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Friday, August 08, 2008
Weekly Newsletter - Aug 8 2008
For the last five weeks, indices have been ending in the green despite the choppiness in the interim. The next week, though shortened due to Independence Day could see a positive end. We are betting on better IIP numbers to help the bulls stay in control. Besides, statement that crop production is satisfactory should ease worries in many quarters. Crude prices and global market swings will continue to dictate the opening and closings of our market.
Confidence level may still be lower but we expect large caps to display some strength. In case the stocks overshoot, the usual profit booking would always be there. Again, use any gains to lighten positions or reshuffle your portfolio. Avoid trying to make quick bucks on small caps. You could just get stuck with them.
Govt woos BSNL staff with ESOPs
With the Left parties out of the way and stability no longer an issue, the Government has gradually started the reforms process. Among the first signs of this came this week after the NHPC filed a revised DRHP with capital market regulator SEBI and Telecom Minister made attempts at pacifying BSNL employees for the mega IPO of the telecom behemoth.
Coming to the BSNL IPO, the Government asked BSNL and its employee unions to carry forward healthy discussions on the proposed IPO. Telecom Minister Thiru A. Raja met representative of the unions and BSNL officials to discuss the matter. Raja said BSNL employees will get 500 shares of Rs10 each, translating into a net gain of about Rs1.5 lakh.
The offer was made in exchange for the unions dropping their opposition to BSNL's IPO. However, the unions rejected the offer. The joint forum of the BSNL unions, the umbrella body for all employee unions of the PSU, said this was a ploy to divide the employees. The BSNL board has cleared the proposal to sell up to 10% stake in the company. The company's employees have forced the PSU to put off IPO plans twice in the past.
NHPC plans to hit the capital market next month. It plans to sell 1.67bn shares of Rs10 each. The shares would be offered at a premium through a 100% book building process. The IPO would comprise 10% fresh equity and 5% disinvestment of government stake. Last year, NHPC had filed DRHP but SEBI rejected the same as the company did not have the required strength of independent directors.
Moody's sees higher economic risks for India
Moody's Investors Service said that the risks confronting India's economy have grown, but not yet to the extent that the Government's Baa3 foreign currency and Ba2 local currency ratings are threatened. "Higher oil prices and the lack of adequate fiscal policy reactions amidst high pent-up price pressures are putting the burden of macro-economic adjustment on the monetary authorities," said Aninda Mitra, a VP/Senior Analyst with Moody's Sovereign Risk Unit. As a result, policy as well as market interest rates could rise, and a sharp deceleration in growth may follow, Mitra added.
Concurrently, greater government borrowing needs, while not leading to a material deterioration of its key credit metrics, would likely prevent an improvement in the remainder of FY09, contrary to Moody's earlier expectation, Mitra said. Furthermore, political issues play a role in India's fiscal problems, he said in a report. The Government's fiscal difficulties relate partly to its inability to raise retail fuel prices and reduce the growing, off-budget fiscal cost of reimbursing downstream oil companies as part of its subsidies program, Mitra said.
"While Moody's overall assessment is that the current constellation of risks is captured in the prevailing stable outlook, downside pressures could emerge," Mitra said, adding that the sources would be two fold. Firstly, they could involve deteriorations in the government's general debt metrics and its access to external liquidity, given intensified commodity price shocks and an inadequate fiscal response. Secondly, such pressures could be due to the rising risk of fiscal spillovers to India's external accounts; such spillovers, if large enough, could weaken the case for the two-notch gap between its foreign currency and local currency ratings," says Mitra.
Finally, Mitra said in his report that the outlook for economic reforms remains uncertain, even though the Congress-led administration has seen off its leftist partners and re-shuffled its coalition. The author noted that, elections are due in less than a year's time, and it is not clear whether the new coalition partners would support further reforms that could alleviate the country's economic stresses.
NSE Bulk Deals to Watch - Aug 8 2008
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
08-Aug-08,ADLABSFILM,Adlabs Films Limited,A TO Z STOCK TRADE PRIVATE LIMITED,BUY,296410,561.84,-
08-Aug-08,AFTEK,Aftek Limited,UMANG NEMANI,BUY,678122,44.76,-
08-Aug-08,APTECHT,Aptech Limited,MANSUKH SECURITIES & FINANCE LTD,BUY,248682,223.08,-
08-Aug-08,ASIANELEC,Asian Electronics Ltd,DYNAMIC STCOK BROKING (I) PVT LTD,BUY,166721,100.67,-
08-Aug-08,NAGARFERT,Nagarjuna Fert & Chem,CLEAN FINANCE & INVESTMENT LTD,BUY,3652624,41.98,-
08-Aug-08,OCTAV,Octav Investments Limited,AMBIT SECURITIES BROKING PVT. LTD.,BUY,70178,87.89,-
08-Aug-08,OCTAV,Octav Investments Limited,APOLLO SINDHOORI COMMODITIES TRADING LTD.,BUY,15360,95.33,-
08-Aug-08,OCTAV,Octav Investments Limited,ARUN GOEL,BUY,16258,95.77,-
08-Aug-08,OCTAV,Octav Investments Limited,B K SHAH CO KETAN BHAILAL SHAH,BUY,137083,102.62,-
08-Aug-08,OCTAV,Octav Investments Limited,BATHLA & CO PVT LTD,BUY,20255,82.65,-
08-Aug-08,OCTAV,Octav Investments Limited,CHOKHANI SECURITIES LTD,BUY,50831,93.08,-
08-Aug-08,OCTAV,Octav Investments Limited,CPR CAPITAL SERVICES LTD.,BUY,65180,90.76,-
08-Aug-08,OCTAV,Octav Investments Limited,HARBUX SINGH SIDHU,BUY,17555,79.31,-
08-Aug-08,OCTAV,Octav Investments Limited,MANSUKH SECURITIES & FINANCE LTD,BUY,48887,89.62,-
08-Aug-08,OCTAV,Octav Investments Limited,MBL & COMPANY LTD.,BUY,34860,89.94,-
08-Aug-08,OCTAV,Octav Investments Limited,MLB CAPITAL PVT LTD,BUY,35800,87.53,-
08-Aug-08,OCTAV,Octav Investments Limited,MOHANACHANDRA BABU M [TV] [PT],BUY,21885,90.45,-
08-Aug-08,OCTAV,Octav Investments Limited,NEERAJ NISHCHAL,BUY,29427,90.96,-
08-Aug-08,OCTAV,Octav Investments Limited,NIKUNJ K SHAH,BUY,20024,101.64,-
08-Aug-08,OCTAV,Octav Investments Limited,OPG SECURITIES PVT. LTD.,BUY,15724,95.98,-
08-Aug-08,OCTAV,Octav Investments Limited,R.M. SHARE TRADING PVT LTD,BUY,25802,104.93,-
08-Aug-08,OCTAV,Octav Investments Limited,SANTOSH KUMAR AGARWAL,BUY,27052,92.95,-
08-Aug-08,OCTAV,Octav Investments Limited,SATYA FINANCIAL SERVICES PROP ADARSH KUMAR AGGARWAL,BUY,18778,90.18,-
08-Aug-08,OCTAV,Octav Investments Limited,SATYA NARAYAN,BUY,19137,95.45,-
08-Aug-08,OCTAV,Octav Investments Limited,SHIVAKUMARA M,BUY,16725,88.83,-
