Monday, March 23, 2009
Post Session Commentary - March 23 2009
Indian market surged during the session to close sharply higher due to the strategic move by the US government by planning to buy $1 trillion of toxic bank assets to help the US financial system. Also the rally in the Asian markets along with positive European markets and higher US index futures contributed to the upward movement of benchmark indices. Further, stocks raised also on buying sentiments of FIIs. On the other hand, recommendation by SEBI’s derivatives panel, for the introduction of the lower value contracts on individual stocks to increase the participation of retail investors in the F&O segments, also boosted the sentiments of the investors.
The market opened today on pleasant note along with all other Asian counter parts. Asian stocks were firm on hopes that the US government efforts will lift lending and relieve the global economic crises. Further, benchmark indices continued their journey on huge buying over the counters. In addition, hopes of relieve in RBI’s monetary policy after fall in inflation to historic low, also lifted the sentiments. Markets extended their gains to around 5% towards the final trading. BSE Sensex jumped more than 5% to end above 9,400 level and NSE Nifty closed above 2,900 level. From the sectoral front, traders on-loaded positions across the sectors. Besides, huge buying was witnessed in Bank, Oil & Gas, Metal, PSU, Power, Teck, Pharma and Capital Good stocks. Mid Cap and Small Cap stocks also followed the same trend.
Among the Sensex pack 29 stocks ended in green territory and 1 in red. The market breadth indicating the overall health of the market remained strong as 1629 stocks closed in green while 899 stocks closed in red and 114 stocks remained unchanged in BSE.
The BSE Sensex closed higher by 457.34 points at 9,424.02 and NSE Nifty ended up by 132.85 points at 2,939.9. BSE Mid Caps and Small Caps closed with gains of 75.38 and 62.54 points at 2,836.54 and 3,176.92 respectively. The BSE Sensex touched intraday high of 9,454.69 and intraday low of 9,040.30.
Gainers from the BSE Sensex pack are Ranbaxy Lab (10.80%), Tata Steel (10.39%), Reliance Infra (9.88%), Hindalco (9.35%), HDFC (8.44%), Reliance (7.56%), ICICI Bank (7.36%), SBI (7.33%) and RCom(6.19%).
Only loser from the BSE Sensex pack is DLF Ltd (2.16%).
On the global markets front the Asian markets which opened before the Indian market, ended higher. Asian stocks rose to two months high on expected US plan to help eliminate banks’ $1 trillion of toxic assets. Shanghai Composite, Hang Seng, Nikkei 225, Straits Times index and Seoul Composite ended higher by 44.39, 613.91, 269.57, 67.16 and 28.56 points at 2,325.48, 13,447.42, 8,215.53, 1,664.08 and 1,199.50 respectively.
European markets which opened after the Indian market are trading in green. In Frankfurt the DAX index is trading up by 64.32 points at 4,133.06 and in London FTSE 100 is trading higher by 55.44 points at 3,898.29.
The BSE Bank stocks advanced by (6.66%) or 269.91 points to close at 4,325.54 on hopes that lower interest rates may improve lending growth. Major gainers are Oriental Bank (9.55%), Axis Bank (9.04%), Punjab National Bank (8.72%), Bank of Baroda (7.97%) and ICICI Bank (7.36%).
The BSE Oil & Gas ended up by (6.40%) or 407.43 points at 6,775.40. Gainers are Reliance (7.56%), Reliance Pet (6.90%), Gail India (6.18%), Cairn Ind (6.10%) and ONGC Ltd (5.35%).
The BSE Metal index closed with increase of (6.31%) or 332.09 points at 5,592.55 on rise in metal prices on London Metal Exchange. Scrips that gained are Jindal Saw (11.22%), Tata Steel (10.39%), Hindalco (9.35%), NMDC Ltd (8.31%) and Steel Authority (8.07%).
The BSE PSU index surged (4.21%) or 209.42 points to close at 5,187.58. Main gainers are Hind Copper (11.61%), Oriental Bank (9.55%), Punjab National Bank (8.72%), NMDC Ltd (8.31%) and Steel Authority (8.07%).
The BSE Power index gained (3.66%) or 62.97 points to close at 1,785.52. Gainers are are Reliance Infra (9.88%), Crompton Greaves (6.54%), Suzlon Energy (6.15%), Reliance Power (4.82%) and Tata Power (4.69%).
The BSE Teck index ended higher by (3.35%) or 58.57 points to close at 1,806.82. Deccan Chr (14.50%), Balaji Tele (9.21%), Tata Comm (8.53%), Idea Cell (7.31%) and Oracle Fin (7.21%) ended in positive territory.
Ranbaxy Lab gained 10.80% as it has received Good Manufacturing Practice (GMP) certificates for its manufacturing site at Paonta Sahib (India) from Medicines and Healthcare products Regulatory Agency (MHRA) of UK and the Therapeutic Goods Administration (TGA), Department of Health and Ageing of the Australian Government.
Hikal Ltd soared 7.44% ahead of meeting on March 25, 2009 for considering a proposal for merger of Hikal Pharmaceuticals Ltd, a wholly owned subsidiary of the Company, with itself pursuant to a Scheme of Arrangement and all matters related and incidental thereto.
Infosys increased by 2.57% on reports the company may bag IT project from government which would run on transaction based pricing model.
DLF Ltd lost 2.16%. The company is planning to acquire DLF Asset Ltd (DAL), the real estate investment trust, which is owned by promoters K P Singh and his family, for an enterprise value (equity plus debt) of around Rs 7,000 crore. The move is aimed at repaying some of DAL’s debt and to bring commercial properties under the flagship company to generate an annual income of around Rs 600 crore in the form of lease rentals from 2009-10. DAL currently earns around Rs 325 crore from lease rentals.
