Indian stock indices have recovered a great deal from the lows hit in late morning session and the frontline indices are trading just below the neutral line. Marketmen have gone on to overlook the rebound seen in weekly inflations as they continued to show buying interests in heavyweight counters. Index heavyweight Reliance industries which languished in the red terrain has suddenly spurted and is currently trading in the positive terrain with over half a percent gains. While some short covering was also evident in IT and Automobile stocks. However, the domestic markets have failed to show any kind of fervor despite the sanguinity flowing in markets across the globe. The Asian peers traded with enthusiasm since early trades as sentiments got bolstered from the overnight rally on Wall Street where better than expected US durable goods data improved the risk appetite of investors. The European counters parts too got off to an encouraging opening led by Germany's DAX which was the top gainer in the space with over two and half a percent gains. Back home, investors and traders appeared to be in two minds about taking positions in the market ahead of the expiry of August series futures and options contracts later in the day and key US Fed Reserve meeting on Friday. What was disturbing from India's point of view was the rally in international crude prices especially Brent crude which touched $111 a barrel, as it dissuaded investors from taking positions in oil upstream and downstream companies.
Moreover, the broader markets traded on a weak note in the afternoon trades, declining around half a percent point and underperforming their larger peers. The bourses receded on strong volumes given that this is the day of August series F&O expiry while the market breadth on BSE was favor of declines in the ratio of 1467:973 while 114 scrips remained unchanged.
The BSE Sensex is currently trading at 16,258.13 down by 26.85 points or 0.16% after trading as high as 16,373.84 and as low as 16,137.55. There were 15 stocks advancing against 15 declines on the index.
The broader indices were trading on a negative note; the BSE Mid cap index eased 0.48% and Small cap shed 0.46% respectively.
On the BSE sectoral space, Oil & Gas up 0.78%, Auto up 0.54%m Healthcare up 0.49% and FMCG up 0.30% were the only gainers while Metal down 1.13%, IT down 1.09%, TECk down 0.90%, CD down 0.85% and CG down 0.66% were the major losers on the index.
ONGC up 2.63%, Tata Motors up 2.62%, Sun Pharma up 1.73%, Tata Power up 1.41% and Maruti Suzuki up 0.89 were the major gainers on the Sensex, while Jindal Steel down by 2.85%, JP associates down 2.33%, Tata Steel down 2.18%, HDFC down 1.51% and L&T down 1.12% were the major losers on the index.
A week after showing some signs of moderation, India's stubborn inflation numbers nudged up in the week ended August 13. However, fuel and power group inflation stood stable at 13.13% for the week ended August 13, the same as in the week ended August 6. The inflations numbers have risen despite the aggressive monetary tightening by Reserve Bank of India which has hiked key interest rates by eleven times since March 2010.
According to the data released by Ministry of Commerce and Industry, the index for Food Articles group rose by 0.4% to 192.7 (Provisional) from 191.9 (Provisional) for the previous week due to higher prices of fish-inland (2%) and mutton, gram, fruits and vegetables, egg, pork, bajra and masur (1% each). However, the prices of poultry chicken (3%) and jowar and moong (2% each) declined.
The index for Non-Food Articles group rose by 1.6% to 181.3 (Provisional) from 178.4 (Provisional) for the previous week due to higher prices of flowers (27%), raw silk (6%), niger seed and fodder (3% each), raw cotton and rape and mustard seed (2% each) and groundnut seed, sunflower and linseed (1% each). However, the prices of gingelly seed (5%), gaur seed and raw rubber (2% each) and castor seed and copra (1% each) declined.
As a result, the index for primary articles group which has the highest weightage of 20.12% in WPI rose by 0.5% to 198.5 (Provisional) from 197.5 (Provisional) for the previous week. The annual rate of inflation, calculated on point to point basis, stood at 12.40% (Provisional) for the week ended August 13 as compared to 11.64% (Provisional) for the previous week.
Meanwhile, the index for Fuel and Power group which has the weightage of 14.91% in WPI remained unchanged at their previous week's level of 167.2 (Provisional) and 13.13% (Provisional) for the week under consideration.
The inflation numbers, which continue to hover exceedingly higher than the central bank's comfortable levels, indicate that the it may not pause its liquidity tightening measures and continue with its hawkish stance in the next policy review meet in September.
The S&P CNX Nifty is currently trading at 4,873.40, lower by 15.50 points or 0.32% after trading as high as 4,915.85 and as low as 4,838.95. There were 25 stocks advancing against 25 declines on the index.
The top gainers of the Nifty were Tata Motors up 2.65%, ONGC up by 2.64%, Sun Pharma up 1.47%, Tata Power up 1.23%, and Maruti up 0.95%.
HCL Tech down 3.93%, Jindal Steel down 3.11%, JP Associates down 2.65%, Axis Bank down 2.36% and PNB down 2.31% were the major losers on the index.
Asian markets traded on an optimistic note, Shanghai Composite zoomed 2.87%, Hang Seng surged 1.50%, Jakarta Composite added 0.28%, Nikkei 225 soared 1.54%, Straits Times jumped 1.44%, Seoul Composite climbed 0.56%.
On the other hand, KLSE Composite slipped 0.50% and Taiwan Weighted dropped 1.23%.
The European markets traded on optimistic note as France's CAC 40 advanced 1.57%, Germany's DAX surged 2.69% and London's FTSE gained 0.88%.
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