It's only during an eclipse that the Man in the Moon has a place in the sun.
The bulls have had their place in the sun even as monsoon, moon, sun and stars seem to be hogging the headlines. Monday was the 40th anniversary of the first ever manned moon mission. Meanwhile, the longest full solar eclipse this century will pass over India and China on Wednesday.
Coming to the markets, the fortunes continue to fluctuate depending on whether one is a bull or a bear. Right now, the bulls seem to be holding an upper hand. And, the Finance Minister could be having a quiet smirk now that the Sensex has erased all the post-budget losses. What’s more, the key indices are within striking distance of the highs hit in June.
Milestones may be crossed and new ones will be made. But, valuations have zoomed from the lows struck last year. Sooner or later this factor will put a lid on any unbridled rally, as fundamentals are yet to return to pre-recession levels. The market will remain volatile till news turns ‘good’ on a sustained basis. Today, we expect a cautious start and some profit booking.
Global equity markets appear to be clawing their way back after a brief period of consolidation. The catalyst(s) are not new - a few positive economic reports and better corporate earnings. The big question is whether this momentum can be carried forward? If yes, then for how long? We are bound to meet roadblocks along the way. The moot point is that the market is delicately poised, and is only reacting to daily dose of news (both local and global).
For every good news there is a bad news. It depends on what you choose to focus on. This makes the market vulnerable to wild fluctuations. But, the swings continue to baffle and bamboozle even the smartest of market pundits and traders. The best thing to do would be to act judiciously whether you are buying or selling, as the market could remain choppy for quite a while.
Results Today: BOC India, Chambal Fertilizers, Coromandel Fertilizers, Dalmia Cement, Dr. Reddy's, ING Vysya Bank, Ion Exchange, JB Chemicals, LIC Housing Finance, OBC, Radico Khaitan, Renuka Sugar, TN Newsprint, Thermax, Ultratech Cement, Wipro and Yes Bank.
FIIs were net buyers of Rs5.63bn in the cash segment on Monday on a provisional basis while the local funds were a bit more cautious, putting in Rs1.52bn, according to figures published on the NSE web site. In the F&O segment, the foreign funds were net buyers at Rs2.34bn.
On Friday, the foreign funds were net buyers in the cash segment at Rs2.6bn, as per SEBI data. With this, their net investment in Indian stocks this year has crossed Rs300bn or ($6bn). Mutual Funds were net buyers of Rs7.42bn in the cash segment on Friday.
US stocks rallied on Monday, with the Dow adding more than 100 points and the S&P closing at an 8-month high, as investors welcomed encouraging second-quarter financial reports. Wall Street also got a boost from reports that small business lender CIT has secured private-sector financing to keep it out of bankruptcy.
The Dow Jones Industrial Average jumped 104 points, or 1.2%. Monday's rally pushed the blue-chip index into positive territory (in 2009) for the first time in more than 5 weeks.
The broader S&P 500 index added 11 points, or 1.1%, to close at its highest level in more than 8 months. The tech-heavy Nasdaq added 23 points, or about 1.2%, to stretch to its highest level since early October, or about 9 months.
The major indexes are coming off a positive week. Last week was the Dow and S&P 500's first up week -- and the Nasdaq's second -- in the past five.
The fact that companies haven't come out with the dire earnings that were seen in the first quarter is a positive sign. Investors are looking at incremental changes in the earnings reports to give them a clue as to how companies are placed to rebound when the economy starts to pick up.
A report from Goldman Sachs increased its 2009 target for the S&P 500 index to 1060 from 940, a 13% jump in the index. The report also cautioned that the U.S. economic backdrop represents the most significant risk to our equity market forecast, and that the risk of a double-dip recession is significant.
Stocks hit their recent lows on March 9 of this year and have been struggling higher.
This week, 145 of the S&P 500 companies, or 23% of the broad index, are due to report quarterly results. Among them, 12 Dow components, including American Express, Microsoft, Coca-Cola and Merck, are set to release results.
Texas Instruments reported earnings after the closing bell on Monday. The chipmaker posted sales that fell 27% from the year ago period and net income that plunged 56% from the same quarter a year ago. Compared to the first quarter of 2009, however, sales and profits jumped.
The board of CIT has approved a deal for a $3 billion loan from bondholders in order to stave off a bankruptcy filing, according to published reports. The deal is expected to be announced later on Monday. The small and midsize business lender has been scrambling to raise money after the government said it would not provide it additional bailout funds. CIT received $2.3 billion in aid from the government late last year. CIT shares had lost more than 80% since the beginning of June. On Monday, shares surged 79% to $1.25 per share.
The index of leading economic indicators (LEI) rose 0.7% in June, according a report from the Conference Board. Economists were expecting the index to have risen by 0.5% in June, according to a consensus estimate. LEI rose 1.2% in the previous month.
Treasury prices bounced, with the yield on the benchmark 10-year note falling to 3.61% from 3.64% on Friday.
In currency trading, the dollar lost ground against the euro and British pound. Meanwhile, the greenback edged higher against the Japanese yen, which is considered another safe-haven currency.
