Market ends lower in choppy trade

Stocks ended volatile session with losses for the second straight day on sustained selling in IT and select blue-chip stocks. Ranbaxy Labs suffered over 10% on high volumes. The S&P CNX Nifty was up marginally. Fresh selling at day’s high in mid-afternoon trade derailed a sustained recovery from lower level in the day. Volatility was high in the later half of day. The market breadth was weak.
IT pivotals tumbled hit by sharp fall in American depository receipts (ADRs) on the New York Stock Exchange (NYSE) on Friday, 11 July 2008.
European stocks surged, boosted by a US plan to rescue embattled mortgage finance companies Fannie Mae and Freddie Mac and by a fresh surge of acquisition activity. Key benchmark indices in UK, France and Germany rose by 0.97% and 1.43%.
Political uncertainty will continue to weigh on the domestic bourses in the near term. The government is holding a two-day special session of parliament on 21 July 2008-22 July 2008 to seek vote of confidence after it was reduced to minority following withdrawal of support by Left parties on 8 July 2008. The government hopes to retain power due to backing from Samajwadi Party, a regional party in Uttar Pradesh.
The 30-share BSE Sensex was down 101.13 points or 0.75% at 13,368.72, as per provisional closing. The Sensex gained 87.36 points at day's high of 13,557.21 hit in mid-afternoon trade. At the day’s low of 13,270.40, the Sensex slipped 199.45 points in late trade.
The S&P CNX Nifty held firm and was up 2.40 points or 0.06% at 4,051.40, as per provisional closing.
The market breadth was weak. On BSE, 1587 shares declined, 983 advanced and 73 remained unchanged.
The total turnover on BSE amounted to Rs 4191 crore as compared to Rs 3073 crore by 14:30 IST
Oil, India's biggest import, was trading above $143 a barrel, but below a record high of $147.27 hit on Friday, 11 July 2008.
Among the 30-member Sensex pack, 15 advanced while the rest slipped.
India’s largest pharma company in terms of sales Ranbaxy Laboratories tumbled 10.83% to Rs 473.90 on 28.61 lakh shares. It was the top loser from Sensex pack. The stock was hammered on reports the US government has levelled serious allegations against the company. The US department of justice (DoJ) has said that there was evidence to suggest that Ranbaxy used active pharmaceutical ingredients (API) from unapproved sources, blended unapproved API with approved API, and used less-than-approved API at its Paonta Sahib (Himachal Pradesh) plant in its drugs, resulting in the sale of subpotent, super- potent or adulterated medicines in the US market.
In a statement, Ranbaxy strongly denied the allegations raised by the US Department of Justice (DOJ). The company also stated that its business in the US continues as normal. Ranbaxy also said the company's deal with Japanse drug maker Daiichi Sankyo is binding and final and remains on track.
IT stocks extended Friday’s losses after IT bellwether Infosys Technologies said on Friday, 11 July 2008, at the time of announcing Q1 June 2008 results that the business environment was tough. The stock plunged 6.95% to Rs 1559.90, after declining 7.18% on Friday, 11 July 2008.
At the time of announcing the Q1 results, Infosys revised earnings and revenue guidance upward for the year ending March 2009 (FY 2009). Infosys has forecast 24.4% to 26.6% growth in earnings per share as per Indian GAAP at between Rs 98.79 to Rs 100.51 in FY 2009 over the year ended March 2008 (FY 2008). It has forecast a between 27.5% to 29.5% growth in revenue at between Rs 21278 crore and Rs. 21622 crore in FY 2009 over FY 2008.
TCS (down 3.63% at Rs 770.10), Satyam Computer Services (down 7.60% at Rs 410.65), and Wipro (down 1.48% at Rs 406.20), slipped. The ADRs of Infosys (down 13.30%), Satyam Computer Services (down 9.17%) and Wipro (down 2.82%) slumped on the NYSE on Friday, 11 July 2008.
ITC (down 3.53% to Rs 168.30), HDFC Bank (down 3.23% to Rs 1033), and Hindalco Industries (down 2.90% to Rs 150.70) edged lower from the Sensex pack.
India’s top tractor maker Mahindra & Mahindra (M&M) surged 4.50% to Rs 554.90 on 25,411 shares. It was the top gainer from Sensex pack.
India’s largest state-run oil exploration company in terms of market capitalisation Oil and Natural Gas Corporation (ONGC) galloped 3.60% to Rs 879.85. The company is reportedly in talks with British firm Imperial Energy Corp to form an alliance which could include it buying an equity interest in the UK-based firm. If ONGC manages to strike a deal with Imperial Energy, it will strengthen the ONGC's overseas presence.
India’s largest private sector firm by market capitalization and oil refiner Reliance Industries rebounded from day’s low of Rs 1992.35. It was now up 2.11% at Rs 2059 on 12.03 lakh shares.
India's largest state-run bank by net profit State Bank of India vaulted 3.51% to Rs 1265.10 after touching a low of Rs 1205 in early trade. The bank is likely to report double-digit net profit growth in the Q1 June 2008, Chairman O.P. Bhatt told media reporters on Friday, 11 July 2008.
India's largest private sector bank by net profit ICICI Bank recovered from day’s low of 573.25. It settled with loss of 1.88% to Rs 580.40. Its American depository receipt (ADR) lost 7.4% on the New York Stock Exchange (NYSE) on Friday, 11 July 2008.
World’s sixth largest steel producer in terms of annual capacity Tata Steel surged 3.11% to Rs 686.90 on reports the company is looking at acquiring an iron ore mine in Western Australia to supply iron ore to Corus' plants.
NTPC (up 3.71% to Rs 167.90) and Ambuja Cement (up 2.61% to Rs 82.60) edged higher from Sensex pack.
Larsen & Toubro, the country’s largest state-run engineering firm in terms of outstanding order book position advanced 2.19% to Rs 2408.80, after sliding to a low of Rs 2320.20
India’s largest state-run engineering firm in terms of outstanding order book position Bharat Heavy Electricals fell 3.35% to Rs 1470.40 despite reports of the company is looking to acquire a locomotive manufacturing facility in Europe.
Debutante KSK Energy Ventures settled at Rs 190.50 on BSE, a discount of 20.63% over the initial public offer price of Rs 240. The stock debuted at Rs 220, a discount of 8.33% over the initial public offer (IPO) price. It hit a high of Rs 234.80 and a low of Rs 176 in the day.
Among the side counters, Selan Exploration (up 20% to Rs 216.80), Suzler India (up 13.81% to Rs 777.90), Saurashtra Cement (up 20% to Rs 32.85), surged
Most Asian markets, which opened before Indian markets, were trading lower today, 14 July 2008. Key benchmark indices in Hong Kong, South Korea, Japan Taiwan and Singapore were down by between 0.23% and 1.21%. However China’s Shanghai Composite gained 0.76%
US markets ended volatile session on Friday, 11 July 2008, with the Dow Jones falling below the 11,000 level for the first time since August 2006. Growing concern about the health of Fannie Mae and Freddie Mac send bank shares to an 11-year low. The Dow Jones Industrial Average slumped 128.48 points to 11100.54 and the Nasdaq Composite shed 18.77 points at 2239.08. The Standard & Poor's 500 index dropped 13.90 points to 1,239.49.
India's industrial production rose 3.8% in May 2008, much lower than revised 6.2% growth in April 2008, the government data released on 11 July 2008 showed. Industrial production growth for April 2008 revised downwards to 6.2% from earlier 7%.
The market slumped on Friday, 11 July 2008 as spiraling crude oil prices and weak economic data dampened investor sentiments. The 30-share BSE Sensex lost 456.39 points or 3.28% at 13,469.85 and the broader based S&P CNX Nifty was down 113.20 points or 2.72% at 4049, on that day.
The BSE Sensex rose 15.85 points or 0.12% to 13,469.86 in the week ended Friday, 11 July 2008. The S&P CNX Nifty edged up 33 points or 0.82% to 4,049 in the week.
Inflation based on the wholesale price index surged to a fresh 13-year high 11.89% in 12 months to 28 June 2008, above the previous week's annual rise of 11.63%, government data released on 11 July 2008 showed. This is much higher than the Reserve Bank's tolerance limit of 5.5% set for the current fiscal.
Source: Capital Market

Strong market breadth

The market ended a volatile session on a mixed note. The Sensex ended in the red while the Nifty ended unchanged. All sectoral indices on BSE barring BSE Metal index and BSE PSU index, were in the negative region. India's largest aluminium producer by sales Hindalco surged. Volatility was caused by uncertainty as to whether the government will be able to win vote of confidence in the parliament. Reports suggest that government may hold a special session of parliament on 20 July 2008-21 July 2008 to seek vote of confidence following withdrawal of support to the government by Left front this week. The government is confident of retaining power due to backing from Samajwadi Party, a regional party in Uttar Pradesh. Samajwadi Party (SP) yesterday, 8 July 2008, said it will vote with the government in support of the nuclear deal with the United States. Cues from global markets were mixed. In Europe, key benchmark indices in UK, France and Germany were down by 0.97% to 1.64%. Asian markets were mixed. Key benchmark indices in Taiwan, South Korea, Hong Kong and Japan were up by 0.07% to 1.19%. Key indices in Singapore, and China were down by 0.55% to 1.54%. As per provisional closing, the 30-share BSE Sensex lost 58.13 points or 0.42% at 13,906.13. It shed 200.32 points at the day’s low of 13,763.94 hit in afternoon trade. At the day’s high of 14,047.43, the Sensex gained 83.17 points in early trade. The broader based S&P CNX Nifty was unchanged at 4156.70. The BSE Mid-Cap index was down 0.10% at 5,465.17, while the BSE Small-Cap index was up 0.29% at 6,809.82. The market breadth was strong on BSE, with 1431 gainers as against 1194 losers. 71 stocks remained unchanged. BSE clocked a turnover of Rs 4807 crore as against Rs 5,093.01 on Wednesday, 9 July 2008. India's largest aluminium producer Hindalco surged 4.84% to Rs 152.75 and state-run National Aluminium Company jumped 9.07% to Rs 361.90 tracking London Metal Exchange aluminium futures which surged to a record high of $3,350 a tonne. ACC (up 3.51% at Rs 553), Ambuja Cements (up 2.46% at Rs 79), and Reliance Infrastructure (up 2.25% at Rs 854.90), were the other prominent Sensex gainers. World’s sixth largest steel maker Tata Steel rose 3.11% at Rs 698.20 on reports the company plans to list a holding firm for steel and raw material assets outside India, on the London Stock Exchange to raise funds for acquiring iron ore and coal mines. India’s largest real estate developer by market capitalization DLF rose 1.40% to Rs 456.60 after the company today said it has set aside Rs 1100 croer for buyback of shares at a maximum price of Rs 600 a share. India's second largest software exporter by sales Infosys Technologies fell 0.61% at Rs 1810. The company will declare Q1 June 2008 results on Friday, 11 July 2008. The key thing that analysts and market men will be looking at is whether Infosys revises its year ending March 2009 (FY 2009) guidance given at the time of announcing the year ended March 2008 (FY 2008) results in April 2008. Some analysts expects Infosys to revise the guidance upwards due to good Q1 June 2008 results and also to factor in sharp fall in rupee against the dollar. Infosys had given FY 2009 guidance based on a rupee/dollar rate of 40.02. Rupee is currently hovering at below 43 a dollar. India’s largest private sector bank by market capitalization ICICI Bank fell 1.43% at Rs 613. India’s largest private sector firm by market capitalization and oil refiner Reliance Industries declined 1.97% at Rs 2039. Real estate developer DS Kulkarni Developers surged 5.04% to Rs 100.10 after the company said it has sold 50% in a unit that is setting up a premium Bangalore residential project to ICICI Prudential PMS Real Estate Portfolio, for Rs 35 crore. Engineering and construction firm Petron Engineering Construction spurted 6.74% to Rs 209.90 after the company said on Wednesday, 9 July 2008, it has received letters of intent for four power project works in Uttar Pradesh, totally worth Rs 14.07 crore. Aluminium producer Madras Aluminium Company jumped 11.41% to Rs 741.50 after the company fixed 24 July 2008 as record date for a 5-for-1 stock split. IT services firm Allied Digital Services moved up 7.02% to Rs 890 after company acquired 80.5% in infrastructure management business of US-based EnPointe Technologies for $30 million. Paint maker ICI India rose 1.94% at Rs 538 after the company said its board will meet on 17 July 2008 to consider extending the share buyback scheme, at a price of up to Rs 575 each. Tyre maker JK Tyre & Industries slipped 2.44% to Rs 92 on reports that it has raised truck tyre prices by 6% effective yesterday, 9 July 2008, in the wake of rising input costs. Two and three wheeler maker Bajaj Auto gained 14.23% to Rs 515. The company reported 4.37% fall in net profit to Rs 175 crore on a 9.24% rise in total income to Rs 2340 crore in Q1 June 2008 over Q1 June 2007. As per reports, Bajaj’s quarterly figures were higher than expectations. US stocks plunged yesterday, 9 July 2008 with financial stocks taking the biggest hit as concerns over the credit crisis took the spotlight again, sending cautious investors to the sidelines. The Dow Jones industrial average plunged 236.77 points, or 2.08%, to 11,147.44. The Standard & Poor's 500 index lost 29.01 points, or 2.28%, to 1,244.69, while the Nasdaq Composite index declined 59.55 points, or 2.60%, to 2,234.89.