08-Aug-08,OCTAV,Octav Investments Limited,SMC GLOBAL SECURITIES LTD.,BUY,78447,93.52,-
08-Aug-08,OCTAV,Octav Investments Limited,TATA TD WATERHOUSE TRUSTEE CO. PVT. LTD.,BUY,882,94.98,-
08-Aug-08,OCTAV,Octav Investments Limited,THATTAMPARAMBIL KUNJU VIJAYAN,BUY,28149,91.74,-
08-Aug-08,OCTAV,Octav Investments Limited,TRANSGLOBAL SECURITIES LTD.,BUY,85949,95.99,-
08-Aug-08,OCTAV,Octav Investments Limited,VIJAY KUMAR TRIPATHI,BUY,16747,88.84,-
08-Aug-08,OCTAV,Octav Investments Limited,VIMALA.S.,BUY,25337,89.06,-
08-Aug-08,OCTAV,Octav Investments Limited,YUVAK SHARE TRADING PVT LTD,BUY,22117,103.2,-
08-Aug-08,RUCHISOYA,Ruchi Soya Inds Ltd.,EMSAF MAURITIUS,BUY,1902456,80,-
08-Aug-08,SELMCL,SEL Manufacturing Company,B K SHAH CO KETAN BHAILAL SHAH,BUY,167204,579.32,-
08-Aug-08,SELMCL,SEL Manufacturing Company,DKG SECURITIES PVT LTD.,BUY,138324,581.59,-
08-Aug-08,SELMCL,SEL Manufacturing Company,DKG SECURITIES PVT. LTD.,BUY,186930,582.9,-
08-Aug-08,ADLABSFILM,Adlabs Films Limited,A TO Z STOCK TRADE PRIVATE LIMITED,SELL,296410,561.85,-
08-Aug-08,APTECHT,Aptech Limited,MANSUKH SECURITIES & FINANCE LTD,SELL,252692,222.99,-
08-Aug-08,ASIANELEC,Asian Electronics Ltd,DYNAMIC STCOK BROKING (I) PVT LTD,SELL,157393,100.64,-
08-Aug-08,NAGARFERT,Nagarjuna Fert & Chem,CLEAN FINANCE & INVESTMENT LTD,SELL,3652624,42.01,-
08-Aug-08,OCTAV,Octav Investments Limited,AMBIT SECURITIES BROKING PVT. LTD.,SELL,70178,87.77,-
08-Aug-08,OCTAV,Octav Investments Limited,APOLLO SINDHOORI COMMODITIES TRADING LTD.,SELL,11750,92.31,-
08-Aug-08,OCTAV,Octav Investments Limited,ARUN GOEL,SELL,2858,105.29,-
08-Aug-08,OCTAV,Octav Investments Limited,B K SHAH CO KETAN BHAILAL SHAH,SELL,137083,103.22,-
08-Aug-08,OCTAV,Octav Investments Limited,BATHLA & CO PVT LTD,SELL,18440,83.66,-
08-Aug-08,OCTAV,Octav Investments Limited,BLACKROCK ADVISORS LLC A/C THE MASTER TRUST BANK OF JAPAN,SELL,66530,88.2,-
08-Aug-08,OCTAV,Octav Investments Limited,CHOKHANI SECURITIES LTD,SELL,50831,93.05,-
08-Aug-08,OCTAV,Octav Investments Limited,CPR CAPITAL SERVICES LTD.,SELL,65180,90.92,-
08-Aug-08,OCTAV,Octav Investments Limited,HARBUX SINGH SIDHU,SELL,17555,79.77,-
08-Aug-08,OCTAV,Octav Investments Limited,HDFC MF A/C GROWTH FUND,SELL,50327,83.2,-
08-Aug-08,OCTAV,Octav Investments Limited,MANSUKH SECURITIES & FINANCE LTD,SELL,48262,89.26,-
08-Aug-08,OCTAV,Octav Investments Limited,MBL & COMPANY LTD.,SELL,34860,91.5,-
08-Aug-08,OCTAV,Octav Investments Limited,MLB CAPITAL PVT LTD,SELL,35800,90.37,-
08-Aug-08,OCTAV,Octav Investments Limited,MOHANACHANDRA BABU M [TV] [PT],SELL,21885,90.84,-
08-Aug-08,OCTAV,Octav Investments Limited,NEERAJ NISHCHAL,SELL,29427,91.25,-
08-Aug-08,OCTAV,Octav Investments Limited,NIKUNJ K SHAH,SELL,20024,103.07,-
08-Aug-08,OCTAV,Octav Investments Limited,OPG SECURITIES PVT. LTD.,SELL,15724,93.76,-
08-Aug-08,OCTAV,Octav Investments Limited,PRINCIPAL TRUSTEE COMPANY PVT. LTD. A/C PRINCIPAL,SELL,19029,126.61,-
08-Aug-08,OCTAV,Octav Investments Limited,R.M. SHARE TRADING PVT LTD,SELL,25802,105.29,-
08-Aug-08,OCTAV,Octav Investments Limited,SANTOSH KUMAR AGARWAL,SELL,25952,95.49,-
08-Aug-08,OCTAV,Octav Investments Limited,SATYA FINANCIAL SERVICES PROP ADARSH KUMAR AGGARWAL,SELL,18778,90.28,-
08-Aug-08,OCTAV,Octav Investments Limited,SATYA NARAYAN,SELL,19137,95.06,-
08-Aug-08,OCTAV,Octav Investments Limited,SBI MF A/C MTGS93-18,SELL,19385,95.51,-
08-Aug-08,OCTAV,Octav Investments Limited,SHIVAKUMARA M,SELL,16725,89.2,-
08-Aug-08,OCTAV,Octav Investments Limited,SMC GLOBAL SECURITIES LTD.,SELL,78447,93.25,-
08-Aug-08,OCTAV,Octav Investments Limited,TATA DIVIDEND YIELD FUND,SELL,46413,93.7,-
08-Aug-08,OCTAV,Octav Investments Limited,TATA TD WATERHOUSE TRUSTEE CO. PVT. LTD.,SELL,80181,109.44,-
08-Aug-08,OCTAV,Octav Investments Limited,THATTAMPARAMBIL KUNJU VIJAYAN,SELL,28149,91.79,-
08-Aug-08,OCTAV,Octav Investments Limited,TRANSGLOBAL SECURITIES LTD.,SELL,85549,96.21,-
08-Aug-08,OCTAV,Octav Investments Limited,U.T.I. -MF,SELL,33146,91.02,-
08-Aug-08,OCTAV,Octav Investments Limited,VIJAY KUMAR TRIPATHI,SELL,16747,91.05,-
08-Aug-08,OCTAV,Octav Investments Limited,VIMALA.S.,SELL,25337,88.28,-
08-Aug-08,OCTAV,Octav Investments Limited,YUVAK SHARE TRADING PVT LTD,SELL,22117,104.39,-
08-Aug-08,RUCHISOYA,Ruchi Soya Inds Ltd.,CITIGROUP GLOBAL MARKETS MAURITIUS PVT LTD,SELL,1902456,80,-
08-Aug-08,SELMCL,SEL Manufacturing Company,B K SHAH CO KETAN BHAILAL SHAH,SELL,167201,578.27,-
08-Aug-08,SELMCL,SEL Manufacturing Company,DKG SECURITIES PVT LTD.,SELL,138324,565.57,-
08-Aug-08,SELMCL,SEL Manufacturing Company,DKG SECURITIES PVT. LTD.,SELL,136132,558.22,-
08-Aug-08,SELMCL,SEL Manufacturing Company,MAVI INVESTMENT FUND,SELL,425000,571.58,-
BSE Bulk Deals to Watch - Aug 8 2008
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
8/8/2008 531223 ANJANI SYNTH AYODHYAPATI INVESTMENT PVT LTD B 78670 43.96
8/8/2008 531223 ANJANI SYNTH NARENDRA V. BAHUBA B 85147 45.09
8/8/2008 531223 ANJANI SYNTH AYODHYAPATI INVESTMENT PVT LTD S 145767 44.55
8/8/2008 531223 ANJANI SYNTH NARENDRA V . BAHUBA S 92722 44.48
8/8/2008 503940 ASIAN ELECT YUVAK SHARE TRADING PVT LTD B 162871 100.50
8/8/2008 503940 ASIAN ELECT YUVAK SHARE TRADING PVT LTD S 149998 99.45
8/8/2008 530355 ASIAN OILFIE DECENT FINANCIAL SERVICES PVT LTD B 250000 150.00
8/8/2008 530355 ASIAN OILFIE VSB INVESTMENTS B 250000 149.99
8/8/2008 530355 ASIAN OILFIE CONSOLIDATED SECURITES LTD S 500000 149.96
8/8/2008 590059 BIHAR TUBES SAROJINI FINANCE AND INVESTMENT P LTD B 100000 163.18
8/8/2008 531682 CAT TECHNOL BASMATI SECURITIES PVT LTD B 236011 7.07
8/8/2008 531682 CAT TECHNOL PRABHUDAS LILLADHER PVT. LTD. B 204922 7.03
8/8/2008 531682 CAT TECHNOL S V ENTERPRISES B 537890 7.01
8/8/2008 531682 CAT TECHNOL PRABHUDAS LILLADHER PVT. LTD. S 204922 7.04
8/8/2008 531682 CAT TECHNOL S V ENTERPRISES S 551168 7.04
8/8/2008 532443 CERA SANITRY DOLPHIN ABASAN PVT LTD B 38700 130.00
8/8/2008 532443 CERA SANITRY DEUTSCHE INTERNATIONAL TRUST CORP MAURITIUS LTD AC MINIVET LTD S 85000 130.00
8/8/2008 532283 KASHYAP TEC AYODHYAPATI INVESTMENT PVT LTD B 2218333 1.41
8/8/2008 532283 KASHYAP TEC AYODHYAPATI INVETMENT PVT LTD S 2218333 1.42
8/8/2008 531602 KOFF BR PICT LAXMI CAP BROKING PVT LTD B 143481 21.83
8/8/2008 531602 KOFF BR PICT LAXMI CAP BROKING PVT LTD S 82153 21.48
8/8/2008 512559 KOHINORFOODS PR VYAPAAR PRIVATE LIMITED S 172626 118.00
8/8/2008 530273 LIBERTY PHOS BHARAT EQUITY SERVICES LTD S 43707 20.52
8/8/2008 532906 MAN ALUMIN THE BANK OF NEWYORK GDR S 25848 34.54
8/8/2008 502157 MANGALAM CEM LG INDIA FUND LIMITED S 149504 98.50
8/8/2008 533010 OCTAV INVES MATRIX EQUITRADE PVT TLD B 82914 106.77
8/8/2008 533010 OCTAV INVES OPG SECURITIES PVT LTD B 175310 100.60
8/8/2008 533010 OCTAV INVES MANSUKH STOCK BROKERS LTD B 17640 89.03
8/8/2008 533010 OCTAV INVES MANSUKH SECURITIES AND FINANCE LTD B 28930 89.98
8/8/2008 533010 OCTAV INVES SAM GLOBAL SECURITIES LTD B 85693 91.69
8/8/2008 533010 OCTAV INVES B K SHAH CO B 96189 102.68
