Markets pare losses as metal, realty shares gain

BSE PSU, Auto, Oil & Gas, IT and Power indices have declined by nearly 1% each

Markets have pared losses in late-morning trades. The Sensex is down 45 points at 19,178. Nifty is down nine points at 5,804.

Broader markets have outperformed the benchmark index. BSE mid-cap index is up 0.6% at 6,240. Small-cap index is up 0.5% at 5,836.

BSE IT index is leading the losses at the moment. The index is down 0.5% at 6,044. PSU, auto, oil & gas and power indices are down marginally as well. On the other hand, the metal index is up 1.3% at 8,097. Consumer durables, realty and healthcare indices are up 0.3-1% each.

The rupee failed to maintain initial gains against the American currency by slipping six paise to 58.83 per dollar on renewed demand from banks and importers in view of sustained foreign capital outflows.

_________________________________
(Updated at 1051 hrs)

Benchmark indices continue to trade lower tracking weak Asian cues along with index heavyweights and financials leading the downfall.

By 1030 AM, Sensex fell by 87 points at 19,136, and the Nifty down 24 points at 5,790 levels.

Adds Shshank Mehta, derivatives strategist, Shah Investor's Home, “We are advising our clients to create short positions by going short on Nifty Futures and simultaneously buying a 5800 Call Option at this juncture (Nifty Futures are currently trading at 5783 at 10.20 am); we observe that market is taking a breather; however, the trend continues to be weak and a long bet would emerge only on a decisive close above 5850 in Nifty Futures.”

On the global front, Japanese stocks started trade on Wednesday with a spring in their step thanks to a positive lead from Wall Street and a softer yen, but the rest of Asia was restrained as investors waited for clarity on the Federal Reserve's next policy step.   

Major currencies were subdued as well ahead of the outcome of the Fed's policy meeting due at 1800 GMT and Chairman Ben Bernanke's media briefing half an hour later.   MSCI's broadest index of Asia-Pacific shares outside Japan was a touch softer, while Tokyo's Nikkei average rallied 2.0% to a one-week high.   

Back home, the rupee fell to 58.87 versus the dollar on Wednesday, close to its record low ahead of the outcome of the Federal Reserve meeting that may signal a tapering down of the US stimulus programme.

On the sectoral front, BSE PSU, Auto, Oil & Gas, IT and Power indices have declined by nearly 1% each. However, BSE Metal index gained by nearly 1%.

The main losers on the Sensex at this hour include NTPC, ONGC, Coal India, Tata Motors, TCS, Infosys, ICICI Bank, Maruti Suzuki and ITC, all falling between 1-2%.

Banking and financial shares have dropped after the Reserve Bank of India on Monday decided to halt its rate easing cycle, following the rupee's sharp fall since May and inflationary concerns.

On the gaining side, JSPL is the top Sensex gainer, up over 3%. Bharti Airtel, GAIL, Tata Steel and BHEL are other gainers.

Bharti Airtel has extended yesterday’s gain after the Telecom Regulatory Authority of India (TRAI) announced reduction in the national mobile phone roaming charges, but said there will be no free national roaming as of now.

The telecom regulator has also come out with conditional free national roaming plans, a move that will bring down cellphone roaming charges. The changes will come into effect from July.

Among other shares, Religare Enterprises is trading higher by 3% at Rs 324 on the Bombay Stock Exchange (BSE) after the financial services firm said the promoters of the company will sell 22.75% stake in the company to meet the Reserve Bank of India's (RBI) eligibility criteria for applying for a banking licence.

Vakrangee Softwares has surged 5% to Rs 78.75 after the company said its promoters have increased their holdings in the company by around 5 percentage points during past one month through open market transactions.

The market breadth in BSE remains positive with 904 shares advancing and 691 shares declining.