Slow down and enjoy life. It's not only the scenery you miss by going too fast - you also miss the sense of where you are going and why.
We missed joining in the global rally. Relax, there is no point expecting some fast gains. A smart opening may be in the offing. Use the same to book some profit. We see the indices settling lower from their opening levels. Settlement for stocks bought on October 27 and October 28, 2008 will be done today.
Meanwhile, the Fed played to the market gallery and cut key interest rates by 50 basis points. How low can it go from 1% is the big debate. This move by the Fed raises hopes of a repo rate cut in the near term. To boost to the mood, inflation has fallen to 10.68 pc and it won't be long before it reaches single digit. The cooling crude prices too add to the comfort.
Reports indicate that inflation numbers may be declared once a month starting next calendar year. Chances are the data will be more realistic as a host of prices would be added and changes would be made to the base year. Liquidity pumping could gain further momentum if recent reports are to be believed. A financial daily stated that the government is considering converting funds impounded under the market stabilization scheme (MSS) into regular borrowing. Such a move, if it does happen, could allow banks to lend to other borrowers instead of the lending to the government.
FIIs, who still have a substantial holding in the Indian market continue to remain net sellers. Reports state they may have sold less than 20 of their holdings so far. And imagine, that has crashed the indices to these levels.
The Finance Minister P Chidambaram will meet the heads of public sectors banks and financial institutions, on Nov 4 to review their performance for the second quarter ended September 2008.
Sterlite Industries could see action as it is showing renewed interest to acquire Asarco, says a report.
Assurances have reportedly come in from TCS and Infosys that they will not retrench any of their employees.
US stocks gained as easier credit and a report showing the economy shrank at a slower pace than expected in the third quarter brought some cheer.
The Dow Jones added 190 points, or 2.1%. The Standard & Poor's 500 index rose 2.6% and the Nasdaq was up 2.5%.
In other global news, the US Gross domestic product, fell at an annual rate of 0.3% in the third quarter after growing at a 2.8% rate in the second quarter. The drop was not as bad as expected bringing some relief to the market. Exxon Mobil reported a profit of $14.83 billion, the biggest quarterly profit in US history.
American Express announced that it will cut 7,000 jobs, or more than 10% of its staff, amid the ongoing credit crisis. The dollar fell against the euro and gained versus the yen.
US light crude oil for December delivery fell $1.54 to close at $65.96 a barrel on the New York Mercantile Exchange. COMEX gold for December delivery fell $15.50 to settle at $738.50 an ounce.
Bharti Airtel, BL Kashyap,Bombay Ray, DCB, DLF,GTL Infra, GVK Power,Hindalco, HPCL,India Cement,ING Vysya, IVRCL,Kesoram, Maytas,Nestle, Onmobile, PNB,Power Grid,Puravanakara, Ranbaxy, RCom,Shoppers Stop,Tata Motors and Unitech will report results today.
F&O expiry and speculations of the US FEDs decision on the interest rate kept the Indian markets highly volatile. After extending gains in the early trades key indices witnessed wild gyrations throughout the trading session. Alternate bouts of buying and selling often tossed the Indian bourses in the positive and negative terrain. Finally, the BSE benchmark Sensex gained 36 points or 0.4% to close 9,044 and the NSE Nifty index was up 12 points to close at 2,697.
Alok Industries reported net sales of Rs6.98bn for the quarter ended 30 September 2008, a jump of 50.21% over the corresponding quarter of the previous year (Rs4.64bn). Sales for the six months ended 30 September 2008 stood at Rs12.41bn - a 40.50% increase over the same period of the previous fiscal (Rs8.83bn)
Export Sales for the second quarter stood at Rs2.61bn, representing a 29.67% increase over the Rs2.01bn achieved during the quarter ended 30 September 2007. At a cumulative level, export sales for the half-year ended 30 Sep 2008 reached Rs4.59bn - an increase of 18.02% over the figure reported for the six months ended 30 September 2007 (Rs3.89bn). The stock ended lower by 2.3% to Rs17.7 after hitting an intra-day high of Rs19 and a low of Rs17 and recorded volumes of over 2,00,000 shares on BSE.
