Sensex up 326 pts, Nifty gains 100 pts; ITC remains weak

Banks, oil & gas, metals and tech stocks are holding up the indices while realty stocks are under heavy selling pressure. BHEL, Tata Motors, Bharti Airtel, Hindalco and ICICI Bank are top gainers in the Sensex. While index heavy ITC is still down around 1 percent.

The market is once again firing away with strong gains as the Sensex is up 337.86 points or 1.85 percent at 18572.52, and the Nifty up 105.85 points or 1.98 percent at 5447.30.

About 1291 shares have advanced, 839 shares declined, and 157 shares are unchanged.

Banks, oil & gas, metals and tech stocks are holding up the indices while realty stocks are under heavy selling pressure. BHEL, Tata Motors, Bharti Airtel, Hindalco and ICICI Bank are top gainers in the Sensex. While index heavy ITC is still down around 1 percent.

Raghuram Rajan's taking over as the next RBI governor seems to be boosting the market for now. Former deputy governor Subir Gokarn says Rajan won't lessen RBI's focus on inflation but he may look for new ways to encourage dollar flows.

HSBC services PMI stays below 50 in August

Business activity (47.6 vs. 47.9 in July) stayed below the 50 mark in August led by a further decline in new business flows

Services sector activity remained below the 50 mark in August as macroeconomic uncertainty and tighter financing conditions continued to dent new business flows and business confidence, HSBC Global Research said in its report today.

Inflation picked up largely due to the depreciation of the rupee leading to higher imported inflation. Looking ahead, the weak spell is set to continue as the RBI will need to keep currency stabilisation measures in place and macroeconomic uncertainty persists.

Business activity (47.6 vs. 47.9 in July) stayed below the 50 mark in August led by a further decline in new business flows (46.6 vs. 47.6 in July) and fall in business expectations (63.7 vs. 67.5 in July).

The composite index for services and manufacturing (48.2 vs. 49.6 in July) fell further. Outstanding business (48.9 vs. 50.7 in July) declined in line with the weaker order flows, and employment (50.1 vs. 51.7 in July) was broadly flat.
Both input prices (55.3 vs. 52.5 in July) and prices charged (51.1 vs. 50.7 in July) picked up. The economy's largest sector, services, is losing traction, having seen activity contract for two straight months. Growth is being weighed down by the tighter financial conditions on the back of RBI's currency stabilization measures and capital outflows. Moreover, heightened macroeconomic uncertainty is dampening consumer and business sentiments.

These factors are expected to weigh on growth in coming month. Feeble signs of recovery may materialise during the final quarter of the fiscal year as macroeconomic uncertainty gradually recedes and confidence reluctantly recovers. By that time, we may also have some traction on stalled investment projects.

However, the outlook is tainted with downside risks, which could materialize if politics get in the way of meaningful macroeconomic and structural policy responses.

Services sector contracted for the second month in a row led by depleting orders and weakening sentiments. The weak run is set to continue with macroeconomic uncertainty and tighter financial conditions weighing on growth.

M&M earmarks investment of Rs 10,000 crore for next three years

Mahindra and Mahindra (M&M) has earmarked an investment of Rs 10,000 crore in the next three years on capex and launching new products. As part of overall capex, the company is developing two-three new platforms for brand new products, which will enter the market around FY 2016.

These products will be rolled out from completely new plant, the location for which, including options outside its Chakan plant in Maharashtra, will be decided within this fiscal. Earlier, the company had decided to put on hold all investment at its Chakan plant due to VAT refund issues with Maharashtra Government.

Mahindra & Mahindra (M&M) is the flagship company of the Mahindra Group, a multinational conglomerate based in Mumbai, India. Amongst the various business interests of its parent group, the company is mainly involved in the automobile manufacturing. It is one of the leading auto companies of India.

