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Wednesday, October 24, 2007
India now $4 trillion economy
India's economy, which swelled close to a trillion dollars last year, is actually worth four trillion dollars when measured in terms of purchasing power parity (PPP) and accounts for 6.3 per cent of the global economy, Finance Minister P Chidambaram said on Wednesday.
At market prices GDP has increased from $20 billion in 1950-51 to $912 billion in 2006-07 and is expected to cross a trillion dollars in the current year, he said, delivering a speech 'India's Socio-Economic Agenda: Development with Democracy' at the Norwegian Nobel Institute in Oslo.
PPP is a measure of the purchasing power of different currencies and the average cost of goods and services between countries.
The Finance Minister is on three-day visit to Norway. Claiming that Indian growth was no more a jobless growth story, he said since 2003-04 the average growth rate has increased further to 8.6 per cent and has seen over one crore jobs added annually.
During 1999-2000 to 2004-05, India added about 12 million people to its workforce each year. In this period, the rate of growth of employment was 2.9 per cent per year, he said.
India, after China, is the fastest growing economy of the world, and together with Brazil, Russia and China is the locomotive driving world growth, said Chidambaram.
Expressing the government's commitment for inclusive growth, he said the proportion of people living below the poverty line in India has declined from 51.3 per cent in 1977-78 to about 22 per cent in 2004-05.
Earlier, he met his Norwegian counterpart Kristin Halvorsen and the Norwegian Minister of Environment and International Development. Both the countries also decided to step up their bilateral and economic relations.
Post Market Commentary
The market ended the day on a flat note after exhibiting high volatility in the post session trading. Healthy quarterly numbers and good news from most of the companies have generated renewed buying interest across most of the key pivotals, which kept the market trading higher in the morning session. However, profit booking was witnessed during the mid session, caused a fall of more than 100 points in the benchmark index. Finally market relaxed a bit on the news that India''s stock market regulator, SEBI may allow investors not regulated in their home countries to register as foreign institutional investors if they disclose the nature of their funds and investments. Atlast, the benchmark index Sensex ended with the marginal gain of 20.07 points to close at 18,512.91, whereas Nifty closed a bit higher with a gain of 22.45 points to close at 5496.15. Further, BSE Midcap and BSE Smallcap also closed with the gains of 94.45 points and 106.66 points at 7,650.69 & 9,242.38 respectively.
BSE Metal closed with the highest gain of 380.65 points at 15,772.94. Pushed it up are JSW Steel (9.18%), Sesa Goa (5.42%), Jindal Saw (3.48%).
BSE Capital goods also followed the gaining rally to closed higher by 335.14 points at 17,112.32. Fueled it up are Suzlon Energy, with the highest gain of (9.63%), Thermax Ltd (5.81%), Areva (5.06%), Lakshmi Machinery (3.25%).
The Realty index also surged by 192.50 points to close at 9760.53. Took it up are Indiabulls Realty (13.23%), Anant Raj (5.85%), Mahindra Ges (5.29%), and Akruti Nirman (4.26%).
Along with these, BSE Bankex also closed with gain of 102.56 points at 9665.67. Scrips surged are SBI (5.25%), Canara Bank (3.49%), Union Bank (3.38%), Yes Bank (2.48%), and HDFC Bank (2.20%).
BSE IT, BSE Auto and BSE Oil & Gas remained under pressure with the loss of 54.65 points, 48.33 points and 3.61 points to close at 4,580.23, 5404.26 and 10736.91 respectively.
Market Close: volatility prevailed ahead of F&O..
Market continued yesterdays euphoria. It opened with a gap up but could not sustain due to volatile trade ahead of FNO expiry which is due tomorrow. Taking positive global cues Indian indices started with a bang. However after some time indices gave up all earlier gains as investors preferred to take profits. As per market data rollover position of derivative for October 2007 series to the November 2007 series was 42% for Sensex, while the Nifty rollover was 47%. This was lower than previous month September 2007 market wide rollover of 84% for Sensex and for Nifty 71%. Higher the rollover indicates a bullish market. It?s difficult to comment on this but volatility expected to remain high till expiry.
Except IT, Cement and Auto most of the sectors ended in mix. Consumer Durable, Metals and Realty stocks cheered in volatile session. Small and mid caps outperformed the front line indices. SBI zoomed on news that cabinet may take up rights issue in two weeks. It may get bonds in lieu of Govt shares in the rights issue. Asian markets closed mixed, European markets too trading in mixed.
The government has given an in-principle approval for SBI to raise Rs 20,000 cr through a rights issue. The Cabinet may take up State Bank of India (SBI) rights issue in two weeks. SBI may get bonds in lieu of Government share in the rights issue. Government's stake in SBI will rise if investors forsake their rights. The government has been very particular about its fiscal deficit targets. This year the government has kept the fiscal deficit target at 3.3% of GDP. So it does not want to tinker with it in any sense. So one of the options the government is looking at is that it will issue securities to SBI in lieu of its stake in the rights offer which is not a capital expenditure and will be off balance sheet and this will keep fiscal deficit numbers under check. One view in the government is that since SBI share price is in the vicinity of Rs 2,000 odd, there maybe a chance that a lot of retail investors may not use to subscribe to the rights offer and in that case the government's shares in SBI is likely to rise. According to sources they see it rising to 61-62%. This in turn will help SBI later if they follow-on public offer. Stock rallied in volatile session ended up by 5%.
