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Friday, October 17, 2008

Nifty October 2008 futures below 3100

Turnover drops

Nifty October 2008 futures were at 3068, at a discount of 6.35 points as compared to spot closing of 3074.35. NSE's futures & options (F&O) segment turnover was Rs 43,767.13 crore, which was lower than Rs 55,892.72 crore on Thursday, 16 October 2008.

Reliance Industries October 2008 futures were at premium at 1310 compared to the spot closing of 1306.05.

Bharat Heavy Electricals October 2008 futures were at premium at 1217 compared to the spot closing of 1191.55.

DLF October 2008 futures were at discount at 289.90 compared to the spot closing of 291.90.

In the cash market, the S&P CNX Nifty lost 194.95 points or 5.96% at 3074.35.



BSE Bulk Deals to Watch - Oct 17 2008

Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
17/10/2008 515030 ASAHI INDIA AMANSA CAPITAL PTE LTD B 1000000 43.50
17/10/2008 519485 ASIA IND NET ATUL NAGINBHAI CHAUHAN B 25008 14.36
17/10/2008 590059 BIHAR TUBES APL INFRASTRUCTURE PVT LTD B 62000 102.55
17/10/2008 590059 BIHAR TUBES BHARATI MAHENDRA BHAKTA S 34755 102.30
17/10/2008 531270 DAZZEL CONFI RITU SARAOGI B 45000 3.08
17/10/2008 531270 DAZZEL CONFI PARESH BALLER S 42500 2.98
17/10/2008 532491 ECE INDUSTRI MAHENDRAKUMARAGARWALA B 45116 193.63
17/10/2008 532440 MACMILAN IND RAMESH S. DAMANI B 99998 100.10
17/10/2008 532440 MACMILAN IND DERIVE TRADING PVT. LTD B 1141461 100.00
17/10/2008 532440 MACMILAN IND DERIVE TRADING PVT. LTD S 100000 100.10
17/10/2008 632461 PUNJAB NATBK HSBC BANK MAURITIUS LTD B 1855728 509.50
17/10/2008 530269 SCIL VENTU IND FINANCE AND SEC.TRUST P. L B 25000 55.00
17/10/2008 521034 SOMA TEX IND BASMATI SECURITIES PVT. LTD. B 328664 29.00

NSE Bulk Deals to Watch - Oct 17 2008

Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
17-OCT-2008,20MICRONS,20 Microns Limited,NAMAN SECURITIES & FINANCE PVT LTD,BUY,10959,24.30,-
17-OCT-2008,20MICRONS,20 Microns Limited,PRASHANT JAYANTILAL PATEL,BUY,119363,26.58,-
17-OCT-2008,ASTRAMICRO,Astra Microwave Products,L&T CAPITAL COMPANY LIMITED,BUY,414592,38.26,-
17-OCT-2008,HDIL,Housing Development and I,GENUINE STOCK BROKERS PVT LTD,BUY,1621019,136.90,-
17-OCT-2008,HDIL,Housing Development and I,GMO EMERGING MARKETS FUND,BUY,3003730,137.91,-
17-OCT-2008,HDIL,Housing Development and I,TOTAL SECURITIES LIMITED,BUY,1403879,135.79,-
17-OCT-2008,SELMCL,SEL Manufacturing Company,ASISH FINANCE LIMITED,BUY,67703,83.00,-
17-OCT-2008,SOMATEX,Soma Textiles & Ind. Ltd.,ALKA INDIA LIMITED,BUY,700000,29.00,-
17-OCT-2008,VINCARDS,Vintage Cards & Creations,ASHOK BABULAL SHAH,BUY,3000,24.75,-
17-OCT-2008,VINCARDS,Vintage Cards & Creations,SUMITA CHUGH,BUY,5000,24.75,-
17-OCT-2008,20MICRONS,20 Microns Limited,NAMAN SECURITIES & FINANCE PVT LTD,SELL,113463,24.46,-
17-OCT-2008,20MICRONS,20 Microns Limited,PRASHANT JAYANTILAL PATEL,SELL,168120,24.10,-
17-OCT-2008,ASTRAMICRO,Astra Microwave Products,RELIGARE FINVEST LTD,SELL,450000,36.97,-
17-OCT-2008,HDIL,Housing Development and I,GENUINE STOCK BROKERS PVT LTD,SELL,1618760,137.05,-
17-OCT-2008,HDIL,Housing Development and I,TOTAL SECURITIES LIMITED,SELL,1404395,135.91,-
17-OCT-2008,SELMCL,SEL Manufacturing Company,ASISH FINANCE LIMITED,SELL,94360,71.91,-
17-OCT-2008,SOMATEX,Soma Textiles & Ind. Ltd.,SOPHIA GROWTH A SHARE CLASS OF S SET I FUND GDR,SELL,700000,29.00,-
17-OCT-2008,VINCARDS,Vintage Cards & Creations,SUMITA CHUGH,SELL,2000,24.75,-

Post Session Commentary - Oct 17 2008

The domestic market on Friday ended in deep red after paring all its initial gains on aggressive selling pressure across board led by unabated fears of a sharp global economic slowdown. It was terrible day for the market as BSE Sensex touched the lowest level since July 2006 and finally broken the psychological level of 10,000 along with NSE Nifty ended below 3,100 mark. The market started the day on pleasant note tracking global cues as US markets rebounded sharply in yesterday''s trade on the weekly jobless claims that were lower than anticipated. Filings for jobless benefits declined by 16,000 to 461,000, which was below the consensus 470,000 claims. Market was not able to sustain the momentum and turned volatile following mixed global cues along with worries about a gloomy outlook for the world economy and sluggish corporate earnings. Till afternoon market swung between positive and negative terrain as investors searched for direction. Further market continued to slip sharply to conclude the day with huge loses as trading in US index futures suggested the Dow would fall at the opening bell. Market was extremely under pressure despite positive opening of European markets. On the sectoral front, all indices ended in red and among those Reality stocks underperformed the benchmark index as ended with deep cut of more than 10%. Apart from that most of the selling pressure was led by Capital Goods, Oil & Gas, Bank, Power and IT stocks.

