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Wednesday, December 17, 2008
Asian markets advance on Fed record rate cut
Hong Kong follows Fed with 100 bps cut while Japan expected to cut rates tomorrow
Stock markets across the Asian region closed higher after the U.S. Federal Reserve cut its key interest rate to a historic low in an effort to perk up the sagging U.S. economy. However, the major Asian averages came off their early highs over the course of the trading session amid worries about a bleak global economic outlook and concern over corporate earnings.
Asian market started the day higher taking cue from Wall Street. On Wall Street, the Dow Jones industrials surged up 360 points or 4.2% to 8,924.1, the Standard & Poor's 500 index advanced 44.6 points or 5.1% to 913.2 and the Nasdaq composite index rose 81.6 points or 5.4% to 1,589.9.
In the commodity market, crude oil prices rose for the first time in last four day trading above US$44 a barrel in Asia as OPEC is poised to enact its largest production cut in a decade at a meeting today in Algeria. Light, sweet crude for January delivery, due to expire on Friday, was up $1.02 at $44.62 a barrel by 3:39 a.m. ET, after settling down 91 cents at $43.60 a barrel on the New York Mercantile Exchange on Tuesday.
In the currency market, the U.S. dollar traded in the upper 88-yen range in late Tokyo deals. The dollar was quoted at 88.79-88.82 yen, down from 89.01-89.04 yen in early trade and Tuesday's close of 90.29-90.30 yen in Tokyo.
China's Yuan was slightly higher at 6.8370 per U.S. dollar compared to Tuesday's close of 6.84480.
The Hong Kong dollar was trading at HK$ 7.75 against the dollar. Actually The Hong Kong dollar is pegged at HK$ 7.8 to the U.S. dollar but can trade between HK$ 7.75 and HK$7.85 to the U.S. dollar.
The Australian dollar closed 4.25% stronger as an unprecedented U.S. rate cut boosted the appeal of the local currency. The Aussie finished the domestic session at US$0.6980-0.6985 compared to Tuesday's close of US$0.6695-0.6700
The New Zealand dollar raced to a five-week high following the Federal Reserve's decision to cut interest rates more aggressively than expected. The kiwi finished the domestic session at US$0.5805, up from US$0.5790 in early trade and US$0.5586 at close on Tuesday.
The South Korean won strengthened against the U.S. dollar. The won finished the domestic session at 1,324.7 a dollar; extending its gains for a third day, compared Tuesday's close of 1,349.6 a dollar.
The Taiwan dollar ended session at NT$32.639 to the US dollar, compared with the previous close of NT$33 i.e. appreciation of 0.93%.
Coming back in equities, Japanese stock market managed to finish in positive terrain, recovering a portion of the losses posted in the previous trading session. The benchmark Nikkei 225 Stock Average gained 44.50 points or 0.52% to close at 8,612.52. The broader Topix index of all First Section issues on the Tokyo Stock Exchange closed up 9.84 points or 1.19% at 838.5. Investors are expecting a rate cut from Bank of Japan in its Thursday meeting.
On the economic front, Japan's Cabinet office said in a final report that the leading index declined to 85.2 in October from 89.2 in September. The October reading was revised up from 85.0. A year ago, the leading index was at 96.2. At the same time, the coincident index logged a reading of 97.7, down from 100.1 in September. It was revised up from 97.6 reported initially. The lagging index fell to 98.2 from 97.9 seen in September.
In Mainland China, the Chinese stock market extended its gains for the third day in a row by finishing only slightly higher. The benchmark Shanghai Composite Index rose 1.81 points or 0.09% to 1976.8, while the Shenzhen Composite Index rose 5.63 points or 0.94% to 607.39.
In Hong Kong, the share prices close higher as Hong Kong Monetary Authority (HKMA) slashed its base rate to a record low following US Federal Reserve decision. The central bank slashed the rate charged through its overnight discount window by 100 basis points to 0.50%, the lowest since the HKMA set up the base rate in September 1998. The market was also hoping that China would announce an interest rate cut or other economic stimulus measures following a Fed cut.
The Hang Seng index closed up 330.31 points or 2.18% at 15,460.52. The Hang Seng China Enterprises index was up 308.51 points or 3.83% at 8,372.26.
The Australian stock market closed higher, but pared back most of the early gains after Commonwealth Bank said that it is in the final stages of raising A$2 billion capital. After surging 2% at the opening bell, the benchmark S&P/ASX 200 finished up 14.4 points or 0.4% at 3,570.6. The broader All Ordinaries index advanced 16.1 points or 0.5% to at 3,515.0.
On the economic front, the leading economic index, published by Westpac Bank and Melbourne University's Institute of Applied Economic and Social Research, registered a decline to an annualized growth of 0.6% in October from the 1.1% growth reported for September and was down from the long-term average of 3.8%. The coincident index, measuring current economic activity, rose at an annualized rate of 1.6% in October, a slight increase from September's reading of 1.5%.
In other economic news, a report from the Australian Bureau of Statistics showed that merchandise imports in Australia increased a seasonally adjusted 2.0% in November compared to October. Meanwhile, data released by the Department of Education, Employment and Workplace Relations showed that Australia's index of skilled job vacancies fell a seasonally adjusted 15.9% in December from the previous month and was 48.2% lower than a year ago. The Housing Industry Association is scheduled to release its new home sales data for November later in the day.
The New Zealand stock market closed in positive territory for the second straight trading session on Wednesday. The market opened higher, tracking Wall Street's rally overnight on the back of a larger-than-expected Fed rate cut, but pared back gains over the course of the trading session to end flat. The benchmark NZ50 index closed up 0.85 point or 0.03% at 2,695.93 and the broader NZX All Capital index advanced 0.21 point or 0.01% to 2,740.56.
The South Korean stock market closed higher, led by financial stocks, as the U.S. Federal Reserve's historic interest rate cut buoyed investor sentiment. The benchmark Korea Composite Stock Price Index or Kospi closed up 8.19 points or 0.71% at 1,169.8.
In Taiwan, the stock markets closed higher after a massive rate cut from Fed supported by technology sector rally led by UMC after an announcement of major share purchase programme and DRAM shares rise on hopes of potential government rescue. Taiex, the benchmark index closed up 31.13 points or 0.67% at 4,648.02, its strongest finish since 11 December 2008.
In India, the key benchmark indices slumped in the closing trade as European stocks fell after early gains and on lower US index futures. At 15:42 IST, the BSE 30-share Sensex was down 261.69 points, or 2.62%, to 9,715.29. The Sensex rose 96.12 points at the day's high of 10,073.10 hit in early trade.
Elsewhere, Singapore, the Strait Times was down by 0.16% or 2.80 closing at 1779.29; Malaysia's KLCI closed up 0.9% at 862.50 and Indonesia's Jakarta composite closed the day down by 21.15 points or 1.57% higher at 1,363.98. In Philippines, the PSEi index gained 0.81% or 15.24 points to 1,904.56.
In other regional market, European shares fell today morning, as initial gains made after a steep rate cut from the U.S. Federal Reserve quickly faded, with BNP Paribas shares dropping sharply. On a national level, the U.K. FTSE 100 rose 0.1% to 4,313.50, the German DAX 30 index climbed 0.3% to 4,745.44 and the French CAC-40 index advanced 0.3% to 3,259.79.
