Benchmarks trim some loss; Sensex claims back 18800 mark

Prolonging previous session's descending trajectory, the 30 scrip sensitive index-Sensex-after falling below its key psychological level in the early deals, has now gained some lost ground, thereby claiming back its key psychological level of 18,800. Putting up the tough face of resilience, benchmarks have now cut short some of the losses in the wake of weak global leads. As the worries related to weakest growth in U.S. jobs in nine months and concern that Europe's debt crisis will spread to Italy have been lingering since the start of the trade. Weak Asian stocks tracking an overnight fall of the Wallstreet, are majorly dictating the movement of Indian equity markets. Meanwhile, the US future indices too are showcasing a downtick in the screen trade. Back home, cautious approach is also adopted by participants ahead of the Cabinet re-shuffle, policy actions like decontrol of DAP fertiliser prices ahead of monsoon session of parliament and the results by Infosys, as this would dictate near term direction of markets. On the BSE sectoral front, stocks from Consumer Durable, Fast Moving Consumer Goods and Oil & Gas counters are enticing investor's attention, while Information Technology, TECk and Real space are languishing at the bottom. The 30 share index, trading lower by 50 points is currently above its 18800, while the 50 share index losing despite losing over 15 points, is trading well over its 5600 mark. Meanwhile, the broader indices are currency hovering around their neutral line. The overall market breadth on BSE is in the favour of advances which have outpaced declines in the ratio of 1166:1036, while 91 shares remained unchanged.

The BSE Sensex is currently trading at 18,807.47, down by 50.57 points or 0.27%. The index has touched a high and low of 18,843.97 and 18,738.32 respectively. There were 11 stocks advancing against 19 declines on the index.

The broader indices were trading flat; both BSE Mid cap and Small cap index were trading up by 0.03%.

The top gaining sectoral indices on the BSE were, CD up by 0.87%, FMCG up by 0.53%, Oil and Gas up by 0.38%, HC up by 0.36% and Auto up by 0.34%. While, IT down by 1.44%, TECk down by 1.21%, Realty down by 0.81%, Bankex down by 0.69% and Metal down by 0.68% were the top losers on the index.

The top gainers on the Sensex were Reliance Communication up by 2.15%, M&M up by 1.69%, ITC up by 0.97%, ONGC up by 0.89% and NTPC up by 0.87%.

On the flip side, up by Hindalco down by 2.89%, Infosys down by 2.15%, BHEL down by 1.57%, Maruti Suzuki down by 1.55% and DLF down by 1.10% were the top losers on the index.

Meanwhile, private equity (PE) investments for the first half of 2011 calendar year have seen an increase of 38% to $5.8 billion. This jump of 38% in PE investment is led by increased number of large-size transaction and increased activities in infrastructure sector. With capital markets remaining sluggish, more and more investors seem to be preferring the PE route to raise funds.

According to the global consultancy firm Ernst & Young (E&Y), the PE deal value in the six months ended June climbed 34% to $5.8 billion as compared to same period a year ago," E&Y Partner (Private Equity) Mayank Rastogi said, 'The increase in aggregate deal value was largely driven by greater number of large deals (deals over $100 million). Top 10 deals in H1 '11 aggregated $2.7 billion compared to $1.75 billion in H2 '10 and $2 billion in H1 '10."

During the first six months of 2011, PE deals were much higher than 154 transactions saw in the six months of last year. Infrastructure attracted maximum private equity investment in first six months of 2011, it accounted for more than $1.35 billion. In terms of numbers of deals, retail and consumer products saw highest deals with 29 transactions. It was followed by infrastructure with 28 deals and technology with 23 transactions.

 'This trend of infrastructure sector attracting the most PE investments has continued from H1 '10 and H2 '10, where it recorded 27% ($1.16 billion) and 36% ($1.36 billion) of aggregate PE investments, respectively,' Mayank Rastogi said.

The major PE investments in the first six months include GIC and Bain Capital investing in $850 million into Hero Investment. Other major transactions were Apollo Management LP investing $350 million in Welspun Corp and Apax Partners investing $330 million in iGate Patni.

According to E&Y, India-focused private equity funds mopped up as much as $2.8 billion in the first half of 2011. Conversely, because of weak capital market conditions, exit activities of PE players remained slow, 'the volatile capital markets have been a significant factor for such decline in exit activity during H1 '11,' E&Y noted.

The weak market conditions have helped to increase the activities of PE; many companies which have failed to raise money from IPOs or were looking to raise money on public market are now actively looking to raise money from private equities.

 The S&P CNX Nifty is currently trading at 5,640.85, down by 19.80 points or 0.35%. The index has touched a high and low of 5,652.90 and 5,621.90 respectively. There were 18 stocks advancing against 32 declines on the index.

The top gainers of the Nifty were Reliance Communication up by 2.10, Ranbaxy up by 2.03%, M&M up by 1.65%, Siemens up by 1.11% and ITC up by 0.90%.

Hindalco down by 2.84%, SAIL down by 2.24%, Infosys down by 2.15%, Maruti Suzuki by 1.64% and BHEL was down by 1.60%, were the major losers on the index.

All the Asian equity indices barring Shanghai Composite were trading in the red; Hang Seng declined 0.88%, Jakarta Composite decreased 0.17%, KLSE Composite lost 0.59%, Nikkei 225 slid 0.67%, Straits Times descended 0.70%, Seoul Composite plunged 1.06% and Taiwan Weighted was down with a cut of 1.11%.Meanwhile, Shanghai Composite was trading flat, up by 0.07 points 

Unit-8, 3rd Floor, First Mall, The Mall, Ludhiana-141001, Punjab (INDIA).

To unsubscribe or change subscriber options visit: http://www.aweber.com/z/r/?TJzsLEwstCyc7OysHMyctEa0jAzMHMwMTEw=