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Friday, May 16, 2008
Post Market Commentary - May 16 2008
Indian market closed higher due to the positive cues from global markets that led the investors to take fresh positions during the trading session. The Indian markets opened on a strong note but was unable to sustained at the higher levels as the profit booking prevailed. The volatility gripped the since the initial bell as the declaration of the inflation figures was round the corner. The inflation for the week ended 3rd May 2008 surged to its highest level in nearly 4 years to 7.83% as against 7.61% reported last week. But at last the market managed to regain its momentum to close in the positive territory. From the sectoral front, the metal and bankex stocks were in limelight because most of the buying was seen from these baskets. The market breadth was positive as 1547 stocks closed in green while 1137 stocks closed in red.
The BSE Sensex closed higher by 81.40 points at 17,434.94 and NSE Nifty closed up by 42.45 points at 5,157.70. The BSE Mid Caps and Small Cap closed higher by 49.45 points and 73.85 points at 7,129.70 and 8,620.26 respectively.
Gainers from BSE are Ranbaxy Lab (3.29%), Reliance Communication Ltd (2.18%), HUL (2.14%), HDFC Bank Ltd (1.77%), J P Associates (1.69%), SBI (1.39%) and ICICI Bank Ltd (1.34%).
Losers from the BSE are Ambuja Cement (1.07%), Infosys Tech (1.07%), Housing Development Finance Co (0.95%), TCS Ltd (0.94%), Bharti Airtel (0.57%), and Cipla Ltd (0.56%).
The Metal index advanced by 317.64 points to close at 17,058.01. Gainers are JSW SL (7.48%), Steel Authority (7.33%), Gujarat Nre C (6.05%), Sterlite Induastries (2.59%), Ispat Industries (1.83%) and Nat Aluminum Co (1.28%).
The Banking index closed up by 135.27 points at 8,941.28. Gainers are Punjab National Bank (6.09%), Bank of India (5.69%), Kotak Bank (2.02%), Central bank (1.93%), HDFC bank Ltd (1.77%) and CBOP (1.64%).
The Capital Goods Index closed higher by 95.95 points at 13,696.75. Gainers are Kirloskar Oil Eng (6.10%), Suzlon Energy (5.61%), Elecon Eng (2.25%), Lakshmi Ma W (1.47%), Aiaengineer (1.38%) and L&T (1.14%).
The Oil & Gas index ended higher by 83.82 points at 11,289.58. Gainers are Aban Offshore (7.95%), Bharat Petroleum Corporation Ltd (5.59%), Cairn India (4.14%), Hindustan Petroleum Corporation Ltd (3.76%) and Indian Oil (2.71%).
The Health Care index moved forward by 35.49 points to close at 4,321.48. Gainers are Matris Lab (7.70%), Lupin Ltd (5.05%), Bil Care Ltd (3.52%), Ranbaxy Lab (3.29%), Sun Pharma Ltd (2.52%), and Cadila Healthcare (1.71%).
Market may trade in a range
The market is likely to be rangebound in the absence of any major domestic trigger, with Q4 March 2008 results nearing end. The market has reached a stage where liquidity will pull the prices up and valuations will keep them under control. The market will have its bit of volatility due to these two opposing forces. It will test the patience of investors and the nerves of the traders.
Next week is a curtailed trading week as the market remains closed on Monday, 19 May 2008, on account of Buddha Pournima.
Inflation data will be closely watched as it remains as a major worry and hindrance for the domestic growth. High inflation may compel the government to take more fiscal measures to rein in prices in addition to slew of measures taken recently.
The wholesale price index rose 7.83% in 12 months to 3 May 2008, higher than previous week's annual rise of 7.61%, government data released on 16 May 2008, showed. It was the highest since an annual reading of 7.93% n 6 November 2004. The annual inflation rate was 5.74% during the corresponding week of the previous year.
The government has taken a slew of fiscal measures such as ban on export of cement and non-basmati rice, cut in import duty on some items and imposition of export duty on some steel items to rein in rising prices.
Foreign institutional investors (FII) have, so far, sold shares worth Rs 529.10 crore this month, till 14 May 2008. They sold shares worth Rs 10,887.20 crore in calendar year 2008, till 14 May 2008. Domestic funds sold shares worth Rs 639.80 this month, till 14 May 2008.
The BSE Sensex rose 697.87 points or 4.17% to 17,434.94 in the week ended Friday, 16 May 2008. The S&P CNX Nifty rose 175.10 points or 3.51% to 5157.70 in the week.
The BSE Mid-Cap index rose 137.04 points or 1.96% at 7,129.70 in the week. The BSE Small-Cap index rose 114.62 points or 1.35% at 8,620.26.
Brigade Enterprises zooms
Brigade Enterprises rose 12.54% to Rs 215.40. It topped gainers in BSE’s A group shares. The company’s reported net profit of Rs 21.41 crore on sales of Rs 128.11 crore in Q4 March 2008. Figures for the corresponding previous year period were not available. The company announced the results on 24 April 2008.
Chambal Fertilisers and Chemicals rose 8.57% to Rs 79.20. It was the second biggest gainer in A group. The company’s net profit rose 268.4% to Rs 19.38 crore on 22.2% rise in sales to Rs 596.95 crore in Q4 March 2008 over Q4 March 2007. It announced the result on 15 May 2008.
Aban Offshore rose 7.95% to Rs 3,889.65. It was the third biggest gainer in A group. The company’s net profit rose 17% to Rs 34.55 crore on 65.5% rise in sales to Rs 196.39 crore in Q4 March 2008 over Q4 March 2007. It announced the result on 29 April 2008.
JSW Steel rose 7.48% to Rs 1,110.95. It was the fourth biggest gainer in A group. The company said on 14 May 2008 its crude steel production jumped 14% to 2.84 lakh tonnes in April 2008 over April 2007. The company achieved 33% growth in production of rolled long products segments to 34,000 tonnes in April 2008 over April 2007.
Steel Authority of India rose 7.33% to Rs 185.90. It was the fifth biggest gainer in A group. The company reported 24.97% rise in net profit to Rs 2376.76 crore on 30.42% increase in total income to Rs 13855.25 crore in Q4 March 2008 over Q4 March 2007. Steel Authority of India (Sail)’s net profit rose 21.52% to Rs 7536.78 crore on 17.59% increase in total income to Rs 41517.04 crore in the year ended March 2008 over the year ended March 2007. It announced the results during trading hours today, 16 May 2008.
Market shrugs off weak industrial production data
The key benchmark indices soared last week shrugging off weak industrial production data, high inflation and soaring global crude oil prices. Depreciating domestic currency against the dollar boosted export driven IT stocks.
The BSE Sensex rose 697.87 points or 4.17% to 17,434.94 in the week ended Friday, 16 May 2008. The S&P CNX Nifty rose 175.10 points or 3.51% to 5157.70 in the week.
