ONGC, Cairn India, Mahindra and Mahindra, Sun TV, Divi's Labs, Aban Offshore, CESC, Sobha Developers, Unitech
Friday, October 31, 2008
My Portfolio - Oct 31 2008
Here is my weekly update on the portfolio. Updated the ordering of the scrips a bit - The Portfolio weight is in the ascending order from the top - So 64.64% loss is on the least weighted scrip and 2.67% loss on the last scrip is highest weighted scrip and 40.7% is the total loss on the portfolio
Job Cuts ? Let us know
ASSOCHAM has been forecasting a 25% job cut across various sectors
Has there been a job cut or hiring freezes in your organization (IT, Brokerage, Infrastructure, Real Estate.. or any other sectors?!). There has been news/rumours that there were layoffs in Real Estate,IT and brokerage companies . Know anyone out there ?
Leave a comment and let us know. This would help us gauge the severity of the issue.
PS: Comments can be left anonymously and cannot be tracked by anyone :)
BSE Bulk Deals to Watch - Oct 31 2008
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
31/10/2008 532811 AHLUWALIA CO GOLDMAN SACHS INVESTMENTS MAURITIUS I LTD S 500000 27.92
31/10/2008 590061 BRUSHMAN IND IVORY CONSULTANTS PVT LTD. B 90000 54.78
31/10/2008 590061 BRUSHMAN IND NANDESHWAR FINTRADE PVT LTD S 80000 54.88
31/10/2008 522059 CHAMPAGN IND ARISAIG PARTNERS ASIA PTE LTD SUB AC ARISAIG INDIA FUND LTD B 1400000 140.00
31/10/2008 522059 CHAMPAGN IND RELIANCE CAPITAL TRUSTEE CO LTD RELIANCE MONTHLY INCOME PLAN B 98857 140.00
31/10/2008 522059 CHAMPAGN IND DB INTERNATIONAL ASIA LIMITED S 1021539 140.01
31/10/2008 522059 CHAMPAGN IND CROWN CAPITAL LIMITED S 518553 140.00
31/10/2008 512199 CORE PROJECT OPG SECURITIES P LTD B 1020042 56.59
31/10/2008 512199 CORE PROJECT H.J. SECURITIES PVT. LTD. B 574149 55.82
31/10/2008 512199 CORE PROJECT OPG SECURITIES P LTD S 1020042 56.69
31/10/2008 512199 CORE PROJECT H.J. SECURITIES PVT. LTD. S 574149 56.10
31/10/2008 526033 CRYSTAL SOFT KAUSHAL NIRANJAN SHAH B 25000 6.50
31/10/2008 526033 CRYSTAL SOFT RICHILINE FINVEST PRIVATE LTD S 31800 6.45
31/10/2008 508918 GREYCELLS EN S K INVESTMENT B 30000 311.24
31/10/2008 508918 GREYCELLS EN KARSANDAS LAXMIDAS DANANI B 19000 300.00
31/10/2008 508918 GREYCELLS EN MALKA S CHAINANI S 48900 306.88
31/10/2008 532855 HARYA CAPFIN BRAHMA DEV HOLDING AND TRADINGLTD. B 250375 23.00
31/10/2008 532855 HARYA CAPFIN ODD AND EVEN TRADES AND FINANCE PVT. LTD S 250375 23.00
31/10/2008 530885 JAISAL SECUR TATIA FINAANCIAL SERVICES LTD S 33970 41.90
31/10/2008 530813 KRBL LTD SOMNATH AGARWAL S 300000 61.47
31/10/2008 512167 MATRA REALT KOTAK MAHINDRA INVESTMENT LTD S 98106 3.48
31/10/2008 526407 RIT PRO IND RAJENDRA PRASAD CHOWDHURY B 47301 48.28
31/10/2008 532404 SAVEN TECHNO LRS PORTFOLIO AND ADV SER P LTD S 74089 3.57
31/10/2008 500231 UMANG DAIR SARITADEVIDADAWALA B 100000 3.20
31/10/2008 531266 VST TILLER T PRASHANTSHRIMAL B 29311 122.40
31/10/2008 531396 WOMEN NETWKS SUNILKUMAR CHANDRAPRAKASH SHAH B 37000 3.66
Shut the ... Govt to Assocham
Taking strong exception to industry chamber Assocham's forecast that a quarter of people in certain key sectors will lose jobs in the next ten days, government on Friday said the economy is poised for the other way.
"The Deputy Chairman of the Planning Commission and my colleague Jairam Ramesh (Minister of State for Commerce) have taken serious exceptions to an Assocham report... The pace of job creation may slow down but that doesn't mean that jobs are being destroyed," Finance Minister P Chidambaram told reporters here.
The Minister further said another industry chamber FICCI too had contradicted the Assocham study, which had said that in the next ten days or so about 25 to 30 percent employees are likely to lose jobs in seven sectors including aviation, information technology, steel, financial services, real estate, cement and construction.
Chidambaram further said that 7 percent growth rate, the lowest projection made by experts, would "create more job than was done in entire NDA regime, when the growth was only 5.8 percent. Why this question was not raised when the economy was growing at 5.3 percent?"
Replying to questions on the recent report on slowing of the US economy, the Minister said, "when the world output slows down, the growth in developed countries slows down... it will have an indirect impact on India."
However, he added, "the India economy is domestic consumption and investment driven economy. Exports will play a significant role but not as much as they do in China."
Pointing out that at the moment it was difficult to estimate the impact of global economic slowdown on exports, Chidambaram said in April-August 2008-09 it grew by 35.1 percent though September showed a slight dip.
"We will see as we go along... but we are not happy that any country's economy should contract. We want all countries' economies to grow," the Minister said adding India was not happy with slowing down in the US economy. "But it is there... that's a reality," he said.
With regard to the inflation rate, which has come down to below 11 percent after four months, the Minister said, "let us hope the measures that we have taken will have an impact."
The annual rate of inflation has come down to 10.68 percent for the week ending October 18.
Replying questions on India's stand on G-20 meeting on global economy, Chidambaram said, "it is being formulated and hopefully we will be able to give some details in the next few days."
Finance Minister earlier in the week held a meeting of experts, including RBI Governor D Subbarao, SEBI Chairman C B Bhave and former RBI Governors C Rangarajan and Bimal Jalan among others, to formulate the views on global financial crisis that India would take at the G-20 meeting called by US President George Bush in Washington on November 15.
Growth will fall, but no job cuts - PC
The Indian economy would grow at 7 percent despite the global economic meltdown but this would not mean a reduction in existing job levels, Finance P Chidambaram said Friday.
"The RBI (Reserve Bank of India) estimates that growth (in fiscal 2008-09) would be at 7 percent. I think it would be at 7.5 percent but definitely would not be lower than 7 percent," Chidambaram told reporters here.
"Growth at 9 percent (as was originally anticipated) would signal rapid creation of jobs. Growth at a lower rate does not imply a destructive employment situation," the finance minister maintained.
"It is for this reason that I disagree with a (industry lobby) Assocham (Associated Chambers of Commerce and Industry) study (saying that Indian corporates would cut jobs by 25 percent due to the global financial crisis)," Chidambaram said.
"The pace of creating jobs might slow down, but even at 7 percent, jobs will be created," he added.
Responding to a question on the impact of the crisis on India's exports, Chidambaram said he couldn't "elaborate" on this.
Asked what India would bring to the table at the G-20 meeting US President George Bush has called in Washington next month to deal with the financial crisis, the finance minister replied: "We are formulating our response."
Post Session Commentary - Oct 31 2008
The Indian market ended the day on strong note on heavy buying interest over the ground. Drop in inflation number for the fifth successive week and firm global markets lifted the sentiments. Market rose more than 8% also on speculation that RBI may ease monetary policy following rate cuts across the world, including in the US, China and Japan this week. Bank of Japan cut rates for the first time in seven years, to 0.30% from 0.50% joining global efforts to ease the financial crisis. Today market started the session after a holiday with handsome gains tracking positive cues from global markets. Stocks continued to gain ground on continued buying across the board. However, market gave up some of initial gains during afternoon on profit booking, but further gathered momentum and continued its northward journey till end. The buying support was seen across all the sectoral indices mainly led by the Metal, Oil & Gas, Bank, Capital Goods, IT and Auto stocks. Mid Cap and Small Cap stocks were also on buyers'' radar.
Among the Sensex pack 28 stocks ended in green terrain and 2 in red. The market breadth was in favour of advances as 1577 stocks closed in green while 916 stocks closed in red and 82 stocks remained unchanged.
