Markets witness modest recovery; still in the red

Although still into the negative, the markets managed to recoup some of the losses during the previous hour of trade due to sustained selling in several blue chip stocks. The global cues were also not supportive as rest of the Asian markets barring Taiwan Weighted, which was up by 0.15%, were trading in the red followed by overnight losses in the U.S. market. The US index futures too were trading in the red at this point of time. Back home, both the 30-share barometer -- Sensex and the wide-based National Stock Exchange Nifty index are trading above their psychological 18,500 and 5,550 levels. On the sectoral front, realty and auto segments are trading higher. FMCG, PSU and consumer durables are also up in trade; while metal and information technology stocks are mostly trading weak. Broader markets have managed to hold their neck in the green; the BSE Mid cap and Small cap indices gained 0.17% and 0.19%, respectively. The market breadth on the BSE was in favour of advances in the ratio of 1204:1102 while 104 scrips remained unchanged. Meanwhile, as per the data released by Central Statistics Organisation (CSO), India's industrial output rose to 7.3% in March from 3.6% in February this year. However, for the year (FY11) industrial output grew a meagre 7.8% as compared to 10.5% clocked in the previous fiscal.

The BSE Sensex dipped 23.25 points or 0.13% at 18,561.71. The index has touched a high of 18,610.02 and a low of 18,458.98, respectively.

The BSE Mid cap and Small cap indices gained 0.17% and 0.19%, respectively.

The top gainer on the BSE sectoral space were Realty up 0.85%, Auto up 0.62%, FMCG up 0.31%, PSU up 0.25% and Consumer Durables (CD) up 0.16%.

On the flip side, Metal down 0.82%, Information Technology (IT) down 0.27% and TECk down 0.23% were the only losers in the BSE sectoral space.

The top gainers on the Sensex were DLF up 1.39%, ONGC up 1.30%, Bajaj Auto up 1.14%, Reliance Infra up 0.68% and Tata Motors up 0.61%.

On the flip side, Hindalco Inds down 2.54%, Sterlite Inds down 1.76%, HDFC down 1.36%, TCS down 1% and RCom down 0.44% were the major losers on the index.

As Indian companies are strengthening their presence in the US and are spreading their wings across many sectors, trade between India-US is estimated to grow to $100 billion in the next two-three years. The increase in trade volume will be mainly led by growth of several sectors like food processing, education and infrastructure. Another factor which will drive the growth will be investment of around $10 billion in the next five years by India Inc to start green-field projects in sectors such as manufacturing and services, a trend which is relatively new as earlier Indian companies used to buy established companies instead of investing in green-field projects.

Meanwhile, engagement between the Indian and the US small and medium enterprise (SMEs) sectors will also be a crucial factor for creating a favorable business and policy environment to strengthen economic recovery, stimulate growth and create jobs in both the countries, since SMEs represent a good low-investment, high-return opportunity.

Currently, the bilateral trade between both the countries stands at $50 billion annually and after the visit of US president Barack Obama to India last year, the US government has removed nine Indian space and defense-related companies, including those from the Indian Space Research Organization (ISRO) and Defense Research and Development Organization (DRDO), from its banned 'Entity List', a move which is expected to bolster high-technology trade between the two countries.

The S&P CNX Nifty slipped 8.85 points or 0.16% at 5556.20.  The index has touched a high and a low of 5572.50 and 5527.30, respectively.

The top gainers of the Nifty were Grasim Inds up 1.41%, DLF up 1.34%, ONGC up 1.15%, Bajaj Auto up 1.11% and Siemens up 1.08%.

On the flip side, Hindalco Inds down 2.88%, Sterlite Inds down 2.06%, HDFC down 1.52%, TCS down 1.21% and Sesa Goa down 1.10% were the major losers on the index.

Rest of the Asian markets barring Taiwan Weighted, which was up by 0.15%, were trading in the red. Shanghai Composite declined 0.31%, Hang Seng plunged 1.11%, Jakarta Composite dropped 0.40%, KLSE Composite dipped 0.18%, Nikkei 225 plummeted 1.31%, Straits Times shed 0.92% and Seoul Composite lost 1.66%.

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