Among the Sensex pack all 30 stocks ended in red. The market breadth was negative as 1877 stocks closed in red while 719 stocks closed in green and 56 stocks remained unchanged on BSE.

The BSE Sensex closed lower by 606.14 points at 9,975.35 and NSE Nifty ended down by 194.95 points at 3,074.35. The BSE Mid Caps and Small Caps closed with loss of 112.29 points at 3,544.84 and by 118.50 points at 4,167.86. The BSE Sensex touched intraday high of 10,786.93 and intraday low of 9,911.32.

Losers from BSE Sensex pack are Reliance Infra (11.96%), JP Associates (10.70%), DLF Ltd (10.34%), NTPC Ltd (9.68%), Reliance Communication Ltd (9.64%), BHEL (9.00%), Sterlite Industries (8.82%), SBI (8.42%), TCS Ltd (8.29%), Tata Steel (7.99%) and Hincalco (7.96%).

The BSE Capital Goods index closed lower by 423.44 points at 7,241.36. Losers are Jyoti Structure (11.76%), Punj Lloyd (9.80%), Siemens Ltd (9.49%), BHEL (9.00%), Walchand Industries (8.16%) and Suzlon Energy (7.80%).

The BSE Metal index tumbled 378.16 points to close at 5,801.71. Major losers are Guajrat NRE C (21.52%), Sterlite Industries (8.82%), Welspan Gujarat SR (8.36%), Tata Steel (7.99%), Hindalco (7.96%) and Nalco (7.07%).

The BSE Oil & Gas index plunged 348.21 points to close at 6,479.56 as Essar Oil Ltd (10.36%), Aban Offshore (8.80%), Reliance Petroleum (8.12%), Reliance (6.58%) and Reliance Natural Resources (5.05%) ended in negative territory.

The BSE Bank index ended down by 320.07 points at 5,546.69. Losers are Kotak Bank (8.75%), SBI (8.42%), Indus Ind Bank (5.90%), HDFC Bank (5.82%), ICICI Bank (5.61%) and Union Bank (5.20%).

The BSE Reality index lost 288.37 points to close at 2,524.89. Major losers are Orbit Co (14.87%), Indiabull Real (14.16%), Unitech Ltd (12.44%), Penland Ltd (12.10%), Ansal Infrasturct (11.41%) and Parsvnath (11.30%).

The Power index went down by 150.74 points to close at 1,712.37 as Reliance Infra (11.96%), Lanco Infra (10.33%), NTPC Ltd (9.68%), Siemens Ltd (9.49%), BHEL (9.00%) and Suzlon Energy (7.80%) in negative territory.

RBI policy review, global markets to dictate trend

Concerns about a global recession may continue to weigh on the domestic bourses which have tumbled in a global equities rout in the past few days. Lack of buying support has accentuated the decline on the bourses

Foreign institutional investors (FIIs) continue to press sales. They have sold shares worth Rs 46,661.20 crore in the calendar year 2008 so far (till 16 October 2008).

Investors now await the mid-term monetary policy review by the Reserve Bank of India (RBI) due on 24 October 2008. Some reports suggest that RBI is set to cut the repo (repurchase) rate by a steep 50 basis points, to signal a strong shift in policy focus to growth from inflation. Repo rate is the rate at which RBI provides funds to banks against the collateral of government bonds for a day to three days.

On the inflation front, experts feel that the wholesale price index is expected to move downward, and will eventually come down to single-digit numbers by January 2009. Inflation based on the whole price index rose 11.44% in year through 4 October 2008, lower than previous week’s 11.8% rise, data released on 16 October 2008, showed.

Index bellwether Reliance Industries (RIL) will declare its Q2 September 2008 results on 23 October 2008. According per media reports, RIL’s gross refining margins, or GRMs, are expected to decline significantly in Q2. As per research report published by foreign brokerage houses, RIL may report a 4.3% fall in its gross refining margins (GRM) to $13 per barrel in Q2 September 2008 over Q2 September 2007. The GRM is the difference between the selling price of the finished products and raw material cost.

Reliance Industries has 13.64% weightage in Sensex and therefore any sharp fall in the stock may drag the key indices further lower.

Other September 2008 quarter results due next week include Jaiprakash Associates, Reliance Natural Resources, Reliance Petroleum, Idea Cellular, Jet Airways (India), MIC Electronics, Chambal Fertilisers & Chemicals, MRF, Pantaloon Retail (India), Federal Bank, Allahabad Bank, Bank of Rajasthan, Rolta India, United Phosphorus, Titan Industries, Ashok Leyland, Chennai Petroleum Corporation, Emami, Finolex Industries, Geodesic, Hero Honda Motors, Hindustan Motors, Hindustan Zinc, Indiabulls Securities, and Marico, among other will declare their September ended quarter results next week.

Sensex down 13% from recent high

Bears ruled the roost on the boures with the Sensex falling below 10,000 mark for the first time in more than two years. The Sensex lost 606.14 points or 5.73%, on global recession worries. Trading in US index futures suggested the Dow would fall 257 points at the opening bell.

The market declined sharply in late trade after witnessing bout of volatility earlier in the day. An initial surge boosted by reports government was considering several measures to raise domestic institutional participation in the equities, proved short-lived.

Realty and banking stocks tumbled. Index heavyweight Reliance Industries (RIL) dipped more than 7.5%. Reliance Infrastructure was down more than 13.5%, Sterlite Industries was down more than 12% and Jaiprakash Associates slumped nearly 12%. NTPC and DLF lost almost 10% eachl. Though in the red, the BSE Mid-Cap and Small-cap indices outperformed the Sensex.