BSE Bulk Deals to Watch - Dec 17 2008
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
17/12/2008 590059 BIHAR TUBES NISHWET MANAGEMENT SERVICES PVT LTD B 175000 69.96
17/12/2008 590059 BIHAR TUBES NIRMAN MANAGEMENT SERVICES PVT LTD B 300000 69.97
17/12/2008 590059 BIHAR TUBES APL INFRASTRUCTURE PRIVATE LIM S 570000 70.00
17/12/2008 590059 BIHAR TUBES PIONEER NIRMAN INDIA PRIVATE L S 52500 69.95
17/12/2008 526033 CRYSTAL SOFT N SUBRAMANIAM B 25000 8.49
17/12/2008 526033 CRYSTAL SOFT SURYA MAHAL PROPERTIES PVT LTD S 50000 8.49
17/12/2008 513059 G.S. AUTO HARDIK M MITHANI B 39475 26.47
17/12/2008 513059 G.S. AUTO SPJSTOCK B 19867 25.67
17/12/2008 513059 G.S. AUTO MEET SHARES AND STOCK SERVICES P LTD B 30841 26.33
17/12/2008 513059 G.S. AUTO HARDIK M MITHANI S 38786 26.21
17/12/2008 513059 G.S. AUTO SPJSTOCK S 19867 25.65
17/12/2008 513059 G.S. AUTO MEET SHARES AND STOCK SERVICES P LTD S 95841 25.27
17/12/2008 513059 G.S. AUTO SHARDA C PUJARA S 26000 25.87
17/12/2008 508918 GREYCELLS EN INDIA MAX INVESTMENT FUND LTD. B 32500 279.45
17/12/2008 508918 GREYCELLS EN JUSAL TRADING P. LTD. S 32500 279.45
17/12/2008 522217 GUJ APO IND MITUL A PATEL B 200000 90.30
17/12/2008 522217 GUJ APO IND AJITKUMAR TRIBHOVANDAS PATEL S 200000 90.30
17/12/2008 509069 INFOMEDIA RUANE CUNNIFF AND GOLDFARB INC ACACIA II PARTNERS LP B 254200 81.50
17/12/2008 509069 INFOMEDIA ACACIA CONSERVATION FUND S 254200 81.50
17/12/2008 512185 IOL NET COM KRISMA INVESTMENT PVT. LTD. B 235000 34.05
17/12/2008 512185 IOL NET COM INDIA MAX INVESTMENT FUND LTD. S 300000 34.05
17/12/2008 531602 KOFF BR PICT HAREN TEXTILES PVT LTD S 107500 3.60
17/12/2008 511728 KZLEASING RAJENDRA HARISHINH PARMAR B 17165 39.16
17/12/2008 511728 KZLEASING KALPESH SHAH B 25000 39.19
17/12/2008 511728 KZLEASING RAJENDRA HARISHINH PARMAR S 28300 39.27
17/12/2008 532553 MSK PROJECTS CLSA MAURITIUS LIMITED S 128942 46.00
17/12/2008 505196 TIL LIMITED AVIJIT MAZUMDAR B 55000 135.00
17/12/2008 532824 VIJAYES TEXT HSBC BANK MAURITIUS LIMITED S 144766 5.51
NSE Bulk Deals To Watch - Dec 17 2008
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
17-DEC-2008,CHAMBLFERT,Chambal Fertilizers Ltd.,PACE FINANCIAL SERVICES,BUY,2213032,41.28,-
17-DEC-2008,EDUCOMP,Educomp Solutions Limited,TRS INTERNATIONAL ACTIVE PORTFOLIO,BUY,122700,2377.14,-
17-DEC-2008,FIRSTWIN,First Winner Industries L,REAL MARKETING PVT LTD,BUY,95680,21.38,-
17-DEC-2008,HCIL,HIMADRI CHEMICALS AND IND,HIMADRI DYES & INTERMEDIATES LTD,BUY,300000,116.00,-
17-DEC-2008,HDIL,Housing Development and I,GENUINE STOCK BROKERS PVT LTD,BUY,1811282,151.17,-
17-DEC-2008,PIONEEREMB,Pioneer Embroideries Limi,SUNITA BHAGCHANDKA,BUY,91188,16.76,-
17-DEC-2008,PROVOGUE,Provogue (India) Limited,RUANNE CUNNIFF & GOLD FARB INC,BUY,2032855,42.20,-
17-DEC-2008,SURANATELE,Surana Telecom Ltd.,MRO TEK LIMITED,BUY,141024,24.86,-
17-DEC-2008,VINCARDS,Vintage Cards & Creations,DUDHERIA LAXMIPAT,BUY,4218,16.60,-
17-DEC-2008,CHAMBLFERT,Chambal Fertilizers Ltd.,PACE FINANCIAL SERVICES,SELL,2261332,41.35,-
17-DEC-2008,HCIL,HIMADRI CHEMICALS AND IND,SHYAM SUNDAR CHOUDHARY,SELL,300000,116.00,-
17-DEC-2008,HDIL,Housing Development and I,GENUINE STOCK BROKERS PVT LTD,SELL,1811282,151.31,-
17-DEC-2008,MANGLMCEM,Mangalam Cement Ltd,DEUTSCHE SECURITIES MAURITIUS LIMITED,SELL,142486,47.98,-
17-DEC-2008,PROVOGUE,Provogue (India) Limited,RUANNE CUNNIFF & GOLD FARB INC,SELL,2032855,42.20,-
17-DEC-2008,VINCARDS,Vintage Cards & Creations,SUSHIL KUMAR JOHAR,SELL,3558,16.60,-
Post Session Commentary - Dec 17 2008
The domestic market slipped sharply since afternoon trade to close in red terrain on lower US index futures along with dive in European stocks. Earlier market was showing volatility on constant bouts of buying and selling. Initially market surged on positive cues from US markets as the Federal Open Market Committee, cuts the Fed funds rate to target range of 0 - 0.25%. But suddenly the markets gave up their early gains as India''s fourth largest software firm in terms of sales, Satyam Computer Services suspended to buy two related companies. The company called-off deal over the acquisition of Maytas Properties and Maytas Infra that led to the negative sentiments.
The Indian market opened on positive note today on the back of encouraging cues from the global markets led by Fed decision to cut Fed funds rate. However market was not able to hold the same momentum and pared its gains soon after start. Further stocks continued to swing between positive and negative zone till afternoon session. Finally at the end, market closed with losses as investors resorted to profit booking. BSE Sensex ended around 9,700 mark and NSE Nifty below 3,000 level. From the sectoral front, Investors off-loaded positions across the sectors and Reality stocks took a sharp bit as ended with deep cut of more than 7%. Apart from that, Teck, Power Metal, IT, Capital Goods and Oil & Gas stocks contributed to most of selling pressure. Midcap and Smallcap stocks also followed a similar trend.
Among the Sensex pack 21 stocks ended in red territory and 9 in green. The market breadth was negative as 1569 stocks closed in red while 956 stocks closed in green and 72 stocks remained unchanged.
The BSE Sensex closed lower by 261.69 points at 9,715.29 and NSE Nifty ended down by 87.40 points at 2,954.35. The BSE Mid Caps and Small Caps ended with losses of 108.04 points and 98.09 points at 3,136.17 and 3,678.56 respectively. The BSE Sensex touched intraday high of 10,073.10 and intraday low of 9,682.91.
Losers from the BSE Sensex pack are Satyam Computer (30.22%), Reliance Infra (13.73%), Reliance Communications Ltd (13.36%), JP Associates (12.21%), ACC Ltd (9.21%), DLF Ltd (8.64%), Tata Power (5.92%), Sterlite Industries (5.16%), Bharti Airtel (4.73%) and BHEL (4.37%).
Gainers from the BSE Sensex pack are ICIC Bank (2.43%), HDFC Bank (1.83%), Infosys Tech (1.51%), Wipro Ltd (1.50%), HUL (1.27%), M&M Ltd (1.25%), Grasim Industries (0.55%) and ONGC Ltd (0.39 %).
The BSE Reality index ended down by (7.36%) or 169.18 points at 2,129.21. Major losers are Indiabull Real (11.13%), Orbit Co (10.57%), Unitech Ltd (9.11%), DLF Ltd (8.64%), Mahindra Life (8.16%) and Ansal Infra (6.75%).
The BSE Teck index plunged (5.02%) or 101.89 points to close at 1,926.48. Losers are Satyam Computer (30.22%), Reliance Communications Ltd (13.36%), Moser Bayer (11.17%), Rolta India (10.26%), Dish TV (9.98%) and Adlabs Film (9.25%).