Source: Capital Market

Rally in heavyweights brings Sensex close to 14,000

The market snapped yestaerday’s fall on strong global cues and on sharp fall crude oil prices on Tuesday, 8 July 2008. The market was also boosted on hopes the government may push through some of the economic reforms which Left parties had stalled over the past four years. Today's sharp surge took Sensex within striking distance of 14,000 mark. Reliance Infrastructure and Jaiprakash Associates rose more than 10% each. Index heavyweights Reliance Industries and Infosys spurted. Back home, over the last four years, Left parities had stalled privatisation of state-run firms, pension reforms, higher foreign limits in insurance and more liberal norms for foreign bank. Left parties on Tuesday said they are withdrawing support to the Congress-led United Progressive Alliance government to protest Indo-US nuclear deal. The government is expected to face a vote of confidence in parliament in the coming weeks. The government is confident of retaining power due to backing from Samajwadi Party, a regional party in Uttar Pradesh. Samajwadi Party (SP) yesterday, 8 July 2008, said it will vote with the government in support of the nuclear deal with the United States. All the sectoral indices on BSE were in green. All the Sensex stocks were in positive zone. The market breadth was strong as buying was witnessed across the board. Realty, banking, capital goods and power stocks surged. The 30-share BSE Sensex provisionally ended up 641.76 points or 4.81% at 13,991.41. At the day’s high of 13,998.48 hit during late trade Sensex gained 648.83 points. The broader based S&P CNX Nifty was up 175.4 points or 4.4% at 4,163.95 as per the provisional figures. Earlier in the day, the market had pared some of earlier strong gains after a report that Iran had test fired missiles, raised fears about a jump in oil prices. Europen markets which opened after Indian markets were firm. Key benchmark indices in France, Germany and UK were up by between 1.18% to 1.49%. Asian markets which opened before Indian market turned mixed in contrast to a broad-based initial surge after the Iran news. Oil rose 0.7% in Asia today around $137 a barrel. BSE clocked a turnover of Rs 5,073 crore today,9 July 2008 as compared to a turnover of Rs 4,643.50 crore on 8 July 2008. The BSE Mid-Cap index up 2.87% at 5,468.46, while the BSE Small-Cap index up 3.55% to 6,795.65. The market breadth was strong on BSE, with 2,125 gainers outpacing 535 losers. 63 stocks remained unchanged. India’s largest private sector firm by market capitalization and oil refiner Reliance Industries rose 5.63% to Rs 2,090. Reliance Industries (RIL) has reportedly signed an agreement with Peru's Perupetro to jointly explore for oil and gas in the Andean country. The two firms are likely to bid in a Peruvian government auction of 22 oil blocks with hydrocarbon potential. As part of the deal with Pan Andean, Reliance will incur all exploration costs through commercial discovery. Following a commercial find of an agreed size, Pan Andean will reimburse Reliance for its share of the exploration cost. Realty stocks rose. Lanco Infratech (up 15.73% to Rs 326.75), Indiabulls Real Estate (up 5.86% to Rs 282), DLF (up 4.32% to Rs 448.20) and Unitech (up 7.87% to Rs 174.15) edged higher. Power stocks climbed. Reliance Infrastructure (up 10.34% to Rs 833), Reliance Power (up 9.27% to Rs 149.70), NTPC (up 4.68% to Rs 168.75), Tata Power Company (up 3.11% to Rs 1,061.40) edged higher. Capital goods stocks were firm. Larsen & Toubro (up 4.7% to Rs 2,512.95), Bharat Heavy Electricals (up 5.14% to Rs 1,575.30) and Suzlon Energy (up 6.25% to Rs 209.05) edged higher. Banking stocks gained. Axis Bank (up 10.08% to Rs 669.75), ICICI Bank (up 4.72% to Rs 6321.90), HDFC Bank (up 5.72% to Rs 1,058.75) and State Bank of India (up 2.83% to Rs 1,238.50) edged higher. Jaiprakash Associates (up 10% to Rs 173.30), Tata Motors (up 7.49% to Rs 404.55), ITC (up 6.78% to Rs 183.50),Tata Consultancy Services (up 5.92% to Rs 875.65), Bharti Airtel (up 4.99% to Rs 747.40) and Infosys (up 4.9% to Rs 1,821.10) edged higher from Sensex pack. India’s second largest telecom services provider by sales Reliance Communications rose 6.15% to Rs 440.95. South African mobile phone operator MTN Group said today, 9 July 2008, it had agreed to extend its exclusive talks with India's Reliance Communications until 21 July 2008. MTN and Reliance Communications started talks on 26 May 2008 that could create a $66 billion emerging markets telecoms group with operations in about two dozen countries and around 120 million subscribers. US crude oil futures fell sharply on Tuesday, 8 July 2008, under pressure from a stronger dollar and forecasts that eased worries about Hurricane Bertha. Crude oil for August delivery slumped 3.8% to $136.04 a barrel on the New York Mercantile Exchange. In Asia, key benchmark indices in China, Singapore, Hong Kong, and Japan were up by between 0.15% to 3.75%. Key benchmark indices in Taiwan and South Korea were down by between 0.05% to 0.92%. US markets had another wild trading day of ups and downs but ended with decent gains on 8 July 2008, after oil prices retreated from record highs, easing concerns on consumer spending. The Dow Jones industrial average gained 152.25 points, or 1.36%, to 11,383.21. The S&P 500 advanced 21.39 points, or 1.71%, to 1,273.70, while the Nasdaq composite index added 51.10 points, or 2.28%, to 2,294.42. Prime Minister Manmohan Singh on 7 July 2008 said that the government will go through the remaining formalities of the Indo-US nuclear deal. The Prime Minister is likely to discuss the progress of the Indo-US nuclear deal with US President George Bush today, 9 July 2008. He also expressed confidence that UPA government will survive the trust vote and avoid early elections.

Source: Capital Market

Market ends well off lows

The market came off lower level after an initial sharp fall, shrugging of decision of Left parties to withdraw their support to the Congress-led United Progressive Alliance (UPA) government. The moment the Left front announced their decision in afternoon trade, recovery began on the bourses. FMCG, consumer durables, and IT stocks slipped while capital goods and power stocks climbed. The market breadth was weak
Stocks declined in Asia and Europe after sharp decline in shares of top US mortgage firms Fannie Mae and Freddie Mac on Monday, 7 July 2008, on funding concerns reminded investors about the fragility of global credit markets.
The left's exit is expected to lead to a parliamentary vote of confidence in the government, which hopes the newly enlisted support of the regional Samajwadi Party (SP) will enable it to win such a ballot and avoid calling early general elections. Left parties had for months threatened to end their support if the government pressed ahead with the deal and approached the International Atomic Energy Agency for its approval.
Prime Minister Manmohan Singh on Monday, 7 July 2008 said the UPA government will go through the remaining formalities of the nuclear deal with the US and expressed full confidence that his government will last its full term. SP said on Tuesday it will vote with the government in support of the nuclear deal with the United States.
In Europe, key benchmark indices in France, Germany and UK were down by between 2.26% to 2.29%.
The 30-share BSE Sensex provisionally ended down 155.40 points or 1.15% at 13,370.59. At the day’s low of 13,049.96 Sensex lost 476.03 points in mid-morning trade. At the day’s high of 13,451.67 hit in late trade Sensex lost 74.32 points.
The broader based S&P CNX Nifty was down 37.25 points or 0.92% at 3,992.75 as per the provisional figures.
BSE clocked a turnover of Rs 4,513 crore today 8 July 2008 as compared to Rs 6,784.55 crore on Monday, 7 July 2008.
The BSE Mid-Cap index down 0.41% at 5,317.78, while the BSE Small-Cap index shed 0.3% to 6,573.01.
The market breadth was weak on BSE, with 1394 losers outpacing 1,180 gainers. 81 stocks remained unchanged.
India’s largest private sector firm by market capitalization and oil refiner Reliance Industries declined 2.47% to Rs 1,978.
India’s largest commercial bank State Bank of India rose 3.24% to Rs 1,209.70. It recovered from session’s low of Rs 1,059.40.
Capital goods stocks rose. India’s largest engineering and construction firm by sales Larsen & Toubro rose 1.5% to Rs 2,400.20 as it bagged a Rs 1047-crore order from Railways. It recovered from session’s low of Rs 2,260.80. Bharat Heavy Electricals (up 2.18% to Rs 1,498.25) and Suzlon Energy (up 1% to Rs 196.75) edged higher.
Power stocks also rose. NTPC (up 3.6% to Rs 161.20), PowerGrid Corporation of India (up 2.4% to Rs 78.95), Reliance Power (up 0.96% to Rs 137) edged higher. India’s second largest power utility firm in terms of sales Reliance Infrastructure fell 3.03% to Rs 754.95.
India's second largest software exporter by sales Infosys Technologies fell 3.62% to Rs 1,736.
India’s third largest IT services provider by sales Satyam Computer Services fell 2.99% to Rs 467.55. The company said on Monday, 7 July 2008, it has entered into an alliance with Tyfone, a global provider of mobile financial services, infrastructure and fully-integrated mobile payments capabilities. The two companies will collaborate to provide businesses with an even greater edge when competing in the mobile financial services sector.
Tata Consultancy Services (down 2.97% to Rs 826.70) and Wipro (down 4.61% to Rs 419.70) edged lower.
FMCG stocks declined. ITC (down 3.24% to Rs 171.85) and United Spirits (down 2.52% to Rs 1,100.10) edged lower. India’s largest FMCG major by sales Hindustan Unilever rose 0.07% to Rs 209.60.
Consumer durables stocks fell. Videocon Industries (down 2.99% to Rs 269.10), Titan Industries (down 1.35% to Rs 1,035.70) and Rajesh Exports (down 4.45% to Rs 52.60) edged lower.
ACC (up 6.21% to Rs 527), Mahindra & Mahindra (up 3.92% to Rs 515.80), Hindalco Industries (up 2.18% to Rs 145.40), Ambuja Cements (up 0.81% to Rs 74.50) edged higher from the Sensex pack.
Tata Motors (down 4.13% to Rs 376.35), Grasim Industries (down 3.19% to Rs 1,670.70), HDFC (down 2.14% to Rs 2,010.95), ICICI Bank (down 1.64% to Rs 593.85), Bharti Airtel (down 2.03% to Rs 711.90), edged lower from the Sensex pack.
India’s second largest telecom services provider by sales Reliance Communications fell 1.05% to Rs 415.40. The stock recovered from session's low Rs 395.05. As per reports, talks between Reliance Communications (RCom) and South Africa's MTN Group which are due to end on Tuesday, 8 July 2008, may be extended by three or four weeks. The deal may be structured in a way whereby RCom Chairman Anil Ambani will take 51% in the South African firm through a cash and share swap. Such an arrangement will require more scrutiny by MTN which is the reason why the deadline for the 45-day exclusivity pact might be extended, reports suggest.
Asian markets which opened before Indian market, retreated after sharp declines in shares of top US mortgage firms Fannie Mae and Freddie Mac on funding concerns reminded investors about the fragility of global credit markets. Key benchmark indices in Taiwan, Singapore, Hong Kong, South Korea, Japan were down by between 1.74% to 3.94%. China’s Shanghai Composite rose 0.81%.
US markets edged lower yesterday, 7 July 2008, on concerns that the top two mortgage providers would have to raise even more capital, eroding existing shareholders' stakes further. The Dow Jones industrial average lost 56.58 points, or 0.50%, to 11,231.96. The Standard & Poor's 500 index slipped 10.59 points, or 0.84%, to 1,252.31, and the Nasdaq Composite index dropped 2.06 points, or 0.09%, to 2,243.32.
Oil, India's biggest import, rose by more than half a dollar to nearly $142 a barrel, rebounding from the previous day's near $4 fall as the US dollar weakened.
Source: Capital Market