The BSE Mid-Cap index rose 137.04 points or 1.96% at 7,129.70 in the week. The BSE Small-Cap index rose 114.62 points or 1.35% at 8,620.26.
The wholesale price index rose 7.83% in 12 months to 3 May 2008, higher than previous week's annual rise of 7.61%, government data released on 16 May 2008, showed. It was the highest since an annual reading of 7.93% n 6 November 2004. The annual inflation rate was 5.74% during the corresponding week of the previous year.
India's industrial production growth dropped sharply to 3% in March 2008, slowing from the previous month's unrevised 8.6%, government data showed on Monday, 12 May 2008. It was the slowest annual growth since a 2.4% rise in February 2002.
Manufacturing production rose 2.9% in March 2008 from a year earlier, compared with 8.6% growth in February 2008. Industrial output rose 8.1% in 2007/08 compared with 11.6% in 2006/07.
US light crude for June delivery surged to a record high of $126.98 on Tuesday, 13 May 2008. However, that price eased to $123.74 on 15 May 2008 as rising US distillates stocks and Iran's reassurances that it would not cut crude exports added to a strengthening US dollar to limit the upside.
India's rupee fell to the lowest level since April 2007 to 42.445 per dollar on Wednesday, 14 May 2008 on speculation record crude oil prices will widen the nation's trade and current-account deficits, increasing demand for foreign currencies. The currency also weakened after overseas investors further sold local equities.
Foreign institutional investors (FII) have, so far, sold shares worth Rs 529.10 crore this month, till 14 May 2008. They sold shares worth Rs 10,887.20 crore in calendar year 2008, till 14 May 2008. Domestic funds sold shares worth Rs 639.80 this month, till 14 May 2008.
On 12 May 2008, frenzied buying in late trade helped market snap its five-day slide. The 30-share BSE Sensex rose 123.83 points or 0.74% to 16,860.90. The broader based S&P CNX Nifty was up 30.05 points or 0.60% at 5,012.65.
On 13 May 2008, Indian equities reversed early gains in choppy trade to settle lower closely mirroring European markets which opened after Indian market. The 30-share BSE Sensex slipped 108.04 points or 0.64% at 16,752.86. The broader based S&P CNX Nifty shed 54.85 points or 1.09% at 4,957.80.
On 14 May 2008, Relentless buying in software and metal stocks in late trade propelled market higher after a nervous start. The 30-share BSE Sensex surged 225.49 points or 1.36% at 16,978.35. The broader based S&P CNX Nifty gained 53.95 points or 1.09% at 5,011.75.
On 15 May 2008, the market settled near day’s highs helped by late buying frenzy in index pivotals. Shares from real estate, software and capital goods were at the forefront of the rally. The 30-share BSE Sensex surged 375.19 points or 2.21% at 17,353.54. The broader based S&P CNX Nifty gained 103.50 points or 2.07% at 5,115.25.
On 16 May 2008, rally in Asian and European markets, and firm US stock futures indicating higher opening of US stocks helped Indian market shrug off a surge in inflation to highest level in more than three years. Shares from banking and metal advanced on renewed buying. The 30-share BSE Sensex rose 81.40 points or 0.47% at 17,434.94. The broader based S&P CNX Nifty advanced 42.45 points or 0.83% at 5157.70.
India's biggest mobile operator by market share Bharti Airtel rose 1.09% to Rs 851.35. The firm is reportedly evaluating a bid for South Africa-based communication services provider MTN Group.
India's largest pharma company in terms of sales Ranbaxy Laboratories gained 8.79% to Rs 510.70. Ranbaxy Laboratories signed a deal to develop new anti-infective drugs for US-based Merck & Co Inc. As per the deal, Ranbaxy will carry out drug discovery and clinical development through Phase II clinical trials, while Merck will be responsible for the development and commercialisation.
India's largest private sector company in terms of market capitalisation and oil refiner Reliance Industries (RIL) rose 4.25% to Rs 2635.20. Recently, RIL had shut all of its 1,432 petrol pumps in the country after sales dropped to almost nil as it could not match the subsidised price offered by public sector competition.
Depreciation in Indian currency against the dollar generated interest in software counters as the Indian software firms earn more than half of their revenue in dollar terms. India's largest software services exporter TCS surged 6.40% to Rs 976.15, Infosys Technologies, the nation's second biggest software exporter by sales, spurted 6.89% to Rs 1871.19 and Wipro, the third largest exporter by sales, flared up 0.99% to Rs 506.15.
India's top tractor maker Mahindra & Mahindra (M&M) fell 1.52% to Rs 662. The company said on Friday, 9 May 2008, it is hiking vehicle prices in the range of 1.5% to 2.5% due to rise in input costs. The price hikes will come into effect from 19 May 2008.
India's largest private sector aluminium company in terms of sales Hindalco Industries jumped 17.37% to Rs 203.70.
India's biggest private sector lender by assets ICICI Bank galloped 7.68% to Rs 941.15
India’s largest cellular services provider in terms of market capitalisation Reliance Communications gained 11.65% to Rs 601.85. Reliance Infratel, a 95% telecom infrastructure subsidiary of the company is reported to have secured the Securities and Exchange Board of India (Sebi)’s nod for a public issue. The Anil Ambani group company may offload a 10.05% stake in Reliance Infratel to raise Rs 5,000-6,000 crore through the IPO.
Infrastructure sector output rose 9.6% in March 2008 from a year earlier, faster than a downwardly revised 7.1% growth in February 2008, data released by the government showed. Output had risen an annual 10.5% in March 2007. It rose 5.6% in the fiscal year 2007/08.
Tourist arrivals in India rose 10.7% to 3,69,677 in April 2008 over April 2007, the government data showed on Monday, 12 May 2008. Foreign exchange earnings from the sector rose 6.8% to $817 million in April 2008 over April 2007.
C. Rangarajan, chairman of Prime Minister’s Economic Advisory Council, on 12 May 2008, said the annual inflation rate is expected to moderate to 6% in the next three to four months from 3-½ year highs of 7.6% in late April 2008. Rangarajan said the economy is expected to grow 8% to 8.5% in the fiscal year ending March 2009 as high global oil prices shave off some momentum.
Third straight day of gains
Rally in Asian and European markets, and firm US stock futures indicating higher opening of US stocks today helped Indian market shrug off a surge in inflation to highest level in more than three years. Shares from banking and metal advanced on renewed buying.
The Dow Jones Industrial Average futures were up 25 points to 13017 while Nasdaq futures were up 4.25 points to 2040.
The 30-share BSE Sensex rose 81.40 points or 0.47% at 17,434.94. The barometer index opened with an upward gap of 122.87 points at 17,476.41. It struck a high of 17,497.36 in early trade. At the day’s high, Sensex gained 143.82 points. Sensex lost 38.02 points at day’s low of 17,315.52 touched in early afternoon trade.