BSE Bulk Deals to Watch - March 23 2009
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
23/3/2009 533022 20 MICRONS ERIEZ FINANCE AND INVESTMENT B 75919 15.57
23/3/2009 533022 20 MICRONS RACHANA BHAVIN SHAH S 75977 15.56
23/3/2009 530499 A K CAPITAL FIRSTRAND IRELAND PLC S 82775 141.92
23/3/2009 532799 AKRUTI CITY OPG SECURITIES P LTD B 688231 1595.80
23/3/2009 532799 AKRUTI CITY OPG SECURITIES P LTD S 688231 1596.53
23/3/2009 531223 ANJANI SYNTH SATYABHAMA CHAMPALAL AGARWAL S 60000 9.40
23/3/2009 500102 BALLARPUR IN BILT PAPER HOLDINGS LTD B 16000000 14.91
23/3/2009 500102 BALLARPUR IN KCT PAPERS LTD S 16000000 14.91
23/3/2009 532485 BALMR LAW IN PRASHANT PATEL B 435950 58.00
23/3/2009 532485 BALMR LAW IN PRASHANT PATEL S 442000 58.04
23/3/2009 500048 BEML LTD FIDELITY FUNDS MAURITIUS LIMITED S 484683 376.02
23/3/2009 533026 CHEMCEL USHADEVI SHAHRA B 130000 5.26
23/3/2009 533026 CHEMCEL VIKSIT ENGINEERING LIMITED S 130000 5.26
23/3/2009 520022 DEN SO INDIA GANDIV INVESTMENT PVT. LTD. B 564850 27.50
23/3/2009 520022 DEN SO INDIA PRASHANT PATEL S 570000 27.50
23/3/2009 520081 EAST C.STEEL MINA PARIKH S 30000 9.78
23/3/2009 532876 EVERONN SYS OPG SECURITIES P LTD B 89434 143.87
23/3/2009 532876 EVERONN SYS OPG SECURITIES P LTD S 89434 144.08
23/3/2009 531137 GEMSTONE INV NAROTAMKUMAR MANANCHAND SWAMY B 15000 22.75
23/3/2009 531137 GEMSTONE INV ARUNA NAROTTAM SWAMI B 20000 22.75
23/3/2009 530263 GLOBAL CAP M UNIFLEX CARRYING CO. P LTD S 149400 18.25
23/3/2009 530263 GLOBAL CAP M CLOCK SIGN TRADING CO. PVT LTD. S 152800 18.25
23/3/2009 506131 INDIA CO VEN ANAND KISHOR SHAH B 12450 204.30
23/3/2009 532081 K SERA SERA YES BANK S 387000 10.49
23/3/2009 511728 KZLEASING KARAN MAHESHKUMAR HADVANI B 15838 73.05
23/3/2009 511728 KZLEASING YOGESH GIRDHARLAL PANDYA S 30000 73.55
23/3/2009 511728 KZLEASING AMI STOCK SHARE BROKERS PLTD S 48684 74.35
23/3/2009 511728 KZLEASING KARAN MAHESHKUMAR HADVANI S 20000 72.65
23/3/2009 516092 PUDMJEE IND LAKSHMINARAYAN REALTIES AND SERVICES LTD S 120500 8.02
23/3/2009 507649 RASOI LTD J L MORISON INDIA LIMITED B 29883 383.42
23/3/2009 507300 RAVALG SUG F OPG SECURITIES P LTD B 1035 4007.14
23/3/2009 507300 RAVALG SUG F OPG SECURITIES P LTD S 1035 3962.99
23/3/2009 505729 SINGER INDI GIRDHARI LAL SINGH B 8030 34.45
23/3/2009 512048 SPLASH MEDIA RITESHRAJENDRAKUMARAGARWAL B 10000 105.09
23/3/2009 512048 SPLASH MEDIA RAJENDRAKUMAR AGARWAL HUF B 15000 97.00
23/3/2009 512048 SPLASH MEDIA MEENARAJENDRAAGARWAL B 15000 97.00
23/3/2009 512048 SPLASH MEDIA RAVISH TAMMANSA KATWA B 15000 97.00
23/3/2009 512048 SPLASH MEDIA NITIN T KATWA B 6538 97.00
23/3/2009 512048 SPLASH MEDIA PRADEEP GUPTA B 60000 105.89
23/3/2009 512048 SPLASH MEDIA BHANUMATIDHARAMRAJGIRI S 60500 105.73
23/3/2009 512048 SPLASH MEDIA KIRIT V DAVE S 45000 97.00
23/3/2009 512048 SPLASH MEDIA TAPAN GANGWAL S 14272 99.69
23/3/2009 531874 VENUS VENT CHANDRA SHEKHAR SUNIL BHATT S 42525 27.18
23/3/2009 531249 WELL PACK PA TUSHAR RAMESHBHAI PATEL B 25000 120.41
23/3/2009 531249 WELL PACK PA TUSHAR RAMESHBHAI PATEL B 30000 120.39
NSE Bulk Deal Watch - March 23 2009
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
23-MAR-2009,EDUCOMP,Educomp Solutions Limited,C D INTEGRATED SERVICES LTD,BUY,95699,1999.04,-
23-MAR-2009,EVERONN,Everonn Systems India Lim,OM INVESTMENTS,BUY,92405,143.63,-
23-MAR-2009,ICSA,ICSA (India) Limited,TRANSGLOBAL SECURITIES LTD.,BUY,251661,72.29,-
23-MAR-2009,KSERAPRO,K Sera Sera Productions L,DIMPALBHAI J. LIMBOD,BUY,636082,10.42,-
23-MAR-2009,PTL,PTL Enterprises Limited,SUNRAYS PROPERTIES & INVESTMENT CO PVT LTD,BUY,11800000,7.10,-
23-MAR-2009,RELIGARE,Religare Enterprises Limi,RANBAXY LABORATORIES LIMITED E,BUY,600000,376.71,-
23-MAR-2009,DHANUS,Dhanus Technologies Limit,RELIANCE CAPITAL ASSET MANAGEMENT LIMITED,SELL,129983,13.13,-
23-MAR-2009,EDUCOMP,Educomp Solutions Limited,C D INTEGRATED SERVICES LTD,SELL,95699,1999.86,-
23-MAR-2009,EVERONN,Everonn Systems India Lim,OM INVESTMENTS,SELL,92405,143.78,-
23-MAR-2009,ICSA,ICSA (India) Limited,TRANSGLOBAL SECURITIES LTD.,SELL,234276,72.18,-
23-MAR-2009,KALINDEE,Kalindee Rail Nirman (Eng,VNR AND CO,SELL,111000,88.34,-
23-MAR-2009,KSERAPRO,K Sera Sera Productions L,DIMPALBHAI J. LIMBOD,SELL,636611,10.52,-
23-MAR-2009,KSERAPRO,K Sera Sera Productions L,YES BANK,SELL,525747,10.48,-
23-MAR-2009,PTL,PTL Enterprises Limited,CONSTRUCTIVE FINANCE PRIVATE LIMITED,SELL,11809676,7.10,-
Market nears 9500
The market exhibited strong optimism on the back of firm Asian indices and triggered a major rally in all sectors. After registering gains of 210 points in the last week, Sensex resumed with a positive gap of 73 points, at 9040. Maintaining its upward bias thereafter, extensive buying in banking, oil & gas, metal and public sector unit stocks saw the index edge past 9400 mark and touch an intra-day high of 9455, up 488 points for the day. Sensex closed for the day with gains of 457 points at 9424. Nifty moved up by 133 points to close at 2940.
Market breadth, the number of advancing shares to declining shares, was exceedingly positive for BSE. Of the 2,642 stocks traded, 1,629 stocks advanced and 899 stocks declined. 114 stocks ended unchanged. Of the 13 sectoral indices, BSE Bankex, the index of banking shares, flared up by 6.66% followed by BSE Oil & Gas (up 6.40%), BSE Metal (up 6.31%) and BSE PSU (up 4.21%). Other indices were up 1-3% each.
Except DLF, other index stocks ended at higher levels. Ranbaxy Laboratories was the day's star performer and shot up by 10.80% at Rs161.05. Among other major gainers, Tata Steel surged 10.39% at Rs194.40, Reliance Infrastructure vaulted by 9.88% at Rs530.60, Hindalco Industries spurted 9.35% at Rs52.05, HDFC jumped by 8.44% at Rs1528.80, Reliance Industries scaled up by 7.56% at Rs1439.80, ICICI Bank advanced by 7.36% at Rs346.65, State Bank of India added 7.33% at Rs1,023.45 and Reliance Communications rose 6.19% at Rs168.15. DLF, the only stock posting loss for the day, slumped by 2.16% at Rs167.40.