Educomp rallied by over 6% to Rs2026on the back of huge volumes. The scrip touched an intra-day high of Rs2400 and a low of Rs1830 and recorded volumes of over 7,00,000 shares on BSE.
L&T pared all its gains and ended with losses, the stock was down 1.5% to Rs763. According to reports, the company would set up heavy engineering facility in Oman to manufacture high-pressure heat exchangers and reactors. The scrip touched an intra-day high of Rs815 and a low of Rs751 and recorded volumes of over 8,00,000 shares on BSE.
M&M advanced by 8% to Rs302 after reports stated that the company would spend Rs3bn towards the brand building and promotion for launching vehicles in US.
The company also came out with its quarterly results.
The gross revenues and other income for the quarter ended 30th September 2008 grew by 19.1% to Rs77.41bn from Rs65.02bn in Q2 last year. The profit before exceptional items and tax for the quarter is Rs6.23bn as compared to Rs6.94bn in Q2 of FY08.
During the period there was also an exceptional profit of Rs331mn that accrued to the group out of the private placement of shares by group subsidiaries, Mahindra Retail Pvt Ltd and Mahindra Residential Developers Ltd. The consolidated profit after tax for Q2 after deducting minority interests is Rs3.73bn as against Rs3.92bn earned in Q2 previous year.
Reliance Capital gained by 2.5% to Rs635. According to reports, the company awaits an approval from NHB and RBI for its housing finance and consumer finance business. The scrip touched an intra-day high of Rs665 and a low of Rs620 and recorded volumes of over 21,00,000 shares on BSE.
Markets players would keep a close track of the overnight developments in the US markets specially the decision of the Federal Reserve on interest rates. Avoid any fresh buying unless you want to pick up stocks for the long term. Thursday being a holiday, you never know how global markets shape up as we open on Friday morning.
SAIL looking for new iron ore mines and renewal of its existing mines (FE)
Sterlite Industries is showing renewed interest to acquire Asarco (ET)
Telenor acquires 60% stake in Unitech’s telecom arm for Rs61.2bn (ET)
Tata Chemical postpones its expansion plans by atleast six months (DNA)
Political unrest in Sri Lanka has created hurdles for NTPC’s 500MW imported coal-based power project (FE)
Strides Arcolab to roll out 32 anti-cancer products over the next six months (BL)
Videocon Industries is looking at repositioning brands (BL)
Hinduja Foundries to set-up fourth foundry at Toopran with an outlay of Rs1.5bn (BL)
HCL Infosystems bagged a multi-year contract from Delhi Police (BL)
Religare promoters to hike stake via rights issue to 73% (BS)
Essar Steel is mulling a cut in production, if government doesn’t bring back the import duty on steel coming into India (DNA)
Hindustan Zinc keeps zinc and lead prices unchanged (BS)
IOB to raise Rs11bn through bonds issue (ET)
NDTV signs an exclusive distribution deal with ITV to launch its new channel (BS)
TCS and Infosys assures Karnataka government that they will not retrench any of their employees (BL)
Turkcell in talks to acquire 51% stake in Datacom Solutions (ET)
DoT plans to cap number of operators in each circle (FE)
EGoM defers its final decision on IT sops for SEZ units (FE)
Petroleum ministry asks finance ministry to issue Rs150bn of additional oil bonds (FE)
Fed cuts benchmark rate by 0.5% to 1% and reduces the discount rate to 1.25% (BL)
India’s inflation for the week ended October 18 falls to 10.68% from 11.07% in the previous week (ET)
Government in discussion with exporters on an incentive package for sustaining export growth (ET)
Government exploring a proposal to cut custom duty on ATF to 2.5% (ET)
RBI allows NBFC’s to raise funds by issuing perpetual debt instruments (FE)
Government is planning to capitalize banks by subscribing to preference shares (DNA)
Government is examining possibilities of cut in fuel prices (DNA)