Bush lifts ban on oil drilling

resident Bush lifted an executive ban on offshore oil drilling and challenged Congress to follow suit, aiming to turn the enormous public frustration about gasoline prices into political leverage. Democratic lawmakers rejected Bush's plan as a symbolic stunt.

With gas prices topping USD 4.10 a gallon nationally, Bush made his most assertive move to extend oil exploration, an energy priority of his presidency. By lifting the executive prohibition against coastal drilling, Bush rescinded a White House policy that his own father put in place in 1990.

The move will have no practical effect unless Congress acts, too. Both executive and legislative bans must be lifted before offshore exploration can happen.

Bush had called on Congress a month ago to go first, then reversed himself on Monday. He said the country could no longer afford to wait.

"Failure to act is unacceptable. It's unacceptable to me and it's unacceptable to the American people," Bush said in an event held in the Rose Garden.

"Democratic leaders can show that they have finally heard the frustrations of the American people by matching the action I've taken today, repealing the congressional ban, and passing legislation to facilitate responsible offshore exploration," Bush said.

BSE Bulk Deals to Watch - July 15 2008

Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
15/7/2008 531190 A V COTTEX I PEGASUS STOCKS AND SHARES PVT. LTD. B 160000 15.25
15/7/2008 531190 A V COTTEX I SUDISH KUMAR S 86600 15.25
15/7/2008 531190 A V COTTEX I SUDHIR JAIN S 51101 16.06
15/7/2008 531190 A V COTTEX I BEEJAY INVESTMENTS AND FINANCIAL CONSULTANTS P LTD S 38650 15.80
15/7/2008 520077 AMTEK AUTO L WARHOL LIMITED B 1000000 220.00
15/7/2008 520077 AMTEK AUTO L CITIGROUP GLOBAL MARKETS MAURITIUS PVT LTD S 983672 220.00
15/7/2008 532996 FIRST WIN SEAHEAVEN INVESTMENT MAURITIUS LIMITED S 115000 101.41
15/7/2008 532985 KOTAK SENSEX EDELWEISS SECURITIES LIMITED S 18102 129.82
15/7/2008 505299 KULK POW TOO RAJIV ARORA B 51204 74.10
15/7/2008 505299 KULK POW TOO RAJIV ARORA S 51204 73.98
15/7/2008 511728 KZLEASING YOESH G. PANDYA S 47000 7.65
15/7/2008 500337 PRIME SECU L KANUMANEK TRADING COMPANY L B 140000 37.25
15/7/2008 500337 PRIME SECU L LAADKI TRADING AND INV. LTD. S 140000 37.25
15/7/2008 517214 SPICE MOBIL YUVAK SHARE TRADING PVT.LTD. B 264553 29.92
15/7/2008 517214 SPICE MOBIL YUVAK SHARE TRADING PVT.LTD. S 264553 30.00
15/7/2008 532375 TIPS INDUSTR P. R. TRADERS B 100000 47.75
15/7/2008 532375 TIPS INDUSTR P R AND COMPNAY S 100000 47.75
15/7/2008 532765 USHER AGRO MAYANKKUMAR RAMESHCHANDRA BHAT B 109384 108.02
15/7/2008 531950 VERTEX SECUR AMI STOCK SHARE BROKERS PLTD B 50000 32.00

NSE Bulk Deals to Watch - July 15 2008

Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
15-JUL-2008,AMTEKINDIA,Amtek India Limited,WARHOL LIMITED,BUY,3500000,84.00,-
15-JUL-2008,ANGAUTO,ANG Auto Limited,FIDELITY FUNDS - EMERGING MARKETS FUND,BUY,1056458,74.50,-
15-JUL-2008,EDUCOMP,Educomp Solutions Limited,CITIGROUP GLOBAL MARKETS MAURITIUS PRIVATE LIMITED,BUY,90000,2732.66,-
15-JUL-2008,FIRSTWIN,First Winner Industries L,DIPAK RAMANBHAI RATHOD,BUY,155099,93.20,-
15-JUL-2008,FIRSTWIN,First Winner Industries L,SPS CAPITAL & MONEY MANAGEMENTSERVICES PVT.LTD.,BUY,100000,92.24,-
15-JUL-2008,LOTUSEYE,Lotus Eye Care Hospital L,BALASO VITTHAL SHINDE,BUY,289816,38.14,-
15-JUL-2008,LOTUSEYE,Lotus Eye Care Hospital L,KHATRI ENTERPRISE,BUY,286637,36.85,-
15-JUL-2008,SASKEN,Sasken Commu Techno Ltd,MBL & COMPANY LTD.,BUY,304430,135.96,-
15-JUL-2008,SASKEN,Sasken Commu Techno Ltd,QUEST PORTFOLIO SERVICES PRIVATE LIMITED,BUY,3,134.80,-
15-JUL-2008,AMTEKINDIA,Amtek India Limited,CITIGROUP GLOBAL MKTS MAURITIUS PVT LTD- SELL CODE,SELL,3500000,84.00,-
15-JUL-2008,ANGAUTO,ANG Auto Limited,FIDELITY FUNDS - EMERGING MARKETS FUND,SELL,1056458,74.50,-
15-JUL-2008,FIRSTWIN,First Winner Industries L,DIPAK RAMANBHAI RATHOD,SELL,179950,100.32,-
15-JUL-2008,FIRSTWIN,First Winner Industries L,SPS CAPITAL & MONEY MANAGEMENTSERVICES PVT.LTD.,SELL,100000,93.01,-
15-JUL-2008,KOHINOOR,Kohinoor Foods Limited,SANJEEV ARORA,SELL,150000,105.00,-
15-JUL-2008,LOTUSEYE,Lotus Eye Care Hospital L,BALASO VITTHAL SHINDE,SELL,289816,36.87,-
15-JUL-2008,LOTUSEYE,Lotus Eye Care Hospital L,CHIRAG Y. THAKKAR,SELL,116808,38.16,-
15-JUL-2008,LOTUSEYE,Lotus Eye Care Hospital L,YASHWANTBHAI A. THAKKAR,SELL,200000,38.13,-
15-JUL-2008,PVR,PVR Limited,MATTHEWS INTERNATIONAL FUNDS,SELL,187769,170.00,-
15-JUL-2008,RANBAXY,Ranbaxy Laboratories Ltd,DEUTSCHE SECURITIES MAURITIUS LIMITED,SELL,5138055,427.75,-
15-JUL-2008,SASKEN,Sasken Commu Techno Ltd,MBL & COMPANY LTD.,SELL,304430,135.76,-
15-JUL-2008,SASKEN,Sasken Commu Techno Ltd,QUEST PORTFOLIO SERVICES PRIVATE LIMITED,SELL,152604,136.51,-