8/8/2008 533010 OCTAV INVES MEENAL NITISH THAKUR B 87540 94.90
8/8/2008 533010 OCTAV INVES MATRIX EQUITRADE PVT TLD S 82914 107.98
8/8/2008 533010 OCTAV INVES OPG SECURITIES PVT LTD S 175310 98.19
8/8/2008 533010 OCTAV INVES MANSUKH SECURITIES AND FINANCE LTD S 27987 89.73
8/8/2008 533010 OCTAV INVES SAM GLOBAL SECURITIES LTD S 85193 92.57
8/8/2008 533010 OCTAV INVES B K SHAH CO S 92634 104.56
8/8/2008 533010 OCTAV INVES PRINCIPAL TRUSTEE COMPANY PVT LTD S 27790 119.79
8/8/2008 533010 OCTAV INVES MEENAL NITISH THAKUR S 87540 94.90
8/8/2008 533010 OCTAV INVES SBI MUTUAL FUND GIFTS PLAN B S 19743 96.92
8/8/2008 502587 RAMA PUL PAP KARAN HADVANI B 75000 21.05
8/8/2008 502587 RAMA PUL PAP DIVYA STOCK BROKING LTD B 40000 21.89
8/8/2008 502587 RAMA PUL PAP KARAN HADVANI S 75000 21.90
8/8/2008 532884 REFEX REFRIG TUSHAR RAMESHBHAI PATEL B 80000 292.37
8/8/2008 532886 SEL MANUF HARDIK M MITHANI B 113868 618.34
8/8/2008 532886 SEL MANUF OPG SECURITIES PVT LTD B 194983 581.87
8/8/2008 532886 SEL MANUF SPJSTOCK B 254349 575.58
8/8/2008 532886 SEL MANUF B K SHAH CO B 152705 576.93
8/8/2008 532886 SEL MANUF HARDIK M MITHANI S 113868 615.42
8/8/2008 532886 SEL MANUF OPG SECURITIES PVT LTD S 194983 582.22
8/8/2008 532886 SEL MANUF SPJSTOCK S 249349 580.00
8/8/2008 532886 SEL MANUF B K SHAH CO S 153019 576.67
8/8/2008 500389 SILVERLINE T SHALANI DHOOP PVT LTD B 277516 18.91
8/8/2008 500389 SILVERLINE T BSMA LTD S 300000 18.90
8/8/2008 500389 SILVERLINE T SHALANI DHOOP PVT LTD S 336836 18.96
8/8/2008 521161 SRI LAKS SAR ANKIT BHUPENDRABHAI MEHTA S 19900 17.05
8/8/2008 513530 STELCO STRIP INDEX SECURITIES AND RESEARCH PV B 85835 19.50
8/8/2008 530585 SWASTIK INV GIRIRAJ KHANDELWAL B 17548 23.44
8/8/2008 512167 YASHRAJ SECR RAJESH C R NAIR B 200000 8.15
8/8/2008 512167 YASHRAJ SECR DILIP K. PAGARE S 200000 8.16
Nifty August 2008 futures at premium
L&T August 2008 futures at slight premium
Nifty August 2008 futures were at 4549, at a premium of 19.50 points as compared to spot closing of 4529.50. NSE's futures & options (F&O) segment turnover was Rs 47,120.45 crore, which was lower than Rs 49,917.63 crore on Thursday, 7 August 2008.
Shree Renuka Sugars August 2008 futures were at premium at 133.40 compared to the spot closing of 132.50.
Larsen & Toubro August 2008 futures were at premium at 2840 compared to the spot closing of 2836.35.
Chambal Fertilizers & Chemicals August 2008 futures were at premium at 82.40 compared to the spot closing of 81.55.
In the cash market, the S&P CNX Nifty gained 5.65 points or 0.12% at 4529.50.
Industrial production data may set direction
The market will take cues from June 2008 industrial production figures which the government will release on Tuesday, 12 August 2008. Falling crude oil prices and improvement in south west monsoon will provide some relief to investors. Rising inflation remains a major worry for the markets in the medium term.
The government will release June 2008 industrial production data at 12:00 IST on 12 August 2008. Reserve Bank of India’s recipe to contain inflation by increasing the lending rates is expected to hurt industry, manufacturing sector and the overall growth momentum. Industrial production grew at the slowest pace in more than six years in May 2008, at 3.8%, as against 10.6% in the same month of 2007, with manufacturing showing signs of acute deceleration.
Inflation remains a major concern for the central bank. Inflation based on the wholesale price index rose 12.01% in 12 months to 26 July 2008, slightly above the previous week's annual rise of 11.98%, government data released on 7 August 2008 showed.
Reserve Bank of India (RBI) on 29 July 2008, raised repo rate by 50 basis points to a seven-year high of 9% to curb inflation and dampen inflationary expectations. RBI also raised the cash reserve ratio (CRR), the proportion of funds that banks must keep on deposit with it, by 25 basis points to 9%. The central bank left its reverse repo and bank rates unchanged. Responding to the RBI's monetary tightening, top lenders HDFC and ICICI Bank and a number of state run bank have raised interest rates.
The aggregate results of 2,988 companies showed 5.1% rise in net profit to Rs 63,752 crore on 37% rise in sales to Rs 7,64,023 crore in Q1 June 2008 over Q1 June 2007. The net profit growth is now in single digits the lowest in the past 20 quarters. In the June 2008 quarter, a number of companies were hit by mark-to-market (MTM) losses on their foreign exchange (forex) exposure.
Crude oil prices have declined sharply from record high $147.27 a barrel hit on 11 July 2008. Oil held near $118 a barrel on Friday 8 August 2008. India imports 70% of its crude requirement. The rising crude oil prices affects the fiscal deficit position of the country and its sovereign rating.
India's monsoon, was above average for the first week in August 2008, helping ease a dry spell that had threatened to delay sowing of crops including rice and cotton. Farmers in India, the world's second-largest rice producer, rely on the timing of the monsoon to decide which crops to grow. Showers in July 2008, the wettest month in the June-September season, were 18% below average, undermining prospects for record grain output critical to lowering food inflation.
Marketmen will keenly watch the development of India’s nuclear deal with US. The Board of Governor of the International Atomic Energy Agency (IAEA) on 1 August 2008 unanimously adopted the India-specific safeguards agreement, a key step in operationalisation of the Indo-US nuclear deal.
With the go-ahead from IAEA, India will now seek a waiver from 45 nuclear supplier nations allowing trade with a non-NPT (Non-Proliferation Treaty) country and then ratification from the US Congress, to finalise the deal. Most big powers have backed the deal.
Foreign institutional investors (FII)’s bought shares worth Rs 1,527.90 in the first few days of August 2008 (till 7 August 2008). FIIs sold shares worth Rs 25,774.20 in the calendar year 2008, till 7 August 2008. Mutual funds sold shares worth Rs 286.10 in the month of August 2008 (till 7 August 2008).
Sensex garners 511 points as oil slumps
Fall in crude oil prices to 3-month low, recovery in rainfall and buying by foreign institutional investors helped Sensex close above crucial 15,000 mark. The barometer index rose in all the five trading sessions in the week ended Friday, 8 August 2008.
Sensex rose 511.13 points or 3.49% to 15,167.82 in the week ended 8 August 2008. The CNX S&P Nifty rose 115.95 points or 2.62% to 4,529.50.
The BSE Mid-Cap index rose 244.23 points or 4.33% to 5,886.97 and the BSE Small-Cap index rose 201.64 points or 2.89% to 7,181.74.
BSE Bankex (up 9.9% to 7,395.03), BSE Auto index (up 8.58% to 3,970.20), BSE Realty index (up 5.96% to 5,508.88), BSE Capital Goods index (up 3.58% to 12,565.88), BSE Power index (up 1.48% to 2,701.10), BSE IT index (up 2.26% to 3,885.86) edged higher in the week.
