.5 million and 1.66 million users respectively. The total subscriber base of two companies now stands at 86.80 million 53.60 million respectively. Tata Teleservices added 1.6 million users in the month under review taking its total subscriber base to 87.65million. State-controlled BSNL and MTNL respectively added 1.4 million and 22,532 new subscribers in February.

Wireline category however continued to see a negative growth with its total subscriber base declining to 34.87 million at the end of February from 34.94 million in the previous month. Total telephone subscriber number (wireless and wireline) as a result reached 826.25 million. With the latest addition, the overall tele-density or number of telephones subscribers per 100 people in the country increased to 69.29%.

European markets were trading in red on Wednesday. France's CAC 40 slipped by 0.05%, Germany's DAX was down by 0.25% and Britain's FTSE 100 declined by 0.21%.

Most of the Asian equity indices finished the day's trade in the positive terrain on Thursday. Chinese main stock index closed nearly five-month high, supported by strength in cement companies shares on expectations of strong earnings in the first quarter while, Japanese Nikkei pared most of its early gains and ended on a flat note as yen climbed for the first time in 11 days versus the dollar after Bank of Japan cut its assessment of the economy following the nation's record earthquake and before the European Central Bank decides on interest rates today. Moreover, Korean stocks ended lower Thursday after technology major Samsung Electronics Co. provided weak earnings guidance.

MARKETS TRADE IN A NARROW RANGE

The Indian equity markets continue to trade in a narrow range band with negative bias in late morning session due to lack of buying and sustained profit booking from investors. The other Asian markets were trading in mixed and US index futures were in red terrain, the global markets were trading subdued ahead of Bank of England and European Central Bank policy rate announcement. These negative cues has also dampened sentiments back home where in sectoral space, Realty , Capital Goods (CG) , Health Care (HC) Metal and Consumer Durables (CD) counters were showing some buying interest while Information Technology (IT), TECk , Auto , Oil & Gas and Bankex  shares were witnessing profit booking  . However, the broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices gained 0.88% and 1.07% respectively.  The overall market breadth on BSE was in the favour of advances which outnumbered declines in the ratio of 1701:896, while, 85 shares remained unchanged.

The BSE Sensex declined 44.87 points or 0.23% at 19567.33. The index touched a high of 19,620.88 and a low of 19,537.02.

The BSE Mid cap and Small cap indices gained 0.88% and 1.07% respectively. 

The top gaining sectoral indices on the BSE were, Realty up by 1.91%, Capital Goods (CG) up by 0.72%, Health Care (HC) up by 0.46%, Metal up 0.34% and Consumer Durables (CD) up by 0.30%. On the other hand, Information Technology (IT) down by 0.94%, TECk down by 0.78%, Auto down by 0.38%, Oil & Gas down 0.15% and Bankex down 0.10% were the only losers on the index.

The top gainers on the Sensex were Hindalco up by 1.74%, HDFC up by 0.97%, Tata Power up by 0.88%, DLF up 0.85% and L&T up by 0.57%.

On the flip side, TCS down by 2%, NTPC down by 1.78%, HDFC Bank down 1.30% Maruti Suzuki down by 1.16% and Bharti Airtel down by 1.08% were the top losers on the index.

Global rating agency Standard & Poor's (S&P) on Wednesday cautioned that high and sticky inflation if not brought down could derail India's growth story. The agency however maintained stable outlook for India's long term sovereign rating in light of strong external position and good investment climate in the country.

"We affirmed the 'BBB-' long-term and 'A-3' short-term sovereign credit ratings on India. The stable outlook reflects our view that India's external flexibility and fiscal performance will temper the effects of inflation and political uncertainty," said the rating agency in a Press Release. "The ratings on India reflect the country's good economic growth prospects and its fairly strong external position," it added.

It however cautioned that the ongoing high inflation was a risk to long term growth sustainability. 'High inflation could derail India's stable macroeconomic and interest rate environment. An average increase of more than 17% in the prices of primary articles in 2010, including food items, indicated that price stability in India remains vulnerable to international commodity prices and the monsoon,' said the S&P.