Post Session Commentary - July 15 2008

The domestic market ended the day in deep red after going through a blood bath, on the back of strong selling activity in key stocks. The Indian market opened with a heavy gap down, tracking weak cues from the global market. The US financial sector continued to tumble due to uncertainty reigned in the wake of the failure of California-based bank IndyMac. Regulators are worried that the IndyMac did not have enough cash to get by after panicked investors withdrew more than $1.3bn in 11 days and seized its assets. Further, the domestic political uncertainty and the inflation worries also added to the woes that led the market to trade completely on the back foot without showing any sign of recovery and forced it to land in extremely negative territory. The BSE Sensex closed below 12,700 level and NSE Nifty below 3,900. Key indices had witnessed a deeper crack during final trading hours. All the 30-stocks of the Sensex ended in red and also all the BSE Sectoral indices concluded the day with heavy losses. From the sectoral front, Bankex index were completely hammered to close with deep cut of more than 7% as most selling was reported from this basket. Followed this was Capital Goods, Metal and Reality stocks which also closed with cut of more than 5%. The market breadth was negative as 535 stocks closed in green while 2105 stocks closed in red and 57 stocks remained unchanged.

The BSE Sensex closed lower by 654.32 points at 12,676.19 and NSE Nifty ended down by 178.60 points at 3,861.10. The BSE Mid Caps and Small Cap closed with loss of 167.29 points and 209.16 points 5,163.51 and 6,630.90 respectively. The BSE Sensex touched intraday high of 13,067.08 and intraday low of 12,605.00.

Lossers from the BSE are Ranbaxy Lab (14.01%), HDFC Bank Ltd (11.26%), ICICI Bank Ltd (8.72%), Hindalco (8.30%), Hindalco (7.22%), HDFC (6.86%), BHEL (6.66%), Wipro Ltd (6.54%), SBI (6.35%) and DLF Ltd (6.33%).

The Metal index closed down by 671.55 points at 12,225.64. Lossers are JSW SL (8.62%), Hindalco (8.30%), Sh Precoated (7.32%), Hindustan Zinc (6.19%), Sterrlite In (5.73%), Welspan Gujarat Sr (5.65%) and Tata Steel (5.42%).

The Capital Goods Index closed lower by 564.26 points at 10,175.75. Lossers are Alstom Proje (7.26%) along with BHEL (6.66%), Siemens Ltd (6.25), Cropmton Greaves (6.19%), BEML Ltd (6.07%), Punj Lloyd (5.83%) and Suzlon Energy (5.80%).

The Banking index closed lower by 462.52 points at 5,508.00. As HDFC Bank Ltd (11.26%), Yes Bank (9.10%), ICICI Bank Ltd (8.72%), Union Bank (7.65%), SBI (6.35%), and Axis Bank (6.17%) closed in negative territory.

The Oil & Gas index ended down by 307.37 points at 8,677.70. Lossers are Reliance Natural Resources (5.21%), HPCL (5.04%), Essar Oil Ltd (4.34%), BPCL (4.09%), ONGC (3.63%) and Reliance (3.42%).

The Reality index ended down by 259.08 points at 4,503.45. As Purvankara (7.85%), Penland Ltd (6.70%), DLF Ltd (6.33%), Unitech Ltd (6.17%), Omaxe Ltd (5.47%), and Sobha Dev (5.37%) closed in negative territory.

The Pharma index lost 170.67 points to close at 3,909.25. Major lossers are Ranbaxy Lab (14.01%), Matrix Labs (5.16%), Glenmark Pharma (4.98%), Devi’s Lab (4.50), Biocon Ltd (4.18%) and Fortis healt (3.92%).

Bears on a rampage as Sensex tanks 654 points

The key benchmark indices collapsed under the combined weight of weak global markets and domestic political uncertainty. The BSE Sensex today hit its lowest level in more than 15 months. Shares from banking, capital goods and metal sectors collapsed. Ranbaxy Labs plunged on high volumes for the second straight day. All the sectoral indices on BSE posted losses. The market breadth was weak.

Fears over the solvency of major Western banks rattled stocks in Asia and Europe after the US Federal Reserve and Treasury Department mounted a rescue plan to help support top mortgage lenders Fannie Mae and Freddie Mac following the sharp fall last week in their stock prices. On top of the troubles at Fannie and Freddie, two pillars of the US mortgage system, US regulators seized mortgage lender IndyMac Bancorp Inc late last week following withdrawals by panicked clients.

In Europe key benchmark indices in UK, Germany and France were down by between 1.45% and 1.93%. In Asia, key benchmark indices in China, Japan, Hong Kong, Taiwan, Singapore and South Korea were down by between 2.11% and 4.51%.

As per provisional data, foreign funds sold shares worth a net Rs 702.70 crore while domestic funds bought shares worth a net Rs 283.40 crore today, 15 July 2008.

The 30-share BSE Sensex plunged 654.32 points or 4.91% to 12,676.19. It lost 725.51 points at the day's low of 12,605, hit in late trade, a 15-month low. The Sensex opened with a downward gap of 263.43 points.