Foreign institutional investors (FII)’s bought shares worth Rs 1527.90 in the first few days of August 2008 (till 7 August 2008). FIIs sold shares worth Rs 25774.20 in the calendar year 2008, till 7 August 2008. Mutual funds sold shares worth Rs 286.10 in the month of August 2008 (till 7 August 2008).
Crude oil prices declined sharply from a record high $147.27 a barrel hit on 11 July 2008. Oil held near $118 a barrel on Friday 8 August 2008. India imports 70% of its crude requirement. The rising crude oil prices affects the fiscal deficit position of the country and its sovereign rating.
The key benchmark indices settled lower on Monday, 4 August 2008, after swinging wildly throughout the day. Global cues were mixed with negative bias. However buying momentum in small-cap and mid-cap stocks kept the market breadth strong. Selling pressure was seen in capital goods, banking and power stocks.
The BSE 30-share Sensex advanced 383.20 points or 2.63% to 14,961.07 on Tuesday, 5 August 2008. A fall in US crude oil prices to 3-month low and firm European markets triggered a solid rally on the bourses.
Stocks ended volatile session slightly higher on Wednesday, 6 August 2008, extending gains for the second straight day. Strong global cues triggered a solid rally in first half of the day’s trading session. However profit booking at higher levels in second half capped gains. Sensex rose 112.47 points or 0.75% to 15,073.54. The US Federal Reserve at a meeting held after Indian market hours on 5 August 2008, held key interest rate at unchanged 2%.
The BSE 30-share Sensex rose 43.71 points or 0.29% at 15,117.25 on Thursday, 7 August 2008. The key benchmark indices ended with marginal gains ahead of the inflation data.
Key benchmark indices staged a strong intra-day rebound in late on Friday, 8 August 2008, boosted by fall in crude oil prices and higher US stock futures. Banking and auto shares recovered sharply from early lows. Volatility was high throughout the day. The BSE 30 Sensex rose 50.57 points or 0.33% to 15,167.82.
India’s largest electric equipment maker Bharat Heavy Electricals rose 1.52% to Rs 1,783.25 in the week. Reports on 7 August 2008 said government has blamed the company for delaying projects causing acute shortage of electricity in various parts of the country. On 6 August 2008 the company won first ever contract for supplying 800 mega watts supercritical boilers.
India’s largest home loan lender by operating income Housing Development Finance Corporation 4.63% to Rs 2,513.35 . Reports on 7 August 2008 said the company is in talks with GE Money to buy the latter's Indian home loan business.
India’s largest state run oil exploration firm Oil & Natural Gas Corporation gained 6.74% to Rs 1,064. Reports on 6 August 2008 said the company plans to scale up its gas production in Tripura and has revised the project cost to Rs 4376 crore from Rs 1817 crore.
HDFC Bank (up 15.61% to Rs 1,280.20), ICICI Bank (up 13.52% to Rs 728.90), State Bank of India (up 1.44% to Rs 1,521.85), Larsen & Toubro (up 5.26% to Rs 2,834.05), Reliance Industries (down 2.14% to Rs 2,250.45), Satyam Computer Services (up 4.56% to Rs 409), Tata Consultancy Services (up 0.39% to Rs 842.55), Wipro (up 1.18% to Rs 437.70), Reliance Communications (up 0.38% to Rs 438.45) and Infosys (up 2.42% to Rs 1,679.85) edged higher from the Sensex pack.
Government’s direct tax collections rose an annual 46.9% to Rs 71648 crore in April-July 2008, the finance ministry said in a statement on 6 August 2008.
Inflation based on the wholesale price index rose 12.01% in 12 months to 26 July 2008, slightly above the previous week's annual rise of 11.98%, government data released on 7 August 2008 showed. Inflation for the week ended 31 May 2008 was revised upwards to 9.32% from 8.75%.
Science and Technology Minister Kapil Sibal on 8 August 2008, said the June-September monsoon rains have revived across the country and are expected to be normal. Sibal said the union cabinet has approved a new investment policy for the urea sector, linking cost of production to the import parity price, a key demand of the industry. The minister also said the cabinet has approved a new policy on uranium exploration.
India's monsoon was above average for the first week in August 2008, helping ease a dry spell that had threatened to delay sowing of crops including rice and cotton. Farmers in India, the world's second-largest rice producer, rely on the timing of the monsoon to decide which crops to grow. Showers in July 2008, the wettest month in the June-September season, were 18% below average, undermining prospects for record grain output critical to lowering food inflation.
Responding to the RBI's monetary tightening, top lenders HDFC and ICICI Bank and a number of state-run bank have raised interest rates.
Market ends higher in choppy trade
Key benchmark indices staged a late comeback after struggling in the red for a major part of the day, boosted by fall in crude oil prices and higher US stock futures. Banking and auto shares recovered sharply from early lows. Volatility was high throughout the day. The barometer index BSE Sensex saw wild swings above and below the 15,000 mark. The market breadth was negative. European shares edged higher while Asian markets were trading mixed.
US stock futures hinted higher opening on Wall Street. The Dow Jones futures are up 0.3% while Nasdaq futures are up 0.4%. US light crude slumped $2.06 to $117.96 a barrel today, 8 August 2008, as supply concerns eased after an indication that a key oil pipeline through Turkey, still burning after an explosion, may come back on line earlier than some previous expectations.
India's inflation, represented by the wholesale price index (WPI), rose 12.01% in the year to 26 July 2008, slightly above the previous week’s 11.98% rise. The reading was the highest in the last 13 years. The figure was released after market hours yesterday, 7 August 2008.
Science and Technology Minister Kapil Sibal today, 8 August 2008, said the June-September monsoon rains have revived across the country and are expected to be normal.
The BSE 30-share Sensex was up 50.57 points or 0.33% at 15,167.82. It opened 80.68 points lower at 15,036.57 and slipped further to hit an intra-day low of 14,888.12 in early afternoon trade. At the day’s low, the Sensex lost 229.13 points. At the day’s high of 15,228.82 struck in mid-afternoon trade, the Sensex 111.57 gained points.
The S&P CNX Nifty was up 5.65 points or 0.12% at 4529.50. Nifty August 2008 futures were at 4549, at a premium of 19.50 points as compared to spot closing.
As per provisional data released by the stock exchanges after trading hours, foreign funds today, 8 August 2008, sold shares worth a net Rs 142.22 crore. Domestic funds bought shares worth a net Rs 16.29 crore.
The BSE Sensex is down 5,119.17 points or 25.23% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 6038.95 points or 28.47% away from its all-time high of 21,206.77 struck on 10 January 2008.
Sentiment may remain cautious in the forthcoming week, as the market regulator Securities & Exchange Board of India (Sebi) meets on 13 August 2008 to review the rules relating to issuance of Participatory Notes (PNs) by foreign portfolio investors, which it had revised in October 2007. A review of securities lending & borrowing mechanism, know your client (KYC) norms for FIIs and status on launch of currency futures are likely to be discussed in the meeting.
The market breadth was negative on BSE with 1409 shares declining as compared to 1306 that advanced. 67 remained unchanged.
The BSE Mid-Cap index was up 0.09% to 5,886.97 and the BSE Small-Cap index was up 0.21% to 7,181.74.
The total turnover on BSE amounted to Rs 5375 crore as compared to Rs 5691 crore yesterday, 7 August 2008. NSE’s futures & options turnover amounted to Rs 47,120.45 crore as compared to Rs 49,917.63 crore yesterday, 7 August 2008.
Among the 30-member Sensex pack, 17 declined while the rest advanced.
Banking and auto shares rebounded sharply from early lows. ICICI Bank (up 2.80% to Rs 728.35, off day’s low of Rs 683.10), and HDFC Bank (up 1.54% to Rs 1273, off day’s low of Rs 1225), advanced.
India’s largest state-run bank in terms of net profit State Bank of India fell marginally by 0.07% to Rs 1523. The stock came sharply off the day’s low of Rs 1477.40.
Fall in crude oil prices fuelled rally in auto stocks from day’s low. India's top truck maker by sales, Tata Motors recovered from day's low of Rs 427. It ended 0.21% lower at Rs 443.25. Mahindra & Mahindra, the nation's top tractor maker by sales ended 0.68% lower at Rs 572.05 after hitting day's low of Rs 551.10.
India’s top small car maker by sales Maruti Suzuki India rose 1.26% to Rs 677, after sliding to day’s day’s low of Rs 655.05.
Oil and Natural Gas Corporation (ONGC), the country’s largest oil exploration company by market capitalisation surged 4.21% to Rs 1066.20. It was the top gainer from the Sensex pack. The company reportedly plans to scale up its gas production in Tripura and has revised the project cost to Rs 4376 crore from Rs 1817 crore.
India’s third largest pharma company by sales, Cipla advanced 3.19% to Rs 234.70. As per reports the hearing in the Delhi High Court between Cipla and Swiss drug maker Roche has been adjourned to 11 August 2008. Roche had dragged Cipla to court due to patent infringement of Roche’s HIV/AIDS drug Valcyte by Cipla.
