He who trims himself to suit everyone will soon whittle himself away.
Pleasing everyone is not on the agenda of SEBI. The market regulator has stood firm with SEBI Board upholding the draft norms on offshore derivative instruments (ODIs). While there are positives and facilities for wider participation, the short term anxiety and uncertainty surrounding the issue, especially with regards to hedge funds will remain. And SEBI is not done with the issue. Expect more announcements over a period of time.
As a result, there will be fresh volatility ahead. The street is divided, with some players expecting slowdown in overseas capital inflows and others not too perturbed. Right now, it seems that only the market will show the way forward. We maintain our earlier view of short-term pain and long-term gains, as outlook for the Indian economy remains strong. Bulls will hope the short term means just for the opening session! Intra-day gyrations will remain the order of the day.
After the P-Note issue, the market will now wait for the outcomes of the RBI meeting, on Oct. 30 and the Federal Reserve's meet, on Oct. 31. What the two central banks do will have a bearing on the market. All the more reason for one to be on guard though selective purchases at lower levels can be undertaken. And, don't forget the global trends, especially how the US economy shapes up in the face of the subprime contagion.
Prominent Results Today: Advanta, Allsec Tech, Andhra Bank, Apollo Tyres, Asahi India, AstraZeneca Pharma, Avaya Global, Bata India, BEML, Bharat Bijli, BEL, Bharat Forge, Cadila Healthcare, Clutch Auto, Colgate, CRISIL, Dabur Pharma, Dalmia Cement, Deccan Chronicle, Dredging Corp, Educomp, Emkay Shares, GVK Power, HCC, HDFC, HT Media, ITC, i-flex, ICSA India, ICI India, Indian Hotels, Jindal Stainless, JK Cement, Jyoti Structures, Kale Consultants, Kotak Bank, Lanco Infratech, L&T, Moser Baer, Nagarjuna Fertilizers, Piramyd Retail, Pratibha Industries, Raymond, Tata Steel, Thomas Cook, Tulip IT, TV Today and Valecha Engineering.
US stocks fell for a second day, led by financial shares such as AIG, Countrywide Financial and Merrill Lynch amid persistent worries about the downturn in the housing sector and its broader fallout on the financial markets.
Record high oil prices coupled with lackluster earnings and economic reports fueled investors' nervousness about the health of the world's largest economy.
AIG tumbled to the lowest since August on speculation that the world's largest insurer will report big write-downs related to sub-prime mortgages. Countrywide, the biggest US home-loan company, dropped to a four-year low. Merrill posted its steepest two-day decline since 2002.
Stocks also fell after government reports showed an unexpected drop in durable goods orders and initial unemployment claims topped economists' forecasts, fueling concern that the US economy may slip into a recession.
The S&P 500 Index finished nearly flat at 1,514.4. The Dow Jones Industrial Average lost 3 points, or 0.02%, to 13,671.92. The Nasdaq fell 24 points, or 0.9%, to 2,750.86.
Crude oil rose to a record above $91 per barrel in New York on an unexpected drop in US stockpiles and concern that supply from the Middle East may be disrupted. New US sanctions against Iran, the Turkey-Iraq showdown and a weak dollar helped push prices higher.
Light, sweet crude for December delivery rose as much as 64 cents, or 0.7%, to $91.10 a barrel in after-hours electronic trading on the New York Mercantile Exchange, the highest since trading began in 1983. It traded at $90.97 at 9:26 a.m. Singapore time. Prices are up 51% in a year.
Brent crude oil for December settlement rose as much as $1.32, or 1.5%, to a record $88.80 a barrel in London. It was at $88 a barrel at 9:06 a.m. Singapore time. The contract closed yesterday up $3.11, or 3.7%, at $87.48 a barrel.
Treasury prices ended little changed after an erratic session on Wall Street. In currency trading, the dollar fell against the euro and yen. Comex gold rose $5.40 to $771 an ounce.
After the closing bell, Microsoft reported quarterly earnings that beat analysts' estimates, sending its shares up 5% in extended trading. The Dow component also said it was pumping $240mn in social networking site Facebook, edging out rivals Google and Yahoo, and plans to expand its advertising deal with the site.
European shares advanced. The pan-European Dow Jones Stoxx 600 index rose 1.2% to 381.83, with the telecom sector up 3.7%. The UK's FTSE 100 closed 1.5% higher at 6,576.30, the German DAX 30 gained 1.3% at 7,932.44 and the French CAC-40 advanced 1.5% to 5,760.30.
Latin American equities closed mixed. In Sao Paulo, the Bovespa slipped 0.5% to 62,341.49 and in Mexico City, the IPC index lost 0.5% to 1,886.10. Argentine and Chilean stocks finished higher.
In other emerging markets, the RTS index in Russia rose 1.3% to 2,151 and the ISE National-30 index in Turkey was up marginally at 70,521.
Asian stocks advanced this morning, led by technology shares after Sony and Acer reported earnings that exceeded analysts' estimates and Microsoft raised its profit forecast. BHP Billiton and CNOOC gained as crude oil rose above $91 a barrel for the first time. Metal prices climbed the most in two weeks.
The Morgan Stanley Capital International Asia-Pacific Index rose 0.9% to 166.31 at 11:22 a.m. in Tokyo. An index of consumer discretionary stocks climbed 2.1%, the biggest gain among the 10 industry groups on the regional gauge, which is headed for a 0.3% gain for the week.