The broader based S&P CNX Nifty tumbled 178.60 points or 4.42% at 3861.10. Nifty July 2008 were at 3804, at a steep discount of 57.10 points as compared to spot closing.

The BSE Sensex is down 7610.80 points or 37.51% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 8530.58 points or 40.22% away from its all-time high of 21,206.77 struck on 10 January 2008.

Back to today's trade, the market breadth was extremely weak on BSE with 2091 shares declining as compared to 540 that advanced. 59 remained unchanged.

Turnover on BSE slipped to Rs 4,282 crore as compared to Rs 4,474.95 crore yesterday, 14 July 2008. NSE's futures & options (F&O) segment turnover rose to Rs 44,122.92 crore, from Rs 40,096.24 crore on Monday, 14 July 2008.

The BSE Mid-Cap index was down 3.14% to 5,163.51and the BSE Small-Cap index fell 3.15% to 6,430.90. Both these indices outperformed the Sensex.

All sectoral indices on BSE settled with losses. The BSE Power (down 4.91% to 2,224.37), BSE Realty index (down 5.44% at 4,503.45), BSE Metal index (down 5.21% to 12,225.64), BSE Capital Goods index (down 5.25% at 10,175.75), and BSE Bankex (down 7.75% at 5,508), underperformed the Sensex.

The BSE Auto (down 2.50% at 3,477.28), BSE Oil & Gas index (down 3.42% to 8,677.70), BSE PSU index (down 4.37% to 5,821.96), BSE Consumer Durables index (down 3.36% to 3,468.67), BSE TecK index (down 3.36% to 2,789.17), BSE FMCG index (down 3.93% to 1,881.40), BSE Health Care index (down 4.18% at 3,909.25), and BSE IT index (down 2.34% to 3,589.57), outperformed the Sensex.

All the 30-members from the Sensex pack edged lower.

India’s largest pharma company in terms of sales Ranbaxy tumbled 14.90% to Rs 405 on high volumes of 71.66 lakh shares. It was the top loser from the Sensex pack. As per foreign brokerage house UBS, the stock could erode 50% if the deal with Daiichi is called off. The stock continued to suffer losses for the second straight day after plunging 10.86% yesterday on reports the US government has levelled serious allegations against the company.

The US department of justice (DoJ) has said that there was evidence to suggest that Ranbaxy used active pharmaceutical ingredients (API) from unapproved sources, blended unapproved API with approved API, and used less-than-approved API at its Paonta Sahib (Himachal Pradesh) plant in its drugs, resulting in the sale of subpotent, super- potent or adulterated medicines in the US market. Ranbaxy has strongly denied the allegations raised by the US Department of Justice (DOJ).

BSE's banking sector index Bankex tumbled 8.39% to 5,469.85 and was the biggest loser among the sectoral indices on BSE. The banking index had hit 52-week low of 5437.7 touched on 2 July 2008.

India’s second largest private sector bank in terms of net profit HDFC Bank plunged 11.47% to Rs 914.25. India’s largest private sector bank in terms of net profit ICICI Bank tumbled 9.11% to Rs 527, off its 52-week low of Rs 525 hit in intra-day trade.

India’s largest state-run bank in terms of net profit State Bank of India lost 7.93% to Rs 1158. The bank has reportedly recovered Rs 2000 crore in bad loans during April-June 2008 period.

Among the mid-cap bank stocks, Kotak Mahindra Bank (down 7.05% to Rs 458), Axis Bank (down 7.29% to Rs 589.45), Indian Overseas Bank (down 4.59% to Rs 73.80), Bank of India (down 6.51% to Rs 229.10), and Punjab National Bank (down 3% to Rs 390.90), edged lower.

Even though Indian banks have little exposure to the US housing sector, sentiment in the sector across the globe is at an all-time low, and India is no exception. The likely hood of another interest rate hike in light of the inflation situation only makes matters worse for Indian banks.

India’s largest private sector firm by market capitalization and oil refiner Reliance Industries was down 3.75% at Rs 1,970.

Metal shares slipped on selling pressure. Hindalco (down 8.10% to Rs 138.40), Hindustan Zinc (down 6.87% to Rs 542), Sterlite Industries (down 6.42% to Rs 639.30), Tata Steel (down 5.72% to Rs 645), and Steel Authority of India (down 5.52% to Rs 131.75), slumped.

Real estate stocks cracked on renewed selling. DLF (down 5.48% to Rs 430.80), Unitech (down 6.81% to Rs 152.50), Purvankara Projects (down 7.04% to Rs 166.95), and Omaxe (down 6.16% to Rs 121.05), slumped.

Capital goods stocks extended losses after the data showed on Friday, 11 July 2008, that growth in industrial production declined sharply in May 2008. Suzlon Energy (down 5.98% at Rs 185.50), Siemens (down 8.04% at Rs 437.95), Punj Lloyd (down 6.65% at Rs 197), Bharat Heavy Electricals (down 6.95% to Rs 1368), Larsen & Toubro (down 4.97% to Rs 2272.70), declined from capital goods pack.

Reliance Infrastructure (down 7.45% to Rs 757) and HDFC (down 7.39% to Rs 1790) edged lower from the Sensex pack.

India’s largest cellular services provider in terms of market capitalisation Bharti Airtel lost 4.66% to Rs 702.50. Reliance Communication, the country’s second largest cellular services provider in terms of market capitalisation plunged 7.92% to Rs 403.05.

IT pivotals lost ground after firm start. Infosys Technologies (down 1.25% to Rs 1536.45, off day’s high of Rs 1578.65), TCS (down 3.50% at Rs 742, off day’s high of Rs 785), Wipro (down 7.88% at Rs 372.55, off day’s high of Rs 409.95), and Satyam Computer Services (down 2.26% to Rs 400, off day’s high of Rs 424.85), slipped.

Ranbaxy Laboratories was the top traded counter on BSE with turnover of Rs 303.91 crore followed by Reliance Industries (Rs 278.82 crore), Reliance Capital (Rs 261.05 crore), Infosys (Rs 168.11 crore), in that order.

