Man is the only animal whose desires increase as they are Fed; the only animal that is never satisfied.
After a rewarding week, the bulls may find it difficult to sustain the positive momentum this week. The two big events - F&O expiry and the Fed meeting - are both taking place on Thursday. June has been pretty volatile after strong gains of the past couple of months. This is because FII inflows have been indifferent. Global markets too have been volatile due to concerns about inflation and interest rates. Oil prices have inched higher towards the $70 per barrel mark. Despite last week's rally, we urge caution as the underlying sentiment lacks strength and conviction.
Fresh buying should be avoided at this stage as the near-term direction looks uncertain. Stay in cash for better days ahead. Lots of stock centric action is expected to continue. We see a lower opening today. Friday's cooling off coupled with weakness on Wall Street and Asian markets will help the bears make an appearance at least. Having said that there is a chance of a rebound later in the day.
US stocks ended down on Friday, with the Dow Jones Industrial Average sliding 1.4%, on the back of renewed concerns over sub-prime mortgages and nervousness over interest rates.
The Dow was down 185.58 points to 13,360.26. The broader S&P 500 (down fell 19.63 to 1,502.56, while the tech-laden Nasdaq dropped 28 points to 2,588.96.
For the week, the Dow and S&P both lost about 2%, while the Nasdaq shed 1.4%.
European shares ended lower on Friday. The pan-European Dow Jones Stoxx 600 index slipped 0.3% to 392.43. The German DAX 30 earlier this week broke through 8,000 and closed at its highest level since March 2000. On Friday, the DAX lost 0.2% at 7,949.63, the UK's FTSE 100 slipped 0.4% to 6,567.40 and the French CAC-40 inched down 0.1% at 6,023.25.
In the emerging markets, the Ibovespa in Brazil gave up 0.7% at 54,267 while the IPC index in Mexico was down 0.6% to 31,642 and the RTS index in Russia rose 0.15% to 1896.
Asian markets were trading mixed. While the Nikkei in Tokyo, the Hang Seng in Hong Kong and the Straits Times in Singapore were in the red, stock indices in Shanghai, Taiwan and South Korea advanced.
FIIs were net sellers to the tune of Rs282.3mn (provisional) in the cash segment on Friday while domestic institutions pumped in Rs5.12bn. In the F&O segment, foreign funds were net buyers of Rs753.9mn. On Thursday, FIIs were net buyers of Rs16.42bn in the cash segment. However, this includes proceeds from the DLF issue. Mutual Funds poured in Rs1.49bn on the same day.
Markets lost ground after surging for three consecutive trading sessions as selling pressure in the index heavy weights like BHEL, Reliance Industries, Tata Steel and Satyam Computer dragged the key indices to close in red. Bulls looked to be tiring out as it struggled to further gain ground.
The Oil & Gas and the Metal index were the major losers both the indices lost nearly by 1%. Finally, the 30-share Sensex slipped 31 points to close at 14467. NSE-50 Nifty was down 15 points to close at 4252
Educomp rallied by nearly by 7% to Rs2295 after the company announced that it has raised $80mn via FCCB at conversion price of Rs2949.83 per share. The scrip touched intra-day high of Rs2359 and a low of Rs2071 and recorded volumes of over 13,00,000 shares on NSE.
Ranbaxy marginally slipped by 0.4% to Rs355. The company secured approval from US FDA for Tamsulosin. The scrip touched intra-day high of Rs359 and a low of Rs353 and recorded volumes of over 2,00,000 shares on NSE.
RNRL surged by over 3.5% to Rs35 as the Bombay High Court has ruled that Reliance Industries cannot sell gas from its KG basin fields to a third party other than NTPC and RNRL. The scrip touched intra-day high of Rs36 and a low of Rs34 and recorded volumes of over 27,00,000 shares on NSE.
