Global cues need not always be followed
Doubt is part of all religion. All the religious thinkers were doubters.
The markets have off late been religiously following just global cues and discounting any positives that may be in the Indian market. This time around there seems to be selling or rather to an extent some basket selling taking place at higher levels. Going by Tuesday's movements looks like some more pressure could develop at higher levels. So remain cautious as the indices swing wildly. The market is expected to be rangebound and lackluster with low volume. The next big development is going to be the latest quarterly results. Till then, we'll have the intermittent bouts of buying and selling with no clarity on direction.
FIIs were net buyers of Rs1.47bn (provisional) in the cash segment yesterday. However, on Monday they offloaded stocks worth Rs2.5bn. In the F&O segment yesterday, foreign funds pumped in Rs5.66bn. Mutual Funds were net buyers of Rs330.7mn on Monday.
US stocks gained on Tuesday, rising for a second straight session as investors welcomed a strong report on housing starts.
Consumer and utility shares lifted the S&P 500 to its best two-day gain since August after a home construction report reassured investors that the world's largest economy is growing without fueling inflation.
Duke Energy rose the most this year, while Wal-Mart posted its biggest gain in a month, pushing the Dow Jones Industrial Average to its second straight advance. The Nasdaq Composite closed at its March high, led by SanDisk and Juniper Networks.
The S&P 500 rose 8.88, or 0.6%, to 1410.94. The Dow increased 61.93, or 0.5%, to 12,288.10. The Nasdaq added 13.80, or 0.6%, to 2408.21.
New housing starts in the US climbed more than expected in February, easing concern that a housing slump is slowing economic growth. The government also said building permits fell.
Investors awaited the outcome of the two-day policy meeting of the Federal Reserve. The central bank is widely expected to keep rates on hold for a sixth consecutive meeting, maintaining its federal funds rate target at 5.25%. However, traders will focus on the accompanying statement for hints on whether the Fed is inclined to cut rates should the US economy turn weaker.
The dollar fell against the yen and euro, surrendering early gains on fresh concerns over the US subprime-lending market and after a news that China will stop stockpiling foreign-exchange reserves.
US light crude oil for April delivery rose 14 cents to settle at $56.73 a barrel in volatile trading on the New York Mercantile Exchange. The front-month contract was quoting 30 cents higher at $59.55 a barrel in extended trading in Asia.
COMEX gold for April delivery rose $4.70 to settle at $659 an ounce. Treasury prices rose, lowering the yield on the 10-year note to about 4.54% from 4.56% late on Monday.
European shares turned higher. The pan-European Dow Jones Stoxx 600 index climbed 0.7% at 366.89. Banking stocks were up 0.9% after ABN Amro and Barclays confirmed that they were in merger talks. The UK's. FTSE 100 closed up 0.5% at 6,220.30, the German DAX Xetra gained 0.4% to 6,700.29 and the French CAC-40 added 0.8% to 5,503.27.
Most Asian markets were up for a third day on Wednesday, with Australia and Singapore leading the region higher. Investors bought BHP Billiton and other resource-related shares following gains in base-metal prices. Sydney's S&P/ASX 200 was up 0.3% at 5,896.10 in morning trading while Singapore's Straits Times Index was up 0.7% at 3,137.11.
Japanese financial markets are closed for a public holiday. Hong Kong's Hang Seng was down 16 points at 19,340 while the Kospi in Seoul advanced 6 points to 1437. The H-share index, a gauge of Hong Kong-listed shares in China companies, was up 0.3%.
In the emerging markets, the Bovespa in Brazil rose 1.5% to 44,350 while the IPC index in Mexico surged 1.9% to 27,407 and the RTS index in Russia was down 0.8% to 1831.
In metals, copper prices extended a rally to a three- month high on optimism that demand for the metal will rise in the US following the housing report
Rally fizzles out
Markets ended in positive territory for the second straight day although the markets gave up some gains towards the end finally closing near the days low. Once again global cues directed the key indices at open today lower oil prices also aided the market to open in green. The Banking, Pharma, Aviation and Cement stocks led from the front and the Mid-Cap and the small cap stocks also contributed.
Further, decision of Bank of Japan to keep the interest unchanged also lifted the sentiment on D-Street aiding the benchmark Sensex to hit an intra-day high of 12798.80. Finally, the 30-share benchmark Sensex gained 60 points to close at 12705. NSE Nifty was up 18 points to close at 3697. MTNL, Infosys and Britannia were the major losers however, Ranbaxy, REL and BPCL were the major gainers among the 50-scrip’s of NSE Nifty.
Ranbaxy was in the limelight after a very long time the scrip jumped by over 6% to Rs336 on reports that the company has opted out of Merck unit bid because of higher valuations. The scrip was the top gainer among the 50-scrip’s of NSE Nifty touching an intra-day high of Rs343 and a low of Rs318 and recorded volumes of over 23,00,000 shares on NSE.
Jet Airways was flying higher as US light crude oil for April delivery fell 52 cents to settle at $56.59 a barrel on the New York Mercantile Exchange. The scrip surged by over 8% to Rs632 touching an intra-day high of Rs639 and a low of Rs584 and recorded volumes of over 4,00,000 shares on NSE.
Oil & Gas refinery stocks were on the move. BPCL nearly by 4% to Rs319, IOC spurred over 3.5% to Rs419 and HPCL advanced by 2.5% to Rs264. Oil exploration stocks also were up Reliance Industries gained 0.7% to Rs1322.
Metal stocks were a mixed bag. Hindalco surged by over 3.6% to Rs133, Sterlite Industries rose 1% to Rs445 and Hindustan Zinc was up 1% to Rs569. However, Tata Steel lost 1.5% to Rs423 and
Auto stocks were under some pressure. Hero Honda declined 0.8% to Rs635, Bajaj Auto slipped 0.6% to Rs2501, Tata Motors edged lower by 0.4% to Rs769 and TVS Motors declined 1% to Rs62.
Technology stocks witnessed profit booking as India's Rupee rises for fourth day to an 18-month high. Heavy weight Infosys slipped 1.5% to Rs2055, Wipro was down by 0.9% to Rs573, Rolta declined 3.5% to Rs254 and HCL Tech dropped 0.6% to Rs301.