We may go to the moon, but that's not very far. The greatest distance we have to cover still lies within us.
The bulls may have expected to soar like the Chandrayaan - the name of India's unmanned spacecraft to moon, which successfully took off this morning. However, the gravity of the situation is such that after two days of solid gains, things are likely to cool down a little. Nothing earth shaking has happened though. US stocks slid overnight as mixed corporate earnings offset the continuing softening in global inter-bank lending rates. European shares too ended lower amid growing pessimism towards earnings growth, notwithstanding the thaw in world credit markets for a third straight day. Markets in Asia have also opened on a soft note.
We expect the Indian market to open lower, as the two-day rally has largely been on account of short covering. The wide section of the market still lacks confidence to make a full-fledged return. Given the persistent uncertainty over the impact of the credit crisis on the global economy and weak macro-economic factors we will continue to advocate caution. We have miles to go before the smiles can come back.
Meanwhile, Wipro has reported a consolidated net profit of Rs9.78bn for the second quarter ended September 30, 2008 as against Rs8.98bn in the previous quarter, translating into a sequential growth of about 9%. The Bangalore-based IT major has posted consolidated net sales of Rs65.19bn for the July-September quarter compared to Rs59.81bn in the April-July quarter. Global IT Revenue for the quarter in dollar terms is at $1.11bn. The company has predicted Global IT Revenue of $1.12bn in Q3 FY09, which is flat.
FIIs were net sellers of Rs2.58bn (provisional) in the cash segment on Tuesday while the local institutions poured in Rs8.84bn. In the F&O segment, the foreign funds were net buyers at Rs9.15bn. On Monday, FIIs were net sellers of Rs8.4bn in the cash segment, taking their total outflows this year to above $11.9bn.
US stocks slumped in the wake of some missed earnings reports and bleak forecasts, especially by technology companies, giving investors a reason to step back after the previous session's big rally.
The Standard & Poor's 500 Index lost 30.35 points, or 3.1%, to 955.05. The Dow Jones Industrial Average tumbled 231.77, or 2.5%, to 9,033.66. The Nasdaq Composite Index decreased 73.35, or 4.1%, to 1,696.68.
Market breadth was negative. More than five stocks fell for each that rose on the New York Stock Exchange.
Lending rates continued to improve, helping to reassure investors that the efforts to try and stabilise global financial markets continue to bear fruit. But relief about the credit markets was countered by broader fears about a recession and the health of US companies.
Treasury prices rallied, lowering the yield on the 10-year note to 3.70% from 3.84% late on Monday. Treasury prices and yields move in opposite directions.
US light crude oil for November delivery fell $3.36 to settle at $70.89 a barrel on the New York Mercantile Exchange after hitting a 13-month low last week. Oil prices have been slowing since crude peaked at an all-time high of $147.27 a barrel on July 11.
Gasoline prices fell another 3.4 cents overnight, to a national average of $2.889 a gallon, according to a survey of credit-card activity by motorist group AAA. It was the 34th consecutive day that prices have decreased - in the past month alone, they're down more than 93 cents a gallon.
COMEX gold for December delivery fell $22 to $768 an ounce.
After the close, Yahoo reported earnings of four cents a share, versus 11 cents a year ago and short of analysts' forecasts for a profit of 9 cents per share. The company also said it will cut at least 10% of its workforce, or around 1,500 people, through the end of the year as a result of the weak economy.
Looking forward, Yahoo warned that 2008 revenue won't meet its earlier forecasts. However, shares gained 7% in extended-hours trading.
Also after the close, Apple reported fourth-quarter sales and earnings that jumped from a year ago due to strong sales of its new iPhone. Earnings topped forecasts, while sales missed expectations.
Looking forward, Apple forecast fiscal first-quarter sales and earnings that are short of analysts' projections. The company said forecasting the December quarter was a challenge because of the weak economy. Shares gained 4% in extended-hours trading.
In Europe, The pan-European Dow Jones Stoxx 600 index declined 0.5% to 220.91, snapping a two-session win streak. Germany's DAX 30 fell 1.1% to 4,784.41 and the UK's FTSE 100 dropped 1.2% to 4,229.73.