The broader based S&P CNX Nifty advanced 42.45 points or 0.83% at 5,157.70. Nifty May 2008 futures were at 5148 a discount of 9.70 points as compared to spot closing
As per provisional data, foreign funds bought shares worth a net Rs 475.87 crore today, 16 May 2008. Domestic funds bought shares worth Rs 392.10 crore.
The BSE Sensex has gained 682.08 points or 4.07% in three trading sessions from 16752.86 on 13 May 2008, on firm global markets and due to depreciation of the rupee against the dollar which has lifted export driven IT shares.
The wholesale price index rose 7.83% in 12 months to 3 May 2008, higher than previous week's annual rise of 7.61%, government data released today, 16 May 2008, showed. It was the highest since an annual reading of 7.93% n 6 November 2004. Meanwhile, the government also revised inflation for the week ended 8 March 2008 sharply upwards to 7.78% as compared to 5.92% reported earlier.
The market breadth was strong on BSE with 1521 shares advancing as compared to 1160 that declined. 86 remained unchanged.
The BSE Mid-Cap index was up 0.70% to 7,129.70 while the BSE Small-Cap index gained 0.86% to 8,620.26. Both these indices outperformed the Sensex.
The total turnover on BSE amounted to Rs 6085 crore as compared to Rs 6,484.97 crore yesterday, 15 May 2008. Turnover in NSE’s futures & options segment amounted to Rs 37876.68 crore as compared to Rs 38196.16 crore yesterday, 15 May 2008
All sectoral indices on BSE logged gains barring the BSE IT index which shed 0.42% to 4,467.55.
The BSE Oil & Gas index (up 0.75% to 11,289.58), BSE Bankex (up 1.54% at 8,941.28), BSE Capital Goods index (up 0.71% at 13,696.75), BSE FMCG index (up 0.55% to 2,508.25), BSE Auto (up 0.57% at 4,757.30), BSE Health Care index (up 0.83% at 4,321.48), BSE Metal index (up 1.90% to 17,058.01), BSE Power (up 0.89% to 3,332.49), and BSE Consumer Durables index (up 0.75% to 4,582.72s), outperformed the Sensex.
The BSE Realty index (up 0.02% at 8,044.25), BSE TecK index (up 0.06% to 3,555.01), BSE PSU index (up 0.40% to 7,793.86), underperformed the Sensex.
Among the 30-member Sensex pack, 16 gained while the rest slipped
India’s largest bulk drug maker in terms of sales, Ranbaxy Laboratories advanced 3.04% to Rs 509.50 on 7.61 lakh shares. It was the top gainer from Sensex pack.
India’s largest private sector company in terms of market capitalisation and oil refiner Reliance Industries (RIL) was up 0.72% to Rs 2641.45 on 6.52 lakh shares. The stock moved in a range of Rs 2601 and Rs 2646 so far during the day.
Metal shares rose on fresh buying. Sterlite Industries (up 2.08% to Rs 891.10), Tata Steel (up 0.98% to Rs 890.50), and Sesa Goa (up 0.55% to Rs 4280) gained.
Steel Authority of India jumped 7.97% to Rs 187 on reporting 24.97% rise in net profit to Rs 2376.76 crore on 30.42% increase in total income to Rs 13855.25 crore in Q4 March 2008 over Q4 March 2007. The company announced the results during trading hours today, 16 May 2008.
India’s largest cellular services provider in terms of market capitalisation Reliance Communications gained 2.73% to Rs 605.10 after its 95% infrastructure subsidiary Reliance Infratel reportedly secured the Securities and Exchange Board of India (Sebi)’s nod for public issue. The Anil Ambani group company may offload a 10.05% stake in Reliance Infratel to raise Rs 5,000-6,000 crore through the IPO.
India’s largest cellular services provider in terms of market capitalisation Bharti Airtel shed 1.13% to Rs 846.50. The company’s plan for taking over South African telecom major MTN has reportedly entered into a crucial negotiation phase. While Bharti Airtel is ready to acquire 51% stake, MTN’s management wants it to buyout the entire company.
Banking shares shrugged off data showing a surge in inflation. HDFC Bank (up 1.61% to Rs 1500), and State Bank of India (up 1.31% to Rs 1701) advanced
ICICI Bank, the country's largest private sector bank in terms of net profit was up 1.22% to Rs 940. As per reports, the bank’s the private equity arm ICICI Venture Fund Management, will raise as much as $3 billion for an infrastructure and a real estate fund.
IT pivotals slipped after firm start on profit taking. Infosys (down 1.28% to Rs 1867.10, off day’s high of Rs 1918.40), Wipro (down 0.66% to Rs 505.50, off day’s high of Rs 515), and TCS (down 1.05% to Rs 975.10, off day’s high of Rs 1000.15), declined.
However India’s fourth largest software services exporter Satyam Computer Services rose 0.64% to Rs 487.
The Indian rupee fell to a 13-month low against the dollar today, 16 May 2008. A depreciating rupee augurs well for IT companies as they derive over 50% of their revenues from exports to US.
India’s largest private sector engineering company in terms of outstanding order book position Larsen & Toubro slipped from day’s high of Rs 3033. It closed with gain of 0.56% to Rs 2997. The company said it had entered into a partnership agreement with GE Energy, a unit of General Electric, for power plant control systems in India.
Hindustan Unilever (up 1.47% to Rs 242.10) and Jaiprakash Associates (up 1.67% to Rs 270.05), edged higher from Sensex pack.
India’s largest dedicated housing finance company in terms of total income Housing Development Finance Corporation fell 1.55% to Rs 2750 on 63,625 shares. It was the top loser from Sensex pack.
NTPC, the country’s largest power generation company in terms of sales, slipped 0.16% to Rs 191.35 on reports the Finance Ministry has turned down its proposal for selling 4.75% stake through follow-on public offer. The Government holds 89.5% in the utility (as at end March 2008).
Ambuja Cements (down 1.07% to Rs 110.90), and Cipla (down 1.12% to Rs 211.30) edged lower from Sensex pack.
Aishwarya Telecom was the top traded counter on BSE with turnover of Rs 357.30 crore followed by Housing Development Infrastructure (Rs 177.66 crore), Steel Authority of India (Rs 171.22 crore), Reliance Industries (Rs 171.20 crore), and Reliance Communications (Rs 169.78 crore), in that order.
Bank of India vaulted 5.66% to Rs 358.20 on reporting 76.87% rise in net profit to Rs 1959.84 crore on 38.26% rise in total income to Rs 14528.41 crore, on a consolidated basis, in the year ended March 2008 over year ended March 2007
Zylog Systems declined 4.62% to Rs 282.85 on reporting 21.67% fall in net profit to Rs 18.36 crore on 1.37% rise in net sales to Rs 162.08 crore in Q4 March 2008 over Q3 December 2007. The company announced the results after trading hours on Thursday, 15 May 2008.
