Indian indices buck the trend

Today's major news

3G auction ends; pan-India bid touches Rs16,828 crore

3G mop-up to help govt cut fiscal deficit

Food inflation inches up to 16.49%

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Global signals

European stocks fell late on Thursday on persistent concerns that other European countries may follow Germany's footsteps to ban short selling in some financial instruments. FTSE 100 was trading lower by 0.21%.

All the major Asian indices closed in the negative territory. SGX Nifty closed 14.5 points higher.

US stock futures signal to a mixed opening on the Wall Street on Thursday. Investors will keep an eye on data for weekly claims for jobless benefits and earnings of Staples and Compuware Corp, which will be announced later on the day.

Indian indices

After sliding by close to 700 points in the last few trading sessions, the Sensex rose by 0.68% taking a breather as the developments in the domestic markets took the front seat. Today, the Sensex ignored all the negative cues coming from across the globe, putting a pause on to the losses, as oil & gas stocks led the way for the index. The mayhem in Europe that had spoiled the global sentiments seemed to have no effect on the Indian markets today.

The two positive announcements that came in after the market hours yesterday (May 19, 2010) includes, 3G kitty swelling to almost Rs68,000 crore (almost double of estimated Rs35,000 crore) will boost the Indian economy by bringing down the fiscal deficit to around 4.9% from 5.5% of gross domestic product (GDP) projected in the Budget for 2010-11. This might help to improve the India's sovereign rating. Second, the government doubling the price of natural gas under the administered pricing mechanism (APM) to $4.2 per million British thermal units (mbtu), as against current $1.79 per mbtu, boosted the oil & gas stocks. These news back home helped the Indian indices to outperform its global peers. The Indian indices were in green while other global markets were in red.

Bulls were running their way with no worries. The strength was seen through out the session. It seemed like the markets have calmed down after the storm.

The 30-stocks Sensex started the session 11 points higher at 16419 making its day's low. The gains expanded amid volatility. Despite food inflation inching to 16.49% for week ended May 08, 2010 as compared to 16.44% in the previous week, the market remained strong. Post lunch, the markets hit the day's high of 16618 as European indices opened in green after yesterday's heavy sell-off. However, in the last hour of trading, the Sensex pared some of its gains. At closing bell, the Sensex quoted at 16520, 111 points higher. The Nifty also advanced 28 points to closed at 4948.

Market sentiment

Despite of positive closing, market breadth was negative as declining stocks outnumbered advancing stocks. Of the 2,926 stocks traded on the BSE, 1,670 stocks declined, whereas 1,143 stocks advanced. Hundred and thirteen stocks remained unchanged.

Sectoral & stock screening

PSU stocks did well for the day, with BSE PSU up by 1.87%. BSE Oil & Gas was second gainer in the sectoral list, advanced by 1.79%. On the other hand, BSE Realty down by 2.04%, the most for any sector, followed by BSE Auto and BSE CD that fell marginally by 0.53% and 0.17% respectively.

Among 'A' group stocks: the top three gainers were Oil and Natural Gas Corporation (up 8.7%), Piramal Healthcare (up 8.52%) and LIC Housing Finance (up 4.08%). The top three losers were Educomp Solutions (down 9.07%), Everest Kanto Cylinder (down 6.21%) and Housing Development and Infrastructure (down 4.79%).

Viewing volumes

India's second largest developer Unitech saw highest trading with over 0.82 crore shares changing hands on the BSE, followed by Anil Dhirubhai Ambani Group company Reliance Natural Resources (0.49 crore shares), wind turbine major Suzlon Energy (0.42 crore shares), cement manufacturer Jaiprakash Associates (0.34 crore shares) and industrial finance company IFCI (0.31 crore shares).