Bigwigs could swing with less volume
Big doors swing on little hinges.
Some index stocks have been witnessing wild swings, especially before close. With a day left for F&O expiry, expect more swings especially towards the end of trade. After a day's break, the market will resume trading amid some weak global cues. Oil prices surged overnight amid rumors that Iran fired on US Navy warships. However, oil cooled off as there was no conformation of the report. US stocks slumped after weak earnings from the biggest homebuilder and a big drop in consumer confidence. Indian ADRs Stocks are also down in Asia, with only the Nikkei in Japan holding firm.
Coming to the domestic market, market players will have to deal with the derivative settlement tomorrow. As usual, there will be wild intra-day swings due to the F&O expiry. But, on the whole we should be okay. Post F&O expiry, the market is likely to be rangebound and dull. The next big event will be the quarterly earnings and the annual monetary policy at the end of April.
The bulls have managed to rebound smartly from last month's crash. The big question is whether they can sustain this trend. Today, we expect a cautious to lower opening given the weakness in some regional markets. Thereafter, we expect choppiness.
TCS is going to be in focus as it has bagged an order from GlaxoSmithKline. Also, the company and the Tata Group have sold their stake in a BPO JV with US-based Sitel Corporation for US$22.2mn. Shree Precoated Steels Ltd. is likely to attract some attention as it will present the details on its future business mix between real estate and steel later today. Man Industries could see some action. The pipe maker is expected to make an announcement on Thursday pertaining to the demerger of Man Aluminium.
US stocks posted their biggest drop in two weeks after falling home prices and weaker consumer confidence deepened concern that the housing crisis will hurt economic growth.
The S&P 500 slipped 8.89, or 0.6%, to 1428.61. The Dow Jones Industrial Average decreased 71.78, or 0.6%, to 12,397.29, leaving it with a 2007 loss of 0.5%. The Nasdaq Composite Index fell 18.20, or 0.7%, to 2437.43. All three benchmarks had their steepest drop since March 13.
US light crude for May delivery jumped $5.18, or about 8%, to $68.91 a barrel in electronic trading before giving back most of those gains to trade at $64.40 a barrel, $1.47 above Tuesday's settle price on the New York Mercantile Exchange. The front-month contract was quoting 86 cents higher at $63.79 a barrel in extended trading in Asia.
COMEX gold for April delivery fell $1.40 to $662.50 an ounce. Treasury prices crept lower, raising the yield on the 10-year note to about 4.61% from 4.6% late on Monday. Bond prices and yields move in opposite directions. In currency trading, the dollar fell versus the euro and the yen.
European stocks ended mixed on Tuesday. The pan-European Dow Jones Stoxx 600 index ended 0.1% lower at 372.46. The German DAX Xetra 30 closed 0.4% higher at 6,858.34. The FTSE 100 closed nearly flat at 6,292.60 and the French CAC 40 rose 0.2% at 5,587.06.
Stocks in Latin America lost ground. In Brazil, The broader market as measured by the Ibovespa index closed down 438 points, or 1%, at 45,206.53. In Mexico, the IPC index of 35 leading issues closed down 35 points, or 0.1%, at 28,124.33.
In Asia most markets are in the red. The Nikkei was down 47 points at 17,317 while the Hang Seng declined 132 points to 19,574 and the Kospi in Seoul shed 11 points to 1441. The Straits Times in Singapore lost 35 points to 3198.
HOW MARKET FAREDBulls tire out
Unlike last week the first day of the week turned out to be reverse as bulls were on the receiving end. The BSE Bank, Auto, technology and Capital Good indexes led the down fall dragging the benchmark index Sensex to hit a low of 13090.80. Sugar stocks particularly were the star performers following reports that government would provide some incentives to sugar exporters. Finally, the 30-share benchmark Sensex declined 161 points to close at 13124. NSE Nifty fell 41 points to close at 3819. Tata Motors, HDFC Bank and Dabur were the major losers and Britannia, Colgate and MTNL were the major gainers among the 50-scrip'sof NSE Nifty.
BHEL pared its intra-day gains on back of selling pressure the scrip was down 0.8% to Rs2254. According to reports the company is planning to produce defense products for the Indian defense industry. The scrip touched an intra-day high of Rs2299 and a low of Rs2242 and recorded volumes of over 6,00,000 shares on NSE.
GAIL edged lower by 0.6% to Rs270. The Company announced that they would buy a natural gas terminal being built near a power plant formerly owned by Enron Corp. The scrip touched an intra-day high of Rs279 and a low of Rs269 and recorded volumes of over 2,00,000 shares on NSE.
ICICI Bank fell 1.8% to Rs875. Reports stated that Temasek Holdings Pte and Government of Singapore Investment Corp will get approval to each own up to 10% in the company. The scrip touched an intra-day high of Rs907 and a low of Rs870 and recorded volumes of over 15,00,000 shares on NSE.
Glenmark Pharma surged by over 4.5% to Rs619 after the company purchased more than 90% of Medicamenta a.s, a Czech drugmaker, to gain access to the market in Europe. The scrip touched an intra-day high of Rs643 and a low of Rs590 and recorded volumes of over 12,00,000 shares on NSE.
GDL gained 1.3% to Rs162 after the company formed joint Venture with Container Corp. The scrip touched an intra-day high of Rs165 and a low of Rs158 and recorded volumes of over 4,00,000 shares on NSE.
Sugar stocks were the star performers as reports stated that government has planned to give incentives to companies that export sugar. Renuka Sugar rose by over 8.5% to Rs429, Sakhti Sugar jumped by over 8% to Rs68, Balrampur Chini was up by 3.9% to Rs64 and Bajaj Hindusthan added 4% to Rs175.
Oil & Gas exploration stocks recorded smart gains as crude oil rose sharply above the $62 per barrel. ONGC gained 1% to Rs850, however Reliance Industries was down 1% to Rs1364. The Oil refinery stocks also were in momentum HPCL and IOC were among the major gainers.
Metal stocks also pared its intra-day gains as selling pressure dragged them lower. Nalco was down by 2% to Rs225, Hindalco slipped 1.8% to Rs133, SAIL fell 1.5% to Rs110 and Sterlite Industries declined 0.6% to Rs484. However, Hindustan Zinc was up 1.8% to Rs560 and Tata Steel gained 0.8% to Rs441.