Capital goods heavyweights, Larsen & Toubro (up 3.02% to Rs 2841.05), and Bharat Heavy Electricals (up 0.30% to Rs 1780), gained.
India's largest private sector steelmaker by sales, Tata Steel gained 1.16% to Rs 650.25 after three straight days of fall. Top steel producers have decided not to raise steel prices even as the three month moratorium with the government on price freeze ended on 7 August 2008
Hindalco (up 2.04% to Rs 144.90), HDFC (up 1.35% to Rs 2510), and NTPC (up 0.60% to Rs 184.55), edged higher from Sensex pack.
India's largest private sector firm by market capitalization and oil refiner Reliance Industries (RIL) was down 1.29% at Rs 2242 on 9.34 lakh shares. The stock recovered from day’s low of Rs 2230. Reliance Natural Resources (RNRL) gained 3.82% to Rs 104.75.
As per reports, the Bombay High Court (HC) has once again postponed hearing on the RIL-RNRL case till 12 August 2008. The court will decide in its next hearing whether the government can intervene in this case at this stage. The government had filed a petition in the HC to become a party to the case, supporting RIL.
Cement counters slipped on selling pressure. North India’s largest cement producer Ambuja Cements lost 3.66% to Rs 86.85 on 4.77 lakh shares. It was the top loser from the Sensex pack.
Other cement counters, Grasim (down 2.65% to Rs 2034), and ACC (down 1.89% to Rs 627), declined.
India’s largest cigarette maker in terms of sales ITC was down 0.63% to Rs 190.50 on reports the company may hike prices of some of its premium brands by end-August 2008.
Frontline telecom shares slipped. Bharti Airtel, the nation’s top mobile operator by revenue lost 1.18% to Rs 840.15. The company yesterday, 6 August 2008, said it would launch Apple Inc's third-generation iPhone in India on 22 August 2008.
India’s number two cellular services provider in terms of market capitalisation Reliance Communications (RCom) was down 0.07% to Rs 438.25. According to recent reports, the company is all set to float a $500-million tender for GSM 3G networks. At present, RCom is predominantly a CDMA-based operator which is now looking at 3G services only in the GSM space.
IT pivotals were under selling pressure. Wipro (down 2.68% to Rs 436.50), TCS (down 1.10% to Rs 842.05), Satyam Computer Services (down 2.03% to Rs 408.10), and Infosys (down 2.78% to Rs 1673.55), edged lower.
Interest rate sensitive realty shares declined. DLF (down 0.91% to Rs 549.80), Parsvnath Developers (down 1.49% to Rs 126.50), Unitech (down 1.39% to Rs 176.90), fell from the realty space.
Ranbaxy (down 0.14% to Rs 503.25), and Jaiprakash Associates (down 2% to Rs 183.65), and edged lower from the Sensex pack.
Reliance Capital topped turnover charts on BSE notching turnover of Rs 346.35 crore followed by Reliance Natural Resources (Rs 293.50 crore), Reliance Industries (Rs 211 crore), ICICI Bank (Rs 193.80 crore) and Larsen & Toubro (Rs 178.40 crore), in that order.
Reliance Natural Resources was the volume topper clocking volumes of 2.90 crore shares followed by Chambal Fertilisers & Chemicals (1.62 crore shares), Nagarjuna Fertilisers (1.35 crore shares), Ispat Industries (1.05 crore shares) and IFCI (88.70 lakh shares), in that order.
Fertilizer shares edged higher on reports the government approved the investment policy for urea, linking cost of production to the import parity price, a key demand of the industry.
National Fertilizer (up 5% at Rs 60.45), Rastriya Chemical & Fertilizer (up 2.08% at Rs 68.70), Nagarjuna Fertilizers & Chemicals (up 3.22% at Rs 41.65), Chambal Fertilizers & Chemicals (up 2.65% at Rs 81.50), and Tata Chemicals (up 7.46% at Rs 350), spurted.
Among side counters, Noida Toll Bridge (up 14.40% to Rs 42.90), Zuari Industries (up 20% to Rs 327.70), and MRO Teck (up 20% to Rs 61), surged.
Josts Engineering (down 11.40% to Rs 264.90), Hester Pharma (down 10.26% to Rs 105), and Man Aluminium (down 9.88% to Rs 34.20), slipped.
Shares of state-run oil marketing companies slipped. Hindustan Petroleum Corporation (down 3.5% to Rs 229.60), Bharat Petroleum Corporation (down 3.25% to Rs 318.30), and Indian Oil Corporation (down 2.32% to Rs 432.50), slipped.
Financial Technologies (India) jumped 2.53% to Rs 1405 on reports its subsidiary, the Multi Commodity Exchange, has sought regulatory nod for trading in currency futures. Financial Technologies holds 32% in the Multi Commodity Exchange (MCX).
SEL Manufacturing Company plunged 20% to Rs 500.90 even as the company received an export order for supplying 1.1 million pieces of readymade garments to a Russian customer. The company made this announcement during trading hours today, 8 August 2008.
Cairn India slipped 5.31% to Rs 232.50 on reports the government could impose a special tax on oil firms' incremental revenues beyond $75 per barrel as part of the subsidy-sharing regime of the oil sector.
Shanthi Gears surged 9.27% to Rs 73.65 on reports Suzlon Energy, through its Belgium-based unit, is planning to buy 50% and 100% stake in Shanthi Gears at around a 30% premium to the market price.
Housing Development & Infrastructure rose 2.84% to Rs 495.40 after the Reserve Bank of India on Thursday, 7 August 2008, raised foreign institutional investors limit in the company to 100%.
European markets, which opened after Indian market, edged higher. Key benchmark indices in France, UK and Germany were up by between 0.13% and 0.58%.
Asian markets were trading mixed today, 8 August 2008. Key benchmark indices in Taiwan, Japan, and South Korea were up by between 0.30% and 2.63%. However indices in China, Hong Kong and Singapore were down 0.69% and 4.47% respectively.
US stocks declined yesterday, 7 August 2008, after American International Group (AIG) posted its third consecutive quarterly loss of more than $5 billion, which fueled fears of more fallout from the credit crisis. Wal-Mart's cautious sales forecast added to concerns about consumer spending.
The Dow Jones Industrial Average slumped 224.64 points, or 1.93% to 11,431.43, the Standard & Poor's 500 index fell 23.11 points, or 1.79% to 1,266.08, while the Nasdaq Composite index dropped 22.64 points, or 0.95% to 2,355.73.
The European Central Bank and the Bank of England both left their benchmark interest rates unchanged at 4.25% and 5% respectively in a meeting yesterday, 7 August 2008, as they ponder how best to steer their economies between the shoals of mounting inflation and slowing growth.
Daily Call - Aug 8 2008
The US is in a soup, as the woes of AIG reveal and as Citi and Merrill agree to accept $17 billion charges to buy peace with regulators. There is trouble brewing next door with impeachment coming up next week for Mian Musharraf. The NSG clearance is still not in the bag and Crude is rising again after a reported fire in an Eurasian pipeline. And not to forget that Olympics get under way in China.
It might be a good idea to stay on the sidelines for another day and come back and review the matter on Monday. Though the news may be gloomy this morning, but not everything is lost. The SEBI will meet next week to revisit the PN curbs it put into place, among other agenda. Expect the PNs flows to be eased, which could be a real big trigger for the markets. The market could hang its hopes on this one. Don’t carry large positions over the weekend, unless you are doing through options.
Grey Market Premium - Aug 2008
Vishal Information Technologies 140 to 150 3 to 5
NU TEK India Ltd. 170 to 192 5 to 7
Austral Coke & Projects 164 to 196 3 to 5
Resurgere Mines & Minerals 263 to 272 17 to 20
Pre Session Commentary - Aug 8 2008
The Indian Market is expected to have negative opening on weak global cues as US markets closed with losses and Asian markets are trading mixed along with rise in crude oil prices. On Thursday, the Indian market closed with marginal gains after showing volatility during the trading session. The domestic market opened marginally lower tracking negative cues from the Asian markets. Further, it showed some recovery but lost the momentum and turned volatile to close with minor gains ahead of inflation worries. NSE Nifty ended above 4,500 mark and BSE Sensex ended above 15,100 level. From the sectoral front, Consumer Durables and Auto stocks overtake the market followed by Bank, IT and Reality stocks as witnessed significant buying from these baskets. However, only Capital Goods, Oil & Gas and Power stocks were sufferers of investor’s negative attitude. The BSE Sensex closed higher by 43.71 points at 15,117.25 and NSE Nifty ended marginally up by 6.30 points at 4,523.85. We expect that market may remain volatile during the trading session.
India''s annual inflation increased to more than 12% for the first time in over 13 years, which added fuel to expectations of further monetary tightening to tame prices. Inflation edged higher to 12.01% for the week ended 26th July 2008, up from 11.98% for the previous. This increase is due to the prices of pulses, spices, eggs, fish and meat among other things continued to rise.
