A positive start
There's always somebody who is paid too much, and taxed too little - and it's always somebody else.
With Asian markets in a healthy states of affairs, we could see a higher opening. Bulls will take heart in a strong jobs data from the US though it does lower the chances of a Fed rate cut at least in the first half. Oil prices have softened from recent highs and are hovering under the $64 per barrel mark. Still, there could be some fire left in the oil market and one needs to keep a close eye on it. There is also the fragile US housing market that needs to be watched.
But, the main focus this week will be Infosys' results on Friday. The IT bellwether will also unveil its guidance for FY08. A lot has been said and written about the impact of the sharp appreciation in the rupee. Though some of that fear may not be entirely misplaced, things may turn out to be much better at least as far as the top software firms are concerned. On the flip side, if there is any sort of disappointment in Infosys' announcement, the already nervous market will crack further.
Since the Infosys numbers will be out only on the last trading day, we expect the market to remain choppy with lower volume. Most market observers expect the Sensex to be rangebound over the next few months. While some don't expect the Sensex to fall under 12,000, others feel it could test 11,300 levels. The levels of 12,300 on the Sensex and 3550 on the Nifty are being closely watched. If the key indices break below these levels, expect some stop losses getting triggered.
Apart from earnings what is also of significance is inflation. The latest data does show some moderation, though not as much as the market was expecting it. One thing is sure that inflation is very much likely to decelerate given the high base effect. The big question is how long will it stay below 6% before rearing its head again. We also don't know if the RBI is done with its tightening measures. The central bank is to announce its annual policy on April 24.
Making a quick buck in a short term period is getting more and more difficult. One should take a long-term view as the fundamental India story is still intact. Given the uncertainty and anxiety, one should remain cautious. Rejig your portfolio at regular intervals for the short term and keep some amount of cash always handy as there will be better bargains at dips.
FIIs were net sellers to the tune of Rs858mn (provisional) in the cash segment on Thursday. In the F&O segment, they offloaded securities worth Rs5.13bn on the same day. Foreign funds were net sellers of Rs22mn in the cash segment on Wednesday. Mutual Funds were net sellers of Rs1.05bn on the same day.
The US and European markets were shut on Friday on account of the Easter. When trading resumes today, US stocks are more likely to fall than rise as a stronger than expected jobs data is likely to make it tougher for the Fed to slash rates anytime soon. The bond market was open on Friday. Treasury bond prices tumbled, taking the yield on the 10-year note up to 4.74% from 4.67% late on Thursday. Economists from Goldman Sachs and UBS revised their Fed rate cut forecasts.
Asian markets are on a firm footing this morning, led by Japan, as regional investors cheered the surprisingly strong US jobs report. The Nikkei in Tokyo surged by 221 points to 17,706 while the Kospi in Seoul gained 13 points at 1497 and the Straits Times in Singapore advanced 41 points to 3387.
The Morgan Stanley Capital International Asia-Pacific Index added 0.3% to 146.73 at 10.46 p.m. in Tokyo. All markets open for trading gained. Stock markets in Hong Kong, Australia, New Zealand and the Philippines were closed Monday for holidays.
Bulls may extend gains
Bulls extended their recent winning streak to third trading session led by gains in the index heavy weights like Tata Steel, Reliance Energy, ICICI Bank, ABB and HLL. However, the domestic bourses couldn’t keep up with the global markets as both the key indices declined over 1.5% each. The Metal and the Banking indexes outperformed, however the Oil & Gas index was under pressure. Real Estate stocks were was in the limelight as government announced that it had lifted freeze on approval of Sez plans. The broader markets also gained with Mid-Cap and the small cap indexes gained over
Finally, the 30-share benchmark Sensex gained 70 points to close at 12856. NSE Nifty also gained 18 points to close at 3752.
Aurobindo Pharma pared its intra-day gains on back of profit booking, the scrip was marginally down by 0.3% to Rs693. The company announced that they have received the marketing authorization approval from Medicines Evaluation Board (MEB), NETHERLANDS for Lisinopril 10, 20, 30 and 40 mg tablets. The scrip touched an intra-day high of Rs708 and a low of Rs693 and recorded volumes of over 66,000 shares on NSE
Sun TV put on a good show, the scrip gained by 1.7% to Rs1526 as the Board of Directors approved stock split in its meeting. The scrip touched an intra-day high of Rs1545 and a low of Rs1500 and recorded volumes of over 1,00,000 shares on NSE
NTPC declined by 1.4% to Rs158. The company would bid for 'large' Indian Power projects and also announced that they are in talks with overseas banks to borrow $1.5bn. It touched touched an intra-day high of Rs162 and a low of Rs157 and recorded volumes of over 86,00,000 shares on NSE. However the scrip was the top gainer in the week among the 50-crip’s of NSE Nifty.
Bank of Baroda surged 4.7% to Rs213 after the company announced that they have increased its Benchmark Prime Lending Rate (BPLR) by 75 basis points from existing 12.50% p.a to 13.25% p.a with immediate effect. The scrip touched an intra-day high of Rs216 and a low of Rs202 and recorded volumes of over 8,00,000 shares on NSE.
Lupin spurred by over 3% to Rs636 after the company secured 20mn Euros from servier for Perindopril Patent. The scrip touched an intra-day high of Rs650 and a low of Rs617 and recorded volumes of over 2,00,000 shares on NSE.
Firm metal prices on LME boosted Metal stocks, Tata Steel was the star performer the scrip jumped over 6% to Rs465, Hindustan Zinc further gained ground by over 4.5% to Rs648, SAIL was up by 2.5% to Rs114 and Hindalco added 1.4% to Rs132.
Banking stocks gained momentum on back of buying interest. The Mid-Cap stocks led from front, OBC surged over 5.5% to Rs186, Union Bank spurred by 6% to Rs102 and PNB gained 3.2% to Rs440. SBI, HDFC Bank and ICICI bank were the major gainers among the heavy weights.
Oil exploration stocks were on the receiving end, Reliance Industries dropped by 0.4% to Rs1358 and ONGC was down by 0.3% to Rs846. However, refinery stocks rose BPCL advanced by 1.3% to Rs303 and HPCL surged by over 2.2% to Rs251.