Markets recover some of their losses

Indian equity markets have recovered some of their losses but are still trading in negative terrain in late morning session despite the strong cues from the other Asian counter parts, the US index futures were also trading in green.  Back home, on the BSE sectoral front, only FMCG and Capital Goods stocks were trading in green while rest all the indices are down in red, However, Realty, Auto, PSU Power and CD counters witnessing profit booking. The BSE Sensex and NSE Nifty were trading below their physiological level of 19500 and 5600 mark respectively. The market breadth on the BSE was negative; there were 1577 shares on the losing side against 1059 shares on the gaining side while 82 shares remained unchanged. The broader indices were also witnessing profit booking; the BSE Mid cap and Small cap indices decreased 0.46% and 0.59% respectively.

The BSE Sensex declined 28.35 points or 0.14% at 19,562.83.  The index has touched a high of 19,697.21 and a low of 19,463.56.

The top losers in the BSE sectoral indices were Auto down by 0.24% Realty down 1.15%, PSU down 0.88%, CD down 0.68% and Power down 0.62% while FMCG up by 0.59%, Capital Goods (CG) up 0.45% were the only gainers in the BSE sectoral indices.

The top gainers on the Sensex were Sterlite industries up by 2.15%, Bharti Airtel up by 1.82%, L&T up by 1.01%, ITC was up by 0.82% and HDFC Bank down 0.51%.

On the flip side JP associates down by 2.19%, Wipro down by 1.82%, Tata Motors down by 1.61%, Hero Honda down by 1.45% and Hindalco Industries down by 1.25% were the top losers on the index.

The debate on 'go' and 'no-go' areas for coal mining finally seem to be moving towards a logical conclusion with the environment ministry Jairam Ramesh softening his stand and agreeing to a review of the 'no-go' areas following a meeting of the empowered Group of Ministers (EGoM) deliberating on the matter.

At the meeting of the EGoM, the Ministry of Environment and Forests (MoEF) gave a number of signals of softening its stand. In a presentation given to the EGoM, Ramesh offered to let his ministry consider clearance applications from both "go" and "no go" categories. Applications for mines in the "no go" zones would be subject to strict scrutiny, and if possible, a compromise will be arrived at. If the MoEF cannot reach a compromise on any particular case, it could be sent to a Cabinet Committee.

Ramesh also agreed to increase the 'go' zone from 53% to 71% of the total area being considered. Another concession that the MoEF has agreed to offer is that all projects which had been given a Stage-I forest clearance would not be considered under the "no go" categorisation at all. All these concessions by the environment ministry are now likely to resolve the long pending debate and will also help the country boost its coal production.

The tussle between the coal and environment ministries started at the beginning of the last year when the coal ministry approached the MoEF seeking clarity on how much of India's seven big coalfields will be able to get green node or the environmental clearances. The MoEF said that out of the total 6.50 lakh hactare, only 3.50 lakh hectare would be considered for clearances for mining as the rest had sensitive forests above them and was classified as "no go' area. The decision was strongly protested by the coal ministry and it got good support of the power and steel ministries as well. 

To resolve the debate, and EGoM was constituted under the Finance Minister Pranab Mukherjee and was given the task to strike a compromise deal between the two ministries. The EGoM has so far had two meetings and after sticking to its stand in the first, the environment ministry has shown more flexibility in the second meeting. The coal ministry is expected to accept the concessions given by the environment ministry and the issue is now likely to be resolved soon.

The S&P CNX Nifty shed 15.40 points or 0.26% at 5,870.30. The index has touched a high of 5,926.95 and a low of 5,841.10 respectively. 

The top gainers of the Nifty were Sterlite industries up 2.12, Ranbaxy up by 1.60%, Bharti Airtel up by 1.54%, Sunpharma up by 1.03% and L&T up 0.88%.

R Power down by 2.25%, JP Associates down 2.09%, Wipro down by 1.89%, Ambuja Cement down by 1.85%  and BPCL down  1.80% were the major losers on the index.

The other Asian markets were trading mostly in the green; Shanghai Composite climbed 0.57%, Hang Seng gained .058%, Jakarta Composite added 0.26%, Nikkei 225 surged 1.85%, Straits Times rose 0.19% and Seoul Composite climbed  0.27% while Taiwan Weighted declined 0.08%.

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