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Tuesday, January 02, 2007

Market may remain range bound


Trading may be listless with most Asian markets remaining closed on Tuesday. US equity markets too remain closed until Tuesday (2 January 2007).

The next major trigger for the market is Q3 December 2006 results. While strong Q3 results are already factored in share prices, market players will be closely watching what the company managements have to say about outlook for Q4 March 2007 and FY 2008 (year ending 31 March 2008).

Foreign institutional investors (FIIs) are in profit booking mode. FIIs pressed sales worth a net Rs 1049.70 crore on Thursday 28 December, the day when Sensex had declined 13 points. Their net sales in December 2006 totaled Rs 3667.40 crore. This included a huge outflow of Rs 2,814 crore in a single trading session on 4 December 2006, because FIIs reported money that they had received from shares they tendered in the sponsored ADR issue of Infosys.

As per provisional data, FIIs were net sellers to the tune of Rs 7 crore on Friday 29 December, the day when Sensex had lost 59 points. FIIs were net sellers to the tune of Rs 88 crore in index-based futures on that day. They were net sellers to the tune of Rs 172 crore in individual stock futures on that day.

Asian markets were mostly in the green on Tuesday (2 January 2007). Key benchmark indices in Hong Kong, Taiwan and South Korea were up by between 0.1% to 1.2%. Stock markets in China, Japan and Singapore were closed.

US stocks slipped on Friday, the last trading day of 2006, as investors exited positions before an unplanned four-day weekend, but the Dow still finished near its lifetime high, capping off what has been a bullish year for all three major indexes. The Dow Jones industrial average fell 38.37 points, or 0.31 percent, to 12,463.15. The Standard & Poor's 500 Index declined 6.43 points, or 0.45 percent, to 1,418.30. The Nasdaq Composite Index dropped 10.28 points, or 0.42 percent, to 2,415.29.