The government has reportedly sought data from the Reserve Bank of India to consider a proposal to enhance the investment limit for bank exposure to equity markets. This will be part of several measures to boost domestic institutional participation in the markets at a time when foreign institutional investors (FIIs) are exiting. At present, a bank can invest up to 20% of net worth in a single company and up to 40% of net worth in a group.

The domestic markets have declined sharply in the past few days despite Reserve Bank of India’ several attempts to infuse liquidity in at a time when global recession worries have marred investor sentiment.

Asian markets were mostly lower as worries about a slowing global economy kept investors on the sidelines.

The BSE 30-share Sensex slumped 606.14 points or 5.73% to 9,975.35. The index dipped 670.17 points at the day's low of 9,911.32 in late trade, its lowest level since 24 July 2006. The Sensex rose 205.44 points at day’s high of 10,786.93, at the onset of the trading session.

The S&P CNX Nifty was down 194.95 points or 5.96% to 3,074.35. It hit a low of 3,046.60 in late trade, its lowest level since 25 July 2006.

From a recent high of 11,483.40 on 14 October 2008, Sensex has tumbled 1508.05 points or 13.13% in last three trading sessions. The barometer index is down 10,311.64 points or 50.82% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 11,231.42 points or 52.96% below its all-time high of 21,206.77 struck on 10 January 2008.

The BSE clocked a turnover of Rs 4,121 crore today as compared to a turnover of Rs 4,552 41 crore on 16 October 2008.

The BSE Mid-Cap index was down 3.07% at 3,544.84 and The BSE Small-Cap index was down 2.76% at 4,167.86. Both the indices outperformed the Sensex.

BSE Realty index (down 10.25% to 2,524.89), BSE Power index (down 8.09% to 1,71227), BSE Metal index (down 6.12% to 5,801.71), BSE Teck index (down 5.91% to 2,068.20) underperformed Sensex.

BSE FMCG index (down 2.29% to 1,858.99), BSE Consumer Durables index (down 2.64% to 2,085.28), BSE HealthCare index (down 2.68% to 3,209.02), BSE Auto index (down 3.01% to 3,099.60), BSE PSU index (down 4.71% to 5,235.48), BSE IT index (down 4.94% to 2,537.27), BSE Oil & Gas index (down 5.1% to 6,479.56), BSE Bankex (down 5.46% to 5,546.89), BSE Capital Goods index (down 5.52% to 7,241.36), underperformed the Sensex.

The market breadth was weak. On BSE, 719 shares advanced as compared to 1,877 that declined. 56 shares remained unchanged.

India’s largest private sector company by market capitalization and oil refiner Reliance Industries fell 6.58% to Rs 1,305.25 off day’s high of Rs 1,438. From a recent high of Rs 1619.70 on 14 October 2008, the stock has plunged 19.41% in the last three days on concerns of fall in refining margins.

Meanwhile, the Bombay High Court on Thursday, 16 October 2008, questioned the government about its locus standi in the legal tussle between Reliance Industries and Reliance Natural Resources over supply of gas from the former’s Krishna Godavari basin to the latter’s proposed power plant at Dadri in Uttar Pradesh. This came after the government sought to be a party to the case. The government counsel will present his case on Friday, 17 October 2008.

Reliance Infrastructure (down 11.96% to Rs 490.75), Jaiprakash Associates (down 10.7% to Rs 66.75), Reliance Communications (down 9.64% to Rs 233.95), NTPC (down 9.68% to Rs 149.75) were the major losers from the Sensex pack.

Realty stocks slumped despite possibility of home loan rate cuts by lenders due to fall in inflation and cut in the cash reserve ratio cut by the Reserve Bank of India three times in last ten days. BSE Realty index fell 10.25% and was the major loser from the sectoral indices on BSE. All the stocks from the index were in red. Realty majors, Indiabulls Real Estate, DLF and Unitech fell between 10.34% to 14.16%. Fall in lending rates may spur demand for residential properties.

Most lenders slipped despite India’s second largest private sector bank by net profit, HDFC Bank’s robust Q2 results. HDFC Bank fell 5.82% even as it reported 43.2% rise in net profit to Rs 527.98 crore on 62.8% growth in total income to Rs 4,634.32 crore in Q2 September 2008 over Q2 September 2007. The stock had fallen 4.15% yesterday, 16 October 2008, ahead of the results which hit the market after trading hours.

Other banking majors extended fell. ICICI Bank and State Bank of India fell between 5.82% to 8.42%.

India’s largest home loan lender by sales HDFC fell 1.37% even as it reported 32.5% growth in net profit to Rs 534 crore in Q2 September 2008 over Q2 September 2007. The results hit the market during trading hours.

Power stocks dropped, with the BSE Power index falling 8.09%. It was the second major loser from the sectoral indices. All the stocks from the index were in red. NTPC, Reliance Infrastructure, Tata Power Company Power Grid Corporation of India and Reliance Power slip between 3.32% to 11.96%.

Metal stocks fell on falling metal prices on mounting fears a global economic slowdown will hit demand. Hindalco Industries, Sterlite Industries, Hindustan Zinc, National Aluminum Company), Steel Authority of India fell between 4.64% to 8.82%.

India’s largest steel maker by sales Tata Steel fell 7.99% after its UK unit Corus decided to cut crude steel production by up to 20% or 1 million tonnes over the next three months due to slowing demand caused by the global financial crises. There would be no material change in production for its operations outside Europe, Tata Steel said.

Capital goods stocks fell on reports faulty government policies has resulted in surge in import of capital goods from countries like China thereby impacting the domestic capital goods industry. Bharat Heavy Electricals, Larsen & Toubro and Suzlon Energy fell between 3.19% to 9%.

India's third largest IT services provider by sales Satyam Computer Services fell 2.6% to Rs 265.95. The stock had held firm for a better part of the trading sessions after the company raised its earnings per share forecast in rupee terms for year ending March 2009 at the time of announcing Q2 September 2008 results today.

