Indian equities continue firm trade paring off some gains

Indian equities continued its firm trade but pared off some gains from the highest point of day on the back of some encouraging developments from the global front ahead of a key US Federal Reserve meet outcome which may signal more measures to bring the weakening US economy back on recovery mode. Traders were seen selling piling up the positions in Oil & Gas, HealthCare and Power sector. Reliance Industries was trading with more than two percent gains helping Oil & Gas sector to provide much needed push to benchmarks inch higher. ONGC, GAIL and CAIRN India were too trading in green helping the sector to rally. Ranbaxy, Sun Pharmaceuticals and Dr Reddy was trading up with gains between one to two percent helping HealthCare sector scale higher. On the other side, Punjab National Bank, Kotak Bank and Axis Bank were in red excreting some pressure on benchmarks. Hero MotoCorp and Maruti Suzuki in Auto sectors were in red putting some pressure. In scrip specific development, shares of three state-run oil marketing companies HPCL, BPCL and IOC were in green on reports that oil companies plan to raise petrol prices by Rs 1.50 per litre to combat the continued rupee depreciation and hardening of crude oil prices. Reliance Communications is firm trending up on reports that Reliance Industries could use telecom assets of the company to launch its wireless broadband services. ADA Group companies Reliance Communications, Reliance Infrastructure and Reliance Power were trading in green. Piramal Healthcare is firm after the company settled a patent litigation over Baxter Healthcare's anesthetic drug SUPRANE. On the global front, Asian markets were trading in mixed note while the European markets were trading in green on optimistic note. Greece's prime minister won the backing of his cabinet to hold a referendum on a 130 billion euro bailout package. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 5,250 and 17,500 levels, respectively. The market breadth on the BSE was positive in the ratio of 1384:1296 while, 137 scrips remained unchanged.

The BSE Sensex is currently trading at 17,566.44 up by 85.61 points or 0.49% after trading as high as 17,615.26 and as low as 17,337.65. There were 20 stocks advancing against 10 declines on the index.

The broader indices were trading in the green terrain; the BSE Mid cap index advanced 0.43% while Small cap added 0.17%.

On the BSE sectoral space Oil & Gas up 1.48%, Healthcare up 0.73%, Power up 0.71%, Auto up 0.46% and Realty up 0.40% were major gainers while there were no losers in the space.

RIL up 2.13%, M&M up 1.43%, Hindalco up 1.29%, Tata Motors up 1.29% and JP Associates up 1.25% were the major gainers on the Sensex, while Hero Moto down 1.74%, Wipro down 1.11%, Bharti Airtel down 1.08%, Coal India down 0.92% and Tata Steel down 0.34% were the major losers on the index.

Meanwhile, in a move to enhance competitiveness and promote micro and small enterprises’ (MSEs) growth, the government owned departments and public sector units (PSUs) will have to give first preference to MSEs, including those belonging to SC/ST entrepreneurs. The public procurement policy for MSEs, which the union cabinet approved on November 1, has set an annual target of 20% procurement for the central government departments and PSUs from MSEs.

Additionally, in the minimum limit of 20%, orders worth 4% must be placed to SC/ST entrepreneurs. However, the minimum procurement limit would become compulsory only after 3 years. Till that time, it would be voluntary upon the central government department and PSUs to procure from the MSEs.

Virbhadra Singh, Minister of Micro, Small and Medium Enterprises said the announcement of the new policy has triggered expectations that PSUs would buy goods worth Rs 35,000 crore from the MSEs. Of this, a business of Rs 7,000 crore would go to the SCs/STs. On the other hand, this would also ensure that the public sector, which at present procures a mere 4-5% from the segment, can enhance its purchases from this sector.

The preferential procurement policy for MSMEs also exists in countries such as Australia, China, the European Union and the USA. The industry had welcomed the move of the government, as this move of government will enhance the competitiveness and also promote inclusive growth. The sector has been affected badly from the increasing input cost and interest rates.

The MSMEs plays very important role in the Indian economy as it accounts for 45% of India’s manufacturing output and around 40% of country’s export. The sector also provides employment to 60 million people in 26 million units which produce more than 6,000 products. The MSMEs also contribute around 8% of the county’s Gross Domestic Products.

The S&P CNX Nifty is currently trading at 5,288.80, higher by 30.85 points or 0.59% after trading as high as 5,300.10 and as low as 5,204.95. There were 37 stocks advancing against 12 declines one while 1 stock remained unchanged on the index.

The top gainers on the Nifty were RCOM up 6.45%, Reliance Power up 4.00%, Reliance Infra up 3.85%, IDFC up 2.92% and SAIL up 2.85%.

PNB down 2.79%, Hero MotoCorp down 1.83%, Bharti Airtel down 1.08%, Coal India down 0.79% and Wipro down 0.63% were the major losers on the index.

Asian markets traded on a mixed note, Shanghai Composite surges 1.38%, Hang Seng climbed 1.88%, Jakarta Composite jumped 1.97% and Straits Times garnered 1.44%.

On the flipside, KLSE Composite declined 0.32%, Nikkei 225 plummeted 2.21%, Seoul Composite sank 0.61% and Taiwan Weighted shed 0.31%.

The European markets were trading in green with, France’s CAC 40 up 1.32%, Germany's DAX advanced 1.65% and Britain’s FTSE 100 ascended 0.81%.