Banking stocks sparkled on the back of firm Asian indices. Oriental Bank of Commerce vaulted by 9.55% at Rs110.65, Axis Bank soared 9.04% at Rs374.05, Punjab National Bank zoomed 8.72% at Rs362.25, Bank of Baroda advanced 7.97% at Rs220.70, Union Bank of India shot up by 6.45% at Rs139.55 and HDFC Bank added 5.60% at Rs884.645. Kotak Mahindra Bank, Bank of India and Indian Overseas Bank gained in the range of 4-5% each.
Over 1.78 crore shares of Ballarpur Industries changed hands on BSE followed by Suzlon Energy (1.05 crore shares), Reliance Natural Resources (98 lakh shares), Satyam Computer Services (78 lakh shares) and GVK Power & Infrastructure (78 lakh shares).
Biggest rally in Sensex in more than three months
Banking stocks surged tracking global rally in financial stocks as key benchmark indices made hefty gains on latest effort by the US to revive the economy and stabilize its financial system. Ranbaxy Laboratories spurted and Index heavyweight Reliance Industries galloped. The BSE 30-share Sensex jumped 457.34 points, or 5.1%. It was the biggest single day rally in the Sensex in percentage terms since early December 2008. The barometer index today hit its highest level in more than a month.
Asian and European stocks rose and US index futures surged ahead of a US government announcement today, 23 March 20009, of plans to rid banks of toxic assets. The sentiment was bolstered by expectations that the US Treasury's efforts to stabilise the ailing financial system would speed up a recovery of the US economy. The United States offered financing for private investors as part of a plan to purge banks of up to $1 trillion in toxic assets in its drive to pull the world's biggest economy out of deep recession.
Buying by foreign funds also underpinned sentiment. Expectations of a further easing of the monetary policy remain with headline inflation at a record low.
The fall in headline inflation to a record low has raised expectations of further easing of the monetary policy by RBI to boost demand in the economy. Inflation based on the wholesale price index (WPI) rose 0.44% in the year through 7 March 2009, a record low for the current series, data released by the government during trading hours on Thursday, 19 March 2009, showed. The rate of growth in inflation was much lower than previous week's annual rise of 2.43%.
Interest rates in India have to fall further to channel more funds into infrastructure projects, Planning Commission member Kirit Parikh said on Friday, 20 March 2009. The Reserve Bank of India (RBI) has aggressively cut its policy lending rate by 400 basis points since October 2008, but banks are yet to reduce their individual lending rates to that extent.
Retail inflation is, however, ruling firm even as the whole sale price inflation has touched a record low. Retail inflation as measured by the Consumer Price Index for farm labourer (CPI-AL) and rural labourers (CPI-RL) eased to 10.79% in February 2009, a marginal dip from 11.62% and 11.35% respectively in January 2009. CPI-AL and CPI-RL were at 6.38% and 6.11% in corresponding period last year.
Annual inflation for food articles remains high even though it has eased from the 10 year high of 11.64% witnessed in first week of January 2009. Inflation for food articles stood at 7.35% for first week of March 2009 with double-digit price rise for many items including sugar and gur, pulses and cereals. At the time of announcing a reduction in key short-term interest rates, the RBI said early this month that though consumer price inflation has remained at elevated level due to increase in primary articles prices, it is expected to decline with a lag effect due to sharp fall in the wholesale price inflation.
Earlier the global financial crisis ends and sooner the risk appetite of global investors and global companies improves, better it will be for India Inc. An increase in risk appetite of global investors/global companies will help Indian firms raise overseas funds required for business expansion. The global financial crisis has chocked the overseas funding route for Indian firms.
Lack of funding has hit a slew of long-gestation infrastructure projects in India. World Bank Chief Economist & Senior Vice-President, Dr Justin Yifu Lin, on 13 March 2009, said if India can improve its infrastructure such as electricity, power, transportation and port facilities, it will be well on its path to achieve a 9-10% growth.
Meanwhile, foreign institutional investors are now in buying mode which follows easing of FII selling vigour in the past few days. FIIs bought shares worth a net Rs 1132.80 crore in five trading sessions from 13 March 2009 to 19 March 2009.
Foreign funds can take solace in the recent sharp rebound in the rupee against the dollar. However, the currency has been volatile. The partially convertible rupee was at 50.38 per dollar, above Friday's close of 50.66/68. A recent sharp slide in the rupee to a record low had resulted in a depreciation in the value of FIIs equity portfolio to the extent of the fall in rupee. The rupee hit a record low beyond 52 per dollar early this month.
Domestic institutional investors have been absorbing heavy selling by foreign funds in calendar year 2009.
However, the upside on the domestic bourses will be capped in the next two months due to political uncertainty ahead of parliamentary election to be held between mid-April 2009 to mid-May 2009. More so at a time when it is highly unlikely that either Congress or BJP will come to power on its own, i.e., without the support of other small/regional parties. An alliance led by the Congress party is ahead in pre-poll surveys carried out by several polls.
However, in a move which could undermine the chances of a Congress-led alliance getting more seats in the election, RJD supremo Lalu Prasad today announced candidates for 28 of the 40 constituencies in Bihar including from the three seats where Congress has sitting MPs. RJD is one of the key constituents of the current Congress-led UPA government at the Centre.
Meanwhile, a good news for the Asian emerging markets is that the region accounted for the bulk of the healthy inflow into emerging market equities funds during the week ended 18 March 2009, according to the latest data from fund tracker EPFR Global. Emerging market equities, among the riskier asset classes, saw a healthy net inflow of $350.3 million in the latest week. Funds focused on Asia ex-Japan made up the bulk of that overall amount, with a net inflow of $409.2 million.
However, the Indian market may remain volatile in the next few days ahead of the expiry of March 2009 derivatives on Thursday, 26 March 2009.
Meanwhile in a move that could boost turnover market regulator Security and Exchange Board of India (Sebi) plans to introduce new derivative products like lower-value contracts on individual stocks in the domestic derivative market in a bid to encourage retail investors in the option and future market. The derivatives market review committee has recommended mini contract that would be fourth or a tenth in size of a normal derivative contract besides some measures to increase participation and liquidity in the market. The Sebi panel also recommend increase in tenure of longer-term options up to three years to attract more investors and bring transparency in the system.
The Sebi's committee on derivatives market has also recommended making margining systems simpler. The committee has recommended that the margining system be made more straightforward through the introduction of portfolio-based and cross-margining systems.
European shares rose in early trade on Monday with financials the major gainers as investors trained their sights on a US Treasury plan to buy toxic assets from banks. Key benchmark indices in France, Germany and UK were up by between 1.61% to 1.95%.
Asian markets surged today, 23 March 2009 on optimism that the US government stimulus efforts will revive lending and ease the global economic slump. Key benchmark indices in China, Hang Seng, Japan, Singapore, South Korea and Taiwan were up by between 1.95% and 4.78%.