India Infoline tumbled 16.85% as net profit declined 29.20% to Rs 32.23 crore in Q2 September 2008 over Q2 September 2007.

Elecon Engineering Company declined 6.63% on BSE, as net profit declined 7.05% to Rs 16.01 crore in Q2 September 2008 over Q2 September 2007.

Pritish Nandy Communications declined 2.11% on BSE, on increase in promoters' stake in the company.

Chettinad Cement Corporation declined 2.61%, as net profit declined 32.70% to Rs 34.16 crore in Q2 September 2008 over Q2 September 2007.

Parsvnath Developers slipped 11.3%, despite bagging an order worth Rs 29.50 crore from the Delhi Metro Rail Corporation.

Hindustan Petroleum Corporation gained 3.29%, after the company formed a subsidiary for production of biodiesel.

Pyramid Saimira Theatre fell 0.88% on reports a group firm has acquired a direct-to-home services firm in Europe.

Wockhardt fell 2.36%, after the company secured US Food & Drug Administration approval for a new drug.

Jaiprakash Associates clocked the highest volume of 92.35 lakh shares on BSE. Housing Development & Infrastructure (91.5 lakh shares), Reliance Natural Resources (67.96 lakh shares), Chambal Fertilisers & Chemicals (64.28 lakh shares) and IFCI (63.7 lakh shares) were the other volume toppers in that order.

Reliance Industries clocked the highest turnover of Rs 333.61 crore on BSE. ICICI Bank (Rs 235.9 crore), Reliance Capital (Rs 225.31 crore), State Bank of India (Rs 159.36 crore) and Axis Bank (Rs 145.79 crore) were the other turnover toppers in that order.

European markets which opened after Indian markets were positive. France’s CAC 40, Germany’s DAX and UK’s FTSE 100 rose between 2.02% to 3.03%.

Asian markets were mostly lower. South Korea's Seoul Composite, Singapore’s Straits Times, and Taiwan's Taiwan Weighted, Hong Kong's Hang Seng, fell between 1.52% to 2.73%. China's Shanghai Composite index and Japan's Nikkei, rose between 1.08% to 2.78%.

US markets staged a comeback in a late-day rally in highly volatile trade on Thursday, 16 October 2008, as investors snapped up beaten-down shares a day after Wall Street's worst day since the 1987 crash. The Dow Industrials surged 401.35 points, or 4.68%, to 8,979.26. The S&P 500 index advanced 38.59 points, or 4.25%, to 946.43, and the Nasdaq composite index added 89.38 points, or 5.49%, to 1,717.71.

NIIT Tech, Concor, HDFC Bank, Sesa Goa

NIIT Tech, Concor, HDFC Bank, Sesa Goa

Daily Call - Oct 17 2008

Our markets are likely to open higher but the ensuing profit taking is likely to clip those early gains. While it is up to the banks to cut in the initial steps, their efforts could come to naught if the oil biggies , ONGC and Reliance slip and carry the whole rope down the slope. Lower base camp today is way below at the 10,000 mark in the Sensex and the domestic institutions, call them Sherpas, to come to the team’s support at lower altitudes.

While technically it is a good set up, both in the US and India, the anecdotal evidences of the credit squeeze do not allow us to take a very bullish view of things, which the charts are projecting. While the rally could last till Monday, we for one would like to book profits and not take risks for the weekend.

Pre Session Commentary - Oct 17 2008

Today Markets are likely to open positive as other markets around the world have shown some sign of bearish relief. On the domestic arena the selling pressure eased off on the second half session yesterday. Therefore today one can expect the market to be a little volatile amidst concerns of domestic as well as other market sentiments in Asia and Europe. The inflation too has eased off as wholesale price index reduced to 11.44% for the week ended 4th October 2008, as against the previous week''s 11.80% mainly due to cooling off global commodity prices. On the other hand despite the inflationary pressures RBI is infusing Rs.1,45,000 Crore to bring healthy liquidity conditions in the banking and financial sector. The domestic macro economic condition looks normal but the markets are very unpredictable as investors are very skeptic about the economic slowdown across the world and its recoupling effect on the domestic economy.

On Thursday, domestic Markets opened with heavy blood bath on the back of huge selling pressures; however after the post mid session it managed to rebound. The wide gap opening was well expected as the Asian markets had started the carnage with blood bath in the opening. The markets looked like a V shape trend after a dreadful opening in the morning. However in the second half the markets recovered swiftly on the back of short covering and value buying on some of the brutally shattered stocks. The sectors hit hard were Oil & Gas, CG, IT, Auto and Power that recorded fall of 5.57%, 5.23%, 3.99%, 3.43% and 2.24% respectively. During the trading session we expect the market to be trading volatile.

The BSE Sensex closed lower by 227.63 points at 10,581.19 and NSE Nifty ended down by 69.1 points at 3,369.3. The BSE Mid Caps and Small Caps closed with loss of 63.35 points at 3,657.13 and by 107.09 points at 4,286.36. The BSE Sensex touched intraday high of 10,787.2 and intraday low of 10,017.8.

On Thursday, US markets ended in green as the weekly jobless claims were lower than anticipated. Filings for jobless benefits declined 16,000 to 461,000, which was below the consensus 470,000 claims. However on the financial sector Citigroup and Merrill Lynch posted losses for the latest quarter. The industrial production for September decreased by 2.8%, the largest ever decline since 1974. However despite the good as well as bad news the US markets managed to end in green after a highly volatile trading session. Crude oil futures for the month of November delivery fell a barrel by $4.69 at $69.85 a barrel on New York Mercantile Exchange, lowest since 23rd August 2007. Oil dropped below $70 a barrel after the government reported massive increases in US crude and gasoline stockpiles.