Voltas dropped 2.71% to Rs 163.20 on reporting 53.8% fall in net profit to Rs 55.41 crore on 16.7% rise in net sales to Rs 842.11 crore in Q4 March 2008 over Q4 March 2007.
Chennai Petroleum Corporation rose 0.26% to Rs 351 on reporting 81.9% surge in net profit to Rs 343.92 crore on 48% increase in net sales to Rs 8367.89 crore in Q4 March 2008 over Q4 March 2007. The company announced the results after trading hours on Thursday, 15 May 2008.
Edelweiss Capital declined 2.08% to Rs 793 despite reporting 88.51% rise in net profit to Rs 10.01 crore on 252.64% rise in total income to Rs 71.2 crore in Q4 March 2008 over Q4 March 2007.
Tata Investment Corporation surged 5.35% to Rs 577.50 after the company said its board will raise Rs 448 crore through rights issue of zero-coupon convertible bonds in the ratio of 1:5.
Tech Mahindra gained 2% to Rs 952 on reports the company has bagged a $700-million contract from BT Group to improve its IT infrastructure.
Kinetic Motor Company jumped 5% to Rs 30.75 on reports Sanyang Industry Company, a Taiwan-based two-wheeler maker, has expressed keen interest in acquiring controlling stake in the Pune-based company.
Bongaigaon Refinery & Petrochemicals galloped 9.54% to Rs 62 after the company today, 16 May 2008, announced a divided of Rs 5 per share for the year ended March 2008
In a development that can boost the stock market, the government is reportedly set to review the restrictions imposed on participatory notes (P-notes), as foreign institutional investor (FII) have pressed substantial sales from Indian markets in calendar year 2008. In October 2007, FIIs were barred from issuing P-notes in the derivatives market. The finance ministry has asked the Securities & Exchange Board of India (Sebi) to examine whether those restrictions have hindered investments by FIIs.
Meanwhile, polling began for the second phase from today, 16 May 2008, in 66 Assembly constituencies in ten districts of Karnataka. Third and final phase of election will be held on 22 May 2008 in 69 constituencies spread across eight districts. Counting of votes for all the 224 segments will be held on 25 May 2008.
European markets which opened after Indian markets, extended early gains. Key benchmark indices in United Kingdom (up 1.47% to 6,342.80), Germany (up 1.32% to 7,174.62), and France (up 0.87% to 5,101.36), edged higher.
Asian markets settled mixed today, 16 May 2008. Hang Seng (up 0.41% at 25,618.86), Straits Times (up 0.91% at 3,236.56), Seoul Composite (up 0.14% at 1,888.43) and Taiwan Weighted (up 0.44% at 9,197.41) edged higher.
However China’s Shanghai Composite (down 0.36% at 3,624.33) and Nikkei 225 Average (down 0.23% at 14,219.48), declined.
US markets rallied yesterday, 15 May 2008, after a better-than-expected economic data and pullback in oil prices eased some of the market`s concerns about inflation. The Dow Jones industrial average rose 94.28 points, or 0.73%, to 12,992.66. The Nasdaq Composite index rose 37.03 points, or 1.48%, to 2,533.73 while the S&P 500 index gained 15 points at 1,424.
Back home, the 30-share BSE Sensex surged 375.19 points or 2.21% at 17,353.54 and the broader based S&P CNX Nifty gained 103.50 points or 2.07% at 5,115.25, yesterday 16 May 2008.
US crude for June delivery rose 67 cents to $124.79 a barrel today, led by the bullish heating oil market as China and Europe scramble for barrels, thinning global supply.
The Indian stock market remains closed on Monday, 19 May 2008, on account of Buddha Pournima.
Grey Market Premiums - Gokul Refoils, Anu's Laboratories
Gokul Refoils 175 to 195 25 to 27
Anus Laboratories 200 to 210 23 to 26
Pre Market Watch - May 16 2008
Strong favoring global cues will led the Indian Market to have positive opening today. The Indian market on Thursday closed with good gains on the back of heavy buying throughout the session. It opened with a huge gap up due to the strong positive cues from the global market and the easing of the crude oil prices, which led the investors’ to show positive attitude in early session. The market gained the further momentum after the mid session to close on a satisfactory note. The capital goods and metal stocks remained in the limelight as it witnessed most buying during the trading session. The BSE Sensex closed higher by 375.19 points at 17,353.54 and NSE Nifty went up by 103.50 points to close at 5,115.25. We expect that the market may extend its yesterday’s gains during the trading session and the declaration of the inflation figure by the government in the later half will give further direction to the market.
The cost of trading in Indian equities could rise marginally as brokerages will levy 12.36% service tax on transaction charge, auction commission and bad delivery auction commission from today. It will be charged on all market segments, but it would not effect the trading too much as the rise will be marginal.
On Thursday, the US market closed in green. The Dow Jones Industrial Average (DJIA) closed higher by 94.28 points at 12,992.66 along with NASDAQ went up by 37.03 points to close at 2,533.73 and S&P 500 also went up by 14.91 points to close at 1,423.51.
Indian ADRs closed firmly. In technology sector, Infosys went up by (5.08%) along with Patni Computers by (2.61%), Wipro by (1.64%) and Satyam by (1.58%). In banking sector, ICICI bank grew by (3.33%) and HDFC bank by (3.54%). In telecommunication sector, MTNL and Tata Communication ended higher by (1.33%) and (1.09%). Sterlite Industries advanced by (2.15%).
Today the major stock markets in Asia are trading higher. Hang Seng index is trading up by 229.26 points at 25,742.97 along with Taiwan Weighted trading at 9,222.43 up by 65.25 points and Japan’s Nikkei trading higher by 21.97 points at 14,273.71.
The FIIs on Thursday stood as net buyer in equity and net seller in debt. The gross equity purchased was Rs2,619.70 Crore and the gross debt purchased was Rs0.00 Crore while the gross equity sold stood at Rs2,361.50 Crore and gross debt sold stood at Rs13.60 Crore. Therefore, the net investment of equity reported was Rs258.10 Crore and net debt was Rs (13.60 Crore).
Today, Nifty has support at 5,043 and resistance at 5,229 and BSE Sensex has support at 17,034 and resistance at 17,792.
FIIs continue buying
Inflow of Rs 258.20 crore on 14 May 2008
Foreign institutional investors (FIIs) bought shares worth net Rs 258.20 crore on Wednesday, 14 May 2008, compared to their buying of Rs 186.30 crore on Tuesday, 13 May 2008.