IID Forging gained by 1% to Rs737 after the company announced that they would consider stock split on June 30. The scrip touched intra-day high of Rs744 and a low of Rs715 and has recorded volumes of over 7,000 shares on NSE
Metal stocks lost ground, Hindustan Zinc slipped by 3.8% to Rs722, SAIL was down by 1.4% to Rs134, Tata Steel slipped by 1.3% to Rs601, Sterlite Industries lost 2.3% to Rs584 and Jindal Steel declined 1% to Rs3509.
Technology stocks also were on the receiving end led by heavy weight Wipro as the scrip was down by 1.5% to Rs517, Infosys slipped 0.6% top Rs1948 and Satyam Computer declined by 1% to Rs463.
Select Banking stocks also . SBI has surged by 2% to Rs1474, HDFC Bank is up by 1% to Rs1111 and ICICI Bank has added 1% to Rs957. Union Bank of India, Corp bank and Bank of Baroda are the major gainers among the Mid-Cap stocks.
Oil & Gas also lost ground on back of selling pressure. HPCL was down 0.6% to Rs272, ONGC slipped 0.6% to Rs909, IOC dropped 2% to Rs438.
Results Today:
Andhra Petro, Ansal Infra, BEML, Celebrity Fashions, CESC, Lumax Auto, Munjal Auto, Nirlon, ONGC, SAL Steel and Sical Logistics.
Major Bulk Deals:
Morgan Stanley has bought JM Financial from Fidelity; Merrill Lynch has picked up Man Industries; Citigroup has purchased Prime Securities; Macquarie Bank has bought Raipur Alloys; Reliance Capital has picked up Rico Auto while Morgan Stanley has sold the stock; Deutsche Securities has purchased Sun Pharma and SBI Life Insurance has picked up Sundaram Finance.
Insider Trades:
Swaraj Engines Ltd: Reliance Tax Saver (ELSS) Fund - Schemes of Reliance Mutual Fund has purchased from open market 5490 equity shares of Swaraj Engines Ltd on 20th June 2007.
Praj Industries Ltd: Pramod Chaudhari, Chairman has sold in open market 72550 equity shares of Praj Industries Ltd on 19th and 20th June, 2007.
UFLEX Limited: A.R. Leasing Private Limited (part of the promoters' group) has purchased from open market 1300 equity shares of UFLEX Limited on 18th June, 2007.
Lower Circuit:
Saregama, Tripex Overseas, Rama Pulp and Tanla.
Upper Circuit:
Swan Mills, TCI Finance, Rasoi, Yashraj Securities, Flawless Diamond, Vyapar Industries, Malu Paper, Amara Raja, Ashapura Minechem, Goldstone Tech, Crisil, Heritage Foods, Global Broadcast and PBA Infrastructure.
Delivery Delight (Rising Price & Rising Delivery):
APIL, Ashok Leyland, Bank of India, Dr Reddys Laboratories, GAIL, Hindalco, HLL, Indian Hotels, Moser Baer, Nicholas Piramal, SBI and Sun Pharmaceuticals.
Abnormal Delivery:
Hindustan Motors, Balaji Telefilms, HCL Technologies, EIH, Tata Steel, Wipro, Nagarjuna Fertilizers, Eicher Motors, Siemens, IDBI, Gujarat Alkalies, ITC, Indian Petrochemicals Corporation Ltd and Federal Bank.
Major News & Announcement:
Inflation for week ended June 9 was at 4.28% vs expectations of 4.45%
Govt to buy RBI’s stake in SBI for Rs355.3bn
Educomp raises $80mn via FCCB at Rs2949.83 per share
Chidambaram says too early to reach conclusion on inflation
Punjab Chem to borrow funds for overseas acquisition
IID Forging to consider stock split on June 30
Ranbaxy gets approval from USFDA for Tamsulosin
Trinity Capital to buy 1.7% stake in Phoenix Mills
Bank of India to buy 76% stake in Indonesia PT Bank
Gayatri Project gets two orders worth Rs8.8bn