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Tuesday, April 21, 2009

Turnover surges

Nifty April 2009 futures at discount

Nifty April 2009 futures were at 3358, at a discount of 7.30 points as compared to the spot closing of 3365.30. Turnover in NSE's futures & options (F&O) segment surged to Rs 72749.77 crore from Rs 64896.29 crore on Monday, 20 April 2009.

Reliance Industries April 2009 futures were at discount at 1704.70 compared to the spot closing of 1706.10.

DLF April 2009 futures were at discount at 231.95 compared to the spot closing of 237.45.

State Bank of India April 2009 futures were at discount at 1245.10 compared to the spot closing of 1253.80.

In the cash market, the S&P CNX Nifty lost 11.80 points or 0.35% at 3365.30.

BSE Bulk Deals to Watch - Apr 21 2009

Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
21/4/2009 507852 ADDI INDUSTR URMILA JAIN B 290000 4.75
21/4/2009 507852 ADDI INDUSTR NOSTALGIA COMBUILD PVT LTD S 290000 4.75
21/4/2009 590061 BRUSHMAN IND WITHAL COMMERCIAL PVT LTD B 70000 22.00
21/4/2009 590061 BRUSHMAN IND ASHOK FINSTOCK PVT LTD. S 70000 22.00
21/4/2009 530067 CONSOL. SEC. KULBHUSHAN SINGH NARULA S 30000 23.95
21/4/2009 532839 DISH TV JAYNEER CAPITAL PVT LTD S 2165000 29.26
21/4/2009 531137 GEMSTONE INV HEMANT M SHETH S 39100 23.01
21/4/2009 532909 GRABAL ALOK PASHA FINANCE PVT LTD S 199161 47.85
21/4/2009 523289 RAMA VISIO L RVL FINANCE INVESTMENTS PVT.LTD. B 210000 7.20
21/4/2009 523289 RAMA VISIO L A U S FINANCE INVESTMENT PVT LTD B 180000 7.20
21/4/2009 523289 RAMA VISIO L GAURAV CHHABRA S 491000 7.20
21/4/2009 531646 RFL INTERNAT GEETA NARENDRA SHAH B 30000 0.80
21/4/2009 512413 SPECTACLE HITESHBABUBHAIDOBARIYA B 578777 56.46
21/4/2009 512413 SPECTACLE HITESHBABUBHAIDOBARIYA S 565927 56.31
21/4/2009 517224 SUJANA UNIV BASMATI SECURITIES PVT. LTD. B 639035 8.62
21/4/2009 517224 SUJANA UNIV BASMATI SECURITIES PVT. LTD. S 637368 8.67
21/4/2009 526133 SUPERTEX IND KUMKUM STOCK BROKER PVT LTD B 79583 24.83
21/4/2009 526133 SUPERTEX IND KUMKUM STOCK BROKER PVT LTD S 103029 24.80
21/4/2009 531874 VENUS VENT VICKY RAJESHBHAI ZHAVERI S 50000 35.95
21/4/2009 532893 VTM LTD UNIFI FINANCIAL P LTD B 61640 39.36
21/4/2009 532893 VTM LTD THIRUMAGAL FINANCE P LTD S 36810 39.50
21/4/2009 531249 WELL PACK PA GANDHI MANISHA NAVNEETLAL B 23556 149.02
21/4/2009 531364 ZENU INFOTEC G.K. TRADING PVT. LTD. B 59963 6.15
21/4/2009 531364 ZENU INFOTEC JYOTI DEEPAK JAIN S 60000 6.15

NSE Bulk Deals to Watch - Apr 21 2009

Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
21-APR-2009,BALRAMCHIN,Balrampur Chini Mills,NIRSHILP SECURITIES PVT. LTD.,BUY,1394859,71.34,-
21-APR-2009,EDUCOMP,Educomp Solutions Limited,C D INTEGRATED SERVICES LTD,BUY,151510,2413.36,-
21-APR-2009,HDIL,Housing Development and I,GENUINE STOCK BROKERS PVT LTD,BUY,3259832,133.38,-
21-APR-2009,KALINDEE,Kalindee Rail Nirman (Eng,MANSUKH SECURITIES & FINANCE LTD,BUY,69130,122.01,-
21-APR-2009,KARURVYSYA,Karur Vysya Bank Ltd,IDEASPACE SOLUTIONS LTD,BUY,275000,261.44,-
21-APR-2009,ORBITCORP,Orbit Corporation Limited,CPR CAPITAL SERVICES LTD.,BUY,212974,76.88,-
21-APR-2009,POLARIS,Polaris Software Lab Ltd,NIRSHILP SECURITIES PVT. LTD.,BUY,182615,69.04,-
21-APR-2009,TULSI,Tulsi Extrusions Limited,VERMA OM PARKASH,BUY,85678,18.18,-
21-APR-2009,WWIL,Wire and Wireless (India),ADROIT FINANCIAL SERVICES PVT LTD,BUY,1193515,14.44,-
21-APR-2009,BALRAMCHIN,Balrampur Chini Mills,NIRSHILP SECURITIES PVT. LTD.,SELL,233110,71.07,-
21-APR-2009,EDUCOMP,Educomp Solutions Limited,C D INTEGRATED SERVICES LTD,SELL,151510,2414.34,-
21-APR-2009,HDIL,Housing Development and I,GENUINE STOCK BROKERS PVT LTD,SELL,3259832,133.42,-
21-APR-2009,KALINDEE,Kalindee Rail Nirman (Eng,MANSUKH SECURITIES & FINANCE LTD,SELL,69130,122.20,-
21-APR-2009,ORBITCORP,Orbit Corporation Limited,CPR CAPITAL SERVICES LTD.,SELL,212974,76.86,-
21-APR-2009,POLARIS,Polaris Software Lab Ltd,NIRSHILP SECURITIES PVT. LTD.,SELL,675415,68.88,-
21-APR-2009,TULSI,Tulsi Extrusions Limited,VERMA OM PARKASH,SELL,85678,18.88,-
21-APR-2009,WWIL,Wire and Wireless (India),ADROIT FINANCIAL SERVICES PVT LTD,SELL,1193377,14.47,-