FII inflow of Rs 258.20 crore on 14 May 2008 was a result of gross purchases Rs 2619.70 crore and gross sales Rs 2361.50 crore. Sensex surged 225.49 points or 1.36% at 16,978.35 on that day.
FII outflow in May 2008 totaled Rs 529.10 crore (till 14 May 2008). FII outflow in calendar year 2008 totaled Rs 10,887.20 crore (till 14 May 2008).
There are a total of 1,353 FIIs registered with the Securities & Exchange Board of India (Sebi).
Crude ends little lower
Crude prices give up early gains following natural gas inventory report
Crude prices closed more than $2 /barrel earlier today, Thursday, 15 May, 2008 but ultimately ended a little lower for the day. The dollar fluctuating against its rivals and the energy department’s report regarding the natural gas inventories was the main reason for the drop in crude prices. Crude-oil futures closed slightly lower pressured by weakness in natural-gas prices and options expiration-related volatility. Prices for crude oil have been hovering around $125 for quite some time now against a backdrop of disruptions to oil production in Nigeria.
Crude-oil futures for light sweet crude for June delivery today closed at $124.12/barrel (lower by $0.1/barrel or 0.1%) on the New York Mercantile Exchange. Price touched a low of $120.9 earlier during the day.
Last week, crude prices ended higher by 8.8%. For the year, crude is up by 25.8% till date.
Contributing to oil's decline, natural gas prices fell sharply. The natural gas sector was among the biggest losers in the energy sector after a U.S. report showed a bigger-than-expected rise in supplies for last week.
The Energy Department reported today that natural-gas inventories rose by 93 billion cubic feet for the week ended 9 May against an expected figure of 85 billion. Total stocks now stand at 1.529 trillion cubic feet, down 286 billion cubic feet from the year-ago level but 3 billion cubic feet above the five-year average.
Prices for June natural gas fell by 20 cents, or 1.7%, to finish at $11.40 per million British thermal units.
At the MCX, crude oil for May delivery closed at Rs 5,187/barrel, lower by Rs 86 (1.6%) against previous day’s close. Natural gas for July delivery closed at Rs 481.9/mmbtu, lower by Rs 11.2/mmbtu (2.3%).
Daily Trading Calls - May 16 2008
Nifty (5115)Sup 5056 Re 5180
Buy Patni (283)
SL 278 Target 292, 295
Buy HDFC (2802)
SL 2780 Target 2845, 2855
Buy Suzlon (293)
SL 288 Target 302, 305
Sell Welspun Gujarat (385)
SL 390 Target 375, 372
Sell Tata Motors (660)
SL 666 Target 648, 644
Bulls batting...enjoy the match
We're so busy watching out for what's just ahead of us that we don't take time to enjoy where we are,.
More exciting than the market would be today's 20-20 cricket match between Mukesh Ambani’s Mumbai Indians and Shah Rukh Khan’s Kolkata Knight Riders. The bulls seem to have been inspired by Sanath Jayasuriya’s blazing knock the other evening and stocks like RIL did manage to send many a bears to the fence.
But then it is that day of the week again, when Inflation jitters seem to make the bulls nervous. Hopefully, most of the bad news on this front has already been factored in by the market with expectations that inflation may even hit 8%. So it can’t get worse than it. Though oil prices remain at highly elevated level, the Government is not even talking about a price hike due to political compulsions. On the contrary, the Finance Minister has reportedly refused to increase the quantum of oil bonds to oil PSUs. The Centre has also forced steel and cement companies to cut prices to rein in inflation.
These three sectors are likely to bear the brunt of the Government's inflation-fighting efforts. Aviation is another sector where Government apathy has dragged the sector into deep losses. Most sectors are facing increasing number of challenges amid high interest rates, soaring inflation, currency fluctuations, slowing economic growth and uncertain market conditions. This may reflect in their performance over the next few quarters.
Coming to the market, the outlook for the day appears to be brighter after Thursday’s strong finish and firm global cues. Inflation figures may not hurt that much, and the bulls might just decide to extend their gains into a third straight day. However, one should look to reduce one's holdings at every rally as the key indices will face some resistance at higher levels. The near-term outlook continues to be one of cautious optimism.
FIIs were net buyers of Rs7.07bn (provisional) in the cash segment yesterday while local institutions poured in Rs3.63n. In the F&O segment, foreign funds were net buyers of Rs5.22bn. On Wednesday, FIIs were net buyers of Rs2.58bn while Mutual Funds too were net buyers of Rs1.33bn.
Key Results Today: Bank of India, Bongaigaon Refinery, Edelweiss Capital, Emkay Share, HT Media, NMDC, Redington, Saksoft, Shriram EPC, SAIL, Stone India and Texmaco.
Asian stocks rose for a fifth day, led by commodity producers and shipping companies, on renewed speculation that China is seeking a stake in BHP Billiton and after the price of transporting freight jumped to a record.
BHP shares climbed to a high in Sydney after the Australian newspaper reported that Chinese interests want to team up with an Australian fund to purchase a 9% stake in the mining giant. Mitsui OSK Lines, Japan's largest shipping company, rose to a six-month high.
Mizuho Financial Group rallied in Tokyo after forecasting profit will almost double this year.
The MSCI Asia Pacific Index gained 0.8% to 153.32 as of 10:55 a.m. in Tokyo, set to complete its longest winning streak since October 3. The index is headed for a 3% advance this week. About four stocks rose for every three that declined.
All Asian benchmark indexes advanced. Japan's Nikkei 225 Stock Average added 0.2% to 14,276.08. The country's economy grew faster than economists estimated last quarter as exports to Asia and emerging markets helped the nation weather the US slowdown.
US stocks rose on Thursday, with technology leading the way. The S &P 500 Index touched a four-month high, as analysts said chipmakers will benefit from rising global demand and energy shares are cheap relative to crude prices.
Intel and Nvidia led semiconductor shares to their highest level of the year on a Friedman Billings Ramsey & Co. report that orders are improving. Exxon Mobil helped push the S&P 500 Energy Index to a record after UBS said the oil industry is notably inexpensive.
Tiffany advanced to the highest level since November after the second-largest luxury-jewelry retailer boosted its dividend by 13 percent.
The S&P 500 added 14.91, or 1.1%, to 1,423.57. The Dow Jones Industrial Average increased 94.28, or 0.7%, to 12,992.66. The Nasdaq Composite Index gained 37.03, or 1.5%, to 2,533.73.
Market breadth was positive and volume was moderate. More than five stocks rose for every two that fell on the New York Stock Exchange.
US indices struggled to rise in the morning amid rising oil prices, mixed economic reports and a string of M&A news. But the tone turned positive in the late morning, despite volatile oil prices.
US stocks have been rising over the past two months as investors bet that the worst of the credit market crisis is behind them and the world's biggest economy appears to be stabilizing.