The agency believes that India's fiscal consolidation will continue in coming years but the weak fiscal position at the moment did remain a drag on country's economic strength. "...the country's weak fiscal profile and structural problems temper its strengths. Structural problems not only constrain efficiency but also preclude a large share of the population from benefiting from the country's rising prosperity," it noted.

On the growth front, it expects continued strong performance. It expects the GDP for the current financial year to expand by 8.3% on annual basis guided by good overall investment atmosphere. Further, strong international reserves also support India's external position and the agency expected reserves to reach $377 billion at the end of March 2012, or 207% of India's short-term external debt. The strong commitment of the central and state governments to the medium-term fiscal consolidation plan set out by the 13th Finance Commission also helps improve outlook on the fiscal front.

Currently the sovereign rating of India by S&P is lowest in the investment grade with a stable outlook.  However, it feels that ratings could be raised if the Indian government is able to significantly reduce general government deficits. The government could undertake several measures to reduce deficits, such as initiatives to lower and promote more efficient use of the subsidies on fuel, fertilizer, and food. These initiatives could improve the expenditure structure of the budget and reduce the negative influence of potential external shocks on India's fiscal position, said the S&P. 

The S&P CNX Nifty shed 15 points or 0.25% at 5,876.75.The index has touched a high of 5,889.80 and a low of 5,866.25 respectively.

The top gainers of the Nifty were BPCL up by 1.95%, Hindalco up by 1.88%, Tata Power up by 1.22%,  Ambuja Cements up by  0.96% and DLF up by 0.89%.

NTPC was down by 2.14%, Sesa Goa down by 2%, TCS down 1.94%, Maruti Suzuki down by 1.43% and Tata Motors down 1.22% were the major losers on the index.

The  other Asian markets were trading mixed bias; Shanghai Composite gained 0.12%, KLSE Composite gained 0.27%, Nikkei 225 rose 0.07% and Taiwan Weighted surged 0.23% while  Jakarta Composite added 0.20%,Hang Seng declined 0.16%, Straits Times shed 0.08% and Seoul Composite trimmed  0.21%.

TOP PICKS FOR 7th APRIL

Markets appear to be loosing it's steam as the RSI has turned negative, though they are still above 5 & 10EMA, which is a positive indication, Thus it may be called a no trade zone, as the NIFTY is likely to consolidate in between 5850 - 5950. At least on my radar there appears to be very less stocks to trade in for an upward move. Long positions can be taken in JETAIRWAYS for a target of 541, NDTV for a target of 88, SASKEN for a target of 175, STAR for a target of 450, WOCKPHARMA for a target of 393.
                               HAPPY INVESTING.............CHEERS !!!

MODERATE LOSSES

Indian frontline indices continued to trade on an unexciting note for yet another session, registering moderate losses as investors appeared reluctant to pile up positions in large cap stocks and instead, chose to square off positions at every rise. Spike in crude oil prices which climbed around a quarter percent by the close of trade continued to remain a cause of concern for the local markets as traders expected that RBI may further take measures to stem the mounting inflationary pressure by hiking interest rates if crude prices continue to remain at elevated levels. However, the downside risks remained capped as FII's continued to pour in funds on expectations that most of the headwinds have already been factored in by the markets and that the companies will report strong quarterly earnings for the fourth quarter. Meanwhile, broader markets staged yet another resilient performance as they outclassed their larger peers for the fourth straight day after investors showed huge buying interests in undervalued shares from the midcap and small cap space. The NSE's 50-share broadly followed index Nifty, settled with moderate losses just below the crucial 5,900 support level while Bombay Stock Exchange's Sensitive Index, or Sensex finished a tad above the psychological 19,600 mark. In the broader markets, the BSE's Midcap and Smallcap indices went home with gains of 0.47% and 0.78% respectively, outshining the large caps by quite a margin. On the sectoral front, the Realty pocket grabbed the top gainer's position after amassing 3.18% as majors like Unitech and HDIL which respectively garnered 6.35% and 8.33%, lending some support. The Consumer Durables counter too remained amid the thick of things and advanced 1.11% on the back of surge in stocks like Rajesh Exports and Whirlpool which zoomed 5.69% and 2.02%. The downside risks for the local markets also got capped because of 1.78% surge in NTPC as it reported provisional net profit growth of 24% to Rs 25.05 billion for the quarter ended March while provisional sales for last quarter of the fiscal year was Rs 144.9 billion, up 17.8% from a year earlier. But a decline of around 1% in BSE's Teck counter restricted the bourses from bouncing back into the green. Teck majors like Idea Cellular and Wipro plummeted 5.05% and 2.93% respectively. Index heavyweight Reliance Industries too failed to make its presence felt in the session as it slipped marginally below the neutral line by the end of trade.

