Genius begins great works; labor alone finishes them.
The Dow Jones has reclaimed the 10,000 mark. A spectacular innings by the cricket genius Tendulkar saw him cross the milestone of 17,000 runs, though it failed to get India past the finishing line. Back to the market, the bulls managed to labor enough to end the indices in the green.
There is no finishing line in the stock market one should set realistic targets; which must be reviewed and altered at periodic intervals. After having bounced back from the bear market lows, the market is going through consolidation. That explains the recent spurt in volatility. The trend might continue in the near term as the market figures out a future sans stimulus. Today, the bulls are likely to have a strong opening and hopefully a similar close, thanks to firm global markets.
US stocks rallied, buoyed by Cisco’s upbeat results, RIM’s buyback and encouraging economic reports on jobless claims and productivity. US retailers posted better-than-expected October sales. Starbucks posted improved earnings and JDS Uniphase unveiled a strong sales forecast. The big monthly jobs report is due out in the US later today. European shares rebounded even as the Bank of England expanded its debt purchase program. Both, the BOE and the ECB held their rates unchanged without giving any clues on withdrawal steps.
FIIs were net buyers in the cash segment on Thursday at Rs1.27bn on a provisional basis. The local funds were net buyers of Rs1.99bn, according to figures published on the NSE's web site. In the F&O segment, the foreign funds were net buyers at Rs1.39bn. On Wednesday, the foreign funds were net buyers of Rs137mn in the cash segment. FIIs' net investments in Indian stocks this year is above $14bn.
US stocks jumped on Thursday, with the Dow Jones Industrial Average topping 10,000, after the government reported a bigger-than-expected drop in jobless claims, and a number of retailers reported improved October sales.
The Dow gained 205 points, or 2.1%, closing at 10,005.96. The Nasdaq Composite index climbed nearly 50 points, or 2.4%, to 2,105.32. Both the Dow and Nasdaq saw the biggest one-day percentage gains since July 23. The S&P 500 rose 20 points, or 1.9%, at 1,066.63.
Gains were broad based, with all 30 Dow components rising.
Stocks have been volatile over the past three weeks, with the S&P 500 losing 5% through Wednesday's close on worries that the rally is out of sync with the ongoing recovery. Between March 9 and the peak on Oct. 19, the S&P 500 gained 63%.
Stocks ended mixed on Wednesday after the Federal Reserve held interest rates steady at historic lows near zero and said it will keep them low for an extended period.
The government's weekly jobless claims report and third-quarter productivity report showed that the pace of layoffs is slowing, but employers are still not creating jobs.
The number of Americans filing new claims for unemployment fell to 512,000 last week from 532,000 the previous week, the lowest level since January. Economists expected 522,000 claims, on average.
Continuing claims, a measure of Americans who have been receiving benefits for a week or more, fell to 5.749 million from 5.817 million the week before. Economists thought it would fall to 5.750 million. It was the eighth decline in nine weeks. Although the decline could mean people are running out of benefits.
Separately, the Senate and House both voted on Wednesday to extend unemployment benefits by up to 20 weeks - and extend the homebuyer tax credit. President Obama is expected to sign the bill into law on Friday.
Another economic report showed that worker productivity is up, a good sign for corporate profits, but also further evidence that companies aren't hiring. Third-quarter productivity rose by 9.5% after rising 6.6% in the previous quarter. Economists thought it would fall to 6.5%.
All eyes are on the October unemployment report from the Labor Department, due on Friday. Employers are expected to have cut 175,000 jobs from their payrolls after eliminating 263,000 in the prior month. The unemployment rate, generated by a separate survey, is expected to rise to 9.9% from 9.8% in September.
American consumers remained cautious with their spending last month, with discounters and warehouse clubs seeing the best October retail sales.
After the close on Wednesday, Cisco Systems reported weaker quarterly earnings and revenue that beat estimates. The company's CEO, John Chambers, said current-quarter revenue would top estimates and that business conditions had bottomed at least six months ago. Cisco shares gained 2.8%.
Toyota reported a surprise quarterly profit Thursday and cut its annual loss forecast by over 50%.
Shares of CVS Caremark slumped 21% in active trading after the company warned that 2010 profits at Caremark, its pharmacy benefits management division, are likely to slump by 10% to 12%. The company also said Caremark's CEO is stepping down. Drugstore CVS bought Caremark in March 2007. The news overshadowed the company's bigger-than-expected jump in quarterly profit.
The dollar fell versus the euro and gained against the yen.
US light crude oil for December delivery fell 62 cents to settle at $79.78 a barrel on the New York Mercantile Exchange.
COMEX gold for December delivery climbed $2 to settle at $1,089.30 an ounce.
Treasury prices fell, raising the yield on the 10-year note to 3.53% from 3.52% on Wednesday.
European shares closed with modest gains. After hitting an intraday low of 235.48, the pan-European Dow Jones Stoxx 600 index rose 0.6% to close at 240.52. The index gained 1.8% on Wednesday.
Germany's DAX index gained 0.7% to settle at 5,480.92, while the French CAC-40 index was up 1% at 3,708.73 and the UK's FTSE 100 index advanced 0.3% to end at 5,125.64.