Reliance Natural Resources topped volumes chart on BSE clocking volumes of 1.33 crore shares followed by IFCI (1.29 crore shares), Ispat Industries (1.16 crore shares), Chambal Fertilisers & Chemicals (78.10 lakh shares), and Reliance Petroleum (75.05 lakh shares), in that order.

Orchid Chemicals saw high volatility. The stock, which was trading flat at around Rs 254 for most part of the day plunged to day’s low of Rs 231 only to recover almost all lost ground. The stock settled 0.57% lower at Rs 253.

SpiceJet rose 1.97% to Rs 28.50 after the company said that the US based private equity firm WL Ross & Co LLC will invest about Rs 345 crore in the company.

Sun Pharmaceutical Industries slipped 3.30% to Rs 1293.10 after the company extended the date for tender offer to buy all outstanding shares of Israel's Taro Pharmaceutical Industries. Sun is seeking to force Taro's controlling shareholders to sell their stakes after a merger agreement collapsed in May 2008

TTK Healthcare surged 13.53% to Rs 88.95 after the company said its board will meet on 25 July 2008 to consider buyback of equity shares. The company made this announcement after trading hours yesterday, 14 July 2008.

BEML declined 6.20% to Rs 626.90 even as the company said it has bagged export orders aggregating to Rs 34.50 crore from African countries for the supply of equipments. The company made this announcement before trading hours today, 15 July 2008.

Fitch Ratings today, 15 July 2008, lowered India's domestic rating outlook to negative from stable due to the central government's worsening fiscal position. Fitch has maintained the country's BBB-minus rating for both its local currency rating and its foreign currency rating.

Oil prices hovered around $145 per barrel today, 15 July 2008, close to its record high of $147.27 set on Friday, 11 July 2008.

US stocks tripped yesterday, 14 July 2008, as concerns on the health of the US banking sector mounted after the collapse of IndyMac eclipsed the earlier optimism over the government's plan to stabilise mortgage lenders Fannie Mae and Freddie Mac. The Dow Jones industrial average slipped 45.35 points, or 0.41%, to 11,055.19. The Standard & Poor's 500 index declined 11.19 points, or 0.90%, to 1,228.30, and the Nasdaq Composite index lost 26.21 points, or 1.17%, to 2,212.87.

Back home, the Manmohan Singh government suffered another setback on Monday, 15 July 2008, on reports that at least two important leaders it was counting on for support in the trust vote seemed to be backing off. The two leaders are the Telengana Rashtra Samiti (TRS) chief Chandrashekhar Rao, and the other is DMK’s Dayanidhi Maran. The government is holding a two-day special session of parliament on 21 July 2008 and 22 July 2008 to seek vote of confidence after it was reduced to minority following withdrawal of support by Left parties on 8 July 2008. The government hopes to retain power due to backing from Samajwadi Party, a regional party in Uttar Pradesh.

India-dedicated funds saw $944 million outflows in the month to 9 July 2008, the highest redemption faced by any country-specific funds group in the period, according to EPFR Global data. Redemptions have continued for five weeks in a row leading the Indian benchmark indices to their lowest levels in 15 months. In the week ended 9 July 2008, India-dedicated funds saw an outflow of $215 million, again the highest by any country fund category.

Indian markets also reportedly bore the brunt of redemption from Asia regional funds, which have considerable allocations to Indian markets.

Market headed for weak start

Local equities are set to extend losses for the third straight day today, 15 July 2008 amid weak global cues over concerns about the fallout from the credit crisis. Political uncertainty along with the continued redemption pressure from funds may continue to weigh on the sentiment in the near term.

The Manmohan Singh government suffered another setback on Monday, 15 July 2008, on reports that at least two important leaders it was counting on for support in the trust vote seemed to be backing off. The two leaders are the Telengana Rashtra Samiti (TRS) chief Chandrashekhar Rao, and the other is DMK’s Dayanidhi Maran. The government is holding a two-day special session of parliament on 21 July 2008 and 22 July 2008 to seek vote of confidence after it was reduced to minority following withdrawal of support by Left parties on 8 July 2008. The government hopes to retain power due to backing from Samajwadi Party, a regional party in Uttar Pradesh.

India-dedicated funds saw $944 million outflows in the month to 9 July 2008, the highest redemption faced by any country-specific funds group in the period, according to EPFR Global data. Redemptions have continued for five weeks in a row leading the Indian benchmark indices to their lowest levels in 15 months. In the week ended 9 July 2008, India-dedicated funds saw an outflow of $215 million, again the highest by any country fund category. A fall in local currency erodes foreign investors earnings, if any, and accentuates losses. The Indian rupee has depreciated over 10% since the first week of May 2008.

Indian markets also reportedly bore the brunt of redemptions from Asia regional funds, which have considerable allocations to Indian markets.

August crude settled up 10 cents at $145.18 a barrel yesterday, 15 July 2008 on the New York Mercantile Exchange.

Asian markets were trading lower today, 15 July 2008, as the worsening situation of credit markets took a toll on financial shares. China's Composite dropped 0.52% or 14.89 points at 2,863.36, Japan's Nikkei plunged 1.48% or 193.20 points at 12,816.96, Hong Kong's Hang Seng declined 2.58% or 567.57 points at 21,446.89, Taiwan Weighted slipped 3.34% or 238.78 points at 6,918.18, Singapore's Straits Times was down 1.54% or 44.58 points at 2,859.54 and South Korea's Seoul Composite fell 2.38% or 37.17 points at 1,521.45

US stocks tripped yesterday, 14 July 2008, as concerns on the health of the US banking sector mounted after the collapse of IndyMac eclipsed the earlier optimism over the government's plan to stabilise mortgage lenders Fannie Mae and Freddie Mac. The Dow Jones industrial average slipped 45.35 points, or 0.41%, to 11,055.19. The Standard & Poor's 500 index declined 11.19 points, or 0.90%, to 1,228.30, and the Nasdaq Composite index lost 26.21 points, or 1.17%, to 2,212.87.