The BSE Sensex closed higher by 743.55 points at 9,788.06 and NSE Nifty ended up by 188.55 points at 2,885.60. The BSE Mid Caps and Small Caps closed with gains of 105.54 points 3,200.02 and by 90.50 points at 3,765.11. The BSE Sensex touched intraday high of 9,870.42 and intraday low of 9,361.66.
Gainers from the BSE Sensex pack are M&M Ltd (23.09%), HDFC (17.48%), JP Associates (16.55%), ICICI Bank (15.50%), Sterlite Industries (14.48%), Reliance (13.81%), Reliance Communication Ltd (13.76%), Hindalco (13.26%), Tata Steel (12.14%) and Tata Power (11.86%).
Only two losers from the BSE Sensex pack are Ranbaxy Lab (1.97%) and TCS Ltd (0.93%).
Inflation for the week ended 18th October 2008 came in at 10.68% as against 11.07% of previous week. It stood at 3.11% in the year-ago period. Inflation declined for the fifth consecutive week along with decline in inflation rate of three commodity groups - primary articles, fuel and manufactured products.
The BSE Metal index ended higher by (10.20%) or 496.73 points at 5,367.60. Major gainers are JSW Steel (32.70%), Jindal Steel (15.33%), Sterlite Industries (14.48%), Hindalco (13.26%), Tata Steel (12.84%) and Wespan Guajrat Sr (8.92%).
The BSE Oil & Gas index gained (9.11%) or 517.29 points to close at 6,195.62. Major gainers are Reliance (13.81%), Aban Offshore (13.20%), Essar Oil Ltd (11.10%), Cairn India (10.85%), Reliance Petroleum (6.61%) and Reliance Natural Resources (5.83%).
The Bank index closed higher by (7.21%) or 336.90 points to close at 5,011.24 as ICICI Bank (15.50%), Yes Bank (8.81%), HDFC Bank (8.25%), Bank of India (8.11%), Axis Bank (6.59%) and Canara Bank (5.09%) in positive territory.
The BSE Auto index ended up by (6.39%) or 161.22 points at 2,685.62. Gainers are M&M Ltd (23.09%), Bosch Ltd (15.08%), Tata Motors (9.11%), Escorts Ltd (8.69%), Apollo Tyre (5.05%) and Cummins India (4.59%).
The BSE IT index surged (5.77%) or 156.17 points at 2,861.94. Gainers are HCL Tech (13.97%), Rolta India (12.17%), NIIT Ltd (9.69%), Moser Bayer (9.12%), Oracle Fin (8.37%) and Satyam Computer (7.61%).
The BSE Capital Goods index gained (5.00%) or 333.90 points to close at 7,017.61 as Usha Martin (17.62%), Walchand In (8.77%), BHEL (8.72%), Praj Industries (8.39%), Havells India (7.85%) and Jyoti Structures (6.53%) ended in negative territory.
Up for third day
The Sensex continued to move up for the third consecutive day with the index registering smart gains on buying in heavyweight and sectoral stocks. The 30-stock benchmark index of the BSE was above 9,300 points at the starting bell and touched the high at 9,870. However, it pared the gains on selling in heavyweights and shed sharply to touch the low of 9,362 towards the close. The Sensex came close to testing 9,400 towards the day’s close, but ended the session with a gain of 744 points at 9,788. Nifty gained 189 points to close at 2,886.
The breadth of the market was marginally positive. Of the 2,574 stocks traded on the BSE, 1,574 stocks advanced, whereas 919 stocks declined. Eighty one stocks ended unchanged. Of the 13 sectoral indices, BSE Metal surged 10.20% to 5,367 followed by BSE Oil & Gas (up 9.11% to 6,195) and BSE Bankex (up 7.21% to 5,011). The remaining indices also ended higher.
Among the gainers, Mahindra & Mahindra (M&M) advanced 23.09% to Rs372.35, HDFC surged 17.48% to Rs1,764, JP Associates added 16.55% to Rs71.85, ICICI Bank advanced 15.50% to Rs399.35, Sterlite Industries gained 14.48% to Rs282.20, Reliance Industries jumped 13.81% to Rs1,370.75 and Reliance Communications was up 13.76% to Rs220.70. However, Ranbaxy Laboratories dropped 1.97% to Rs169.45 and Tata Consultancy Services declined 0.93% to Rs537.45.
Over 1.68 crore Suzlon Energy shares changed hands on the BSE followed by Hindalco Industries (1.34 crore shares), Reliance Petroleum (1.00 crore shares), Unitech (84.98 lakh shares) and Core Projects & Technologies (81 lakh shares).
Nifty November 2008 futures above 2900
Turnover declines
Nifty November 2008 futures were at 2915, at a premium of 29.40 points as compared to spot closing of 2885.60. NSE's futures & options (F&O) segment turnover was Rs 36,959.23 crore, which was lower than Rs 54,223.24 crore on Wednesday, 29 October 2008.
Reliance Industries November 2008 futures were at premium at 1380 compared to the spot closing of 1375.45.
Bharti Airtel November 2008 futures were at premium at 662.90 compared to the spot closing of 653.75.
Infosys Technologies November 2008 futures were at discount at 1387 compared to the spot closing of 1388.95.
In the cash market, the S&P CNX Nifty gained 188.55 points or 6.99% at 2885.60.
Asian markets ends October with optimism
Nikkei plunge by 5% despite a rate cut from BoJ while Sensex, Sydney ends the session higher
The stock markets across the Asian region closed mixed despite a positive lead from Wall Street. The Dow Jones Industrial Average ended the day up by 189 points, to 9,180. The Nasdaq Composite Index finished higher by 41 points at 1,698. S&P 500 finished higher by 24 points at 954.
Oil prices continued to fall on concern that the decline in the U.S. economy will curb fuel demand in the world's largest energy user. Oil retreated, taking this month's decline to 36%, after the U.S. Commerce Department said yesterday that gross domestic product contracted in the third quarter at the biggest annual pace since 2001.
Crude oil for December delivery fell as much as $2.61, to $63.35 a barrel. By 0855 GMT, Brent crude for December delivery was down $2.88 a barrel at $60.83. Oil's monthly decline may pass February 1986 as the worst month ever, when it dropped 30 percent to $13.26 a barrel.
In the currency market, the U.S. dollar was quoted in the upper 96-yen levels in late Tokyo deals, down from the lower 98-yen levels in early trade and the upper 98-yen range late Thursday.
The Australian dollar ended the local session down 2.2%, as weaker commodity prices and a decision by Japan's central bank to cut interest rates lowered demand for riskier currencies. The Aussie closed at US$0.6711-0.6716, down from Thursday's close of US$0.6859-0.6864.
The New Zealand dollar finished the domestic session lower at US$0.5880, after failing twice to push back above US$0.60 for the first time in a week, compared to Thursday's close of US$0.5925.
The South Korean won fell against the greenback for the first time in three days. The won finished the session at 1,291.0 a dollar compared to Thursday's close of 1,250.0 a dollar. Yesterday, the won posted its biggest gain against the greenback in a decade following a currency swap deal with the U.S.
The Philippines peso swinged back to the P48-to-the-dollar territory due to the US Federal Reserve’s hefty rate cut in its key policy rate, which followed that of China. Currently the peso was trading at P 48.92.
Coming back in equities, Asian stocks posted their biggest monthly fall in October, with commodity-related stocks being routed on worries over global demand. The Japanese market plunged 5.0% after the Bank of Japan announced its first rate cut in seven years, while the yen strengthened against the U.S. dollar. Hong Kong's Hang Seng index fell 2.5 per cent, but the stock markets in Australia and South Korea recovered to finish in positive terrain.
The Japanese stock market closed sharply lower, snapping a three-day winning streak. The market opened lower on profit taking following Thursday's rally and extended its losses in a late sell-off despite the Bank of Japan cutting its short-term interest rate for the first time in seven years. The financial markets in Japan will remain closed on Monday for a Culture Day national holiday.
The benchmark Nikkei 225 Stock Average plunged 5.01% or 452.8 points to 8,576.98, well below the key 9,000 level. The broader Topix index of all first-section issues also fell 32.3 points or 3.59% to close 867.12. Despite Friday's drop, stocks ended in positive territory for the week following Fed rate cut and a weaker yen. For the week, the Nikkei has gained a record 12% and the Topix rose 7%.
The Bank of Japan trimmed its key interest rate to 0.3% from a decade-high 0.5%, though the cut was by a split vote and was smaller than the market had expected. The move came under government pressure to join the global response to the worst financial crisis in 80 years.