Sensex gains 354 points during pre noon trade

After plunging 650 points a day ago, a benchmark index of Indian equities markets on Wednesday surged by 354.32 points or 1.94 per cent during pre-noon trade.

The rally was led by oil and gas, metal, auto, banking index (bankex), consumer durables, public sector undertakings (PSU), IT, healthcare and capital goods sectors. However, fast moving consumer goods (FMCG) and realty sectors were trading marginally down.

The 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE), which opened at 18,314.68 points, was trading at 18,588.98 points in the pre-noon session, up 354.32 points or 1.94 per cent from the previous day’s close at 18,234.66 points.

The Sensex touched a high of 18,607.23 points and a low of 18,188.43 points during the trade so far.

The BSE oil and gas index surged 248.48 points, metal index swelled by 217.19 points, auto index moved up by 273.24 points, bankex gained 245.23 points, consumer durables increased by 122.74 points, PSU index inched up by 104.07 points, IT index gained 156.70 points, healthcare index augmented by 172.20 points and capital goods index went up by 122.35 points.

However, FMCG index dropped by 5.35 points and realty index went down by 10.55 points.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) was also trading 105.10 points or 1.97 per cent up at 5,446.55 points.

Crude oil futures slip to Rs 7,392 per barrel

Crude oil futures prices fell 1.82 per cent to Rs 7,392 per barrel today, after speculators reduced their exposures amid a mixed trend in Asian trade.

On the Multi Commodity Exchange, crude oil for delivery in October fell Rs 137 or 1.82 per cent to Rs 7,392 per barrel in 1,246 lots.

Similarly, the oil for September delivery moved down by Rs 132 or 1.76 per cent to Rs 7,375 per barrel in a turnover of 12,442 lots.

Analysts said the fall in crude oil futures was mostly in tune with a mixed trend in the Asian region as concerns over a US-led military strike on Syria returned.

Meanwhile, West Texas Intermediate (WTI) crude for October delivery eased 26 cents to $108.28 per barrel on the New York Mercantile Exchange in the mid-morning trade.

Jindal Steel increases price of steel plates by about Rs 2,500 per tonne

Jindal Steel and Power (JSPL) has raised the price of steel plates by about Rs 2,500 per tonne. The company also increased prices of wire rod and rebars by about Rs 2,000 and Rs 1,500 per tonne respectively. The company has raised the same due to sharp fall in Indian rupee against the US dollar in past two months.

JSPL is a part of Jindal Group and is a leading player in Steel, Power, Mining, Oil & Gas and Infrastructure. The company produces economical and efficient steel and power through backward integration from its own captive coal and iron-ore mines and passes on the benefits to its customers.

SAIL hikes product prices by Rs 1,700-1,750 per tonne: Report

Steel Authority of India (SAIL) has reportedly hiked prices by about 3-4 per cent for the current month. The company has hiked prices in the range of Rs 1,700-1,750 per tonne for HR-coil and CR-coil, while the company has raised long steel products price by about 1,000 per tonne.

The sharp fall of rupee against other currencies, mainly the US dollar, rise in oil prices and transportation costs are some of the major reason for the hike.

Recently, the company registered 16% growth in sales during the month of August ’13 by selling 10.86 lakh tonnes (LT) of steel products as compared to 9.38 LT in corresponding period last year (CPLY).

RBI permits Kotak Mahindra Bank to raise FII limit to 37%

Reserve Bank of India (RBI) has allowed Kotak Mahindra Bank to raise the purchasing limit of foreign institutional investors (FIIs) in the company by up to 37% of the paid up capital. As of June quarter 2013, FIIs had holding of 31.21% in the company, as per data available on the BSE.

India’s Apex Bank’s approval to the bank for raising the FII investment limit, is subject to the condition that aggregate foreign investment in the bank will not exceed the composite sectoral cap of 74% (49% under automatic route and up to 74% under government route).