Back home, stocks ended volatile session with losses for the second straight day yesterday, 15 July 2008, on sustained selling in IT and select blue-chip stocks. The 30-share BSE Sensex was down 139.34 points or 1.03% at 13,330.51 and the S&P CNX Nifty fell 9.03 points or 0.23% to 4039.70, on that day.

The BSE Sensex is down 6956.48 points or 34.29% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 7876.26 points or 37.14% away from its all-time high of 21,206.77 struck on 10 January 2008.

As per provisional data, foreign funds sold shares worth a net Rs 436.52 crore while domestic funds bought shares worth a net Rs 63.25 crore yesterday, 14 July 2008.

Foreign institutional investors (FIIs) were net sellers of Rs 605.98 crore in the futures & options segment on 15 July 2008. They were net sellers of index futures to the tune of Rs 103.13 crore and sold index options worth Rs 178.69 crore. They were net sellers of stock futures to the tune of Rs 327.61 crore and purchased stock options worth Rs 3.46 crore.

Meanwhile, the Centre’s excise duty collections grew 2.8% to Rs 25,882 crore in Q1 June 2008 over in Q1 June 2007. For 2008-09, the Centre has pegged the excise duty budget estimate at Rs 1,37,874 crore, which represented an increase of 5.9% over the budget estimate of Rs 1,30,220 crore for 2007-08.

Pre Session Commentary - July 15 2008

The Indian Market is expected to have negative opening on the back of weak global cues as US market closed with losses and Asian markets are trading in deep red. On Monday, the Indian market closed in red. The domestic market opened in negative territory, tracking weak cues from the US markets but showed some recovery in the mid session led by the European markets on the back of the US government announcement to prop up troubled mortgage financiers Fannie Mae and Freddie Mac. Market was not able to sustain the momentum and slipped further to close on back foot. From the sectoral front, metal index was remained in the limelight as most of the buying was witnessed from this basket while selling pressure led by the weakness in IT, Bank and Pharma stocks. The BSE Sensex closed lower by 139.34 points at 13,330.51 and NSE Nifty ended down by 9.30 points at 4,039.70. We expect that market may decline further during the trading session.

On Monday, the US market was closed in red as banks dragged down the market. Failure of Indy Mac Bank hits the financial sector, which is seventh bank to fail since the credit crisis began last summer, and the second-largest bank to fail in the Federal Deposit Insurance Corp.''s 75-year history. Regulators are worried that the California-based bank did not have enough cash to get by after panicked investors withdrew more than $1.3bn in 11 days and seized its assets. Crude oil prices ended up at $145.18 a barrel on the New York Mercantile Exchange also added to the negative sentiment.

The Dow Jones Industrial Average (DJIA) closed lower by 45.35 points at 11,055.19 along with NASDAQ trading down by 26.21 points at 2,212.87 and S&P 500 index closed lower by 11.19 points at 1,228.30.

Indian ADRs ended down. In technology sector, Wipro ended down by (2.90%) along with Patni Computers by (2.71%), Infosys by (2.60%) and Satyam dropped by (2.30%). In banking sector, HDFC bank and ICICI bank lost (2.70%) and (1.20%) respectively. In telecommunication sector, Tata Communication remained unchanged and MTNL ended down by (0.23%). Sterlite industries increased by (2.32%).

Today the major stock markets in Asia are trading in red. Hang Seng index is trading lower by 567.57 points at 21,446.89 along with Japan’s Nikkei trading down by 193.20 points at 12,816.96 and Taiwan Weighted trading at 6,918.18 dropped by 238.78 points.

The FIIs on Monday stood as net seller in equity. The gross equity purchased was Rs2,420.10 Crore and the gross debt purchased was Rs0.00 Crore while the gross equity sold stood at Rs2,730.40 Crore and gross debt sold stood at Rs0.00 Crore. Therefore, the net investment of equity reported was (Rs310.30) Crore and net debt was Rs0.00 Crore.

Today, Nifty has support at 3,864 and resistance at 4,102 and BSE Sensex has support at 12,762 and resistance at 13,586.

Slide may continue

Market may slide further on account of weak Asian markets in morning trades and overnight fall in the US markets. Surge in Crude oil Prices and continued selling pressure may also drag the domestic indices further down. The FIIs remained net sellers in equities for last couple of sessions may also weigh on the investors' sentiment. Key indices, the Nifty may get support at 4000 level and on the upside it could test higher levels at 4070. The Sensex has a likely support at 13,270 and may face resistance at 13,450.

US indices declined on Tuesday with the Dow Jones slipped marginally at 11055 down 45 points, while the Nasdaq lost 26 points to close at 2213.

Indian ADRs had a mixed outing on the US bourses. Among the major losers Wipro, Infosys, HDFC Bank, Satyam, Patni Computers, ICICI Bank and MTNL shed over 0.20-2% each. While, Dr Reddy's and Rediff gained marginally.

Crude oil prices gained marginally, with the Nymex light crude oil for August delivery moved up by 10 cents to close at $145.18 a barrel. In the commodity space, the Comex gold for August series gained $13.10 to settle at $973.70 a troy ounce.

Morning Call - July 15 2008

Market Grape Wine :

In House :

Nifty at a support of 4000 and 3995 levels with resistance at 4118 and 4170 levels .

Cash: Buy INDIA INFOLINE above 688 target 710 with S/L 678

Cash: Sell RELINFRA below 818 targets 795 with S/L 830.

Future: Sell LITL Below 291 target 275 With S/L 303

Future: Sell CENTEX below 490 Target 465 with S/L 505

Out House:

Markets at a support of 13013 & 12786 resistance at 13456 & 13542 levels .

