Local equities seen opening lower

Key local benchmarks are likely to drift lower today, 10 July 2008 following weak global cues. Crude oil prices ended little changed yesterday, 9 July 2008. The focus would shift to earnings season with IT bellwether Infosys Technologies' quarterly results scheduled on Friday, 11 July 2008.

Crude oil futures ended little changed yesterday, 9 July 2008 as government data showed that a large drawdown in crude supplies last week was concentrated on the West Coast, which has little impact on futures prices. On the New York Mercantile Exchange, August crude settled up 1 cent at $136.05 a barrel.

Asian markets were trading lower today, 10 July 2008. Shanghai Composite fell 0.07% or 2.09 points at 2,918.45, Japan's Nikkei declined 0.10% or 12.64 points at 13,039.49, Hang Seng tumbled 1.21% or 264.55 points at 21,541.26, Taiwan's Taiwan Weighted lost 0.68% or 48.24 points at 7,000.01, Singapore's Straits Times fell 1.32% or 38.57 points at 2,879.05 and South Korea's Seoul Composite was down 0.52% or 7.90 points at 1,511.48

US stocks plunged yesterday, 9 July 2008 with financial stocks taking the biggest hit as concerns over the credit crisis took the spotlight again, sending cautious investors to the sidelines. The Dow Jones industrial average plunged 236.77 points, or 2.08%, to 11,147.44. The Standard & Poor's 500 index lost 29.01 points, or 2.28%, to 1,244.69, while the Nasdaq Composite index declined 59.55 points, or 2.60%, to 2,234.89.

Back home, the 30-share BSE Sensex surged 614.61 points or 4.6% at 13,964.26 and the broader based S&P CNX Nifty was up 168.55 points or 4.23% at 4,157.10, yesterday, 9 July 2008, following strong global cues and sharp fall in crude oil prices.

From a record high of 21,206.77 hit on 10 January 2008, Sensex has now lost 7,242.51 points or 34.15%. It is down 6,322.73 points or 31.16% in calendar year 2008 so far.

According to provisional data on NSE, foreign institutional investors offloaded equity worth Rs 435.54 crore while domestic institutional investors were net buyers of equity worth Rs 139.22 crore, yesterday, 9 July 2008.

Foreign institutional investors (FIIs) were net buyers of Rs 719.66 crore in the futures & options segment on 9 July 2008. They were net buyers of index futures to the tune of Rs 383.26 crore and bought index options worth Rs 136.49 crore. They were net buyers of stock futures to the tune of Rs 177.73 crore and purchased stock options worth Rs 22.18 crore

The government is expected to face a vote of confidence in parliament in the coming weeks. Samajwadi Party (SP) on 8 July 2008, said it will vote with the government in support of the nuclear deal with the United States.

Prime Minister Manmohan Singh on 7 July 2008 said that the government will go through the remaining formalities of the Indo-US nuclear deal. He also expressed confidence that UPA government will survive the trust vote and avoid early elections.

Meanwhile, deceleration in production of petroleum refinery products, electricity and cement pulled down the growth in six core infrastructure industries to 3.5% in May 2008 compared to 7.8% in May 2007, as per data released yesterday, 9 July 2008.