On the global front, Asian equity indices finished the day's trade in the mixed terrain. The benchmarks in Shanghai soared over a percent as investors shrugged off the 25 bps hike in key bank reserve rates by China, which raised rates for the fourth time since October in a bid to curb inflationary pressure on the economy. The European markets began on a flat note with positive bias and the France's CAC, Germany's DAX and Britain's FTSE are currently trading with moderate gains. On the other hand, the screen trading for US index futures indicated that the Dow could open in the green zone.

Earlier on Dalal Street, the benchmark started the day on an absolutely flat note since leads from the Asian markets were mixed as investors remained cautious on the back of unenthusiastic closing in overnight Wall Street, where Fed officials raised concerns that higher energy prices could weaken the economy. The indices after trading above neutral line for around an hour drifted in to the red and soon got dragged to intraday low levels. Thereafter the indices managed to bounce back into the green terrain for a brief period in the early noon session as hefty buying was witnessed in Realty and Consumer Durable stocks. However, the bourses failed to keep their head above the water for a long time and immediately slipped back into the red only to keep gyrating in a narrow band through the end of trade. Eventually the frontline indices consolidated their positions for yet another day and settled around with moderate losses below psychological levels. Markets registered higher volumes of over Rs 1.22 lakh crore compared to Tuesday while the turnover for NSE F&O segment was at over Rs 1.03 lakh crore. Market breadth remained extremely positive as there were 1765 shares on the gaining side against 1165 shares on the losing side while 111 shares remained unchanged.

Finally, the BSE Sensex declined by 74.62 points or 0.38% to settle at 19,612.20 while the S&P CNX Nifty slips by 18.30 points or 0.31% to end at 5,891.75.

The BSE Sensex touched a high and a low of 19,811.14 and 19,550.55 respectively. The BSE Mid-cap and Small-cap indices gained by 0.47% and 0.78%, respectively. 

Hero Honda up 2.22%, NTPC up 1.78%, Reliance Infrastructure up 1.21%, Tata Motors up 1.19% and ONGC up 0.68% were the major gainers on the Sensex.

On the flip side, Wipro down 2.93%, Bharti Airtel down 1.86%, Hindalco Industries down 1.67%, Maruti Suzuki down 1.40% and TCS down 1.25% were the Major losers on the index.

Worried over rising cost of funding amidst continued tightening of monetary policy stance by the Reserve Bank of India (RBI) and its impact on credit off-take, bankers on Tuesday urged the central bank to take a pause in its tightening cycle. They also asked for a cut in reserve rations to improve the liquidity conditions in the system.

In the run up to annual monetary policy released for fiscal year 2011-12, top bankers met the Governor of the RBI D Subbaro on Tuesday. There was a near consensus among bankers that further substantial tightening in monetary policy stance will force them to pass on increase in cost of funding to borrowers in a significant way that could have a negative bearing on the overall credit demand.  They however did not seem averse to the idea of milder tightening of say 25 basis points over first half of FY12.

Bankers also wanted the Reserve Bank to cut either the cash reserve ratio (CRR) or the statutory liquidity ratio (SLR) that can help bring more liquidity into the system. "Bankers have made a very clear representation that CRR, SLR must come down. We requested RBI to slash the CRR as well as the SLR or at least one of these even though we admit that inflation is a big concern. We see inflation at 7% by the end of the financial year," said K Ramakrishnan, chief executive of Indian Banks Association (IBA).