Post Session Commentary - Apr 21 2009

The domestic market finally landed in negative precinct after skipping up and down throughout the trading session on mixed global cues. The benchmark indices moved southward despite RBI’s monetary policy announcement in which it cuts repo and reverse repo rates by 25 bps each to 4.75% and 3.25% respectively. However, market gained some ground during afternoon trade on a little buying seen among key stocks.

The market opened today on downbeat note mirroring unfavorable global cues. The US stock on Monday ended sharply lower with the financials closed 11.4% lower after Bank of America reported that its first quarter credit loss provisions totaled $13.4 billion, about $5 billion higher from the fourth quarter. The Indian market turned volatile shortly after opening and continued to trade lower till mid session. However, benchmark indices reported some recovery during afternoon trade, which was short-lived as stocks declined further despite RBI’s rate cut. Positive opening of European markets was also unable to bring much respite in the domestic bourses. Market slipped further to end the day with losses on selling pressure in key stocks. BSE Sensex ended below 10,900 level and NSE Nifty below 3,400. From sectoral front, most of the selling was seen in Bank, Auto, Capital Goods, Metal and IT stocks. However, Reality, FMCG and Pharma stocks managed to gain favor from the market. The broader markets were flat today as Mid Cap stocks ended marginally lower whereas Small Cap stocks were slightly up.

Among the Sensex pack 18 stocks ended in red territory and 12 in green. The market breadth indicating the overall health of the market remained flat as 1288 stocks closed in red while 1226 stocks closed in green and 83 stocks remained unchanged in BSE.

The BSE Sensex closed lower by 81.39 points at 10,898.11 and NSE Nifty ended down by 11.80 points at 3,365.30. BSE Mid Caps closed with losses of 5.77% at 3523.14 while Small Caps closed with gains 16.83 points at 4,027.98. The BSE Sensex touched intraday high of 11,068.82 and intraday low of 10,764.08.

Losers from the BSE Sensex pack are Tata Steel (7.06%), ICICI Bank (6.51%), Hindalco Maruti Suzuki (5.38%), Tata Motors (5.18%), Sterlite Industries (4.21%), L&T Ltd (3.41%), SBI (3.13%), Reliance Infra (3.12%) and M&M Ltd (2.45%).

Gainers from the BSE Sensex pack are Bharti Airtel (5.35%), Hindalco (3.83%), Sun Pharma (3.15%), DLF Ltd (2.84%), Tata Power (2.41%), ITC Ltd (2.33%) and HDFC Bank (1.84%).

RBI cuts repo and reverse repo rates by 25 bps each. The RBI cuts repo rate to 4.75% from 5% earlier and the reverse repo rate to 3.25% from 3.5%. Moreover, RBI says the GDP projection for FY10 at 6%. Cash reserve Ratio (CRR) kept unchanged at 5%. The Bank Rate has been retained unchanged at 6.0 per cent. RBI projected FY10 inflation at 4.0% by end March and FY10 credit growth projected at 20.0% and FY10 deposit growth projected at 18.0%. The First Quarter Review of Monetary Policy for 2009-10 will be undertaken on July 28, 2009.

On the global markets front the Asian markets which opened before the Indian market, ended mostly lower with decline in financial stocks on worries about rising bad loans at banks in the region as well as in the U.S. Stocks dragged down also due to lower-than-expected profit at China Mobile. Shanghai Composite, Hang Seng and Nikkei 225 ended lower by 21.63, 465.02 and 213.42 points at 2,535.83, 15,285.89 and 8,711.33 respectively. However, Straits Times index and Seoul Composite gained 12.40 and 0.42 points at 1,887.25 and 1336.81 respectively.

