Markets trim gains, IT tumbles

Key share indices have trimmed the gains and are trading marginally positive. Investors remain cautious ahead of key FDI vote in Parliament later today that will test the Congress-led UPA government's ability to push through key reforms.

At 13:00 PM, the Sensex was at 19,408, up 60 points and the Nifty gaining 13 points at 5,901.

On the global front, Asian shares rose on Wednesday, led by surging Chinese equities, but concerns over whether US lawmakers can break a budget impasse before year-end to avert a possible economic slump weighed on sentiment. Hang Seng, Nikkei, Kospi, Taiwan, Strait Times and Shanghai Composite have gained between 0.4-3%.

Back home, India's services sector grew at its weakest pace in over a year during November due to slowing orders, a survey showed on Wednesday, suggesting an economy limping towards its slowest full-year growth in a decade was struggling to refind momentum.

The HSBC services Purchasing Managers' Index, based on a survey of around 400 companies, fell to 52.1 in November from October's 53.8, to register a 13-month low.

The rupee today rose by 20 paise to 54.48 against the dollar in early trade at the Interbank Foreign Exchange market on continued selling of the US currency by exporters and banks.

On the sectoral front, BSE Metal and Realty indices have surged by nearly 2% each followed Capital Goods, Oil & Gas, Auto, PSU and FMCG, all gaining by nearly 1% each. However, BSE IT and TECk indices have declined by almost 1% each.

Shares of metal companies are trading higher by up to 3% on reports of higher demand from China, the world's largest consumer of copper and aluminum.

Sterlite Industries, Tata Steel, Sesa Goa and Hindalco Industries are trading higher by more than 2% each, while JSW Steel, SAIL and Jindal Steel and Power are up 1-2% on the Bombay Stock Exchange (BSE).

From the Capital Goods space, BHEL and L&T have gained between 0.3-1%.

Banks which are a proxy to the economy are also trading higher. SBI and HDFC Bank have gained between 1-2%.

Index heavyweight Reliance Inds have extended yesterday’s gain and is up over 1%. Reliance Industries today said it has completed sale of its 25 per cent stake in an oil block in Yemen to Indonesia's Medco Energi for about $90 million. ONGC has gained nearly 1%.

Other prominent gainers include Tata Motors, Hero Moto, ITC and GAIL.

On the losing side, Indian IT shares down on fears that Cognizant Technology Solutions Corp may issue lower revenue growth guidance for 2013 based on compensation targets for top executives, dealers said. Infosys, Wipro and Tata Consultancy Services have dipped between 0.2-2%.

Among other shares, Venus Remedies has surged 7% to Rs 319 after the company said it has got an approval from the Drugs Controller General of India (DCGI) to conduct Phase-III clinical trials of its cancer detection New Chemical Entity (NCE) which will involve an investment of $1 million.

MRF is trading higher by around 5% at Rs 11,700, also its record high on the Bombay Stock Exchange. The stock of tyre maker outperformed the market by gaining 16% in past one week compared to 3% rise in benchmark Sensex, after the announcement of September quarter earnings.

Sundaram Finance has rallied over 7% at Rs 1,081 after the company fixed December 14, 2012 as record date for the proposed 1:1 bonus issue.

Meanwhile, BSE Midcap index has gained 0.68% whereas BSE Smallcap index is up 0.8%.

The market breadth in BSE remains healthy with 1,601 shares advancing and 1,089 shares declining.