Among a series of economic released today, the Ministry of Internal Affairs and Communications said that core consumer prices in Japan rose 2.3% on year in September, moving higher for the twelfth consecutive month. Core CPI, excluding volatile fresh food prices follows a 2.4% annual expansion in August. Overall inflation was unchanged in September at 2.1%. Tokyo core CPI for October, considered a leading indicator for the nationwide trend, climbed 1.5% on year after a 1.7% annual increase in the previous month. Minus food and energy costs, Tokyo CPI was up 0.4% after a 0.5% annual gain a month earlier.
Activity in Japan's manufacturing sector contracted in October for the eighth straight month, according to the latest survey from Nomura Holdings and the JMMA. The group's Purchasing Managers Index dropped to a seven year low of 42.2 in October, lower than the 50.0 reading that separates contraction in the sector from expansion. The accompanying PMI industrial production index fell in October to 39.7, also the lowest since December 2001.
Meanwhile, Japan's seasonally adjusted unemployment rate stood at 4.0% in September, down from 4.2 percent in August. The jobs-to-applicants ratio for September stood at 0.84; meaning 84 jobs were available per 100 applicants. The ratio, which matched a low hit in August 2004, compared with a consensus forecast of 0.85 and was down from 0.86 in August. The number of new job offers fell 13.4 percent from a year earlier after a 21.3 percent drop in August.
Soaring inflation and gaining unemployment affected the purchasing power of the people’s as overall household spending fell 2.3% in September from a year earlier in price-adjusted real terms, a smaller fall than the median market forecast for a 3.9% decrease. Compared with August on a seasonally adjusted basis, spending rose 1.7%.
The average household spent 281,433 yen ($2,856) according to data from the Ministry of Internal Affairs and Communications. Spending by wage earners' households fell 3.4 percent in September from the same month a year ago.
In Mainland China, the stock market closed sharply lower, reversing most of yesterday's gains on broad based sell off across the board amid persistent worries over corporate earnings after more listed firms posted weak third-quarter profits and on deepening domestic economic worries. The Shanghai Composite Index dropped 34.82 points, or 1.97%, to 1,728.78, off the day’s high of 1,765.50 and low of 1,721.77. The index lost 110.84 points, or 6.03%, in the week and 565 points, or 24.63%, in October
In Hong Kong, the Hang Seng Index extended losses by tumbling 2.52% or 361.18 points to 13,968.67, after adding more than 3,300 points in the previous three sessions, and the Hang Seng China Enterprises Index gave up 2.26% or 152.89 points to 6,611.15. on the month the Hang Seng index lost about 22% , the biggest monthly fall since October 2007.
In Australia, the stock markets closed session slightly higher. After starting off weak on the back of lower commodity prices, stocks saw some strength in the afternoon session and finished in positive territory. The benchmark S&P/ASX 200 index closed up 16.9 points or 0.42% at 4,018.0, extending its gains for the third consecutive trading session. The broader All Ordinaries index rose 25.40 points or 0.64% to finish at 3,982.70.
On the economic front, sales of new homes in Australia fell for a third straight month in September, though the Housing Industry Association (HIA) saw reason for optimism on the future given sharp cuts in interest rates since then. The HIA said total sales fell a seasonally adjusted 1.8 percent in September, on top of a 1.3 percent drop in August. Private detached house sales fell by 2.3 percent, outweighing a 1.2 percent rise in the volatile multi-unit sector.
In New Zealand, the stock market closed sharply higher, extending its gains for the third consecutive trading session. The benchmark NZX 50 index closed up 58.0 points or 2.10% at 2,820.9 and the broader NZX All Capital index rose 62.4 points or 2.20% to 2,868.8.
The South Korean stock market finished sharply higher after bargain hunting gathered momentum in the afternoon session. After remaining range bound in morning trade, stock saw some strength in the afternoon session and closed firmly in positive territory, extending their gains following yesterday's 12% jump. The benchmark Korea Composite Stock Price Index or Kospi closed up 28.34 points or 2.61% at 1,113.06. The index is down some 23 percent on the month but up 18.5% on the week, posting its biggest weekly gain ever.
On the economic front, a central bank report showed that South Korean manufacturers' confidence dropped to the lowest level in nearly five years in November, as companies expected a global economic downturn to hurt their business. The business survey index for manufacturers' expectations declined to 65 in November from 78 in the previous month.
Meanwhile, the National Statistical Office said that South Korea's industrial output grew at a faster pace in September on solid gains in exports of video-audio products and transportation equipment. According to the agency, industrial production expanded 6.1% year-over-year in September compared to a dismal 1.9% advance in August.
In Singapore, the benchmark Straits Times Index was 7.71 points, or 0.43%, lower to 1,794.20. On economic front, Singapore's jobless rate was unchanged at 2.2 percent in the third quarter after seasonal adjustments compared to the previous quarter, confounding expectations firms will cut hiring amid the financial crisis. Employment rose by 57,800 in the third quarter, lower than the 71,400 jobs created in the second quarter, the manpower ministry said in preliminary data on Friday.
In Taiwan the markets closed sharply higher as hopes for expanded transport and other links with China helped the market extend yesterday's upswing following a central bank rate cut. Negotiators from Taiwan and China will hold a fresh round of talks in Taipei next week, following which they may seal agreements for closer air and marine links.
Taiex, the weighted index closed up 187.02 points or 3.99% at 4,870.66, off a low of 4,659.67 and a high of 4,911.80. The market ended the week 6.36% higher, trimming its monthly decline to 14.84%.
In Thailand, the benchmark Set index gained by 7.23 points or 2.57% closing the day at 288.76. On economic front, Thailand's private consumption index rose 5.9% in September from a year earlier after a revised 4.2% rise in August and a 9.3% rise in July. The index rose 1.0% in September from August after a revised 0.3% fall in August and a 3.4% rise in July. In another data release, Thailand’s trade account showed a $142 million surplus in September after a $675 million deficit in August and a $762 million deficit in July.
In Philippines, the benchmark index PSEi escalated 4.62% or 86.16 points to 1,951.09, while the all share index was up 3.82% or 46.91 points to 1,272.57.
In India, bulls tightened their grip as key benchmark indices spurted to hit new intraday high in late trade on rally in index heavyweights. As per the provisional figures, the BSE 30-share Sensex was up 806.46 points or 8.92% to 9.850.97. The index jumped 825.91 points at the day's high of 9.870.42 in late trade. The Sensex rose 317.15 points at day’s low of 9,361.66 in early trade. The S&P CNX Nifty was down 208.20 points or 7.72% to 2,905.25 as per the provisional figures.
On economic front, the wholesale price index (WPI)-based year-on-year inflation dropped to 10.68% in the week ended 18 October from 11.07% in the previous week. Following the steady decline in headline inflation, economists expect inflation to enter single digit domain by end-November 2008.
In other regional markets, European shares fell, bringing an end to three sessions of gains, with warnings from U.K. telecommunications firm BT Group and cosmetics giant L'Oreal pacing the decline. On a national level, the U.K. FTSE 100 index dropped 1% to 4,248.47, the German DAX 30 index fell 0.6% to 4,839.48 and the French CAC-40 index declined 1.5% to 3,355.43.
On the economic front, in Italy the producer prices fell 0.5% in September compared with August and rose 7.3% year-on-year.
The weekly data release calendar will end today by releasing personal consumption expenditure for the month of September, which will be followed by quarterly employment cost index. It will be followed by the data on personal income and spending in the month of September. In the evening we will have Chicago’s purchasing managers index and Reuters consumer sentiment index for the month of October. Canada will release its monthly indicator showing the economic growth in the month of August.
Reliance communications jumps on decent results
Reliance Communications galloped 14.43% to 222 after consolidated net profit rose 17.33% to Rs 1530.78 crore in Q2 September 2008 over Q2 September 2007.
The company announced the Q2 results during market hours today, 31 October 2008.
Meanwhile, the BSE Sensex was up 743.55 points, or 8.22%, to 9,788.06
On BSE, 64.10 lakh shares were traded in the counter. The stock had an average daily volume of 25.45 lakh shares in the past one quarter.
The stock hit a high and low of Rs 234.50 and Rs 195.90 during the day. The stock hit a 52-week high of Rs 844 on 10 January 2008 and a 52-week low of Rs 148.60 on 27 October 2008.
The stock suffered a pre-result setback, plunging 24.86% in six trading sessions to Rs 194 on 29 October 2008 from Rs 258.20 on 21 October 2008.
