Indian equity markets are trading upbeat extending their gains in mid morning session. Though the market has made a small bounce back, but the recovery has bought some cheer in the Indian equity markets as the domestic shares were hammered cruelly in past consecutive five sessions. On the global front, cues are just not conclusive as the regional counterparts are trading mixed, while, the US futures were trading in positive terrain. Back home, both barometer indices have gained some more ground on emergence of buying by funds and retail investors at prevailing lower levels, however, fears of hike in interest rates are limiting the gains and are preventing the benchmarks indices to regain their physiological level of 19500 mark(Sensex) and 6000 mark (Nifty ) respectively. On the BSE sectoral front, stocks from Realty, Information Technology, TECk counters are still facing the selling pressure, while, stocks from Bankex, Metal and Oil & Gas space are helping the benchmarks indices to climb up. Banking sector has gained substantial traction after declining over 3% yesterday. Lower buying has clearly emerged as the broader indices too have gained some strength. The overall market breadth for a change has remained in the favour of advances which are currently outperforming declines in the ratio of 1316:1096, while, 92 shares remained unchanged.
The BSE Sensex is currently trading at 19,406.39, up by 182.27 points or 0.95%. There were 25 stocks advancing against 5 declines on the index.
The broader indices too have gained some traction; the BSE Mid cap and Small cap indices were up by 0.30% and 0.39 % respectively.
The top gaining sectoral indices on the BSE were, Bankex up by 1.62%, Oil & Gas up by 1.28%, Public Sector Undertaking up by 1.22%, Metal up by 1.19% and Healthcare up by 1.01%, while Realty down by 0.80%, Information Technology down by 0.36 % and TECk down by 0.08%, were the only losers on the index.
The top gainers on the Sensex were Hindalco Industries up by 3.12%, Bajaj Auto up by 2.98 %, Reliance Communication up by 2.59%, SBI up by 2.07% and ONGC up by 2.02% .
Maruti Suzuki down by 0.87%, TCS down by 0.83%, DLF down by 0.81%, Infosys down by 0.61% and ITC down by 0.32% were the top losers on the index.
Meanwhile, worried over the sudden reversal in downward trajectory of inflation, particularly the surge in food inflation seen over last one month or so, Prime Minister Manmohan Singh has called a meeting of concerned Cabinet colleagues including food and agriculture minister Sharad Pawar and finance minister Pranab Mukherjee to deliberate on the matter.
Chairman of Prime Minister's Economic Advisory Council (PMEAC) C Rangarjan, Planning Commission deputy chairman Montek Singh Ahluwalia and the finance ministry's chief economic advisor Kaushik Basu will also participate in the meet scheduled on Tuesday to discuss ways to tackle spiralling food inflation that has defied the historic trend where food prices used to decline significantly over the Nov-Feb period.
Various government officials have been expressing difficulty in checking food prices which continue to remain stubbornly high. "Vegetable prices are high and on that we do not have any control... as the supply improved with fresh arrivals, prices will come down," Pawar had said recently commenting on the sudden spike in food prices in December. Similarly, Basu too had stated that it was not possible to have complete control on prices and what the government could do was to work towards increasing supply.
Economists feel that with the high fiscal deficit that the government is running and increasing expenditure in social sector schemes like national rural employment guarantee scheme, greater amount of purchasing power was going into hands of people, particularly in the lower income group, which has high propensity to consume. This was bound to push demand for food commodities and the government should have managed the supply side more pro-actively. Until the supply side is managed well, there is little scope to bring down food prices.
The S&P CNX is currently trading at 5,803.30, up by 40.45 points or 0.70%. There were 40 stocks advancing against 10 declines on the index.
The top gainers of the Nifty were HCL Technology up by 4.35%, Hindalco up by 3.60%, Bajaj Auto up by 3.00%, Sesa Goa up by 2.29% and Reliance Communication up by 2.26%.
The top losers of the index were SAIL down by 2.20%, TCS down by 1.37%, DLF down by 0.81%, Maruti Suzuki and BPCL were down by 0.75% each.
Asian equity indices were trading on a mixed note; Hang Seng was up by 0.97%, Jakarta Composite up by 0.29%, Straits Times was up by 0.26% and Taiwan Weighted was up by 1.11%.
On the flip side, Seoul Composite was down by 0.01%, Nikkei 225 slid 0.15% and KLSE Composite declined 0.19%.
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