Part of the secret of success in life is to eat what you like and let the food fight it out inside.
The market is poised to open strong after a three-day slide. We just hope there are no post-lunch hiccups as has been the case in recent times. This week’s fall has come on lower volume and turnover. Technical and derivative indicators do suggest some signs of fatigue after a seven-month rally. However, the overall trend remains upbeat. What we are witnessing is, hopefully, just a brief period of consolidation. So have patience. Endure the current choppy phase and gains are bound to come in future.
The Dow finished up more than 130 points and the Nasdaq staged a late turnaround. Asian markets have gained 1-2%.
Inflation has started inching higher though the stimulus steps may not be reversed anytime soon. Interest rates will be left unchanged next week though the RBI could alter its tone from dovish to a little hawkish.
We wouldn’t want to spoil the party for the Congress. Despite its back-to-back landslide wins (LS and Assembly), one wonders if reforms will get the necessary attention. With opposition in dire straits, we hope the Congress doesn’t get complacent. For now though, the Grand Old Party is firmly in driver’s seat.
FII flows will continue to play a key role. Another positive is that the leverage is pretty low. As Nirmal Jain, Chairman, India Infoline expressed in an article in The Economic Times, the EPS, albeit a different one, of the market is up. The E or Economy is gathering pace. The P or the Political backdrop is getting better. The latest triumph of the Congress in the state polls underlines this trend. Finally, the S or the Sentiment has staged an amazing turnaround. Risk-reward is favourable for the bulls.
Results Today: 3i Infotech, Bata India, Bharat Forge, BHEL, Birla Corp., Century Textiles, Dr. Reddy's, Edelweiss, Gateway Distriparks, GSK Consumer, Greaves Cotton, Gujarat State Petronet, HCC, ITC, Indian Bank, IDFC, ING Vysya Bank, JSW Steel, Kirloskar Oil Engines, MMTC, Mirc Electronics, NTPC, Pantaloon Retail, Punj Lloyd, SKF India, Swaraj Engines, Titan, TVS Motor, Welspun India, Zee Entertainment and Zee News.
FIIs were net sellers in the cash segment on Thursday at Rs4.99bn on a provisional basis. The local funds were net sellers at Rs180.7mn, according to figures published on the NSE's web site. In the F&O segment, the foreign funds were net sellers at Rs14.21bn. On Wednesday, the foreign funds were net sellers of Rs3.92bn in the cash segment. Their net investments in Indian stocks this year has crossed $14bn. Mutual Funds were net sellers at Rs5.58bn on Wednesday.
Blue chip US stocks closed higher on Thursday, as better-than-expected results from four components pushed the Dow Jones Industrial Average above 10,000 again. The Dow gained 132 points, or 1.3%, closing at 10,081.31. The S&P 500 index rose 11 points, or 1%, to 1,092.91. The Nasdaq Composite rose 14 points, or 0.7%, to 2,165.29.
US stocks dipped in early trade, before managing to rebound in late morning. Gains were broad based, with 26 of 30 Dow stocks rising, including 3M, McDonald's, AT&T and Travelers, all of which reported better-than-expected results.
Travelers jumped almost 8% and was one of many financial stocks that gained on the day. The KBW Bank index rose 3.4%.
US stocks have been fluctuating over the last week, with the Dow topping and giving up the 10,000 level and the S&P struggling around 1,100. Both major indexes, as well as the Nasdaq, are at nearly one-year highs.
US stocks tumbled on Wednesday after influential analyst Richard Bove of Rochdale Securities cut his rating on Wells Fargo, sparking a steep selloff in the banking sector. But the selloff proved to be short lived, with investors again using the opportunity to buy on the dips, as has been the trend for months.
US stocks have been on an upswing since bottoming in March at the low point of the financial market crisis. Since hitting a more than 12-year low on March 9, the S&P 500 has risen just short of 60% as of Wednesday's close. Any declines in the period have been moderate, in the 3% to 5% range.
Obama administration "pay czar" Kenneth Feinberg called for the seven biggest federal bailout recipients to cut in half total compensation for their top executives. Additionally, the Federal Reserve proposed a broad overhaul of pay policies at 28 of the largest US banks. The review is part of its effort to temper some of the triggers to the risk taking that exacerbated the credit crisis.
Dow component Travelers said its quarterly profit more than tripled, easily topping analysts' estimates. The insurer also lifted its full-year forecast to a profit of between $5.30 and $5.50 per share. Shares jumped 7.7%.