US light crude oil for August delivery settled up 42 cents to $63.98 a barrel on the New York Mercantile Exchange.
COMEX gold for August delivery rose $11.30 to $948.80 an ounce.
European shares gained ground for the sixth session in a row on Monday. The pan-European Dow Jones Stoxx 600 index rose 1.2% to 213.24, according to preliminary closing prices.
The UK FTSE index climbed 1.3% to 4,443.62, the French CAC-40 index advanced 1.6% to 3,270.94 and the German DAX index rose 1% to 5,030.15.
Bulls did IT again as the Indian markets started off the week with a bang. The NSE Nifty index ended above the 4,500 levels for the first time since June 16, 2009 led by the technology stocks; even the BSE Sensex shut shop above the 15,000 levels with the index adding up over 900 points in last two trading session.
IT stocks were the flavor of the day as the BSE IT index ended with biggest daily percentage gains since May 18, 2009. The index surged over 7%. TCS led from the front after posting impressive Q1 results. Stocks like Infosys, Wipro and Tech Mahindra were among the other major gainers.
The Realty and Telecom stocks also ended with smart gains. Even the Mid-Cap and the Small-Cap stocks participated in the rally.
The Sensex surged by 446 points or 3% to end at 15,191 after touching a high of 15,209 and a low of 14,854. The index had opened at 14,854 against the previous close of 14,745.
The NSE Nifty shot up by 127 points or 2.9% to shut shop at 4,502.
Asian markets ended in the positive terrain. The Nikkei in Japan was closed, Australia's S&P/ASX ended higher by 1.2% at 4,050. The Hang Seng index rose by 3.7% to 19,502.
In Europe, stocks were trading in the green. The FTSE in the UK was up 1.4% at 4,450. The DAX rose 1.5% at 5,053 and the CAC 40 gained 1.6% at 3,270.
Coming back to India, among the BSE sectoral indices, the BSE IT index was the top gainer, surging by an impressive 7.2%, followed by the BSE Realty index that was up 5.2%. The BSE Teck index rose 4.6% and BSE Bankex index was up 4.3%.
The BSE Mid-Cap index advanced 2.5% and the BSE Small-Cap index rose 2.5%.
Within the Sensex, the major gainers were TCS, Wipro, ICICI Bank, DLF, Infosys, Hindalco, Reliance Industries and JP Associates. Among the major losers were, ITC, RCom, HDFC, Reliance Infra and HUL.
Outside the frontline indices, the top gainers included Gujarat NRE, IFCI, Aban Offshore, BEL, Koutans Retail and Marico.
Among the big losers in the broader market were Petronet LNG, NMDC, Crompton Greaves, Fortis Health, Sun TV and Exide Ind.
Shares of TCS shot up by over 15% to end at Rs500 on Monday registering its biggest single day gains for the first time since the stock was listed on the exchanges in August 2004. During the intra-day trades market capitalization of TCS hit the 1 lakh crore mark.
The stock rallied after the company posted spectacular Q1 earnings beating market estimates with major brokerage firms upgrading the stock rating.
The stock had opened at Rs449 and made an intra-day high of Rs514 and a low of Rs449. Total traded volumes stood at 3.9mn shares on the BSE.
Shares of Kingfisher Airlines surged by over 8% to Rs50.9 after reports stated tha the company plans to consider selling shares via rights issue or follow-on public offer to raise funds, stated reports. The stock opened at Rs47 and made an intra-day high of Rs51.6 and a low of Rs45.7. Total traded volumes stood at 3.2mn shares on BSE.
Shares of Maytas Infra were locked at 5% upper circuit to Rs71.15 after reports stated that the government will consider a strategic sale of Maytas Infra, if the board makes a recommendation. The stock opened at Rs71.15 and made an intra-day high of Rs71.15 and a low of Rs71.15. Total traded volumes stood at 80,000 shares on BSE.
Shares of India Cements surged by over 3.5% to Rs152 after the company’s wholly owned subsidiary, ICL Financial Services Ltd entered into a share purchase agreement with the promoters of Indo Zinc Ltd for purchase of 17,87,700 equity shares of Rs10/- each fully paid up in IZL constituting 39.84% of its paid up equity share capital.
Shares of Petronet LNG slipped sharply after the company’s profit in the first quarter fell 2.8%, missing market estimates. Net income in the three months ended June 30 decreased to Rs1.03bn from Rs1.06bn a year earlier. Net sales in the quarter rose to Rs26.04bn from Rs16.46bn.
The stock fell over 4.5% to end at Rs68.9 after hitting an intra-day high of Rs77 and a low of Rs66. Total traded volumes stood at 2.3mn shares on BSE.
Shares of Financial Technologies surged by over 2.5% to Rs1387. IFCI acquired 5% stake in the present equity share capital of MCX Stock Exchange Ltd from Financial Technologies at Rs35/- per equity share.
Shares of IFCI surged by over 10% to end at Rs50.15. The stock opened at Rs46 and made an intra-day high of Rs50.55 and a low of Rs45.75. Total traded volumes stood at 10.8mn shares on BSE