Stock-specific activity may rule the roost

The market may edge lower tracking weak global markets. US stocks fell sharply on Thursday, 17 January 2008, as news of a plunge in regional factory activity and a hefty loss at Merrill Lynch further clouded an increasingly dire view of the US economy. In one of the strongest signals yet that the economy is at high risk of contracting, the Philadelphia Federal Reserve Bank said mid-Atlantic factory activity has slowed much more than expected to levels that typically signal recession.

The Q3 December 2007 results announced by India Inc. so far have been more or less in line with market expectations. Stock-specific activity may rule the roost in the near term based on expectations of results of individual firms. Some of the top brokerages expect a slowdown in earnings growth of 30-Sensex firms in Q3 December 2007.

Just a while ago, Wipro reported 11% growth in net profit as per US accounting standards to Rs 826 crore in Q3 December 2007 over Q3 December 2006. The other key results scheduled today are ITC and HDFC.

The government will release the inflation figure for the year through 5 January 2008 today. Annual inflation, based on the wholesale price index (WPI), stood at 3.5% in the year through 29 December 2007, same as the year through 22 December 2007.

Meanwhile, no decision was taken yesterday, 17 January 2008, at a meeting of the group of ministers (GoM) on fuel prices. GoM meet again later. A hike retail fuel prices will result in increase in inflation.

In Asia, key benchmark indices in Hong Kong, China, Japan, South Korea, and Taiwan were down by between 0.1% to 2.32%.

The Dow Jones industrial average plunged 306.95 points, or 2.46%, to close at 12,159.21, on Thursday. The Standard & Poor's 500 Index lost 39.95 points, or 2.91%, at 1,333.25. The Nasdaq Composite Index shed 47.69 points, or 1.99%, at 2,346.90.

FIIs sold shares worth a net Rs 2267.40 crore on Thursday, the day when Sensex lost 167 points. Domestic funds bought shares worth a net Rs 734.75 crore on that day.

FIIs were net buyers of index futures to the tune of Rs 611.60 crore on Thursday. They net bought index options worth Rs 279.71 crore. FIIs sold individual stock futures to the tune of Rs 1220.25 crore on that day.