The large-cap stock underperformed the market over the past one month till 29 October 2008, declining 40.55% as compared to the Sensex’s decline of 28.19%. It had also underperformed the market in the past one quarter, sliding 60.44% as compared to the Sensex’s decline of 34.42%.
The company’s current equity is Rs 1032.01 crore. Face value per share is Rs 5.
The current price of Rs 222 discounts Q1 June 2008 annualized EPS of Rs 6.73, a PE multiple of 32.98.
Reliance Communications’ (RCom) consolidated total income increased 23.29% to Rs 5645 crore in Q2 September 2008 over Q2 September 2007. The company added 5.25 million customers in Q2 September 2008.
Brokerages were estimating RCom to report a muted Q2 September 2008 report card due to higher interest rate and depreciation.
RCom provides telecommunication services. The company provides wireless, wire line, voice, data and Internet communication services.
Sensex tanks nearly 24% in October 2008
Key benchmark indices bounced back, closely mirroring their global counterparts, which rallied after central banks across the globe cut interest rate to tackle financial crisis. The market sentiment also got a boost after India's inflation rate fell below 11% for the first time since May 2008. It was a truncated week with stock markets closed on Tuesday (28 October 2008) and Thursday (30 October 2008) for the Diwali holidays. A special one-hour Muhurat trading session was held on Tuesday to mark the beginning of the new Samvat year 2065.
The US Federal Reserve cut its main policy rate to 1% on Wednesday, 29 October 2008, to stave off the credit crunch. China reduced rates earlier on Wednesday, 29 October 2008 with Taiwan and Hong Kong following up with rate cuts on Thursday, 30 October 2008. The Bank of Japan annnounced a 20 basis points cut in interest rate on Friday, 31 October 2008.
The BSE 30-share Sensex rose 1,086.99 points or 12.49% to 9,788.06 in the week ended Friday, 31 October 2008. The S&P CNX Nifty rose 301.6 points or 11.67% to 2885.60 in the week.
The BSE Mid-Cap index rose 104.34 points or 3.37% to 3,200.02 and the BSE Small-Cap index rose 103.28 points or 2.82% to 3,765.11. Both the indices underperformed the Sensex.
October 2008 was a very bad month for stock market investors, as the BSE 30-share Sensex declined 3,072.37 points, or 23.89%, to 9,788.06 in the month. The barometer index is down 10498.93 points or 51.75% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 11418.71 points or 53.84% below its all-time high of 21,206.77 struck on 10 January 2008.
Volatiliy characterised trading on on Monday, 27 October 2008. Short covering of derivatives positions ahead of the expiry on 29 October 2008, triggered a sharp intra-day pullback in the second half of the day's trading session after indices plunged to over three-year low in the first half, spooked by weak global equities. The BSE 30-share Sensex declined 191.51 points, or 2.2%, to close at 8,509.56, after slumping 1,003.68 points to 7,697.39 in afternoon trade, its lowest since 28 October 2005. The S&P CNX Nifty lost 59.80 points, or 2.31%, to 2,524.20.
Firm global markets and relaxation of creeping acquisition norms for promoters boosted the battered bourses on the special one-hour Muhurat trading session that was held on Tuesday, 28 October 2008. The BSE 30-share Sensex rose 498.52 points, or 5.85%, to 9,008.08. The S&P CNX Nifty was up 167.70 points, or 6.64%, to 2,691.90.
Expiry of the near month October 2008 derivatives contracts caused high volatility on Wednesday, 29 October 2008. Gains in some Asian and European markets supported domestic bourses. The BSE 30-share Sensex gained 36.43 points or 0.4% to 9.044.51. The S&P CNX Nifty was up 12.45 points or 0.46% to 2,697.05.
Ending one of the worst months in history, the market surged on Friday, 31 October 2008, as it caught up rally in global stocks on Thursday, 30 October 2008, triggered by a steep 50 basis points rate cut by the US Federal Reserve. The BSE 30-share Sensex gained 743.55 points or 8.22% to 9,788.06. The S&P CNX Nifty rose 188.55 points or 6.99% to 2885.60.
India’s largest private sector company by market capitalization and oil refiner Reliance Industries (RIL) jumped 34.98% to Rs 1370.75 in the week.
Reliance Communications rose 14.12% to Rs 220.70. India’s second largest telecom services provider by market share reported consolidated net profit of Rs 1530.78 crore, up 17.33% in Q2 September 2008 over Q2 September 2007. Its consolidated total income increased 23.29% to Rs 5645 crore in Q2 September 2008 over Q2 September 2007. The company added 5.25 million customers in Q2 September 2008.
Bharti Airtel, India’s largest telecom services provider by market share, rose 21.43% to Rs 649. Net profit declined 0.9% decline in to Rs 1604.78 crore on a 36.5% increase in sales to Rs 8274.37 crore in Q2 September 2008 over Q2 September 2007.
India’s largest state-run bank by net profit State Bank of India (SBI) fell 4.05% Rs 1109.50 after muted growth in consolidated net profit in Q2 September 2008. SBI reported a 10.60% rise in consolidated net profit to Rs 2378.19 crore on a 26.4% increase in consolidated total income to Rs 27083.47 crore in Q2 September 2008 over Q2 September 2007. The consolidated earnings include numbers of recently acquired State Bank of Saurashtra.
ICICI Bank, India's second largest private sector lender by market capitalisation, soared 28.82% to Rs 399.35. Net profit rose 1.2% to Rs 1014.21 crore and operating income 1.3% to Rs 9712.31 crore in Q2 September 2008 over Q2 September 2007.
Tata Power Company gained 10.36% to Rs 689.65, boosted by better-than-expected Q2 results. Net profit of the Mumbai-based power generation company rose 1.7% to Rs 261.93 crore and sales 45% to Rs 1958.88 crore in Q2 September 2008 over Q2 September 2007.
Suzlon Energy, the world's fifth largest wind turbine maker by sales, fell 5.93% to Rs 44.45. The company suspended a Rs 1,800 crore rights issue plan because of the stock-market slide.
The New Delhi-based real estate developer Unitech surged 59.63% to Rs 30.10. The company offloaded a 60% stake in its telecom venture for Rs 6120 crore to Norwegian telecom firm Telenor.
Foreign institutional investors (FIIs) have been pulling out their investments from India and other emerging markets to shore up resources to beat the global liquidity crunch. In India, FII were net sellers of Rs 14272.40 crore in October 2008 so far (till 28 October 2008). FIIs have sold Indian shares amounting to Rs 51064.10 crore in calendar 2008. On the other hand, mutual funds have been buying. Their net inflow in October 2008 totaled Rs 848.20 crore (till 28 October 2008).
Derivative contracts for October 2008 series expired on Wednesday, 29 October 2008, with rollovers more or less similar to previous series.
Inflation, based on the wholesale price index (WPI), slipped to 10.68% in the week ended 18th October 2008, from 11.07% in the previous week.
Market may extend gains on rate cut hopes
Although the key benchmark indices edged higher last week, the market sentiments remain fragile due to global recession worries and heavy selling by foreign funds this year.
Global markets rallied after the US Federal Reserve cut its main policy rate to 1% on Wednesday, 29 October 2008 to stave off the credit crunch. China reduced rates earlier on Wednesday, 29 October 2008 with Taiwan and Hong Kong following up with rate cuts on Thursday, 30 October 2008. The Bank of Japan annnounced a 20 basis points cut in interest rate on Friday, 31 October 2008.
Foreign institutional investors (FIIs) have been pulling out their investments from India and other emerging markets to shore up resources to beat the global liquidity crunch. In India, FII were net sellers of Rs 14272.40 crore in October 2008 so far (till 28 October 2008). FIIs have sold Indian shares amounting to Rs 51064.10 crore in calendar 2008. On the other hand, mutual funds have been buying. Their net inflow in October 2008 totaled Rs 848.20 crore (till 28 October 2008).
Concerns about corporate results will continue to haunt investors. India Inc's report card for the September 2008 quarter so far shows a dismal performance, partly due to ballooning interest cost. Aggregate results of 1401 companies showed a 20% fall in net profit on a 32.6% increase in net sales in Q2 September 2008 over Q2 September 2007. Interest cost jumped 34.7% in Q2 September 2008 over Q2 September 2007.