Market skids in late trade

The market lost close to 300 points in late trade provisionally ending marginally higher after reports filitered in that India's Defence Attache Brigadier R D Mehta and three other Indians have been killed in a suicide attack on the Indian Embassy in Kabul today. A sharp slump in prices of Reliance Industries, Reliance Communcations, Reliance Infrastructure, Larsen & Toubro, and Bharat Heavy Electricals caused the late slide on the bourses.
IT, FMCG stocks gained whereas oil & gas and capital goods stocks fell. The market breadth was strong with small-cap and mid-cap shares staging a comeback after a sharp recent plunge. Market had remained firm in most part of the day on firm global cues and due to easing of political uncertainty.
Poitical worries receded with Samajwadi Party (SP), a regional party, on making it clear during the week end that it will support the Congress-led United Progressive Alliance (UPA), at a time when Left parties are on the verge of withdrawing support. The Left front has set 7 July 2008 as deadline for the government to let them know whether it intends to approach the International Atomic Energy Agency to seal the India-specific safeguards agreement.
European markets which opened after the Indian markets were in green. Key benchmark indices in France, Germany and UK were up between 0.09% to 0.59%.
The 30-share BSE Sensex provisionally rose 48.99 points or 0.36% at 13,502.99. At the day’s high of 13,793.39 hit in mid-morning trade, the Sensex had gained 339.29 points. Sensex was up 22.29 points at the day's low of 13,476.29 hit in opening trade.
The broader based S&P CNX Nifty ended up 14 points or 0.35% at 4,030.
BSE clocked a turnover of Rs 6,697 crore today 7 July 2008 as compared to a turnover of Rs 5,677.98 crore on Friday, 4 July 2008.
The BSE Mid-Cap index was up 0.92% at 5,326.81, while the BSE Small-Cap index was up 2.15% at 6,588.32. Both these indices outperformed the Sensex.
The market breadth was strong on BSE, with 1817 gainers outpacing 820 losers. 65 stocks remained unchanged.
Among the 30-member Sensex pack, 21 advanced while the rest declined.
India’s second largest power utility firm by sales Reliance Infrastructure declined 0.31% to Rs 771.05. It came off from session's high of Rs 838.75. India’s second largest telecom services provider by sales Reliance Communications fell 3.9% to Rs 421.10. It came off from session's high of Rs 454.90.
India’s largest private sector bank by sales ICICI Bank slipped 0.76% to Rs 596.10. It came off from session's high of Rs 639.95.
India’s largest private sector firm by market capitalization and oil refiner Reliance Industries fell 3.88% at Rs 2,017.50. It was the top loser from the Sensex pack.
Cairn India (down 5.49% to Rs 237.70), Essar Oil (down 1.95% to Rs 176.20) and Reliance Petroleum (down 2.77% to Rs 166.55) edged lower. Shares of state-run oil marketing companies rose. BPCL (up 5.52% to Rs 240.90), HPCL (up 4.2% to Rs 192.20) and Indian Oil Corporation (up 1.96% to Rs 348) edged higher.
As per reports, private oil companies like Reliance Industries (RIL), Essar and Cairn may have to forgo some of their profits to share the huge subsidy burden in the oil sector. A proposal on these lines, which was first mooted by the Left parties, is now being considered seriously by the ruling party leadership, following a similar demand by the Congress' latest political ally, the Samajwadi Party. A windfall tax is normally levied on oil exploration and production companies who reap huge profits when global crude prices increase.
Capital goods stocks declined. India’s largest engineering and construction firm by sales Larsen & Toubro (L&T) lost 1.06% to Rs 2,408. The company today bagged an order worth Rs 446 crore from JSW Power Transco for transmission lines. India’s largest electric equipment maker by sales Bharat Heavy Electricals fell 2.26% to Rs 1466.35. However Suzlon Energy rose 1.35% to Rs 194.80.
IT stocks gained. India's second largest software exporter by sales Infosys Technologies rose 2.61% at Rs 1,801.20. The company will announce its Q1 Result on 11 July 2008. Satyam Computer Services (up 4.28% to Rs 481.95), Wipro (up 2.54% to Rs 440) and Tata Consultancy Services (up 0.98% to Rs 852) edged higher.
FMCG stocks rose. ITC (up 3.98% to Rs 177.60), United Spirits (up 4.15% to Rs 1,128.50), Hindustan Unilever (up 3.89% to Rs 209.45) edged higher.
Jaiprakash Associates (up 4.47% to Rs 160.15), Mahindra & Mahindra (up 4.4% to Rs 496.35), Maruti Suzuki India (up 4.34% to Rs 574.35), State Bank of India (up 3.92% to Rs 1,171.75), ACC (up 3.82% to Rs 496.20) edged higher from Sensex pack.
Tata Motors (down 2.07% to Rs 392.55), HDFC (down 0.02% to Rs 2,055), Ranbaxy Laboratories (down 0.65% to Rs 534.90), Ambuja Cements (down 1.07% to Rs 73.90) edged lower from Sensex pack.
Everonn Systems India rose 4.45% to Rs 452 after the company signed a memorandum of understanding with Himachal Pradesh state government to implement IT education in 793 senior secondary schools in the state.
Asian markets which opened before Indian market, edged higher. The key benchmark indices in China, Hong Kong, Japan, Singapore, South Korea and Taiwan were up by 0.11% to 4.59%. US stock markets were closed for the Independence Day holiday on Friday, 4 July 2008.
US light crude for August delivery traded at $143.92 a barrel and London Brent crude rose 23 cents to $144.65 a barrel. Crude oil hit a record $145.85 on 3 July 2008.
Source: Capital Market

Market ends on an upbeat note; RCom soars

The market today shrugged off higher inflation on hopes a political turmoil arising from Indo-US nuclear deal may be avoided. Blue chips bounced back. Mid-cap and small-cap stocks also recovered. Realty, capital goods and power counters which had declined sharply in the past few days were at the forefront of today's rebound. Reliance Communication, India's second biggest mobile services firms by market capitalisation surged.
The government is seeking support from the Samajwadi Party (SP), a key regional party in Uttar Pradesh to retain power at a time when Left parties are on the verge of withdrawing support. SP party leaders today met Prime Minister Manmohan Singh and hinted that they would approve the deal.
SP has 39 seats in parliament, compared with 59 for the communist parties. The Congress-led ruling coalition needs the support of 44 lawmakers to reach a majority. It would try and win the other five seats from smaller parties. SP is likely to announce its decision on supporting the Congress-led United Progressive Alliance (UPA) government in a couple of days
India's wholesale price index rose 11.63% in the 12 months to 21 June 2008, above the previous week's annual rise of 11.42%, government data released today afternoon showed.
Oil, India's biggest import, rose to a fresh record high above $145 per barrel on Thursday, 3 July 2008. The US oil settled up $1.72 at $145.29 a barrel on Thursday.
As per provisional closing, the 30-share BSE Sensex rose 310.76 points or 2.37% at 13,404.87. At the day’s high of 13,509.74, the Sensex gained 415.63 points in late trade. Sensex lost 66.32 points at the day's low of 13,027.79, hit in early trade.
The broader based S&P CNX Nifty was up 75.40 points or 1.92% at 4001.15.
The BSE Mid-Cap index was up 1.96% at 5,263.01, while the BSE Small-Cap index was up 1.49% at 6,444.06.
The market breadth was strong on BSE, with 1688 gainers outpacing 912 losers. 74 stocks remained unchanged.
BSE clocked a turnover Rs 5604 crore as against Rs 5,645.90 on Thursday, 3 July 2008.
India’s second largest listed cellular service provider Reliance Communication rose 13.41% at Rs 441.75. As per reports, Mukesh Ambani-controlled Reliance Industries (RIL) on Thursday, 3 June 2008 shot off another letter to Reliance Communications (RCOM) invoking a right of first refusal (RoFR). A copy of the letter was also sent to South African telco MTN with which RCOM is negotiating a deal, the exact contours of which are not yet clear.
India’s largest private sector firm by market capitlisation Reliance Industries rose 1.07% at Rs 2093.20.
India’s largest private sector bank by assets ICICI Bank rose 2.64% at Rs 589.
India’s second largest software exporter by sales Infosys Technologies rose 0.36% at Rs 1754.
The top gainers from the Sensex pack were DLF (up 7.69% at Rs 411.20), Bharat Heavy Electricals (up 7.62% at Rs 1503), Reliance Infrastructure (up 7.13% at Rs 773), and larsen & Toubro (up 5.86% at Rs 2365).
The top Sensex losers were, Tata Steel (down 3.62% at Rs 633.65), Cipla (down 2.01% at Rs 207.30), Maruti Suzuki (down 1.27% at Rs 541.90), and TCS (down 1.98% at Rs 838) and Wipro (down 0.66% at Rs 427).
Abrasives maker Carborundum Universal rose 2.97% to Rs 125 after the company entered into an agreement with Foskor (Proprietary), South Africa to acquire 51% stake in Foskor Zirconia (Proprietary), Phalaborwa, South Africa, for an undisclosed sum.
Pharmaceuticals products maker Panacea Biotec spurted 8.99% to Rs 303 after the company announced its foray into healthcare delivery by entering into a collaboration to set up a 220 bed multi speciality hospital in the National Capital Region, Gurgaon.
Irrigation equipments maker Jain Irrigation Systems advanced 5.35% to Rs 460.05 after a block deal of 25.45 lakh shares was struck on the counter at Rs 442 per share by 10:06 IST on BSE
Brigade Enterprises rose 1.09% to Rs 102.15 after the company said it has won an auction bid of 10.5 acres of land of ERL, a division of BPL on the Old Madras Road, Bangalore.
Low cost carrier Spicejet spurted 7.33% at Rs 24.90 on reports Kingfisher Airlines is close to sealing a share-swap deal with the Delhi-based low-cost carrier. The share swap is expected to be in the ratio of 1:3, where SpiceJet shareholders will get one share of the merged entity for every three SpiceJet shares owned by them.
Jewellery maker Gitanjali Gems rose 10.81% at Rs 259.95 on reports the company plans to buy US-based retail chain Whitehall Jewellers Holdings, which recently filed for bankruptcy. The deal, if concluded, would be between Rs 350 - Rs 400 crore.
Auto components maker Amtek Auto jumped 5.38% at Rs 229 on reports Private equity firm Chrys Capital has reportedly acquired close to 7% in the company for Rs 229 crore via open market purchases in the past three months. The sellers included Citigroup, CLSA and Copthall.
European market, which opened after Indian markets, were in red. Key benchmark indices in Germany, France and UK were down by 0.37% to 0.76%.
Asian stocks were mixed today. Key benchmark indices in Hong Kong, and Singapore were up by between 0.42% to 0.85%. Key benchmark indices in China, Japan, Taiwan and South Korea were down by between 0.21% to 2.24%.
US market ended mixed on Wednesday, 3 July 2008 as the payrolls data in the United States was not as weak as some had feared and with another record oil price boosting energy shares. The Dow Jones industrial average rose 73.03 points, or 0.65%, at 11,288.54. The Standard & Poor's 500 Index added 1.38 points, or 0.11%, at 1,262.90. The Nasdaq Composite Index fell 6.08 points, or 0.27%, at 2,245.38
Communist parties today, 4 July 2008, said the government must tell them by Monday, 7 July 2008, if it plans to press ahead with the next step in a controversial civilian nuclear deal with the United States. Left parties have threatened to end their backing for the government if it seeks approval for the deal from the International Atomic Energy Agency (IAEA), the next international move needed to operationalise the pact.
Left parties also decided to launch a national campaign from 14 July 2008 to explain its opposition to the nuclear deal and over runaway inflation.
Source: Capital Market

