Bulls’ reliance on Movers & Shakers!
Checking the results of a decision against its expectations shows executives what their strengths are, where they need to improve, and where they lack knowledge or information- Peter Drucker.
Numbers don’t lie they say and the market movers and shakers will today reveal what the numbers really are. It’s the turn of some old economy heavyweights. Reliance Industries is most definitely the stock to keep an eye on as it declares its earnings for the Oct-Dec quarter. As it is the index bellwether, any movement in it is likely to have a bearing on the key indices today. Other index majors such as Reliance Energy and Ranbaxy are also reporting their results today. In short, results are likely to drive the market today. Siemens and Tech Mahindra will witness renewed action on account of quarterly numbers.
Bank of Japan is to announce its decision on interest rates today. The Japanese central bank is likely to keep rates on hold, which is a good sign for global liquidity. We expect a cautious to slightly higher opening and another a volatile day.
The bulls may be tiring a bit. Another factor that could be preventing them from getting more aggressive at this juncture is the high valuations, especially in the large cap stocks. Meanwhile, the small- and mid-cap shares have been witnessing much improved action off late. But, as usual we would like to advocate caution as these scrips tend to be much more volatile than their frontline peers. The action is turning more stock specific and in some cases sector centric with the results season now well underway.
Except Satyam, most major IT companies have announced their results. Barring Infosys, which delivered more subdued sort of results, others like TCS, HCL Tech and Wipro have exceeded most expectations. Some mid-cap IT companies like Polaris and 3i Infotech have been in the news recently amid market grapevine of stake sale.
Other Prominent Results: Siemens, Tech Mahindra, Ultratech Cement, Biocon, Canara Bank, Exide, Nicholas Piramal, Bharat Bijli, BOC India, EMCO, Gujarat State Petronet, Indorama Textiles, IOC Exchange, Liberty Shoes, Panacea Biotec, Plethico Pharma, Shree Cement, Sona Koyo, Genus Overseas, JK Lakshmi Cement, Kirloskar Brothers, KPIT Cummins, PSL, Shasun Chemicals and Unichem Labs.
FIIs were net buyers to the tune of Rs118.7mn (provisional) in the cash segment yesterday. In the F&O segment, they were net sellers of Rs168.8mn. Mutual Funds pumped in Rs718.4mn in the cash segment on Tuesday.
The IPO of Cinemax India Ltd. opens today. Among the current ones, Akruti Nirman has been subscribed 3.18 times; Global Broadcast 1.33 times; House of Pearl Fashion 0.25 times and Pochiraju Industries 0.5 times.
Champagne Indage could gain as it has acquired 650,000 shares or 52.6% stake Seabuckthorn Indage Ltd. (SIL), thus making the latter its subsidiary company w.e.f January 17.
Nissan Copper will come under pressure after SEBI asked the exchanges to withhold the profits of about 40 entities, while it probes the abnormal rise in price, volume and net deliverable quantity in the stock on December 29, the day it made its debut. The regulator has also barred brokers Matrix Equitrade, RSS Investments, Park Light Securities, Dimensional Securities, Religare Securities and H Nyalchand Financial Services from trading in the shares of the company.
Selling in technology shares dragged the Nasdaq lower on Wednesday and the Dow Jones Industrial Average gave up early gains. The Nasdaq was down 18.36 to 2,479.42. Intel put pressure on tech stocks after it reported quarterly earnings that fell from a year ago.
The Dow Jones dropped 5.44 to 12,577.15 after touching a record trading high earlier in the session. The blue-chip barometer had closed at record highs for the previous three sessions. The S&P 500 finished flat at 1,430.62 after ending at a more than six year high on Tuesday.
Among the Indian ADRs, Wipro, Satyam, Dr. Reddy's, ICICI Bank and MTNL were up sharply while VSNL and HDFC Bank slumped.
European shares ended lower. The pan-European Dow Jones Stoxx 600 index slipped 0.1% to 371.73. The German DAX Xetra 30 fell 0.2% to 6,701.70, the French CAC-40 declined 0.5% to 5,561.78, and the UK's FTSE 100 fell 0.2% to 6,204.50.