India's inflation rate fell below 11% for the first time since May, 2008, raising hopes for a rate cut by the central bank that left its key policy rates unchanged in the mid-year review of monetary policy on 24 October 2008. Inflation, based on the wholesale price index (WPI), slipped to 10.68% in the week ended 18th October 2008, from 11.07% in the previous week. The figure is much higher than 3.11% a year ago. Experts feel that the wholesale price index is expected to move downward, and will eventually come down to single-digit numbers by January 2009.
Market spurts on rate cut by major global central banks
Bulls tightened their grip as key benchmark indices spurted to hit new intraday high in late trade on rally in index heavyweights, Reliance Industries and ICICI Bank. The BSE Sensex was up 806.46 points or 8.92%. Earlier, weak European markets had pulled the Sensex sharply off the higher level after the barometer index had surged 814.74 points in mid-afternoon trade when it did a catch-up with a rally in global markets on Thursday, 30 October 2008, triggered by a rate cut by the US Federal Reserve. The Indian market was shut on Thursday, 30 October 2008, for a public holiday.
A steady decline in inflation for the fifth successive week and reports that the government is considering more measures to pump in liquidity in the financial system added to the positive sentiment. Bank stocks spurted on fall in inflation. IT stocks jumped on rise in American depository receipts (ADR) overnight. The market breadth was strong indicating a broad-based buying.
The wholesale price index (WPI)-based year-on-year inflation dropped to 10.68% in the week ended 18 October from 11.07% in the previous week. Following the steady decline in headline inflation, economists expect inflation to enter single digit domain by end-November 2008.
European stocks fell as on concerns about the global economy weighed on investors. Key benchmark indices in France, Germany and UK were down by between 0.34% to 2.11%.
Japan’s Nikkei average dropped 5% after a lower-than-expected 20 basis points cut in interest rate announced by Bank of Japan today, 31 October 2008. Global markets had rallied on Thursday, 30 October 2008, after the US Federal Reserve cut its main policy rate to 1% on Wednesday, 29 October 2008, to stave off the credit crunch. China cut rates on Wednesday, 29 October 2008 with Taiwan and Hong Kong following up with rate cuts on Thursday, 30 October 2008.
As per the provisional figures, the BSE 30-share Sensex was up 806.46 points or 8.92% to 9.850.97. The index jumped 825.91 points at the day's high of 9.870.42 in late trade. The Sensex rose 317.15 points at day’s low of 9,361.66 in early trade.
The S&P CNX Nifty was down 208.20 points or 7.72% to 2,905.25 as per the provisional figures.
BSE clocked a turnover of Rs 3,699 crore today, 31 October 2008 as compared to a turnover of Rs 3,104.10 on 29 October 2008.
The BSE Mid-Cap index was up 3.59% at 3,205.42 and the BSE Small-Cap index was up 2.63% at 3,771.11. Both the indices underperformed the Sensex.
The market breadth was strong. On BSE, 1538 shares advanced as compared to 952 that declined. 70 shares remained unchanged.
India’s largest private sector company by market capitalization and oil refiner Reliance Industries (RIL) surged 14.14% to Rs 1,374.90, after the petroleum ministry said the $4.20 per metric million British thermal units (mmBtu) price fixed by an empowered group of ministers for gas from Reliance Industries’ KG-D6 was only for the purpose of valuation of government share and the selling price could be higher.
Mahindra & Mahindra (up 23.33% to Rs 373), Jaiprakash Associates (up 15.82% to Rs 71.40) and Tata Power Company (up 11.93% to Rs 690) were from the major gainers from the Sensex pack.
India’s largest drug maker by sales Ranbaxy Laboratories fell 1.39% to Rs 170.45, off day’s high of Rs 200 ahead of Q3 September2008 result today.
Telecom stocks rose after mixed Q2 results. India’s largest telecom service provider by sales Reliance Communications jumped 14.95% as net profit on consolidated basis, rose 17.33% to Rs 1530.78 crore on 23.29% rise in total income to Rs 5645 crore in Q2 September 2008 over Q2 September 2007.
India’s largest telecom service provider by market share Bharti Airtel rose 8.03% to Rs 664.70 despite a 0.9% fall in net profit to Rs 1604.78 crore on 35.6% rise in total income to Rs 8302.8 crore in Q2 September 2008 over Q2 September 2007.
India’s largest oil exploration firm by revenue ONGC rose 5.38% despite a 5.7% fall in net profit to Rs 4808 crore in Q2 September 2008 over Q2 September 2007 caused by a steep rise in the subsidy burden.
India’s largest real estate major by market capitalization DLF gained 4.16% ahead of Q2 September 2008 result today.
Metal stocks shrugged off fall in metal prices on the London Metal Exchange yesterday, 30 October 2008 triggered by fears of fall in demand as the US economy shrank at a 0.3% annual rate in the third quarter, its sharpest contraction in seven years. Tata Steel, Steel Authority of India Hindustan Zinc, Sterlite Indusries rose by between 0.11% to 17.65%.
India’s largest aluminum maker by sales Hindalco Industries jumped 13.26% as net profit rose 12.04% to Rs 719.95 crore on 15.42% rise in total income to Rs 5,859.95 crore in Q2 September 2008 over Q2 September 2007. State-run aluminium major National Aluminium Company (Nalco) jumped 5.82% after net profit rose 1.07% to Rs 444.46 crore on 12.3% growth in total income to Rs 1654.50 crore in Q2 September 2008 over Q2 September 2007.
Banking stocks jumped as the fifth successive week of decline in inflation has given more room for the central bank to cut rates. The BSE's banking sector index Bankex rose 7.51% and was the third biggest gainer form the sectoral indices on BSE. India’s largest private sector bank by net profit ICICI Bank jumped 15.5% as ADR spurted 13.64% overnight. India’s largest commercial bank State Bank of India rose 0.79%.
India’s second largest private sector bank by net profit HDFC Bank gained 8.29% to Rs 981 off day’s high of Rs 1,059, as ADR soared 11.38% overnight.
ICICI Bank, State Bank of India and HDFC Bank have a weightage of 24.21%, 22.44% and 20.55%, respectively in the BSE Bankex.
Punjab National Bank rose 3.42% on 31.3% rise in net profit to Rs 707.09 crore on 35.1% rise in total income to Rs 5313.18 crore in Q2 September 2008 over Q2 September 2007.
Kotak Mahindra Bank lost 2.10% after net profit fell 36.50% to Rs 47.86 crore in Q2 September 2008 over Q2 September 2007.
India’s largest home loan lender by sales HDFC rose 11.81%.
There is speculation and anticipation in the market that the Reserve Bank of India may cut cash reserve ratio (CRR) — the cash deposits that banks are required to keep with the central bank — by one percentage point from the existing 6.5% to 5.5%.
IT stocks gained as rally in ADRs offset a stronger rupee. India's third largest IT exporter by sales Satyam Computer Services rose 5.05%, as ADR rose 7.61%. India's fourth largest IT exporter by sales Wipro rose 6.16%, as ADR jumped 7.78%. India's second largest IT exporter by sales Infosys gained 6.06%, as ADR jumped 4.98%. India's largest IT exporter by sales Tata Consultancy Services fell 0.93%.
The Indian rupee crept higher in opening deals on Friday on expectations the local stock market will rise and help revive investor appetite. The partially convertible rupee was at 49.50 per dollar, 0.4% stronger than Wednesday's close of 49.69/70 per dollar. A stronger rupee affects IT firms negatively as they earn most of their revenues in dollar terms.
India’s largest commercial vehicle maker by sales Tata motors rose 9.11% despite a 34.1% fall in net profit to Rs 346.99 crore on 11.34% rise in total income to Rs 7508.13 crore in Q2 September 2008 over Q2 September 2007.
MMTC rose 1.12% as net profit rose 24.98% to Rs 46.78 crore on 110.92% rise in total income to Rs 12497.23 crore in Q2 September 2008 over Q2 September 2007.
Essar Oil surged 11.82% on posting a net profit of Rs 26 crore in Q2 September 2008 compared to a net loss of Rs 14 crore in Q2 September 2007.
Kirloskar Electric Company rose 3.75% after the company decided to set up a manufacturing unit for AC motors and AC generators.
IVRCL Infrastructure & Projects surged 5.86% as net profit rose 61.98% to Rs 57.10 crore in Q2 September 2008 over Q2 September 2007.
While Japanese stocks tumbled, other Asian stocks were trading mixed today, 31 October 2008. Key benchmark indices in China, Singapore and Hong Kong, fell by between 0.66% to 3.09%. However, South Korea and Taiwan rose by between 2.61% to 3.99%.