Buy : Tisco at dips

Buy : Sbin at dips

Buy : Hdfc at dips

Buy : LT at dips

Buy : ACC at dips

Buy : RIL at dips

Dark Horse : Coreproject , LT , RIL , HLL & Tisco

Technicals - July 15 2008

Technicals - July 15 2008

Daily Technicals - July 15 2008

Daily Technicals - July 15 2008

Trading Calls - July 15 2008

Nifty (4040) Sup 3950 Res 4100

Buy HUL (219) SL 215 Tgt 225, 228

Buy HIND Zinc (582) Sup 574 Target 598, 602

Sell ICICI Bank (580) SL 586 Target 570, 567

Sell Suzlon (196) SL 200
Target 189, 187

Sell HDFC (1934) SL 1960
Target 1885, 1875

Adjust to the wind, avoid a windfall!

“The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.”

The winds of political change have been blowing for some time. Large corporate bodies are quick to make necessary adjustments. It was no surprise that Reliance Chairman Mukesh Ambani chose to visit New Delhi and meet important government functionaries to express his point of view on the issue of windfall tax. In a choppy market, Reliance managed to recover sharply.

Market participants too have to adjust to the changing winds. It is better to take a longer term view because by the time you try to make quick adjustments, the direction of the wind may change. Some buying may be seen in mid cap counters. HUL could be among the safer stocks for the time being.

We understand a handful of people may be active on select counters. Some buying is also happening on the hopes that if the government sails through with a confidence vote, the markets will give a thumbs’ up and see some short term spurt. These are high risk events. With no major results expected today, indices may swing in and out of negative territory.

Ranbaxy may see some recovery after the company clarified that its deal with Daiichi is on track. Earlier reports stated production at three facilities of Ranbaxy Laboratories could be banned if charges of fraud, forging of documents and manufacturing from unapproved locations leveled by USFDA are proved.

Last weekend it was news about Fannie Mae and Freddie Mac and IndyMac which haunted the bulls on Wall Street. Now fears that Merrill Lynch and Citigroup will report another quarterly loss is keeping up the pressure. As if all this was not enough, National City and Washington Mutual(WaMu) witnessed sharp erosion as WaMu crashed nearly 35%. A Lehman Brothers note said it may need to substantially boost its reserves over the rest of the year to cover home loan losses.

The Dow Jones fell 0.4% and closed at its lowest point since July 21, 2006. The Standard & Poor's 500 index fell 0.9% and closed at June 2006 lows. The Nasdaq dropped 1.2% but managed to stay above its March lows. Asian stocks fell yet again led by financial companies, on mounting concern credit-market losses will widen. Japan's Nikkei 225 Stock Average fell 1.4% to 12,830.20.

Oil prices, which swung between $142.49 and $146.37 a barrel ended flat. Light, sweet crude for August delivery rose 10 cents to settle at $145.18 a barrel on the New York Mercantile Exchange trading. On Friday it had hit a record trading high of $147.27.

Sun Pharmaceutical announced its subsidiary, Alkaloida Chemical has extended the expiration date of the tender offer for purchase of all outstanding Ordinary Shares of Taro Pharmaceutical Industries Ltd. (Taro). The Offer has been extended to September 2, 2008. Earlier, a report stated Templeton Asset Management – a prominent shareholder of Taro has dumped Sun Pharma’s unsolicited tender offer.

Steel companies could see some action on reports that they are considering 15% hike in prices to offset rising raw material costs. Meanwhile, the railways has reportedly decided to give a 25% discount on domestic iron ore freight booked to ports in a bid to help steel companies.

Among the major bulk deals, Merrill Lynch sold 200,000 shares of Selan Exploration at an average price of Rs217.

Insider trades:

Sakthi Sugars: M.Manickam, Vice Chairman & Managing Director of the company from the market has purchased 10,499 equity shares on 10th July 2008.

Gateway Distriparks: Kirpa Ram Vij, Director of the company has purchased 15,000 shares from the open market on 9th July 2008.

Indian bourses ended on a mixed note on Monday with Nifty closing almost flat. However, benchmark Sensex further lost over 130 points after losing over 450 points on Friday.

Bulls were able to hold on to their gains for major part of the day, but lost ground towards the fag end of the session.

The down fall could be attributed to selling witnessed in IT heavyweights like Infosys, Satyam and TCS. Even the broader Sectoral indices i.e. the Mid-Cap and the Small-Cap indices were under pressure.

Finally the Sensex lost 139 points to close at 13,330 and the Nifty slipped 9 points to close flat at 4,039.

Axis Bank slipped by 5% to Rs635. The company announced its Q1 results with net profit at Rs3.30bn (up 88.5%) and interest income at Rs22.70bn (up 47%). The scrip touched an intra-day high of Rs692 and a low of Rs627 and recorded volumes of over 17,00,000 shares on BSE.

Shares of Ranbaxy fell over 10% to Rs475 after the U.S. federal government said that it was investigating whether Ranbaxy Laboratories Ltd. destroyed reports it was required to keep, inaccurate data and failed to meet quality control specifications in manufacturing the generic drugs it sells. The scrip touched an intra-day high of Rs522 and a low of Rs470 and recorded volumes of over 28,00,000 shares on BSE.

HCL Technologies plunged by 6% to Rs225 after the company said that its foreign-exchange losses may total as much as US$77mn in the year ended June 30. The scrip touched an intra-day high of Rs229 and a low of Rs206 and recorded volumes of over 3,00,000 shares on BSE.

Era Infra gained by 1.2% to Rs570 after the company announced that it secured civil, structural & architectural work worth Rs955mn from BHEL for main power block along with its Auxiliaries and BOP for 1 x 500 MW Thermal Power Station, Extension Unit # 6, Gujarat State Electricity Corporation Ltd at Ukai, Dist. Tapi, Gujarat. The scrip touched an intra-day high of Rs573 and a low of Rs545 and recorded volumes of over 10,000 shares on BSE.

NDTV surged by over 2% to Rs405 after 6.1% of the company’s equity changed hands in a single trade. As many as 3.8mn shares were traded at Rs447.8 per share on BSE. The scrip touched an intra-day high of Rs447.80 and a low of Rs397 and recorded volumes of over 43,00,000 shares on BSE.