However, RBI has curbed the purchase limit of equity shares by a single FII/SEBI, approved sub-account of a registered FII in Kotak Mahindra Bank, to 10% of the paid-up equity capital of the bank.

SBI share price reflects state of banking in India

The going gets tough for the country's largest bank as balance sheet is deteriorating at rapid pace

Share price of the country’s largest lender, State Bank of India, has fallen by 26% to Rs 1,475 since July. Unlike many other heavyweights which have become attractive after the recent beating, not many believe that SBI’s shares are attractive. The ratio of impaired loans for the entire banking sector has jumped 75 basis points to 10% at the end of June. If this be the case, then it is only going to get tougher for the country’s largest lender.

With the Reserve Bank of India’s recent tightening and economic growth plummeting to 4.4%, the banking sector’s woes are expected to rise. Morgan Stanley expects impairments to be meaningfully higher than their base case estimate of 12.5% by FY15. Given that companies will continue to struggle in a difficult macro-economic environment, analysts expect corporate lenders to struggle going forward.

SBI’s first quarter performance provides evidence of such a trend playing out. In the first quarter, SBI shocked the market with its slippage (fresh accretion of bad loans) of Rs 13,760 crore, which was way ahead of the market estimates. Even though SBI indicated that in the next quarter slippages to the tune of Rs 2,000-2,500 crore may be upgraded, analysts believe that the process may be slower than expected.

The management has not given any guidance for slippages in the current fiscal as it believes that asset quality pressures will persist due to the slowdown. According to Antique Stock Broking, the bank’s total restructured book stood at 3% of advances at the end of the first quarter and the corporate debt restructuring pipeline is at Rs 10,000 (related to iron & steel, road and power sector) for 2QFY14.

The bank’s profitability is also expected to take a hit in the coming quarters on rising expenditure and higher bond yields.

Morgan Stanley does not expect the bank’s average profit after tax over the next three quarters to be materially higher than Rs 2,000 crore.

“This will be driven by weaker asset quality (51% coverage and huge impaired loan formation); likely fall in net interest margins (falling spreads/loan-deposit ratio); rising opex and higher bond yields (MTM losses of Rs 1,300 crore according to management).”

Jet-Etihad deal to be completed by September 20

Media reports said that the deal will see an inflow of $379 million (Rs 2,500 crore).

Etihad is planning to complete acquisition of a 24% stake in Jet Airways by September 20 as all regulatory clearances are expected to be in place, according to reports.

Media reports said that the deal  will see an inflow of $379 million (Rs 2,500 crore).
Cabinet Committee on Economic Affairs (CCEA)  cleared a proposal for additional air services between India and Abu Dhabi.

Earlier On April 24,Jet announced its deal with Etihad.
The deal has received approval from Foreign Investment Promotion Board (FIPB), the central government agency and from the Cabinet Committee on Economic affairs.

United Spirits rally on Morgan Stanley stake buy

Morgan Stanley acquired 350,000 shares of United Spirits through open market purchase

United Spirits has rallied 5% to Rs 2,389, extending its past four day’s rally, after Morgan Stanley acquired additional stake in the company through open market purchase.

The stock opened at Rs 2,272 and touched high of Rs 2,399 on BSE. A combined 544,403 shares change hands on the counter till 1100 hours on BSE and NSE.


Morgan Stanley Asia (Singapore), Morgan Stanley India Capital Private Limited and Morgan Stanley & Co. International plc, have purchased 350,000 shares of the company through market purchase on August 29, United Spirits said in a regulatory filing.

India slips to 7th rank in global coffee production

Despite increasing production, India was pushed below small countries like Republic of Honduras

India's  ranking among major coffee producing countries has slipped to 7th position despite increasing production, albeit marginally, in 2012. It stood in the 6th position in the previous year.

In 2012, the coffee output in India increased 0.48% to 5.25 million bags (each bag = 60
kilograms) compared to 5.23 million bags in the previous year. With this, India’s share in global coffee production stands at 3.6%, while Honduras’ share is 3.7%.