The BSE Power index ended lower by (4.44%) or 81.07 points at 1,743.64. Main Losers are GVK Power (14.00%), Reliance Infra (13.73%), Suzlon Energy (9.40%), Crompton Greaves (7.00%), Reliance Power (6.42%) and Lanco Infra (5.84%).
The BSE Metal index dropped by (4.36%) or 242.63 points to close at 5,323.44 as Welspan Gujarat SR (13.59%), Steel authority (8.77%), NMDC Ltd (7.34%), Ispat Industries (7.07%), Jindal Saw (6.93%) and JSW Steel (6.78%) ended in negative territory.
The BSE IT index lost (4.04%) or 94.65 points to close at 2,245.93 as Satyam Computer (30.22%), Moser Bayer (11.17%), Rolta India (10.26%), Financ Tech (7.29%), NIIT Ltd (6.46%) and Aptech Ltd (5.21%) ended in red.
The BSE Capital Goods index ended lower by (2.90%) or 189.85 points at 6,835.42. Major losers are Thermax Ltd (15.96%), Suzlon Energy (9.40%), Praj Industries (8.82%), Gammon India (8.74%), Reliance Industrial Infra (8.38%) and Walchand Industries (7.24%).
Market gives up three-day winning streak
Taking cue from last three day’s gain of around 342 points, Sensex opened on a firm note at 10,073, around 96 point up from the previous close of 9,977. While the market witnessed a fluctuating trend for a while, the afternoon trades saw the index tumble below the 9,700 mark to touch the day's low of 9,683 amid relentless selling pressure. Sensex finally ended the day with loss of 262 points at 9,715, whereas Nifty declined by 87 points to close at 2,954.
Market breadth was extremely weak as losers outdid gainers. Of 2,597 stocks traded on the BSE, 1,569 stocks declined while 956 stocks advanced. Seventy two stocks ended unchanged. All the sectoral indices slipped sharply. BSE Realty dropped 7.36% followed by BSE Teck (down 5.02%), BSE Power (down 4.44%), BSE Metal (down 4.36%), BSE IT (down 4.04%) and BSE CG (down 3.86%).
Most of index heavyweights witnessed heavy correction. Among majors, Satyam Computer Services tumbled 30.22% at Rs158.05, Reliance Infrastructure dropped 13.73% at Rs549.15, Reliance Communications moved down by 13.36% at Rs202.70, and JP Associates lost 12.11% at Rs76.95. Other frontline stocks lost between 1-9% each. Select counters, however, bucked the downtrend and ended with gains. ICICI Bank advanced 2.43% at Rs431.80 and HDFC Bank moved up by 1.83% at Rs1,002.05, while Infosys, Wipro, Hindustan Unilever Ltd, Mahindra & Mahindra, Grasim Industries, ONGC and Maruti Suzuki India ended with modest gains.
Realty stocks were hit hard and dropped sharply. India Bulls Realestate crumbled by 11.13% at Rs131.30, Orbit Corporation lost 10.57% at Rs60.10, Unitech shed 9.11% at Rs34.90 and DLF declined by 8.64% at Rs253.20. Mahindra Life Science, Ansal Properties and Infrastructure, Parsvnath Developers and Peninsula Land were down over 6% each.
Over 3.33 crore shares of Satyam Computer Services changed hands on the BSE followed by Reliance Natural Resources (2.27 crore shares), HDIL (1.99 crore shares), Suzlon Energy (1.61 crore shares), Unitech (1.30 crore shares) and GVK Power & Infrastructure (1.17 crore shares).
Satyam was the most actively traded counter on the BSE and registered a turnover of Rs551 crore followed by Reliance (Rs347 crore), HDIL (Rs305 crore), Reliance Infras
Turnover surges
Nifty December 2008 futures below 3000
Nifty December 2008 futures were at 2941.70, at a discount of 12.65 points as compared to the spot closing of 2954.35. Turnover in NSE's futures & options (F&O) segment surged to Rs 49,360.05 crore, from Rs 39,172.96 crore on Tuesday, 16 December 2008.
DLF December 2008 futures were discount at 250 compared to the spot closing of 253.50.
Satyam Computer Services December 2008 futures were near spot price at 156.75 compared to the spot closing of 157.10.
Infosys Technologies December 2008 futures were near spot price at 1142 compared to the spot closing of 1141.55.
In the cash market, the S&P CNX Nifty lost 87.4 points or 2.87% at 2954.35.
Corporate governance concerns pulls Satyam down
Concerns about a lack of transparency and worries about absence of strict corporate governance practices at Indian firms pulled the market sharply down after India's fourth largest software firm in terms of sales, Satyam Computer Services' aborted attempt to buy two related companies. The BSE 30-share Sensex lost 261.69 points, or 2.62%, shedding 357.81 points from the day's high in what was a choppy trading session.
A 15% fall in excise duty collections in November 2008 which is being attributed to a sharp decline in manufacturing sector also weighed on the market. The government released the indirect tax collection data for November 2008 on Tuesday, 16 December 2008. Fall in Lower European markets and lower US index futures also weighed on the domestic bourses which tumbled in late trade.
Satyam slumped 30.22% to Rs 158.05 on 3.33 crore shares. The stock hit a low of Rs 153.80, a 52 week low for the scrip. Bowing to investor pressure, Satyam called off a deal to buy Maytas Properties and Maytas Infra, the two firms promoted by the family of promoter and chairman Ramalinga Raju. The company made the announcement before trading hours today, 17 December 2008.
Satyam's shares, which closed down $6.85, or 55%, at $5.70 on the New York Stock Exchange, jumped 50% in after-hours trading to $8.89. Even after the evening rally they were still down 28% from Monday's (15 December 2008) close of $12.30. Investors slammed the move by Satyam to buy Maytas Properties for $1.3 billion and a 51% stake in Maytas Infrastructure for $300 a million, as the acquisition could have wiped out its entire nearly $1.2 billion cash pile. Satyam had announced the acquisition after trading hours on Tuesday, 16 December 2008.
The company's total disregard for corporate governance and shareholders was shocking - Satyam had no plan to take the proposal to minority shareholders.
Volatility was high as the market was caught between a steep rate by the US Federal Reserve and concerns over corporate governance standards at Indian firms and worries about the weakening economy. After an early surge triggered by the Fed decision, the market had weakened shortly as India's fourth largest software firm in terms of sales, Satyam Computer Services' aborted attempt to buy two related companies raised concerns about corporate governance standards at Indian firms.
A strong rebound saw the market moving into green in early afternoon trade. It later slipped into the red again. After moving between positive and negative zone, the market weakened in mid-afternoon trade. It extended losses in late trade.
European shares gave up early gains to turn negative on Wednesday, 17 December 2008, after France's biggest bank by market capitalisation BNP Paribas said its investment bank unit had a loss for the first 11 months of the year. The key benchmark indices in France, Germany and UK were down by between 0.07% to 0.85%.
US index futures were lower ahead of Morgan Stanley figures. Trading in US futures indicated the Dow could fall 109 points at the opening bell. Morgan Stanley is expected to report a loss per share of $0.24 compared with a loss of $3.61 last year
The US Federal Reserve on Tuesday, 16 December 2008, slashed its key interest rate to a target rate of zero to 0.25% from 1%, paving the way for other policymakers around the world to take more aggressive actions to support growth.
The Fed also said it would use unconventional means to revive the US economy from a deep recession, including buying long-dated Treasuries. In an all-out battle to protect the US economy from deflation, the Fed explicitly said it would take steps to make sure benchmark rates remain low for some time and to keep its balance sheet loaded with debt.
Asian stocks rose in volatile trade as the steep Fed rate cut raised expectations central banks in the region will follow suit. Key benchmark indices in China, Hong Kong, Singapore, Taiwan, Japan and South Korea were up by between 0.09% to 2.18%.
The BSE 30-share Sensex was down 261.69 points, or 2.62%, to 9,715.29. At the day's low of 9,682.91, the Sensex fell 294.07 points in late trade. The Sensex rose 96.12 points at the day's high of 10,073.10 hit in early trade.