Sterlite Technologies advanced by 1.5% to Rs200 after the company announced that it secured a contract worth US$15.5mn in Africa and SAARC. The scrip touched an intra-day high of Rs205 and a low of Rs191 and recorded volumes of over 44,000 shares on BSE.

Madhucon Projects rallied by over 6% to Rs307 after the company announced that it secured EPC contract worth Rs9.89bn for setting up of Thermal Power Plant in Krishnapatnam South, Nellore District of Andhra Pradesh. The scrip touched an intra-day high of Rs332 and a low of Rs290 and recorded volumes of over 22,000 shares on BSE.

Reliance Industries has hired 17 banks to arrange for a US$1bn debt facility to fund its expansion projects. (BS) Production at three facilities of

Ranbaxy Laboratories could be banned if charges of fraud, forging of documents and manufacturing from unapproved locations leveled by USFDA are proved. (BS)

The ministry of broadcast and information has sent a show cause notice to Bharti Group’s DTH subsidiary to question its compliance with FDI norms. (BS)

- HDFC is raising Rs5bn via private placement of bonds with LIC. (BL)

- SBI has recovered bad loans worth ~Rs20bn during April-June 2008. (ET)

- NTPC may bid to acquire thermal plants in Oman. (FE)

- NTPC would get a term loan of Rs100bn from PFC to finance its debt portion of big ticket projects for XI plan. (FE)

- PFC and Reliance Infra JV has received approval for transmission licence from CERC. (FE)

- Templeton Asset Management – a prominent shareholder of Taro has dumped Sun Pharma’s unsolicited tender offer. (ET)

- Indian Hotels is believed to be exploring the Philippines market to set up hotels and resorts there. (DNA)

- REC is keen on picking up stakes in upcoming power plants in coal-rich states. (DNA)

- Indian Oil Corp expects the Government to issue letters promising oil bonds for Q1 FY09. (DNA)

- IFCI will bid to buy non-performing assets of the now-shut IIBI Ltd. (DNA)

- Jet Airways is likely to increase fuel surcharge by up to Rs200 per sector for domestic flights. (ET)

- The government has permitted Jet Airways to commence a daily flight from Mumbai and Delhi to Saudi Arabia. (BL)

- BSNL plans to invest Rs50bn in its Wimax project. (BS)

- Lafarge plans to invest US$1bn over the next five years in India to raise its cement manufacturing capacity to 20mn tons. (BS)

- As per South African media, MTN could go back to discussions with Bharti Airtel. (BS)

- Ispat Industries is set to get an iron ore mine in Jharkhand. (BS)

- The Navratna status of HPCL and BPCL will be retained. (FE)

- Netherlands Development Finance has extended an ECB worth US$25mn to Alok Industries. (BS)

- Blue Star has got an order worth Rs1.04bn from Delhi Metro Rail Corp Ltd for air-conditioned of seven metro stations. (DNA)

- US-based telecom equipment vendor UTStarcom has entered into a new deal with Aksh Optifibre for expansion of the latter’s Internet protocol TV services. (DNA)

- NIIT has joined hands with global electronic testing firm Pearson VUE to offer IT and non-IT tests for students and professionals across the country. (DNA)

- Union Bank of India and Belgian firm KBC Asset Management Company have entered into a JV to set up a mutual fund in India. (ET)

- Union Bank of India has projected a 25% growth in business for the current fiscal. (FE)

- HCL Comnet, a subsidiary of HCL Technologies announced a five-year, RS600mn network outsourcing deal with Union Bank of India. (ET)

- Sterlite Technologies has bagged three contracts worth US$15.5mn in Asia and Africa. (BS)

- SRF is going to acquire South Africa based Industex Technical Textiles for a sum of Rs200mn. (BS)

- Siemens has bagged a Rs2bn contract from Ceylon Electricity Board, Sri Lanka. (BS)

- BEML has secured orders for Rs345mn from African countries Tunisia and Malawi. (BS)

- Madhucon Projects has bagged Rs9.89bn order for setting up a thermal power plant in Andhra Pradesh. (BL)

- Vakrangee Softwares has bagged a electoral project in Maharashtra for the delimitation exercise. (ET)

- RPG Group’s retail venture - Books and Beyond plans to roll out another 10-12 stores over the next 6-8 months and targets Rs1.5-2bn revenues over the next 18-24 months. (ET)

- Jubilant Biosys, a subsidiary of Jubiliant Organosys has announced a drug discovery partnership deal with US-based biotech company Amgen Inc. (BL)

- Emaar Properties has decided to invest US$150mn into specific projects of Emaar MGF Land Ltd, the Indian joint venture between MGF Development Ltd and itself. (BL)

Economic Front Page

- Steel companies are considering 15% hike in prices to offset rising raw material costs. (BS)

- Production from Panna-Mukta gas field is expected to be normalized in the next two-three days. (BL)

- Indirect tax collections grew 9.2% in June 2008. (BS)

Axis Bank

Axis Bank

Axis Bank

Axis Bank

Today's Pick - Ambuja Cements

We recommend a buy in Ambuja Cements from a short-term perspective. From the charts of Ambuja Cements we see that the stock has been on an intermediate-term downtrend from its life-time high of Rs 160 (recorded on December 4, 2007). However, this downtrend got arrested at around Rs 70 two weeks back and reversed direction. We also note that this down trend has retracted 61.8 per cent fibonacci retracement level of its prior long-term bull run and has found support recently. The stock has been moving up from early July. This reversal has been supported by positive divergence in daily relative strength index (RSI) and daily moving average convergence and divergence (MACD). The daily RSI is rising in the neutral zone and the weekly RSI has recovered from the oversold region. The MACD is signalling a buy. The stock crossed over the 21-day moving average on July 14. We are bullish on the stock in the short-term. We expect the stock’s current up move to continue until it hits our price target of Rs 92 in the approaching trading sessions. Traders with short-term perspective can buy the stock while maintaining stop-loss at Rs 78.

via BL

A bright day for bullion metals

Gold’s appeal as a safe investment tool increases further

Traders ran to acquire gold today, Monday, 14 July, 2008 as the metal’s appeal as a safe-haven increased all the more after tensions intensified at Middle East and also as the US Market continued to cripple with the financial crisis. Gold is typically seen as a safe-haven investment and its appeal increases during times of heightened geopolitical tensions. The increase in energy costs also generally increase demand for the precious metal as a hedge against inflation. Silver prices gained for the day.