Fall resumes on the bourses as oil hits record high

A surge in oil price to a record high above $144 a barrel and overnight fall in US stocks that pushed the Dow Jones Industrial Average to bear market, weighed on the investor sentiment with Sensex falling more than 700 points at one point of time. The Sensex provisionally ended just above 13,000 mark while Nifty ended below 4,000 mark. Tata Steel fell more than 11%. European markets were in red
All the sectoral indices on BSE were in the red. Power, banking realty and metal stocks slumped. The market breadth was weak.
Oil, India's biggest import, rose to a fresh record high above $144 per barrel on Wednesday, 2 July 2008. Oil has risen more than 40% in calendar 2008 so far and it is the key reason for the turmoil of Indian equities. A section of the market reckons that only a sharp fall in oil prices can bring out a meaningful recovery in battered Indian stocks.
In Europe, key benchmark indices in France , UK and Germany were down by between 0.58% to 0.9%. In Asia, key benchmark indices in Singapore, Hong Kong, Japan and South Korea were down by between 0.16% to 2.13%. Key benchmark indices in Taiwan and China were up by between 0.55% to 1.95%.
The Dow Jones Industrial Average sank into a bear market on Wednesday, 2 June 2008, after a report showed US private employers cut the most jobs in nearly six years and oil shot to another record, increasing concerns about the health of the economy and corporate profits. Dow tumbled 166.75 points, or 1.46%, to 11,215.51. The Standard & Poor's 500 Index lost 23.39 points, or 1.82%, to close at 1,261.52, while the Nasdaq Composite Index slid 53.51 points, or 2.32%, to end at 2,251.46.
The 30-share BSE Sensex provisionally ended down 607.88 points or 4.45% at 13,056.74. At the day’s low of 12,934.92 Sensex lost 729.7 points in afternoon trade. Sensex was down 133.94 points at the day's high of 13,458.30 hit in opening trade.
The broader based S&P CNX Nifty was down 172.9 points or 4.22% at 3,920.45 as per the provisional figures.
The BSE clocked a turnover of Rs 5,585 crore today 3 July 2008 as compared to a turnover of Rs 6,421.03 crore on Wednesday, 2 July 2008.
Hopes that a political crisis over Indo-US nuclear deal may be avoided triggered a strong rebound on the bourses yesterday, 2 July 2008, with the Sensex surging 703 points, its biggest single day rise in more than three months.
Back to today's trade, the market breadth was weak on BSE. 769 shares advanced as compared to 1,852 that declined. 61 remained unchanged. 28 from 30 Sensex stocks were in red.
India’s largest private sector company in terms of market capitalisation and oil refiner Reliance Industries (RIL) fell 3.22% to Rs 2,074.
India's second largest IT exporte by sales Infosys declined 4% to Rs 1,747.80.
From the side counters, Lok Housing Constructions (down 18.18% to Rs 49.50), IP Rings (down 15.81% to Rs 45.25), Cyber Media India (down 15.58% to Rs 40.10) and Arvind Chemicals (down 15% to Rs 36.55), declined sharply.
Realty stocks declined. The BSE Realty index was down 9.95% to 4,260.46 and it was the major loser from sectoral indices on BSE. Indiabulls Real Estate (down 8.65% to Rs 261.45), Unitech (down 9.99% to Rs 154) and DLF (down 9.93% to Rs 381.85) edged lower. The BSE Realty index had risen more than 12% in yesterday’s rebound on the bourses.
Metal stocks fell. Tata Steel (down 11.3% to Rs 657.45), Steel Authority of India (down 9.8% to Rs 128), Sterlite Industries (down 7.99% to Rs 658.10), Hindalco Industries (down 4.6% to Rs 135.75), National Aluminium Company (down 2.22% to Rs 341.70) edged lower.
Banking stocks fell ahead of inflation data scheduled at 12:00 IST tomorrow, 4 July 2008. ICICI Bank (down 7.89% to Rs 573.85) and HDFC Bank (down 3.6% to Rs 983.80) edged lower. However, India's biggest commercial bank, State Bank of India gained 0.6% to Rs 1086
Power stocks fell. Tata Power Company (down 9.03% to Rs 1,000.05), Reliance Infrastructure (down 8.72% to Rs 721.55), NTPC (down 3.91% to Rs 152.55) and Reliance Power (down 1.51% to Rs 130.55) edged lower.
ACC (down 5.94% to Rs 472.30), ITC (down 5.71% to Rs 169.35), Tata Motors (down 5.55% to Rs 390.45), Grasim Industries (down 5.45% to Rs 1,678.15), HDFC (down 5.09% to Rs 1,935.50) edged lower from the sensex pack.
India’s second largest telecom services provider by sales Reliance Communications fell 6.91% to Rs 389.50. It may reportedly partner with a sovereign wealth fund in Middle East and may directly buy a large equity stake in South Africa's MTN, thereby emerging as the single-largest shareholder.
India’s largest state owned oil exploration firm by sales ONGC rose 0.56% to Rs 859.20. As per reports, ONGC sees the cost of replacing its exploration and production infrastructure in the north-eastern state of Assam to double to around Rs 4000 crore due to rising steel prices.
Dolphin Offshore Enterprises India declined 5.24% to Rs 152 despite securing a two-month diving services contract worth Rs 33 crore from a Malaysian firm.
As per media reports, Congress-led United Progressive Alliance (UPA) government may be able to retain power as Samajwadi Party (SP) is likely to provide support to the government at a time when Left parties are on the verge of withdrawing support to the government over Indo-US nuclear deal. SP has 39 seats in parliament, compared with 59 seats for the communist parties. The ruling coalition needs the support of 44 lawmakers to reach a majority and it hopes to also win support from a few smaller parties.
Latest media reports also suggest that SP may seek removal of Finance Minister P Chidambaram, Reserve Bank of India Governor Y.V. Reddy and Oil Minister Murli Deora, blaming them for high inflation.
Foreign funds sold shares worth a net Rs 668.43 crore on Wednesday, 2 July 2008, provisional data released by stock exchanges showed.
There are concerns that the rise in input costs and tough macro economic environment comprising high inflation, record high global crude oil prices and rising interest rates, will result in slowdown in earnings growth of India Inc. According to Morgan Stanley, net earnings of 30 Sensex firms are expected to grow just 6% in Q1 June 2008 over Q1 June 2007.
Source: Capital Market

Market takes repo rate, CRR hike in its stride

Short covering ahead of the expiry of June 2008 derivatives contracts tomorrow, 26 June 2008, helped the market stage a solid rebound from an initial slump caused by the Reserve Bank of India's move late evening yesterday, 24 June 2008, to hike the key lending rate in an aggressive attempt to combat over 11% inflation. The market snapped its five-day slide. The market breadth turned positive later in the day in contrast to a weak breadth earlier in the day.

Heavyweights Reliance Industries and Bharti Airtel, were at the centrestage of the recovery. European and most Asian markets, were in green which also helped the recovery on the battered domestic bourses.

RBI raised its key lending rate viz. the repo rate by 50 basis points to 8.5% with immediate effect, its highest since March 2002 and the second hike this month. It also increased the cash reserve ratio, the ratio of deposits banks must keep with it, to 8.75% from 8.25% in two 25-basis-point stages on 5 July 2008 and 19 July 2008.

The 30-share BSE Sensex gained 117.40 points or 0.83% at 14,223.98, as per provisional closing. At the day’s high of 14,247.16 hit in late trade, the Sensex gained 140.58 points. Sensex opened 333.27 points lower at 13,776.21 and slipped further to touch a low of 13,736.01 in early trade. At the day’s low, the Sensex lost 370.57 points.

The broader based S&P CNX Nifty surged 60.40 points or 1.44% at 4,251.50 as per provisional closing

The market breadth was positive. On BSE, 1379 shares advanced as compared to 1260 that declined. 68 remained unchanged.

The BSE Mid-Cap index was up 0.61% to 5,747.60 and the BSE Small-Cap index was up 0.87% to 7,067.42

The total turnover on BSE amounted to Rs 5240 crore as compared to Rs 3766 crore by 14:30 IST

Among the 30-member Sensex pack, 17 gained while the rest slipped.

Reliance Communications (RCom), the country’s second largest telecom services provider in terms of market capitalisation galloped 6.85% to Rs 507.40 on 31.95 lakh shares. It was the top gainer from Sensex pack. As per reports, RCom’s proposed merger deal with South Africa based global operator, MTN is expected to close by first week of July 2008

Shares from metal sector surged. Hindalco Industries (up 2.18% to Rs 147.90), Tata Steel (up 4.18% to Rs 741), JSW Steel (up 4.23% to Rs 1002), Sesa Goa (up 2.12% to Rs 3370), and Steel Authority of India (up 2.91% to Rs 150.45), were the other gainers from metal sector.

Bharat Heavy Electricals (Bhel), the country’s largest state-run engineering company in terms of order book, surged 3.88% to Rs 1445. As per recent reports, Bhel has paid 42.8% higher advance tax at Rs 300 crore in the first installment of this financial year over the corresponding period in the previous year.

However Larsen & Toubro, the country’s largest private sector engineering company in terms of order book slipped 0.16% to Rs 2307, after touching a low of Rs 2235.25. The stock is currently trading 1:1 cum bonus.

India’s largest private sector company in terms of market capitalisation and oil refiner Reliance Industries (RIL) advanced 4.05% to Rs 2149.95 on 13.16 lakh shares. RIL has reportedly signed a cooperation agreement with UAE-based Crescent Petroleum to jointly undertake projects of mutual interest in the region's energy sector.

Bharti Airtel (up 4.58% to Rs 785), Reliance Infrastructure (up 3.55% to Rs 943.30), and Ranbaxy Laboratories (up 4.12% to Rs 546.95), edged higher from Sensex pack.

India’s largest state-run oil exploration company Oil & Natural Gas Corporation (ONGC) rose 1.73% to Rs 870.10. The company posted 6.77% rise in net profit to Rs 16701.65 crore on 6.54% increase in net sales to Rs 64859.18 crore in the year ended March 2008 over the year ended March 2007. The company announced the results during trading hours today, 25 June 2007.

Real estate stocks rebounded from early lows. DLF (up 2.35% to Rs 450.20), Unitech (up 7% to Rs 182.60), Purvankara Projects (up 6.83% to Rs 183), Mahindra Lifespace Developers (up 2.45% to Rs 498), and Anant Raj Industries (up 0.81% to Rs 137), gained.

Auto stocks staged a sharp recovery from early lows. India’s top small car maker Maruti Suzuki India advanced 3.15% to Rs 700, off day’s low of Rs 640. However, Tata Motors (down 1.41% to Rs 475), and Mahindra & Mahindra (down 0.08% to Rs 537) declined.

Banking and financial shares though in the red pared losses. ICICI Bank (down 1.16% to Rs 697, off day’s low of Rs 675.10), State Bank of India (down 0.49% to Rs 1206, off day’s low of Rs 1155), and Kotak Mahindra Bank (down 2.55% to Rs 525, off day’s low of Rs 512.50), recovered from lower level

India’s largest dedicated housing finance company, Housing Development Finance Corporation slumped 4.47% to Rs 2165 on 1.83 lakh shares. It was the top loser from the Sensex pack.

Software pivotals were subdued after Indian rupee firmed against the dollar. Satyam Computer Services (down 1.12% to Rs 449), Wipro (down 2.59% to Rs 458), and Infosys (down 2.15% to Rs 1754.50), declined. However India’s largest software services exporter TCS vaulted 4.72% to Rs 883.80.

The partially convertible Indian rupee was trading at 42.78/79 per dollar in afternoon trade, stronger than Tuesday's close of 42.9625/9700. A firm rupee impacts margins of IT firms negatively as they derive majority of their revenue from exports to the US.

ITC (down 2.65% to Rs 186), Cipla (down 2.75% to Rs 207.15), and Grasim (down 2% to Rs 2046), edged lower from the Sensex pack.