The Dow Jones Industrial Average (DJIA) closed higher of 401.35 points at 8,979.26. NASDAQ index gained 89.38 points at 1,717.71 and the S&P 500 (SPX) also advanced by 38.59 points to close at 946.43 points.

Indian ADRs ended mixed. In technology sector, Wipro gained by (1.14%) followed by Satyam that ended low by (2.41%) and Patni Computers was low by (4.33%). In banking sector ICICI Bank was high by (3.85%), while HDFC Bank gained (11.76%). In telecommunication sector, Tata Communication inclined by (11.85%), while MTNL gained by (7.72%). Sterlite Industries gained by (7.32%).

Today the major stock markets in Asia opened mixed. The Shanghai Composite is trading high by 10.188 points, at 1,920.129. Hang Seng is also low by 80.39 points at 15,150.13. Further Japan''s Nikkei is high by 129.66 points at 8,588.11. Straits Times is trading is also trading low by 5.77 points at 1,945.43 and South Korea’s Seoul Composite is low by 17.56 points at 1,196.22.

The FIIs on Thursday stood as net sellers in equity and net buyers in debt. Gross equity purchased stood at Rs2041.80 Crore and gross debt purchased stood at Rs282.70 Crore, while the gross equity sold stood at Rs2882.50 Crore and gross debt sold stood at Rs204.40 Crore. Therefore, the net investment of equity and debt reported were (Rs840.70 Crore) and Rs 78.20 Crore respectively.

On Thursday, the partially convertible Indian Rupee ended at 48.82/83 per dollar weaker than Wednesday''s close of 48.52/54. In early deals it fell to low of 49.05 as losses in the domestic stock market raised concerns that FIIs would withdraw more funds.

On BSE, total number of shares traded was 29.52 crores and total turnover stood at Rs 4552.41 crores. On NSE, total volume of shares traded was 61.86 crores and total turnover was Rs 12397.5 crores.

Top traded volumes on NSE Nifty – ICICI bank with total traded volume of 21251234 shares, followed by Suzlon with 20563348 shares, Reliance Petro with 16467067 shares, Reliance Comm with 13520391 shares and ITC with 10897266 shares respectively.

On NSE Future and Options, total numbers of contracts traded in index futures were 1194841 with a total turnover of Rs18098.12 Crore. Along with this total number of contracts traded in stock futures were 1107650 with a total turnover of Rs13495.7 Crore. Total numbers of contracts for index options were 1332782 and total turnover was Rs23404.65 Crore and total numbers of contracts for stock options were 60627 and notional turnover was Rs894.25 Crore.

Today, Nifty would have a support at 3,215 and resistance at 3,430 and BSE Sensex has support at 10,450 and resistance at 11,150.

Trading Calls - Oct 17 2008

Considering the unprecedented carnage in the global financial markets and uncertainty over the fate of the US and other major economies, we would like to refrain from giving any intra-day trading ideas. We continue to advise caution at this stage.

Investors should stay on the sidelines till the global selloff abates and markets stabilise. One should not get carried away if there is any kind of a relief rally, as further selling is expected. Any advance in Indian stocks can only be sustained if global markets recover.

Big drop for bullion metals

Prices slip as investors try to regain money lost in other markets

Gold and silver prices dropped drastically today, Thursday, 16 October, 2008 as traders tried to gain back some of the money that had lost in other markets. Also pushing gold prices lower were news reports that central banks were selling gold and the relatively strong dollar. Silver prices also fell today.

On Thursday, Comex Gold for December delivery fell $34.50 (4.1%) to close at $804.5 an ounce on the New York Mercantile Exchange. Prices fell to a low of $786.6 earlier during the day. On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped significantly since then. Last week, gold prices ended higher by 3.1%.

This year, gold prices have lost 4% till date. For the third quarter ended September, 2008, gold prices ended lower by 5.1%. It was the first quarterly loss for the yellow metal since the second quarter in FY 2007. Prior to that, the yellow metal ended second quarter with a marginal gain of 0.7%. For first quarter prices gained 10.7%.

On Thursday, Comex silver futures for December delivery fell 54.5 cents (5.4%) to $9.635 an ounce. Till date, silver has lost 39% this year. Silver had ended month and quarter of September 2008 with a loss of 10%. 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.

The latest weekly data from the European Central Bank showed 7.6 tons of gold was sold during the week ended 10 October. This also led to drop in precious metal prices.

In the US stock market on Thursday, 16 October, the Dow fell by almost 350 points during the noon hours but ultimately recovered paring all of its losses and ended 300 points higher.

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 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 and vice versa.

The dollar extended gains against the yen today but slipped against the euro as risk appetite perked up during a late recovery on Wall Street. The dollar index, which measures the greenback against a trade-weighted basket of six major currencies, was at 82.287, off its peak above 82.5, but still up from 81.551 in previous day’s trading.

At the MCX, gold prices for December delivery closed lower by Rs 401 (3.04%) at Rs 12,784 per 10 grams. Prices rose to a high of Rs 13,303 per 10 grams and fell to a low of Rs 12,590 per 10 grams during the day’s trading.

At the MCX, silver prices for December delivery closed Rs 674 (3.7%) lower at Rs 17,000/Kg. Prices opened at Rs 18,146/kg and fell to a low of Rs 17,000/Kg during the day’s trading.

Crude drops below $70

Weekly inventory report weighs on crude price

Crude prices slipped today, Thursday, 16 October, 2008 below the $70 mark for the first time in fourteen months. Prices dropped today as U.S. government report showed stockpiles increased more than twice as much as forecast. The expectations among investors are also largely intact that the financial crisis will hasten a decline in consumption of oil. At the same time, The Organization of Petroleum Exporting Countries (OPEC) yesterday cut its 2009 demand forecast because of ``dramatically worsening'' conditions in financial markets.

