Indian markets open lower on profit booking

The Indian equity markets have made a weak start shrugging off overnight rally in US markets as investors booked their profits recorded in the previous two sessions amid a weak trend in other Asian markets. The US markets surged on Tuesday and the major indices were able to post their biggest jump in nearly two weeks while, most of the Asian peers were trading in the negative terrain at this point of time after credit ratings agency Moody's downgraded Japanese credit rating. Back home, squaring up of pending positions by speculators ahead of monthly expiry in the derivatives segment also cast a shadow over the trading sentiment. On the sectoral front consumer durables witnessed the maximum gain in trade followed by realty and healthcare while, software, technology and metal witnessed the most selling pressure, dragging down the Sensex. However, the broader indices were outperforming benchmarks and the market breadth on the BSE was positive; there were 1,131 shares on the gaining side against 466 shares on the losing side while 48 shares remained unchanged. 

The BSE Sensex opened at 16,490.78; about 8 points lower compared to its previous closing of 16,498.47, and has touched a high and a low of 16,498.63 and 16,405.50 respectively.

The index is currently trading at 16,456.86 down by 41.61 points or 0.25%. There were 13 stocks advancing against 17 declines on the index.

The overall market breadth has made a positive start with 68.75% stocks advancing against 23.33% declines. The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices surged by 0.68% and 0.75% respectively.

The top gaining sectoral indices on the BSE were, CD up by 1.14%, Realty up by 0.67%, HC up by 0.47%, Bankex was up by 0.39% and PSU was up by 0.17%. While, IT down by 1.02%, TECk down by 0.58%, Metal down by 0.50%, FMCG down by 0.39% and CG down by 0.12% were the top losers on the index.

The top gainers on the Sensex were Cipla up by 1.34%, Bajaj Auto up by 1.05%, HDFC up by 1.05%, DLF up by 0.99% and ONGC was up by 0.70%.

On the flip side, Jindal Steel was down by 2.54%, Tata Power was down by 1.67%, TCS was down by 1.38%, Coal India was down by 1.21% and ITC was down by 1.16% were the top losers on the Sensex.

Meanwhile, the Corporate Affairs Minister, Veerappa Moily expressed hope that the much awaited the Companies Bill 2009 will be passed in this monsoon session or in winter session. "We are ready with the Cabinet note. If the Government asks us, we will give it, Moily said. The Parliamentary Standing Committee on Finance had given its observations on the Bill in August 2010.

The new Companies Bill will replace half century old act. The bill was prepared in the backdrop of Rs 14,000 crore Satyam Scam, the new bill promises greater shareholder democracy and stricter corporate governance norms. The new companies' bill has introduced ideas like Corporate Social Responsibility (CSR), class action suits and a fixed term for independent directors.

The bill also recommends to strict the laws for raising money from public. The Companies Bill also seeks to ban any insider trading by company directors or any key managerial personnel by trading such activities as criminal offence.

Additionally, the bill also suggested that companies should earmark 2% of the average profit of the last three years for CSR activities and make a disclosure to shareholders about the policy adopted in the process.  The Companies bill (2008) failed because of the dissolution of the 14th Lok Sabha, and it was reintroduced in the monsoon session of 2009.

The S&P CNX Nifty opened at 4,934.35; about 12 points lower compared to its previous closing of 4,948.90, and has touched a high and a low of 4,948.30 and 4,918.65 respectively.

The index is currently trading at 4,937.20, lower by 11.70 points or 0.24%. There were 24 stocks advancing against 26 declines on the index.

The top gainers of the Nifty were Reliance Capital up by 3.01%, RCom up by 2.26%, Reliance Infra up by 1.90%, Cipla up by 1.51% and RPower up by 1.36%.

On the flip side, Jindal Steel down by 2.87%, Tata Power down by 1.81%, TCS down by 1.68%, ITC down by 1.40% and Infosys down by 1.06%, were the major losers on the index.

Most of the Asian counterparts were trading in the red; Jakarta Composite was up 4.18 points or 0.11% to 3,884.64, KLSE Composite was up 3.10 points or 0.21% to 1,485.47 and Shanghai Composite was down by 4.30 points or 0.17% to 2,558.32.

On the flip side, Hang Seng was down 161.01 points or 0.81% to 19,714.52, Nikkei 225 was down 19.32 points or 0.22% to 8,713.69, Straits Times was down 15.73 points or 0.57% to 2,749.42, Seoul Composite was down 7.34 points or 0.41% to 1,769.34 and Taiwan Weighted was down by 48.13 points or 0.64% to 7,502.10. 

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