Indian equity market shrugs off initial gains; Sensex dips 70 points

Indian equity markets  shrugging off the petite signs of recovery have dipped into red again in the mid morning session as investors bracing a sharp slowdown in factory output and outflow of foreign funds amidst spate of corruption scandals and weak trend regional peers preferred staying on the sidelines of the volatile equity markets. On the global front, after the flat close of the Wall Street, it was the fall of the Asian shares which weighed on the local investor's sentiment. Asian shares dipped low as investors shunned risk on concerns about the pace of policy tightening within the region and escalating tensions in Egypt. While the US future indices too were struggling to be in green. Back home on the BSE sectoral front, stocks from Metal, Information Technology and Realty counters were scattering the weak spells in the local share market, while stocks from Consumer durables Auto and Bankex were struggling to push the momentum on the positive side. The overall market breadth on BSE was still in the favour of advances which were outnumbering declines in the ratio of 1267:1081, while, 70 shares remained unchanged on the index. Meanwhile, India's industrial production tanked to 1.6% in the month of November, even lower than last month's weak performance of 2.7%. However a lot of base effect is involved in the figure, the figure was somewhat below market expectations.

The BSE Sensex is currently trading at 17,392.66, down by 70.38 points or 0.40%. The index touched a high of 17,526.64 and a low of 17,370.82 respectively. There were only 10 stocks advancing against 20 declines on the index.

The broader indices were afloat in green; the BSE Mid cap and Small cap indices were up by 0.38% and 0.59% respectively.

In BSE sectoral space, Consumer Durables (CD) up 0.41%, Auto up by 0.39%, Bankex up 0.26 %, Health Care up 0.23 %, FMCG up 0.08% and were the main gainers in the BSE sectoral space.

On the other hand, Metal down 1.68%, IT down 1.43%, TECk down 1.38%, Realty down by 1.34%, Oil and Gas down 1.15% were the major losers on the index.

The top losers on the BSE were, Reliance Communication down 5.80%, Hindalco Industries down 3.08%, TCS down 2.84%, ONGC down 2.70% and Tata Steel down 2.37%.

HDFC up by 2.05%, Tata Motors up 1.73%, NTPC up 1.61%, Maruti Suzuki up 1.31 % and ICICI bank up 1.25 were the top gainers on the index.

Meanwhile, amidst severe food inflation shock that the country is facing currently, the Indian Prime Minister Dr Manmohan Singh on Thursday called for modernizing theagricultural marketing system in India and providing greater role to the private players in this context to improve the efficiency of distribution.

'I have asked the Planning Commission and the Ministry of Agriculture to focus particularly on this aspect in the 12th Plan. The modernization of the agricultural marketing implies greater interaction and involvement of the private sector,' said the PM while addressing a conference of International Food and Policy Research Institute, a US based agri centered think-tank.

The PM stated that a rapid growth in gross domestic product (GDP) in general and, even agriculture in particular, though necessary, was not sufficient to produce desirable nutritional and health outcomes among the socially and economically disadvantaged groups of the community. Thus, he suggested, that the need was to channel the benefit of increasing production and rising economic growth to the bottom of the pyramid.

Singh said that while the production of food grains had increased substantially following the green revolution and continues to remain comfortable, this was only one part of the solution. With economic growth and changing dietary habits, demand for fruits and vegetables, milk and milk products, meat and fish, is steadily increasing. While this was entirely natural, the existing setup was insufficient to deal with challenges arising out of changing life style and rising incomes.

The Indian PM emphasized that for sustainable diversification in agricultural, economy would require back up support in terms of viable delivery and marketing chains because much of the agricultural produce was perishable. "Rapid growth in agriculture, particularly that which diversifies the food basket while ensuring adequate availability of energy and other basic nutrients, combined with other activities and initiatives in health, hygiene and women's education will help overcome poor health, hunger and malnutrition," he said. 

The S&P CNX Nifty is currently trading at 5,206.50, down by 19.30 points or 0.37 %.The index touched a high of 5,248.10 and a low of 5,200.35 respectively. There were 16 stocks advancing against 34 declines, while none of the stock remained unchanged on the index.

The top gainers of the Nifty were Cairn up 4.86%, IDFC up 4.13%, HDFC up 2.21%, NTPC up 1.94% and Tata Motors up by 1.76%

The top losers of the index were RCom down 5.75%, BPCL down by 3.59%, Suzlon down 3.50%, Sesa Goa down 3.38%, and Ambuja Cement down 3.28%.

All the Asian markets were trading in the red; Shanghai composite down by 0.22%, Hang Seng was down by 0.28%, Jakarta Composite was down by 0.57%, KLSE Composite down by 0.44%, Straits Times down by 0.92% and Seoul Composite was down by 1.29%.

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