European markets which opened after the Indian market are trading in green. In Frankfurt the DAX index is trading up by 32.16 points at 4,518.46 and in London FTSE 100 is trading slightly up by 1.3 points at 3,992.16.

The BSE Bank index dropped by (2.8 %) or 156.75 points at 5,316.70 despite RBI’s rate cut. Scrips that lost are ICICI Bank (6.51 %), Bank of India (5.59%), Punjab National Bank (4.19%), Bank of Baroda (4.06%) and Kotak Bank (3.31%).

The BSE Auto index lost (2.52%) or 87.14 points to close at 3,364.41 on profit booking after a recent sharp rally in past trading session. Losers are Maruti Suzuki (5.38%), Tata Motors (5.18%), Amtek Auto (2.57%), M&M Ltd (2.45%) and Hero Honda Motors (2.11%).

The BSE Capital Goods index also ended lower by (2.39%) or 190.93 points at 7,791.31. Punj Lloyd (8.62%), Siemens Ltd (4.65%), Crompton Greaves (4.35%), Kalpat Power T (3.61%) and L&T Ltd (3.41%) ended in negative territory.

The BSE Metal plunged (1.8%) or 125.41 points at 6,836.88. Losers are Tata Steel (7.06%), Sterlite Industries (4.21%), Gujarat NRE C (3.26%), JSW Steel (2.77%) and Hindustan Zinc (1.97%).

The BSE Reality index advanced by (2.27%) or 49.96 points to close at 2,249.31 as reversed losses on expectations that lower rates will spur housing demand. Main gainers are Anat Raj (9.97%), Orbit Co (8.47%), Indiabull Real (5.44%), Housing Dev (5.17%) and DLF Ltd (2.84%).

The BSE FMCG stocks gained (1.57%) or 32.47 points to close at 2,140.3. Major gainers are Dabur India (5.31%), ITC Ltd (2.33%), HUL (1.72%) and Colgate Palm (0.61%).

Hexaware Technologies advanced by 2.41%. The company announced a global partnership with Greenplum, a leading provider of database software for the next generation of data warehousing and large scale analytic processing. While Greenplum will provide the database platform, Hexaware will enable the migration, implementation, upgrades and maintenance services on these platforms.

Matrix Laboratories Limited (Matrix) gained 0.42%. The company has been selected by the Clinton HIV/AIDS Initiative (CHAI) under its UNITAID-funded projects as the primary supplier of five antiretroviral (ARV) drugs used in second-line HIV/AIDS treatment regimens. Matrix also has been selected as the primary supplier of seven ARVs used for pediatric treatment.

TCS ended lower by 1.55%. The company reported slower growth in net profit and revenues in the March quarter. The company’s net profit grew 4.6% year- on-year to Rs 1,314 crore, while revenues grew 17.7% to Rs 7,171.8 crore in the fourth quarter of FY09. However the company issued a 1:1 bonus to the shareholders.

Oriental Bank of Commerce lost 2.96%. The bank has announced the cut in its term deposit rates by 25-100 basis points across various maturities and the revised rates will be applicable from April 21.

ICICI Bank declined by 6.51% after news which says that that the Group''s private equity firm ICICI Ventures CEO and MD Renuka Ramnath has resigned. The head of its insurance arm, Shikha Sharma, also put in her papers to join Axis Bank.

Realty shares rise in choppy market as RBI cuts short-term rates

Key benchmark indices settled in the red in a day of high volatility triggered by volatility in index heavyweight Reliance Industries. Rate sensitive banking and auto stocks fell even as realty stocks gained after the central bank cut short-term interest rates. The BSE 30-share Sensex fell 81.39 points or 0.74%, up close to 135 points from the day's low and off close to 170 points from the day's high.

The barometer index fell below the psychological 11,000 mark after it breached that level in afternoon trade. The barometer index had fallen below the 11,000 level in choppy trade on Monday, 20 April 2009.

Volatility continued today. After an initial sharp slide caused by weak global stocks, the market soon cut losses. The recovery was short-lived as the market weakened in mid-morning trade despite rate cut by the RBI. The market recovered in early afternoon trade. It extended recovery to trade in green in afternoon trade as a rate cut by the Reserve Bank of India (RBI) and gains in European stocks bolstered sentiment. Some of the Asian markets moved into the green from red and US index futures rose further supporting recovery on the domestic bourses. The market once again slipped into the red in mid-afternoon trade.

The RBI today cut its key short-term rates by 25 basis points each to shore up faltering growth in the face of the global economic slowdown. The repo rate, at which the Reserve Bank of India (RBI) infuses cash into the banking system, will be cut to 4.75%, and the reverse repo rate, at which it absorbs excess cash from banks, will be reduced to 3.25%, effective immediately.

The Reserve Bank also repeated a call for banks to pass on its rate cuts to customers and said deposit rates should also fall. "There is scope for the overall interest rate structure to move down within the policy rate easing already effected by the Reserve bank," it said, adding its latest rate cut reinforced the case.

