Healthy macro-data, short covering buoy equity markets

Mumbai, June 14 (IANS) After two continuous sessions of losses, the Indian equity markets on Wednesday edged higher to close on a flat-to-positive note on the back of short covering and healthy buying in capital goods, oil and gas as well as energy stocks.

According to market observers, the key indices trimmed their losses just ahead of the outcome of the two-day US Federal Reserve's rate-setting meet later in the evening.

Further, healthy buying was witnessed in the index heavyweights such as Reliance Industries, ICICI Bank and Larsen and Toubro (LT).

The wider 51-scrip Nifty of the National Stock Exchange (NSE) inched up by 11.25 points or 0.12 per cent to close at 9,618.15 points.

The 30-scrip Sensitive Index (Sensex) of the BSE, which opened at 31,147.69 points, closed at 31,155.91 points -- up 52.42 points or 0.17 per cent from its previous close at 31,103.49 points.

The Sensex touched a high of 31,190.36 points and a low of 31,054.94 during intra-day trade.

The BSE market breadth was bearish -- with 1,461 declines and 1,212 advances.

In terms of the broader markets, the BSE mid-cap index underperformed the Sensex, while the small-cap index outperformed it. The S&P BSE mid-cap index was a tad up at 0.01 per cent and the small-cap index rose by 0.46 per cent.

"Markets ended with marginal gains on Wednesday, after two sessions of losses, ahead of the FOMC (Federal Open Market Committee) meeting outcome. Trading activity remained within a small range as investors chose to stay on the sidelines and awaited clarity on the Federal Reserve's future path for US policy," Deepak Jasani, Head - Retail Research, HDFC Securities, told IANS.

"Index heavyweights Reliance Industries, ICICI Bank and LT led the upmove on the domestic bourses. However, another index heavyweight ITC dropped. Major Asian markets have ended on a mixed note, while European indices like FTSE 100, CAC 40 and DAX traded higher," he added.

On the macro front, official data released during market hours showed that India's annual rate of inflation based on wholesale prices decelerated last month to 2.17 per cent from 3.85 per cent in April as food prices eased.

The rupee strengthened slightly by 3-4 paise to 64.30 to a US dollar from its previous close of 64.33-34.

In investments, provisional data with the exchanges showed that foreign institutional investors (FIIs) sold stocks worth Rs 161.13 crore, while domestic institutional investors (DIIs) bought scrips worth Rs 71.65 crore.

"The equity benchmarks ended the market marginally positive covering in the second half of the session," said Dhruv Desai, Director and Chief Operating Officer of Tradebulls.

"Delivery volume was lower compared to yesterday (Tuesday) on account of US Fed's meeting today but index future and options witnessed heavy volumes compared to yesterday. Nifty PSU Bank extended gains in last hour of trade, rising more than a per cent."

Sector-wise, the S&P BSE capital goods index rose by 152.89 points, the oil and gas index by 93.09 points, and the energy index by 52.06 points.

On the other hand, the S&P metal index fell by 81.95 points, the FMCG index by 68.54 points and the healthcare index by 25.80 points.

Major Sensex gainers on Wednesday were: Reliance Industries, up 3.30 per cent at Rs 1,335.90; Dr Reddy's Lab, up 1.41 per cent at Rs 2,665.05; L&T, up 1.40 per cent at Rs 1,761.45; ICICI Bank, up 1.38 per cent at Rs 319.15; and Hero MotoCorp, up 0.91 per cent at Rs 3,786.65.

Major Sensex losers were: Cipla, down 2.16 per cent at Rs 538.65; ITC, down 1.62 per cent at Rs 299.75; HDFC, down 1.29 per cent at Rs 1,646.95; Wipro, down 1.27 per cent at Rs 256.05; and Tata Steel, down 1.13 per cent at Rs 502.85.