Indian equity markets open in green

Tue, 19 Jun 09:30 am

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Asian equity markets have opened the day on a mixed note with markets in Hong Kong (down 0.3%), China (down 0.5%) and Japan (down 0.3%) leading the losses in the region. However, markets in Singapore (up 0.7%) and Malaysia (up 0.7%) were trading in green. The Indian equity market indices have opened the day on a positive note. Sectoral indices are trading mixed with stocks in the energy and FMCG space leading the gains while stocks in the banking and realty sectors are witnessing selling pressure.

The Sensex today is up by around 48 points (0.3%), while the NSE-Nifty is up by around 9 points (0.2%). Mid cap stocks are trading in the red with the BSE Mid Cap index down by around 0.1%. However, BSE Small Cap index was up by around 0.1%. The rupee is trading at Rs 55.98 to the US dollar.

Engineering stocks have opened the day on a mixed note with Ingersoll Rand and Siemens Ltd leading the gainers while Honeywell Automation and Punj Lloyd Ltd are trading weak. As per a leading financial daily, Bharat Heavy Electricals (BHEL) will now have to compete with four other companies for Rs 120 bn Engineering, Procurement and Construction (EPC) tender. This is because the Rajasthan government has re-invited bids for the same. BHEL had bagged the tender for two separate thermal power projects in Rajasthan more than a year ago, however, it got scrapped. Earlier when the tenders were floated in November 2009 and opened in April 2010, there were three bidders - BHEL, BGR Energy and Russia's Power Machines. This time along with BHEL; Larsen and Toubro Ltd, Thermax and BGR Energy are expected to participate in the rebidding process. The stock of BHEL was trading in the red.

Oil and Gas stocks have opened the day on a mixed note as well. On one hand Oil India Ltd and Indraprastha Gas Ltd are trading in the green. On the other hand Cairn India Ltd. and Chennai Petroleum Corporation Ltd are trading in the red. Due to the huge difference in the prices of diesel and petrol, the demand for diesel in the country has shot up. So much so, that demand outstrips supply. As a result, most of the PSU oil refiners have been forced to buy diesel from Reliance Industries Ltd (RIL) and Essar Oil. As per a leading daily, the PSU oil firms, Hindustan Petroleum Corporation Ltd, Indian Oil Corporation and Bharat Petroleum Corporation Ltd are buying nearly 15 m tones of diesel per year from the two private refiners. The private refiners are able to charge diesel at international prices from the PSU refiners leading to huge windfall gains for the former. The government has tried to prevent and control the dieselization in the country through higher taxes on diesel driven vehicles. However, till such time as the price differential between the two fuels exists, this higher demand for diesel is expected to continue.