As suggested yesterday, the market is taking a breather before the next move which is possibly up

The market accrued marginal gains in trades today. The Sensex ended the day at 17,462, up 50 points (0.3%) and the Nifty closed at 5,233, up 11 points (0.2%). The indices started the day with a sharp rise, taking cues from the global markets. However, they traded in a narrow range, touching an intraday low in the early afternoon session. Recovery from that point was limited, as gains were pared in late trading.

Asian markets were up on a report indicating growth in New York manufacturing, which brought back hopes that a recovery was underway in the US. Key indices in Indonesia, Japan, South Korea, and Singapore were up by 0.71% to 1.81%. Markets in China, Hong Kong and Taiwan were closed for the Dragon Boat Festival holiday.

US markets rallied on Tuesday as the euro gained against the dollar after a number of successful European debt auctions eased investor concerns about the eurozone's solvency crisis. The Dow was up 213.9 points (2.1%) at 10,404.77. The S&P 500 rose 25.6 points (2.3%) at 1,115.23 and the Nasdaq gained 61.9 points (2.7%) at 2,305.8.

Back home, the Reserve Bank of India (RBI) said that rates are not indicative of the high growth in the economy and should be curbed by controlling interest rates. Planning Commission deputy chairman Montek Singh Ahluwalia said that weekly movements in India's inflation will not have any impact on reforms to free fuel prices.

The monsoon is running four to five days behind schedule and has yet to reach half of the country. After an initial halt, the monsoon has reached the rice, cane and oilseed growing south-western region of India. However, it is yet to reach the soybean-growing areas of central India.

The government (after market hours) on Tuesday, 15th June, proposed the imposition of capital gains tax on all stock market transactions by Indians and overseas funds as a part of the proposed changes in tax laws. As per the second draft of the Direct Tax Code (DTC), the securities transaction tax (STT) will stay and rates will be calibrated. In the first draft of the DTC unveiled last year, the government had proposed to scrap the STT. The DTC has proposed taxing gains from investments in the stock market and also equity-linked mutual fund units at the applicable rate of taxation. The DTC has also proposed some taxes on income of foreign funds, treating all incomes from their investments in the stock market in India as capital gains.

Foreign institutional investors were net buyers of Rs590 crore on Tuesday. Domestic institutional investors were net sellers of stocks worth Rs351 crore. 

PBA Infrastructure (up 0.2%) has received a contract from Maharashtra Industrial Development Corporation (MIDC) for construction of a road and allied work at IT Park-II (Phase-I) in the Nagpur Industrial Area. The contract is worth Rs14.33 crore.

International Specialty Products, a US-based chemical supplier, has forged a manufacturing alliance with Vivimed Labs (up 1.1%) for production of UV absorbers. The alliance will allow the two companies to jointly market specific products used in sprays and lotions.

Dynamatic Technologies (up 1.3%) said that deliveries of the first sets of Air Frame Structures for India's largest defence programme, the Sukhoi 30 MKl fighter bomber, have commenced from the company's facility in Nasik. The Air Frame Structures include canards, ventral fins, horizontal stabilisers, slats, vertical fins and air brakes. The assembly transfer from its Bengaluru facility to the new facility, provided by Hindustan Aeronautics at Nasik, will be completed by August 2010, enabling Dynamatic to offer greater production support to HAL.

Essar Oil (closed flat) on 15th June, issued $115 million Foreign Currency Convertible Bonds (FCCBs) due June 2028 to promoter company Essar Energy Holdings Ltd, for part-financing expansion programmes of the company. The FCCBs are convertible into Global Depository Shares (GDS) or equity shares, at the option of the bondholders, at a conversion price of Rs138 per share.