After a solid bounce back on Wednesday, the Indian markets managed to extend gains to second straight trading session. The upswing was seen despite weak cues from the Asian and the European markets. The BSE Sensex regained the 16,000 mark led by the Metals, Realty and the Power stock. Even the Mid-Cap and the Small-Cap stocks were in demand. Technically, the 4,720 levels which acted as a strong resistance for the Nifty in the past failed to act as a resistance.
In the US, The Federal Reserve on Wednesday indicated yet again that it is no hurry to raise interest rates, saying that the US economy remains weak even though the worst recession in decades appears to be winding down. The American central bank reiterated its long-standing stance to keep interest rates exceptionally low for an extended period because it expects only a weak recovery.
The BSE Sensex gained 151 points at 16,063 after touching a high of 16,092 and a low of 15,564. The index opened at 16,926 against the previous close of 16,912. The NSE Nifty advanced 54 points to shut shop at 4,765.
In Asia, the Nikkei in Japan was down 1.3%, while Australia's S&P/ASX ended lower by 0.7% at 4,508. Shanghai SE Composite gained 0.5% and Hang Seng index in Hong Kong fell 0.6%.
In Europe, stocks were in the negative terrain. The FTSE in the UK was down 0.7%, The DAX in Germany was down 0.5% and the CAC 40 index in France was down 0.6%.
Coming back to India, among the BSE sectoral indices, the Metal index was the top gainer, adding 3%, followed by the Realty index that was down 2.5% and the BSE Power index was down 2.5%.
The BSE Mid-Cap index gained 2% and the BSE Small-Cap index was up 2%.
Among the 30-components of Sensex, 23 stocks ended in the red and 7 ended in the positive terrain. Reliance Infra, RCom, Hindalco, Bharti and Tata Steel were among the major gainers.
On the other hand, among the major losers were SBI, ITC, ACC, Infosys and TCS.
Outside the frontline indices, the big gainers in the broader market were Spicetele, IFCI, RCF, Hind Copper and Mundra Port. On the other hand, losers included India Cement, Container Corp, Madras Cement and Power Fin.
Shares of Suzlon surged for the first time in 11 days. After sliding over 34% in the past 10 days, shares of Suzlon shot up by over 13% to end at Rs62.5 on the back bargain hunting witnessed at lower levels.
According to a release on the Bombay stock exchange, Suzlon, the constructor of large wind parks has pledged 1.79% equity shares with Indiabulls Financial Services Ltd.
The stock opened at Rs55.5 and made an intra-day high of Rs63 and a low of Rs55. Total traded volumes stood at 20.9mn shares.
The stock hit 52-week high of Rs145.85 on June 5, 2009 and 52-week low of Rs33.05 on March 12, 2009.
Shares of Maytas Infra were locked at 5% upper circuit at Rs149.45 after the company secured the Pune-Sholapur road contract worth Rs7.9bn from IL&FS Transportation Networks Limited (ITNL). ITNL was awarded the work of 4 laning of Pune-Sholapur section of NH-9 from km. 144.40 to km. 249.00 (104.60 kms) in the state of Maharashtra on a DBFOT (Design, Build, Finance, Operate & Transfer) basis by National Highways Authority of India (NHAI). This project is to be completed in a period of 20 month.
Shares of IFCI surged by over 14% to Rs49.95 after media reports stated that the government has hired a consultant to advise it on future of the company. The consultant will advise the government on its role in IFCI.
Reports also stated that IFCI could be merged with another state-owned financial institution
The stock opened at Rs44 and made an intra-day high of Rs50 and a low of Rs43.5. Total traded volumes stood at 20.4mn shares.
Shares of Aban Offshore erased early losses and ended higher by 4% to Rs1244. The stock slipped sharply from day’s high after media reports stated that the company’s US$200mn QIP may be delayed as the promoters are not willing to dilute their stake at the current market price.
The company needs to pay US$410mn debt by December 2009. Reports also added that the promoters are also weighing other option to raise fund, would also consider selling rigs.
Gvk Power & Infrastructure announced that the Board of directors approved the acquisition of 40.6mn shares being 12% of paid up equity share capital of Bangalore International Airport Limited (BIAL) at a total cost of Rs.4.84bn from Flughafen Zuerich AG through GVK Airport Developers Pvt. Ltd.
The stock ended lower by 2% to Rs47.25, it opened at Rs48 and made an intra-day high of Rs48.8 and a low of Rs45.4. Total traded volumes stood at 5.4mn shares.
Shares of RCF shot up by over 12% to Rs65.9 after reports stated that the company plans to foray in to cement distribution. The company is aggressively negotiating with seven cement manufacturers to enhance the portfolio of its dealers, the company’s Chairman and MD, Mr U. S. Jha was quoted as saying.
RCF posted a net profit of Rs561.2mn for the quarter ended September 30, 2009 as compared to Rs843.7mn for the quarter ended September 30, 2008. Total Income has decreased from Rs26.25bn for the quarter ended September 30, 2008 to Rs18.03bn for the quarter ended September 30, 2009.