The central bank cut is growth estimate for the year ended March 2009 (FY 2009) to 6.5% to 6.7%, from 7% projected earlier. It has forecast growth of around 6% for the year ending March 2010 (FY 2010).

The fiscal and monetary stimulus measures initiated during 2008-09 coupled with lower commodity prices could cushion the downturn in the growth momentum during 2009-10 by stabilizing domestic economic activity to some extent, RBI said in a statement. However, any upturn in the growth momentum is unlikely in view of the projected contraction in global demand during 2009, particularly decline in trade, it added.

Strong rural demand, lagged impact of monetary and fiscal stimuli, softening of domestic input prices, investment demand from brown-field expansion projects and some restructuring initiatives are expected to have a positive impact on industrial production in the coming months, the RBI said.

While moderation in internal accruals has an adverse effect on corporate investment, decline in input prices and reduction in borrowing costs may have a favourable impact on profitability of the corporate sector going forward, the RBI said.

The central bank said that managing large government borrowing in FY 2010 in a non-disruptive manner would be a major challenge, and said it would used a mix of monetary and debt management tools to ensure this was done smoothly. Large borrowings also militate against the low interest rate environment that the RBI is trying to maintain to spur investment demand in keeping with the stance of monetary policy, the central bank said in its policy statement.

The RBI said wholesale-priced based inflation was expected to turn negative early in the current fiscal year, but this should not be interpreted as deflation for policy purposes. It projected WPI inflation would be around 4% at the end of FY 2010.

The RBI said a planned April 2009 review of the policy on foreign banks in India would now not go ahead until there was greater clarity regarding stability, recovery of the global financial system and better global coordination on regulation and supervision.

European shares fell by midday on Tuesday in choppy trade as declines in bank stocks offset gains in defensives led higher by record earnings from British retailer Tesco. Key bench mark indices in France, Germany and UK were down by between 1.16% to 1.62%.

On the economic front, annual consumer-price inflation in Britain slowed to 2.9% in March 2009 from a pace of 3.2% in February 2009, the Office for National Statistics reported Tuesday.

Sweden's central bank on Tuesday cut its key lending rate to 0.5% from 1%, in line with expectations.

Asian markets slumped as lower-than-expected profit at China Mobile and the prospect of rising bank losses curbed optimism the global economy is recovering. Key benchmark indices in Hong Kong, China, South Korea and Japan were down by between 0.85% and 2.95%. But key benchmark indices in Taiwan and Singapore were up by between 0.03% to 1.73%. Both these markets were earlier in the red.

Trading in US index futures indicated the Dow could gain 31 points at the opening bell today, 21 April 2009. The Dow futures reversed gains earlier in the day.

US markets corrected sharply on Monday after Bank of America increased reserves for future loan losses by 57% since the end of December 2008. The Dow Jones industrial average fell 289.60 points or 3.56%, Standard & Poor's 500 Index declined 37.21 points or 4.28% and Nasdaq Composite index declined 64.86 points or 3.88%.

There were also concerns about the stress tests being conducted on US banks, results of which are expected on 4 May 2009. The US Treasury Department is reportedly contemplating a series of incentives for private preferred investors and bond-holders to convince them to convert their stakes in banks to common shares as part of a strategy to improve the banks' capital.

Closer home, political uncertainty, with polling for India's 15th Lok Sabha underway, may lead to volatile swings on the bourses in the next few days. The month-long parliamentary elections that began on 16 April 2009 will conclude on 13 May 2009 with results due on 16 May 2009. Poll estimates point to a fractured mandate.

Meanwhile, a high-powered panel is reportedly thrashing out a mega economic stimulus package with a kitty of Rs 50,000 crore, which may be part of the first Budget of the next government at the centre to be presented before 25 June 2009. The government had earlier announced two fiscal packages in addition to the Indian central bank Reserve Bank of India (RBI)'s monetary interventions to boost the economy. The earlier fiscal measures also liberalised various rules and regulations to increase liquidity and give a boost to spending.

A good news for the economy is forecast of a near normal monsoon by the India Meteorological Department (IMD) on 17 April 2009. The IMD said rainfall in the June-September 2009 monsoon season was expected to be 96% of the long-term average. The outlook is among the nation's most widely watched indicator as monsoon rains are a major influence on output of key crops, economic activity and also affects sentiment in the country's financial markets.

Foreign funds are in buying mode after heavy sales of Indian stocks in the first two months of calendar 2009. Foreign institutional investors (FIIs) bought shares worth a net Rs 332.60 crore on Monday, 20 April 2009. FII inflow in April 2009 totaled Rs 4,609.70 crore (till 20 April 2009). FII outflow in calendar year 2009 totaled Rs 2062 crore (till 20 April 2009).