Sugar stocks gained on momentum buying. Shree Renuka Sugars (up 8.55% to Rs 112.30), Bajaj Hindustan (up 1.87% to Rs 183.50), Balrampur Chini Mills (up 2.89% to Rs 85.40), Uttam Sugar Mills (up 4.94% to Rs 61.60), and Sakthi Sugar (up 4.54% to Rs 67.90), surged.

Spice Communication was the top traded counter on BSE with total turnover of Rs 339.39 crore followed by Reliance Capital (Rs 321.40 crore), Reliance Industries (Rs 276.49 crore), Reliance Petroleum (Rs 196.23 crore), and ONGC (Rs 156.66 crore), in that order.

Spice Communication surged 32.93% to Rs 72.25 on huge volumes of 4.87 crore shares after Idea Cellular said it will buy 40.8% stake in the company at Rs 77.30 a share. Meanwhile, shares of Idea Cellular were up 2.37% at Rs 101.50.

Idea Cellular said it would merge Spice with itself through a share swap whereby Spice shareholders would get 49 Idea shares for every 100 Spice shares held. Idea also said that it would make an open offer for additional 20% stake to Spice Communicaton shareholders at Rs 77.30 a share.

In a crucial event on the political front, an UPA-Left committee on the Indo-US nuclear deal will meet later today, 25 June 2008, to discuss the deal. However, it is difficult to say whether there will be a concrete outcome or not. The Left parties have already made it clear that they withdraw their support to the government if it moves ahead with the nuclear deal. This could further worsen the already weak stock market sentiment.

Volatility is likely to remain high as derivatives contracts for June series expire on Thursday, 26 June 2008. As per reports, the marketwide rollover of positions from June 2008 series to July 2008 series stood at 43.10% while that of Nifty was 44.70%, as on Tuesday, 24 June 2008.

Crude oil prices rose 26 cents to settle at $137.00 a barrel yesterday, 24 June 2008, on the New York Mercantile Exchange

European markets, which opened after Indian market, were trading higher in early trade. Key benchmark indices in United Kingdom, France and Germany were up by between 0.44% and 1.09%.

Asian markets, which opened before Indian market were trading mixed today, 25 June 2008. China's Shanghai Composite (up 3.65% at 2,905.54), South Korea's Seoul Composite (up 0.41% at 1,717.91), Taiwan Weighted (up 1.51% at 7,855.06), Hang Seng (up 0.64% to 22,598.79), Singapore's Straits Times (up 0.37% at 2,973.30) advanced. However, Japan's Nikkei slipped 0.14% at 13,829.92

US markets ended lower yesterday, 24 June 2008 on concerns about the economy, after a report showed consumer confidence hit a 16-year low. The Dow Jones industrial average lost 34.93 points, or 0.29%, to 11,807.43. The Standard & Poor's 500 index fell 3.71 points, or 0.28%, to 1,314.29, and the Nasdaq composite index declined 17.46 points, or 0.73%, to 2,368.28.


Source: Capital Market

Sensex falls below 14,000 for the first time in 10 months

Sensex falls below 14,000 for the first time in 10 months

Equities extended losses for a fifth straight day today with the barometer index BSE Sensex falling below the psychologically important 14,000 mark for the first time in 10 months since late August 2007. Heavy selling pressure in index pivotals during the second half of the day’s trading sessions spooked the market. Metal and FMCG shares were the worst hit in today’s trade.

Choppy swings were witnessed in late trade with the market bouncing in the green, lead by solid rally in index heavyweight Reliance Industries (RIL). However, RIL quickly pared gains pulled the market sharply lower in late trade. The market breadth was weak. All sectoral indices in BSE suffered losses. Asian and European markets were trading lower.

Fears of further increase in interest rates to tame inflation continued to weigh on the market sentiment. Reserve Bank of India (RBI) governor signaled on Monday, 23 June 2008, that the central bank will tighten monetary policy further to tackle inflation that surged past 11% in early June 2008 to a 13-year high.

In a crucial global event, the US Federal Reserve is expected to hold key rate for short-term lending at its current 2%, at its two-day policy meeting that begins today, 24 June 2008. Investors will scrutinise the statement accompanying the decision for clues on the future course of monetary policy.

Meanwhile, a crucial UPA-Left meeting on the controversial civilian nuclear deal with the United States is scheduled tomorrow, 25 June 2008. The left allies, whose parliamentary support is crucial to the Congress-led United Progress Alliance (UPA) government at the Centre, have said they would withdrew support if the government went ahead with the deal.

The 30-share BSE Sensex was down 301.06 points or 2.11% at 13,992.26, as per provisional closing. Sensex lost 302.01 points at day’s low of 13,991.31 hit in fag trade. At the day’s high of 14,432.90, the Sensex gained 139.58 points in early trade.

The broader based S&P CNX Nifty slumped 105.55 points or 2.47% at 4,160.85 as per provisional closing.

The market breadth was weak. On BSE, 1930 shares declined as compared to 713 that advanced. 67 remained unchanged.

The BSE Mid-Cap index slipped 1.97% to 5,700.52 and the BSE Small-Cap index fell 1.90% to 7,000.54. Both these indices underperformed the Sensex.

The total turnover on BSE amounted to Rs 5355 crore as against Rs 3597 crore by 14:30 IST

Among the 30-member Sensex pack, 24 declined while the rest gained.

Metal shares declined sharply. India’s largest private sector steel maker Tata Steel plunged 7.08% to Rs 692.80 on 12.52 lakh shares. It was the top loser from Sensex pack.

Sterlite Industries (down 5.39% to Rs 698.10), Hindalco Industries (down 3.65% to Rs 143), National Aluminium Company (down 11.20% to Rs 359.95), Jindal Steel & Power (down 4.95% to Rs 1810.05), and Sesa Goa (down 4.3% to Rs 3230) were the other major losers from the metal sector.

Hindustan Unilever (down 6.38% to Rs 212.10), Dabur India (down 4.40% to Rs 88.10), ITC (down 2.74% to Rs 190.05), Marico (down 5.58% to Rs 58.40), and Nestle India (down 0.70% to Rs 1648), edged lower from FMCG sector.

India’s largest private sector company in terms of market capitalisation and oil refiner Reliance Industries (RIL) saw high volatility in the day. The stock settled 0.80% higher to Rs 2038.30 on 16.45 lakh shares. The stock swung wildly in a range of Rs 2012 and Rs 2133.70 during the day. As per recent reports, RIL plans to open its first North American plant in North Carolina by investing $215 million.

India’s largest power generation company in terms of sales, NTPC lost 4.84% to Rs 154.20. As per reports, NTPC had paid 6.9% lower advance tax at Rs 188 crore in the first installment of this financial year over the corresponding period in the previous year.

India’s largest state-run oil exploration company Oil & Natural Gas Corporation (ONGC) fell 4.75% to Rs 845.15. ONGC has decided to exit projects to set up a refinery and a special economic zone Andhra Pradesh, the company said on Monday, 23 June 2008. ONGC will unveil its Q4 and year ended March 2008 results on Wednesday, 25 June 2008.

Banking stocks slipped on selling pressure. ICICI Bank (down 2.95% to Rs 700.10), HDFC Bank (down 4.62% to Rs 1046) and State Bank of India (down 0.17% to Rs 1203), edged higher.

Software stocks slipped in the red after firm start. Satyam Computer Services (down 2.09% to Rs 450.50, off day’s high of Rs 465.75), Infosys Technologies (down 4.08% to Rs 1772.05, off day’s high of Rs 1859.90), and TCS (down 1.26% to Rs 847, off day’s high of Rs 864.80) declined.

Wipro, the country’s third largest software services exporter was down 2% to Rs 470. Wipro has reportedly raised close to Rs 1,400 crore (35 billion Yen) through external commercial borrowings (ECBs). The company has been pursuing an aggressive acquisition strategy over the last few years and it concluded two major acquisitions in the year ended March 2008 including Unza and Infocrossing for a cumulative value of close to $900 million. As of 31 March 2008, Wipro had cash and bank balance Rs 3,927 crore.

Reliance Communications (RCom), the country’s second largest telecom services provider in terms of market capitalisation slumped 2.85% to Rs 474. RCom’s proposed merger deal with South Africa based global operator, MTN is reportedly expected to close by first week of July 2008 with RCom likely to acquire 40% stake in the merged entity.

India’s leading pharma company in terms of sales, Ranbaxy Laboratories gained 2.44% to Rs 526 on 14.58 lakh shares. It was the top gainer from Sensex pack.

Bharat Heavy Electricals (Bhel), the country’s largest state-run engineering company in terms of order book, gained 2.10% to Rs 1390. As per reports, Bhel has paid 42.8% higher advance tax at Rs 300 crore in the first installment of this financial year over the corresponding period in the previous year.

India’s dedicated housing finance company Housing Development Finance Corporation advanced 2.05% to Rs 2260. The stock moved in a range of Rs 2182 and Rs 2300 in the day.

Reliance Capital was the top traded counter on BSE with turnover of Rs 454.33 crore followed by Reliance Industries (Rs 341.56 crore), Tata Steel (Rs 239.07 crore), Reliance Communication (Rs 184.91 crore), and Anu’s Labs (Rs 177.87 crore), in that order.

Volatility is expected to remain high in the near term as derivatives contracts for June series are set to expire on Thursday, 26 June 2008. As per reports, the marketwide rollover of positions from June 2008 series to July 2008 series stood at 26.50% while that of Nifty was 31%, as on Friday, 20 June 2008.

Meanwhile, as per reports, advance tax collections increased 27% to Rs 21,000 crore in Q1 June 2008 over Q1 June 2007, as of 20 June 2008. Advance taxes are paid in four instalments, in June, September, December and March. Usually, the first instalment is 15% of the total tax estimated to be paid for the whole fiscal.

European markets, which opened after Indian market, slipped into the red after firm opening. Key benchmark indices in United Kingdom, France and Germany were down by between 1.18% and 1.48%.

Asian markets, which opened before Indian market, were trading lower except China's Shanghai Composite which rose 1.50% at 2,801.72. Japan's Nikkei (down 0.06% at 13,849.56), Hong Kong's Hang Seng (down 1.14% at 22,456.02), Taiwan's Taiwan Weighted (down 1.76% at 7,738.12), Singapore's Straits Times (down 0.57% at 2,962.20) and South Korea's Seoul Composite (down 0.28% at 1,710.84) slipped.

US markets lost some ground yesterday, 23 June 2008, sending financial shares to their lowest level in five years, on a deteriorating outlook for bank earnings. The Dow Jones industrial average dropped 0.33 points, or less than 0.01%, to 11,842.36. The Standard & Poor's 500 index gained 0.07 points, or 0.01%, to 1,318.00, and the Nasdaq composite index lost 20.35 points, or 0.85%, to 2,385.74.

Crude for August delivery was up 20 cents at $136.94 a barrel today, 24 June 2008 amid fears of Nigerian supply disruptions and tensions between Israel and Iran. It had hit a record high of $139.89 on 16 June 2008.

Back home, Indian stocks suffered losses for the fourth straight session yesterday, 23 June 20008, to settle at 10-month low on sustained selling pressure throughout the day due to concerns of further policy tightening by the Reserve Bank of India with inflation reaching 13-year high and political uncertainty. The 30-share BSE Sensex lost 277.97 points or 1.91% at 14,293.32 and the broader based S&P CNX Nifty was down 81.15 points or 1.87% to 4266.40, on that day.

As per provisional data, foreign funds sold shares worth a net Rs 665.56 crore and domestic mutual funds bought shares worth a net Rs 91.75 crore yesterday, 23 June 2008.

Foreign institutional investors (FIIs) were net sellers of Rs 166.24 crore in the futures & options segment yesterday, 21 June 2008. They were net buyers of index futures to the tune of Rs 876.86 crore and sold index options worth Rs 864.33 crore. They were net sellers of stock futures to the tune of Rs 165.96 crore and sold stock options worth Rs 12.81 crore.