The S&P CNX Nifty was down 87.40 points, or 2.87%, to 2,954.35.
The BSE Mid-Cap index fell 3.33% underperforming the Sensex while the BSE Small-Cap index slipped 2.6% marginally outperforming the Sensex.
The market breadth tuned negative during the course of the day from strong breadth earlier in the day. On BSE, 956 shares rose as compared with 1,569 that declined. 72 shares remained unchanged.
The Sensex is down 10,571.70 points or 52.11% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 11,491.48 points or 54.18% below its all-time high of 21,206.77 struck on 10 January 2008.
The BSE clocked a turnover of Rs 4,882 crore, higher than Rs 4,149.73 crore on Tuesday 16 December 2008.
Nifty December 2008 futures were at 2941.70, at a discount of 12.65 points as compared to the spot closing of 2954.35. Turnover in NSE's futures & options (F&O) segment surged to Rs 49,360.05 crore, from Rs 39,172.96 crore on Tuesday, 16 December 2008.
The BSE Realty index (down 7.36%), the BSE Teck index (down 5.02%), the BSE Power index (down 4.44%), the BSE Metal index (down 4.36%), the BSE IT index (down 4.04%), the BSE Capital Goods index (down 3.86%), the BSE Oil & Gas index (down 2.9%) underperformed the Sensex.
The BSE Bankex (down 0.15%), the BSE PSU index (down 0.79%), the BSE Auto index (down 0.81%), the BSE FMCG index (down 0.83%), the BSE HealthCare index (down 1.64%) outperformed the Sensex.
The BSE Consumer Durables index fell 2.62% to the same extent at which the Sensex fell
Tata Power Company, Jaiprakash Associates, Sterlite Industries and Tata Steel fell by between 4.45% to 12.91%.
While Satyam tumbled, other IT stocks rose boosted by the steep Fed rate cut and as funds reshuffled portfolio. India's second largest IT exporter by sales Infosys rose 1.51% to Rs 1,139.80. India's fourth largest IT exporter by sales Wipro rose 1.5% to Rs 243. India's largest IT exporter by sales Tata Consultancy Services fell 0.76% to Rs 477.10 off the day's high of Rs 494.
Investors dumped Satyam and used the funds to buy other IT pivotals in a bid to stick to their exposure to the Indian IT sector. ]
Accentia Technologies rose 2.14% after it secured an order worth $ 22 million to service a chain of hospitals in the US.
The aggressive Fed cut also helped IT stocks shrug off a firmer rupee. Indian IT firms derive a lion's share of revenue from exports to the US. The Indian rupee traded close to one-month highs in afternoon trade on Wednesday, buoyed by the Fed rate cut and broad weakness in the dollar against other major currencies overseas. The partially convertible rupee was at 47.32/35 per dollar, stronger than its previous close of 47.92/93. It touched a high of 47.22, the highest since 10 November 2008.A stronger rupee affects IT firms negatively as they earn most of their revenues from exports.
India's largest private sector company by market capitalization and oil refiner Reliance Industries (RIL) fell 2.64% to Rs 1,350.15 on profit taking after a recent solid surge. From the recent low of Rs 1,118.60 on 5 December 2008 the stock had jumped 10.68% to Rs 1,238.15 on 16 December 2008.
India's largest oil exploration firm by revenue ONGC rose 0.39% as crude oil prices advanced on expectations the oil cartel the Organisation of Petroleum Exporting Countries (OPEC), will cut supplies further at an official meeting in Algeria today, 17 December 2008.
Oil prices rose for the first time in four days on Wednesday, 17 December 2008, as a global stock rally continued after the US Federal Reserve cut its benchmark interest rate to a record low and pledged to do more to revive the world's biggest economy. Crude oil for January 2009 delivery climbed as much as 90 cents to $44.50 a barrel.
PSU OMC stocks rose on recent reports the government is considering a proposal to de-regulate the pricing of petrol and diesel. Hindustan Petroleum Corporation rose 3.8% on reports it is in talks with two overseas oil firms for joint participation in the $10 billion refinery-cum-petrochemical project at Vizag in Andhra Pradesh. BPCL jumped 0.52%. But Indian Oil Corporation slipped 0.34%.
The proposed deregulation of fuel prices, will provide full freedom to oil companies to set petrol and diesel prices.
Some FMCG stocks rose on defensive buying. Nestle India, Hindustan Unilever, Marico, United Breweries rose by between 0.55% to 1.27%. But India's largest cigarette maker by sales ITC fell 2.3%.
Real estate stocks slipped on reports recent rate cuts on housing loan and extra spending announced by the government on 7 December 2008 are not enough to spur demand. DLF, Indiabulls Real Estate and Unitech fell by between 8.64% to 11.13%. State-run banks on 15 December 2008, announced lower interest rates on small home loans.
Banking shares gained on hopes lower interest rates will boost lending growth. India's second largest private sector bank by net profit HDFC Bank rose 1.83% as its American depository receipt (ADR) gained 11.63% on Tuesday 16 December 2008. Its advance tax payment fell 10.7% to Rs 250 crore in Q3 December 2008 over Q3 December 2007. India's largest private sector bank by net profit ICICI Bank rose 2.43% as its ADR rose 11.07% on Tuesday. Its advance tax payment declined 6% to Rs 470 crore in Q3 December 2008 over Q3 December 2007.
India's largest commercial bank State Bank of India (SBI) fell 2.98% to Rs 1201.25 off day's high of Rs 1,256 even as its advance tax payment rose 56% at Rs 1,700 crore in Q3 December 2008 over Q3 December 2007.
The Reserve Bank of India (RBI) on 6 December 2008, announced a 100-basis point cut in the repo rate and the reverse repo rate each. Repo rate is the rate at which RBI lends to commercial banks and reverse repo rate is the rate at which RBI accepts deposits from banks.
Auto stocks were mixed on hopes recent price cuts and lower interest rates would boost demand for vehicles which is mainly driven by finance. Mahindra & Mahindra and Maruti Suzuki India rose by between 0.27% to 1.25%. Hero Honda Motors and Tata Motors fell by between 0.95% to 1.73%.
Bharat Forge rose 0.59% on reports the company and European power equipment giant Alstom have finalized the site for setting up a manufacturing facility for power equipments.
Kesoram Industries declined 7.29% on shutting its tyre manufacturing unit in Orissa for 14 days to avoid inventory pile up and debtors due to the shutdown of operations by auto majors.
Capital goods stocks fell on worries a slowing economy will crimp orders. Larsen & Toubro and Bharat Heavy Electricals fell by between 3.32% to 4.37%.
Metal stocks declined on worries a weakening domestic and global economy will hit demand. Tata Steel, Hindalco Industries, Sterlite Industries, Steel Authority of India, National Aluminum Company fell by between 2.63% to 8.77%.
India's largest cement maker by sales ACC fell 9.21% on shutting one of its kilns at Gagal in Himachal Pradesh.
Anil Dhrubai Ambani group shares Reliance Communications, Reliance Infrastructure, Reliance Capital and Reliance Natural Resources fell by between 11.53% to 16.01% on reports the government is seeking details of an alleged misuse of accounts of Reliance Infrastructure and Reliance Natural Resources by some former UBS employees.
Gremach Infrastructure Equipments & Projects was locked at upper limit of 5% to Rs 25.90 on BSE, extending gains for the third day in a row, ahead of a board meeting to consider right issue.
Gammon Infrastructure Projects rose 1.43% on achieving financial closure of its offshore container terminal project in Mumbai.
ABG Shipyard fell 7.58% on reports the firm is likely to see cancellation of orders worth around Rs 1000 crore due to one of its prospective buyers facing a financial crunch.
Country Club India rose 3.33% ahead of its board meeting on 19 December 2008 to consider rights issue of equity shares.
Satyam Computer Services clocked the highest volume of 3.34 crore shares on BSE. Reliance Natural Resources (2.27 crore shares), Housing Development & Infrastructure (1.99 crore shares), Suzlon Energy (1.62 crore shares) and Unitech (1.3 crore shares) were the other volume toppers in that order.
