Benchmarks trade firm after a flat start

The Indian equity markets are trading on a firm note after making a flat start tracking positive cues from the global indices. US markets managed to close in all green on Friday, while the Asian markets were trading on a mixed note at this point of time. Back home, sustain buying in about all the heavyweights and broader indices kept the momentum on the positive side and BSE Sensex breached its crucial 19,500 level. On the sectoral front, consumer durable, auto and capital goods were witnessing maximum gains in the trade, while software remained the only loser on the BSE sectoral space as profit booking continued in Infosys Technologies. The broader indices were out performing benchmarks. Meanwhile, Tata group companies viz., Tata Motors, Tata Consultancy Services, Tata Coffee and Tata Chemicals all were trading with a good gain at this point of time as the group plan to invest up to Rs 1.2 lakh crore across sectors in the domestic market in the next five years. The market breadth on the BSE was positive; there were 1391 shares on the gaining side against 420 shares on the losing side while 47 shares remained unchanged.

The BSE Sensex opened at 19,389.74; about 3 points higher compared to its previous closing of 19,386.82, and has touched a high and a low of 19,573.21 and 19,351.51, respectively.

The index is currently trading at 19,537.07, up by 150.25 points or 0.78%. There were 28 stocks advancing against just 2 declines on the index.

The overall market breadth has made a positive start with 74.87% stocks advancing against 22.60% declines. The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices were up 0.83% and 1.08% respectively. 

The top gaining sectoral indices on the BSE were, CD up by 1.83%, Auto up by 1.73%, CG up by 1.28%, Oil and Gas up by 0.90% and Metal up by 0.82%. While, IT down by 0.21% was the only loser on the index.

The top gainers on the Sensex were Hero Honda up by 5.80%, L&T up by 2.04%, TCS up by 1.67%, Jaiprakash Associates up by 1.61% and Sterlite Industries up by 1.61%.

Infosys down by 1.44% and Cipla down by 0.45% were the only losers on the index.

Meanwhile, in what came as very positive news for farmers and policy makers of the country, the monsoon this year is expected to be normal and no impact is likely from the Tsunami that hit Japan last month. Annual monsoon rains are critically important for a country like India where 60% of the cultivated land depends on monsoon for irrigation.

The South Asia Climate Outlook Forum (SACOF) that held a meeting in Pune on Friday said that overall outlook for monsoon was good. The forecasters said there was some likelihood of below normal rainfall over the north-western parts and some north-eastern parts of South Asia, but rainfall over the southern parts of South Asia, including the islands will be largely normal.

The SACOF, an initiative of the World Meteorological Organisation (WMO) to provide regional information, said that the La Nina weather phenomenon, which is critical in ensuring rains to the subcontinent, would continue until the start of the Indian monsoon season in June. 'The large-scale summer monsoon rainfall would most likely be within the normal range,' the Forum, comprising of weather officials and forecasters from across the world said.

The forecast of a near normal monsoon came amidst some met scientists raising concerns that the devastating Tsunami that hit Japan last month could also have some significant impact on pattern of summer rains in the region. The World Meteorological Organization however, has now stated that there was no sign, at least for now, that there will be any significant impact of Tsunami on monsoon pattern.

Monsoon rains are not only important for farm production but will also be critical to bring the elevated inflation down going forward in the year. The current inflation cycle that has seen the pace rising prices remaining above the comfort of central bank as well as the government had its genesis in the failed monsoon of 2009 that resulted in tight supply of food commodities and induced a food prices led inflation shock.

The S&P CNX Nifty opened at 5,824.35; flat compared to its previous closing of 5,824.55, and has touched a high and a low of 5,874.40 and 5,810.30 respectively.

The index is currently trading at 5,870.55, up by 46 points or 0.79%. There were 46 stocks advancing against just 4 declines on the index.

The top gainers of the Nifty were Hero Honda up by 6.15%, L&T up by 2.02%, HCL Tech up by 1.80%, TCS up by 1.65% and M&M up by 1.59%.

The top losers of the index were Infosys down by 1.44%, Cipla down by 0.45%, Kotak Bank down by 0.37% and BPCL was down by 0.07%.

Asian markets were trading on a mixed note; Shanghai Composite was up 8.30 points or 0.27% to 3,058.83, Hang Seng was up 37.28 points or 0.16% to 24,045.35, KLSE Composite was up 8.00 points or 0.53% to 1,529.94 and Straits Times was up by 8.78 points or 0.28% to 3,162.08.

On the flip side, Jakarta Composite was down 1.17 points or 0.03% to 3,729.34, Nikkei 225 was down 18.45 points or 0.19% to 9,573.07, Seoul Composite was down 5.98 points or 0.28% to 2,134.52 and Taiwan Weighted was down by 9.71 points or 0.11% to 8,708.41.

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