ACC results have come in and they were a disappointment. There was volume growth but the realisation growth was not enough. Ambuja cement numbers were ok but the common element between the two was the rising cost pressures. For ACC it showed up in the power and fuel costs where as Ambuja had a higher employee cost (Holcim effect). Ambuja will feel the pressure of higher coal prices going ahead too. The other common element was lower than expected increase in realisation. Between the two ACC is well placed with some capacities coming on stream quickly to take advantage of the good margins near term. Ambuja is prone to higher presence in the North where the capacities are coming in place. The common element is in terms of valuations is that both are not compelling. The fear is from capacity addition expected in 2009- 2010 and 2011which could incrementally bring the lull period. That?s the worry for most cement players and more that that the risk for investment here. Near term though the next 4 quarters are likely to be the best ever and in such a scenario the stocks are unlikely to see selloffs. The period post that is where "the arrangement" may come into play and surprise the players. All said and done there are fewer players. Holcim, Birla?s who control almost 50% and at least one of them has the experience to manage such "Arrangement" though it has been in other parts of the world.
Technically Speaking: It was a volatile session for the whole day before closing. Sensex touched intraday high of 18832 and low of 18317. Overall breadth was in favor of Advances, where the Advances stood at 1532, while Declines at 1175. The turnover was pretty good at Rs 7968 cr. Sensex has a support at 18300 and 17725.
Indices close flat
The market had a flat close as traders continued to book profits ahead of the expiry of October derivative contracts. After a cautious start at 18,728, above 235 points its previous close, the Sensex came under selling pressure and slipped into the red below the 18,300 mark amid weakness in several Asian indices to touch the day's low of 18,315, down 176 points. The market stabilised by afternoon and continued its northwards journey on healthy buying in heavyweights, consumer durables and metal stocks. The market remained choppy thereafter and moved in a range with a mixed bias. The strong optimism in frontline, metal, consumer durables, and capital good stocks saw the index breach the 18,800 mark and touch an intra-day high of 18,832, up 515 points from the day's low. However, profit bookings at the close saw the Sensex end the session with a marginal gain of 20 points at 18,513, while the Nifty added 22 points to close at 5,496.
The market breadth was positive. Of the 2,785 stocks traded on the Bombay Stock Exchange (BSE), 1,558 stocks advanced, 1,173 stocks declined and 54 stocks ended unchanged. Among the sectoral indices, the CD gained 2.98% while the BSE Metal index, the BSE Realty index and the BSE CG index were up over 2% each. While, the BSE Auto index, the BSE IT index, the BSE Oil & Gas index and the BSE Teck index were marginally down.
Among the heavyweights, Reliance Energy gained 8.58% at Rs1,654, SBI soared 5.25% at Rs1,908, Tata Steel surged 2.23% at Rs915, Hindalco moved up by 2.22% at Rs189, HDFC Bank scaled up 2.20% at Rs1,506, L&T was up 2.16% at Rs3,403, NTPC advanced by 1.82% at Rs22 and Cipla gained 1.71% at Rs197. However, ONGC slipped 3.18% at Rs1,108, followed by Tata Motors, which was down 2.70% at Rs775. Infosys slumped by 2.07% at Rs1,845, Bharti Airtel shed 1.89% at Rs986 and M&M lost 1.85% at Rs760.
Over 2.75 crore Himachal Futuristic Communication shares changed hands on the BSE followed by Reliance Natural Resources (2.15 crore shares), Reliance Petroleum (1.98 crore shares), Power Grid Corporation (1.61 crore shares) and Tata Teleservices (1.38 crore shares).
Reliance Energy was the most actively traded counter with a turnover of Rs594 crore on the BSE followed by Reliance Petroleum (Rs369 crore), Reliance Industries (Rs287 crore), Reliance Communication (Rs284 crore) and Power Grid Corporation (Rs225 crore).
Hat trick of gains for Sensex
The Sensex posted gains consecutively for the third straight sessions, as investors flocked blue-chip shares, inspired by robust set of results posted by them for the quarter ended September 2007. All this came on the back of volatility, which is expected to remain high ahead of the expiry of October 2007 derivatives contracts on Thursday, 25 October 2007.
The Sebi’s board meet tomorrow 25 October 2007 to take a decision on proposals regarding P-notes, Reserve Bank of India's (RBI) mid-term review of annual policy due on 30 October 2007 and US Federal Reserve’s meeting on 31 October 2007 on interest rates, will be key events that will drive the market in the near term.
After swinging between positive and negative zones, the market closed with marginal gains. Earlier today, 24 October 2007, the market opened with a bang on continued buying interest in blue-chip stocks tracking firm global markets. But later it slipped in the red on selling pressure.
The market staged a comeback in late-afternoon trade to post decent gains. But fresh selling dragged it lower. The market breadth, however, was strong throughout trading.
European markets were trading higher, while Asian markets ended lower.
The BSE 30-share Sensex closed higher by 20.07 points, or 0.11% to 18,512.91. It opened with a 235.06-point upward gap at 18,727.90 and rallied further to strike an intra-day high of 18,832.49, before slipping to a low of 18,317.17. The broad market index moved in a band of 515.32 points for the day’s trading session.
The Sensex is now 685.75 points away from its all-time high of 19,198.66 struck on 18 October 2007.
The broader based S&P CNX Nifty outperformed its rival index BSE Sensex, as it rose 22.45 points or 0.41% at 5,496.15, powered by exclusive Nifty stocks of Reliance Petroleum (up 6.01% to Rs 178.95), and Tata Power (up 3.18% to Rs 1057.60).