Crude-oil futures for light sweet crude for November delivery closed at $69.85/barrel (lower by $4.69 or 6.3%) on the New York Mercantile Exchange. Prices fell to a low of $68.57 during intra day trading. Prices reached a high of $147 on 11 July but have dropped almost 52.5% since then. Crude coughed up 17% last week. On a yearly basis, crude price is lower by 16%. For this year in 2008, crude prices have dropped 28%.

The EIA reported today that crude and motor gasoline supplies each fell for a third week in a row, while distillate inventories fell for a seventh-straight week. Crude supplies rose 5.6 million barrels for the week ended 10 October to total 308.2 million barrels. They're up 18 million barrels over the past three weeks.

EIA report also showed that motor gasoline supplies climbed 7 million barrels to 193.8 million. They're up a total of 15.1 million barrels in three weeks. And distillate stocks were by 500,000 barrels to 122.1 million. They've lost 10.2 million barrels in seven weeks.

In the US stock market on Thursday, 16 October, the Dow fell by almost 350 points during the noon hours but ultimately recovered paring all of its losses and ended 300 points higher.

The dollar extended gains against the yen today but slipped against the euro as risk appetite perked up during a late recovery on Wall Street. The dollar index, which measures the greenback against a trade-weighted basket of six major currencies, was at 82.287, off its peak above 82.5, but still up from 81.551 in previous day’s trading.

In the latest monthly prediction, the Organization of the Petroleum Exporting Countries said yesterday that global oil consumption will grow 550,000 barrels a day this year compared with a year ago, down 330,000 barrels from last month's forecast. Total consumption will stand at 86.5 million barrels a day. For the next year, demand will grow 800,000 barrels a day, down 100,000 barrels from OPEC's September prediction.

The Energy Information Administration, the statistics arm of the U.S. Energy Department, also lowered its growth outlook for this year's global oil consumption by 350,000 barrels from a month ago yesterday.

For the third quarter of the year crude prices ended lower by 28%. This was the biggest quarterly drop since 1991. Before that, crude prices had gained 38% in the second quarter of this year. It was the biggest quarterly increase in nine years. For the month of September, prices registered drop of 13%.

Investors are concerned that a prolonged credit crisis would further undermine an already waning demand for energy as global growth slows down.

Against this background, November reformulated gasoline fell 16 cents to close at $1.622 a gallon and November heating oil shed 10.3 cents to end at $2.0873 a gallon.

Natural gas was the lone gainer among the energy futures Thursday. The EIA released its latest data on natural-gas supplies in storage. The report showed that supplies rose 79 billion cubic feet for the week ended 10 October. November natural-gas futures gained 11.1 cents, or 1.7%, to close at $6.703 per million British thermal units.

At the MCX, crude oil for November delivery closed at Rs 3,610/barrel, lower by Rs 33 (0.9%) against previous day’s close. Natural gas for October delivery closed at Rs 333.2/mmbtu, higher by Rs 9.1/mmbtu (2.8%).

Market seen higher in choppy trade

Key benchmark indices are likely to head in opening trade today, 17 October 2008 as indicated by the SGX October 2008 Nifty futures which rose close to 50 points. Also reports of several measures by the Reserve Bank of India to enhance liquidity in equity markets may lift sentiment. Global cues were mixed as worries about a slowing global economy keep investors on the sidelines.

In what could be a major boost for the ailing market, the government has reportedly sought data from the Reserve Bank of India to consider a proposal to enhance the investment limit for bank exposure to equity markets. This will be part of several measures to boost domestic institutional participation in the markets at a time when foreign institutional investors (FIIs) are exiting. At present, a bank can invest up to 20% of net worth in a single company and up to 40% of net worth in a group.

US crude for November 2008 delivery rose $2.74 to $72.59 a barrel today, 17 October 2008 rebounding from a 15-month low below $70 yesterday, 16 October 2008 on a late rally on the Wall Street and growing expectations of an OPEC production cut.

Asian markets were trading mixed today, 17 October 2008. China's Shanghai Composite was up 0.65% or 12.47 points at 1,922.42, Japan's Nikkei rose 1.53% or 129.66 points at 8,588.11. However, Hong Kong's Hang Seng was down 0.80% or 121.66 points at 15,108.86, Singapore's Straits Times slipped 0.29% or 5.63 points at 1,945.57, South Korea's Seoul Composite fell 2.43% or 29.48 points at 1,184.3 and Taiwan's Taiwan Weighted plunged 2.69% or 136.29 points at 4,939.68.

US markets staged a comeback in a late-day rally in highly volatile trade on Thursday, 16 October 2008, as investors snapped up beaten-down shares the day after Wall Street's worst day since the 1987 crash. The Dow Industrials surged 401.35 points, or 4.68%, to 8,979.26. The S&P 500 index advanced 38.59 points, or 4.25%, to 946.43, and the Nasdaq composite index added 89.38 points, or 5.49%, to 1,717.71.

Back home, the BSE 30-share Sensex lost 227.63 points or 2.11% to 10,581.49 and the S&P CNX Nifty ended down 69.10 points or 2.07% to 3,269.30 on Thursday, 16 October 2008, on global recession worries and on Indian stock market regulator's decision to raise margins in the derivatives segment.

Foreign institutional investors (FIIs) were net sellers worth Rs 1160.63 crore while mutual funds bought shares worth Rs 737.77 crore on Thursday, 16 October 2008, according to provisional data on NSE. FIIs were net sellers of Rs 847.30 crore in the futures & options segment on Thursday, 16 October 2008.

