Mid Market-Sensex trims gains as Europe worries bite Analysis for May 17, 2012

The key domestic benchmarks pared gains in noon trade as the deepening worries over Europe"s debt turmoil came back to bite investors. Greece will hold elections next month amid growing speculation that the debt saddled economy is set for a Euro exit, deepening the region"s debt woes.

However, overall market sentiment was much improved today as the Sensex continued to trade above the baseline amid a rebound in the rupee and firm Asian market cues. Moreover, yesterday"s heavy sell-offs in stocks offered good buying opportunity at lower levels.

At 12:21PM, BSE SENSEX was at 16,134.34, up by 104.25 points or by 0.65 per cent and the NSE Nifty was at 4,895.85, up by 37.6 points or by 0.77 per cent.

The BSE Sensex touched intraday high of 16,240.18 and intraday low of 16,104.64 The NSE Nifty touched intraday high of 4,922.25 and intraday low of 4,878.6.

Meanwhile, the BSE MIDCAP was at 5,903.8, up by 24.38 points or by 0.41 per cent, while the BSE SMLCAP was at 6,303.16, up by 38.21 points or by 0.61per cent.

On the Sectoral front, FMCG and Realty advanced 1.97 per cent and 1.33 per cent, respectively.

The Market breadth, indicating the overall health of the market, was strong. On BSE out of total shares traded 3416, shares advanced were 1452 while 991 shares declined and 973 were unchanged.

The top gainers of the BSE Sensex pack were ITC Ltd. (Rs. 234.25,+2.72%), DLF Ltd. (Rs. 186.30,+2.62%), Housing Development Finance Corporation Ltd. (Rs. 634.50,+2.16%), Jindal Steel & Power Ltd. (Rs. 459.50,+1.75%), HDFC Bank Ltd. (Rs. 503.80,+1.75%), among others.

Most Asian markets rebounded from a four-month low on Thursday amid signs of a pickup in global economic recovery. Sentiment was boosted after industrial output in the US rose by 1.1 per cent in April 2012, the fastest pace since December 2010, signaling a pickup in the nation"s economic recovery and boosting the outlook for Asian exporters. Moreover, minutes from the Fed meeting showed that the central bank may resort to further monetary easing to boost US economic growth. Shanghai Composite was up 1.51 per cent, Hang Seng was up 0.37 per cent and Nikkei 225 advanced 0.86 per cent at 12:29 PM IST.