The Bank of England kept unchanged the British interest rates at 5.0% for the fourth month in a row. Along with this the European Central Bank that left its benchmark interest rate unchanged at 4.25% on Thursday while acknowledged that the economy was struggling because of high energy prices and slower growth.
Czech Republic''s central bank unexpectedly cut its benchmark interest rate by 25 basis points to 3.5%. Most analysts had expected the central bank to keep rates unchanged. This is in response to easing inflationary pressures and an attempt to prevent further appreciation of the Czech koruna and is the first reduction for more than three years.
On Thursday, the US market was closed in deep red due to a rise in unemployment and poor retail figures. The number of first time claims filed in the week ending 2nd August 2008, rose by 7,000 to 455,000, the highest level since March 2002. Along with this results from US retailers including Wal-Mart have shown disappointing sales for July. Increase in crude oil price above $120 a barrel also added to the negative sentiment. Light, sweet crude for September delivery rose $1.56 to settle at $120.02 a barrel on the New York Mercantile Exchange.
The Dow Jones Industrial Average (DJIA) closed lower by 224.64 points at 11,431.43 along with S&P 500 index closed down by 23.12 points at 1,266.07 and NASDAQ closed at 2,355.73 down by 22.64 points.
Indian ADRs ended mixed. In technology sector, Patni Computers ended higher by (0.72%) along with Satyam by (0.13%) while Wipro dropped by (2.80%) followed by Infosys by (0.2.36%). In banking sector, ICICI bank and HDFC bank lost (4.12%) and (1.70%) respectively. In telecommunication sector, Tata Communication and MTNL ended up by (2.73%) and (0.78%). Sterlite industries increased by (3.10%).
Today the major stock markets in Asia are trading mixed. Taiwan Weighted is trading higher by 106.04 points at 7,130.62 along with Hang Seng index trading up by 7.95 points at 22,112.15 while Japan’s Nikkei is trading down by 74.03 points at 13,050.96 and Singapore''s Straits Times lost 17.81 points at 2,816.90.
The FIIs on Thursday stood as net buyer in both equity and debt. The gross equity purchased was Rs4,921.90 Crore and the gross debt purchased was Rs104.40 Crore while the gross equity sold stood at Rs3,293.30 Crore and gross debt sold stood at Rs91.90 Crore. Therefore, the net investment of equity reported was Rs1,628.60 Crore and net debt was Rs12.50 Crore.
The Indian rupee ended steady on Thursday. The partially convertible rupee ended at 42.075/080 per dollar, off a high of 41.87 and little changed from its previous close of 42.08/09.
Today, Nifty has support at 4,422 and resistance at 4,593 and BSE Sensex has support at 14,737 and resistance at 15,401.
Weak Asian indices indicate a negative open
Correction in overseas markets likely to keep the sentiment bearish. Major factors like FIIs continuing offloading in equities my also add pressure. Among the key indices, the Nifty may decline to 4480 while on the upside the index faces resistance in the 4550-4600 range. The Sensex has a likely support at 14900 and could test higher levels of 15300.
US indices tumbled on Thursday, with the Dow Jones declined 225 points at 11431, the Nasdaq dropped 23 points to close at 2356 on weakness in tech stocks.
Indian floats largely ended on a weak note. ICICI Bank dropped 4.12% while Infosys, Wipro and Rediff were down nearly 2% each. Tata Motors and HDFC Bank, Wipro also faltered while VSNL, Dr Reddy, MTNL, Patni Computer and Satyam registered steady gains.
Crude oil prices moved up, with the Nymex light crude oil for September delivery gaining by $1.44 at $120.02 a barrel. In the commodity segment, the Comex gold for December series remained at $877.90 down $5.10 a troy ounce.
Weak global cues may trigger lower opening
Key benchmark indices are likely to see lower opening tracking negative global cues. Also rise in crude oil prices from 3-month low and inflation topping the 12% mark may weigh on the sentiment.
Inflation, represented by the wholesale price index (WPI), rose 12.01% in the year-to-26 July 2008, slightly above the previous week’s 11.98%. It's the highest inflation in the last 13 years. The figures were released after market hours yesterday, 7 August 2008.
The Reserve Bank of India (RBI) is likely to continue with its tight monetary stance to counter the surge in headline inflation rate, C Rangarajan, chairman, Prime Minister’s Economic Advisory Council, said yesterday, 7 August 2008. He added that the inflation rate is likely to moderate to 8-9% by March 2009, which is still way higher than the central bank’s revised forecast of close to 7% for the current fiscal.
On the New York Mercantile Exchange, September crude gained $1.44 at $120.02 a barrel yesterday, 7 August 2008, as pipeline shutdown in Turkey due to an explosion raised supply worries.
Meanwhile, the European Central Bank and the Bank of England both left their benchmark interest rates unchanged at 4.25% and 5% respectively in a meeting scheduled yesterday, 7 August 2008, as they ponder how best to steer their economies between the shoals of mounting inflation and slowing growth.
Asian markets were trading mixed today, 8 August 2008. China's Shanghai Composite lost 0.42% or 11.36 points at 2,716.21, Japan's Nikkei was down 0.56% or 74.03 points at 13,050.96, Singapore's Straits Times fell 0.63% or 17.81 points at 2,816.90. However, Hong Kong's Hang Seng was up 0.04% or 7.95 points at 22,112.15, Taiwan's Taiwan Weighted gained 1.51% or 106.04 points at 7,130.62 and South Korea's Seoul Composite rose 0.41% or 6.35 points at 1,570.35
US stocks declined yesterday, 7 August 2008, after American International Group (AIG) posted its third consecutive quarterly loss of more than $5 billion, which fueled fears of more fallout from the credit crisis. Wal-Mart's cautious sales forecast added to concerns about consumer spending.
The Dow Jones Industrial Average slumped 224.64 points, or 1.93% to 11,431.43, the Standard & Poor's 500 index fell 23.11 points, or 1.79% to 1,266.08, while the Nasdaq Composite index dropped 22.64 points, or 0.95% to 2,355.73.
Back home, key benchmark indices finished with modest gains yesterday, 7 August 2008, after swinging sharply either ways. The BSE Sensex rose 43.71 points or 0.29% to 15,117.25 and the S&P CNX Nifty gained 6.3 points or 0.14% at 4523.85.
Foreign institutional investors (FIIs) were net equity sellers worth Rs 223.19 crore while mutual funds purchased shares worth Rs 24.10 crore yesterday, 7 August 2008, according to provisional data on NSE.
FIIs were net sellers of Rs 225.81 crore in the futures & options segment yesterday, 7 August 2008. They were net buyers of index futures to the tune of Rs 117.81 crore and sold index options worth Rs 69.66 crore. They were net sellers of stock futures to the tune of Rs 276.82 crore and bought stock options worth Rs 2.82 crore.
Morning Call - Aug 08 2008
Market Grape Wine :
In House :
Nifty at a support of 4475 and 4425 levels with resistance at 4580 and 4616 levels .
Buy : in Cash McDowell above 1355 target 1410 s/l of 1335
Buy : in Cash : CairnEnergy above 248 target 255 s/l of 243
Buy : in F&O : CenTextile above 530 s/l of 520 and target 550
Sell : in F&O RComm below 441 target of 425 s/l of 450
Out House:
Markets at a support of 14786 & 14654 levels with resistance at 15212 & 15351 levels .
Buy : Infy at dips
Buy : Bongaigaon at dips
Buy : Aptech at dips
Buy : Adalbs at dips
Buy : Titan
Buy : RelCap
Buy : Bhel & LNT at dips
Buy : IBreal
Buy : Core project at dips
Buy : IciciBank at dips
Dark Horse : ITC , RelCap , Titan , Aftek , RIL , LNT , Core & Adlabs
TGIF : Thank God Its Friday : Buy low sell high call for the day , book profits at higher levels . ITS 080808 Today once in life time .
Trading Calls - Aug 8 2008
Nifty (4524) Sup 4450 Res 4600
Buy GAIL (430) SL 425
Target 442,445
Buy Adlabs (550) SL 545
Target 560, 563
Buy Neyveli Lignite (122) SL 117 Target 128, 129
Sell Nalco (401) SL 407
Target 390, 387
Sell Rolta (302) SL 307
Target 292, 290
Volatility to persist
Challenge is a dragon with a gift in its mouth. Tame the dragon and the gift is yours.
Despite the rise in volatility off late, the bulls have managed to hold off the challenge from the bears. The Sensex is up over 3% over last Friday's levels while the Nifty has gained 2.5%. Both the indices breached major milestones during the week, but have since come off those highs. The Sensex crossed 15,400 but slipped under 15,000 briefly yesterday. The Nifty on the other hand crossed 4600 but went below 4500 in intra-day trade yesterday.