Trading in US index futures indicated the Dow could rise 205 points at the opening bell on Monday, 23 March 2009, as investors awaited the release of a US plan to stabilize the financial system. A Wall Street Journal report late Sunday, 22 March 2009, cited US Treasury Secretary Timothy Geithner as saying that the only way to resolve the financial crisis was to work with the private sector to remove troubled assets clogging banks' balance sheets.
US stocks declined on Friday, 20 March 2009 as the Federal Reserve's plan to rekindle consumer and small business lending fell short of expectations and General Electric was hit by analysts' bearish comments. The Dow Jones Industrial Average slipped 122.42 points, or 1.65%, to 7,278.38. The Standard & Poor's 500 Index shed 15.50 points, or 1.98%, to 768.54 and the Nasdaq Composite Index lost 26.21 points, or 1.77%, to 1,457.27.
The BSE 30-share Sensex jumped 457.34 points, or 5.1%, to 9,424.02, its highest closing since 13 February 2009 and its biggest one-day rise in percentage terms since early December 2008. At the day's high of 9,454,69, the Sensex rose 488.01 points in late trade. At the day's low of 9,040.30, the Sensex gained 73.62 points in early trade.
The S&P CNX Nifty gained 133.85 points or 4.73% at 2939.90.
From a three-year closing low of 8,160.40 on 9 March 2009, the BSE Sensex has risen 1,263.62 points or 15.48%.
The BSE clocked a turnover of Rs 3,709 crore, higher than Rs 2,942.83 crore on Friday, 20 March 2009.
Nifty March 2009 futures were at 2936.50, at a discount of 3.40 points as compared to the spot closing of 2939.90. Turnover in NSE's futures & options (F&O) segment surged to Rs 63,299.50 crore from Rs 43,647.51 crore on Friday, 20 March 2009
The BSE Mid-Cap index was up 2.73% and BSE Small-Cap index rose 2.01%. Both the indices underperformed the Sensex.
The BSE Bankex (up 6.66%), the BSE Oil & Gas index (up 6.4%), the BSE Metal index (up 6.31%) outperformed the Sensex.
The BSE PSU index (up 4.21%), the BSE Power index (up 3.66%), the BSE TECk index (up 3.35%), the BSE Healthcare index (up 3.35%), the BSE Capital Goods index (up 2.84%), the BSE IT index (up 2.44%), the BSE Auto index (up 2.35%), the BSE Consumer Durables index (up 2.31%), the BSE FMCG index (up 2.05%), the BSE Realty index (up 1.39%) underperfomed the Sensex.
The market breadth, indicating the overall health of the market, was strong on BSE with 1,630 shares advancing as compared with 923 that declined. A total of 60 shares remained unchanged.
From the 30 share Sensex pack, 29 stocks rose while rest fell. Reliance Infrastructure, HDFC, Reliance Communications, Jaiprakash Associates rose by between 6.19% to 9.88%.
Rate sensitive real estate shares rose on hopes lower rates will spur housing demand. Indiabulls Real Estate, Housing Development & Infrastrucutre and Unitech rose by between 3.71% to 3.81%. While India's largest realty major by market capitalization DLF fell 2.16%.Most of the realty deals including sale of commercial property and housing sales is driven by finance.
Some FMCG stocks rose on expectations of better Q4 March 2009 results following reports of higher advance tax payment by these firms. Dabur India, Tata Tea, ITC, REI Agro, Marico rose by between 0.55% to 2.83%. India's largest FMCG firm by sales Hindustan Unilever rose 2.45%. The company's advance tax payment rose 30% to Rs 130 crore in Q4 March 2009 over Q4 March 2008.
India's largest engineering and construction firm by sales Larsen & Toubro (L&T) rose 3.35% on recent reports L&T and Grasim Industries are on the verge of settling their 7-year old legal dispute over Grasim`s 0.62% stake in L&T and the latter`s 11.49% stake in Ultratech, the Birla group cement firm. Grasim Industries and Ultratech Cement are Aditya Birla group companies. Other capital goods stocks, Bharat Heavy Electricals, ABB, Praj Industries, Crompton Greaves rose by between 0.64% to 6.54%.
India's largest drug maker by sales Ranbaxy Laboratories rose 10.8% after company said drug regulators in the UK and Australia had issued "good manufacturing practice" certificates for its Paonta Sahib facility in India. The stock was the top gainer form the Sensex pack. In February 2009, the US Food and Drug Administration halted reviews of drug applications from Paonta Sahib plant saying it had falsified data. Other healthcare stocks, Dr Reddy's Laboratories, Sun Pharmaceuticals Industries, Panacea Biotec, Cipla, Biocon, Pfizer, Lupin, rose by between 0.79% to 5%.
India's largest commercial vehicle maker by sales Tata Motors rose 3.2%. The company announced the launch of its much awaited Rs 1 lakh small car Nano in Mumbai after market hours today. Just ahead of the launch Chairman Ratan Tata said in Mumbai that Tata Motors will be allocating 1,00,000 cars through a system of lottery and this will be price protected. The actual deliveries of the cars would start from July 2009, he said. The company is also looking to develop an export model for the US market but that would not be until 2011, Tata said.
Meanwhile, Tata Motors Managing Director Ravi Kant said Tata Motors is seeing an upturn in automobile sales on month-on-month basis
Other auto stocks Mahindra & Mahindra, Hero Honda Motors Maruti Suzuki India, rose by between 0.39% to 3.78%.
India's largest private sector company by market capitalization and oil refiner Reliance Industries (RIL) rose 7.56% to Rs 1,439.80 on reports it may get to use the gas it produces. The firm is expected to use the natural gas as fuel for its captive power projects, apart from other industrial uses such as heating. Under the current gas utilisation policy, RIL can't use its own gas.
The company is expected to start production of gas from KG basin, off the east coast, shortly. Meanwhile, RIL is reported to be in talks with Essar Oil to source petroleum products from the latter's refinery in Gujarat to restart its retail outlets that were shut for nearly a year.
RIL's advance tax payment fell 16.47% to Rs 370 crore in Q4 March 2009 over Q4 March 2008.
Cairn India gained 6.1% after the crude oil prices rose towards $53 a barrel in Asian electronic trading on Monday, 23 March 2009. India'a largest oil exploration firm by sales ONGC rose 5.35%. Rise in crude oil prices would result in higher realizations from crude sales for the oil exploration firm.
Metal stocks jumped on a surge in metal prices on London Metal Exchange. Steel Authority of India, Hindustan Zinc, Sterlite Industries, Tata Steel, National Aluminum Company and Hindalco Industries, rose by between 2.35% to 10.39%.
Banking shares surged on hopes lower interest rates may boost lending growth. India's largest private sector bank by net profit ICICI Bank rose 7.36% even as its American depository receipts (ADR) fell 6% on Friday, 20 March 2009. ICICI Bank's advance tax payment remained unchanged at Rs 250 crore in Q4 March 2009 when compared to Q4 March 2008.
India's second largest private sector bank by operating income HDFC Bank rose 5.6% even as its ADR fell 4.88% on Friday. Its advance tax payment rose 10% to Rs 275 crore in Q4 March 2009 over Q4 March 2008.