Source: Capital Market

Market pares losses in late trade; RIL gains

Market pares losses in late trade; RIL gains
The market recovered some of the lost ground in late trade after the barometer index BSE Sensex and the S&P CNX Nifty had tumbled to its lowest in 2008 in mid-afternoon trade. Weakness in global markets weighed on the domestic bourses. The market breadth was weak. Healthcare stocks and shares of public sector oil marketing firms rose even as IT, realty and banking stocks declined.
The 30-share BSE Sensex lost 142.15 points or 0.94% at 14,923.95 as per the provisional figures. At the day’s low of 14,645.31 the Sensex lost 420.79 points in mid-afternoon trade, falling below its previous year 2,008 low of 14,677.24 hit 18 March 2008.
Earlier, after opening on a subdued note on weak global cues, the market had recovered to trade in green for a brief period. At the day’s high of 15,088.03 Sensex gained 21.93 points in early trade.
The broader based S&P CNX Nifty was down 41.25 points or 0.92% at 4,459.70 as per the provisional figures. Nifty had hit new year 2008 low of 4369.80 today.
The BSE clocked a turnover of Rs 5,265 crore today as compared to a turnover of Rs 5,053.75 crore on Monday, 9 June 2008.
The market breadth was weak on BSE with 982 shares advancing as compared to 1,640 that declined. 76 remained unchanged. Among the 30 stocks from Sensex pack, 20 were trading in red.
The BSE Mid-Cap index fell 0.97% to 6,110.52 and BSE Small-Cap index fell 0.8% to 7,356.91.
Bharat Heavy Electricals (up 0.54% to Rs 1,382.05), Reliance Industries (RIL) (up 1.68% to Rs 2,199.40), Ambuja Cements (up 0.43% to Rs 82.30) and ACC (up 0.55% to Rs 616.40) edged higher from the Sensex pack.
ONGC (down 4.74% to Rs 831.25), HDFC (down 4.79% to Rs 2,101), Jaiprakash Associates (down 3.54% to Rs 177.15), Reliance Infrastructure (down 2.59% to Rs 1,011.60), Tata Motors (down 0.81% to Rs 512.90) edged lower from the Sensex pack.
Consumer durables stocks declined. Rajesh Exports (down 6.53% to Rs 70.85), Titan Industries (down 3.73% to Rs 1,088), Blue Star (down 3.26% to Rs 390) and Gitanjali Gems (down 1.13% to Rs 266) edged lower.
Banking stocks fell extending their recent sharp losses on concerns of further policy tightening of the monetary policy by the Reserve Bank of India to rein in inflation which is at its highest level in nearly four years. HDFC Bank (4.96% to Rs 1,130.95), State Bank of India (down 1.06% to Rs 1,279.10) and ICICI Bank (down 2.47% to Rs 731.60) edged lower.
Realty stocks extended yesterday’s huge losses. Indiabulls Real Estate (down 1.82% to Rs 391.15), Unitech (down 3.03% to Rs 179.20) and DLF (down 0.35% to Rs 479.85) edged lower.
Software services companies, which get more than half their revenue from the United States, fell on signs the US economy was heading for stagflation. BSE IT index was the top loser from the sectoral indices on BSE. It was down 2.75% to 4,283.96. Infosys (down 2.89% to Rs 1,849.10), Tata Consultancy Services (down 3.89% to Rs 880.05), Satyam Computer Services (down 2.76% to Rs 477.90), and Wipro (down 1.46% to Rs 473.55) edged lower.
Healthcare stocks rose. Ranbaxy Laboratories (up 6.53% to Rs 560.75), Cipla (up 2.13% to Rs 211.05), Dr. Reddy’s Laboratories (up 0.54% to Rs 696.50) edged higher.
Shares of oil state-run oil marketing firms rose today after witnessing heavy battering over the past few days. HPCL (up 1.86% to Rs 196.90), BPCL (up 2.24% to Rs 284.65) and Indian Oil Corporation (up 0.91% to Rs 366.55) edged higher.
Champagne Indage declined 1.24% to Rs 480. The company’s board meet will later in the day to consider raising of long term/medium term financial resources of up to $50 million in one or more tranches through various financial instruments.
European markets were weak. Key benchmark indices in France, Germany and UK were down by between 0.58% to 0.84%.
Stocks dropped in Asia after US Federal Reserve Chairman Ben Bernanke's warning on inflation on Monday, 9 June 208, fanned expectations of higher US interest rates later this year. Key benchmark indices in Hong Kong, Japan, China, South Korea, Singapore and Taiwan were down by between 1.49% to 7.73%.
The Dow staged a modest rebound on Monday from Friday's nearly 400-point drop, as concerns about US consumer spending and the troubled US housing market were eased by better-than-expected sales figures from McDonald's Corp and a surprising gain in pending home sales. The broader market was little changed, with a drop of more than $4 in the price of oil helping fuel-dependent sectors such as manufacturers, mitigating sharp losses in the financial and technology sectors. The Dow Jones industrial average was up 70.51 points, or 0.58%, to end at 12,280.32. The Standard & Poor's 500 Index was up 1.08 points, or 0.08%, at 1,361.76. But the Nasdaq Composite Index was down 15.10 points, or 0.61%, at 2,459.46.
A surge in global commodity prices led by crude oil spooked stocks across the globe in the past few days. In India, foreign funds have pressed heavy sales. FIIs sold shares worth a net Rs 2984.20 core in the first few days of this month, till 6 June 2008. They had dumped stocks worth a net Rs 5011.50 crore in May 2008. Their outflow in calendar 2008 reached Rs 18660.60 crore, till 6 June 2008. There has been heavy buying by domestic funds led by insurance firms in the past few days, but that has failed to stop the slide on the bourses.
Brokerage earnings downgrades of Indian firms/stock prices amid rising input and interest costs for India Inc, high inflation and drying up of global liquidity due to credit crisis remain major concern for the Indian stock market. If inflation remains high, the Reserve Bank of India (RBI) would be forced to hike repo rate – a move that could choke overall growth of the economy. The Indian industry and consumer have already been reeling under high interest rates over the past few months. A further hike in rates would raise interest costs of corporate India and hit bottomline.
After 10 days of debate, the Union government on Wednesday, 4 June 2008 agreed to raise retail petrol and diesel prices by about 10%, more than expected, to help curb losses at its state-owned refiners. A sharp fall in the rupee against the dollar in the past few days has heightened concerns about inflation. This is because the fall in rupee will raise cost of imports which in turn will result in further rise in inflation.
According to rating agency CRISIL, headline inflation is expected to increase by 95 basis points on account of direct and indirect effects of the fuel price hike. The indirect impact which will be felt over the course of the next few months, it states in a note.
A well distributed monsoon will bolster food production, helping douse inflation. Agricultural output in India depends on good rains. The Indian Meteorological Department (IMD)’s second monsoon forecast for the crucial annual south-west monsoon (June-September) due this months which may indicate spatial rainfall distribution in the main sowing month of July 2008, will be keenly watched by market men. The IMD has forecast the 2008 monsoon rains would be near-normal and 99% of the average between 1941 and 1990.
A section of the market is of the view that the central bank may only use the reserve requirement route to tame inflation, fearing any hike in rates would further hurt growth already seen moderating to a still strong 8%-8.5% this fiscal year from 9% in 2007/08. To rein in inflation, in its monetary policy review for 2008-09 on 29 April 2008, the RBI raised cash reserve ratio (CRR) by 25 basis points to 8.25% to suck out excess liquidity in the banking system. RBI often says pass-through of high global oil prices is incomplete in India, complicating policy making.
According to a latest monthly June 2008 strategy report by HSBC Global Research, a possibility of Left parties withdrawing support to the government at the centre over the fuel price hike issue, cannot be ruled out. In such an environment with prospects of mid-term polls, the stock market is likely to remain nervous, HSBC says. Parliamentary elections are due in India in May 2009. HSBC’s 2008 year-end (calendar year) target for Sensex is 17,500, compared to current Sensex level of 15,066.10.
Another near term trigger for the market will be corporate advance tax payments for the first installment which falls due on 15 June 2008. The income tax law requires a company to 15% the estimated tax liability for the year as advance tax in the first installment. The advance tax payment by the corporate sector will give a cue on Q1 June 2008 results.
Market may also be keeping a watch on the industrial production numbers for April 2008, which the government will unveil on Thursday, 12 June 2008, which will give a cue on the extent of slowdown in the Indian economy caused by high interest rates.
The BSE Sensex may fall to a 10-month low of around 13,000 points by end-2008, as the Reserve Bank of India may raise interest rates to check inflation due to record oil prices, Credit Suisse said on Monday, 9 June 2008. "The market is still not pricing in the much lower earnings growth being forecast by corporates and banks," Nilesh Jasani, head of research at the Indian unit of the Swiss bank told reporters at a briefing on Monday, 9 June 2008. Uncertainty ahead of national elections will also weigh on the minds of investors, Jasani said.
Source: Capital Market