US light crude oil for June delivery fell 10 cents to settle at $124.12 a barrel in New York following a volatile session.
Meanwhile, the national average price for a gallon of regular unleaded gas rose to a record $3.776 from $3.758 the previous day, according to AAA. It was the eighth record in a row.
COMEX gold for August delivery rose $13.30 to settle at $884.10 an ounce. The dollar rose versus the euro and slipped versus the yen. Treasury prices rose, lowering the yield to 3.83% from 3.90% late on Wednesday.
Yahoo shares climbed 2.3%. Activist shareholder Carl Icahn launched a campaign to overthrow Yahoo's board as part of an effort to restart deal talk with Microsoft.
Media giant CBS said it would buy CNet Networks for a 45% premium in a move to expand its reach further onto the Web. Also on the online front, Comcast said it is buying social networking site, Plaxo, and IAC/Interactive will acquire Lexico Publishing Group.
GE has reportedly hired Goldman Sachs to seek buyers for the sale of its appliances business, which could be worth between $5- $8bn. GE shares inched lower.
JC Penney reported weaker quarterly results that beat forecasts. The retailer also said second-quarter earnings would come in just ahead of analysts' forecasts, but that full-year conditions will be difficult amid the tougher consumer spending environment. Shares gained more than 4%.
Thursday's economic news was mixed. Jobless claims rose a bit, New York-area manufacturing worsened and Philadelphia-area manufacturing weakened less than had been expected. Industrial production and capacity utilization declined more than expected in April and homebuilder confidence fell again in May.
Friday brings economic reports on housing starts, building permits and consumer sentiment.
Stocks in Europe closed higher thanks to a late-afternoon rally. The pan-European Dow Jones Stoxx 600 index, down about 10% this year, finished 0.4% higher at 328.41, with advancing stocks outpacing those declining roughly 3 to 2.
The UK's FTSE 100 ended up 0.6% at 6,251.80. The German DAX 30 finished nearly unchanged at 7,081.05 and the French CAC-40 finished virtually unmoved at 5,057.51.
Most emerging markets closed higher. The Bovespa in Brazil was up 2% at 71,492 while the IPC index in Mexico climbed 0.7% at 31,542. The RTS index in Russia gained 0.25% to 2411 while the ISE National 30 index in Turkey rose 0.4% to 52,599.
Can bulls maintain tempo
Bulls had a stellar session as bears were shrugged of the bourses amid firm global cues and all round buying in the scrips across the sectors. Bulls completely dominated the whole session. A sudden bout of buying in the index heavyweights like Reliance Industries, Infosys, L&T and RCom lifted the Nifty index to close above the 5,100 mark and the benchmark Sensex closed above the 17,300 mark.
The Capital Good, Realty, Oil & Gas, Banking and Power stocks were in demand. However, the FMCG stocks were slightly under pressure. Finally, the BSE benchmark Sensex ended 375 points higher to close at 17,353 and the Nifty index gained 103 points to close at 5,115.
Overall about 1,771 stocks advanced; 909 stocks declined while 74 stocks remained unchanged. Among the 50-Nifty 39 stocks ended in green and 11 stocks ended in red.
PNB surged by over 5.5% to Rs537 after the company announced its results for the quarter and year ended March 31, 2008. The Bank posted a net profit of Rs5437.6mn for the quarter ended March 31, 2008 as compared to Rs2377mn for the quarter ended March 31, 2007. Total Income increased from Rs37127.9mn for the quarter ended March 31, 2007 to Rs44170mn for the quarter ended March 31, 2008.
The Bank posted a net profit of Rs20487.6mn for the year ended March 31, 2008 as compared to Rs15400.8mn for the year ended March 31, 2007. Total Income increased from Rs129665.4mn for the year ended March 31, 2007 to Rs162625.8mn for the year ended March 31, 2008. The scrip touched an intra-day high of Rs540 and a low of Rs503 and recorded volumes of over 6,00,000 shares on NSE.
Torrent Power gained by 2% to Rs132 after the company announced its results for the quarter and year ended March 31, 2008. The company posted a net profit of Rs504.6mn for the quarter ended March 31, 2008 as compared to Rs443.2mn for the quarter ended March 31, 2007. Total Income increased from Rs7762mn for the quarter ended March 31, 2007 to Rs9483.8mn for the quarter ended March 31, 2008.
The company posted a net profit of Rs2112.4mn for the year ended March 31, 2008. Total Income is Rs37220mn for the year ended on March 31, 2008. The scrip touched an intra-day high of Rs136 and a low of Rs132 and recorded volumes of over 4,00,000 shares on NSE.
MLL rose over 14% to Rs114 after country’s fourth biggest shipping company by market value quadrupled earnings for the quarter ended March 31 to Rs740.4mn. The scrip touched an intra-day high of Rs117 and a low of Rs102 and recorded volumes of over 81,00,000 shares on NSE.
Reliance Industries gained momentum towards the fag end of the trading session. The scrip performed like the ‘Mumbai Indians’ the IPL team which won in handsome style against the ‘Chennai Super Kings’ on Wednesday. The scrip ended higher by over 3.5% to Rs2622 and touched an intra-day high of Rs2633 and a low of Rs2535 and recorded volumes of over 6,00,000 shares on NSE.
Madras Aluminium surged by over 9% to Rs894 after the company said that they would consider stock split on May 16, 2008. The scrip touched an intra-day high of Rs897 and a low of Rs790 and recorded volumes of over 71,000 shares on NSE.
Syndicate Bank gained by over 3% to Rs77. According to reports, the company repriced its bulk deposits. The company also on Wednesday announced its Q4 results with PAT rising over 21% to Rs1263mn. However, the company’s revenues for the fourth quarter fell by 6.8% to Rs5,626mn. The scrip touched an intra-day high of Rs77 and a low of Rs75 and recorded volumes of over 2,00,000 shares on NSE.
Neyveli Lignite gained by over 4.5% to Rs142 after the company announced that they would develop 1000MW coal based power plant and would spend Rs49.1bn to develop the power project. The scrip touched an intra-day high of Rs142 and a low of Rs137 and recorded volumes of over 90,00,000 shares on NSE.
Flawless Diamond gained by 3% to Rs68 after the company said that they secured Rs670mn order from Hong Kong’s M/s Jewelmax Company and Fine Jewellery. The scrip touched an intra-day high of Rs71 and a low of Rs66 and recorded volumes of over 1,00,000 shares on NSE.
Corporate News
Bihar Tubes' Board will meet today to consider various fund raising options for the proposed expansion plans and modernization of existing manufacturing facilities of the company.
BASF SE has announced an open offer for buying up to 6,289,591 shares or 22.31% of the voting capital of BASF India at a price of Rs 274 per share. The offer will start on July 9 and will close on July 28. The stock was up 1.2% yesterday.
