Markets get a flat start after a huge rally in previous session

The domestic equity markets have made a flat but positive start, there were some chances of markets consolidating after a huge rally in the previous session but the local indices are sailing in tandem with the regional peers, most of whom are trading in green, however the US markets closed mixed after the Budget proposal of President Obama. Back home CD, Oil & Gas and PSU sectors have taken the lead while the realty is among the laggards once again; FMCG, IT and Healthcare too are trading marginally soft. The continuous decline in the international crude prices has given a reason to cheer for the PSU oil marketing companies and most of them are trading up by over a percent. However some result announcements after the last session are making their mark on today's trade, RCom which came with a 57% decline in net profit is once again languishing in red, however its EBIDTA has increased while it has performed better sequentially. The other result impact is seen on Unitech, down by about 5 percent after reporting a dismal December quarter numbers, investors don't seem to be convinced with the companies argument that the project execution were delayed because of lack of labour. However there is not good news for the Auto industry as well as a top industry official has said that Indian auto sector may grow to around 14-15 per cent in 2011 from 31 per cent in 2010 due to upward spiral in interest rates amid rising fuel prices and input costs.

The BSE Sensex opened at 18,260.08; about 57.88 points higher compared to its previous closing of 18,202.20, and has touched a high and low of 18,278.62 and 18,191.62 respectively.  The index is currently trading at 18,220.36, up by 18.16 points or 0.10%. There were 16 stocks advancing against 14  declines on the index.

The overall market breadth has made a strong start with 63.85% stocks advancing against 33.21% declines. The broader indices were outperforming the benchmarks; the BSE Mid cap and Small cap indices were up by 0.32% and 0.48% respectively.

In BSE sectoral indices, CD up 0.69%, Oil and Gas up 0.48%, PSU up 0.46%, CG up 0.30% and Bankex up 0.12% were the main gainers in the BSE sectoral space.On the other hand Realty down1.43%, FMCG down 0.26%, Health Care down 0.16%, Metal down 0.09% and Auto down 0.05% were the main losers on the BSE sectoral space.

The top gainers of the BSE Sensex were Tata Power up by1.11%, Maruti Suzuki up by 0.86% and Cipla up 0.80%,Tata Motors up by 6.01% and L&T up 0.71%.

JP Associates down 3.09%, M&M down 2.91%, Hindalco Industries down 2.32% , BHEL down by 1.88% and DLF down 1.46% were top losers on the BSE Sensex.

Meanwhile, the Organization for Economic Development and Co-operation (OECD ) has released its composite leading indicators (CLI) for overall economic activity for its member economies and outreach economies for the month of December which point to a continued recovery in the developed world, but show a slowdown in emerging nations including India and China. 

The CLI for India has continued to go down for sixth consecutive month and remained below the watershed mark of 100 for second consecutive month. In the month of December 2010, India's CLI declined significantly to 99.3 from 99.8 seen in the previous month. A score of above 100 on the CLI means the economy is in expansionary mode. Scores Below the 100 level on the other hand indicate recessionary tendencies.

India's CLI started going down in June 2008 as the global commodity rally impacted the prospects of growth in India. The global financial crisis and following recession further hit the Indian economy and the CLI continued to go down during second half of the 2009 and touched the bottom at 94 in January 2009. However, riding on the fiscal and monetary stimulus, domestic demand started improving in January 2010 and the CLI started showing growth from February onward.

Now, however, as the impact of stimulus is fading, and tightening by the central bank to tackle increasingly sticky inflation continues, the CLI is again down to slightly below the 100 mark. It should though be mentioned that since the CLIs are advance indicators, they, unlike the purchasing managers' indices, do not indicate and actual contraction in output, but only signal that economy was likely to slow down or even contract going forward. 

There was also a slowdown in China, which too has, but for the small uptic in October, continued to slow down for last six months. "New data for China point to a downturn, reversing the tentative signs of regained growth momentum reported in last month's assessment...The CLI for India is also pointing towards a slowdown," said the Paris based multilateral agency while interpreting the latest set of its CLIs released on Monday.

The S&P CNX Nifty opened at 5,467.75; about 12 points higher compared to its previous closing of 5,456, and has touched a high and a low of 5,474.45 and 5,443.85 respectively.  The index is currently trading at 5,453.70, down by 2.30 points or 0.04%. There were 21 stocks advancing against 28 declines and one stock remained unchanged on the index.

The top gainers of the Nifty were BPCL up 1.45%,Tata Power up 1.08%, IDFC up 0.82%, Gail up 0.77% and HCL Tech up 0.74%. The top losers of the index were JP Associates down 3.43%, Reliance Communication down by 2.06%, M&M down 1.99%, Hindalco Industries down 1.98% and Reliance Capital down 1.85%.

Majority of the Asian markets were trading in green; Shanghai composite surged by 18.40 or 0.63%to 2,917.53, Nikkei 225 was up by 19.56 points or 0.18% to 10,745.10,Seoul Composite was up by 3.87 points or 0.19% to 2,018.46 and Taiwan Weighted up by 53.73 or 0.62% to 8,739.20 while Hang Seng was down by 87.49 points or 0.38% to 23,033.57  and Straits Times down by 19.61 points or 0.63% to 3,084.81.

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