The BSE 30-share Sensex fell 81.39 points or 0.74% to 10,898.11. At the day's high of 11,068.82, the Sensex rose 89.32 points in afternoon trade. At the day's low of 10,764.08, the Sensex fell 215.42 points in early trade.

The S&P CNX Nifty was down 11.80 points or 0.35% to 3,365.30.

BSE clocked a turnover of Rs 5,089 crore, higher than Rs 4,749.97 crore on Monday, 20 April 2009.

Nifty April 2009 futures were at 3358, at a discount of 7.30 points as compared to the spot closing of 3365.30. Turnover in NSE's futures & options (F&O) segment surged to Rs 72749.77 crore from Rs 64896.29 crore on Monday, 20 April 2009.

The BSE Sensex is up 1,250.80 points or 12.96% in calendar 2009 from its close of 9,647.31 on 31 December 2008.

Coming back to today's trade, the BSE Mid-Cap index fell 0.16%. The BSE Small-Cap index rose 0.42%. Both the indices outperformed the Sensex.

The BSE Realty index (up 2.27%), the BSE FMCG index (up 1.57%), the BSE Healthcare index (up 1.31%), the BSE TECk index (up 0.34%), the BSE Oil & Gas index (down 0.3%), the BSE PSU index (down 0.61%) outperfomed the Sensex.

The BSE Bankex (down 2.86%), the BSE Auto index (down 2.52%), the BSE Capital Goods index (down 2.39%), the BSE Metal index (down 1.8%), the BSE IT index (down 1.6%), the BSE Consumer Durables index (down 0.93%), the BSE Power index (down 0.74%) underperfomed the Sensex.

The market breadth, indicating the overall health of the market, was marginally negative, recovering from a weak breadth earlier in the day. On BSE, 1,232 stocks advanced as compared to 1,316 that declined. A total of 64 shares remained unchanged.

From the 30 share Sensex pack 18 stocks fell while rest gained.

India's largest private sector firm by market capitalisation and oil refiner Reliance Industries (RIL) fell 0.45% to Rs 1,706. The stock was choppy. It hit a high of Rs 1,734 and a low of Rs 1,670. Reliance Industries has announced the suspension of its export oriented unit (EOU) status for its oil & gas refinery in Jamnagar as the company plans to operate as a non-EOU refinery with effect from 16th April 2009 to cater to the increasing demand of petroleum products in the country.

Oil exploration firms fell after crude oil prices dropped. India's biggest state-run oil exploration firm by revenue Oil & Natural Gas Corporation (ONGC) declined 0.08% and Cairn India fell 1.52%. Oil for May delivery fell as much as 69 cents, or 1.5%, to $45.19 a barrel in electronic trading on the New York Mercantile Exchange. The fall in crude oil prices would result in lower realizations from crude sales for oil exploration firms.

Crude oil fell for a second day as the prospect of rising bank losses curbed optimism the global economy is recovering

Oil price fall benefited PSU OMCs. HPCL and Indian Oil Corporation rose by between 0.25% to 0.58%. But BPCL fell 0.26%. Lower oil prices will reduce under-recoveries at the state-run oil firms on domestic sale of petrol, diesel, LPG and kerosene at a controlled price.

Some FMCG stocks rose on forecast of a near normal monsoon this year. Marico, ITC, Hindustan Unilever, Colgate Palmolive rose by between 0.08% to 5.31%. FMCG firms derive a substantial revenue from rural markets.

Some metal shares declined as copper prices fell on the London Metal Exchange. Tata Steel, Sterlite Industries, JSW Steel, Hindustan Zinc and Ispat Industries fell by between 0.89% to 7.06%. Copper for three-month delivery was down $165, or 3.6%, to $4,425 a metric tonne on the London Metal Exchange. The contract slid as low as $4,378, the lowest intraday price in almost two weeks.

Rate sensitive auto stocks fell on profit taking after a recent sharp surge. India's largest tractor maker by sales Mahindra & Mahindra fell 2.45%. India's largest commercial vehicle maker by sales Tata Motors fell 5.18%. India's largest car maker by sales Maruti Suzuki India fell 5.38%. India's largest motorbike maker by sales Hero Honda Motors fell 2.11% ahead of its Q4 March 2009 result today.

Rate sensitive real estate shares rose on hopes lower rates will spur housing demand. DLF, Indiabulls Real Estate and Housing Development & Infrastructure rose by between 2.84% to 5.44%. Most of the realty deals including sale of commercial property and housing sales is driven by finance.

Banking stocks fell in choppy trade on fears of rising defaults in a slowing economy. India's largest private sector bank by net profit ICICI Bank was down 6.51%. Its American depository receipts (ADR) fell 7.14% overnight. ICICI Bank's advance tax payment remained unchanged at Rs 250 crore in Q4 March 2009 when compared to Q4 March 2008.

India's biggest dedicated housing finance firm by operating income HDFC was down 0.39%.