News Roundup - Oct 17 2008

Bharti eyes MTN-like buy to become a global brand (BS)

Bajaj Auto may cut two-wheeler production due to slowdown in motorcycles sales (BS)

Ranbaxy promoters to pay about Rs10bn as tax to complete the Daiichi transaction (BS)

Hindalco’s rights issue subscribed 55.97% (BS)

Tata Steel’s UK subsidiary, Corus, to cut crude steel production by 20% over next three months (BL)

HCL Tech has purchased 10.4% stake in Axon at 631 pence/share through market purchases (BL)

L&T looking to expand its financial services business (BS)

Jet Airways to re-instate all the 800 employees who were retrenched (BS)

Jet Airways and Kingfisher asked to clear dues to oil companies (BL)

Marico enters into race for acquiring Fem Care Pharma (ET)

Kingfisher to return up to 10 aircrafts in next twelve months (FE)

Jindal Drilling secures US$165mn order for leasing its rig to ONGC (BL)

Hinduja Group plans to rename Ashok Leyland as Hinduja Leyland (FE)

Wockhardt receives US FDA approval to sell generic Ceftazidime, an antibiotic (DNA)

Moser Baer to invest US$1bn in its various business units by 2010 (BS)

Zydus Cadila files application with the DGCI for a new drug (BS)

Orchid Chemicals receives US FDA approval for three of its abbreviated new drugs (BS)

Emami acquires controlling stake in Zandu (BL)

Omaxe Construction is planning to offer 26% stake to foreign investors and PE players (FE)

PSTL to invest US$15mn to integrate operations with World TV Europe (ET)

Chettinad Cement revives Rs2.5bn rights issue proposal (BL)

Karnataka Bank enters into MoU with ICRA (BL)

Economic Front Page

Inflation for the week-ended October 4 was at 11.44% against 11.8% for the previous week (BS)

One-day call rates touched a low of 5.65% according to CCIL (BS)

Government to consider cutting motor and cooking fuel prices (BS)

Government may raise bank exposure limits to equity markets (BS)

Oil falls below US$70/barrel for the first time since August last year (ET)

The union cabinet defers decision on raising the FDI cap for insurance companies from 26% to 49% (BS)

Central excise duty collections declined 3.8% yoy to Rs98bn in September 2008 (BS)

Traffic through Indian ports rose 7.2% in H1 FY09 (BL)

India’s savings rate to decline to 34% in FY09, predicts CMIE (ET)

PSUs barred from pulling out MF investments (ET)

Shipping Ministry to urge Finance Ministry to scrap the capital gains tax of 12.8% levied on sale of assets (ET)

Don’t get emotional!

Where we have strong emotions, we're liable to fool ourselves.

Some corporates may allow themselves to get emotional. But don’t try it with your holdings. There are challenging times when you need to let go of things close to you for your own survival. Such is the condition of the markets too. The bulls appear to be in a mood to add some greenery to the dry indices. Last afternoon they made their presence felt which helped the key indices recover after the BSE Sensex nearly breached the 10,000 mark. What could boost the sentiment is that the traded volume and turnover improved sharply over the previous day. We expect the market to open higher today following the overnight rebound in US shares. Another catalyst could be the continuing moderation in inflation and easing of the liquidity crunch in the domestic money markets.

Remain on guard as the market breadth was negative. These gains and green are just moments to charge you up and give hope that all is not lost. Don’t use it to make any fresh entry. Also, Asian markets are pretty mixed this morning, with only the Nikkei in the green (up 1.5%). Stock benchmarks in Europe and elsewhere remained under pressure. In addition, the macro picture is getting bleaker, with the excise duty receipts dropping 4% in September and several companies reportedly contemplating production cuts. The veracity of the government's data on IIP and Infrastructure growth is questionable. Like someone mentioned, ‘Just as there are no atheists in a foxhole, there are no economic fundamentalists in a crisis like this.’

Already, think tanks like CMIE and NCAER, and some brokerages have slashed their estimates for FY09 GDP. The Government and the regulators are doing their bit to shore up the banking system and check the slide in stocks. Further steps may be announced over the next few days if the situation so demands. But, the joker in the pack will continue to be global markets. And it’s not funny.

Watch out for the SEBI data on overseas lending by FIIs. On Wednesday, the market watchdog had asked FIIs and their sub-accounts to give information on lending of shares abroad and asked them to furnish details twice a week, on Tuesday and Friday. The first data will be provided today on SEBI's website, covering activity between Oct. 10 and Oct. 14.

FIIs were net sellers of Rs11.6bn (provisional) in the cash segment on Thursday while the local institutions poured in Rs7.38bn. In the F&O segment, the foreign funds were net sellers at Rs8.47bn. On Wednesday, FIIs were net sellers of just Rs8.4bn in the cash segment, taking their total outflows this year to above $11bn.

Key Results Today: Elecon Engineering, Fag Bearing, Goa Carbon, HDFC, India Infoline, JK Paper, Madras Aluminium, Mysore Cements, Novartis India, Panacea Biotec, Satyam Computer, Tata Coffee, Tata Elxsi, Zenotech Labs and Zensar Tech.

With oil prices tumbling 50% from the all-time peak of US$147 per barrel, oil producers' cartel OPEC is reportedly contemplating cutting group output at an emergency meeting in Vienna next week. According to the Finance Times (FT), OPEC has brought forward to next week an emergency meeting to consider a cut in production after oil prices dropped to less than US$70 a barrel for the first time in more than a year on worries about a global recession.

A late rebound helped US shares close higher on Thursday after a volatile day, as a steep fall in oil prices gave investors a reason to snap up shares battered in the recent selloff. After trading in a 815-point range, the Dow Jones Industrial Average rallied higher in the final hour, rising 401 points, or 4.7%, to end at 8.979.26. At one point, the blue chip barometer was down almost 400 points.

The S&P 500 climbed 38.59 points, or 4.3%, to 946.43, while the Nasdaq Composite gained 89.38 points, or 5.5%, to 1,717.71. The three main indices had been on both sides of the breakeven point throughout the morning. About four stocks gained for each that fell on the New York Stock Exchange.

US stocks fell in the morning on a couple of weak manufacturing reports and Merrill Lynch and Citigroup's losses. But the selling eased up after the major indices dipped close to last week's multi-year lows - which some market experts reckon could represent a bear market bottom.