Satyam Computer Services clocked the highest turnover of Rs 551.74 crore on BSE. Reliance Industries (Rs 347.29 crore), Housing Development & Infrastructure (Rs 305.36 crore), Reliance Infrastructure (Rs 165.44 crore) and Educomp Solutions (Rs 160.42 crore) were the other turnover toppers in that order.
Pre Session Commentary - Dec 17 2008
Today we expect markets to open positive amidst gain in US markets and phenomenal openings across the Asian markets. The Federal Open Markets Committee’s (FOMC) decision of reducing the key lending rate has brought charm in the markets around the world. The FOMC has stated that it is targeting to reduce the Fed’s fund rate to 0 to 0.25%. In a major incidence in the IT industry, Satyam has walked away from the $1.6 billion deal of buying Maytas Properties and Maytas Properties due to investors’ concerns. The domestic markets are likely to follow the global trend today. Despite the volatility that the markets had shown yesterday, today we expect the markets to trade firm with a positive trend.
On Tuesday, the markets traded volatile until it managed to gain after the post mid session. The lackluster markets of Asia had little impact on the domestic sentiments as the front like stocks like Reliance Industries, ONGC, ACC and HDFC Bank helped gain over all momentum. The second line stocks also rallied with strong sentiments for the consecutive day. Sensex crossed the psychological level of 10k and on the other hand Nifty managed to close above 3k mark. The UK markets like CAC, FTSE and Dax also rallied on the back of positive cues of rate cut by Fed. Sensex and Nifty gained by 1.47% and 2.03%. CD, PSU and Oil & Gas gained 7.44%, 5.03% and 3.30% respectively. The rest of the sectors also managed to close in green. During the trading session we expect the market to be trading with a positive trend.
The BSE Sensex closed higher by 144.59 points at 9,976.98 and NSE Nifty ended up by 60.55 points at 3,041.75. The BSE Mid Caps and Small Caps ended with good gains of 79.14 points and 117.56 points at 3,244.21 and 3,776.65 respectively. The BSE Sensex touched intraday high of 10,009.21 and intraday low of 9,790.31.
On Tuesday, the US markets closed in red. Despite the financial giant posted worst than expected quarterly results the markets managed to close in green on the back of the FOMC’s decision to reduce the key lending rates to 0 to 0.25%. The FOMC has stated that it is targeting to reduce the Fed’s fund rate to 0 to 0.25%. The November CPI has also declined below the expectations by 1.7%. On the other hand there are also rumors about automaker’s bailout which could be announced today. Crude oil futures for the month of January delivery fell $0.91 to $43.60 per barrel on New York Mercantile Exchange. The crude futures dropped to a low to $42.56 a barrel in the electronic trading on the back of the Federal Reserve''s comprehensive easing steps and gloomy economic outlook overtook expectations that the Organization of Petroleum Exporting Countries will cut member nations'' production quotas.
The Dow Jones Industrial Average (DJIA) closed higher with 359.61 points at 8,924.14 NASDAQ index gained 81.55 points at 1,589.89 and the S&P 500 (SPX) also closed higher by 44.61 points to close at 913.18 points.
Indian ADRs ended mixed. In technology sector, Infosys gained by 0.80% and Wipro also gained by 3.78% followed by Satyam that lost a whopping 54.58% and Patni Computers closing high by 2.38%. In banking sector ICICI Bank gained 11.07%, while HDFC Bank gained 11.63%. In telecommunication sector, Tata Communication inclined by 11.52%, while MTNL inclined by 1.80%.
Today the major stock markets in Asia opened positive. The Shanghai Composite is trading high by 24.92 at 1,999.93 Hang Seng is high by 168.16 points at 15,298.37. Further Japan''s Nikkei is high by 8.67 points at 8,576.69. South Korea’s Seoul Composite is low by 1.11 points at 1,160.45 and Singapore’s Strait Times is high by 10.38 points at 1,792.47.
The FIIs on Tuesday stood as net buyers in equity and net sellers in debt. Gross equity purchased stood at Rs 1798.60 Crore and gross debt purchased stood at Rs 113.40 Crore, while the gross equity sold stood at Rs 1559.20 Crore and gross debt sold stood at Rs 161.50 Crore. Therefore, the net investment of equity and debt reported were Rs 239.40 Crore and Rs (48.10) Crore respectively.
On Tuesday Indian Rupee closed at 47.92/93 a dollar, 0.3% stronger than Monday''s close of 48.05/06. The rallies in the capital markets have helped the Rupee gain strength despite huge demand for dollars by state run banks on behalf of Oil refineries.
On BSE, total number of shares traded were 37.80 Crore and total turnover stood at Rs 4,149.73 Crore. On NSE, total number of shares traded were 77.61 Crore and total turnover was Rs 11,116.37 Crore.
Top traded volumes on NSE Nifty – Unitech with 47429681 shares, Suzlon Energy with total volume traded 42000652 shares, followed by SAIL with 20463821 shares, Reliance Petro with 17131397 shares and DLF with 12238912 shares.
On NSE Future and Options, total number of contracts traded in index futures was 861407 with a total turnover of Rs 12,045.03 Crore. Along with this total number of contracts traded in stock futures were 997927 with a total turnover of Rs 10,548.77 Crore. Total numbers of contracts for index options were 1055038 with a total turnover of Rs 15,790.09 Crore and total numbers of contracts for stock options were 67880 and notional turnover was Rs 789.07 Crore.
Today, Nifty would have a support at 2,950 and resistance at 3,105 and BSE Sensex has support at 9,819 and resistance at 10,225.
Market may edge higher on a steep Fed rate cut
A rally in Asian stocks triggered a steep interest rate cut by the Federal Reserve will boost the domestic bourses at the onset of the trading session. The market may heave a sigh of relief by in a dramatic turn of events India’s fourth largest software firm by revenue, Satyam Computer Services called off a deal to buy Maytas Properties and Maytas Infra.
Asia stocks rose after the Federal Reserve on Tuesday, 16 December 2008, cut rates to a record low, paving the way for regional policymakers to take more aggressive actions to support growth. The Fed slashed its key interest rate to a target rate of zero to 0.25%. Fed also said it would use unconventional means to revive the US economy from a deep recession, including buying long-dated Treasuries.
In an all-out battle to protect the US. economy from profit-evapourating deflation, the Fed explicitly said it would take steps to make sure benchmark rates remain low for some time and to keep its balance sheet loaded with debt. US stocks closed 5% higher after the Fed decision.
Meanwhile in dramatic turn of events, Satyam Computer, bowing to investor pressure, cancelled a deal to acquire Maytas Properties and Maytas Infra, the two firms promoted by the family of promoter and chairman Ramalinga Raju. Satyam's shares, which closed down $6.85, or 55%, at $5.70 on the New York Stock Exchange, jumped 50% in after-hours trading to $8.89. Even after the evening rally they were still down 28% from Monday's (15 December 2008) close of $12.30.
Investors had slammed the move by Satyam to buy Maytas Properties for $1.3 billion and a 51% stake in Maytas Infrastructure for $300 a million, a move which could have wiped out its entire nearly $1.2 billion cash pile. Satyam had announced the acquisition after trading hours on Tuesday
Indices may open positive
The market is likely to display positive trend as fund inflows continues into the domestic equities and players are maintaining their bets on large caps, banking and energy counters. However, the market is likely to witness cautious trend as the major Asian indices are trading flat in the ongoing trades and intra-day volatility remains the major factor. Among the local indices, the Nifty could test the 3100-3150 range on the upside while on the down side it could find support at 3000 and 2950. The Sensex is likely to get support at 9850 and may face resistance at 10100.
Major US indices registered significant gains on Tuesday after the Federal Reserve cut a key short-term interest rate to the lowest level on record, and signaled it had more tools available to help the economy as the recession stretches on.While the Dow finished with the gains of 360 points at 8924 and the Nasdaq moved up by 82 points to close at 1590.