India's largest bank in terms of assets and branch network State Bank of India rose 7.33%. Its advance tax payment jumped 27.64% to Rs 1810 crore in Q4 March 2009 over Q4 March 2008.
Outsourcing focussed IT stocks rose hopes of a revival in the US economy, the biggest market for IT firms. India's largest software services exporter by sales TCS rose 1.96% The company's advance tax payment fell 54.3% to Rs 53 crore in Q4 March 2009 over Q4 March 2008. The company during trading hours on Monday 16 March 2009 said its promoter Tata Sons has pledged more than 12.06 crore shares or 12.33% of the equity capital of the firm.
India's fifth largest IT major by sales HCL Technologies fell 0.48%. India's third largest software services exporter, Wipro gained 3.28% even as its ADR fell 2.8% on Friday. Recently its unit Wipro Infotech won an outsourcing contract worth Rs 1,182 crore from the Employees State Insurance Corporation (ESIC).
India's second largest software services exporter Infosys Technologies rose 2.57% on reports it may win a large IT project from the government, which will run on a transaction-based pricing model, similar to the passport processing contract its larger rival Tata Consultancy Services (TCS) won last year. The contract is among the many large IT contracts that are up for bidding from government departments or public sector undertakings, reports suggest. Its ADR fell 3.21% on Friday.
The Indian rupee climbed on Monday as rising Asian stock markets revived hopes of capital inflows into the local share market. A stronger rupee affects operating margins of IT firms negatively as they earn most of their revenues from exports.
Reliance Infrastructure surged 9.88% on reports the company is open to bidding for the over Rs 12,000 crore Hyderabad Metro Rail project if Maytas Infra backs out.
Ballarpur Industries clocked the highest volume of 1.78 crore shares on BSE. Suzlon Energy (1.05 crore shares), Reliance Natural Resources (98.63 lakh shares), Satyam Computer Services (78.90 lakh shares) and GVK Power Infrastructure (78.40 lakh shares) were the other volume toppers in that order.
Akruti City clocked the highest turnover of Rs 561.60 crore on BSE. Reliance Industries (Rs 249.65 crore), Reliance Capital (Rs 178.08 crore), ICICI Bank (Rs 154.13 crore) and Educomp Solutions (Rs 133.12 crore) were the other turnover topper in that order.
The Geithner Plan FAQ
Q: What is the Geithner Plan?
A: The Geithner Plan is a trillion-dollar operation by which the U.S. acts as the world's largest hedge fund investor, committing its money to funds to buy up risky and distressed but probably fundamentally undervalued assets and, as patient capital, holding them either until maturity or until markets recover so that risk discounts are normal and it can sell them off--in either case at an immense profit.
More here
Thanks Vinay
Daily Call - March 23 2009
As we usher in a new week, the Nifty carries over the desire to close above the 2840 mark. On the lower side, it will have to ensure that it does not tumble lower than 2700. We believe that the cash lying in the sidelines and the fact that many stocks have seen sudden upward moves, makes the environment better for buying stocks rather than selling. But no outright buying. Buy the dips till the 2840 resistance is not broken,when it becomes a full throttled buy.
In the US, the financials have lost steam and the commodities also showed signs of slowing down their surge as the Dollar made a comeback. But for today, don’t get carried over by any bullish Asian markets. Keep your balance and avoid the large caps like Reliance and L&T. Mid-caps like PSL, Bata and Financial Technology could do well. This is also the time to lock in Dividend Yields. We have an elaborate article inside on this bear market strategy.
Pre Session Commentary - March 23 2009
Today domestic markets are likely to open positive as the Asian markets have opened in green. However due to lack of some specific news the markets are likely to trade lackluster as one had witnessed during the previous two trading sessions. The northward movement of the other Asian markets could be probably due to expectations that Japan may come up with second stimulus package to revive their economy. In the domestic arena, there could also be a lot of selling pressure as the markets have gained a lot during the last week trade and therefore profit booking coupled with cautiousness would persist during the day’s trade.
On Friday, the domestic markets opened positive closed in red. The sentiments were week since the opening and as the trading progressed it dived into deep red. More than the domestic impulse the investors were tracking the lackluster Asian markets. However due to European markets trading in positive numbers the domestic markets towards the end recovered its losses to close in shallow red. Sectors like Realty, CG, Bankex and Auto fell by 4.14%, 2.54%, 1.95% and 1.32% respectively. However on the other hand Metal, FMCG and Oil & Gas managed to close in green. During the session we expect the markets to be trading positive with volatility.
The BSE Sensex closed with a loss of 35.07 points at 8,966.68 and NSE Nifty ended high by 12.45 points at 2,807.15. BSE Mid Caps ended with loss of 13.06 points to close at 2,761.06 and BSE Small Cap closed with gain of 16.85 points at 3,114.38 respectively. The BSE Sensex touched intraday high of 8,999.98 and intraday low of 8,867.13.
On Friday, the US stock markets closed in red territory. The markets tumbled on the second half of the trade due to abrupt selling pressure that pulled stocks. There was no specific news from the corporate or the government and therefore the trading was choppy. The volumes of trade were high due to quarterly expiration of stock options, index options, index futures and single stock futures. Defensives sectors like Consumer staples and healthcare gained 0.1% and 0.2% respectively. US light crude oil for April delivery which expires on Friday fell by $0.55 to settle at $51.06 a barrel on the New York Mercantile Exchange. COMEX gold for April delivery fell $2.60 to settle at $956.20 an ounce.
The Dow Jones Industrial Average (DJIA) closed low by 122.42 points at 7,278.38, the NASDAQ Composite (RIXF) index lost 26.21 points to close at 1,457.27 and the S&P 500 (SPX) lost by 15.50 points to close at 768.54.
Today major stock markets in Asia are trading with handsome gains. Hang Seng is trading with phenomenal gains of 395.84 points at 13,229.35 followed by Japan''s Nikkei up by 244.11 points at 8,190.07, Taiwan Weighted by 134.02 points at 5,095.64, Strait Times by 35.87 points at 1,632.79 and Seoul Composite by 28.24 points at 1,199.18.
Indian ADRs ended low. In technology sector, Patni Computers ended low by 2.75% along with Infosys that ended low by 3.21%. Further, Wipro lost 2.80% and Satyam closed low by 7.14%. In banking sector ICICI Bank and HDFC Bank lost 6% and 4.88% respectively. In telecommunication sector, Tata Communication advanced by 5.14% along with MTNL that fell by 10.47%. Further, Sterlite Industries fell by 0.32%.
The FIIs on Friday stood as net buyer in equity and net seller in debt. Gross equity purchased stood at Rs 1,429.80 Crore and gross debt purchased stood at Rs 599.30 Crore, while the gross equity sold stood at Rs 1,272.10 Crore and gross debt sold stood at Rs. 1,895.40 Crore. Therefore, the net investment of equity and debt reported were Rs 157.70 Crore and Rs (1296.10) Crore respectively.
On Friday, the Indian rupee closed at 50.66/68, 1.3% weaker than its previous close. Rupee fell on account of fall in stock markets.
On BSE, total number of shares traded were 25.15 Crore and total turnover stood at Rs 2,942.83 Crore. On NSE, total number of shares traded was 54.98.17 Crore and total turnover was Rs 8,780.27 Crore.