Welspun India has denies media news that it was planning to acquire Linen N Things of USA. "The news reported by various TV channels and newspapers is not true and is based on speculation," the company said in a statement.
Realty firm Omaxe proposes to take up low-cost urban housing through its subsidiary National Affordable Housing and Infrastructure and other group companies. The company has already started identifying and acquiring various tracts of land for this purpose and will be finalizing the design, costs, etc., in due course.
OnMobile Global has signed an agreement to acquire 100% of Telisma SA, a leading provider of speech recognition software for Service Providers and Enterprises. Telisma is based out of Paris, France.
Jain Irrigation and the Government of Maharashtra have signed a MoU for investment of Rs5.5bn in the state through two projects.
Reliance Industries is in talks with three overseas oil companies to bid for oil and gas blocks in the seventh round of NELP. (ET)
Tech Mahindra has bagged US$700mn contract from BT. (ET)
Reliance Infratel and MCX public offers get SEBI nod. (BS)
Bharti Airtel crosses 4mn subscribers in Delhi. (ET)
Reliance Communications gets Rs30bn loan from China Development Bank to fund its nationwide GSM foray. (ET)
L&T to utilize Lafarge money for expanding shipping, power and infrastructure projects. (BS)
Government files a petition before TDSAT seeking to recover Rs20.2bn from Tata Teleservices. (ET)
Infosys is race for acquiring Aptara, a third-party BPO in technology publishing. (ET)
Wipro is planning to enter in renewable energy business. (ET)
Essar Steel to join the race for CSN’s iron ore mines. (BS)
Nalco shortlists 2-3 coal mines in Indonesia. (BS)
Neyveli Lignite gets government approval for development of 1,000MW coal based thermal power project in Tamil Nadu. (BS)
Jain Irrigation to set-up two projects in Jalgaon, Maharashtra, at an investment of Rs5.5bn. (BS)
BASF to make an open offer to BASF India’s shareholders for acquiring over 22% stake for Rs1.72bn. (BS)
PGCIL is looking for opportunities for expanding overseas especially in Africa and Middle East. (DNA)
Zydus Cadila gets nod from US FDA to market four products. (ET)
Sterling Group expects to launch DTH services by 2009. (BL)
Phoenix Mills to build 25 hotels in five years. (DNA)
Lupin is looking for acquisitions in US and emerging markets to expand its overseas operations. (DNA)
Sanyang, a Taiwan based two-wheeler maker, joins the race for acquiring controlling stake in Kinetic Motors. (BS)
SAIL to set-up a processing unit in Himachal Pradesh. (FE)
Voltas plans to acquire overseas companies to expand electro-mechanical projects business. (BS)
Rane Group earmarks Rs2bn for expanding product facilities across the country. (BL)
Wanbury plans to acquire CRAMS companies in US and Europe. (BS)
Economic News
The six core infrastructure sectors record a growth of 9.6% in March 2008. (ET)
The Supreme Court asks UP sugar mills to pay Rs110/quintal to sugarcane farmers for the 2007-08 season within three weeks. (ET)
The annual policy review on ECBs is likely to ease end-user restrictions and quantum of borrowings. (ET)
Finance Minister rules out any cut in import duty on crude oil and rollback of export duty on steel. (ET)
Government is set to review the restrictions imposed on participatory notes. (FE)
The Finance Ministry rejects NTPC’s follow-on public issue. (ET)
Liquor companies to increase prices on high input cost. (BS)
Government expects a further cut in cement prices. (BS)
Petroleum Ministry may go to Cabinet for tax breaks for natural gas production. (FE)
Company Background - ICICI Bank
ICICI Bank, a private sector bank under the house of ICICI was incorporated in the year of 1994. It is a multi-specialist financial service provider with leadership position across the spectrum of financial services in India. ICICI Bank is the 2nd largest bank in India and Bank breaking into the top 100 financial institutions in the world, in terms of market capitalisation. It got this position in short time, because the bank doing what customers want. ICICI running its business with six principal groups, such as Retail Banking, Wholesale Banking, International Banking, Rural, Micro Banking and Agri-Business, Government Banking and Corporate Centre. The Bank offers a wide spectrum of domestic and international banking services to facilitate trade, investment banking ,Insurance, Venture Capital, asset management, cross border business & treasury and foreign exchange services besides providing a full range of deposit and ancillary services for both individuals and corporates through various delivery Channels and specialized subsidiaries. ICICI Bank has 14 subsidiaries, out of that 10 in domestic and rest of 4 in international level such as UK, Canada and Russia. To efficiently distribute its products and services, the bank has developed multiple access channels comprising lean brick and mortar branches, ATMs, call centers and Internet banking. The Bank has introduced the concept of mobile ATMs in the remote/rural areas. It has also extended its mobile banking services to all cellular service providers across India and NRI customers in USA,UK,Middle-East and Singapore.
The merger and acquisition are the key kind to bank. The Bank of Madura (BOM) got merged with ICICI Bank during the period 2000-01 and in 2001 ICICI (Financial Institution) merged with ICICI Bank. The two subsidiaries of ICICI Ltd viz ICICI Personal Financial Services and ICICI Capital Services were also merged with the ICICI Bank on March 2002. During May,2003 the bank has acquired Transamerica Appple Distribution Finance Private Ltd and renamed it to ICICI Distribution Finance Private Limited which is primarily engaged in financing in the two-wheeler segment.
Bank received many awards and recognitions during the year 2005-06. Some of them are Best Bank in India by Euromoney, Best Integrated Consumer Bank Site in Asia by Global Finance, Best Cash Management-Country Awards in India by The Asset and Best Secondary Offering by Finance Asia. ICICI Bank noted as Bank of the year 2006 India by The Banker, it was a award to ICICI Bank at second time from last year. During the year 2006-07 also Bank acquired the number of awards. Samples are, Best Transaction Bank in India by Asset Triple AAA, Best Bank of the Year 2006 by Business India, National Award for Excellence in Energy Management by CII and Excellence in Multi Channel Distribution by Asian Banker.