Except Satyam which fall sharply with loss of over 54% all the Indian ADRs traded firm on the US bourses. ICICI Bank, VSNL & HDFC Bank led the pack with gains of 11% each while Dr Reddy, Rediff, Wipro, Tata Motors and Inosys jumped over 1-4% each.
Crude oil prices declined, with the Nymex light crude oil for January delivery losing by 91 cents to close at $43.60 a barrel. In the commodity space, the Comex gold for February delivery gained $6.20 to settle at $842.70 an ounce.
Tanla Solutions
Investors with a short-term trading perspective can consider buying Tanla Solutions stock. It is apparent from the charts of Tanla Solutions that it has been on a long-term downtrend from its life high of Rs 410 touched in January. The stock has been forming lower peaks and lower troughs since then. In September, the stock broke through a significant support level at Rs 200 and its downtrend accelerated. It, however, found support at Rs 54, recording an all-time low in late November and reversed direction. Positive divergence in the daily and weekly relative strength index (RSI) supports the stock’s recent reversal. On December 12, the stock surged 16 per cent, penetrating its 21-day moving average. We observe that there is an increase in volume over the past three sessions. The daily RSI has entered in the bullish zone from the neutral region. Our short-term forecast for the stock is bullish. We anticipate the stock to move up until it hits our price target of Rs 103 in the upcoming trading sessions, while maintaining a stop-loss at Rs 86.
via BL
Gold turns down as euro slips after poor PMI numbers
Strength in oil & dollar results in tight activity in gold
Gold futures weakened as the US dollar rose against the single currency after the Euro Zone manufacturing and the Services PMI fell in December 2008. The late recovery in the Asian and the London markets also pulled the bullion lower despite appreciation in the Yen.
The U.S. stock-market futures pointed higher Tuesday ahead of an interest-rate decision from the Federal Reserve and the latest quarterly earnings from Goldman Sachs Group. The policy-making Federal Open Market Committee is almost universally expected to cut its target for overnight interest rates to 0.5% from 1%. On its own, that cut isn't expected to have much of an impact, so investors will also be looking for indications on whether the Fed will take other steps, such as injecting more cash into the economy.
An ounce of Gold on the COMEX Division of the New York Mercantile Exchange lost over $ 5 at $ 731.7 an ounce in the late electronic session. The trades were anyways quite lethargic with mild strength in oil and dollar countering the movement in the bullion.
Whereas, February MCX Gold futures rebounded from Rs 12830 the level we had mention in the morning update. Recently it was seen trading at Rs 12854 down nearly Rs 40 per 10 grams. The open interest of the counter also shed 235 lots or 2.13% at 14013 lots. On the economic agenda other than the Fed decision today is the November consumer price index and US housing data.
In the currency movements the single currency dipped against the US dollar after the manufacturing PMI dropped to 34.5 in December from 35.6 in November, while activity in the services sector has edged down to 42.0 from 42.5 in November. The dollar declined against the yen, but stepped higher against the euro ahead of the data and rate decision. The greenback fell 0.5% to 90.04 yen, while the euro lost 0.4% at $1.3642.
Trading Calls - Dec 17 2008
Nifty (3042) Sup 2975 Res 3105
Buy NTPC (174) SL 170
Target 182, 183
Buy Titan (924) SL 916
Target 940, 945
Buy ABB (440) SL 435
Target 450, 452
Buy HDFC Bank (985) SL 976 Target 1003, 1110
Sell Sun TV (157) SL 160
Target 151, 149
Daily News Roundup - Dec 17 2008
Kingfisher Airlines and Jet Airways are contemplating another round of fare cut. (ET)
ONGC loses over Rs15.7bn during 2007-08 on selling gas below cost. (ET)
United Breweries planning to bid for Cobra Beer. (ET)
Suzlon and Martifer Group have revised the payment schedule for the latter 22.4% stake in REpower. (BS)
Nagarjuna head sent to judicial custody for allegedly defaulting payment to NFL depositors. (BS)
ABG Shipyard faces Rs10bn order cancellation as the prospective Norwegian buyer is facing financial crunch. (BS)
Tata Motors may tap car loan pool to raise fund. (BS)
L&T secures order worth Rs13.7bn from three different steel companies for engineering related works. (FE)
IVRCL Infra has bagged four order worth Rs746bn from different agencies for construction related projects. (FE)
Birla Tyres shut down its OEM unit at Balasore in Orissa. (BL)
Elder Pharma has tied up with Australian Pharma Company Global Energy Medicines to market pain management product in India. (ET)
HDIL plans to enter the sub Rs2mn home category. (ET)
Reliance Infra has bagged project worth Rs1.8bn from Haryana government. (BL)
Bharat Forge and Alstom to set up manufacturing facility with an annual capacity of 5,000mw at Mundra port. (BL)
SBI is planning to raise Rs180bn through bonds by December 2010. (BL)
Union Bank plans to raise Rs5bn via bonds. (BL)
Moser Baer to have an exclusive home video license for UTV’s 25 films for the next five years. (ET)
The empowered committee of state finance minister has opposed the idea of granting declared good status to ATF. (BL)
Jewellery exports down 34% yoy to US$987mn in November.
Finance Ministry backs the plan to limit 3G auction to five players per circle for private companies and state owned telcos. (ET)
Government may scrutinize Satyam deal if there is violation of company law. (ET)
Government plans Rs100bn fund to extend low cost credit for shipping industry for purchasing new vessels. (ET)
Revenue from excise and custom duty decline by 15% and 0.8% in November, respectively. (ET)
FDI inflow declines 26% yoy in October this year. (ET)
Government may take more step to boost growth in economy and protect it from the global downturn, says Chidambaram. (ET)
Planning commission deputy chairman says the fiscal stimulus package announced by the government was adequate. (ET)
Chidambaram hints a cut in fuel prices again. (BS)
Reversing the reverse!
We must expect reverses, even defeats. They are sent to teach us wisdom and prudence, to call forth greater energies, and to prevent our falling into greater disasters.
A disaster seems to have been averted at Satyam Computer. The IT major has decided to drop the proposed acquisition of two promoter group companies - Maytas Properties and Maytas Infra, which is Satyam spelt in reverse. The reverse also has a reverse side and the Satyam management (involved in the deal) has taken heed of the screams of investors.
The bulls may continue the recent run of good form today as well following the Federal Reserve's move to slash interest rates to near zero level. US shares ended sharply higher on the central bank's promise to do more in order to check the economic slump. The Dow gained 4.2% while the Nasdaq and the S&P 500 rallied well over 5%. European stocks too closed higher while Asian indices this morning too are on a strong wicket. Given the backdrop of a worldwide rally and resumption in FII inflows, we see the Indian market opening firm today. Having said that, Tuesday's advance came on lower volume and turnover. Buying from foreign funds was negligible while local institutions were marginal net sellers. The key indices could take a pause after rising sharply over the past few sessions.
US stocks rallied on Tuesday after the Federal Reserve cut its key interest rate to almost zero and said that it expects to keep rates near the unprecedented low level for some time to come.
The Fed also said it would buy large amounts of debt and securities to flood the financial system with money. The US central bank's campaign to save the US economy involves an array of new economic measures to stimulate spending.
Climbing nearly 400 points in the wake of the Fed decision, the Dow Jones Industrial Average closed at 8,924.14, up 359.61 points, or 4.2%. All of the Dow's 30 components posted gains, fronted by the blue-chip index's financials. Citigroup gained 11.2%, while JPMorgan Chase climbed 13%.
The S&P 500 Index gained 44.61 points, or 5.1%, to 913.18, with financials, telecom services and consumer-discretionary sectors leading gains that included all 10 of the index's industry groups.
Leading the rise among the S&P's financials, XL Capital climbed 26.9%, while shares of Genworth Financial rose 24.6%. The insurer last week said that it would acquire a large community bank in Minnesota, giving it access to a potential government investment.