The RBI has in last financial year ending March 31, 2011 hiked its key policy rates including the repo rate or the rate at which it lends to banks and reverse repo, the rate at which it allows banks to park their surplus liquidity with it eight times. However, since the liquidity has been tight in the system, the CRR was left unchanged for most part of the fiscal while SLR was temporarily cut to ease liquidity.

Nonetheless, with the liquidity situation easing and expected to ease further as government spending picks up, the central bank is unlikely to cut the CRR or SLR. If anything, the RBI might hike CRR going deep into FY12 in case liquidity turns too much positive. On the issue of tightening in policy rates as well the central bank is expected to raise repo and reverse repo rates by 50-75 bps at least during the calendar year 2011 as inflation remains at elevated levels.

Bankers also requested the RBI to give them more time for restructure loans given to microfinance institutions (MFIs). The central bank had earlier given time till March 31, 2011 to banks to restructure such loans but banks have now asked for an extension of one quarter that is likely to be granted. The restructuring of MFI loans became a major issue following the Andhra government's ordinance that restricted the business of MFIs and impacted the loan repayment capability temporarily. The central bank on the other hand raised concerns about sharp increase in banks' lending to the real estate sector that it contends can lead to an asset bubble in the economy.

Realty up 3.18%, Consumer Durables (CD) up 1.11%, Power up 0.73%, PSU up 0.56%, and Auto up 0.26% were the major gainers in the BSE sectoral space.TECk down 0.84%, IT down 0.69%, Bankex down 0.43% and Metal down 0.41% and Capital Goods (CG) down 0.11were the major losers in the BSE sectoral space.

The S&P CNX Nifty touched a high and a low of 5,944.45and 5,868.80 respectively.

The top gainers on the Nifty were Sesa Goa up 3.27%, GAIL up 2.64%, Hero Honda up 2.36%, NTPC up 1.75% and RPower up 1.68%.

The top losers on the index were Cairn down 4.45%, Wipro down 3.34%, TCS down 2.07%, SAIL down 1.99% and Bharti Airtel down 1.49%.

India's power sector has seen an addition of a record 15,795 megawatt of generation capacity in the financial year 2010-11, the highest in any one year so far. The country though still continues to face significant shortage in supply-demand of power bridging the same and would require further pick up in pace of capacity addition.

Union Power Minister Sushil Kumar Shinde said on Tuesday that while 12,160 MW of the capacity added in FY11 had already been commissioned, the remainder would start producing power in the next two to six weeks. Expressing satisfaction over performance in terms of capacity addition he added that capacity will have to be added at a faster pace in future. In the fiscal 2009-10, only 9,585 MW of capacity was added.

In the current financial year, the power ministry plans to add more than 28,000 MW of electricity generation capacity. "Over 28,000 MW of power projects are under construction and would be commissioned by March, 2012," Shinde said, adding that the capacity addition would be from all sources of energy - coal, hydro, gas, etc. The highest contribution of 75% would come from coal fired projects while hydro and gas based projects would together contribute the remaining 25%.

In the ongoing Five Year Plan ending March 2012, the power ministry has so far been able to add 34,462 MW. The target for the capacity addition during the Plan was initially set at 78,000 MW but was later lowered by the Planning Commission to 62,000 MW in view of slow speed of commissioning of projects. However, even to achieve the downwardly revised target, the country will need to add at least 28,000 MW in 2011-12, nearly double the record capacity addition seen in last fiscal.

India faces a demand-supply gap of close to 14% in power and has repeatedly missed power generation capacity addition targets in various five year plans. While the pace has improved somewhat with the private sector participation in recent years, coal linkage has now emerged as one of the most crucial reason for delays in implementation of power projects. Another issue causing delay is lesser supply of capital equipment for power plants. The power ministry will have to solve the problems on a priority basis if it hopes to reach anywhere close to the 28,000 MW capacity additions it is talking about.

European markets were trading in green on Wednesday. France's CAC 40 gained 0.21%, Germany's DAX was up by 0.71% and Britain's FTSE 100 increased by 0.56%.