The Nifty October 2007 futures settled at 5466, a sharp discount of 30.15 points as compared to spot closing.
The BSE Mid-Cap index was up 1.25% to 7,650.69 and the BSE Small-Cap index gained 1.17% to 9,242.38. Both these indices outperformed the Sensex.
Sectoral indices on BSE displayed mixed trend. Bankex (up 1.07% to 9,665.67), BSE Capital Goods Index (up 2% at 17,112.32), BSE Metal Index (up 2.47% at 15,772.94), BSE Consumer Durables index (up 2.98% to 5,124.67), BSE FMCG Index (up 0.33% at 2,135.45), BSE PSU index (up 0.28% to 8,775.61), and BSE Realty (up 2.01% to 9,760.53), outperformed the Sensex.
BSE Health Care Index (up 0.04% at 3,853.90), BSE Oil and Gas Index (down 0.03% at 10,736.91), BSE Auto Index (down 0.89% at 5,404.26), BSE IT Index (down 1.18% at 4,580.23), BSE TecK index (down 1.11% to 3,930.33), were underperformers.
Eighteen of the 30 members of the Sensex pack declined, while the rest gained. The market breadth was strong on BSE: 1,532 scrips had advanced as compared to 1,175 that declined, while 50 remained unchanged.
The total turnover on BSE at the end of the session amounted to Rs 7968 crore as compared to Rs 7418 crore yesterday, 23 October 2007.
The NSE F&O turnover spiked to Rs 107495.25 crore as compared to Rs 97393.15 crore yesterday, 23 October 2007.
Reliance Energy, the country’s second largest power utility company by sales, extended early gains and was up 8.75% to Rs 1656.50 on 36.66 lakh shares. It was the top gainer from the Sensex pack. The stock's rise follows chairman Anil Ambani's briefing to the media after market hours yesterday, 23 October 2007, that Reliance Power will be valued nearly two times its holding company, Reliance Energy, after the mega initial public offer. In its prospectus, Reliance Power has said that it would dilute 11.5% of the post-issue equity.
India’s leading bank by net profit State Bank of India jumped 5.03% to Rs 1904.05. After market hours yesterday, 23 October 2007, SBI Life Insurance Company posted net profit of Rs 14.09 crore for the first half year ended 30 September 2007 with an 80% increase in its total premium collection.
SBI Life Insurance has become the first private sector life insurance company to make profit. A 74:26 joint venture between the State Bank of India and Cardif, a BNP Paribas company, it manages assets over Rs 6000 crore.
India’s fourth largest software services exporter Satyam Computer Services retracted sharply from the day’s high of Rs 489.65. It settled 0.25% lower to Rs 460.60. Before market hours yesterday, 23 October 2007, the company reported a rise in net profit by 7.19% to Rs 417.15 crore on a 10.75% increase in sales to Rs 1948.24 crore in Q2 September 2007 over Q1 June 2006. The company revised upwards earning as well revenue guidance for FY 2008 (year ending 31 March 2008), both in rupees and dollars.
Other IT pivotals were not spared either. Infosys (down 2.31% to Rs 1839), TCS (down 1.79% to Rs 1045.10), and Wipro (down 1.46% to Rs 485) declined.
India’s largest engineering company by sales Bharat Heavy Electricals (Bhel) slipped 1.06% to Rs 2270 on profit booking after it had jumped 11.82% to Rs 2300 yesterday, 23 October 2007. Bhel said on Monday, 22 October 2007, that due to some unavoidable circumstances, the meeting of its board of directors to consider Q2 September 2007 results, scheduled to be held on 25 October 2007, is postponed to 29 October 2007.
Larsen & Toubro (L&T), the nation's largest engineering and construction company by sales, rose 2.06% to Rs 3399.70. It had surged 7.69% to Rs 3336 yesterday, 23 October 2007. On 18 October 2007, L&T said it won four orders worth Rs 452 crore for projects in Andhra Pradesh
Metal stocks firmed up on fresh buying. Hindalco Industries (up 1.86% to Rs 188.45), Jindal Saw (up 3.29% to Rs 610), and Tata Steel (up 1.95% to Rs 912.90) were the gainers from the metal pack.
India's biggest power generation firm by revenue NTPC advanced 1.75% to Rs 221.15 on reports it form a joint venture with an Indonesian coal producer to ensure fuel supplies for its projects.
India's largest private sector entity by market capitalisation and oil refiner Reliance Industries (RIL) rebounded in the green. It settled 0.25% higher at Rs 2608 on 10.99 lakh shares. It had hit an intra-day high of Rs 2651 in early trade. It had also slipped to a low of Rs 2540.25. As part of restructuring exercise, RIL has reportedly decided to hive off Reliance Fresh into a separate company, Ranger Farm, for single point accountability. Reliance Fresh sells food, fruits and vegetables and consumer products.
India’s largest oil exploration company by market capitalisation Oil and Natural Gas Corporation slumped 3.69% to Rs 1102, off its day’s low of Rs 1083. It was the top loser from the Sensex pack. The stock had surged 4.28% to Rs 1144.80 yesterday, 23 October 2007, on reports its joint venture firm ONGC-Mittal Energy had acquired a 30% participating interest in an exploration block in the Caspian Sea, Turkmenistan.
Auto stocks were under selling pressure. Tata Motors (down 2.41% to Rs 777), Mahindra & Mahindra (down 1.84% to Rs 760), Bajaj Auto (down 1.93% to Rs 2475), edged lower.
