Markets were trading marginally higher after opening on a soft note led by gains in heavyweight Infosys, Larsen & Tourbo and ITC. The Nifty touched a low of 5,557 in opening trades and recovered shortly after. The index was up 9 points, at 5,573 and Sensex advanced 36 points, at 18,543.
There was risk aversion towards equities as investors fretted over lack of consensus to contain high levels of debt in Europe. In the United States investors dumped stocks as there was no resolution over debt ceiling. The Dow Jones Industrial Average and the Standard & Poor’s 500 Index declined 0.8% each and the Nasdaq Composite Index lost 0.9%.
Shares across Asia lost ground on Tuesday morning led by losses in banking shares. Japan's Nikkei Stock Average dipped 0.7%, Hong Kong's Hang Seng declined 0.3% and China's Shanghai Composite was off 0.5%.
Markets in India will remain lacklustre as debt concerns will keep foreign investors on the sidelines. However, there were some positive developments from the government front. The Congress led government and Bhartiya Janata Party gave a fresh lease of life to the much awaited GST (Goods and Services Tax). The government agreed to appoint Sushil Modi, a senior BJP Member for implementing the tax which aims to streamline the complex Indian tax regime. Analysts said if the GST reform will unify India economically and the markets will view this development positively.
Among individual stocks, the third largest lender, HDFC Bank was up 0.2% and Ashok Leyland declined 1.2% ahead of first quarter results today.
BSE IT index was leading the gains, up 0.5%. HCL Technologies advanced 1%, Patni Computers added 0.9% and Infosys was up 0.6%.
Auto shares slipped in trade, the BSE Auto index was down 0.4%. Tata Motors slipped 2% as the stock went ex-dividend, Hero Honda declined 0.5% and Amtek Auto was down 0.4%.
From the broader markets, the midcap and the smallcap indices were flat, down 0.1% and 0.3% each.
Top gainers on the Sensex were Sterlite Industries, up 1.1%, NTPC advanced 1% and Bajaj Auto gained 0.9%. Prominent losers on the Sensex were Jindal Steel, down 0.4%, HDFC and Hindustan Unilever fell 0.3% each.
Market breadth was positive 933 stocks advanced for 487 stocks which declined.
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