Benchmarks indices shed some gains; Capital Goods lose momentum

The local share market which kicked off the first trading day of the year 2011 on the upbeat note, have now shed some gains.Though the benchmarks have came off from their day's high but still the gains that they have clocked till now are noteworthy. The key benchmarks indices tracking mostly firm Asian peers and US futures indices are seen flirting with the 20600 level (Sensex) and 6180 mark (Nifty) respectively. The benchmarks apart from the global indices are also getting support from automobile companies, which have reported decent rise in December sales. The names that have hogged the limelight so far are Tata Motors after announcing a 31% rise in its total vehicle sales, with Nano sales too picking up. While, top utility vehicles maker Mahindra & Mahindra logged a 42 percent rise in sales last month. On the BSE sectoral front, all sectors are trading in triumphant mood, barring Capital foods sector which has now bowed down to some selling pressure. However, emerging victorious among them are stocks from Metal, Auto and Realty Sector. The broader indices too at this time are garnering strength and are ruling up by 0.91% (Midcap index) and 1.32% (Small cap Index). It's clear that the Small pocket index is outperforming their larger peers. Meanwhile, the markets are also getting some confidence with Finance Minister Pranab Mukherjee's statement that Centre is hopeful that food inflation will come down to 6.5% by March. The market breadth on the BSE is supporting the advances which have clearly outperformed the declines in the ratio of 2012:524, while, 65 shares remain unchanged.

The BSE Sensex is currently trading at 20,587.36, up by 78.27 points or 0.38%. There were 23  stocks advancing against just 7 declines on the index.

The broader indices were performing in line with benchmarks; the BSE Mid cap and Small cap indices surged 0.91% and 1.32 % respectively. 

The top gaining sectoral indices on the BSE were, Metal up by 1.61 %, Realty up by 0.91%, Consumer Durables  was up by 0.88%, Auto up by 0.78%,  and Bankex up by 0.56 %  While, Capirtal goods down by 0.06% was the lone looser on the index.

SHARIAH 50 index which opened at its day's low of 1,253.54 is now up by 5.39 points or 0.43% from its previous close of 1,249.69.It touched a high of 1,258.88 and a low of 1,253.54.

The top gainers on the Sensex were Sterlite Industries up by 2.47%, M&M up by 2.13%,Tata Steel up by 1.92%,DLF up by 1.73% and Reliance Communication up by 1.65%.

On the other side, NTPC down by 1.12%,Bharti Airtel down by 0.49 % and BHEL down by 0.39 %, Cipla down by 0.38% and L&T up by 0.35% were the losers on the index.

Defying the usual trend of poor performance in the last month of a year, major auto makers have posted a robust growth in their sales in December 2010. Historically the sales are lower in December as customers like to postpone the purchase by a month in order to get a newer model. This in turn helps in terms of a higher resale value. However, a host of new models, discounts and expectations of rise in prices in the New Year have ensured this time that sales remained robust in December as well.

While some of major players like Maruti Suzuki are yet to release their December sales figures, numbers released by other market participants suggest that overall growth will be close to 20% in December as well. Hyundai Motor India, the country's second-largest car manufacturer, sold 26,168 units in month under review, a 17.6% growth over 22,252 units sold in December 2009. According to the company, its new products like the Santa Fe as well as upgrades such as the i10 have been very well received and boosted sales.

Homegrown Tata Motors' also saw a very good month with its passenger vehicles sales in December 2010 rising 34.48% to 19,706 units. The company sold 5,784 units of the world's smallest car Nano, which is up 60% on annual basis. Another locally headquartered auto maker Mahindra & Mahindra reported a 41.92% jump in its sales at 34,062 units in December 2010, over the same period previous year.

In the two wheeler space, Hero Honda Motors, India's largest motorcycle maker, said its sales in December jumped a third and helped the company to close 2010 with a record sales of more than 5 million units. TVS Motor also reported a very strong 41% jump by selling 1,68,359 units in December 2010 as against 1,19,701 units in the same period of the previous year. Honda Motorcycle & Scooter India (HMSI) posted 20% growth in sales at 1,40,642 units in December 2010, over the same month previous year. Another two-wheeler maker, Yamaha Motor, reported a 69.71% increase in its total sales in December 2010 at 34,839 units.

Going forward, car companies expect robust demand to continue and market to expand further in 2011. Although the higher base of this year could moderate the year-on-year growth in 2011 to some extent, overall performance is likely to remain robust. Analysts feel that per-capita income in India is reaching the threshold where auto sales usually begin growth at a much faster pace and in that sense the year 2010 could prove to be an inflexion point for the auto sales in country.

The S&P CNX Nifty is currently trading at 6,158.65, higher by 24.15 points or 0.39 %. There were 41 stocks advancing against just 8 declines on the index.

The top gainers of the Nifty were Sterlite Industries up by 2.52 %,Sesa Goa up by 2.19%, M&M up by 1.90%,  SAIL up by 1.84%, and DLF up by 1.83%.

The losers of the index were NTPC down by 0.90%,Bharti Airtel down by 0.70%, Ciapl down by 0.43%,Axis Bank down by 0.38% and  BHEL was down by 0.33%.

All Asian equity indices were trading in the green; Hang Seng surged by 1.38%, Jakarta Composite was up 0.76%, KLSE Composite inched up by 0.76%, Straits Times soared 1.18%, Seoul Composite rose 0.62% and Taiwan Weighted was up by 0.52%. While, stock markets in Japan, mainland China, Australia and New Zealand remained closed on Monday on account of New Year's holiday. 

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