Fellow Dow component AT&T reported a better-than-expected third quarter profit thanks to the impact of Apple's iPhone, for which it has been the exclusive carrier. Wireless revenue jumped 10% in the quarter. Shares gained 0.6%.
Dow component McDonald's reported higher third-quarter earnings that topped estimates on weaker third-quarter revenue that missed estimates. Shares rose 2%.
3M, also a Dow component, said third-quarter earnings and revenue fell from a year ago, but both were above analysts' estimates. Shares gained 3.2%.
Merck, the fifth Dow component to report Thursday morning, said its earnings and revenue rose from a year ago and topped estimates. Shares of the drugmaker were barely higher.
So far, 167 companies, or 33% of the S&P 500, have reported results. Profits are currently on track to have fallen 19.2% versus a year earlier, according to the latest from Thomson Reuters. Revenue is expected to have dropped over 10% from a year ago.
Microsoft launched the newest version of its operating system, Windows 7. The software titan, a Dow component, is hoping that users who have been running XP for years will switch to the new system - and forgive it for the disappointing performance of Windows Vista in 2007.
Microsoft reports quarterly results on Friday.
Around 531,000 Americans filed new claims for unemployment last week, down from 520,000 the previous week. Economists were expecting a bigger drop, to 515,000. Continuing claims, a measure of those who have been receiving benefits for a week or more, fell to 5.92 million from 6.02 million in the previous week. Economists were expecting claims to fall to 5.97 million.
Separately, the index of leading economic indicators (LEI) rose 1% in September after rising a revised 0.4% in the previous month. Economists thought it would rise 0.8%.
The US Federal Housing Finance Agency's housing price index fell 0.3% in September after rising 0.3% in August. Economists thought it would rise 0.3%.
Treasury prices tumbled, raising the yield on the 10-year note to 3.42% from 3.38% late on Wednesday.
The dollar fell against the euro, weakening again after it fell to a 14-month low. The dollar gained versus the yen. The dollar had risen in the morning, pressuring dollar-traded commodity prices. Prices remained lower in the afternoon, even as the dollar turned mixed.
US light crude oil for December delivery fell 18 cents to settle at $81.19 a barrel on the New York Mercantile Exchange, edging off a one-year high.
COMEX gold for December delivery fell $5.90 to settle at $1,058.60 an ounce. Gold has surpassed records repeatedly this month due to the weak dollar and longer-term worries about inflation.
It was the third straight day of losses for the Indian markets on Thursday. The slide was led by heavy offloading in the Realty, Capital Goods, Banking and the Metals stocks. Even the Mid-Cap and the Small-Cap stocks were beaten down badly
Heavyweights like ICICI Bank, Reliance Industries, L&T and SBI witnessed immense selling which dragged the NSE Nifty to shut below 5,000 and the BSE Sensex fell below 17,000.
Negative cues from the international equity markets further dampened the sentiments on Dalal-Street. Market players further intensified selling on the bourses after the Nifty broke below itsmedium term trend line, which has acted as strong support for the indexsince March 2009. Another notable factor is that the index has closed below its 26-DMA. The immediate support for the Nifty is seen at around 4910-4920 levels.
On Thursday, the BSE Sensex fell 219 points at 16,789 after touching a high of 17,031 and a low of 16,721. The index opened at 17,031 against the previous close of 17,009. The NSE Nifty fell 75 points to shut shop at 4,988.
In Asia, the Nikkei in Japan ended lower by 0.7% at 10,267, while Australia's S&P/ASX ended lower by 0.5% at 4,812. Shanghai SE Composite in China ended lower by 0.6% at 3,051 and Hang Seng index in Hong Kong was down 0.5% to end at 22,210.
In Europe, stocks were in the red. The FTSE in the UK was down 1.4%, The DAX in Germany was down 1% at 5,737 and the CAC 40 index in France slipped 1.5%.
Coming back to India, among the BSE sectoral indices, the Realty index was the top loser, shedding 4.5%, followed by the Capital Goods index that was down 2.7% and the BSE Bankex index was down 2%. Even the BSE Mid-Cap index slipped 2% while the BSE Small-Cap index was down 2%.
On the other hand, BSE FMCG index gained 1% and the BSE IT index added 0.8%.
Among the 30-components of Sensex, 23 stocks ended in the red and 7 ended in the positive terrain. Among the major laggards were JP Associates, DLF, ICICI Bank, L&T, Tata Motors and Reliance Infra.