Top traded volumes on NSE Nifty – Unitech with 18932939, Suzlon with 15425886 shares, ICICI Bank with 14802957 shares, SAIL with 13864877 shares followed by Hindalco with 12720351 shares.
On NSE Future and Options, total number of contracts traded in index futures was 774462 with a total turnover of Rs 10,337.11 Crore. Along with this total number of contracts traded in stock futures were 473272 with a total turnover of Rs 13,721.16 Crore. Total numbers of contracts for index options were 1300653 with a total turnover of Rs 18,259.57 Crore and total numbers of contracts for stock options were 42364 and notional turnover was Rs 1,329.67 Crore.
Today, Nifty would have a support at 2,781 and resistance at 2,849 and BSE Sensex has support at 8,922 and resistance at 9,105.
Market may remain volatile
After registering the gains of 210 points in the last week, the market is likely to exhibit weak trends on the back of a strong intra-day volatile moves. The meltdown US markets and firm Asian indices in morning trades also likely to put pressure on the domestic indices. On the upside, the Nifty could test around the 2850 level and may witness support around the 2750 level. The Sensex has a likely support at 8825 and may test higher levels of 9125.
US indices fell sharply on Friday, with the Dow Jones sliding over 122 points to close at 7278 while the Nasdaq slipping by 26 points at 1457.
Indian stocks trading on the US bourses fell sharply. MTNL lost 10.47% followed by Satyam declined 7.14%, ICICI Bank, Infosys, Wipro, Dr Reddy, HDFC Bank and Patni Computers were down over 2-6% each. However, Tata Motors, VSNL and Rediff closed with the gains of 1-5 each..
Crude oil prices in the global market moved down on Friday. The Nymex light crude oil for April series lost by 55 cents at $51.06 per barrel. In the commodity segment, the Comex gold for April delivery moved down by $2.60 to settle at $956.20 an ounce.
Direct sale model for Nano ?
Tata Motors Ltd is likely to adopt a direct sale model for its nano car, Tata Motors will accept direct bookings for the car through branches of State Bank of India and its own dealerships. The company is likely to ask for a INR70,000 ($1,300) cash down payment and even booking forms are expected to cost INR500, the sources said. "All the deposits would therefore be available with Tata Motors for a few months, at least till the time the company decides on who gets the cars," the Web site quoted the sources as saying.
Market may open firm on positive Asian equities
Strong start in Asian indices on hopes for US plans to further help a strained financial system may spill over Indian bourses in opening trade. The SGX Nifty futures for March 2009 series jumped 42.50 points in Singapore. However volatility may remain high ahead of the expiry of March 2009 derivatives contracts for March 2009 series on Thursday, 26 March 2009.
Meanwhile in a move that could boost turnover market regulator Security and Exchange Board of India (Sebi) plans to introduce new derivative products like lower-value contracts on individual stocks in the domestic derivative market in a bid to encourage retail investors in the option and future market. The derivatives market review committee has recommended mini contract that would be fourth or a tenth in size of a normal derivative contract besides some measures to increase participation and liquidity in the market. Sebi's panel also recommend increase in tenure of longer-term options up to three years to attract more investors and bring transparency in the system.
The Sebi's derivatives market review committee's report released on Friday has also recommended making margining systems simpler. The committee has recommended that the margining system be made more straightforward through the introduction of portfolio-based and cross-margining systems.
Asian markets were trading higher today, 23 March 2009 on optimism that the US government stimulus efforts will revive lending and ease the global economic slump. Key benchmark indices in China, Hang Seng, Japan, Singapore, South Korea and Taiwan were up by between 1.24% and 3.01%.
US stocks declined on Friday, 20 March 2009 as the Federal Reserve's plan to rekindle consumer and small business lending fell short of expectations and General Electric was hit by analysts' bearish comments. The Dow Jones Industrial Average slipped 122.42 points, or 1.65%, to 7,278.38. The Standard & Poor's 500 Index shed 15.50 points, or 1.98%, to 768.54 and the Nasdaq Composite Index lost 26.21 points, or 1.77%, to 1,457.27.
According to provisional data on NSE, Foreign institutional investors (FIIs) were net sellers worth Rs 149.18 crore while mutual funds sold shares worth Rs 94.03 crore on Friday, 20 March 2009.
Bullion metals end mixed
Gold drops but silver manages to shine with the rebounding dollar
After rising for two straight days, bullion metals ended mixed with gold ending little lower on Friday, 20 March, 2009. The rebounding dollar was mainly the reason for this. The yellow metal, anyways, ended higher for the week after the dollar slumped earlier during the week after Fed said that it will buy long term treasuries thereby increasing the appeal of precious metals as a safe haven against alternatives. Fed's recent moves had sparked some good notions about the recovery from the recent recession in US.
Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa.
On Friday, Comex Gold for April delivery fell $2.6 (0.3%) to close at $956.2 an ounce on the New York Mercantile Exchange. For the week, the yellow metal ended higher by 2.8%. For the month of February, gold ended higher by 7.4%. For January, 2009, gold had gained 3.9%. Year to date, gold prices are higher by 15.5%.
On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped somewhat (8.9%) since then.
On Friday, Comex silver futures for May delivery rose 32 cents (2.4%) to end at $13.84 an ounce. Last week, silver fell 0.8% In February, 2009, silver had rose 4.3% after climbing 14% in January. Year to date, silver has climbed 26% this year. For 2008, silver had lost 24%.
In the currency market on Friday, the dollar index, which weighs the strength of the dollar against a basket of six other currencies, rose for the second time only in last nine sessions. In 2009, year to date, the dollar index has climbed 2.5%.
Crude ends little lower
Oil prices end more than 10% higher for the week
Crude prices ended little lower on Friday, 20 March, 2009. The rebounding dollar was mainly the reason for this. Crude, anyways, ended substantially higher for the week after the dollar slumped earlier during the week after Fed said that it will buy long term treasuries. Fed's recent moves had sparked some good notions about the recovery from the recent recession in US.
On Friday, crude-oil futures for light sweet crude for April delivery closed at $51.05/barrel (lower by $0.55 or 1.1%) on the New York Mercantile Exchange. The April contract expired on Friday. The more active May contract rose slightly to settle at $52.07/barrel. For the week, crude ended higher by 10.4%. For the month of February, crude prices had ended higher by 1.5%.
Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 67% since then. Year to date, in 2009, crude prices are higher by 18.5%. On a yearly basis, crude prices are lower by 51%.
Last week, the Fed said it was committed to buying $300 billion in longer-term Treasurys to help the struggling American economy recover. In the currency market on Friday, the dollar index, which weighs the strength of the dollar against a basket of six other currencies, rose for the second time only in last nine sessions. In 2009, year to date, the dollar index has climbed 2.5%.
Last Wednesday, EIA reported that gasoline inventories rose by 3.2 million barrels in the week ended 13 March, 2009. The EIA also reported an increase of 2 million barrels in crude inventories. Market was expecting a decline in either case. The EIA also said distillate stockpiles, which include diesel and heating oil, rose by 100,000 barrels.
