Short-term movement will be sideways for now

On Tuesday, foreign institutional investors were net buyers for third day in a row, while domestic institutional investors changed to net sellers. All the Asian indices opened in the positive today on the back of positive news from the US; where the retail sales topped expectations, the Federal Reserve left interest-rates at record lows and most of the largest US banks passed their annual stress test. We had mentioned in our yesterday’s closing report that the Nifty may reach the level of 5,495 and further to 5,610. Today the index crossed the first resistance. However, we may now see a sideways move. The NSE saw a volume of 86.11 crore shares, the highest since 6 March 2012.

Fitch Ratings on Tuesday upgraded Greece's credit rating from restricted default to B-minus with a stable outlook following the completion of the country’s debt swap with private investors.

The Sensex and the Nifty opened in the positive and in the first hour itself hit their intraday highs. The Sensex opened at 18,003 while Nifty resumed trade at 5,491. The Sensex’s intraday high was 18,041 while the Nifty touched 5,499. The highs were their best since 24 February 2012.

However, soon the market started a downward journey with the benchmarks hitting their day’s lows of 17,837 and 5,438 after the latest data showed inflation rising at a faster-than-expected 6.95% in February 2012. The benchmarks gained some strength after railway minister Dinesh Trivedi presented the Railway Budget 2012-13 in the Lok Sabha.  

Both the Sensex and the Nifty closed in positive. The Sensex rose 106 points (0.59%) to close at 17,919 while Nifty rose 34 points (0.63%) to settle at 5,464.

The wholesale price index (WPI) rose a faster-than-expected 6.95% in February from a year earlier, mainly driven by a surge in food prices, government data showed on Wednesday. The annual reading for December 2011 was revised upwards to 7.74% from 7.47%. WPI inflation stood at 6.55% in January 2012.

Train fares have been hiked for the first time in eight years. The railway budget stressed more on the safety aspect along with focusing on issues of consolidation, de-congestion and capacity augmentation, modernisation and bringing down operating ratio. According to the minister, Indian Railways will invest Rs 7.35 lakh crore during the 12th Five Year Plan period (2012-17), against Rs 1.92 lakh crore in the current one. The railways also plans to recruit about 100,000 people in the 2012-13 fiscal year

Shares of companies linked to orders from Indian Railways were: BEML (up 0.90%), Hind Rectifiers (rose 0.53%), Titagarh Wagons (down 4.25%), Kalindee Rail Nirman (down 6.55%), Container Corporation of India (down 1.49%), Kernex Microsystems (down 5.19%), Simplex Casting (down 3.97%), and Texmaco (down 0.50%)

All eyes are now set for mid-quarterly review of monetary policy tomorrow. The bankers are mixed in their views with most of them opining that after having cut cash reserve ratio (CRR) by 0.75 percentage points last week, the Reserve Bank of India (RBI) may not do much. While others feel that it is time for RBI to cut policy rate so that growth can be propped up which is on the path of moderation.

Last week, the RBI slashed CRR, the percentage of deposits that banks have to keep with the RBI, from 5.5% to 4.75%. With this, the central bank had infused Rs 48,000 crore into the economy.

All Asian indices, except for Shanghai Composite and Hang Seng closed in the positive on Wednesday. At the time of writing, all the European indices were trading in the positive, while the Dow futures and the S&P 500 futures were trading at a premium.

The advance-decline ratio on the NSE was at 797:903.

Among the broader indices, the BSE Mid-cap index gained 0.32% and the BSE Small-cap index fell 0.28%.

Among the sectoral indices BSE Bankex led (up 1.83%). Others among the top five positive performers were BSE Capital Goods (up 1.60%), BSE PSU (up 1.38%), BSE Power (up 1.05%) and BSE FMCG (up 0.90%). While BSE Realty was at bottom (fell 0.96%). Others at the losing end were BSE IT (fell 0.67%), BSE TECk (fell 0.51%), BSE Consumer Durables (fell 0.19%), BSE Metal ( fell 0.10%)

NTPC (up 2.63%); ICICI Bank (up 2.61%); Larsen & Toubro (up 2.47%); ONGC (up 2.21%) and Tata Motors (up 2.19%) were the top gainers on the Sensex. The major losers were TCS (down 3.56%); Wipro (down 1.41%); Tata Steel (down 1.10%); Jindal Steel (down 1.06%) and Bajaj Auto (down 0.93%).

The top performers on the Nifty were PNB (up 5.62%); BPCL (up 3.15%); NTPC (up 2.74%); Axis Bank (up 2.71%) and Larsen & Toubro (up 2.70%). The main laggards were TCS (down 3.76%); Jaiprakash Associates (down 3.17%); Reliance Communications (down 1.60%), Tata Steel (down 1.41%) and DLF (down 1.25%).

IL&FS Transportation Networks has bagged a road project from National Highways Authority of India in West Bengal and Odisha estimated to cost about Rs 471.05 crore. The project is on toll basis with a concession period of 24 years including construction period of 2.5 years and the estimated cost of the project is Rs 471.05 crore. The project is for construction of new bridges, structures and repair of the National Highway (NH-60) stretch between West Bengal and Odisha, it added. Besides, the project also involves operations and maintenance of the existing four-lane highway under National Highways Development Programme phase-I from Kharagpur in West Bengal to Baleshwar in Odisha. The stock closed at Rs 195.35 on the BSE, up 1.88%.