Asian stocks rose this morning on speculation that the Bank of Japan will wait until February to raise borrowing costs.
Woodside Petroleum, Australia's No.2 oil producer, and Inpex Holdings, Japan's No.1, rose after crude oil prices rebounded from the lowest in 19 months. Samsung fell after Apple's profit forecast trailed expectations.
The Morgan Stanley Capital International Asia-Pacific Index gained 0.3% to 140.75 as of 12:15 p.m. in Tokyo, set for its highest since Jan. 4. Nine of the measure's 10 industry groups advanced. Markets rose around the region, except in China, Hong Kong and Thailand.
Japan's Nikkei 225 Stock Average climbed 57 points to 17,318 while the Hang Seng in Hong Kong lost 19 points at 20,044. The Kospi in Seoul added 2 points to 1382 and the Straits Times in Singapore advanced 11 points to 3049.
Insider Trades:
IFCI Limited: Morgan Stanley & Co. International Limited a/c Morgan Stanley Dean Witter Mauritius Co. Ltd has purchased from open market 2,000,000 equity shares of IFCI Limited on 15th January, 2007.
Micro Technologies (India) Limited: Dr. P. Sekhar, Chairman & Managing Director has sold in open market 100000 equity shares of Micro Technologies (India) Limited on 15thn January, 2007.
Market Volumes:
The turnover on NSE was up by 5% to Rs87.66bn. BSE FMCG index was the major loser and lost 0.74%. BSE Metal index (down 0.30%) and BSE Auto index (down 0.26%) were among the other major losers. However, BSE Bank index gained 1.09%.
Volume Toppers:
IFCI, RNRL, SAIL, IDBI, Prism Cement, 3i Infotech, Nagarjuna Fertilizers, IDFC, Cairn India, Balrampur Chini, DCB, R Com, Tech Mahindra, Hindustan Motors, Aftek Ltd, Ispat Industries, Zee News, Unitech, Ashok Leyland and Rolta.
Upper Circuit Filters:
Texmaco, Heritage Food, Goldiam International, ABG Shipyard, Radha Madhav, Tanla, Crest Animation, Ganesh Housing, IOL Broadband, Nirlon and VIP Industries.
Delivery Delight:
3i Infotech, ABG Shipyard, Aurobindo Pharma, Bajaj Hindustan, Balrampur Chini, Bata India, BPCL, Bharati Shipyard, Dr Reddys Laboratories, HPCL, i-Flex Solutions, Indian Overseas Bank, IndusInd Bank, IDFC, ING Vysya Bank, Jet Airways, Larsen & Toubro, Mahindra Gesco, NIIT Technologies, Prithvi, Reliance Communications, Reliance Industries, RPL, Tata Motors, TV Today and Zee Telefilms.
Brokers Recommendations:
HCL Tech - Buy from Emkay with target of Rs810
Bajaj Auto - Outperform from CLSA with target of Rs2827
Long Term Investment:
i-flex
Major News Headlines:
Krebs Bio to sell 14.9% stake to Ranbaxy at Rs85 per share
ONGC may invest in a US $1bn refinery in Yemen
ABG Shipyard gets major order from Pacific First Shipping
ABG Shipyard plans to raise US $125bn
IFCI to sell 21% stake in ICRA in IPO
L&T in venture with Turki of Saudi Arabia
BHEL to meet on Jan 25 to consider interim dividend
CMC says Board hasn't discussed merger with TCS
BRFL hikes FII investment limit to 40%, raises Rs2.94bn from QIP
LT Overseas signs MoU with MPSIDC
Kale Consultant wins order from Direct Logistics
Citigroup, Goldman Sachs to buy stake in ICSA India
Lupin Q3 profit at Rs560.3mn (26.7%), sales at Rs4.93bn (up 15%)
Lupin to set up 100% subsidiary in Netherlands
Indiabulls promoter Sameer Gehlaut picks up stake in BAG Films