Japan's Nikkei 225 Stock Average advanced 0.6% to 16,383.88. South Korea's Kospi index climbed 1.4%, the biggest gain in the region, while Singapore's Straits Times Index rose 1.1%. Asian stock benchmarks rose in all markets open for trading except in New Zealand.
PN proposal may dampen mood
Markets had a strong session as bulls once again managed to dominate in the session. Despite a weak start healthy buying in Metal, Bank and Auto stocks lifted the benchmark Sensex to hit a high of 18,900 mark. However, profit booking was witnessed towards the fag end of the session dragging the markets from their respective highs.
Finally, the 30-share Sensex ended 257 points higher to close at 18,770. NSE Nifty closed 72 points higher to close at 5,568.
Sterlite Industries surged by over 6% to Rs937 after the government announced that they have set up panel on the company’s plan to acquire Balco stake. The company also announced that they were seeking to buy remainder of Balco from Indian government. The scrip touched an intra-day high of Rs942 and a low of Rs870 and recorded volumes of over 34,00,000 shares on NSE.
Hindustan Zinc ended flat at Rs830. The company announced that they have lowered lead prices by 2.8% to Rs1,60,400 per ton. The scrip touched an intra-day high of Rs850 and a low of Rs826 and recorded volumes of over 60,000 shares on NSE.
3i Infotech dropped 3% to Rs135. The company announced that they have hiked FY08 revenue guidance from Rs1150 to Rs1250 and have hiked their FY08 net profit guidance to Rs175cr from Rs165cr. The scrip touched an intra-day high of Rs143 and a low of Rs132 and recorded volumes of over 18,00,000 shares on NSE.
HDFC marginally slipped 0.6% to Rs2528. The company announced its plans to raise Rs5bn through sale of three year bonds having a coupon rate of 8.95%. The scrip touched an intra-day high of Rs2550 and a low of Rs2480 and recorded volumes of over 7,00,000 shares on NSE.
Wockhardt ended flat at Rs425 .The company announced that they have acquired US based specialty drugs company Morton Grove Pharmaceuticals for an undisclosed price. The scrip touched an intra-day high of Rs437 and a low of Rs428 and recorded volumes of over 1,00,000 shares on NSE.
Dabur Pharma slipped 1.1% to Rs63. The company yesterday announced that they have signed an agreement with Spanish generic company Combino Pharm to supply and distribute generic oncology products in the Spanish market. The scrip touched an intra-day high of Rs65 and a low of Rs63 and recorded volumes of over 87,000 shares on NSE.
Bharti Airtel advanced 2.2% to Rs1018 after 52 lakh shares of the company changed hands on NSE at Rs999.80 per share. The scrip touched an intra-day high of Rs1032 and a low of Rs980 and recorded volumes of over 1,00,00,000 shares on NSE.
Stocks in News:
- Bajaj Auto will lead the three-way global alliance with Renault-Nissan for the US$3,000 small car project.
- Reliance Retail launches its first wellness store in Hyderabad.
- Genpact beats Firstsource to bag Citigroups’ captive BPO operations.
- Goldman Sachs and Macquarie to buy 40% equity in PTC Financial Services, the investment arm of PTC India.
- Hindujas plan to sell 10% of its equity holding in Ennore Foundries.
- GMR Infra to bid for airport projects in East Europe.
- Wockhardt to launch Asia’s first recombinant human insulin- Wosulin in US and Europe.
- RPG group plans for a major restructuring and reorientation of operations with Rs150bn infusion.
- NTPC plans to acquire overseas coal mines to meet demand.
- GAIL plans to foray into gas pipeline construction business.
- Gujarat State Fertilizers and Chemicals has set a capex of Rs5bn.
- BEML has bagged Rs11.4bn contract from Delhi Metro Rail Corporation.
- Government set to ask companies to issue shares to foreign investors within a fixed period.
- DoT unlikely to allocate 1900MHz in 3G play to CDMA players in the near term.
- Government seeks 50% cut in bound rates on industrial goods.
- The Group of Ministers have finalized the proposed Rs7.3bn crop insurance scheme for tea, rubber, tobacco and spices.
- Planning Commission proposes to set up a National Electricity fund to enable generate resources for improving the power distribution network in the country.
- The Model Production Sharing Contract has incorporated the Empowered Group of Ministers (EGom) recommendation on gas pricing in its seventh round of the NELP.
Fund Activity:
FIIs were net sellers of Rs6.25bn (provisional) in the cash segment on Thursday and the local institutions bought shares worth Rs7.88bn.
In the F&O segment, foreign funds were net sellers at Rs1.29bn.
On Wednesday, FIIs pumped in Rs18.61bn in the cash segment. Mutual Funds were also net buyers of Rs3.39bn.
Major Bulk Deals:
Goldman Sachs has picked up Ahluwalia Contracts; DSP ML has bought Arvind Mills; UBS has purchased Balrampur Chini; ABN AMRO has sold Bombay Rayon; HSBC Financial has bought GTL Infra; Credit Suisse has picked up GVK Power; Deutsche Bank has sold JBF; Citigroup, ABN AMRO and Prudential Asset Management Singapore have purchased Maytas Infra; Deutsche Securities have picked up Mercator Lines; BNP Paribas has bought Mount Everest Mineral Water; Edelweiss has sold Spentex; Merrill Lynch has purchased Subex Azure.