Republic of Honduras, the Central American country, which was behind India till 2010, has improved its ranking to climb the 6th position even after recording 5.35% drop in production to 5.4 million bags from 5.7 million bags in the previous year.

According to International Coffee Organisation (ICO), the total coffee production in the world increased 7.18% to 144.06 million bags as against 134.41 million bags in the previous year. Brazil reported an increase of 7.3 million bags to 50.8 million bags, Indonesia gained 2.3 million bags to touch 10.9 million bags, Ethiopia added 0.5 million bags to 6.5 million bags.

The area under coffee planting and bearing area in India has shown an upward trend, due to the expansion of cultivation in non-traditional areas. This suggests that growth in production was on account of area increase rather than productivity increase. As per FAO (Food and Agriculture Organisation), yield level in India at 837.8 kg per hectare in 2011 was much below the Vietnam yield levels of 2,187.9 kg per hectare and Brazil’s 1,256.7 kg per hectare.

Interestingly, a comparison of productivity levels in 1971 vis-à-vis 2011 clearly suggest that India (-2.72%) and Indonesia (-13.01%) are the only two countries that have reported decline in the yield levels in the last 40 years. Lower productivity in India is due to limited mechanisation, pest infestation and labour shortage.

“Relatively better coffee prices have prompted the growers to follow better agronomic practices and thereby higher crop production. But on the productivity side much more needs to be done and towards this concerted efforts are required, both at the policy level and at farm level,” said the latest annual report of United Planters’ Association of Southern India (Upasi).

Upasi is the apex body of four major plantation crops like coffee, rubber, spices and tea in South India.

Among the countries ahead of India, only Vietnam reported a decline of 2.1 million bags to touch 22 million bags of coffee production in 2012. Also, most of the Central American countries reported lower crop.

“The crop decline was due to pre-seasonal rains during the coffee blossoming period, while in Central America, the outbreak of coffee leaf rust was considered to be the worst ever recorded.

Production was severely affected and its likely impact on the forthcoming crop is also anticipated to be worse”, the Upasi report said.

The damage caused by coffee leaf rust in Central America was compensated by record production from Brazil, which also ensured its undisputed reputation in the world coffee scene with a share of 35.3%. Brazil was followed by Vietnam in the second position with 15.3%, while Indonesia retained its third slot by improving its share at 7.6%.

In Colombia, the coffee industry is still experiencing difficulties, particularly as a result of the outbreak of the coffee berry borer, which may further delay a return to the country’s normal production levels.

“The production prospects for 2013 season are somewhat mixed due to the changes in the weather pattern across major exporting countries, which may have an adverse effect on the final crop. In Brazil, the crop is anticipated to be record higher for an off-year in the biennial cycle, and as per the CONAB, the Brazilian crop forecasting agency, the crop is anticipated to be in the region of 46.98 million bags to 50.4 million bags,” the Upasi report said.

Rupee sheds 60 paise to 68.25 in early trade

The rupee shed 60 paise to 68.25 per dollar in the opening trade against the previous close of 67.65 due to heavy capital outflows and fears of a downgrade by rating agencies.

S&P, Fitch and Moody’s have aired their concerns in recent weeks, as the slowdown in growth threatens to derail the fiscal austerity plans.

On Monday, S&P put India’s chances of a downgrade higher than Indonesia. This has elicited concerns among market investors.

According to forex dealers, besides a rating downgrade, threat of the Syrian war put pressure on the rupee. “There were no inflows and concerns over sovereign rating downgrade amid Russia’s defence minister’s statement triggered heavy sell-off in the forex market,” said a dealer with a public sector bank.

The Reserve Bank of India’s special dollar window for oil retailers had last week helped ease the offshore non-deliverable forward (NDF) contracts thereby limiting the losses due to speculation in the currency market.