Earlier during the month, the IEA said in the monthly report that global oil supply in February is estimated at 83.9 million barrels a day, down 1 million barrels from a month ago and 3.4 million barrels from a year ago. The agency also lowered its forecast for this year's global oil demand to 84.4 million barrels a day, 1.5%, or 1.2 million barrels, lower than a year ago.
Also at the Nymex on Friday, April reformulated gasoline fell 1.4% to $1.457 a gallon and April heating oil dropped 2% to $1.3834 a gallon.
April natural-gas futures rose 1.3% to $4.227 per million British thermal units.
SGX Nifty in green
SGX Nifty March currently at 2,852.0 trading +44.0 points
SGX Nifty April currently at 2,845.0 trading +43.0 points
Daily News Roundup - March 23 2009
Reliance Industries is set to sign gas sale and purchase agreement with the identified urea plants sometime next week. (BL)
Power and fertilizer companies have expressed dissatisfaction over the revised gas sale and purchase agreement forwarded by the Reliance Industries for the supply of KG D6 gas. (FE)
Reliance Industries may get to use KG Basin gas as fuel for its captive power projects. (ET)
Infosys may bag IT project from government which would run on transaction based pricing model. (ET)
DLF to acquire DLF Asset Ltd for an enterprise value of around Rs70bn. (BS)
NTPC says it will import 12.5mn tons of coal in the next financial year to meet its fuel requirement.(FE)
ACC has put on hold its Rs6bn expansion plans for the ready-mix concrete business in 2009, citing low demand due to the global slowdown.(FE)
Wipro gets ESIC’s Rs11.8bn e-governance deal.(Mint)
iGate Corp pulled out of the bidding process for a controlling 31% stake in Satyam, citing a lack of updated financial and legal information on the company.(FE)
List of 5 final bidders for Satyam likely by March 25.(BL)
NTPC, Coal India impasse on fuel supply pact ends.(BL)
Telenor Group says it has completed the Unitech Wireless transaction and made the first investment of Rs12.5bn that gives it a stake of 33.5% in the telecom JV.(FE)
Coal India is eyeing one more block in Mozambique, this time through International Coal Ventures.(BL)
IOC may win contract for providing aircraft fuelling facility at Delhi Airport. (ET)
United Breweries is putting together a roadmap for the next fiscal which includes three new brand launches.(BL)
Essar Power has announced that it has raised Rs3.5bn from IDFC Project Equity for part-financing the equity for its ongoing projects.(BL)
Lanco Infratech abandons plans to set up wind turbine facilities.(Mint)
Shipping Ministry plans to seek around Rs10-15bn from the Defence Ministry for transferring the administrative control and assets of Hindustan Shipyard.(BL)
Videocon group promoted DTH venture has finalized a launch date-April 27-after many delays.(TOI)
IDBI Bank to syndicate USD 1-billion loan for Air India.(DNA)
Edible-oil producer Adani Wilmar, the 50:50 JV between the US$5bn Adani Group and Singapore-based Wilmar International, will invest Rs6bn next fiscal in greenfield and brownfield projects.(DNA)
IDBI Bank has joined other domestic and international banks to bid for the Indian retail operations of erstwhile ABN Amro.(FE)
Tata Tea is foraying into the Rs 100bn non-carbonated cold drinks market with the launch of T!ON.(DNA)
Oil Ministry seeks Election Commission's nod to hold a meeting of EGoM to decide on allocation of natural gas from Reliance Industries' eastern offshore KG-D6 fields to power plants.(BS)
Ruias of the Essar Group have decided to postpone the expansion plan for the Vadinar refinery-from the current 12.5mn tonne pa to 34 mn tonne pa in two phases-for at least for eight months due to various reasons.(FE)
SC issues notice to Moser Baer in tax matter.(ET)
Cairn India to be ready to pump out its first barrel of oil in 10 days.(ET)
S Kumars Nationwide to form a joint venture with DKNY. (ET)
Essar Power to align with Spain’s Union Fenosa to develop projects.(Mint)
Essar Steel sets up a steel processing facility, with a capacity of 0.25mn tonnes per annum, at Oragadam near Chennai.(ET)
The BSE is discussing a possible alliance with Multi Commodity Exchange of India.(Mint)
Forex reserves rose by US$1.4bn to US$249bn in the week ended March 13.(BL)
RBI is considering relaxing the group exposure norms that limit a scheduled commercials bank’s lending to a borrowing group.(FE)
RBI says it will buy dated government securities of Rs 100bn through auction-based open market operation on March 25.(FE)
TRAI has laid down more stringent standards of Quality of Service of Basic Telephone Service and Cellular Mobile Telephone.(BL)
Government has raised the coal import target for power generation by 15mn tonnes to 35mn tonnes in 2009-10.(TOI)
Merchandise exports to the US grew 2.65% in the first eight months up to November 2008.(BS)
State-run infrastructure financing company IIFCL on Friday said the World Bank will disburse US$1.2bn loan next month for its various infrastructure projects. (FE)
India’s total external financial assets declined by 5.21%.(BS)
Government is understood to have held back its decision to lower the license fee by about 33% with effect from April 1, for those telecom operators who have 95% or more coverage in a circle.(FE)
US announces additional measures for hiring of H-1B workers.(DNA)
FII equity investments down US$18.6bn in first half of 2008-09.(BL)
Toxic tonic thrills bulls
The only thrill worth while is the one that comes from making something out of yourself.
Good morning, as we look set for a bright start. Indices may be in green but make sure your investments too are safe. Asian indices are mostly higher. Obama regime is expected to announce a plan to buy banks’ soured assets. Nifty futures in Singapore and Dow futures are smartly up. But, there could be wild swings for sure ahead of F&O expiry. Also, some resistance is likely at higher levels as investors could turn cautious ahead of an eventful April. We will have to contend with earnings, elections and RBI policy next month.
On the political front, the heat is definitely on. The two main parties (Congress and BJP) so far have been the worst hit. While an internal row is taking toll on BJP, the Congress is facing a revolt of sorts from long-time allies like RJD. Even its alliance with in Uttar Pradesh (SP) and Maharashtra (NCP) are pretty fragile. Post the vote counting, the equations could swing either way. It is this uncertainty and unpredictability of polls that could potentially prove to be a spoilsport for the bulls.
FIIs were net buyers in the cash segment on Friday at Rs1.49bn while the local institutions were net sellers at Rs940.3mn. In the F&O segment, the foreign funds were net buyers at Rs955.5mn. On Thursday, FIIs were net buyers of Rs1.58bn. Mutual Funds were net sellers of Rs450mn on the same day.
US stocks tumbled on Friday, as investors locked in some gains after the recent rally. Banks and technology shares were among the leading losers.
The Dow Jones Industrial Average lost 122 points or 1.7%, to 7,278.38. However, it also managed slim gains for the week, rising for the second week in a row for the first time since last May.
The S&P 500 index fell 15 points, or 2%, to 768.54 while the Nasdaq Composite index fell 26 points or 1.8%, to 1,457.27.
Stocks had fallen on Thursday too after gaining for six of the prior seven sessions. During that run, the S&P 500 rose 17%, spurred on by better-than-expected reports on housing and retail sales and some signs of stabilization in the bank sector. Investors also welcomed news that the Federal Reserve is pumping another trillion into the economy to try to get credit flowing.
