Markets remain steady despite the rise in food price inflation

The local equity markets are trading in positive terrain in the late-morning session despite getting disappointing food inflation data. The weekly food price inflation stood at 14.44% during the week-ended December 18, compared to 12.13% in the previous week. At the same time, the regional peers are trading on a mixed note and the Dow future was showing uptick the screen trade. Back home, in the sectoral space of the BSE, Consumer Durables, PSU, IT, Capital Goods and Teck sectors were leading the gainers list, while there were no losers in the BSE sectoral space. The broader indices were hovering around the neutral line in trade. The market breadth on the BSE was extremely positive; the gainers outperformed the losers in a ratio of 1485:1037 while 112 shares were unchanged.

The BSE Sensex increased 82.77 points or 0.41% to 20,105.34. The index touched a high and a low of 20,364.93 and 20,274.12 respectively.

The BSE Mid-cap and Small-cap indices gained 0.34% and 0.40%, respectively.

The main gainers in the BSE sectoral space were Consumer Durables up 089%, PSU up 0.81%, I T up 0.71% , Capital Goods up 0.63% and Teck up 0.51%, while there were no losers in the BSE sectoral space.

The major gainers on the Sensex were Tata Power up 1.62%, Wipro up 1.17%, Tata Motors up 1.15%, HUL up 0.97% and Maruti Suzki up 0.97%.

The major loser on the Sensex were HDFC Bank down  1.12%, Reliance Communication  down 0.76% , ONGC down 0.62% DLF down 0.44%  and Bharti Airtel down 0.44%.

Meanwhile, the notices sent by the Department of Telecommunications (DoT) to new operators for missing rollout obligations seem to have worked quickly. At least three Indian telecommunication companies including Etisalat DB Telecom, Loop Telecom and Unitech Wireless have paid a penalty to the union government for the delayed launch of mobile services compared with laid down rules.

Earlier, the government had issued showcause notices to all the new operators accusing them of failing to meet the roll out obligations. 'Etisalat DB has received communication from the DoT for imposition of liquidated damages towards roll-out obligation for the first year in respect of four telecom circles aggregating to Rs.9.9 crore. Etisalat DB has made payments for Rs.9.9 crore under protest,' the company said in a statement. Similarly, Uninor, a joint venture between India's Unitech and Norway's Telenor, also said that the company has deposited the penalty as claimed by DoT.

Even though companies have paid the penalties, these continue to contend that they had no fault in the matter and delays occurred due to government policies of restricting import of telecom gear and also delayed allocation of spectrum which is crucial for launching the services. All the companies said they paid the fines but under protest. The government and Telecom Regulatory Authority of India (TRAI) however do not agree with companies' argument.

Earlier, a report by the Comptroller and Auditor General (CAG) of the country had raised a storm when it observed that the decision of the telecom ministry to give away the licences in 2008 at 2001 prices had resulted in a loss of up to Rs 1.76 lakh crore (based on 3G auction price). The apex auditor also accused of new operators of hoarding spectrum and not following the rollout requirements as agreed under the license.

As per the norms, mobile operators are required to cover at least 10% of district headquarters in each circle within 12 months of the date of award of the license. The rollout obligations keep increasing over time. However, a number of new telecom operators have not fulfilled rollout obligations for all the circles they won spectrum for. The telecom regulator had even recommended cancelling their licenses though the government responded by saying it would be impractical.

The S&P CNX Nifty was up by 16.60 points or 0.27% to 6,076.95 from its previous closing. The index touched a high and a low of 6087.40 and 6062.35, respectively.

The top gainers on the Nifty were Suzlon up 2.03%,  Tata Power up 1.48%  GAIL up 1.14% , Wipro up 1.13  HUL up 1.43% and Tata Motors up 1%.

The top losers on the Nifty were BPCL down 1.66%, ONGC down 1.25%, HDFC Bank down 1.15% Ranbaxy down 1.11% and Sesa Goa down 0.84%.

The regional peers were trading on a mixed note. Shanghai Composite added 0.48%, Jakarta Composite rose 0.39%, Straits Times increased 0.23% ,Seoul Composite climbed 0.37% and Taiwan Weighted increased 0.47% while Hang Seng shed 0.13% KLSE Composite down 0.11% Nikkei 225 trimmed 1.12%.

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