However, this did not help as lower GDP and manufacturing sector growth data subdued investor sentiments yet again.

The rupee had touched a historic low of 68.80 against the US dollar on August 28.

Radhika Rao, Economist, DBS said, “Signs of trouble have sprouted of late. Since late May 13, the currency has depreciated sharply, pulling down the equity and bond markets in unison. The liquidity measures to support the currency instead intensified growth risks and narrowed the scope for the monetary policy to assume a growth supportive stance. In the meantime, the stark rupee decline is feeding into inflation and raising the imported fuel costs.”

She added: “Risks of a move to sub-investment rating are likely to resurface in late 2013 or early 2014 as pre-election spending has ramped up further and political worries heighten.”

Call rates, Govt bonds

The inter-bank call money rate, the rate at which banks borrow money from each other to meet their short-term fund requirements, opened higher at 10.25 per cent from its previous close of 10.10 per cent.

The 7.16 per cent government bond, which matures in 2023, opened lower at Rs 90.4 from Monday’s close of Rs 90.75. Yields jumped to 8.63 per cent from 8.58 per cent.

Hero MotoCorp’s Haridwar plant resumes operations on September 3rd

MotoCorp’s Haridwar plant has started production on September 3, 2013, after three days of shutdown. Its workers were protesting against suspension of one of their colleagues and went on strike from August 31, 2013. The company has taken the undertakings from the permanent workers about not involving in any kind of protest.

Hero MotoCorp is the World's single largest two-wheeler motorcycle company. Honda Motor Company of Japan and the Hero Group entered a joint venture to setup Hero Honda Motors in 1984. Hero Honda Motors changed its name to Hero MotoCorp following the exit of its erstwhile Japanese promoter, Honda, from the company.

Tata Steel receives orders for more than 200 samples of its perforated armour steel

Tata Steel has received orders for more than 200 samples of its perforated armour steel, which has been exported to a number of countries worldwide, including Germany, France, the USA and India. This revolutionary armour steel, formerly known as Super Bainite, has also undergone a number of design improvements and has taken on a new brand name, PAVISE SBS 600P.

The company will be exhibiting its PAVISE product at next week’s DSEI show, the world-leading defence and security event, which runs from September 10-13 at the ExCel London exhibition centre.

PAVISE, which provides an efficient and cost-effective armouring solution for military vehicles, as well as for defended infrastructure such as watch towers or sangars, has now been tested up to STANAG Level 4 to create armour capable of resisting both small arms and heavy machine gun fire with armour-piercing projectiles.

Strides gains as govt clears Mylan's Rs 5,168-cr deal to buy unit

Strides Arcolab has opened higher by 3% at Rs 919 on reports that the government cleared the Rs 5,168-crore deal of the US-based Mylan Inc for acquiring the company’s unit Agila Specialties.

The acquisition of Agila Specialties, the injectible medicine business of Strides, however, is subject to certain conditions.

After the completion of acquisition process, Mylan has to maintain the investment level in R&D in value terms for five years at absolute quantitative level at the time of induction of foreign direct investment (FDI), the PTI reports suggests.

The stock hit a high of Rs 929 and low of Rs 893 so far on BSE. A combined around 85,000 shares change hands on the counter in opening deals on BSE and NSE.

Torrent Power to purchase natural gas directly from Petronet LNG

In a bid to feed its station, Torrent Power is all set to purchase natural gas directly from Petronet LNG. This is first of its kind of arrangement. Meanwhile, the company has laid an independent pipeline and has asked for small volumes initially around 0.05 million tonnes. Petronet is an importer of natural gas and currently operates two terminals at Dahej and Kochi.

Torrent Power is engaged in generation, transmission and distribution of power. The company generates 400 MW from its coal-based thermal power station located at Sabarmati.