The French CAC-40 rose 0.8% to 3,477.50, with banks performing well after the French government said that it would inject 10.5 billion euros ($14 billion) into the country's top six banks.
Markets opened with a positive gap led by firm cues from the US and the Asian markets. However, nervousness in early trades saw the key indices erase early gains. However, as the day progressed buying in the IT, realty and capital goods stocks lifted the Indian bourses to end with smart gains. The BSE benchmark Sensex surged 460 points or 4.5% to close 10,683 and the NSE Nifty index was up 112 points to close at 3,234.
Among the 30-components of Sensex, 28 stocks were in the positive terrain and 2 stocks were in the red.
Titan Industries rallied by over 17% to Rs997 after the company’s net income in the three months ended September 30 rose 88% to Rs871.4mn. Sales rose to Rs10.9bn in the quarter from Rs7.11bn a year ago. The scrip touched an intra-day high of Rs1013 and a low of Rs860 and recorded volumes of over 1,00,000 shares on BSE.
Shares of Sun TV surged by over 4% to Rs173 after the company announced that it would consider buying back of equity shares on October 30, 2008. The scrip touched an intra-day high of Rs179 and a low of Rs170 and recorded volumes of over 5,000 shares on BSE.
LIC Housing Finance rallied by over 7% to Rs243 after the company announced results for the quarter ended September 30, 2008
The Company posted a net profit after tax of Rs1350.6mn (up 16%) for the quarter ended September 30, 2008 as compared to Rs1163.78mn for the quarter ended September 30, 2007.
Total Income rose to Rs7077.23mn up by 34.8% for the quarter ended September 30, 2008 from Rs5247.70mn for the quarter ended September 30, 2007. The scrip touched an intra-day high of Rs249 and a low of Rs224 and recorded volumes of over 5,00,000 shares on BSE.
Shares of Marico surged by over 7% to Rs55 after the company announced its consolidated results for the quarter ended September 30, 2008
The Group has posted a net profit of Rs471.24mn (up 11.5%) for the quarter ended September 30, 2008 as compared to Rs422.36mn for the quarter ended September 30, 2007.
Total Income increased by 30% to Rs6047.18mn for the quarter ended September 30, 2008 from Rs4643.03mn for the quarter ended September 30, 2007.
Shares of Opto Circuits advanced by over 6% to Rs148.9 after the company announced that it posted a net profit for the period of Rs567.293mn (up 104%) for the quarter ended September 30, 2008 as compared to Rs278.105mn for the quarter ended September 30, 2007.
The total income increased by 125% to Rs2203.85mn for the quarter ended September 30, 2008 from Rs977.33mn for the quarter ended September 30, 2007.
The scrip touched an intra-day high of Rs151 and a low of Rs143 and recorded volumes of over 4,00,000 shares on BSE.
Shares of Crompton Greaves surged by over 6% to Rs178 after the company announced results for the quarter ended September 30, 2008.
The group posted a net profit from ordinary activities after tax, minority interest and share of profit / (loss) of associate companies of Rs1201.2mn (up 32.1%) for the quarter ended September 30, 2008 where as the same was at Rs909.4mn for the quarter ended September 30, 2007.
Total Income rose by 32.4% to Rs21052.8mn for the quarter ended September 30, 2008 where as the same was at Rs15895.8mn for the quarter ended September 30, 2007.
Current period figures include the results of the subsidiary acquired during the current period, Consequently, the figures for the current period are not comparable with the figures of the previous period and figures for the previous period have been regrouped and reclassified, wherever necessary.
SAIL announced Q2 results for the quarter ended September 30, 2008.
The company posted a net profit from the ordinary activity after tax of Rs20096mn (up 18.1%) for the quarter ended September 30, 2008 as compared to Rs17002.4mn for the quarter ended September 30, 2007.
Total Income increased by 33.7% to Rs126609.9mn for the quarter ended September 30, 2008 from Rs94677.5mn for the quarter ended September 30, 2007
The stock down by 2.5% to Rs105 after hitting an intra-day high of Rs110 and a low of Rs101 and recorded volumes of over 26,00,000 shares on BSE.
Stick to the frontline stocks and lock in gains at higher levels. Keep some cash handy to take advantage when the market eases further. Wait for a clear signal of stability from the market before stepping up the shopping spree.