India's largest bank in terms of assets and branch network State Bank of India (SBI) was down 3.13%. SBI chairman O.P. Bhatt today said interest rate cuts by the Reserve Bank of India were a signal for commercial banks to lower their rates. He said a decision on whether SBI would lower rates would be taken after a meeting of the bank's asset-liability. SBI's advance tax payment jumped 27.64% to Rs 1810 crore in Q4 March 2009 over Q4 March 2008.

India's second largest private sector bank by operating income HDFC Bank rose 1.84%. Its American depository receipt (ADR) fell 5.93% on Monday. Its advance tax payment rose 10% to Rs 275 crore in Q4 March 2009 over Q4 March 2008.

Axis Bank fell 3.22% even as its net profit rose 60.88% to Rs 581.45 crore on 51.04% rise in total income to Rs 3884.73 crore in Q4 March 2009 over Q4 March 2008.

The yield on the 10-year benchmark bond was at 6.29%, off a trough of 6.19% after the policy announcement, which was its lowest since 16 February 2009. It had traded at 6.34% ahead of the policy announcement, and had ended at 6.39% on Monday. Bond yields and bond prices are inversely related.

It may be recalled that many banks had reported robust Q3 December 2008 results on the back of treasury gains as bond prices soared. Bond yields and bond prices are inversely related.

Outsourcing focussed IT firms fell on fears a weak global economy would cut the amount firms spent on technology. India's second largest software services exporter Infosys Technologies fell 2.07%. Its ADR fell 3.11% overnight.

India's largest software services exporter by sales TCS fell 1.55% as its consolidated net profit as per Indian GAAP fell 1.58% to Rs 1152.34 crore on 1.44% fall in consolidated sales to Rs 7171.77 crore in Q4 March 2009 over Q3 December 2008. The company's consolidated net profit was up 4.5% at Rs 5256.4 crore on 21.6% rise in consolidated net sales at Rs 27812.9 crore in financial year ended March 2009 over financial year ended March 2008.

The company declared a total dividend of Rs 14 per share for financial year ended March 2009 including Rs 5 as final dividend. It closed 28 large deals during the year, added 163 new customers, made 24,885 campus offers for 2009-10 and has a total of 143,761 employees on its rolls. It announced liberal 1:1 bonus issue

India's third largest software services exporter, Wipro rose 0.24%. Its American depository receipt (ADR) fell 5.43% on Monday, 20 April 2009. India's fifth largest IT firm by sales HCL Technologies rose 0.84%%.

Capital goods stocks fell on worries a slowing economy will crimp orders. Larsen & Toubro, Bharat Heavy Electricals, ABB, Crompton Greaves, Praj Industries, Thermax fell by between 0.48% to 8.62%.

Punj Lloyd fell 8.62% after its UK-based unit lost a contract dispute to Sabic UK Petrochemicals in an interim ruling.

HealthCare stocks fell on profit taking after a recent solid surge triggered by expectations of better Q4 March 2009 results following reports of higher advance tax payment by these firms. Ranbaxy Laboratories, Dr Reddy's Laboratories, Biocon, Pfizer, Piramal HealthCare fell by between 0.4% to 6.29%.

Cals Refineries clocked the highest volume of 2.62 crore shares on BSE. Unitech (1.99 crore shares), Suzlon Energy (1.7 crore shares), Reliance Natural Resources (1.56 crore shares) and Housing Development & Infrastructure (1.39 crore shares) were the other volume toppers in that order.

Reliance Industries clocked the highest turnover of Rs 283,43 crore on BSE. Reliance Capital (Rs 255.26 crore), Educomp Solutions (Rs 205.02 crore), ICICI Bank (Rs 202.83 crore) and Housing Development & Infrastructure (Rs 187.23 crore) were the other turnover toppers in that order.

Pre Session Commentary - Apr 21 2009

Today domestic markets are likely to open with a negative gap on the back of bearish cues from the US markets that shattered badly yesterday as Bank of America reported first quarter credit loss provisions totaling $13.4 billion. Consequently the Asian markets have also opened with heavy blood bath. In the Domestic arena one may witness immense selling pressure during the first half of the trading session.

On Monday, domestic markets closed flat after last hour volatile session. Despite weak cues from the Asian markets the domestic investors showed strong buying sentiment in the first half of the trade. However the sheer profit booking pressures pulled the markets to southward. There was late buying across the bottom line stocks that helped the BSE Midcap and Smallcap steal the charm of the day’s trade. In the Sectoral indices Metal, CG, CD, Realty and Power gained by 2.53%, 1.79%, 1.65%, 1.52% and 1.33% respectively. On the other hand Bankex, FMCG and HC were the laggards. During the session we expect the markets to be trading negative.

The BSE Sensex closed with a loss of 43.59 points at 10,979.50 and NSE Nifty closed flat at 3,388.30. BSE Mid Caps and BSE Small Caps ended with gains of 56.31 points and 59.59 points at 3,528.91 and 4,011.15 respectively. The BSE Sensex touched intraday high of 11,209.66 and intraday low of 10,863.28.

