Market set to open in green tracking positive global cues

The key benchmark indices may open higher tracking positive global cues and on bargain hunting after the recent fall in stock prices. From a recent closing high of 15,466.81 on 10 July 2009, the BSE Sensex has lost 2,066.49 points or 13.36% to 13,400.32 on Monday, 13 July 2009. Investors will also take cues from the quarter ended June 2009 results of India Inc. HDFC Bank, PFC, Jubilant Organosys, Piramal Life, Rallis India, Sintex Industries, J&K Bank will be announcing their quarter ended June 2009 result today.

The market has entered a crucial period of earnings. The market expectations are that in Q1 June 2009, the 30 stocks that comprise Mumbai's benchmark Sensex index could see an annual fall in sales of 4-8% and fall in profit at between 9-13%.

Asian stocks rose today, as Posco raised its production target and Singapore upgraded its forecast for economic growth. The key benchmark indices in China, Hong Kong, Japan, South Korea, Singapore and Taiwan rose by between 0.62% to 2.22%.

Posco, South Korea's largest steelmaker, said 2009 output may be 6.4% higher than forecast. Singapore's gross domestic product will shrink between 4% and 6% this year, less than an earlier forecast for a contraction of as much as 9%, the trade ministry said today.

The Wall Street rebounded yesterday, 13 July 2009 led by financials after an upgrade for Goldman Sachs by Meredith Whitney. Meredith also indicated solid short-term potential for banks. The Dow gained 185.16 points, or 2.3%, to 8,331.68. The S&P 500 index added 21.92 points, or 2.5%, to 901.05. The Nasdaq Composite Index rose 37.18 points, or 2.1%, to 1,793.21.

Back home, the government has reportedly set in motion plans to create an independent office to manage its debt, divesting the central bank of this duty in a landmark reform as it braces to raise more than Rs 4 lakh crore this year to finance the highest fiscal deficit on record.

An independent debt management office will take away the Reserve Bank of India's (RBI) responsibility of conducting government borrowings, removing the conflict of interest inherent in its role as the setter of interest rates and the banker to the government. A draft bill will be placed before the Cabinet for its approval by the end of this month. Finance minister Pranab Mukherjee has already given his go ahead to this major policy reform that could change the face of the country's debt market.

Meanwhile, India's monsoon rains will increase in the northwest states in the next two to three days, improving prospects for crops including rice, sugar cane and cotton in the country's grain bowl. There may be rain and thundershowers at many places in the states of Punjab, Harayna, Himachal Pradesh and Uttar Pradesh, the India Meteorological Department said today. Falls in the region were 50 percent below average in the week ended 8 July 2009. Deficient rains have caused acreage of all major crops to lag year ago levels, denting prospects for bigger harvests of rice, oilseeds and sugar cane. Prime Minister Manmohan Singh is relying on an increase in farm output to push economic growth back to a 9 percent pace and to meet a poll promise of ensuring food security for poor families.

As per the provisional figures on NSE, the foreign funds sold shares worth Rs 55.9.23 crore and the domestic funds bought shares worth Rs 742.26 crore on Monday, 13 July 2009.