The technology-laden Nasdaq Composite Index advanced 81.55 points, or 5.4%, to 1,589.89.
Goldman Sachs reported its first quarterly loss since going public in 1999. The investment bank said it lost US$2.1 billion, or US$4.97 a share, versus a profit of US$3.2 billion, or US$7.01 a share, a year ago. Results were worse than expected. Despite the report, shares gained 14%.
Best Buy reported weaker earnings versus a year ago that nonetheless beat forecasts and stronger sales versus a year ago that also topped expectations. The retailer said it may have to announce more layoffs and slow its new U.S. store openings. Shares gained almost 18%.
In other news, the government could announce a plan to help the troubled automakers as soon as Wednesday. The Bush administration said last week that it would consider offering General Motors and Chrysler bridge loans from the US$700 billion bailout fund Congress set aside for Wall Street.
Housing starts and building permits fell to record lows in November, the latest sign that the market has not yet reached bottom. Housing starts plunged more than 19% to an annual rate of 625,000 in November, the Commerce Department reported, while building permits slipped to an annual rate of 616,000. Both results were worse than what economists had expected.
Another report showed weaker consumer inflation than had been expected. The Consumer Price Index (CPI) fell 1.7% in November, after sliding 1% in the previous month. Economists thought CPI would fall 1.3%. The so-called core CPI, which strips out volatile food and energy prices, was flat versus forecasts for it to rise 0.1%. Core CPI dropped 0.1% in the previous month.
Treasury prices rose, lowering the yield on the benchmark 10-year note to 2.28% from 2.50% on Monday. The 10-year yield dipped below 3% in November for the first time since the note was first issued in 1962.
Lending rates improved. The 3-month Libor rate slipped to 1.85% from 1.87% Monday, according to Bloomberg. The overnight Libor rate edged up to 0.16% from a record low of 0.12%. Libor is a key bank lending rate.
The dollar fell to an 8-week low versus the euro and hovered near a 13-year low against the yen.
US light crude oil for January delivery fell 91 cents to settle at US$43.60 a barrel after rallying in the morning on bets that OPEC will cut output during its meeting in Algeria on Wednesday. COMEX gold for February delivery gained US$6.20 to US$842.70 an ounce.
Gasoline prices rose one-tenth of a cent to a national average of US$1.661 a gallon, according to a survey of credit-card swipes released Tuesday by motorist group AAA. It was only the third increase in the last 90 days.
European shares ended a volatile session in positive territory on Tuesday, with drugmakers and telecom stocks pacing gains. The pan-European Dow Jones Stoxx 600 index rose 0.8% to close at 199.01 after swinging between gains and losses through the session.
Germany's DAX 30 index rose 1.6% to close at 4,729.91, while the French CAC-40 index advanced 2.1% to finish at 3,251.66 and the UK's FTSE 100 index climbed 0.7% to end the session at 4,309.08.
The BSE benchmark Sensex extended gains on Tuesday hitting the 10,000 mark after 22 sessions towards the fag end of trading session.
The banking and the realty stocks were among the major gainers on anticipation of the US Fed cutting interest rate in its policy meeting tonight. Also the IT stocks bounced back led by HCL Tech, Infosys and TCS. The BSE benchmark Sensex finally ended at 9,976 adding 144 points and the NSE Nifty index ended 3,041 adding 60 points.
The oil & gas, Pharma, IT and realty stocks were in demand. While, the metals and select capital goods stocks were under pressure.
Market breath was positive, 1,860 stocks advanced against 654 declines, while, 66 stocks remained unchanged.
Among the 30-components of Sensex, 20 stocks ended in the green and 9 stocks ended in the negative terrain, the big gainers were ONGC (7%), Grasim (6.2%), ACC (5.5%) and HDFC Bank (5.2%).
On the other hand, major losers were Sterlite Industries (7%), HDFC (4.1%), Reliance Infra (2.5%), RCom (2.1%) and DLF (1.3%).
Shares of Alok Industries gained by 3% to Rs19 after the company announced that it is in talks with PE funds to sell stake in its retail arm and two of its Mumbai realty projects. The scrip touched an intra-day high of Rs19.7 and a low of Rs18.4 and recorded volumes of over 4,00,000 shares on BSE.
Shares of SRF Ltd surged by over 8% to Rs81 after reports stated that the company has acquired engineering plastics business and industrial yarn business from its group company SRF Polymers for Rs1.5bn. The scrip touched an intra-day high of Rs81.8 and a low of Rs73 and recorded volumes of over 1,00,000 shares on BSE.
PTC India rallied by over 5% to Rs70 after reports stated that the company is set to tie up with power generation companies in a bid to diversify its business. The scrip touched an intra-day high of Rs72.9 and a low of Rs61 and recorded volumes of over 99,00,000 shares on BSE.
Shares of Corporation Bank gained by 1.5% to Rs184 after the company announced that it has raised upper tier-II bonds (Series (I) (1)) for Rs3bn. The scrip touched an intra-day high of Rs188 and a low of Rs180 and recorded volumes of over 9,00,000 shares on BSE.
With the FED to announce its decision on interest rates and also consumer price data to be released in the US, market players would keep a close eye on the overnight developments. It remains to be seen whether the current momentum can be sustained, as the bulls still lack conviction.
BSE Bulk Deals to Watch - Dec 16 2008
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
16/12/2008 505506 AXON INFOTEC SUBHASH CHANDER S 4286 11.19
16/12/2008 590059 BIHAR TUBES PIONEER NIRMAN INDIA PRIVATE L B 100000 69.99
16/12/2008 590059 BIHAR TUBES APL INFRASTRUCTURE PRIVATE LIM S 430000 70.08
16/12/2008 519475 CHORD FOOD P VASUDHAIVA KUTUMBKAM CONS BROK P LTD B 15688 34.15
16/12/2008 519475 CHORD FOOD P SHRAWAN KUMAR GUPTA S 15688 34.15
16/12/2008 530655 GOOD LUCK ST CONSOLIDATED SECURITIES LTD. B 200000 180.56
16/12/2008 530655 GOOD LUCK ST BIHAR TUBES LTD. S 195845 180.70
16/12/2008 532836 GREMAC INFRA GOLDMAN SACHS INVESTMENTS MAURITIUS I LTD S 122931 24.03
16/12/2008 532836 GREMAC INFRA LOTUS GLOBAL INVESTMENTS LIMITED S 102704 24.00
16/12/2008 522217 GUJ APO IND PATEL AJITKUMAR TRIBHOVANDAS HUF B 100000 91.85
16/12/2008 522217 GUJ APO IND AJITKUMAR TRIBHOVANDAS PATEL B 145406 91.75
16/12/2008 522217 GUJ APO IND SWATI AJITKUMAR PATEL B 200000 91.85
16/12/2008 522217 GUJ APO IND MITUL A PATEL S 445406 91.82
16/12/2008 517380 IGARASHI MOT TREE LINE ADVISORS HONG KONG S 80000 12.14
16/12/2008 512585 KARMA ISP POOJA BHARGAVA B 63000 24.02
16/12/2008 512585 KARMA ISP ABHINAV BHARGAVA HUF B 69000 24.02