On the other hand, Infosys, ITC, Bharti Airtel, HUL and M&M were among the major gainers.
Outside the frontline indices, the big losers in the broader market were IRB Infra, Madras Cement, Shriram Transport, Jai Corp and RCF. On the other hand, gainers included Marico, Ashok Leyland, Hind Copper, KSK Energy and Bank of India.
The Wholesale Price Index for 'All Commodities' for the week ended October 10, 2009 rose by 0.1% to 242.2 from 241.9 for the previous week.
The annual rate of inflation stood at 1.21% for the week ended October 10, 2009 as compared to 0.92% for the previous week ended October03, 2009 and 11.3% during the corresponding week ended October 11, 2008 of the previous year.
L&T Q2 net profit was at Rs5.8bn as against Rs4.6bn registering a growth of 26% YoY. The company registered net sales of Rs79.2bn as against Rs77.25 in the same period last year. The company posted other income of Rs2.18bn as compared of Rs1.33bn. EPS was at Rs9.7 versus Rs7.74 per.
The stock was down by 4% to Rs1608. The stock opened at Rs1665 and made an intra-day high of Rs1676 and a low of Rs1595. Total traded volumes stood at 0.84mn shares.
Hindustan Zinc announced its Q2 results with net profit of Rs9.34bn for the quarter ended September 30, 2009 as compared to Rs9.59bn for the quarter ended September 30, 2008.
Total Income has increased from Rs19.71bn for the quarter ended September 30, 2008 to Rs19.72bn for the quarter ended September 30, 2009.
The stock pared partial loss and recovered from day’s low. The stock ended lower by only 1.5% at Rs868. It opened at Rs878 and made an intra-day high of Rs884 and a low of Rs852. Total traded volumes stood at 49,000 shares.
Bhushan Steel announced its Q2 net profit of Rs1.89bn up 33% for the quarter ended September 30, 2009 as compared to Rs1.42bn for the quarter ended September 30, 2008. Total Income has decreased from Rs15.18bn for the quarter ended September 30, 2008 to Rs13.04bn for the quarter ended September 30, 2009.
The stock slipped by 3% to Rs1334. It opened at Rs1375 and made an intra-day high of Rs1400 and a low of Rs1324. Total traded volumes stood at 0.13mn shares.
Biocon announced its Q2 results with net profit after tax of Rs623.6mn up 86% for the quarter ended September 30, 2009 as compared to Rs335.3mn for the quarter ended September 30, 2008. Total Income has increased from Rs2.68bn for the quarter ended September 30, 2008 to Rs3.12bn for the quarter ended September 30, 2009.
The Group has posted a net profit after tax of Rs741.9mn for the quarter ended September 30, 2009 as compared to Rs250.2mn for the quarter ended September 30, 2008. Total Income has increased from Rs4.57bn for the quarter ended September 30, 2008 to Rs5.92bn for the quarter ended September 30, 2009.
Shares of Biocon gained marginally by 0.5% to Rs272. The stock opened at Rs272 and made an intsra-day high of Rs284 and a low of Rs267. Total traded volumes stood at 0.86mn shares.
KEC international won orders from the Middle East (Saudi Arabia) and Africa (Chad) aggregating to Rs4.7bn. In the Middle East (Saudi Arabia), the Company has won two orders totaling to Rs4bn, The scope of the orders includes survey, design, engineering, planning, construction, erection, testing and commissioning.
Shares of KEC International have erased gains and ended lower by 2.5% to Rs574. The stock opened at Rs590 and made an intra-day high of Rs624 and a low of Rs567. Total traded volumes stood at 38,000 shares.
Jubilant Organosys announced that the board of directors approved Hiving off Application Polymers division and Consumer Products division. The board also approved raising capital through issue of equity or equity related instruments upto Rs5bn.
The company also announced its Q2 earnings with revenue for Q2 FY 10 at Rs9.33bn. The EBITDA for the quarter was at Rs1.92bn with EBITDA margins of 20.5%.
The Company posted a net profit of Rs554.9mn for the quarter ended September 30, 2009 as compared to net loss of Rs(243.90)mn for the quarter ended September 30, 2008.
Total Income decreased from Rs6.85bn for the quarter ended September 30, 2008 to Rs6.32bn for the quarter ended September 30, 2009.
The stock plunged over 5% to Rs210. It opened at Rs224 and made an intra-day high of Rs228 and a low of Rs209. Total traded volumes stood at 0.21mn shares.