Post session - Quick review

After flip-flopping for the entire trading session, benchmark equity indices finally settled in the favour of green in choppy session of trade on Wednesday.  Absence of any significant trigger at domestic front, mainly kept the trade lackluster at Dalal Street. However, the support which emerged at intra-day low level in the last leg of the trade pushed the frontline equity indices in the positive terrain. Further, even the positive global set-up spelled some optimism in Indian equity markets. Thus, in the high volume session of trade, 30 share index, Sensex, eked out gains of over quarter points, to shut shop above crucial 18600 levels, while 50 share index, Nifty, too managed to lure modest traction, to end above the psychological 5650 level. However, in the tug of war between the bulls and the bears, the later dominated the BSE Midcap space, which concluded little below its neutral line, in negative terrain. However, Smallcap index went home in green with gains of close to 3/10 percent. Meanwhile, trade of over Rs 1.72 lakh crore was done in terms of volume turnover (Provisional)

On the global front, Asian pacific markets, tracing overnight gains of Wall Street, climbed the most in the month before U.S. new-home construction report. U.S. data today may show housing starts climbed to the highest level in four years in September, following a report yesterday showing industrial production grew better than economist estimates. Additionally, European shares too were on gaining spree after two German lawmakers said the country is open to credit aid for Spain before a summit of European Union leaders tomorrow. Further, the gains in European markets were also thanks to Spain clinging on to its investment-grade debt rating.

Closer home, Consumer Durable, Capital Goods and Auto counters were the bright spot of the trade. Inversely, Realty, Oil & Gas, Metal and Information Technology emerging as the weak spell of trade, dragged the markets lower. Meanwhile, cement stocks were hit by profit-taking ahead of a slew of earnings results due on Thursday. ACC, Ultra Tech Cement, Ambuja Cements shares softened in the range of 0.50-2.50%. On the flip side, shares of aviation firms, namely, Kingfisher Airlines, Spicejet, managed a flight of safety after government took-off airport development fee (ADF) from Delhi, Mumbai airports. At present, Delhi Airport charges ADF of Rs 200 per domestic and Rs 1,300 per international passenger, while Rs 100 and Rs 600 respectively at Mumbai.

On the result front, HCL Technologies’ Q2 earning was a hit. The stocks before ending with a knock of over half a percent hit a 52 week high level on positing a bigger-than-expected 76% surge in July-September net profit at Rs 699.84 crore. Additionally, Karnataka Bank too squeezed out gains of over half a percent after the Mangalore-based private sector lender’s net profit rose nearly 186% year-on-year to Rs 117.2 crore in the second quarter of financial year 2012-13. On the flip side, Mindtree’s stock price sulked with a loss of over 4% on weak Q2 numbers. The company has posted a rise of 32.97% in its net profit at Rs 72.20 crore for the quarter ended September 30, 2012 as compared to Rs 54.30 crore for the same quarter in the previous year. The market breadth on the BSE ended negative; advances and declining stocks were in a ratio of 1331:1543 while 129 scrips remained unchanged. (Provisional)

The BSE Sensex gained 33.07 points or 0.18% and settled at 18610.77. The index touched a high and a low of 18,705.19 and 18,535.37 respectively. 16 stocks were seen advancing while 14 stocks were declining on the index (Provisional)

The BSE Mid-cap index was down by 0.06% while Small-cap index was up 0.32%. (Provisional)

On the BSE Sectoral front, Consumer Durables up by 0.83%, Capital Goods up by 0.66%, FMCG up by 0.46%, Auto up by 0.44% and HealthCare up 0.42% were the top gainers, while Realty down by 0.72%, Oil & Gas down by 0.65%, Metal down by 0.21% and IT down by 0.12% were the only losers in the space.

The top gainers on the Sensex were Tata Power up 2.07%, L&T up 1.32%, HDFC up by 1.22%, BHEL up by 0.92% and ITC up 0.88%, while, Gail India down by 1.95%, Reliance Industries down by 1.30%, Sun Pharma down by 0.98%, TCS down by 0.91% and SBI down by 0.76% were the top losers in the index. (Provisional)

Meanwhile, standing firm on earlier opinion, Attorney General (AG) has refused to give any fresh opinion on the inter-ministerial panel's decision of charging one-time fee for existing second-generation (2G) airwaves that would match the upcoming auction-determined price.

Highest law official in the country, Attorney-General Goolam E Vahanvati, earlier opined that only incumbent GSM operators such as Bharti, Idea, BSNL and Vodafone should be charged the auction-determined fee for excess airwaves they hold beyond the 6.2 MHz limit that too with a retrospective basis from July 2008.

The Empowered Group of Ministers (EGOM), however in the last week dismissing Attorney General's opinion, decided to charge all GSM operators prospectively a one-time fee for the remaining period of their 20-year licence for spectrums beyond 4.4 Mhz and CDMA operators to pay for all spectrum beyond 2.5 Mhz.

A day before the EGoM's meeting, Montek Singh Ahluwalia, casting its support in the favour of AG’s decision, averred that mobile phone companies should not be charged for airwaves up to the 6.2-MHz limit, as this was the contracted spectrum, and also squabbled that telcos made investments and built a market strategy on getting this quantum of airwaves, while adding that imposing a charge at this point would amount to unilaterally rewriting the contract.

The EGOM, however, was of the view that certain facts which the AG may not have taken into consideration for charging for spectrum above 6.2 MHz  is that the telecom department may be forced to give additional spectrum free to all those telcos who till now only have 4.4 MHz.

Further, the EGoM also felt that this will be against the spirit of the Supreme Court's order and therefore wanted a fresh opinion from the AG, which would be placed before the Union Cabinet, scheduled to meet on October 18 to decide on the EGoM’s recommendations. However, it remains important to be noted, that the industry will have to shell out a minimum of Rs 27,000 crore if the Union Cabinet clears the proposal in its meeting on Oct 18.

India VIX, a gauge for markets short term expectation of volatility lost 2.56% at 15.17 from its previous close of 15.57 on Tuesday. (Provisional)

The S&P CNX Nifty gained 12.25 points or 0.22% to settle at 5,660.25.The index touched high and low of 5,684.35 and 5,633.90 respectively. 28 stocks advanced against 21 declining ones while 1 stock remained unchanged on the index. (Provisional)

The top gainers on the Nifty were Lupin was up 2.93%, Tata Power up 2.06%, Cairn India up 1.72%, Ranbaxy up 1.64% and L&T was up 1.51%. On the other hand, DLF down 3.51%, Ambuja Cement down by 2.67%, Gail India down by 1.96%, ACC down by 1.37% and Reliance Industries down by 1.15% were the top losers. (Provisional)

The European markets were trading in green with, France’s CAC 40 up 0.33%, Germany’s DAX up 0.20% and the United Kingdom’s FTSE 100 up 0.35%.

Most of the Asian stock markets went home with a green mark on Wednesday as Moody's reaffirmed its rating on Spanish debt, which helped Australian and Hong Kong shares to touch biggest gains in almost three weeks. Investors were set to make strong positions ahead of European summit, which will be considered for further progress on the region's ongoing debt crisis. Meanwhile, South Korea's Kospi closed with modest gains, as stronger local currency helped boost airlines and builders. Shanghai Composite ended in green ahead of Thursday's growth data.