16/12/2008 512585 KARMA ISP ABHINAV BHARGAVA B 62155 24.02
16/12/2008 512585 KARMA ISP NARESH PREM BHIDDHA S 16950 23.90
16/12/2008 512559 KOHINORFOODS TEMPTATION FOODS LIMITED B 175000 86.00
16/12/2008 511728 KZLEASING DAXABEN V SHAH B 21513 37.70
16/12/2008 511728 KZLEASING DAXABEN V SHAH S 21151 38.32
16/12/2008 523792 MAZDA LTD HSBC BANK MAURITIUS LIMITED S 24148 28.46
16/12/2008 526721 NICCO PARK R RAJIVE KAUL B 25000 38.86
16/12/2008 531769 PFL INFOTECH RAMESHBHAI VAGHJIBHAI SHAH B 35872 4.96
16/12/2008 507864 PIONEER INVE ACME CRAFT PVT LTD S 126200 13.24
16/12/2008 532791 PYRAMID SAIM MUKESH JAIN B 150000 59.71
16/12/2008 530047 RAI SH REK M C S BUILDWELL PVT LTD S 39500 85.00
16/12/2008 502587 RAMA PUL PAP SANJAY KARSANDAS THAKKER S 59106 5.04
16/12/2008 531646 RFL INTERNAT UNIVERSAL CREDIT S 198790 1.20
16/12/2008 531215 RTS POWER CO HETAL RAJESH PATEL B 94504 152.45
16/12/2008 530461 SABOO SOD CH GULF INV SER CO SAOG S 200000 5.78
16/12/2008 531898 SANGUINE MD DWARKESH RESTAURANT PVT LTD B 78550 6.40
16/12/2008 533014 SICAGEN IND COPTHALL MAURITIUS INVESTMENT LIMITED B 505902 4.60
16/12/2008 533014 SICAGEN IND BSMA LIMITED S 505902 4.60
16/12/2008 505196 TIL LIMITED MARBELLOUS TRADING PRIVATE LIMITED B 63000 135.00
16/12/2008 505196 TIL LIMITED WF INDIA RECONNAISSANCE FUND LTD S 91000 135.00
16/12/2008 532765 USHER AGRO HETAL RAJESH PATEL S 112381 111.55
16/12/2008 532824 VIJAYES TEXT HSBC BANK MAURITIUS LIMITED S 412804 5.77
16/12/2008 532360 VINTAGE CARD GAJJARVARSHA B 4000 15.10
16/12/2008 532360 VINTAGE CARD GAJJARVARSHA S 4000 15.90
NSE Bulk Deals to Watch - Dec 16 2008
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
16-DEC-2008,3MINDIA,3M India Limited,RUANNE CUNNIFF & GOLD FARB INC,BUY,76687,927.00,-
16-DEC-2008,ADVANTA,Advanta India Limited,RUANNE CUNNIFF & GOLD FARB INC,BUY,340000,530.00,-
16-DEC-2008,BIRLACORPN,Birla Jute & Industries,RUANNE CUNNIFF & GOLD FARB INC,BUY,824000,118.00,-
16-DEC-2008,FAGBEARING,Fag Bearings India Ltd,RUANNE CUNNIFF & GOLD FARB INC,BUY,352007,240.00,-
16-DEC-2008,FCH,Future Capital Holdings L,RUANNE CUNNIFF & GOLD FARB INC,BUY,512299,158.40,-
16-DEC-2008,FINANTECH,Financial Technologies (I,RUANNE CUNNIFF & GOLD FARB INC,BUY,540000,543.75,-
16-DEC-2008,INFOMEDIA,Infomedia India Limited,RUANNE CUNNIFF & GOLD FARB INC,BUY,242526,75.00,-
16-DEC-2008,JMCPROJECT,JMC Projects (I) Ltd.,RUANNE CUNNIFF & GOLD FARB INC,BUY,594190,70.75,-
16-DEC-2008,KOHINOOR,Kohinoor Foods Limited,TEMPTATION FOODS LIMITED,BUY,175000,86.00,-
16-DEC-2008,MCDHOLDING,McDowell Holdings Limited,RUANNE CUNNIFF & GOLD FARB INC,BUY,414009,57.80,-
16-DEC-2008,NAUKRI,Info Edge (India) Limited,RUANNE CUNNIFF & GOLD FARB INC,BUY,148526,402.00,-
16-DEC-2008,RADICO,Radico Khaitan Limited,RUANNE CUNNIFF & GOLD FARB INC,BUY,764000,60.30,-
16-DEC-2008,SKFINDIA,SKF India Limited,RUANNE CUNNIFF & GOLD FARB INC,BUY,1262500,132.75,-
16-DEC-2008,3MINDIA,3M India Limited,RUANNE CUNNIFF & GOLD FARB INC,SELL,76687,927.00,-
16-DEC-2008,ADVANTA,Advanta India Limited,RUANNE CUNNIFF & GOLD FARB INC,SELL,340000,530.00,-
16-DEC-2008,BIRLACORPN,Birla Jute & Industries,RUANNE CUNNIFF & GOLD FARB INC,SELL,824000,118.00,-
16-DEC-2008,FAGBEARING,Fag Bearings India Ltd,RUANNE CUNNIFF & GOLD FARB INC,SELL,352007,240.00,-
16-DEC-2008,FCH,Future Capital Holdings L,RUANNE CUNNIFF & GOLD FARB INC,SELL,512299,158.40,-
16-DEC-2008,FINANTECH,Financial Technologies (I,RUANNE CUNNIFF & GOLD FARB INC,SELL,540000,543.75,-
16-DEC-2008,IGARASHI,Igarashi Motors India Lim,TREE LINE ADVISORS (HONG KONG) LTD SUB A/CTREE LINE ASIA MA,SELL,80000,12.07,-
16-DEC-2008,INFOMEDIA,Infomedia India Limited,RUANNE CUNNIFF & GOLD FARB INC,SELL,242526,75.00,-
16-DEC-2008,JMCPROJECT,JMC Projects (I) Ltd.,RUANNE CUNNIFF & GOLD FARB INC,SELL,594190,70.75,-
16-DEC-2008,MCDHOLDING,McDowell Holdings Limited,RUANNE CUNNIFF & GOLD FARB INC,SELL,414009,57.80,-
16-DEC-2008,NAUKRI,Info Edge (India) Limited,RUANNE CUNNIFF & GOLD FARB INC,SELL,148526,402.00,-
16-DEC-2008,RADICO,Radico Khaitan Limited,RUANNE CUNNIFF & GOLD FARB INC,SELL,764000,60.30,-
16-DEC-2008,SKFINDIA,SKF India Limited,RUANNE CUNNIFF & GOLD FARB INC,SELL,1262500,132.75,-
Satyam drops deal for builders
Satyam Computer Services Ltd bowed to investor pressure and canceled its plan to buy two builders partially owned by its top executive for $1.6 billion after seeing its stock get slammed.
India's No. 4 software services company said it decided to not go ahead with its proposed acquisition of Maytas Properties and Maytas Infra "in light of the feedback received from the investor community."
"We have been surprised by the market reaction to this decision even though we were quite positive about the merits of the acquisition," Satyam Chairman B. Ramalinga Raju said in a statement. "However, in deference to the views expressed by many investors, we have decided to call off these acquisitions."
Satyam's shares, which closed down $6.85, or 55 percent, at $5.70 on the New York Stock Exchange, jumped 50 percent in after-hours trading.
Earlier on Tuesday the company said it planned to enter India's depressed construction industry by buying all of privately held Maytas Properties for $1.3 billion and 51 percent of builder Maytas Infra for $300 million.
Ramalinga Raju and other insiders hold 36 percent in Maytas Infra and 35 percent in Maytas Properties.
The two are builders that work on infrastructure projects including highways, ports and water treatment systems. Satyam helps develop software for other businesses.
Satyam's clients include General Electric, Nestle, Qantas Airways and Fujitsu Services.
While announcing the deal, Ramalinga Raju had said the move would "de-risk the core business," making his company stronger.
"The two acquisitions pave the way for accelerated growth in additional geographies and market segments," he said.
But analysts had said the acquisitions made little sense at a time when technology outsourcing companies are preserving cash to cope with slowing sales and questioned the motives of Satyam's top executives.
"This is outrageous and very frustrating," said Jefferies & Co analyst Sachin Jain. "This clearly raises questions about what kind of corporate governance you have in other Indian companies. That could hurt foreign investment."
JP Morgan had cut its recommendation on the stock to "underweight" from "overweight" and slashed its price target to 175 rupees ($3.68) from 475 rupees. Janney Montgomery Scott cut its recommendation to "neutral" from "buy," while S&P Equity Research reduced its rating to "hold" from "buy."
"We see this as a serious corporate governance issue and believe investors should avoid the stock," JP Morgan said in a note to clients.
via Reuters
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