The frontline Indian equity benchmarks continue to trade marginally lower in the afternoon trade, reversing the early morning's gains after the government data showed lower-than-forecast growth in industrial production in December. Also, most markets in Asia closed down and European markets started lower, after eurozone finance ministers demanded more austerity measures from Greece and a parliamentary seal of approval for the budget cuts before providing the second round of international aid.
At 02:43 pm ( IST), the BSE Sensex was 17,704, down 125 points over the previous close. It had earlier touched a day’s high of 17,890 and a day’s low of 17,627. It opened at 17,817.
NSE Nifty was quoting 5,368, down 43 points over the previous close. It has earlier touched a day’s high of 5,427 and a day’s low of 5,341. It opened at 5,399.
Tata Steel, Sesa Goa, BPCL, SAIL, Bajaj Auto, HCL Tech, PNB, Grasim, Bharti Airtel, ONGC, Tata Motors, TCS and Wipro are among the leading gainers.
While, Hindalco, Reliance Infra, J P Associat, IDFC, ACC, Reliance Power, Ambuja Cement, Power Grid, Cairn, M&M, STER, Maruti, Siemens, Ranbaxy and GAIL are among the laggards on the BSE and NSE.
Some sort of profit booking also seems to be setting in after January's stellar rally. The NSE Nifty has rallied by nearly 20% from the lows struck on Dec. 20 on the back of robust FII inflows. The foreign funds have poured in more than US$3bn into Indian equities year-to-date.
Only the Metals index on the BSE is trading in the positive terrain. Rest all sectoral indices on the BSE are in the red, led by Realty, power, Pharma, Banking and Oil & Gas indices.
The BSE Small-Cap index and the BSE Mid-Cap index are both down ~0.1% each.
INDIA VIX on the NSE is up !2% at 23.80 after being as low as 22.98 and as high as 24.47. It had closed at 23.30 yesterday.
India's factory output, as measured by the index of industrial production (IIP), grew by 1.8% in December as against 5.9% in November, data released by the Commerce Ministry showed today.
Industrial production had expanded by a healthy 8.1% in December last year.
Industrial output in the April to December 2011-12 period grew by 3.6% compared to the expansion of 8.3% in the corresponding period a year earlier.
Earlier, the Indian market gained modestly at start. The NSE Nifty remained above the psychological level of 5400 while the BSE Sensex traded above 17,800 before the IIP data spooked the sentiment.
The undertone was buttressed earlier by news that Greek leaders have reached an agreement on new budget cuts that are needed to get more international money and avoid a debt default. However, the eurozone finance ministers are yet to clear the new bailout funds pending an approval of the austerity measures by the Greek parliament.
Meanwhile, the US Labor Department’s count of Americans filing initial claims for jobless benefits dropped by 15,000 last week to 358,000. The four-week moving average fell to 366,250, its lowest since April 2008.
China’s exports fell for the first time in more than two years in January as trade was disrupted by the weeklong Chinese New Year holiday. The overseas demand was also hit by Europe’s prolonged debt crisis.
China's exports declined 0.5% from a year earlier, the customs bureau said today. Imports dropped by a more-than-forecast 15.3%, leaving a trade surplus of US$27.3bn.
Globally, equities have got off to a strong start in 2012. So, don’t be surprised if market players turn a little hesitant in pushing stocks much higher.
Indian market resumed its ascent on Thursday after the initial jerk in opening trade. The Nifty closed above 5400. There could be further rise in the Nifty towards 5500 in the coming days, provided the FII inflows remain positive and global markets are supportive.
Trend in FII flows:
The FIIs were net buyers of Rs. 12bn in the cash segment on Thursday while the domestic institutional investors (DIIs) were net sellers at Rs. 10.37bn, as per the provisional figures released by the NSE.
The FIIs were net sellers of Rs. 973.6mn in the F&O segment on Thursday, according to the provisional NSE data.
The foreign funds were net buyers of Rs. 4.5bn in the cash segment on Wednesday, as per final SEBI data. Mutual Funds were net buyers at Rs. 300mn on the same day.