As on April 2007 Sangli Bank Ltd was merged with ICICI Bank Ltd. In the Wholesale Banking segment, the bank has achieved a significant milestone in the market making activity by expanding the product suite to include foreign exchange options. As on May 2007 the bank have market capitalisation of Rs 77,834 crore. In 2007 June ICICI Bank has entered into an agreement with networking solutions provider GTL Ltd to lease out its call centre facility at Mahape worth of around Rs 100 crore for a period of 25 years. In August of 2007 the bank has availed of a $200-million worth Line of Credit (LoC) from The Export-Import Bank of Korea (Korea Exim bank) for the purpose of the Hong Kong branch of ICICI Bank gets funds from Korea Exim bank, and the bank lends foreign currency loans to domestic companies investing in Korea and the bank had taken a similar LoC of $200 million from the Japan Bank for International Cooperation (JBIC) last year. In 2008 ICICI Bank, come a cropper in the global stage when it comes to their brand value, which is $2,603 million, it reveals by the study of London-based consultancy Brand Finance
Company Background - SBI
SBI, started as Imperial Bank then named State Bank of India commenced its operations from the year 1955, is the largest commercial bank in India in terms of profits, assets, deposits, branches and employees. As of March 2008, the bank has had 21 subsidiaries and 10,000 branches. SBI offering the services of banking and as well as non- banking services to their customers. It provides a whole range of financial services which includes Life Insurance, Merchant Banking, Mutual Funds, Credit Cards, Factoring, Security Trading & Primary dealership in the Money market. The Bank is actively involved in non-profit activity called community services banking apart from its normal banking activity.
The bank also concentrate in agriculture, for that it took initiative spotlight kharif and spotlight rabi campaigns for higher disbursement. It introduced Automated Teller Machine with Kishan Credit Cards in all circles to assist agriculture peoples, cumulatively the bank has credit linked 7.68 lac Self Help Groups and disbursed loans to the extent of Rs 3,468 crs, so far. In the year 2001 the SBI Life was started. SBI is the only Bank to have been permitted a 74% stake in the insurance business. The Bank's insurance subsidiary "SBI Life Insurance Company" is a joint venture with Cardif S.A holds 26% stake. SBI Life enjoys the unique distinction of being the first private sector life insurance company in India to make profits for two consecutive years.
During the year 2004-05 SBI was the only one bank in India to ranked among top 100 banks in the world and also among the top 20 banks in Asia in the annual survey by "The Banker" as well as in the same year bank received two prestigious awards for technology from the same The Banker magazine. In the year 2005-06 the bank introduced "SBI e-tax" an online tax payments facility for direct and indirect tax payment, the centralized pension processing center also launched during the year. SBI made a partnership with Tata Consultancy Services for setup C-Edg Technologies and consulting services to the banking, financial services and insurance industry. The bank noted as The most preferred bank in a survey by TV 18 in association with AC Nielsen-ORG Marg along with SBI voted as The most preferred housing loan provider in AWAAZ consumer awards for 2006. In the customer loyalty survey 2006-07 conducted by "Business World", SBI has been ranked number One in all parameters of customer satisfication, service orientation, customer care/ call center, customer loyalty and home loans. SBI Funds (SBIFMPL) was judged "Mutual fund of the year" by CNBC/TV-18/CRISL. SBI FMBL Equity schemes won 11 awards and ranging of the AMC in terms of Assets under management remained at 7th position during the year 2006-07. SBI cards is in 2nd position in the country under market share. During the year 2006-07 14.81 lac additional cards were issued by SBI and they crossed the landmark of 3 million cards totally.
The strategic initiatives that SBI have launched business groups in 2007 namely rural and agri business; treasury and marketing; corporate strategy and new business; and fourth mid corporate group is on the anvil. They also introduced new products and services such as web-based remittance, instant fund transfer, online-trading, comprehensive cash management.
SBI opened its 10,000th branch in March 2008, it becomes only the second bank in the world to have more than 10,000 branches after China's ICBC. SBI is pursuing aggressive IT policy, where the Automated Teller Machines are now also enabled to pay utility bills, college fees, book air-line tickets and accept donations, further bilateral sharing of ATMs was extended to thirteen banks covering 15,700 Automated Teller Machines and an Memorandum of Understanding has been signed with the Indian railways for installing ATMs at 682 railway stations. Infrastructure fund, private equity, venture capital and pension fund management are under in process to assist the customer in time. SBI is targeting to emerge as the best rated bank among public, private, foreign and state -owned banks by the end of the next fiscal. Employee Stock Option Scheme, where employees have the option to pick up shares as per their needs is avail in SBI. SBI plans to implement the mobile banking technology will soon with aim of customer will no be just "Branch customers" but will be "Bank customers".
Today's Pick - Maruti Suzuki
We recommend a buy in Maruti Suzuki India from a short-term perspective. From the charts of the stock it is clearly evident that it was on a long-term downtrend from its October 2007 high of Rs 1,252, forming lower peaks and lower troughs till late April 2008.
Triggered by the positive divergence in the daily momentum indicator, the stock began to move up taking support at around Rs 720 during late April. Since then the stock’s up move has been continuing. On May 15, the stock penetrated the long-term down trendline as well as the 50-day moving average by surging 3 per cent.
With this, we believe that the long-term downtrend of the stock has come to an end. We notice that there is an increase in volume traded over the past two trading sessions. The daily momentum indicator has entered the bullish zone. Also, the daily moving average convergence and divergence is on the brink of entering the positive territory.
Our short-term forecast for the stock is bullish. We expect it to rally to our target price level of Rs 910 in the upcoming trading sessions. Investor with short-term perspective can buy the stock while keeping the stop-loss at Rs 782.
via BL
Nifty May 2008 futures at discount
Turnover in F&O segment surges
Nifty May 2008 futures were at 5113, at a discount of 2.25 points as compared to spot closing of 5115.25.
The NSE's futures & options (F&O) segment turnover was Rs 38,196.16 crore, which was higher than Rs 32,919.78 crore on Wednesday, 14 May 2008.
Reliance Industries May 2008 futures were near spot price at 2622 compared to the spot closing of 2622.95.
Reliance Communications May 2008 futures were near spot price at 590 compared to the spot closing of 589.75.
Reliance Capital May 2008 futures were at premium at 1371 compared to the spot closing of 1362.75.
In the cash market, the S&P CNX Nifty gained 103.50 points or 2.07% at 5115.25.
Inflation pinches corporates more
Corporate India could be a much bigger victim to rising prices than the common man with cost of doing business soaring up to 35 percent or about five times the wholesale price index levels.
It is the inflation faced by businesses in setting up and expanding manufacturing capacities, distribution and franchises, or simply investing in India and the concept becomes meaningful given the country is primarily investment led, according to new report by Citigroup global markets.
Citigroup has chosen to term this concept as "business inflation" which loosely represents the rising cost of setting up a business in India. This measure is primarily conceptual and directional and not something that seeks to be particularly robust or consistent in construct or level.
This is another kind of inflation which is not adequately captured in data or headlines, but has a more meaningful impact on corporate profitability, their investing frame-work
and over the time in equity markets, the research wing of global financial giant believes.
"Rising costs of setting up business, including asset, capital and services-based over the last three years suggests business inflation could be as high as 10-35 percent per annum, well ahead of 7-8 percent headline inflation," the report noted.
The increase in costs to establish new businesses has risen significantly ahead of the headline inflation and it has been sustaining at a high level for past three years, while
the surge in headline inflation is being noticed from just about a couple of months rather than for a sustained period, analysts believe.
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