Shares from the Reliance group dominated the turnover charts on BSE. Reliance Energy was the top traded counter on BSE with turnover of Rs 593.96 crore, followed by Reliance Petroleum (Rs 368.37 crore), Reliance Industries (Rs 286.60 crore), and Reliance Communications (Rs 284.47 crore).
Among the noteable small- and mid-cap winners, BL Kashyap & Sons (up 20% to Rs 1449), Bhuruka Gases (up 20% to Rs 24.90), Hercules Hoists (up 20% to Rs 5182.60), AVT Natural Products (up 20% to Rs 105.40), and Fairfield Atlas (up 20% to Rs 67.55) surged.
Real-estate stocks gained on fresh buying on speculation that the Reserve Bank of India (RBI) may keep interest rates unchanged in its mid-term review of annual policy due on 30 October 2007. Earlier the street was expecting a 50 basis-point hike. 100 basis points equals 1%.
Shares from real estate pack advanced on fresh buying. Prominent gainers included Akruti Nirman (up 4.26% to Rs 986), Anant Raj Industries (up 5.85% to Rs 305), HDIL (up 2.18% to Rs 676.10), Mahindra Gesco (up 5.29% to Rs 571.85), and Indiabulls Real Estate (up 13.23% to Rs 633.75).
Blue Star galloped 20% at Rs 362.15 after its net profit jumped nearly 150% to Rs 45.97 crore on a 45.72% increase in sales to Rs 547.77 crore in Q2 September 2007 over Q2 September 2006. The results were declared during market hours today.
Castrol India rose 6.85% to Rs 288 on posting a 59.65 % rise in net profit to Rs 54.22 crore on a 3.56% rise in total income to Rs 439.7 crore in Q3 September 2007 over Q3 September 2006.The company announced the results during market hours today, 24 October 2007.
Cairn India soared 6.73% to Rs 204.65 on speculation that UK-based BP Plc may take over its parent Cairn Energy Plc. On successful takeover of parent, the acquirer will have to make a mandatory open offer for a 20% stake in the Indian arm.
Novartis India jumped 12.66% to Rs 327.40. Its net profit grew 70.1% to Rs 30.39 crore on 14.3% rise in sales to Rs 147.88 crore in Q2 September 2007 over Q2 September 2006. The company declared results during market hours today, 24 October 2007.
Rolta India moved up 9.76% to Rs 650.35. Earlier on 22 October 2007, the board of directors of the company had approved the proposal for issuing one bonus share for every one share held in the company
Suzlon Energy rose 9.63% to Rs 1,908.75. The company said on Tuesday (23 October 2007), that it would split its shares and list its Belgium-based group company Hansen Transmissions International NV on the London Stock Exchange.
Pidilite Industries soared 10.85% to Rs 182.50 after it reported a 69.06% rise in net profit to Rs 56.3 crore on a 19.21% increase in sales to Rs 377.2 crore in Q2 September 2007 over Q2 September 2006. The company announced the results after trading on 23 October 2007.
Union Bank of India rose 2.83% to Rs 159.90 on reporting 42.03% rise in net profit to Rs 275.78 crore on 31.21% rise in sales to Rs 2,525.65 crore in Q2 September 2007 over Q2 September 2006. The company announced the results during market hours today, 24 October 2007.
MIC Electronics slipped 5.42% to Rs 505. It posted net profit of Rs 9.84 crore in Q1 September 2007 on sales of Rs 75.43 crore. The company was listed on the exchanges on 12 January 2007. Therefore, comparable figures are not available. The company announced the numbers before market hours today, 24 October 2007.
Siemens gained 3% to Rs 1708 after it bagged a Rs 330-crore order from Tata Steel for providing power distribution network solutions for its greenfield steel plant at Kalinganagar, Orissa. The contract is to be executed by end of 2009.
GMR Infrastructure scaled up 1.86% to Rs 158.90 after GMR Hyderabad International Airport, 63% controlled by the company, entered into a joint venture with Brussels (Belgium)-based Sabena Flight Academy (SFA) to set up a modern aviation academy at Hyderabad. SFA is one of Europe’s oldest and most respected pilot training academies and trains more than 300 cadre pilots every year. The company announced the joint venture after market hours yesterday, 23 October 2007.
Firstsource Solutions edged higher by 2.51% to Rs 73.60 after its board approved raising up to $275 million through foreign currency convertible bonds. The company made the announcement after market hours yesterday, 23 October 2007.
Britannia Industries jumped 4.82% to Rs 1471.05 after its net profit surged 128.8% to Rs 48.50 crore on a 19.9% rise in sales to Rs 658.80 crore in Q2 September 2007 over Q2 September 2006. The company declared the Q2 September 2007 results after market hours yesterday, 23 October 2007.
PTC India vaulted 5.40% to Rs 106.50 on posting a 31.79% rise in net profit to Rs 11.4 crore on a 11.76% jump in sales to Rs 1473.61 crore in Q2 September 2007 over Q2 September 2006.The company announced the results during market hours today, 24 October 2007. It also recommended a hike in the limit for holdings by foreign institutional investors (FIIs) to 60% of its equity capital from the present limit of 40%.
Punjab Tractors declined 0.80% to Rs 216.35 after it posted a 4.64% fall in net profit to Rs 9.8 crore on an 8.97% erosion in sales to Rs 206.9 crore in Q2 September 2007 over Q2 September 2006. The company announced the results after market hours on 23 October 2007.