Oil prices dropped more than $1 a barrel to $64.55 on Friday, 31 October 2008, after data showed the US economy suffered its sharpest contraction in seven years in the third quarter, as consumers cut spending and businesses reduced investment.
Firm global cues, easing inflation may trigger positive start
A steady decline in inflation for the fifth successive week and firm global markets will lift sentiment in early trade today, 31 October 2008, as trading resumes after a holiday. Derivative contracts for October 2008 series expired on Wednesday, 29 October 2008, with rollovers more or less similar to previous series. US light crude for December 2008 delivery fell over $2 today, 31 October 2008.
Inflation inched towards single digit with fifth successive week of decline. The wholesale price index (WPI)-based year-on-year inflation dropped to 10.68% in the week ended 18 October from 11.07% in the previous week. Following the steady decline in headline inflation, economists expect inflation to enter single digit domain by end-November 2008.
Derivative contracts for October 2008 series expired on Wednesday, 29 October 2008, with rollovers more or less similar to previous series. As per reports, marketwide rollover of positions was 76% while that of Nifty stood at 62% from October 2008 series to November 2007, by Tuesday, 28 October 2008. Marketwide rollover was 76% while Nifty rollover stood at 63% from September 2008 series to October 2008 series.
India Inc.’s report card for the September 2008 quarter so far shows a muted bottomline growth, due to ballooning interest cost. Aggregate results of 1322 companies showed a 1.8% fall in net profit on 29.90% increase in net sales in Q2 September 2008 over Q2 September 2007. Interest cost jumped 30.90% in Q2 September 2008 over Q2 September 2007.
Among the frontline companies - Bharti Airtel, Hindalco Industries, Tata Motors, DLF, Ranbaxy Laboratories, and Reliance Communications will declare their September 2008 quarterly results today, 31 October 2008.
Asian stocks were trading mixed today, 31 October 2008. China's Shanghai Composite was down 0.21% or 3.77 points at 1,759.82, Hong Kong's Hang Seng plunged 3.59% or 514.63 points at 13,815.22, Japan's Nikkei fell 2.72% or 245.64 points at 8,784.12, and Singapore's Straits Times was down 0.10% or 1.74 points at 1,800.17. However, South Korea's Seoul Composite advanced 0.21% or 2.32 points at 1,087.04 and Taiwan's Taiwan Weighted gained 1.58% or 73.78 points at 4,757.42.
US stocks climbed on Thursday, 30 October 2008 as investors snapped up shares trading near their lowest levels in five years on optimism that aggressive rate cuts by global central banks, including the Federal Reserve, will help cushion a worldwide economic downturn. The Dow Jones industrial average gained 189.73 points, or 2.11%, to 9,180.69. The S&P 500 index advanced 24 points, or 2.58%, to 954.09, while the Nasdaq Composite index surged 41.31 points, or 2.49%, to 1,698.52.
Global markets have rallied after the US Federal Reserve cut its main policy rate to 1% on Wednesday, 29 October 2008 to stave off the credit crunch. China cut rates earlier on Wednesday, 29 October 2008 with Taiwan and Hong Kong following up with rate cuts on Thursday, 30 October 2008.
Back home, the BSE 30-share Sensex gained 36.43 points or 0.4% to 9.044.51 and the S&P CNX Nifty rose 12.45 points or 0.46% to 2,697.05, in volatile trade on Wednesday, 29 October 2008.
Foreign institutional investors (FIIs) were net sellers worth Rs 1306.35 crore while mutual funds bought shares worth Rs 739.66 crore on Wednesday, 29 October 2008, according to provisional data on NSE.
FIIs were net buyers of Rs 2,197.07 crore in the futures & options segment on Wednesday, 29 October 2008. They were net buyers of index futures to the tune of Rs 1,340.41 crore and bought index options worth Rs 253.84 crore. They were net buyers of stock futures to the tune of Rs 606.07 crore while sold stock options worth Rs 3.25 crore.
US light crude for December 2008 delivery fell $1.46 to $64.50 a barrel today 31 October 2008 after weak U.S. economic data refocused attention on falling demand
Daily Call - Oct 31 2008
As we re-open today to close for the week, punters are likely to feel left out of the post Diwali party the world had. The Asian indices had sizzled on Wednesday and Thursday but our derivatives settlement prevented the punters from letting their hair down. Just to update you, the US Fed cut rates by 0.5% on Wednesday and the first reading of the US Q3 GDP came in at a negative 0.3% on Thursday. This was better than feared 0.5% de-growth. In a nutshell, the US markets have gained 115 points in the last two trading sessions.
Our view is that drop in consumer spending in the US last quarter, the sharpest in 28 years, is an indication of things to come and the US GDP could de-grow by around 2.8%. A reduction in interest rates does not address that issue at all, not because it can’t theoretically but because it actually hasn’t. Rate reductions in Asia, lower inflation for us at 10.68%, has raised hopes of rate cuts and relaxation of the CRR too. But if the RBI blinks now after staring the market down on October 24, it will sharply reduce the respect Dr.Subbarao has earned by stepping into the large shoes of Dr.Reddy. Our markets would see some recovery, led by the banks, which can then be used to lighten commitments. We are beginning the new settlement with lowest OI since September 2006. A sure indication of the lost risk appetite of Dalal Street punters.
Pre Session Commentary - Oct 31 2008
Today a market is expected to have positive opening on mixed global cues. The US markets ended with gains and the Asian markets made are trading mixed. Inflation for the week ended 18th October 2008 eased with raising expectation that very soon it may come to single digit.
On Wednesday, domestic market reported marginal gains after showing volatility during the trading session. Market was unable to remain stable ahead of expiry of the Derivative contract of the October 2008 series. Domestic market opened appreciably upper on the back of favorable global markets. However the market was not able to continue the same momentum and pared its initial gains as investors preferred to book some profits. Market revealed sea-saw movement as it was not able to hold a particular territory. Most of the Asian stock markets reported profits on hopes that the Bank of Japan and the Federal Reserve will cut interest rates as a measure to encourage economic growth. BSE Sensex ended above 9,000 level and NSE Nifty above 2,600 mark. From the sectorial front, Metal, Oil & Gas, Auto and IT were in limelight as most of the buying witnessed from these baskets. However, Reality, Pharma, FMCG and Capital Goods stocks were major sufferers of negative sentiments. We expect that market may remain volatile during the trading session. Investors will also closely watch quarterly results from top companies.
The BSE Sensex closed higher by 36.43 points at 9,044.51 and NSE Nifty ended marginally up by 12.45 points at 2,697.05. The BSE Mid Caps and Small Caps closed with losses of 62.98 points 3,094.48 and by 37 points at 3,674.61. The BSE Sensex touched intraday high of 9,297.76 and intraday low of 8,894.34.
Inflation for the week ended 18th October 2008 came in at 10.68% as against 11.07% of previous week. It stood at 3.11 per cent in the year-ago period.
The US Federal Reserve cut its key lending rate a half point Wednesday to match a historic low of 1.0 percent in the latest action to ease a credit crisis that is strangling the US economy. The cut in the federal funds rate, which impacts a number of other borrowing rates, followed an emergency half-point cut October 8 coordinated with other central banks to help fight a worldwide credit crunch.
Thursday, the US stock market ended in green with last minute gains. Investors neglected disappointing GDP data that showed the economy is shrinking. US 3rd quarter GDP reduced to 0.3% as against growth of 2.8% in 2nd quarter; biggest decline since 2001. Crude oil futures for the December delivery fell $1.54 or 2.3% to $65.96 a barrel on New York Mercantile Exchange. Crude oil fell as uncertainty still surrounding the prospects for global oil demand.
The Dow Jones Industrial Average (DJIA) closed higher by 189.73 points at 9,180.69. NASDAQ index gained 41.31 points to 1,698.52 and the S&P 500 (SPX) surged 24 points to close at 954.09 points.
Indian ADRs ended up. In technology sector, Wipro ended higher by (7.78%) and Satyam gained (7.48%), Infosys ended up by (4.98%) and Patni Computers closed higher by (4.63%). In banking sector ICICI Bank was up by (13.64%) and HDFC Bank gained (11.38%). In telecommunication sector, MTNL inclined by (6.88%), and Tata Communication was up by (2.58%). Sterlite Industries increased by (9.24%).
Today major stock markets in Asia are trading mixed. Hang Seng is lower by 514.63 points at 13,805.22. Further Japan''s Nikkei plunged 245.64 points at 8,784.12 and Singapore''s Straits Times is also down marginally by 1.74 points at 1,800.17. The Taiwan Weighted surged 73.78 points at 4,757.42 and South Korea’s Seoul Composite gained 2.32 points at 1,087.04.