Tata Power bags several recognitions at CCQC 2013

Tata Power, the country’s largest integrated power company, was awarded several recognitions at the Chapter Convention Quality Circle (CCQC) 2013 organized by the Quality Circle Forum of India (QCFI) at IES college, Mumbai.

Recognized as a pioneer in the power sector, the company has been honoured with 36 awards. In its constant endeavour to enhance efficiency and establish quality benchmarks, Tata Power has ensured constant improvement and innovation across its operations.

The entries comprised of 28 Quality Circle teams and 65S teams from Mumbai operations which presented Quality Circle and 5S projects. There were a total of 211 participants including delegates at the CCQC - 2013.

LIC Housing Finance unveils two new home loan schemes

LIC Housing Finance (LICHFL), the home-loan arm of the country’s largest insurer, Life Insurance Corporation of India (LIC), has launched two new home loan schemes, ‘Bhagyalaxmi Plus’ and ‘New Fixed 10’ on September 03, 2013.

Under Bhagyalaxmi Plus scheme, home loans will be given to those women who will be the sole owner or first owner to buy a property, at a fixed rate of interest of 10.35% for loans up to Rs 75 lakh for the first two years, and floating rate thereafter. Moreover, borrowers would get a discount of 0.25% throughout the loan term on conversion to floating rates.

Besides, the ‘New Fixed 10’ scheme comes with fixed interest rates for 10 years, out of which first 5 years would carry a rate of 11.50%, for loans up to Rs 75 lakh. The scheme offers customers the flexibility to exercise an option after 5 years to convert their loan into floating rates prevalent at that time.

Gujarat Gas Company jumps on inking MoU with GSPC for long term gas supply deal

Gujarat Gas Company and Gujarat State Petroleum Corporation (GSPC) have entered into a Memorandum of Understanding (MoU) on the September 03, 2013 for a long term gas supply deal. As per the MoU, GSPC has agreed to supply 0.85 mmscm of gas per day to GGCL from January 01, 2014 to June 30, 2025.

Price of gas will be determined in the relevant Gas Sales Contracts (GSC) and it is expected to be formula based. The MoU is effective till December 31, 2013 or the signing of the relevant GSCs, whichever is earlier.

Gujarat Gas, a 65.12 per cent subsidiary of BG Asia, is India’s largest private sector natural gas distribution company in terms of sales volumes, with operations in Gujarat. The company distributes natural gas to domestic, commercial and industrial consumers, and compressed natural gas as automobile fuel, in the cities of Surat, Ankleshwar, Bharuch, and surrounding areas.

Sebi revises circuit breaker rules

SEBI has revised the rules for circuit breaker-induced trading halts for India's two main equity indexes, aiming to contain volatility.

Stock exchanges would now calculate 10%, 15% and 20% circuit breaker limits of market-wide index variation based on the previous day's closing levels on the Sensex and the Nifty.

Currently, the NSE and BSE exchanges calculate an absolute value for the circuit breaker limit using the 10, 15 and 20% price band movement based on the index's quarter-end closing level.

Resumption of trading after a halt triggered by the circuit breaker would now be followed by a 15-minute pre-open call auction session, the Securities and Exchange Board of India (SEBI) said in a circular on Tuesday.

The new rules will come into effect on October 1.

Markets open on a strong note as heavyweights gain

Infosys, Reliance Industries, Tata Motors and TCS among the top gainers in opening trades

After a momentary tick in the red, the markets gained in the opening trades on account of gains in heavyweight names like Infosys, Reliance Industries, Tata Motors and TCS.

At 1918 hrs, the Sensex was up 86 points at 18,321 and the Nifty gained 25 points to trade at 5,366.

In the broader markets, the mdicap index was up 0.4% and the smallcap index gained 0.2%, both underperforming the BSE benchmark index which gained 0.6%.

In Asia, stocks snapped a four-day winning streak on Wednesday and safe assets like gold consolidated chunky overnight gains after President Barack Obama clinched the backing of two key figures in Congress in his drive for limited U.S. strikes on Syria.

MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.5% after four days of gains. Philippines and Indonesia's stocks led declines in the region.

The Nikkei average retreated from a near three-week high on Wednesday morning, hit by profit-taking after recent big gains, with many investors on the sidelines ahead of key events in coming days.

The benchmark Nikkei shed 0.8% at 13,869 in midmorning trade, after advancing 4.4% the past two sessions.

Raghuram Rajan to take over the helm of India’s central bank

Former chief economist with the International Monetary Fund (IMF) and economic advisor to the Finance Ministry, Raghuram Rajan, is all set to take over the reins of RBI from his predecessor Duvvuri Subbarao, as twenty-third Governor of the central bank at a time when the country is facing huge economic stress, with rapid fall in rupee, high inflation, low growth and yawning current account deficit (CAD).

Acknowledging the difficult situation that the country is in Rajan, already playing safe, has said that he has no magic wand to face the challenge before the country and would deal the challenges one by one. However, the Government, which had a hard time during Subbarao's tenure, owing to his unrelenting focus on inflation control at the cost of low interest rates, is already counting on the new RBI governor and expecting the new incumbent to reverse some of those stiff policies.

Further, the markets are also waiting to see whether the new governor will come out with fresh policy announcements like Bank of Japan Governor Haruhiko Kuroda, who launched a massive stimulus package within weeks of taking office earlier this year. Another factor which the markets would watch out for will be of Rajan’s plan to dismantle any of the mishmash of measures, including a hike in short-term interest rates, which the central bank has unveiled since mid-July to prop up the rupee.

Rajan, who was appointed as the Chief Economic Advisor in the Finance Ministry in August last year, would bring to RBI a vast experience gained at the IMF and during the brief stint in the government. The new governor is expected to have enough ideas and solutions to many of the problems, which include not just the currency, but also financial inclusion along with growth.

Rajan, who has being heralded as the savior the country needs, was acclaimed for predicting the 2008 global financial crisis. In 2005, he had delivered a lecture critical of the financial sector, arguing that a financial disaster might be looming, which holds true in the current scenario.

Shares may open lower on Syria woes

At 800 hrs Indian Standard Time the SGX Nifty was up 21 points at 5,342.

  Markets are likely to open weak tracking negative Asian cues.

Sensex fell nearly 4 percent yesterday, retreating from a 2-1/2 week closing high in the previous session, as blue chip shares slumped as fears of military tensions in the Middle East roiled global markets.

Investors are now anxiously waiting for any fresh measures with Raghuram Rajan taking over the reins of RBI as the new governor on September 5.

At 800 hrs Indian Standard Time the SGX Nifty was up 21 points at 5,342.

US stocks rose on Tuesday but were far off session highs after top Republicans voiced support for U.S. President Barack Obama's call for military strikes against Syria.

The Dow Jones industrial, Standard & Poor's 500 and Nasdaq Composite Index was up 0.2-1%.

Asian stocks faltered on Wednesday, while oil and gold held on to overnight gains after President Barack Obama clinched the backing of two key figures in Congress in his drive for limited U.S. strikes on Syria.

MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.2 percent, following four days of gains. Tokyo's Nikkei slipped 0.6 percent.

STOCKS TO WATCH

Gujarat Gas Company has signed a memorandum of agreement with Gujarat State Petroleum Corporation Limited for long term gas.

Wipro has bagged a multi-year contract from Deutsche Bank valued around $125 mn.

SAIL, Essar Steel, JSPL and JSW Steel have raised prices by up to Rs 2,500 per tonne for this month due to sharp increase in input costs.

TCS has bagged a multi-million euro deal from Norwegian firm DNB.

The government has approved 17 foreign direct investment (FDI) proposals totalling Rs 992.61 crore, while recommending the Rs 2,058 crore Jet-Etihad deal for final clearance to the Cabinet.