Market extends fall as oil price soars

Market extends fall as oil price soars

The key benchmark indices slumped today due to a sharp surge in global crude oil price and setback in US stocks on Friday, 6 June 2008. BSE Sensex fell below 15,000 mark for the first time since 19 March 2008, in intra-day trade. The S&P CNX Nifty hit a fresh 2008 low. Except the BSE HealthCare index, all the other sectoral indices on BSE were in red. The market breadth was extremely weak. IT, realty, banking and oil & gas stocks were worst hit in today's market fall. Oil prices surged by their biggest one-day gain ever on Friday, 6 June 2008, rocketing over $10 to a new record high above $139 a barrel, taking this year's gains to 44%. Oil prices edged lower to $137.7 today, 9 June 2008. The 30-share BSE Sensex lost 444.14 points or 2.85% at 15,128.04 as per provisional data. At the day’s low of 14846.18 hit during mid-morning trade, the Sensex lost 726 points as per the provisional figures. The broader based S&P CNX Nifty was down 107.9 points or 2.33% at 4,519.90 as per the provisional figures. It hit a low of 4411.60 today in mid-morning trade, falling below 2008 low of 4448.50 hit on 22 January 2008. BSE clocked a turnover of Rs 5039 crore today compared to a turnover of Rs 5245.26 crore on Friday 6 June 2008. The market breadth was extremely weak on BSE with 475 shares advancing as compared to 2167 that declined. 49 remained unchanged. From the 30-share Sensex pack, 27 fell. The BSE Mid Cap index declined 2.55% to 6,188.35 and BSE Small-Cap index fell 3.43% to 7,432.33. BSE Healthcare index was the lone gainer from sectoral indices on BSE. It rose 0.63% to 4,322.88. Lupin (up 10.09% to Rs 715), Ranbaxy Laboratories (up 4.18% to Rs 528), Sun Pharmaceuticals Industries (up 2.56% to Rs 1,455.05) and Piramal HealthCare (up 2.12% to Rs 372.75) edged higher. Cipla (down 0.19% to Rs 207) and Dr. Reddy’s Laboratories (down 0.18% to Rs 692) edged lower. BSE Realty index was down 7.05% to 5,772.65. It was the top loser from the sectoral indices on BSE. Unitech (down 9.3% to Rs 184.80), Indiabulls Real Estate (down 6.06% to Rs 398.40) and DLF (down 7.39% to Rs 481.55) edged lower from the realty pack. IT stocks declined. Wipro (down 4.85% to Rs 480.50), Infosys (down 4.46% to Rs 1,904.05), Tata Consultancy Services (down 4.56% to Rs 915.65) and Satyam Computer Services (down 3.42% to Rs 491.45) edged lower. Banking stocks declined. HDFC Bank (down 4.34% to Rs 1,183.70), State Bank of India (down 3.17% to Rs 1292.80) and ICICI Bank (down 2.69%t o Rs 75.10) edged lower. Oil & Gas stocks fell after global crude oil prices hit the roof. PSU oil marketing companies which had found little solace after government had hiked domestic retail fuel prices were battered today. HPCL (down 9.21% to Rs 193.30), BPCL (down 7.09% to Rs 278.40), and Indian Oil Corporation (down 3.9% to Rs 363.25) edged lower. Reliance Industries (down 3.41% to Rs 2163.10) and ONGC (down 7.02% to Rs 872.60) also edged lower. India’s second largest telecom services provider by sales Reliance Communication rose 1.34% to Rs 554.10. The stock recovered from session's low of Rs 507.90. Reliance Communication (RCom) and the South African telco MTN will reportedly decide the share swap ratio at which Anil Ambani will transfer his stake in RCom to get stake in MTN. Both the companies have reportedly agreed for the deal, which will result in RCom promoter viz. the Anil Dhirubhai Group (ADAG) emerging as the single-largest shareholder in MTN and the foreign company becoming the holding firm of RCom. Jaiprakash Associates (down 8.65% to Rs 183.65), HDFC (down 5.99% to Rs 2206.65), Reliance Infrastructure (down 5.65% to Rs 1,038.85), Tata Motors (down 4.25% to Rs 517.10), Ambuja Cements (down 4.1% to Rs 81.95), Bharat Heavy Electricals (down 3.29% to Rs 1,374.65), edged lower from the Sensex pack. Rohit Ferro Tech declined 3.32% to Rs 154.90. SKP Overseas (SKP), a wholly owned subsidiary of the company in Singapore, has signed agreement with the PT. Pacific Samudra Perkasa (PSP) of Indonesia towards the 60% economic interest in both of the two mining companies PT Palopo Indah Raya (PIR) and PT Bara Prima Mandiri (BPM) as per the terms of the memorandum of understanding entered into earlier between the company & PSP. US stocks plunged on Friday, 6 June 2008, marking the Dow's worst day in 15 months, after the US government said the May 2008 unemployment rate jumped the most in 22 years and oil prices shot to another record, renewing fears that the US economy faces 1970s-style stagflation. The Dow Jones industrial average tanked 394.64 points, or 3.13% to end at 12,209.81, its biggest drop since February 2007. The S&P 500 slid 43.37 points, or 3.09%, to finish the day at 1,360.68. The Nasdaq Composite Index lost 75.38 points, or 2.96 percent, to close at 2,474.56. European markets were trading mixed today. Key benchmark indices in France and Germany were down by between 0.08% to 0.09%. The UK”S FTSE 100 however rose by 0.18%. In Asia, key benchmark indices in Japan, South Korea, Singapore and Taiwan were down by between 1.27% to 2.13% today. Markets in China, Hong Kong and the Philippines were closed for public holidays. Surging global crude oil prices, a hike in domestic fuel prices and rising inflation have spooked the domestic bourses in the past few days. Foreign institutional investors (FIIs) pressed heavy sales in the backdrop of a weakening rupee against the dollar, accentuating fall in share prices. From a recent high of 17,434.94 on 16 May 2008, the barometer index, BSE Sensex tanked 1,862.76 points or 10.68% in a short span to 15,572.18 on 6 June 2008. Brokerage earnings downgrades of Indian firms/stock prices amid rising input and interest costs for India Inc, high inflation and drying up of global liquidity due to credit crisis remain major concern for the Indian stock market. If inflation remains high, the Reserve Bank of India (RBI) would be forced to hike repo rate – a move that could choke overall growth of the economy. The Indian industry and consumer have already been reeling under high interest rates over the past few months. A further hike in rates would raise interest costs of corporate India and hit bottomline. After 10 days of debate, the Union government on Wednesday, 4 June 2008 agreed to raise retail petrol and diesel prices by about 10%, more than expected, to help curb losses at its state-owned refiners. A sharp fall in the rupee against the dollar in the past few days has heightened concerns about inflation. This is because the fall in rupee will raise cost of imports which in turn will result in further rise in inflation. According to rating agency CRISIL, headline inflation is expected to increase by 95 basis points on account of direct and indirect effects of the fuel price hike. The indirect impact which will be felt over the course of the next few months, it states in a note. A well distributed monsoon will bolster food production, helping douse inflation. Agricultural output in India depends on good rains. The Indian Meteorological Department (IMD)’s second monsoon forecast for the crucial annual south-west monsoon (June-September) due this months which may indicate spatial rainfall distribution in the main sowing month of July 2008, will be keenly watched by market men. The IMD has forecast the 2008 monsoon rains would be near-normal and 99% of the average between 1941 and 1990. A section of the market is of the view that the central bank may only use the reserve requirement route to tame inflation, fearing any hike in rates would further hurt growth already seen moderating to a still strong 8%-8.5% this fiscal year from 9% in 2007/08. To rein in inflation, in its monetary policy review for 2008-09 on 29 April 2008, the RBI raised cash reserve ratio (CRR) by 25 basis points to 8.25% to suck out excess liquidity in the banking system. RBI often says pass-through of high global oil prices is incomplete in India, complicating policy making. Another near term trigger for the market will be corporate advance tax payments for the first installment which falls due on 15 June 2008. The income tax law requires a company to 15% the estimated tax liability for the year as advance tax in the first installment. The advance tax payment by the corporate sector will give a cue on Q1 June 2008 results.

Source: Capital Market

Fears of CRR hike accentuate fall in late trade

Fears of CRR hike accentuate fall in late trade

The market failed to sustain higher level despite firm start on sustained selling pressure. Volatility was high throughout the day. Rumours that the Reserve Bank of India may hike cash reserve ratio (CRR) or interest rate later in the day to tame inflation, spooked the market. The market breadth turned negative from positive.

Global cues were positive, with European and Asian markets trading in positive zone. US markets saw a sharp rally yesterday, 5 June 2008.

Inflation based on the wholesale price index (WPI) rose 8.24% in the year through 24 May 2008, compared to previous week's rise of 8.10%. The government also revised the annual inflation rate for the year through 29 March 2008 to 7.75% as compared to 7.41% reported earlier.

Crude oil climbed close to $6 on Thursday, 5 June 2008, to more than $127 per barrel as funds shifted back into oil when the dollar fell against the euro following a signal from the European Central Bank that it may raise interest rates. The crude contract climbed another 0.3% in Asian trading today.

The 30-share BSE Sensex was down 203.62 points or 1.29% at 15,566.10, as per provisional closing. The Sensex lost 243.22 points at day’s low of 15,526.50 touched in late trade. After opening 144.69 points higher at 15,914.41, the Sensex advanced further to strike an intra-day high of 15,970.70 in early trade. At the day’s high, Sensex gained 200.98 points.

The broader based S&P CNX Nifty was down 51.60 points or 1.10% at 4,625.35 as per provisional closing.

Reserve Bank of India governor YV Reddy yesterday, 5 June 2008 hinted at a possible increase in CRR in an attempt to curb inflationary expectations

The market breadth was negative on BSE with 1516 shares declining as compared to 1142 that advanced. 64 remained unchanged. On the contrary, the market breadth was strong in early trade.

The BSE Mid-cap index was down 0.95% to 6,339.21 and the BSE Small-Cap index slipped 0.60% to 7,689.53, as per provisional closing.

The total turnover on BSE amounted to Rs 5229 crore as compared to Rs 3973 crore by 14:30 IST.

Among the 30-member Sensex pack, 25 declined while the rest advanced.

Mahindra & Mahindra (M&M), the country’s largest tractor company in terms of sales, advanced 3.07% to Rs 580 on 60,044 shares. On 5 June 2008, the company agreed to buy Italian auto designer Engines Engineering for an undisclosed sum. The stock was the top gainer from Sensex pack.

Tata Motors (up 1.37% to Rs 539.90), Infosys Technologies (up 0.73% to Rs 1994.10), and Grasim (up 1.06% to Rs 2270) edged higher from the Sensex pack

India’s largest private sector company in terms of market capitalisation and oil refiner Reliance Industries (RIL) was down 0.74% to Rs 2231.10 on high volumes of 17.10 lakh shares. The stock had surged to an intra-day high of Rs 2299 in opening trade. Reliance Industries today said only one unit at its Nagothane petrochemicals plant had been shut by a fire and others were running normally. The plant has an annual capacity of 4,00,000 tonnes of ethylene. The shut unit has annual capacity of 1,20,000 tonnes

India’s third largest software services exporter Wipro lost 4.05% to Rs 507 on 2.86 lakh shares. It was the top loser from Sensex pack.

Hindalco Industries (down 3.99% to Rs 174.65), ITC (down 3.98% to Rs 213.50) and DLF (down 3.98% to Rs 517.50), edged lower from the Sensex pack.

India’s largest state run engineering company in terms of outstanding order book Bharat Heavy Electricals declined 1.80% to Rs 1419, after striking an intra-day high of Rs 1499.95. On 26 May 2008, the company had bagged Rs 1,150-crore turnkey contract from a joint venture of HPCL and Mittal Energy for setting up an energy efficient 153 megawatt captive power plant at Bhatinda in Punjab.

India's second largest power generation company in terms of sales, Reliance Infrastructure (formerly Reliance Energy), slipped 2.29% to Rs 1105, after hitting day’s high of Rs 1163. The stock was boosted by reports that it has won regulatory approval to raise power tariff by as much as 10.22% for its 2.6 million users in Mumbai. Shares of rival power generation company Tata Power Company rose 1.86% to Rs 128.05 on reports it has also hiked tariff marginally. The new tariff will be applicable from 1 June 2008 31 March 2009.

Interest rate sensitive banking shares declined. ICICI Bank (down 1.66% to Rs 768.25) and HDFC Bank (down 1.05% to Rs 1230) declined.

India’s largest stare-run bank in terms of net profit State Bank of India fell 1.80% to Rs 1330. The bank signed an agreement with Societe Generale Securities Services, a division of Societe Generale Group, to form a joint venture company for providing custody services.

Reliance Industries was the top traded counter on BSE with turnover of Rs 386.07 crore followed by Reliance Capital (Rs 214.18 crore), Cairn India (Rs 208.51 crore), Gokul Refoils (Rs 196.95 crore), and Anu’s Labs (Rs 173.44 crore), in that order.

European markets, which opened after Indian markets pared early gains. Key benchmark indices in United Kingdom (up 0.47% to 6,023.40), France (up 0.01% to 4,907.23), and Germany (up 0.02% to 6,943.43), advanced.

Most Asian markets, which opened before Indian markets, were trading higher today, 6 June 2008. Japan's Nikkei (up 1.03% at 14,489.44), Hang Seng (up 0.61% at 24,402.18), Taiwan's Taiwan Weighted (up 0.08% at 8,745.35), Singapore's Straits Times (up 0.26% at 3,151.94), advanced. However, China's Shanghai Composite declined 0.56% at 3,332.77.

US markets rallied yesterday, 5 June 2008 on stronger-than-expected May 2008 sales by Wal-Mart and other retailers and a surprising fall in weekly jobless claims, spurring optimism about the economy's health. The Dow Jones industrial average gained 213.97 points, or 1.73%, to 12,604.45. The S&P 500 index advanced 26.85 points, or 1.95%, to 1,404.05, and the Nasdaq Composite index surged 46.80 points, or 1.87%, to 2,549.94

The European Central Bank said yesterday, 5 June 2008, it would keep key lending rates unchanged at 4%. The bank, however, anticipates inflation to be more persistent than previously anticipated. Also the Bank of England kept its benchmark interest rate unchanged at 5% yesterday, 5 June 2008.

Back home, frenzied buying coupled with short covering after three straight days of fall triggered a solid rally yesterday, 5 June 2008. The 30-share BSE Sensex jumped 254.93 points or 1.64% at 15,769.72 and the broader based S&P CNX Nifty was up 91.35 points or 1.99% to 4,676.95, on that day.

As per provisional data, foreign funds sold shares worth a net Rs 1418.34 crore yesterday, 5 June 2008. Domestic funds bought shares worth a net Rs 570.03 crore on that day.

Foreign institutional investors (FIIs) were net buyers of Rs 1054.43 crore in the futures & options segment yesterday, 5 June 2008. They were net buyers of index futures to the tune of Rs 1035.25 crore and bought index options worth Rs 405.81 crore. They were net sellers of stock futures to the tune of Rs 402.85 crore and bought stock options worth Rs 16.22 crore.

Meanwhile, market regulator Securities and Exchange Board of India (Sebi) yesterday, 5 June 2008, ruled out relaxing curbs imposed last year on participatory notes (PNs), a derivative tool that enables unregistered foreign investors to invest in Indian stock markets. In October 2007, Sebi had imposed restrictions on Foreign Institutional Investors (FIIs) to issue PNs and asked FIIs and their sub-accounts not to issue fresh PNs against underlying derivatives and wind up their existing position in 18 months.