Comex Gold for August delivery rose $13.1 (1.4%) to close at $973.7 ounce on the New York Mercantile Exchange. Prices climbed to a high of $975.2 during intra day trading. Last week, it ended higher by $27 (2.8%). On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped since then.

It was reported today that Israeli warplanes held maneuvers over Iraq, possibly preparing for a strike against Iran. Last week, Iran test fired more missiles on Thursday, after testing missiles the day before that could reach Israel. Iran is the world's fourth-largest exporter of crude oil.

At the currency markets on Monday, the dollar pared most of its gains as the government's weekend rescue of Fannie and Freddie highlighted fears about the U.S. financial sector. The dollar index which tracks the performance of the greenback against a basket of other major currencies, edged up 0.1% to 71.96.

In the crude market on Monday, crude oil was little changed amid concern that supplies from Brazil may be disrupted and as the dollar strengthened against the euro, reducing the appeal of commodities as a currency hedge for investors. Crude for August delivery settled up 10 cents at $145.18 a barrel on the New York Mercantile Exchange.

The weakening dollar and higher global demand for raw materials have led to records this year for commodities including gold. Gold has traditionally been used as a safe-haven asset against rising inflation. Investor sentiments are boosted by the fact that gold and silver are alternate sources of good investment in the face of declining dollar and rising energy prices.

Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies. On the other hand, a lower dollar pushes up precious metal prices as their demand lessens as it becomes cheaper for traders holding other currencies.

Gold prices ended June, 2008 with a gain of 4.1%. The yellow metal ended second quarter with a marginal gain of 0.7%. In May, it ended with a gain of higher by $22.5 (2.5%). Before May, for April, prices closed lower by 6.3%.

This year, gold prices have gained 16% till date against a 5.5% drop for the dollar against the euro. For first quarter prices gained 10.7%. In January, prices gained 11%, the highest monthly gain since April 2006. For February, it gained 6%. But in March, prices succumbed and fell by 5.5%.

On Monday, Comex silver futures for September delivery gained 43 cents (2.3%) to $19.25 an ounce. Silver has gained 29% in 2008 till date. For the second quarter, it gained a paltry 1.4%.

Silver prices ended the month of May 2008 with a gain of 2.7%. For April, it closed lower by 5.5%. Silver had gained 16% in Q1. In January this year itself, prices climbed 14%. In February, it gained another 15%. For March, it ended lower by 13%. The metal had climbed 16% in FY 2007. The metal also has gained for seven straight years.

During last week of June, Federal Reserve yesterday sharpened its focus on inflation, saying that the upside risks to inflation have increased. Fed held its target for short-term interest rates steady at 2%.

Since last September, Fed has axed interest rates seven times and brought it down to 2%. On the other hand, after keeping interest rates unchanged at 4% since June, 2007, ECB hiked the same to 4.25% last month.

Gold had witnessed the greatest annual gain in twenty eight years by gaining $200/ounce (31%) in FY 2007 as lower interest rates had sent the dollar tumbling, and crude-oil prices rose to a record. In 2006, silver had jumped 46% while gold gained 23%.

At the MCX, gold prices for August delivery closed higher by Rs 129 (0.96%) at Rs 13,482 per 10 grams. Prices rose to a high of Rs 13,520 per 10 grams and fell to a low of Rs 13,245 per 10 grams during the day’s trading.

At the MCX, silver prices for September delivery closed Rs 451 (1.7%) higher at Rs 26,709/Kg. Prices opened at Rs 26,220/kg and rose to a high of Rs 26,848/Kg during the day’s trading.

Crude settles almost unchanged

Prices witness extreme volatility as employees at Brazil’s oil company strike

Crude oil was little changed today, Monday, 14 July, 2008 amid concern that supplies from Brazil may be disrupted and as the dollar strengthened against the euro, reducing the appeal of commodities as a currency hedge for investors. Prices witnessed considerable volatility throughout the day.

Crude-oil futures for light sweet crude for August delivery today closed at $145.18/barrel (higher by $0.10/barrel or 0.01%) on the New York Mercantile Exchange. It fell $2.59 to an intraday low of $142.49 in overnight electronic trading, but also rose to an intraday high of $146.37. Last week, prices gained $0.21 (0.2%).

Employees of Petroleo Brasileiro SA, Brazil's state oil company, began a five- day strike in an area home to more than 80% of the country's output.

Crude prices gained 38% in the second quarter of this year. It was the biggest quarterly increase in nine years. It ended June 2008 higher by 9.9%. Prices are 105% higher than a year ago. For the year, crude is up by 44% till date.

At the currency markets on Monday, the dollar pared most of its gains as the government's weekend rescue of Fannie and Freddie highlighted fears about the U.S. financial sector. The dollar index which tracks the performance of the greenback against a basket of other major currencies, edged up 0.1% to 71.96.

Against this backdrop, August heating oil fell 1.2 cent (0.3%) to $4.065 a gallon and August natural gas edged up 5.5 cents, or 1.5%, to $11.959 per million British thermal units. August reformulated gasoline settled at $3.558 a gallon, down slightly.

At the MCX, crude oil for July delivery closed at Rs 6,206/barrel, higher by Rs 7 (0.11%) against previous day’s close. Natural gas for July delivery closed at Rs 511.9/mmbtu, higher by Rs 0.3/mmbtu (0.05%).