Those gains followed a 28% decline for the S&P 500 that left the benchmark index at a 12-1/2 year low. The S&P 500 topped 800 both on Wednesday and on Thursday and that will likely prove to be a key technical level to watch in the weeks ahead, according to some analysts.
Federal Reserve chairman Ben Bernanke, speaking before a group of community bankers in Phoenix, defended the need to bail out banks seen as too big to fail, such as AIG. However, he noted that it is an enormous problem that must be addressed.
Sheila Bair, chairman of the Federal Deposit Insurance Corp, also spoke before the same industry group. She said that more regulation is needed to solve the banking crisis.
Separately, the government reported that there were 2,769 mass layoffs in February, resulting in 295,477 job cuts. A mass layoff involve 50 or more job cuts at the same time. In January, there were 2,227 mass layoffs.
AIG remained in focus after the House of Representatives on Thursday voted to impose a steep tax on large employee bonuses at firms that accepted government bailout money. The legislation was created in response to the public outcry after AIG handed out over $165 million in bonuses to executives after it accepted more than $170 billion in federal bailout money.
In an interview with a leading media house on Thursday, treasury secretary Timothy Geithner said his department was responsible for a provision in the $787 billion stimulus package that allowed AIG and other companies to award bonuses.
Ericsson warned that it will post a loss in the first quarter due to weaker consumer demand for its phones amid the global financial crisis. Shares fell 10.6%. Also in the telecom space, Palm reported a wider quarterly loss and weaker sales late Thursday that missed analysts' estimates. Despite the loss, shares gained 2%.
Treasury prices slipped, raising the yield on the benchmark 10-year note to 2.63% from 2.60% on Thursday.
Lending rates improved. The 3-month Libor rate fell to 1.22% from 1.23% Thursday, while the overnight Libor rate dipped to 0.28% from 0.3% Thursday. Libor is a bank-to-bank lending rate.
In currency trading, the dollar gained versus the euro and the yen.
US light crude oil for April delivery, which expires on Friday, settled down 55 cents to $51.06 a barrel on the New York Mercantile.
COMEX gold for April delivery fell $2.60 to settle at $956.20 an ounce.
The president of the European Central Bank (ECB) said in a Wall Street Journal interview that Europe doesn't need to boost spending further to combat the global financial crisis, throwing the bank's weight behind Europe's governments in their battle with the US over how to overcome the worst recession in a generation.
ECB leader Jean-Claude Trichet said that instead of pushing new measures, governments around the world should move faster on what they've already announced - referring in part to delays and difficulties in the US government's rescue of its troubled banks.
Separately, large corporations in Japan saw business conditions worsen during the January-to-March period, according to a survey released by the Japanese government today.
The business sentiment index for corporations with capital of 1 billion yen or more was at negative 51.3 in the first quarter of this year, below the negative 35.7 seen in October-to-December 2008, according to the survey, which is conducted jointly by the Ministry of Finance and Cabinet Office.
Indian markets ended on a flat note on Friday amid wild swings. After closing above the crucial 9k and 2,800 levels on Thursday, key indices were unable to build on as weak global cues coupled with profit taking at higher levels kept the sentiments mixed on Dalal Street. The BSE Sensex finally gained 25 points to close at 9,001 and the NSE Nifty was up 12 at 2,807.
Among the 30-components of Sensex, 13 stocks ended in positive terrain and 17 stocks ended in the red. Hindalco, ONGC, Sun Pharma, HDFC and Tata Steel were among the major gainers. ON the other hand, Tata Motors, ICICI Bank, L&T, Maruti and BHEL were among the major losers.
Among the BSE Sectoral indices BSE Realty index was the top loser, the index fell 4%. Among the other major losers were BSE Capital Goods index (down 2.5%), BSE Bankex (down 2%) and BSE Auto index (down 1.2%).
Market breath was positive, 1,242 stocks advanced against 1,223 declines, while, 99 stocks remained unchanged.
Shares of Dr. Reddy's Lab declined by over 3% to Rs421. The company is reportedly realigned its Global Generics finished dosages strategy to focus on certain key geographies and would exit some of the very small distributor driven markets.
The markets it was withdrawing from contributed less than one percent of its total annual revenues, the Hyderabad-based drugmaker said in a statement on Thursday. The move appears to be the company’s renewed attempt to consolidate and grow in its key geographies.
The scrip touched an intra-day high of Rs431 and a low of Rs415 and recorded volumes of over 56,000 shares on BSE.
The bizarre run in Akruti shares finally came to an end as the stock has plunged by over 28% after the NSE announced that it would remove Akruti City Ltd from its derivatives segment.
Trading in futures and options would be stopped after March 26, 2009 the day contracts for April and May expire. Outstanding contracts in the April-May series will expire on March 26, the last day of the current settlement cycle. The NSE has also placed the stock in the Trade to trade segment effective from March 27.
The stock had rallied over 137% in the last six trading sessions and has surged 147% from its 52-wek low of Rs550 hit on January 1, 2009.
The stock has been constantly outperforming the real estate sector as well as major equity indices despite sliding real estate prices.
Of the company’s equity base of 66.7mn shares, promoters own 90%, around 6% is held by corporate bodies and the rest by the public.
Shares of NDTV surged by over 2.5% to Rs82.2 after reports stated the NDTV consortium is also in the race to acquire broadcast rights for the upcoming T20 tournament. This consists of NDTV, Malaysian broadcaster Astro and PE fund Providence Capital. In addition, Multi screen Media (MSM) and ESPN Star sports are also in the fray for the same.
MSM had dragged BCCI to Bombay HC last weekend, seeking injunction over the cricket board attempting to negotiate a fresh contract for IPL’s broadcast rights. However, MSM, (earlier Sony Entertainment) is close to resolving the legal dispute with the BCCI, reports added.
The stock had hit a 52-week high of Rs482 on June 18, 2008 and hit a 52-week low of Rs69 on December 2, 2008.
Jet Airways India
We recommend a sell in Jet Airways from a short-term trading perspective. It is apparent from the charts of Jet Airways that after recording a 52-low at Rs 115 on March 12, the stock bounced up.
It gained almost 65 per cent in a short span of five trading session and encountered resistance in the band between Rs 180 to Rs 190.
At this resistance, the stock formed a shooting star candlestick pattern, which is a top reversal pattern. However, subsequently, it resumed its medium as well as long-term down trend.
On March 20, the stock plummeted by 10 per cent confirming the reversal pattern. The daily relative strength index has entered into the neutral region from the bullish zone signalling loss of bullish momentum.
We are bearish on the stock from a short-term perspective.
We expect it to decline further until it hits our price target of Rs 144 in the approaching sessions. Traders with short-term perspective can sell the stock while maintaining a stop-loss at Rs 168.
My Portfolio - March 23 2009
Nothing much has changed - maybe trimmed a little of losses. 93% down is PSTL
SGX Nifty Live Update - March 23 2009
SGX Nifty March Futures at 2,841.0 trading at +33.0 points
SGX Nifty April Futures at 2,838.0 trading at +36.0 points
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