European markets reversed early losses to post marginal gains today, 23 October 2007. Key benchmark indices from United Kingdom (up 0.44% to 6,542.70), Germany (down 0.12% to 7,833.47), and France (up 0.10% to 5,710.57), slipped
Asian markets reversed early gains to slide in the red today, 24 October 2007. Taiwan Weighted (down 0.63% at 9,442.62), South Korea's Seoul Composite (down 0.75% at 1,93.46), Hong Kong's Hang Seng (down 0.15% at 29,333.53), Singapore's Straits Times (down 1.25% at 3,649.12) and Japan's Nikkei (down 0.56% at 16,358.39), declined
Market regulator Securities Exchange Board of India (Sebi), after trading hours on Monday, 22 October 2007, provided partial breather to foreign institutional investors (FIIs) on the proposed restrictions in the use of participatory notes and said it would speed up regulatory clearance for foreigners keen to invest transparently. The minimum networth criterion for a foreign individual investor, who intends to invest directly, is set at $50 million, reports suggested.
On 16 October 2007, Sebi had proposed curbs on issuance of offshore derivative instruments (ODIs), also known as participatory (P) notes, based on assets under management of FIIs and prohibited sub-accounts of FIIs from issuing P notes. Its board would meet on 25 October 2007 to take a decision on these proposals.
Wall Street shares ended with a spurt yesterday, 23 October 2007, as investors uneasy about the economy were reassured by solid earnings from blue chips including Apple and American Express Company. The Dow Jones Industrial Average surged 109.26 points, or 0.81%, to 13,676.23. The Standard & Poor's 500 index rose 13.26 points, or 0.88%, to 1,519.59 while the Nasdaq Composite index gained 45.33 points, or 1.65%, to 2,799.26.
New York's main futures contract, light sweet crude for delivery in December, was down 37 cents at $84.90 a barrel, more than five dollars below the record high of $90.07 struck on Friday, 19 October 2007. Brent crude for December delivery slipped 30 cents to $82.55, off its all-time peak of $84.88 hit on Thursday, 18 October 2007
The Sensex had posted its biggest ever-single day point gain of 878.85 points, or 4.99%, to settle at 18,492.84 on Wednesday, 23 October 2007. The broad market index's previous biggest single-day point gain was on 9 October 2007, when it had jumped 788.85 points, or 4.51%, to 18,280.24.
The broader S&P CNX Nifty had scaled up 289.70 points, or 5.59%, to 5,473.70, on 23 October 2007.
Trading Calls
Buy Punj Lloyd with a stoploss of Rs 350 for a target of Rs 475.
Buy NTPC with a stop loss of Rs 190 for targets of Rs 235 and Rs 280.
Pre Market Watch
Indian market is likely to have a positive opening for the day, as the fear related to the P-Note has decreased. Further SEBI is also harping more on the registration issue of sub account for FIIs. On Tuesday, the benchmark index Sensex registered its biggest intraday gain of 878.85 points to close at 18492.84, whereas Nifty has also made a remarkable recovery of 289.70 points to close at 5473.70. We expect that the market may trade with a relaxed mood and profit booking can be seen on yesterday''s purchase.
On Tuesday, the US markets ended in green territory as the Dow Jones Industrial Average (DJIA) closed up by 109.26 points to close at 13,676.23. Further the NASDAQ Composite & S&P 500 (SPX) index also gained 45.33 points & 13.26 points to close at 2,799.26 & 1,519.59 respectively.
Indian ADRs also performed well. In telecommunication sector, VSNL & MTNL surged (7.23%) & (4.52%) respectively. In metal sector, Sterlite Industries grew by (7.30%). In banking sector ICICI bank & HDFC bank gained (6.72%) and (7.73%) respectively. In Technology sector, Satyam increased by (12.05%) along with Wipro by (3.74%) and Infosys by (1.69%).
The major stock markets in Asia are trading firm. Hang Seng is trading with the gain of 480.63 points at 29,857.49. Along with this, Japan''s Nikkei is trading higher by 128.01 points to trade at 16,578.59. Singapore''s Straits Times index is also trading firm by 29.96 points at 3,3725.26 and Seoul Composite is up by 45.34 points to trade at 1993.32.
Yesterday, the FIIs performed mixed activity as the gross equity purchased was Rs.5580.90 (in crores), and the gross debt purchased was Rs.93.20 (in crores) as against the gross equity sold was Rs.6791.20 (in crores) and the gross debt sold was Rs.72.50 (in crores). The net investment of equity was Rs.-1210.30 (in crores) and the net debt investment was Rs.20.70 (in crores).
Today, Nifty has support at 5,403 and resistance at 5,575 and BSE Sensex has support at 18,382 and resistance at 18,716.
Market to head higher on firm global cues
The market is expected to edge higher, tracking firm global markets. The BSE 30-share Sensex posted its biggest ever-single day point gain of 878.85 points or 4.99% to settle at 18,492.84, on Wednesday, 23 October 2007. The Sensex’s previous biggest single day point gain was on 9 October 2007, when it had jumped 788.85 points or 4.51% to 18,280.24.
From its recent intra-day low of 17,171.45, touched on 22 October 2007, the Sensex has surged 1321.39 points at current 18,492.84. It is now 705.82 points away from all-time high of 19,198.66 struck on 18 October 2007.
The broader based S&P CNX Nifty jumped 289.70 points, or 5.59%, to 5,473.70, on 23 October 2007.