Source: Capital Market

Market snaps three day losing streak; IT stock surge

Market snaps three day losing streak; IT stock surge

Frenzied buying coupled with short covering after three straight day's of fall triggered a solid spurt in late trade. Reports of Prime Minister's resignation had spooked a sell-off in mid-morning trade. Despite the rally, the market breadth remained negative. The market witnessed choppy swings throughtout the day. Global cues were mixed. Earlier today, the market saw firm start despite weak global cues, but slipped in red shortly on fresh selling. The market breadth was weak. Shares from oil, realty, declined while those from IT, FMCG and power rallied. The 30-share BSE Sensex ended up 250.59 points or 1.62% at 15,765.38 as per provisional figures. Sensex gained 300.01 points at its high of 15814.80 touched during late trade. It lost 200.72 points at day's low of 15,314.02, touched in mid-morning trade. The broader based S&P CNX Nifty was up 84.85 points or 1.85% to 4,670.45 as per provisional figures. The market breadth was negative on BSE with 1235 shares advancing as compared to 1404 that declined. 72 remained unchanged. The BSE Mid-Cap index rose 0.04% to 6399.81 and BSE Small-Cap index rose 0.29% to 7,742.61. Both these indices underperformed the Sensex. Among the 30-member Sensex pack, 23 advanced while the rest gained. BSE clocked a turnover of Rs 5578 crore today as compared to a turnover of Rs 6461.80 crore on 4 June 2008. IT stocks surged as the Indian rupee weakened further against the US dollar. Wipro (up 6.25% to Rs 528.40), Infosys (up 5.85% to Rs 1979.70), Satyam Computer Services (up 5.47% to Rs 512.20) and TCS (up 2.57% to Rs 982.75) edged higher. Power stocks advanced on fresh buying. Tata Power Company (up 7.79% to Rs 1256.65), NTPC (up 5.57% to Rs 166.65), Reliance Infrastructure (up 5.68% to Rs 1130.85) edged higher. Shares of upstream companies rallied after the subsidy burden that they have to bear became clear post fuel price hike announced yesterday, 4 June 2008, which had remained uncertain until now. Oil and Natural Gas Corporation soared 7.46% to Rs 953.20 and Gail India jumped 7.39% to Rs 398.30. Upstream oil companies ONGC and GAIL India absorb most of subsidy burden arising in the form of under-recoveries of oil marketing companies. The duo will now have to bear Rs 45,000 crore in subsidy burden, which is at historically high levels. However the public sector oil-marketing companies extended losses today after yesterday’s fuel price hike. HPCL (down 6.26% to Rs 226.30), Indian Oil Corporation (down 6.29% to Rs 391.90) and BPCL (down 7.01% to Rs 301.35) edged lower. FMCG stocks rose. Tata Tea (up 5.02% to Rs 816.30), Hindustan Unilever (up 3.23% to Rs 237.85), ITC (up 2.89% to Rs 222.35) edged higher. Jaiprakash Associates (up 3.68% to Rs 205.60), Grasim Industries (up 3.19% to Rs 2,246.30), Tata Steel (up 3.1% to Rs 840.90), ICICI Bank (up 3.09% to Rs 781.25), HDFC Bank (up 2.22% to Rs 1,243), were the top gainers from Sensex pack. Tata Motors (down 1.82% to Rs 532.60), Larsen & Toubro (down 1.6% to Rs 2,721.20), Ambuja Cements (down 1.89% to Rs 85.85), Reliance Industries (down 2.58% to Rs 2247.65), were the top losers from Sensex pack. Interest rate sensitive realty sector declined on fears of hike in interest rates or CRR after inflation may rally to double-digit post fuel price hike announced yesterday, 4 June 2008. Indiabulls Real Estate (down 1.6% to Rs 405.45), Phoenix Mills (down 3.99% to Rs 319) and DLF (down 3 % to Rs 538.45) edged lower from realty pack. India’s largest maker of utility vehicles, Mahindra and Mahindra (M&M) declined 0.92% to Rs 562.75. It announced signing an agreement to acquire 100% stake in Italy based Engines Engineering. Engines Engineering is in the business of two wheels design and developing of motorcycle prototype. India’s second largest telecom services provider Reliance Communications rose 1.3% to Rs 547.15. As per reports Reliance Communications and South Africa's MTN have begun due diligence as they inch closer to creating a global top-10 telecoms firm. Reliance Communications has also engaged Deutsche Bank for the possibility of roping in private equity firms for part of the deal, the source said. Blackstone Group Carlyle Group and Apax were interested to put in $4 billion to $5 billion, reports added. India’s largest cement maker by sales ACC rose 1.09% to Rs 639.70. Its cement shipments in May 2008 fell to 1.8 million tonnes from 1.82 million tonnes a year earlier. Production fell to 1.79 million tonnes from 1.82 million tonnes during the similar period. In a crucial development, government yesterday, 4 June 2008 agreed to raise its petrol and diesel prices by about 10% in an attempt to curb mounting losses of state-owned refiners thereby stoking inflation and risking a political backlash. After 10 days of debate over the price increase, the Cabinet also agreed to cut the import duty on crude oil to support state run refining and retailing firms. Customs duty on crude was also reduced to nil from 5%. The duty cuts would amount to Rs 22,660 crore in revenue loss, the Revenue Secretary said. Meanwhile, the ruling Left Front in West Bengal has called a 12-hour general strike today, 5 June 2008 in protest against the 'anti-people' decision of the Centre to raise the prices of petrol, diesel and cooking gas. Analysts opine that higher inflationary expectations immediately gave rise to fears of a cash reserve ratio (CRR) or interest rate hike, which is a negative for markets. European markets were trading mixed. Key benchmark indices from Frrance, and UK were down between 0.01% to 0.17%. While Germany’s DAX rose 0.24%. Asian markets were mixed today, 5 June 2008. Japan's Nikkei Singapore's Straits Times, South Korea's Seoul Composite, and China's Shanghai Composite, were down by between 0.08% to 0.65%. Hong Kong's Hang Seng and Taiwan's Taiwan Weighted were up between 0.55% to 1.28%. US markets ended mixed in volatile session yesterday, 4 June 2008. Banks fell to their lowest level in eight years on Fed Chairman Ben Bernanke's warning that inflation is still a concern. Financials tumbled on rumors that Moody's May Put bond insurers AMBAC and MBIA on review for a possible credit rating downgrade. The Dow Jones industrial average slipped 12.37 points, or 0.10%, to 12,390.48. The Standard & Poor's 500 index was down 0.45 points, or 0.03%, to 1,377.20, while the Nasdaq advanced 22.66 points, or 0.91%, to 2,503.14.

Source: Capital Market

Markets bleed on fears of multiyear high inflation; ONGC spurts

Markets bleed on fears of multiyear high inflation; ONGC spurts

Fears of further spike in inflation to a multiyear high post today's fuel price coupled with weak global markets created havoc on the bourses. The market witnessed choppy swings throughout the day. Stocks across the board were hammered brutally with all sectoral indices on BSE suffering losses. The market had witnessed a short lived recovery in early afternoon trade soon after the Cabinet Committee on Political Affairs (CCPA) approved the long awaited hike in fuel prices. The 30-share BSE Sensex tumbled 455.99 points or 2.86% at 15,506.57, as per provisional figures. Sensex gained 30.34 points at its high of 15992.90 hit in early trade. It lost 520.22 points at day's low of 15,442.34, touched in late trade. The broader based S&P CNX Nifty was down 134 points or 2.84% at 4,581.90 as per provisional figures. The BSE Mid-Cap index down 2.31% to 6396.31 and BSE Small-Cap index down 2.04% to 7,721.87. Both these indices outperformed Sensex. In a crucial development, government today agreed to raise its petrol and diesel prices by about 10% in an attempt to curb mounting losses of state-owned refiners thereby stoking inflation and risking a political backlash. After 10 days of debate over the price increase, the Cabinet also agreed to cut the import duty on crude oil to support state run refining and retailing firms. Customs duty on crude was also reduced to nil from 5%. The duty cuts would amount to Rs 22,660 crore in revenue loss, the Revenue Secretary said. The market breadth was weak on BSE with 700 shares advancing as compared to 1944 that declined. 75 remained unchanged. Among the 30-member Sensex pack, 29 declined while India's largest oil exploration company in terms of market capitalisation ONGC was the lone gainer. The stock surged 5.31% to Rs 887.05 on speculation that it may have to absorb lower subsidy burden after today's fuel price hike. The BSE clocked the turnover of Rs 5,551 crore today as compared to Rs 5,252.69 crore on 3 Jun 2008. India’s largest private sector company in terms of market capitalisation and oil refiner Reliance Industries (RIL) sumped 4.57% to Rs 2296.70. India's largest real estate developer in terms of market capitalisation DLF shed 4.7% to Rs 555.10. The company’s net profit rose 536.6% to Rs 2590.28 crore on 388.1% rise in sales to Rs 5532.88 crore in FY 2008 over FY 2007. Metal stocks declined. Sterlite Industries (down 6.71% to Rs 841.40), Sesa Goa (down 8.83% to Rs 3568.70), National Aluminium Company (down 1.71% to Rs 478.30), Tata Steel (down 5.36% to Rs 815.60), Hindalco Industries (down 3.09% to Rs 178.60), Steel Authority of India (down 1.69% to Rs 153.75), edged lower. Power stocks declined. Reliance Power (down 7.31% to Rs 202.80), Tata Power Company (down 7.06% to Rs 1,165.85), Reliance Infrstructure (down 4.89% to Rs 1070.10), Powergrid Corporation of India (down 2.97% to Rs 88.30) edged lower. Realty stocks slumped. Lanco Infratech (down 12.27% to Rs 416.50), Indiabulls Real Estate (down 7.29% to Rs 412.05) and Unitech (down 5.52% to Rs 207.20) edged lower. State run oil & gas stocks erased early gains to post losses despite fuel price hike. BPCL (down 7.84% to Rs 324.05), Indian Oil Corporation (down 3.61% to Rs 418.20), HPCL (down 2.9% to Rs 241.40) edged lower. The OMCs have so far reported losses of over Rs 2.25-lakh crore due to the high crude prices and in the absence of revision in the domestic retail prices. They have said they will run out of cash to import crude if the government fails to bail them out. Auto stocks were subdued post oil price hike announcement. Hero Honda Motors (down 4.26% to Rs 764), Mahindra & Mahindra (down 3.2% to Rs 571.50), Tata Motors (down 4.87% to Rs 542.50), Maruti Suzuki India (down 5.07% to Rs 746.55), and Bajaj Auto (down 4.91% to Rs 551.60) edged lower. Ambuja Cements (down 5.46% to Rs 87.50), HDFC Bank (down 5.19% to Rs 1,215.95), Bharat Heavy Electricals (down 4.99% to Rs 1471.25), DLF (down 3.85% to Rs 560), edged lower from Sensex pack. European markets which opened after Indian markets were weak. Key benchmark indices from France, Germany and UK were down by between 1.23% to 1.81%. Asian markets were trading mixed today, 4 June 2008. Nikkei 225 index Taiwan's Taiwan Weighted, South Korea's Seoul Composite and rose between 0.56% to 1.59%. However, Singapore's Straits Times, Hang Seng and China's Shanghai Composite were down by between 0.83% to 1.93%. US markets declined in volatile session yesterday, 3 June 2008 led by growing speculation that Lehman Brothers will be forced to raise more capital and a drop in oil prices pushed down energy companies. The Dow Jones industrial average declined 100.97 points, or 0.81%, to 12,402.85. The S&P 500 index slipped 8.02 points, or 0.58%, to 1,377.65, while the Nasdaq Composite index was down 11.05 points, or 0.44%, to 2,480.48. US light crude for July delivery fell 34 cents to $123.97 a barrel today, 4 June 2008, triggered by a rallying dollar as traders awaited U.S. data expected to show rising oil stocks. London Brent crude for July delivery fell 38 cents to $124.20 a barrel. Meanwhile, mutual funds have reportedly managed to increase their assets under management (AUM) by 5.36% in May 2008, helped by fresh investments in fixed income funds. The collective AUM rose by 30,576.72 crore in May 2008, according to the data released by the Associations of Mutual Fund in India (AMFI).

Source: Capital Market