Old times never come back and I suppose it's just as well. What comes back is a new morning every day in the year, and that's better.
Good morning. Wish you a bright and prosperous New Year. The world would have sang the popular song Auld Lang Syne to celebrate the start of the new year. The bulls have been waiting for Old Long Sign for some time and would like to forget 2008 in a hurry. Will 2009 be fine? Your guess is as good as mine! The dream of prosperity, need for peace and pursuit of happiness continues.
Our market is one of the very few markets open for trading. So, don't expect much action though some counters may hog the limelight based on newsflow. Traded volume will be fairly low. Since global cues will be virtually missing, the weekly inflation data could prove to be crucial for the day. Inflation is expected to slow from a nine-month low of 6.61%. Any positive surprise could provide some temporary boost.
The BSE Sensex and the NSE Nifty plunged by almost 50% each in 2008. India’s top 20 business houses saw 65% value erosion. A whole host of factors like the collapse of US housing sector, credit crunch, flaring inflation and economic slump kept up the pressure on the bulls through the year. On Wednesday, the key indices cooled led by a fall in RIL and ICICI Bank.
Over the short-term, focus will be on quarterly corporate earnings, as well as the much-awaited second round of stimulus. The RBI is likely to cut rates further, but the timing and the size of the same is uncertain. Reports suggest that the central bank is not inclined to be aggressive this time around. This may disappoint the markets.
Do not lose sight of the global factors, which may yet throw up some negative surprises.
Most Asian markets are shut for New Year Day.
US stocks ended the last trading session of the terrible 2008 with moderate gains, as investors looked forward to a better year ahead. All American financial markets are closed on Thursday for New Year's Day.
The Dow Jones Industrial Average advanced 108 points, or 1.2%, to finish at 8,776, with 25 of its 30 components ending higher. Among the notable blue chip gainers were aluminum giant Alcoa (more than 5%) and Boeing (over 3%).
The S&P 500 index rose 12 points, or 1.4%, to end at 903, and the Nasdaq Composite index gained 26 points, or 1.7%, to 1,577.
For the year, the Dow has slumped nearly 34%, its worst year since 1931, right in the midst of the Great Depression. The S&P 500 index, widely considered as the most representative of the market gauges for tracking US stocks, has lost more than 38%, its worst year since 1937. The Nasdaq Composite is off more than 40%.
More than $5 trillion in wealth vanished out of the S&P alone. But, in the final month of the year, the market has been reclaiming a bit of ground, with the Dow moving up 0.6%, the S&P adding 0.8%, and the Nasdaq gaining 2.7%.
Market breadth was positive. Trading volume picked up in the final hours of trade, with 1.3 billion shares changing hands on the New York Stock Exchange and 606 million shares trading on the Nasdaq. Advancing issues topped decliners by more than 5 to 1 on the NYSE and by more than 3 to 1 on Nasdaq.
By sectors, financials and industrials led among the gainers, rising 3.4% and 2.5% respectively, followed by consumer discretionary and materials, both up about 2.4%.
Late on Tuesday, the Federal Reserve said it will begin buying mortgage securities backed by Fannie Mae, Freddie Mac and Ginnie Mae in early January.
The Financial Times reported that American International Group (AIG) may ask the Fed to ease rules governing its asset disposals. The insurer may ask for bidders to be allowed to pay for more of the assets in shares, rather than cash, to increase competition, the newspaper reported.
Energy related shares gained, meanwhile, as crude-oil prices reversed earlier losses and rallied back above $44 a barrel. Oil futures have tumbled more than 60% this year, the biggest yearly loss since crude started futures trading in New York in 1983.
Gold finished up 1.6% at $884.30 an ounce. The metal's annual gain of 5.5% was its smallest since 2004. The dollar fell against the euro and yen.
Treasury prices plunged, raising the corresponding yield on the benchmark 10-year note to 2.21% from 2.08% on Monday. Yields on the 2-year, 10-year and 30-year Treasurys all hit record lows last week.
Lending rates were mixed. The 3-month Libor rate slipped to a 4-1/2 year low of 1.42% Wednesday, down from 1.44% Tuesday, according to Bloomberg. Libor is a key bank lending rate.
A report showed that US jobless claims unexpectedly fell in the latest week. But the Labor Department cited seasonal volatility, and indeed, the four-week average of claims stood at the highest level since 1982. The number of Americans continuing to receive unemployment benefits surged, however.
European shares closed broadly higher at the end of a dismal year for global markets with banks and pharmaceuticals among some of the gainers.
The UK's FTSE 100 index closed up 0.9% at 4,434.17. Wednesday's gain takes the FTSE's loss for the year to 31.3%, the worst annual performance since the London benchmark was created.
The French CAC 40 index closed up just 0.03% at 3,217.97, giving back most of its earlier gains. All told, the index slumped 42.6% over the course of 2008.
The BSE benchmark Sensex ended on Wednesday at 9,647 losing 69 points and the NSE Nifty index ended at 2,959 down 20 points.
Among the BSE Sectoral indices BSE Bankex index (down 1.2%), BSE Oil & Gas index (down 1%) and BSE Realty index (down 0.5%). On the other hand BSE Consumer Durable index (up 1.5%).
Market breath turned positive, 1,499 stocks advanced against 935 declines, while, 108 stocks remained unchanged.
Among the 30-components of Sensex, 20 stocks were in the red and only 10 stocks ended in the negative terrain.