On Monday, the US stock markets closed with heavy losses. Bank of America reported first quarter credit loss provisions of $13.4 billion up from almost $5 billion. There was heavy selling in the financial stocks which fell 11.4%. On the other hand Bank of America generated pretax, pre-provision of $19 billion. Diversified banks finished 15.6% lower and diversified services stocks sank 15.9%. Oracle was in the limelight after the company announced that it will acquire Sun Microsystems for $9.50 per share a premium of more than 40%. US light crude oil futures for May fell drastically by 8.8% at $45.90 per barrel on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) declined by 289.60 points to close at 7,841.73. The NASDAQ Composite (RIXF) index fell by 64.86 points to close at 1,608.21 and the S&P 500 (SPX) declined by 37.21 points to close at 832.39.

Today major stock markets in Asia are trading negative. Shanghai composite is low by 31.81 points at 2,525.64. Hang Seng is trading low by 540.02 points at 15,210.89 followed by Japan''s Nikkei which is low by 259.41 points at 8,665.34, Strait Times is low by 48.20 points at 1,826.65. While Taiwan Weighted is low by 13.87 points at 5,767.79 and Seoul Composite points is low by 14.30 points at 1,322.09 respectively.

Indian ADRs ended down. In technology sector, Infosys ended lower by 3.11% along with Wipro by 5.43%. Further, Patni Computers gained 0.90% whereas Satyam closed down by 2.66%. In banking sector ICICI Bank lost 7.14% and HDFC Bank dropped by 5.93%. In telecommunication sector Tata Communication and MTNL plunged 2.74% and 2.69% respectively. Sterlite Industries decreased by 3.51%.

The FIIs on Monday stood as net buyers in equity and net sellers in debt. Gross equity purchased stood at Rs 2,547.60 Crore and gross debt purchased stood at Rs 122.60 Crore, while the gross equity sold stood at Rs 1,758.80 Crore and gross debt sold stood at Rs. 798.70 Crore. Therefore, the net investment of equity and debt reported were Rs 789.10 Crore and Rs (676.10) Crore respectively.

On Monday, the Rupee closed at Rs. 50.33/34, 0.92% weaker than its previous close of Rs. 49.87/88. The rupee traded weaker as the stock markets pared off its early gains to end flat thus creating concerns of dollar inflow.

On BSE, total number of shares traded were 43.34 Crore and total turnover stood at Rs 4,749.97 Crore. On NSE, total number of shares traded was 97.69 Crore and total turnover was Rs 14,468.76 Crore.

Top traded volumes on NSE Nifty – Unitech with 93783652 shares, Suzlon Energy with 32686716 shares, SAIL with 17685349 shares, ICICI Bank with 16516692 shares followed by DLF with 13695257 shares.

On NSE Future and Options, total number of contracts traded in index futures was 1068857 with a total turnover of Rs 17,461.91 Crore. Along with this total number of contracts traded in stock futures were 516868 with a total turnover of Rs 19,128.89 Crore. Total numbers of contracts for index options were 1557022 with a total turnover of Rs 26,750.81 Crore and total numbers of contracts for stock options were 38483 and notional turnover was Rs 1,554.68 Crore.

Today, Nifty would have a support at 3,278 and resistance at 3,321 and BSE Sensex has support at 10,670 and resistance at 10,810

Asian stocks open negative, led by financial and mining cos

Asian stocks fell, led by financial and mining companies, as higher loan-loss reserves at Bank of America and a drop in commodity prices derailed optimism the global economy is recovering.

Orix Corp slid more than 6% after Nomura Holdings downgraded the shares. Mitsubishi Corp dropped more than 5% after the Nikkei newspaper said falling coal prices will erode profits.

Japanese benchmark index Nikkei fell 299.06 points, or 3.35%, to trade at 8,625.69.

Hong Kong`s Hang Seng index declined 574.38 points, or 3.65%, to trade at 15,176.53.

China`s Shanghai Composite slid 13.14 points, or 0.51%, to trade at 2,544.31.

Taiwan`s Taiex index dropped 94.36 points, or 1.63%, to trade at 5,687.30.

South Korea`s Kospi index slipped 25.30 points, or 1.89%, to trade at 1,311.09.

Singapore`s Straits Times decreased 56.57 points, or 3.02%, to trade at 1,818.28. (8.07 a.m., IST)

Market seen extending Monday's fall, RBI monetary policy eyed

Key benchmark indices are likely to extend Monday's fall on weak global cues. The SGX Nifty futures for April 2009 series lost 61.50 points in Singapore. The Reserve Bank of India's monetary policy meeting scheduled today, 21 April 2009, to review interest rates will be closely watched. Also companies that will be announcing their March 2009 quarterly results will see action.