The FIIs on Wednesday stood as net seller in equity and in debt. Gross equity purchased stood at Rs1802.40 Crore and gross debt purchased stood at Rs57.10 Crore, while the gross equity sold stood at Rs2813.30 Crore and gross debt sold stood at Rs109.00 Crore. Therefore, the net investment of equity and debt reported were (Rs1010.90 Crore) and (Rs51.90 Crore) respectively.
On Wednesday, the partially convertible rupee ended at 49.69/70 per dollar, off a low of 49.95 and 0.4% stronger against Monday’s close of 49.87/88. India''s rupee strengthened on hopes gains in stock markets would help revive risk appetite
On BSE, total number of shares traded was 24.23 Crore and total turnover stood at Rs. 3,104.10 Crore. On NSE, total volume of shares traded was 75.32 Crore and total turnover was Rs 11,700.8 Crore.
Top traded volumes on NSE Nifty – Unitech Ltd with total traded volume of 50487402 shares, followed by Hindalco with 48709734 shares, Suzlon Energy with 27886764 shares, RPL with 16507207 shares and Reliance Communications with 16304159 shares respectively.
On NSE Future and Options, total numbers of contracts traded in index futures were 1465660 with a total turnover of Rs.19,071.42 Crore. Along with this total number of contracts traded in stock futures were 16878.17 with a total turnover of Rs.17,258.73 Crore. Total numbers of contracts for index options were 1164671 and total turnover was Rs.17,532.61 Crore and total numbers of contracts for stock options were 28029 and notional turnover was Rs.360.48 Crore.
Today, Nifty would have a support at 2,629 and resistance at 2,774 and BSE Sensex has support at 8,756 and resistance at 9,372.
Crude drops again
Prices slip at the end after crossing $70 earlier
Crude prices fell today on Thursday, 30 October, 2008 and closed below the $66/barrel. The firm dollar and the current global crisis were the main reasons behind the fall in crude prices today.
There were also reports in the market that OPEC was thinking about another production cut. Last week, OPEC had decided on a production cut. The decision, however, failed to perk up crude prices as traders still remained extremely worried that an ongoing recession will curtail demand for energy in the coming months.
On Thursday, crude-oil futures for light sweet crude for December delivery closed at $65.96/barrel (lower by $1.53 or 2.4%) on the New York Mercantile Exchange. Prices earlier touched a high of $70.4. Prices reached a high of $147 on 11 July but have dropped almost 53% since then. Last week, prices dropped by 11% after shedding 7.5% in the week prior to that. On a yearly basis, crude price is lower by 33%. For this year in 2008, crude prices have dropped 33%.
The U.S. Energy Information Administration reported that yesterday that crude supplies climbed 500,000 barrels to 311.9 million for the week ended 24 October, 2008. They've climbed 21.7 million barrels in five weeks.
EIA also reported that motor gasoline supplies unexpectedly fell for the first time in five weeks, down 1.5 million barrels for the week ended Oct. 24 to total 195 million barrels. Supplies of the fuel had climbed 17.8 million barrels is the past four weeks. But they are still 2% below the year-ago level. And distillate stocks, which include heating oil, rose 2.3 million barrels to 126.6 million.
The report also stated that demand for petroleum products was down 7.8% over the last four-week period, compared with the same time a year ago. It averaged almost 18.9 million barrels per day during the period. Of that, motor gasoline demand averaged 8.9 million barrels per day, down 3.4% from the same time a year ago.
OPEC officials decided last Friday at its meeting at Vienna that OPEC will pare production by 1.5 million barrels a day w.e.f 1 November, 2008. The official production quota is currently 28.8 million barrels, and it will be cut by 1.5 million in November.
Last week, the Centre for Global Energy Studies said that global oil demand may fall for the first time in 15 years in 2008 and stagnate next year.
Earlier this month, in the latest monthly prediction, the Organization of the Petroleum Exporting Countries said 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.
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%.
Against this background, November reformulated gasoline fell 4.3% to close at $1.467 per gallon, while November heating oil shed 0.8% to finish at $1.9841 per gallon.
Prices for natural gas dropped more than 5% after the EIA reported a 46 billion cubic-foot increase in natural-gas supplies in storage for the week ended 24 October. December natural gas fell by 5.1% to close at $6.431 per million British thermal units.
Market may slip in early trades
The market may slip initially following overnight marginal gain in the US markets and in the major Asian indices taking a sharp dip in morning trades may pull down the domestic indices in early trades. On the technical front, the Nifty could test higher levels at 2800 and may find support at 2500, while the Sensex may face resistance at 9500 and find support at 8500.
US indices gain on Thursday as investors cheered news of easier credit and a report showing the economy shrank at a slower pace than expected in the third quarter. While the Dow Jones gained 190 points at 9181, the Nasdaq advanced 41 points to close at 1699.
Indian floats rallied sharply on the US bourses. ICICI Bank & HDFC Bank was the major gainer and vaulted by 11-13% while Satyam, Wipro, MTNL, Rediff, Infosys, Patni Computer and Dr Reddy flared up 4-7% each. Among the other gainers VSNL and Tata Motors advanced between 1-2% each.
Crude oil prices in the US market edged lower, with the Nymex light crude oil for December 08 delivery shed by $1.54 to close at $65.96 per barrel. In the commodity segment, the Comex gold for December series lost $15.50 to settle at $738.50 an ounce.
Andhra Bank, Aurobindo Pharma, Ballarpur, Bharti Airtel, Bosch, Castrol, Deccan Chronical, DLF, Essar Oil, Essar Shipping, FT, GHCL, Gujarat NRE, GVK Power, Hindalco, HPCL, HDIL, India Cement, ING Vysya, IPCA LAB, IVRCL and Kotak Bank are expected to announce their earnings numbers.
Precious metals end lower
Firm dollar turn precious metals pale
Gold prices ended lower on Thursday, 30 October, 2008. This was due to the dollar that remained relatively firm. Silver prices also fell today. A weak dollar increases the appeal of precious metals as a hedge against inflation and vice versa.
Earlier last week, gold prices had slipped to lowest levels in thirteen months as it fell below $700 level. A strong dollar was the main reason behind this. 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. Losses in equity markets had also forced traders to sell gold. Since past couple of weeks, precious metals, mainly gold, had dropped as traders tried to gain back some of the money that had lost in other markets.
On Thursday, Comex Gold for December delivery fell $15.5 (2.1%) to close at $738.5 an ounce on the New York Mercantile Exchange. On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped significantly (29%) since then. Last week, gold prices ended lower by 7.3%.
This year, gold prices have lost 11.2% till date. The dollar index has gained 11.4% this year. 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 marginally to $9.758 an ounce. Last week, silver fell 0.4%. Till date, silver has lost 30% 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.
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.
In the currency market today, the U.S. dollar also changed course, erasing earlier losses and rising against the euro and the British pound. The dollar index, which tracks the value of the greenback against a basket of other major currencies, rose 1.2%.
Crude-oil futures closed with a loss of more than 2% today retreating from an earlier high above $70 a barrel as traders assess whether interest-rate cuts in the U.S. and China may help revive the global economy and spur energy demand. Crude for December delivery fell $1.54, or 2.3%, to close at $65.96 a barrel on the New York Mercantile Exchange.
Earlier this year, the weakening dollar and higher global demand for raw materials had led to records this year for commodities including gold. Gold reached a record in March as a U.S. housing slump and credit crisis spurred the Federal Reserve to slash borrowing costs. In the latest move, the Federal Reserve has cuts its target bank lending rate to 1% from 5.25% in September, 2007. The Fed did it in eight steps.
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%.
Trading Calls - Oct 31 2008
2770
Buy Hero Honda (759)
SL 751 Target 775, 779
Buy Educomp (2026)
SL 2002 Target 2075, 2085
Buy Colgate (369)
SL 364 Target 377, 379
Sell RCom (194)
SL 198 Target 188, 186
Sell HDFC Bank (945)
SL 954 Target 925, 921
Missed a day...relax!
Slow down and enjoy life. It's not only the scenery you miss by going too fast - you also miss the sense of where you are going and why.
We missed joining in the global rally. Relax, there is no point expecting some fast gains. A smart opening may be in the offing. Use the same to book some profit. We see the indices settling lower from their opening levels. Settlement for stocks bought on October 27 and October 28, 2008 will be done today.