Most of the Asian equity indices finished the day's trade in the positive terrain on Wednesday, led by Chinese Shanghai Composite, which surged more than one percent in the trade today and breached its crucial 3,000 point mark as investors shrugged off fourth interest rate hike since October. The People's Bank of China on Tuesday raised interest rates by 25 basis points. However Japanese Nikkei edged lower on Wednesday on increasing worries over mounting production losses for quake-hit manufacturers and Seoul shares too declined in today's trade, led by falls in technology and banking stocks, which include Samsung Electronics Company.

NEGATIVE TERRITORY

The benchmark equity indices continue to trade in negative territory in late morning session due to profit booking from funds ahead of corporate results along with worries over inflation. The increase in crude oil prices too continues to be a cause for concern for domestic economy; Brent crude saw a high of $ 122.89/barrel on Tuesday on news of delays in Forty crude cargoes. It was still trading at $121.8 a barrel in early trade today. Meanwhile, the other Asian markets were trading mixed and US index futures were trading flat with modest gains, central banks in the US and Europe are now contemplating an exit from stimulus. Back home, NSE Nifty and BSE Sensex were trading below their psychological level of 5,900 and 19,700 respectively. The BSE sectoral indices were trading mixed Realty, Consumer Durables (CD) , Power , Auto and Metal  counters were witnessing  some buying  from investors  while, FMCG ,TECk , IT, Banking shares saw profit booking. While the broader indices continue to outperform; the BSE Mid cap and Small cap indices surged 0.49% and 0.68% respectively. The overall market breadth remains in the favour of advances which has outnumbered declines in the ratio of 1492:1064, while, 86 shares remained unchanged

The BSE Sensex declined 47.30 points or 0.24% at 19639.52. The index has touched a high of 19,811.14 and a low of 19,550.55 respectively.

The BSE Mid cap and Small cap indices surged 0.49% and 0.68% respectively. 

The top gaining sectoral indices on the BSE were, Realty up 1.65%, Consumer Durables (CD) up 1.02%, Power up 0.44%, Auto up by 0.75% and Metal up 0.30%. While, FMCG down 0.64%,TECk down 0.17%, IT down 0.41% and Bankex down 0.30% were the only losers on the index.

The top gainers on the Sensex were Reliance Infra up 2.46%, Hero honda up 0.84%, Tata Power up 0.73%, Sterlite Inds up 0.70% and Tata Motots up 0.64%.

Wipro down 1.70%,ITC down 1.30%,Bharti Airtel down 1.29% and Reliance Communication  down by 1.11%  and HDFC Bank down  1.07% were the major losers on the index.

In a significant positive development for miners, the Indian Supreme Court (SC) on Tuesday lifted the ban on export of iron ore imposed by the government of Karnataka state. The state accounts for nearly a quarter of India's iron ore exports but had banned shipments of iron ore from its 10 ports and stopped its transport to other states for exports in July last year.

The relief however, is not permanent for now. The court said its order that lifted the ban from 20 April was an interim one and listed the case for further hearing in the first week of May. Meanwhile the Karnataka government has been given two weeks to implement some new mechanism to prevent illegal mining while allowing legitimate exporters to continue shipping the commodity out of the country.

The ban was imposed by the state due to widespread illegal mining of the crucial raw material. However, after the mining companies in Karnataka state moved the Karnataka high court and later to the Supreme Court challenging the constitutional validity of the government's move last year, the SC directed Karnataka government to put in place an alternative mechanism to prevent illegal mining.

However, traders are saying that iron ore prices in the country have not reacted much immediately as the market would wait for more clarity on the case. Also, the demand from China is not clear yet and it is going to be a 'wait and watch' policy for exporters for some time. One thing that the stay order does accomplish is preventing further slump in prices by preventing the steel companies to act as monopolist (monopolist buyer) for iron ore shippers.

