Not the cry, but the flight of the wild duck leads the flock to fly and follow.
After the cry, the bulls will look for a wild duck to follow. But the topsy-turvy ride on the bourses is likely to continue, particularly with the F&O expiry tomorrow and continuing uncertainty over the sub-prime meltdown in the US. Wall Street rebound after Monday's big fall failed to cheer Asian markets which have chosen not to get carried away by the advance in US stocks. European markets finished marginally in the red. We expect a cautious-to-higher opening followed by a volatile day of trade as market players consider their options before the derivative settlement.
In the meantime, the Parliament will debate the Indo-US nuclear deal, though there won't be any voting after that. The Government is in minority on this issue, and will hence find it tough to win over the MPs. As always, Reliance shares will remain in the limelight. RIL and RNRL will be in action amid a report in a financial daily that both the camps have buried the hatchet over the gas supply controversy. One of the options is that RIL could take over RNRL. RPL will also remain in the spotlight, though it remains in the F&O curbs. Of course, there is more to the Indian market than just Reliance. Expect lots of stock centric action and wild swings.
High risk investors could look at SREI Infra, Dish TV, Bag Films, Ganesh Forgings, Bombay Rayon and Radha Madhav for a period of 6-12 months.
RSWM has approved the Scheme of Arrangement for de-merger of its strategic investment division into Bhilwara Technical Textiles Ltd. Its Board has also approved the exchange ratio of 10 shares of Re1 each in Bhilwara Technical Textiles for every 4 shares of Rs10 each held in the company.
IT People India has approved the merger of Marketplace Technologies Pvt. Ltd (MTP) and Orient Information Technology Ltd. (OITL), into the company.
US stocks rallied on Tuesday after Citigroup received a $7.5bn cash infusion and JPMorgan said Intel will benefit from robust computer demand. Citigroup's advance helped stocks rebound from Monday's carnage that brought the decline from October to 10%, the first so-called correction in four years.
Intel led semiconductor makers to their biggest gain in two weeks. Altria Group rose after Goldman Sachs advised buying companies whose profits are not linked to the US economy.
The Standard & Poor's 500 Index added 21 points, or 1.5%, to 1,428.23. The Dow Jones Industrial Average rose 215 points, or 1.7%, to 12,958.44. The Nasdaq Composite Index rallied 40 points, or 1.6%, to 2,580.8.
Market breadth was positive. About five shares rose for every two that fell on the New York Stock Exchange. Gains were broad based, with 28 out of 30 Dow stocks rising. Citigroup shares slipped despite the encouraging news. But other big financial stocks rose.
Concerns about the threat of recession remain and US stocks are bound to remain choppy in the weeks ahead of the Dec. 11 Fed meeting.
Traders are betting that the central bank will cut the fed funds rate by at least a quarter percentage point, but many on Wall Street are hoping for a bigger cut. There is also the possibility of no Fed rate cut.
After the close, Freddie Mac said it was cutting its quarterly dividend in half and that it was issuing $6bn in stock in anticipation of more losses ahead. Freddie shares fell 1.8% in extended-hours trading.
US light crude oil for January delivery fell $3.28 to settle at $94.22 a barrel on the New York Mercantile Exchange amid growing bets that OPEC ministers will agree to raise crude production when they meet in early December.
US stocks briefly stumbled after the release of the November Consumer Confidence report, which was weaker than expected.
Treasury prices tumbled as investors took profits after Monday's big rally, pushing the corresponding yields higher. That advance had pushed down the yield on the benchmark 10-year note to 3.83% - the lowest level since June 2005.
In currency trading, the dollar gained versus the euro and yen. COMEX gold for December delivery tumbled $12.50 to settle at $814 an ounce, falling along with other dollar-traded commodities.
Most regional markets in Europe also closed lower. The pan-European Dow Jones Stoxx 600 index ended with a loss of 0.4% at 354.27. The UK's FTSE 100 shed 0.6% to 6,140.70, while the German DAX 30 fell 0.5% to 7,531.35 and the French CAC-40 declined 0.4% to 5,434.17.
Latin American stocks closed higher. In Brazil, the main Sao Paulo stocks index rose 0.6% to 59,431. In Mexico, the IPC index of the 35 most-traded issues rose 0.9%, or 241.64 points, to close at 28124.65.
Asian markets were mixed this morning despite the overnight rally on Wall Street. The Nikkei in Tokyo was down 43 points at 15,179 and the Hang Seng in Hong Kong dropped 27 points to 27,182. The Kospi in Seoul and the Straits Times in Singapore were almost flat at 1855 and 3368, respectively.
Meanwhile, the yen rose against all of the world's 16 most-actively traded currencies on speculation that Japanese exporters purchased it to pay bills due at the end of the month. The yen also rebounded against the dollar, after declining 1.5% yesterday, on speculation that a Fed survey will highlight a regional slowdown in the world's biggest economy.
Volatility to prevail!
Markets ended in negative terrain after two consecutive days of gains on back of weak cues from the International markets. After opening with a negative gap benchmark Sensex rebounded and hit a high of 19,211. Thereafter the key indices traded in a range throughout the session. Finally, 30-share Sensex slipped 119 points to close at 19,127 and Nifty closed 33 points lower at 5,698
Among the BSE sectoral indices, BSE Realty index (up 1.24%) and BSE Auto index (up 1%). While, BSE Metal index (down 1.03%) and BSE Teck index (down 0.61%)
Among the 30-scrips of Sensex, RIL, ICICI Bank, Bharti Airtel and Reliance Energy were among the major laggards, While, BHEL, SBI, Bajaj Auto and TCS were among the major gainers.