Things have also been volatile globally, with markets trying to break out of the protracted downturn, but unable to ignore the slew of headwinds. The trend is likely to remain choppy over the coming days in the absence of any major market moving events. The key indices are likely to be rangebound and will face resistance at higher levels, as they have rallied around 20% over the past few weeks. Uncertainty continues over the local macro-economic factors and global scenario.
The recent correction in crude oil is the only notable positive for the global markets and will continue to drive sentiment. Inflation and rising interest rates are the other key factors to watch out for. Having said that most of it has been discounted. We expect the market to be cautious at open as most global markets are down. Given the lack of big-ticket events, things will turn volatile later in the day.
FIIs were net sellers of Rs2.23bn (provisional) in the cash segment on Thursday and the local funds pumped in Rs241mn. In the F&O segment, the foreign funds were net sellers of Rs2.26bn.
On Wednesday, FIIs were net buyers of Rs16.29bn in the cash segment. Mutual funds were net sellers of Rs3.8bn.
Asian markets are trading mixed this morning. The Nikkei in Tokyo was down 74 points at 13,050 while the Hang Seng was up only 0.1% at 22,133. The Kospi in Seoul rose by 4 points to 1567 while the Straits Times in Singapore lost 13 points at 2821.
The Shanghai Composite index in China was down 1% at 2697 and the Taiex in Taiwan climbed 1.7% to 7142. The MSCI Asia Pacific Index declined 0.6% to 127.30 as of 10:27 a.m. in Tokyo. For the week, the gauge has lost 2.6%.
US stocks slumped on Thursday as investors considered reports showing higher borrowing costs, weaker spending, rising jobless claims and more bad news on the financial sector.
Financial stocks were hurt by AIG's multibillion-dollar loss and a legal settlement that could cost Citigroup up to $7bn. Investor sentiment was also hit as crude oil prices rose slightly and Wal-Mart announced disappointing sales.
The S &P 500 Index lost 23.12 points, or 1.8%, to 1,266.07, retreating from a six-week high. The Dow Jones Industrial Average dropped 224.64 points, or 1.9%, to 11,431.43. The Nasdaq Composite Index dived 22.64 points, or 1%, to 2,355.73.
Market breadth was negative. More than four stocks dropped for each that rose on the New York Stock Exchange.
A report released in the late afternoon showed that consumer borrowing costs increased in June at the fastest pace in seven months. The selloff seemed to pick up the pace after that.
The number of Americans filing new claims for unemployment last week rose by 7,000 to 455,000. That figure represents a more than 6-year high. meanwhile, the June pending home sales index showed sales rose 5.3% in the month versus forecasts for a drop of 1%.
AIG has posted a steeper-than-expected quarterly loss of $5.36bn due to massive writedowns related to the credit collapse. Shares of AIG fell by over 18%, dragging on the Dow.
Citigroup agreed to buy back over $7bn in auction-rate securities after the New York Attorney General said the company misled investors. Citi shares lost 6%.
Wal-Mart reported July sales at stores open a year or more rose 3%, short of analysts' expectation that sales would grow 3.4%. Wal-Mart shares fell over 6%. Other retailers also reported lackluster sales.
US light crude oil for September delivery rose $1.44 to settle at $120.02 a barrel on the New York Mercantile Exchange after ending the previous session at a three-month low. Oil prices have slipped nearly 20% since peaking above $147 in July.
In currency trading, the dollar was flat versus the euro and inched lower versus the yen. In the bond market, Treasury prices rallied, lowering the yield on the benchmark 10-year note to 3.92% from 4.05% late on Wednesday. COMEX gold for October delivery fell $5 to settle at $873.80 an ounce.
European equity markets ended marginally down with losses limited by oil producers, Barclays and insurance giant Axa. The pan-European Dow Jones Stoxx 600 index closed down 0.3% at 286.89. The French CAC-40 closed up 0.2% at 4,457.43, while the UK-based FTSE 100 was down 0.2% at 5,477.50 and Germany's DAX 30 dropped 0.3% to 6,543.49.
In the emerging markets, Brazil's Bovespa fell 0.9% to 57,015.55 while the IPC index in Mexico fell 1.3% to 26,986.98. The RTS index in Russia jumped 1.5% at 1842 and the ISE National 30 index in Turkey was down 1.25% to 51,270.
Markets extended gains to third straight trading session as Indian markets ended with modest gains. Despite all the choppiness, the Sensex and Nifty indices both managed to hold on to their crucial 15,000 and 4,500 levels. Finally, the benchmark Sensex gained 43 points to close at 15,117 and Nifty was added 6 points to close at 4,523.
Shares of ICICI Bank edged higher by half a percent to Rs708 after reports stated that the bank is discontinuing loans for two-wheelers offered at the dealer’s end from August 15.
This Model accounts for the bulk of two-wheeler business for ICICI Bank. This move would impact the two-wheeler business which is already witnessing a slowdown. Currently ICICI Bank disburses around Rs1.8bn of two-wheeler loans every month added reports. The scrip touched an intra-day high of Rs720 and a low of Rs690 and recorded volumes of over 18,00,000 shares on BSE.
Shares of Hindustan Zinc slipped by 1% to Rs582. The company announced that it cut Zinc prices by Rs3,500 per ton and cut Lead prices by Rs6,000 per ton. The scrip touched an intra-day high of Rs599 and a low of Rs577 and recorded volumes of over 22,000 shares on BSE.
Shares of Shiv-Vani-Oil surged by over 5% to Rs575 after media reports stated that the company secured orders worth Rs16.10bn from ONGC for 8 rigs. The scrip touched an intra-day high of Rs608 and a low of Rs536 and recorded volumes of over 2,00,000 shares on BSE.
Corporation Bank marginally slipped by 0.2% to Rs275. The company announced that in order to cope with the impact of increase in the cost of funds, Corporation Bank Benchmark Advance Rate (COBAR) has been revised upward by 50bps from the present level of 13.50% p.a. to 14% p.a. with effect from August 11, 2008. The scrip touched an intra-day high of Rs279 and a low of Rs271 and recorded volumes of over 6,000 shares on BSE.
BHEL slipped down by 3% to Rs1774. According to reports, the company may win orders valued at Rs37bn. The company may win Rs22bn contract from Maharashtra State Power Generation Co. to equip a 1,000 megawatts power plant and a contract worth about Rs15bn from GVK Industries Ltd. for a 540 megawatt plant, reports added.
The scrip touched an intra-day high of Rs1830 and a low of Rs1760 and recorded volumes of over 4,00,000 shares on BSE.
Aksh Optifibre surged by over 2.5% to Rs43 after the company announced that it signed an agreement with BSNL on June 02, 2008 for providing IPTV services in 20 cities.
As per the terms of the agreement, the services in the first city were to be launched within 4 months of the signing of the agreement. Further the company has informed that the said services have been launched in Jaipur on August 04, 2008.
The scrip touched an intra-day high of Rs44 and a low of Rs40 and recorded volumes of over 2,00,000 shares on BSE.
Shares of Petron Engineering rallied by over 6% to Rs256 after the company announced that it received Rs1bn order for Heater Works for CDU / VDU Units for Guru Gobind Singh Refinery Project of M/s. HPCL - Mittal Energy Ltd at Bathinda (Punjab). The scrip touched an intra-day high of Rs279 and a low of Rs250 and recorded volumes of over 57,000 shares on BSE.