Iron ore prices have come down significantly in recent weeks in China, biggest buyer of Indian iron ore, following apprehension of slowdown in demand because of the double natural calamity in Japan and the following nuclear crisis that is still continuing. Japan is second largest steel maker in world after China and decline in production there can have substantial impact on demand and hence prices of iron ore. Declining prices in China, coupled with the four fold increase in export duty on iron ore fines implemented in FY12 Budget by Indian government have been bringing iron ore prices down. The latest stay order by SC however is now expected to halt the declining trend in iron ore prices.

The S&P CNX Nifty trimmed 18.55 points or 0.31% at 5,891.50 .The index has touched a high of 5,944.45 and a low of 5,868.80 respectively.

The top gainers of the Nifty were Sesa Goa up by 3.42%, BPCL up by 2.75%, Reliance Infra up by 2.19%, GAIL up 1.53% and IDFC up by 1.35%.

The top losers of the index were Wipro down 1.88%, Bharti Airtel down 1.43%, Ambuja Cements down 1.35%, Reliance Communication down 1.25% and ITC down 1.22%.

The other Asian markets were trading mixed; Shanghai Composite gained 1.20%, Hang Seng added 0.59%, Jakarta Composite rose 0.26%, Straits Times advanced  0.27%, and Taiwan Weighted surged 1.69%. On the other hand, KLSE Composite trimmed 0.10%, Nikkei 225 decreased 0.32% and Seoul Composite shed by 0.171%.

GLOBAL MARKET UPDATE 6/4

• US ISM non-manufacturing index slipped to 57.3 in March from 59.7 in February, below market consensus of 59.5, led by declines in production and employment indices.

 

• Australia’s central bank left its benchmark interest rate at 4.75 % for a fourth straight meeting, as floods disrupt coal mining in the nation’s northeast and a rising currency tempers inflation.

 

• China raised interest rates for the fourth time (benchmark 1-year lending rate was increased to 6.31% from 6.06%) since the end of the global financial crisis to restrain inflation and limit the risk of asset bubbles in the economy.

 

• Moody’s Investors Service cut Portugal’s credit rating yesterday for the second time in three weeks amid expectations that the country will be unable to avert a European bailout. It downgraded the long-term government bond ratings by one level to Baa1 from A3, and said it’s considering another reduction.

 

• The minutes of the March FOMC meeting suggest that participants saw macro data as consistent with a recovery that was gaining traction and ongoing gradual improvement in labor market. As expected, Committee members felt that rapidly rising commodity prices posed upside risks to stability of longer-term inflation expectations and outlook. Policy makers however differed over whether to begin removing record stimulus this year as they debated the path of monetary policy after the completion of their USD 600 bn bond-purchase program.

 

• Indian stock markets ended the day on a flat note yesterday. Profit booking in the morning session saw the benchmark indices slip into the negative territory after touching a near 3-month high on Monday. Mixed cues from the Asian peers also failed to provide significant cues to the Indian markets. However, strong FII inflows helped the indices recover intraday losses in subsequent trade.

 

• Overnight, the US stocks ended flat as the technology sector lost steam despite earlier gains driven by M&A activity. The Dow fell for the first time in three days.

 

• Today, Asian markets were mixed tracking subdued cues from the US markets & China's latest rate increase on Tuesday dampened sentiment. Stocks fluctuated as Chinese banks & insurance companies advanced. Exporters dropped amid concern the Federal Reserve will withdraw stimulus measures. Today, Indian equity benchmarks were positive with moderate gains in opening trade & rose 0.2% despite rising crude oil prices on Middle East tensions. Stocks slipped later on lack of clues from Asian markets. Buying was seen in metal, Auto, cement, telecom, ADAG, power & select financial companies' shares.

 

TOP PICKS FOR 6th APRIL

The markets are in positive zone & are in a consolidation mode, the front liners have already run up & now thr broader market is catching up, thus we can observe movements in mid caps & small caps. The NIFTY is likely to make a dash for 5944 & on the downside may slip to 5845. Long positions can be taken in PRAJIND for a target of 88, STER for a target of 195, TECHM for a target of 760, KLGSYSTEL for a target of 77, OFSS for a target of 2187.
                                                               HAPPY INVESTING.........CHEERS !!!