Mundra Port India’s largest private port; surged on its debut, the scrip more than doubled at open. The scrip finally closed at Rs959 translating a premium of 117%. The company had come out with an issue of 4.02 crore shares and the issue price of the shares was fixed at Rs440.
The company primarily deals in providing bulk cargo services, container cargo, crude oil cargo and value-added port services. MPSEZL is the developer and operator of Mundra port located in Kutch district of Gujarat and is currently developing a multi product SEZ. The scrip touched an intra-day high of Rs1050 and a low of Rs770 and recorded volumes of over 2,00,00,000 shares on NSE.
RPL further dropped by over 3% to Rs198. According to reports Chevron Corp. may sell its 5% stake in the company to its parent Reliance Industries Ltd. The scrip touched an intra-day high of Rs205 and a low of Rs194 and recorded volumes of over 2,00,00,000 shares on NSE.
JSW Steel advanced 1% to Rs990 after reports stated that the company’s unit, JSW Energy Ltd., plans to raise up to Rs50bn through an initial share sale by April 2008 to fund expansion plans. The scrip touched an intra-day high of Rs1031 and a low of Rs979 and recorded volumes of over 14,00,000 shares on NSE.
Tata Steel ended on a flat note at Rs853. Reports stated that the company may pick up 35% stake in its newly formed Mozambique JV for a consideration of Australian $100mn, subject to regulatory approvals. The scrip touched an intra-day high of Rs862 and a low of Rs841 and recorded volumes of over 15,00,000 shares on NSE.
IVRCL Infra gained 0.5% to Rs478 after the company announced that they received orders worth Rs3.3bn from Pune and Chennai regions. The scrip touched an intra-day high of Rs484 and a low of Rs471 and recorded volumes of over 6,00,000 shares on NSE.
IFCI was trading higher by 2.7% to Rs90 following reports that the board of Directors of the company would have to consider Rs9.2bn debt given by the Union Government while finalizing how much of debt it owes to banks will be converted to equity. The scrip touched an intra-day high of Rs93 and a low of Rs85 and recorded volumes of over 3,00,00,000 shares on NSE.
Asian Hotels gained 2% to Rs639 after reports stated that the company plans to start Power Generation Biz. The scrip touched an intra-day high of Rs650 and a low of Rs580 and recorded volumes of over 2,000 shares on NSE.
Gail gained 1.1% to Rs427 after the company won right to market gas from Panna-Mukta-Tapti reports stated. The scrip touched an intra-day high of Rs430 and a low of Rs417 and recorded volumes of over 17,00,000 shares on NSE.
RCom edged lower by 0.6% to Rs684. Reports stated that the company would tie up with US based glasshouse for managed IT services and also would Rcom has forayed into remote network management according to reports. The scrip touched an intra-day high of Rs690 and a low of Rs680 and recorded volumes of over 18,00,000 shares on NSE.
What the FIIs are doing
FIIs were net sellers of Rs4.98bn (provisional) in the cash segment on Tuesday while the local institutions pumped in Rs2.98bn.
In the F&O segment, foreign funds were net sellers to the tune of Rs4.65bn yesterday.
On Monday, FIIs were net buyers of Rs4.7bn.
Stocks in News:
REL plans to arrange coal for its upcoming power plants through buyouts, acquisition of equity and assured supply contracts.
Punj Lloyd and a US-based Global Technology Investments have bought 33% stake each in a domestic aircraft maintenance firm Airwoks India.
Jaiprakash Associates in talks with the AV Birla group to acquire Bina Power Company in Madhya Pradesh.
DLF picks up majority stake in Amanresorts Group for US$400mn.
HPCL has earmarked US$2.5bn for expanding its Vizag refinery capacity to 16 million tons.
GAIL has bagged the rights to market the entire gas produced from the Panna-Mukta and Tapti fields.
Real Term Logistics, a JV between Future Capital Holdings and Aeroterm Mauritius to invest Rs7bn for setting up mega merchandising hubs and warehouses.
Sterlite Industries may increase stake in Hindustan Zinc.
Vedanta Resources is close to increasing its stake in Konkola Copper Mines in Zambia to 79.4%.
GMR Infra has entered into joint venture agreement to acquire 80% stake in Nepal-based Himtal Hydropower Company.
ICICI Bank has carried out largest securitization transaction of Rs19.3bn involving a conversion of the bank’s car loans into tradable securities.
ICICI Venture Fund pays US$800mn to buy 10-15% stake in Jaypee Infratech.
ITC plans to add 20,000 kiosks and 10 million farmers to its network by 2010.
Hotel Leela plans to open a chain of pilgrim hotels.
S Kumar Nationwide has approved the de-merger of its division Reid & Taylor into a separate subsidiary.
The Cabinet has given an in-principle approval to the Rs28bn dedicated east-west rail freight corridor.
FDI cap for private FM radio likely to be raised to 26% from 20%.
Telecom Minister A Raja is likely to hold one-to-one meetings with the CEOs of telecom companies to resolve differences over spectrum allocation.