Hansen Transmission, owned by Suzlon Energy plans big stake in Shanthi Gears. (Mint)
GM India to firm up plans for used car business in two months. (Mint)
Dabur looks to enter IT products, services. (Mint)
Bharti Airtel to launch Airtel DTH service in eight weeks. (Mint)
Coal India prefers foreign help in revival bid. (Mint)
GMR eyes airports in Eastern Europe. (Mint)
Lanco Infratech plans tie-up with four global firms to bid for railway stations. (Mint)
NTPC seeks government help to combat coal shortage. (Mint)
JK Paper looks to buy plant in South India. (Mint)
BSNL’s union rejects ESOP offer in the company from communications minister A. Raja. (BS)
Government may go ahead with BSNL IPO plan despite union protest. (BL)
SpiceJet-Ross deal runs into credit write-off problems. (BS)
Shiv-Vani wins Rs16.1bn order from ONGC. (BS)
Federal-Mogul plans 7th plan in India. (BS)
Reliance Industries says it will begin producing gas at KG field from December 2008. (BS)
Videocon group clarifies that it will be paying Rs9.5bn to Maharashtra government’s town and industrial infrastructure subsidiary CIDCO for a 100-acre plot in Navi Mumbai. (BS)
Bajaj Auto and KTM to make three vehicles. (BS)
Austral Coke to file defamation charges against Gujarat NRE Coke. (BS)
ITC to hike prices of premium brands. (BS)
SBI may raise rates by 50bps. (BS)
The Bombay High Court asks Company Law Board to pass orders in case relating to Zandu Pharmaceuticals and Emami in 15 days. (BL)
IVRCL arm to borrow more for Chennai desalination project. (BL)
HCC led JV wins Rs13.98bn pipeline order. (BL)
BPCL forays into solar power generation. (BL)
Arcelor-Mittal to invest $1.6bn in Brazil for expansion. (BL)
MRTPC says that Dish TV offer must specify scheme. (BL)
Oil producing companies, ONGC, Reliance Industries and Cairn India may have to share incremental revenues earned beyond US$75 per barrel. (ET)
Titan Industries partners with NGO to recycle old watches. (ET)
Hero Honda hikes prices by up to Rs850 with immediate effect. (ET)
Reliance ADAG venture Big TV secures IPL DTH partnership rights for Rs1.37bn. (ET)
BSNL to launch 3G services by next June. (ET)
HTMT Global in talks to acquire two companies in the US and one in UK. (ET)
Promoters raise their stake in Bajaj Holdings and Investments by 2.5%. (ET)
Tata Tea poised to issue shares of Amalgamated Plantations to a number of leading financial institutions. (ET)
Bank of India, Canara Bank and Corporation Bank raised benchmark rates to 14%. (ET)
Dena Bank hikes benchmark rates to 14.25%. (ET)
Dr Reddy’s Lab scrapped the issue of 8.41mn convertible warrants to promoters. (ET)
Adani Power signs power purchase agreement with government of Haryana for supply of 1,424MW of power for 25 years. (FE)
JSW Energy, Maha Transco to set up 400KV transmission system in the state for an investment of Rs4.75bn. (FE)
Tata Housing, Raheja group to invest Rs5bn on luxury complex in Gurgaon. (FE)
JSW Steel July crude steel output rose 24%. (FE)
Zenith Software to open a centre in Australia. (FE)
Petronet Engineering secures Rs1bn order from HPCL-Mittal Energy. (FE)
ITC Foods foraying into new categories. (FE)
SAIL to sign pact with STX for four bulk carriers. (BL)
SAIL plans coastal movement of imported coal between Vizag, Paradip and Haldia ports. (BL)
Gujarat NRE Coke accuses Austral Coke of false claims in IPO prospectus. (BL)
Promoters hike stake in Man Industries by 5% to 45%. (BL)
Aksh Optifibre signs agreement with BSNL for providing IPTV services. (BL)
KLG Systel establishes office in Singapore to market its power solutions in ASEAN. (BL)
Shiva Cement dispatches of cement in July 2008 grew 6.55%. (BL)
ITC arm acquires 0.5% stake in Ballarpur Industries. (BL)
Economy Front page
Airline firms cut weekly flights by 20% (Mint)
Panel appointed to suggest ways to reduce oil subsidy bill recommends raising oil prices every month. (Mint)
Ministry set to allow captive berths at ports. (Mint)
Japanese firms to launch scaled down versions of their international superbike models. (BS)
Inflation at 12.01% for week ended July 26, 2008. (BS)
Two wheeler companies increase prices in range of Rs800 to Rs2,000 (BL)
The National Pharmaceutical Pricing Authority approves 3-12% hike in prices of five bulk drugs. (ET)
Government plans to allow private healthcare companies to set up medical colleges. (ET)
Cement prices may fall on surplus output. (ET)
Mining Industry seeks a complete withdrawal of 15% ad volarem duty on iron ore. (ET)
Government considering a ban on export of flat steel products including hot and cold roll coils. (ET)
European Central Bank leaves interest rates at 4.25%. (ET)
Bank of England kept main interest rate unchanged at 5%. (ET)
EGoM fails to resolve issue on land ceiling, MAT or compulsory acquisition of land. (ET)
EGoM to take up gas shortage issue for Ratnagiri project on August 13, 2008. (FE)
Revived monsoon trims rain deficit to 1%. (BL)
Crude ends losing streak
Prices rose by more than 1% on supply concerns
Concerns about supplies of crude in the coming days, crude prices broke the three day losing streak and gained for the day ended on Thursday, 07 August, 2008. Prices had gained almost 3% earlier during the day. But at the end, it pared some of its gains. Crude had shed almost 5% ion its last three sessions of trading.
Crude-oil futures for light sweet crude for September delivery closed at $120.02/barrel (higher by 1.44 or 1.5%) on the New York Mercantile Exchange. Futures earlier fell to an intraday low of $118 a barrel. Last week, crude prices ended higher by 1.5%. But it has lost 4.8% since last Friday. Crude lost $15.92 (11%) in July, 2008, the biggest ever in dollars. Still at the end, it was not so bad as it seems, as prices retreated from a gain of 2.7%.
A temporary shutdown of the Baku-Tbilisi-Ceyhan pipeline raised concerns over global supplies of oil. Raising prospects of a protracted shutdown, reports said that a section of the Baku-Tbilisi-Ceyhan oil pipeline had been damaged in a fire on Wednesday.
At the currency markets on Thursday, the dollar gained on the euro after the European Central Bank held policy steady and hinted that no more interest rate hikes are coming for a while. Against this backdrop, the dollar index, a measure of the greenback against a trade-weighted currency basket, was last at 74.59, as against last closing of 74.279 on Wednesday.
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 52% higher than a year ago. For the year, crude is up by 26% till date.
Against this background, September reformulated gasoline rose 5.3 cents to close at $3.0027 a gallon and September heating oil closed almost flat at $3.2336 a gallon.
Natural-gas prices also touched their lowest level since February as traders took a good look at U.S. supply levels ahead of the winter season. Natural gas for September delivery fell by 20.2 cents, or 2.3%, to close at $8.571 per million British thermal units on Nymex.
At the MCX, crude oil for August delivery closed at Rs 5,000/barrel, higher by Rs 5 (0.1%) against previous day’s close. Natural gas for August delivery closed at Rs 360.7/mmbtu, lower by Rs 11.7/mmbtu (3.1%).
Today's Pick - Dish TV
We recommend a buy in Dish TV India from a short-term perspective. It is clearly visible from the charts of Dish TV India that it had been on a medium-term downtrend between April and July (from a high of Rs 66 to Rs 26). After recording a 52 week low at Rs 26 in early July, the stock reversed and began to trend upward.
This reversal was triggered by a positive divergence in the daily relative strength index. On August 4, the stock jumped 9 per cent breaking through the medium-term down trendline.
Subsequently, on August 7, the stock surged 11 per cent strengthening the up move. We observe heavy volume over the past four trading sessions. The daily RSI has entered into the bullish zone from the neutral region.
The moving average convergence and divergence is on the brink of entering the positive territory.
The stock is trading well above its 21- and 50-day moving averages. We are positive on the stock in the short-term.
We anticipate the stock to move up until it hits our price target of Rs 42 in the approaching trading sessions. Traders with short-term perspective can buy the stock, while maintaining a stop-loss at Rs 35.50.
via BL
Dull day for bullion metals
Gold gives up 5% in last five sessions
Bullion metal prices registered losses for the fifth straight day on Thursday, 07 August, 2008 as the dollar strengthened against most currencies. Gold prices have thus given up almost 5% in its last five sessions. Silver prices also fell for the day.
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.
Comex Gold for December delivery fell $5.1 (0.5%) to close at $877.9 ounce on the New York Mercantile Exchange. Last week, it ended lower by 2.1%. On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped since then.
This year, gold prices have gained 5% till date against a 9% drop for the dollar against the euro. Gold ended July, 2008 lower by $11 (1.1%). The yellow metal ended second quarter with a marginal gain of 0.7%. It ended June, 2008 with a gain of 4.1%. In May, it ended with a gain of higher by $22.5 (2.5%). Before May, in April, prices closed lower by 6.3%. 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 Thursday, Comex silver futures for September delivery fell 24.8 cents (1.5%) to $16.257 an ounce. Silver has gained 10% in 2008 till date. It ended July 2008 with a gain of 3%. For the second quarter, it had gained a paltry 1.4%. Silver had gained 16% in Q1. The metal also had gained for seven straight years.
At the currency markets on Thursday, the dollar gained on the euro after the European Central Bank held policy steady and hinted that no more interest rate hikes are coming for a while. Against this backdrop, the dollar index, a measure of the greenback against a trade-weighted currency basket, was last at 74.59, as against last closing of 74.279 on Wednesday.
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.
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. Silver had climbed 16% in FY 2007. In 2006, silver had jumped 46% while gold gained 23%.
At the MCX, gold prices for October delivery closed lower by Rs 82 (0.7%) at Rs 12,028 per 10 grams. Prices rose to a high of Rs 12,216 per 10 grams and fell to a low of Rs 12,003 per 10 grams during the day’s trading.
At the MCX, silver prices for September delivery closed Rs 405 (1.7%) lower at Rs 22,817/Kg. Prices opened at Rs 23,342/kg and fell to a low of Rs 22,700/Kg during the day’s trading.
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