The market regulator Securities Exchange Board of India, after trading hours on Monday, 22 October 2007, provided partial breather to FIIs with respect to proposed restrictions on use of participatory notes and said it would speed up regulatory clearance for foreigners keen to invest transparently. The minimum networth criteria for a foreign individual investor, who intends to invest directly is set at $50 million, television reports suggested.
Asian markets advanced today, 24 October 2007. Hong Kong's Hang Seng (up 1.64% at 29,857.49), Japan's Nikkei (up 0.78% at 16,578.59), Taiwan Weighted (up 1.08% at 9,605.43), South Korea's Seoul Composite (up 2.33% at 1,993.32) and Singapore's Straits Times (up 0.81% at 3,725.26), edged higher.
Wall Street shares ended with a spurt yesterday, 23 October 2007, as investors who were uneasy about the economy, were reassured by solid earnings from blue chip names including Apple and American Express Company. The Dow Jones Industrial Average surged 109.26 points, or 0.81%, to 13,676.23. The Standard & Poor's 500 index rose 13.26 points, or 0.88%, to 1,519.59 while the Nasdaq Composite index gained 45.33 points, or 1.65%, to 2,799.26.
On 16 October 2007, Sebi had proposed curbs on issuance of offshore derivative instruments (ODIs), also known as P-notes, based on assets under management of foreign institutional investors (FIIs) and prohibited sub-accounts of FIIs from issuing P-notes. Its board would meet on 25 October 2007 to take a decision on these proposals.
Volatility is expected to remain high ahead of expiry of October 2007 derivatives contracts on Thursday, 25 October 2007. As per market data, marketwide rollover of derivative positions from October 2007 series to November 2007 series was 42% while Nifty rollover was 47%.
The RBI’s mid-term review of annual policy due on 30 October 2007, and US federal reserve’s meeting on 31 October 2007, on interest rates will be key events that will drive the market.
As per provisional data, foreign institutional investors (FIIs) purchased shares worth a net Rs 390.71 crore, while domestic institutional investors (DIIs) were net buyers of shares worth Rs 37.64 crore on Tuesday, 23 October 2007.
New York's main futures contract, light sweet crude for delivery in December, was down 37 cents at $84.90 a barrel, which is now more than five dollars below the record high of $90.07 struck on Friday, 19 October 2007. Brent crude for December delivery slipped 30 cents to $82.55, off its all-time peak of $84.88 hit on Thursday, 18 October 2007.
Trading Calls
Nifty (5474) Sup 5421 Res 5567
Buy ABB (1469) SL 1453 Tgt 1510, 1515
Buy SCI (250) SL 246 Tgt 258, 261
Buy Hero Honda (760) SL 754 Tgt 771, 775
Sell Colgate (383) SL 388 Tgt 375, 373
Sell Inox (115) SL 119 Tgt 108, 106
Grey Market - Mundra, Maytas, Religare, Varun Industries
Reliance Power 48 to 49
Mundra Port & Sez 400 to 440 250 to 260 ( One of the readers says - its RED HOT!)
MAYTAS Infra 370 130 to 140
Circuit Systems (India) Ltd. 35 5 to 7
Rathi Bars 35 3 to 4
Allied Computers 12 12 to 14
Varun Ind. 60 20 to 22
SVPCL 40 to 45 6 to 7
Religare Enterprises 170 to 190 210 to 220 (Whoa!)
Wednesday...a week later!
A committee is a thing which takes a week to do what one good man can do in an hour. - Elbert Hubbard
The big fear last week turned into big cheer yesterday. A conference call with FIIs, closed door meetings with brokers and worries get wiped out as if they never existed. Last Wednesday we had the indices crashing to circuit levels and today the markets are set to follow their northward journey at least in the early session. Choppiness will continue a day ahead of the expiry.
The Dow Jones rose 109 points to 13,676. The Nasdaq added 45 points to close at 2799.
The Indian ADRs higher. Satyam gained 12% to $30.23 on the back of good results. Sterlite, Wipro, ICICI Bank, HDFC Bank, MTNL, VSNL, Tata Motors and Dr.Reddy's rose 4-8% each to $22.05, $15.80, $59.88, $117.08, $9.25, $27.13, $20.17 and $16.43, respectively. Infosys was up 1.7% at $50.49
Asian stocks gained led by Japanese drugmakers and mining companies, after Chugai
Pharmaceutical Co. reported higher profit and metals prices rose, says a report Japan's Nikkei 225 Stock Average rose 0.8 percent to 16,578.59, while South Korea's Kospi Index advanced 2.6 percent, the biggest gain in the region.
Reliance Telecom Ltd (RTL), a subsidiary of Reliance Communications, has applied for CDMA spectrum in North East and Assam.
Suzlon to list its Belgium based group company Hansen Transmission International NV on LSE.
Expect buying in NTPC as it plans to enter in a power and coal JV with an Indonesian company.
Siemens won Rs3.3bn order for power distribution network solutions from Tata Steel for its greenfield steel plant at Kalinganagar, Orissa.
But read what the Finance Minister Palaniappan Chidambaram said in Norway - “The initial reaction (to measures on capital flows) was negative but investors and FIIs absorbed what we have done and broadly agree that it is good for the market, and good for investors in the long term. We are not imposing capital controls, we are not against any kinds of inflows, or discriminating between one flow or the other.”