In the last hour of trade, stocks rallied sharply, reversing the recent trend of selling off near the close. The market also seemed to benefit from a slump in commodities. The dollar strengthened versus other major currencies and the credit market showed some signs of loosening.

But, investor fear remains at an all-time high, with the CBOE Volatility (VIX) index rising to a record 81.17 on Thursday afternoon before pulling back a bit.

Oil prices continued to slide after the US government's weekly inventory report that showed a bigger-than-expected gain in crude and gasoline supplies. US light crude oil for November delivery fell US$4.65 to settle at US$69.85 a barrel on the New York Mercantile Exchange. The contract fell as low as US$68.57, the lowest level since August 2007. Gasoline prices fell another 4.1 cents overnight, to a national average of US$3.084 a gallon.

Treasury prices inched higher, lowering the yield on the 10-year note to 3.93% from 3.95% late on Wednesday. COMEX gold for December delivery plunged US$34.50 to US$804.50 an ounce. A variety of other commodities declined as well. In currency trading, the dollar rose against the euro and the yen.

Production at US factories fell by the largest amount in nearly 34 years, the Federal Reserve said. The decline was due largely to the impact of hurricanes Gustav and Ike on the Gulf Coast industry. Meanwhile, the Philadelphia Fed index, a regional reading on manufacturing, fell in October to an 18-year low. The September Consumer Price Index (CPI) showed only modest inflationary pressure.

The number of Americans filing new claims for unemployment last week fell to 461,000 from a revised 477,000 the previous week. In other news, mortgage rates spiked last week, seeing the biggest week-to-week jump since April 1987.

After the close, Google reported higher-than-expected third-quarter earnings on revenue that was in line with forecasts. The search engine's shares rose 12% in after-hours trading. AIG said it has tapped another US$12bn in emergency government funding, bringing its total to US$82.9bn as it struggles to stay afloat.

Also after the close, Advanced Micro Devices (AMD) reported a narrower quarterly loss, while IBM reported higher profit that beat estimates, after pre-announcing the results last week. Friday brings reports on housing starts and building permits in September as well as the University of Michigan's consumer sentiment index for early October. Additionally, President Bush is due to speak briefly before the market opens.

European stocks plunged, barely escaping a fresh five-year low on Thursday, as fears about an impending global recession outweighed more moves from central banks to shore up the financial system. The pan-European Stoxx 600 index slid 5% to 206.40, bringing losses since Tuesday to roughly 12%.

The UK's FTSE 100 index fell 5.4% to 3,861.39, again falling below the 4,000 level. Germany's DAX 30 dived 4.9% to 4,622.81 and the French CAC-40 index tumbled 5.9% to 3,181.00. In Vienna, the Austria ATX did even worse, falling over 9%.

Among the emerging markets, the Bovespa in Brazil fell 1% to 36,441 while the IPC index in Mexico slumped 3.2% to 20,457. The RTS index in Russia was down 9.5% to 713 and the ISE National 30 index in Turkey slid 6.9% to 34,949.

Markets staged a smart recovery in the second half of the day on the back of short covering in the realty, FMCG and banking stocks which lifted the markets. Also a sharp recovery in equity markets across Europe lifted the sentiments on Dalal Street.

BSE benchmark Sensex recovered over 550 points and NSE Nifty index recouped 170 points from their respective day’s low. Sensex ended 227 points or 2.5% lower to close 10,581 and the Nifty was down 69 points to close at 3,269.

Among the 30 components of the Sensex, 16 stocks ended in the red and only 14 stocks ended in the positive terrain. Reliance Industries, L&T, Infosys, HDFC Bank ONGC were among the major laggards. On the other hand, HDFC, Hindustan Unilever, RCom and SBI were among the major gainers.

Reliance Power announced that it would start operating its 4,000MW Sasan thermal project by December 2011. The company would start operating a 660MW unit at Sasan by 2011 and will complete the entire project by March 2013.

The Sasan plant would be the first of the company’s 13 projects to start operations. The company plans to add 28,200MW in five years, aiding to alleviate shortages of as much as 18%.

Reliance Power said that it was looking for long-term coal supply contracts from Indonesia, Chalasani. The company also sad that It would consider acquiring stakes in Indonesian coal mines.

Shares of RPower declined by 3% to Rs117 hitting an intra-day high of Rs119 and a low of Rs111 and recorded volumes of over 20,00,000 shares on BSE. The company's shares have fallen ~51% since listing in February compared to a 39% drop in benchmark 30-share Sensex.

Bank of India gained by 2.5% to Rs296 after the company announced that it raised Tier- II Capital through issue of Upper Tier-II Capital Bonds of Rs5bn on October 16, 2008. The scrip has touched an intra-day high of Rs302 and a low of Rs273 and recorded volumes of over 9,00,000 shares on BSE.

Biocon posted a net profit after tax of Rs335.3mn for the quarter ended September 30, 2008 (down 24%) as compared to Rs440.1mn for the quarter ended September 30, 2007.

However, Total Income has increased by 11% from Rs2,413.2mn for the quarter ended September 30, 2007 to Rs2682.7mn for the quarter ended September 30, 2008.

Biocon declined by over 3% to Rs125 touching an intra-day high of Rs128 and a low of Rs118 and recorded volumes of over 77,000 shares on BSE.

Cadila announced the filing of the IND application for ZYT1 - a novel lipid lowering molecule with the DCGI. Designed and developed at the Zydus Research Centre.

In preclinical studies, ZYT1 has demonstrated beneficial effect on LDL-cholesterol and triglycerides, comparable to the effects seen with statins. When combined with statins, ZYT1 exhibited a pronounced effect in lowering LDL-cholesterol and triglycerides with the added benefit of a very high margin of safety.

Shares of Cadila slipped 5% to Rs255 hitting an intra-day high of Rs265 and a low of Rs253.