Meanwhile, the Fed played to the market gallery and cut key interest rates by 50 basis points. How low can it go from 1% is the big debate. This move by the Fed raises hopes of a repo rate cut in the near term. To boost to the mood, inflation has fallen to 10.68 pc and it won't be long before it reaches single digit. The cooling crude prices too add to the comfort.
Reports indicate that inflation numbers may be declared once a month starting next calendar year. Chances are the data will be more realistic as a host of prices would be added and changes would be made to the base year. Liquidity pumping could gain further momentum if recent reports are to be believed. A financial daily stated that the government is considering converting funds impounded under the market stabilization scheme (MSS) into regular borrowing. Such a move, if it does happen, could allow banks to lend to other borrowers instead of the lending to the government.
FIIs, who still have a substantial holding in the Indian market continue to remain net sellers. Reports state they may have sold less than 20 of their holdings so far. And imagine, that has crashed the indices to these levels.
The Finance Minister P Chidambaram will meet the heads of public sectors banks and financial institutions, on Nov 4 to review their performance for the second quarter ended September 2008.
Sterlite Industries could see action as it is showing renewed interest to acquire Asarco, says a report.
Assurances have reportedly come in from TCS and Infosys that they will not retrench any of their employees.
US stocks gained as easier credit and a report showing the economy shrank at a slower pace than expected in the third quarter brought some cheer.
The Dow Jones added 190 points, or 2.1%. The Standard & Poor's 500 index rose 2.6% and the Nasdaq was up 2.5%.
In other global news, the US Gross domestic product, fell at an annual rate of 0.3% in the third quarter after growing at a 2.8% rate in the second quarter. The drop was not as bad as expected bringing some relief to the market. Exxon Mobil reported a profit of $14.83 billion, the biggest quarterly profit in US history.
American Express announced that it will cut 7,000 jobs, or more than 10% of its staff, amid the ongoing credit crisis. The dollar fell against the euro and gained versus the yen.
US light crude oil for December delivery fell $1.54 to close at $65.96 a barrel on the New York Mercantile Exchange. COMEX gold for December delivery fell $15.50 to settle at $738.50 an ounce.
Bharti Airtel, BL Kashyap,Bombay Ray, DCB, DLF,GTL Infra, GVK Power,Hindalco, HPCL,India Cement,ING Vysya, IVRCL,Kesoram, Maytas,Nestle, Onmobile, PNB,Power Grid,Puravanakara, Ranbaxy, RCom,Shoppers Stop,Tata Motors and Unitech will report results today.
F&O expiry and speculations of the US FEDs decision on the interest rate kept the Indian markets highly volatile. After extending gains in the early trades key indices witnessed wild gyrations throughout the trading session. Alternate bouts of buying and selling often tossed the Indian bourses in the positive and negative terrain. Finally, the BSE benchmark Sensex gained 36 points or 0.4% to close 9,044 and the NSE Nifty index was up 12 points to close at 2,697.
Alok Industries reported net sales of Rs6.98bn for the quarter ended 30 September 2008, a jump of 50.21% over the corresponding quarter of the previous year (Rs4.64bn). Sales for the six months ended 30 September 2008 stood at Rs12.41bn - a 40.50% increase over the same period of the previous fiscal (Rs8.83bn)
Export Sales for the second quarter stood at Rs2.61bn, representing a 29.67% increase over the Rs2.01bn achieved during the quarter ended 30 September 2007. At a cumulative level, export sales for the half-year ended 30 Sep 2008 reached Rs4.59bn - an increase of 18.02% over the figure reported for the six months ended 30 September 2007 (Rs3.89bn). The stock ended lower by 2.3% to Rs17.7 after hitting an intra-day high of Rs19 and a low of Rs17 and recorded volumes of over 2,00,000 shares on BSE.
Educomp rallied by over 6% to Rs2026on the back of huge volumes. The scrip touched an intra-day high of Rs2400 and a low of Rs1830 and recorded volumes of over 7,00,000 shares on BSE.
L&T pared all its gains and ended with losses, the stock was down 1.5% to Rs763. According to reports, the company would set up heavy engineering facility in Oman to manufacture high-pressure heat exchangers and reactors. The scrip touched an intra-day high of Rs815 and a low of Rs751 and recorded volumes of over 8,00,000 shares on BSE.
M&M advanced by 8% to Rs302 after reports stated that the company would spend Rs3bn towards the brand building and promotion for launching vehicles in US.
The company also came out with its quarterly results.
The gross revenues and other income for the quarter ended 30th September 2008 grew by 19.1% to Rs77.41bn from Rs65.02bn in Q2 last year. The profit before exceptional items and tax for the quarter is Rs6.23bn as compared to Rs6.94bn in Q2 of FY08.
During the period there was also an exceptional profit of Rs331mn that accrued to the group out of the private placement of shares by group subsidiaries, Mahindra Retail Pvt Ltd and Mahindra Residential Developers Ltd. The consolidated profit after tax for Q2 after deducting minority interests is Rs3.73bn as against Rs3.92bn earned in Q2 previous year.
Reliance Capital gained by 2.5% to Rs635. According to reports, the company awaits an approval from NHB and RBI for its housing finance and consumer finance business. The scrip touched an intra-day high of Rs665 and a low of Rs620 and recorded volumes of over 21,00,000 shares on BSE.
Markets players would keep a close track of the overnight developments in the US markets specially the decision of the Federal Reserve on interest rates. Avoid any fresh buying unless you want to pick up stocks for the long term. Thursday being a holiday, you never know how global markets shape up as we open on Friday morning.
SAIL looking for new iron ore mines and renewal of its existing mines (FE)
Sterlite Industries is showing renewed interest to acquire Asarco (ET)
Telenor acquires 60% stake in Unitech’s telecom arm for Rs61.2bn (ET)
Tata Chemical postpones its expansion plans by atleast six months (DNA)
Political unrest in Sri Lanka has created hurdles for NTPC’s 500MW imported coal-based power project (FE)
Strides Arcolab to roll out 32 anti-cancer products over the next six months (BL)
Videocon Industries is looking at repositioning brands (BL)
Hinduja Foundries to set-up fourth foundry at Toopran with an outlay of Rs1.5bn (BL)
HCL Infosystems bagged a multi-year contract from Delhi Police (BL)
Religare promoters to hike stake via rights issue to 73% (BS)
Essar Steel is mulling a cut in production, if government doesn’t bring back the import duty on steel coming into India (DNA)
Hindustan Zinc keeps zinc and lead prices unchanged (BS)
IOB to raise Rs11bn through bonds issue (ET)
NDTV signs an exclusive distribution deal with ITV to launch its new channel (BS)
TCS and Infosys assures Karnataka government that they will not retrench any of their employees (BL)
Turkcell in talks to acquire 51% stake in Datacom Solutions (ET)
DoT plans to cap number of operators in each circle (FE)
EGoM defers its final decision on IT sops for SEZ units (FE)
Petroleum ministry asks finance ministry to issue Rs150bn of additional oil bonds (FE)
Fed cuts benchmark rate by 0.5% to 1% and reduces the discount rate to 1.25% (BL)
India’s inflation for the week ended October 18 falls to 10.68% from 11.07% in the previous week (ET)
Government in discussion with exporters on an incentive package for sustaining export growth (ET)
Government exploring a proposal to cut custom duty on ATF to 2.5% (ET)
RBI allows NBFC’s to raise funds by issuing perpetual debt instruments (FE)
Government is planning to capitalize banks by subscribing to preference shares (DNA)
Government is examining possibilities of cut in fuel prices (DNA)
Sesa Goa - BUY
We recommend a buy in Sesa Goa from a short-term perspective. It is evident from the charts of Sesa Goa that it has been on an intermediate-term downtrend from its early May high of Rs 220. Since then, the stock has been forming lower troughs and lower peaks. While trending down, the stock penetrated key support levels at Rs 132 and Rs 100 one after another. However, the stock recently found support in the support band between Rs 60-65, recording a 52 week low of Rs 63.60 and bounced up sharply. The stock has almost gained 20 per cent from this low, reinforcing the bullish momentum. The daily relative strength index (RSI) which is hovering in the bearish zone, is displaying positive divergence and the weekly RSI is recovering from the oversold area. Furthermore, the moving average convergence and divergence is also displaying positive divergence. We are bullish on the stock from a short-term horizon. We expect the stock to move up further until it hits our price target of Rs 90 in the upcoming trading sessions. Traders with short-term perspective can buy the stock while maintaining stop-loss at Rs 75.
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