Anil Ambani’s Reliance Power will be valued nearly two times its holding company, Reliance Energy, after the mega initial public offer, says a report. Also read No threat to Reliance Power IPO: ADAG
The IMF has said the fall in inflation rate and slowdown in credit growth were positive signs but the RBI must remain vigilant to prevent overheating of the India economy. "At this point I don't see or I would not assess the economy as overheating," Kalpana Kochhar, the senior Advisor in the Asia Pacific Department said.
UP sugar mills informs the state government that they would not start crushing till the sugarcane prices are rationalized or linked to sugar prices. (BS)
The Drug Controller General of India (DCGI) has asked for fresh trial of 11 drugs in therapeutic segment covering about 90 brands. (BS)
COAI has filed a suit against DoT for its decision to allow crossover spectrum allocation for both GSM and CDMA players. (BS)
Stocks like Allied Digital and Nitco Tiles may be in action today as they announce their results. The other results include: Dabur India , Hind.Motors , M U S C O , STI India , 3i Infotech , Areva T&D , Guj. Ambuja Exp , Castrol India , Aroni Commercial , Saraswati Commer , Cholamandalam DB , Inv.& Prec.Cast. , Yash Papers , Guj. Gas Company , Bihar Caustic , Hydro S&S Inds. , Shilpa Medicare , MRO-TEK , Neuland Labs. , M M Forgings , Tudor India , Dai-ichi Karkari , Subhash Silk , Indo Asian Finan , Page Industries , Lupin , Dr Reddy`s Labs. , DCW , Mysore Cement , Kovilpatti Laksh , Guj. JHM Hotels , GIC Housing Fin , Mukand Engineers , Pushpsons Inds , Macmillan India , Entertainment Nt , Sun TV Network , Navneet Publicat , Blue Star , Fulford (India) , Revathi Equipmnt , DCM Shriram Cons , Prem. Explosives , Nalin Lease Fin , Minda Inds. , Rane Engine Val. , TVS Motor Co. , Marico , Union Bank (I) , Vijaya Bank , Guj. Inds. Power , JK Lakshmi , Binny , Sakthi Sugars , Swaraj Engines , Viceroy Hotels , Pitti Lamination , Keynote Corp. , Shakti Press , Bank of Mah. , Excel Crop Care , Tele Data Infor. , Dishman Pharm. , Vikas Wsp , Cipla , Rajapalayam Mill , Diamines & Chem. , OCL India , JBF Inds. , Vybra Automet , Anant Raj Inds. , Mercator Lines , Krebs Biochem , Tanu Health Care , Advanced Micron. , Marg Constn. , Akar Tools , DMC Internationa , Kushagra Softwar , Opto Circuits(I) , F A C T , Hotel Leela Ven. , Premier , NRC , Unimers India , Himadri Chemical , Sarda Papers , Innovative Foods , Gem Spinners , Relaxo Footwear , Indian Infotech , Cyber Media Ind , S S Organics , Sadbhav Engg. , Glodyne Tech , Perfect Circle I , Tak Mach. & Lea. , Geodesic Inform. , Genesys Intl. , Jaybharat Text , P I Inds. , ESI , ASM Technologies , Ocean Agro (I) , Yenkey Drugs , Phoenix Mills , Mediaone Global , Sh. Jagdamba Pol , Axon Infotech,
Benchmark Sensex registered its biggest gains in more than a year as key bulls enjoyed a triumphant Tuesday. Markets opened with a positive gap following overnight gains from the
The rally was witnessed a day after market regulator stated that it would speed up the registration process for foreign institutional investors and would permit proprietary sub-accounts of FIIs to register for investments in India.
The IT index was the only under performing index even in such a record breaking session as traders preferred to book some profits in the IT counters. The heavyweights like Infosys, TCS and Wipro ended in negative territory.
Finally, 30-share Sensex rallied 878 points to close at 18,469. NSE Nifty rose 289 points to close at 5,473.
Suzlon spurred by over 9% to Rs1732 after the board of Directors of the company recommended 5:1 stock split also announced that they would list Hansen on LSE and also plans to raise Rs5,000cr via equity/quasi equity. The scrip touched an intra-day high of Rs1810 and a low of Rs1632 and recorded volumes of over 16,00,000 shares on NSE.
Satyam Computer gained by 3% to Rs461 after the company reported a consolidated net profit of Rs4.09bn for the fiscal second quarter versus Rs3.78bn in the same quarter of the previous fiscal year. This translates into a sequential growth of 8.14%. Net sales for the July-September 2007 quarter stood at Rs20.32bn as against Rs18.3bn in the year-ago quarter, reflecting a quarter on quarter growth of 11%. The scrip touched an intra-day high of Rs475 and a low of Rs458 and recorded volumes of over 34,00,000 shares on NSE.
LIC Housing Finance surged by over 19% to Rs269 after the company announced its plans to raise Rs6bn by selling shares to fund more loans to homebuyers. The scrip touched an intra-day high of Rs274 and a low of Rs233 and recorded volumes of over 13,00,000 shares on NSE.
Reliance Industries surged by over 7.5% to Rs2599 as the company announced that they are in talks with
BILT jumped by over 9% to Rs141 after reports stated that the company announced they would raise uncoated paper prices by Rs500 per ton in October and Star Paper, West Coast Paper and JK Paper mills are also expected to follow the suit. The scrip touched an intra-day high of Rs144 and a low of Rs131 and recorded volumes of over 8,00,000 shares on NSE.
Patni Computer slipped by 2% to Rs448. The company announced that they have entered into an accord with Birla Institute of Technology. The scrip touched an intra-day high of Rs464 and a low of Rs446 and recorded volumes of over 3,00,000 shares on NSE.
Things now appear more or less fine. The bulls may hope to extend Tuesday’s recovery following the clarifications from SEBI chief over the P-note issue. Sentiments improved on
Stocks in News:
Reliance Communications is likely to sell additional 10% in its tower arm RTIL through an IPO. (ET)
BSNL announces an investment of Rs600bn over next three years to expand GSM, broadband and WLL services. (BS)
Dhanus Technologies plans to acquire two US-based communications companies and a Chinese telecom services provider by raising Rs8bn. (ET)
Godrej Consumer Products Ltd (GCPL) is planning to raise Rs4bn through rights issue or QIP for funding acquisitions in Africa, Asia and Latin America. (FE)
Ballarpur Industries Ltd has earmarked Rs9bn to increase its capacity to 3,15,000 tpa. (BL)
Finolex Cables plans to expand its capacity to 30mn CFLs per annum with an investment of Rs300mn. Company further intends to expand capacity to 100mn CFLs in the medium term. (FE)
Arvind Mills has earmarked Rs6bn over the next three years to set up a chain of lifestyle superstores catering to different cross sections of the retail business. (FE)
Sun Pharma has been granted US FDA approval to market its generic version of Novartis Exelon, rivastigmine tartrate capsules. (FE)
M&M and International Truck and Engine Corp of the US will get possession of land from the state government for its upcoming truck plant at Chakan near Pune by Diwali. (BL)
Tata Chemicals biofuel manufacturing unit in Nanded, Maharashtra to be operational within next 12-18 months. (BL)
Suven Life Sceinces Ltd has secured three Indian product patents for its new chemical entities for treatment of disorders associated with neuro degenerative diseases. (BL)
Apollo Health Street, the BPO arm of Apollo Group, is planning an IPO to payoff the debt taken to fund its recent US$170mn acquisition of US-based Zavata. (ET)
GM India would be setting up a new facility in India to manufacture engine and transmission parts for its powertrain products. (BL)
Balmer Lawrie & Co Ltd plans to acquire medium-sized tour operating companies in India. (BL)
Fund Activity:
FIIs were net buyers of Rs3.90bn (provisional) in the cash segment on Tuesday and the local institutions bought Rs370mn.
In the F&O segment, foreign funds were net buyers of Rs21.3bn.
Major Bulk Deals:
Deutsche Bank has sold Deccan Chronicle; UBS Securities offloaded Karuturi Networks, Emerging market purchased Concor while, Morgan Stanly sold it; Citi Group sold PSL Ltd and HSBC Equity Fund offloaded PVR Ltd.
Upper Circuit:
Morepen Labs, Hind Oil Exploration, HFCL, Bombay Burmah, Gremac Infrastructure, Bag Film, Prime Focus, Bartronics, Kothari products, Radha Madhav, Carol Info, Jain Studious, Tourism Finance, Karuturi Networks, Silverline, Goldstone Tele, IID Forgings, Prakash Industries, Adani Enterprise and BF Utilities
Lower Circuit:
Jai Corp, RIIL and Marathon Nextgen
Crude continues to drop
Prices ease further and fall back to almost $85/barrel
Crude prices continued to drop today as traders speculated that Middle East tension between Turkey and Iraq had eased. Price also continued to drop after market expected that tomorrow’s weekly inventory report on crude and fuel products are expected to show a climb in inventories for week ended 19 October.
For the day ending Tuesday, 23 October, 2007, crude-oil futures for light sweet crude for December delivery closed at $85.27/barrel (lower by $0.75/barrel or 0.9%) on the New York Mercantile Exchange. Prices are up 45% on a yearly basis. Last Friday (19 October) price had peaked to $90.02/barrel after dropping later in the day.
Natural gas in New York fell on anticipation that outlook for mild weather will limit demand. Gas for November delivery fell 13 cents (1.9%) to settle at $6.761 per million British thermal units.
Against this backdrop, November reformulated gasoline ended down 2.45 cents at $2.1089 a gallon and November heating oil closed down 1.10 cents at $2.2998 a gallon.
Last week, prices continued to climb up on concern that Turkey's military may attack Kurdish bases in Iraq, which has the world's third-largest oil reserves. Since 2003, due to US invasion of Iraq, shipments of oil from northern Iraq to Turkey have been cut for most of the time because of attacks on pipelines. The problems gave birth to concerns that this might lead to slowing down of shipments as peak season is commencing and would call for more demand for meeting the peak heating demand.
At the MCX, crude oil for October delivery closed at Rs 3367/barrel, lower by Rs 64 (1.9%) against previous day’s close. Natural gas closed at Rs 295.5/mmtbu as against previous close of Rs 301.7/mmtbu, lower by Rs 6.2/ mmtbu.
OPEC planned to boost daily oil production by 500,000 barrels. OPEC's production target is 27.2 million barrels a day, beginning 1 Nov. OPEC, has decided to raise their daily output by 500,000 barrels per day, starting 1 November.
Attacks on oil facilities in Middle East and tight supplies from OPEC have bolstered crude prices this year. As per the U.S. Energy Information Administration, tight global energy supplies are expected to keep energy prices high through 2008.
Energy Department will come out with the weekly inventory report on fuel and fuel products for week ended Friday, 19 October tomorrow morning at Washington at 10.30 E.T.
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