With inflation slowing to around 20- year low in the first week of April 2009, analysts opine the central bank may cut interest rates further to boost slowing economy. The central bank's comments on the economic outlook, direction of interest rates and credit growth target will be closely watched by the market.

The central bank has cut its main short-term lending rate or repo rate by 400 basis points to 5% in five moves since October 2008.

Wholesale prices rose 0.18% in the week to 4 April 2009 from a year earlier after rising 0.26% the previous week, government data showed Thursday, 16 April 2009.

Hero Honda Motors, Rolta India, Seamec, Praj Industries, Spice Communications and UltraTech Cement among others will declare their March 2009 quarterly results today, 21 April 2009.

Also political uncertainty, with polling for India's 15th Lok Sabha underway, may lead to volatile swings on the bourses. The month-long parliamentary elections that began on 16 April 2009 will conclude on 13 May 2009 with results due on 16 May 2009. Poll estimates point to a fractured mandate.

Bank of America's concern took its toll on the Asian markets as well. Key benchmark indices in Hong Kong, China, Taiwan, Singapore, South Korea and Japan were down by between 0.50% and 3.44%.

US markets corrected sharply after Bank of America's rise in troubled loans reignited fears of the banking industry and the economy. The Dow Jones industrial average fell 289.60 points or 3.56%, Standard & Poor's 500 Index declined 37.21 points or 4.28% and Nasdaq Composite index declined 64.86 points or 3.88%.

Back home, profit booking is likely to continue after a recent solid rally, which saw the BSE 30-share Sensex surging 35.08% or 2862.69 points to 11,023.09 on 17 April 2009 from a 3-year closing low of 8,160.40 on 9 March 2009.

Key benchmark indices took a breather on Monday, 20 April 2009 on profit booking after a recent solid surge. Weak global cues also played the spoilsport. The BSE 30-share Sensex fell 43.59 points or 0.4% to 10,979.50 and the S&P CNX Nifty was down 7.30 points or 0.22% to 3,377.10, in what was a highly choppy trading session.

However the market sentiment remains firm due to sustained buying by foreign funds after heavy outflows in the first two months of calendar 2009. According to provisional data on NSE, foreign institutional investors (FIIs) were net buyers worth Rs 348.05 crore while domestic institutional investors funds bought shares worth Rs 108.90 crore on Monday, 20 April 2009.

FII inflow in April 2009 totaled Rs 4,277.10 crore (till 17 April 2009) cutting their outflow in calendar year 2009 to Rs 2,394.60 crore.

Daily News Roundup - Apr 21 2009

ArcelorMittal plans to cut the size of a planned steel plant in India by half and indefinitely defer the second plant. (BS)

The bauxite mines of NALCO at the Panchpatmali hills in Koraput district of Orissa are yet to restart operations after last week’s naxalite attack. (BS)

SEBI bars GHCL promoters and other top brass from stock market after investigations revealed that the company had filed false shareholding details. (BS)

Cipla won a patent fight against US-based Gilead Sciences on bird flu medicine in India. (BS)

NHAI alters bid process and project terms to lower risk for potential investors for the 19 highway projects. (BS)

Oracle Corp agreed to buy Sun Microsystems Inc for about US$7.4bn in cash. (BS)

The board of Axis Bank appointed Ms Shikha Sharma, MD, ICICI Prudential Life Insurance Company, as the bank’s new MD & CEO. (BL)

BHEL plans of picking up equity or even buying out forgings ventures in Eastern Europe and China. (BL)

Star Union Dai-ichi Life Insurance Co, formed jointly by Bank of India, Union Bank and Dai-chi Mutual Life, plans to infuse Rs8.5bn in the next five years. (BL)

TCS has announced bonus issue in the ratio of 1:1. (ET)

Indiabulls Real Estate has sold 15,730 sq ft area in its upcoming commercial complex at Lower Parel in central Mumbai for Rs300mn to British Council. (ET)

Power Grid Corporation plans to raise up to Rs30bn by issuing fresh shares by end of FY10. (ET)

Public sector power utilities NTPC, NHPC, Power Grid and Damodar Valley Corporation will jointly set up an online high power short circuit testing facility at a cost of Rs2.5bn. (ET)

Tata Teleservices has asked government to process its applications for GSM licences and spectrum in three circles - Assam, North East and J&K. (ET)

Vodafone and Onmobile have entered into an agreement which would enable Vodafone to use value-added services of Onmobile in emerging markets. (ET)

Reliance-ADAG’s DTH arm, Big TV to hire 15,000 tech professionals. (ET)

Tata Teleservices’ US$2bn capex plan for two years till 2010 for its GSM roll out and CDMA operations remains on track. (FE)

Tech Mahindra has ruled out any immediate job cuts among Satyam employees, but salary cuts are possible. (FE)

Air India has decided to cut fares by as much as 70% on 35 sectors starting today. (ET)

Jet Airways is planning to cut its fleet by nearly a fifth. (ET)

SEBI has barred the promoters of GHCL, along with its top management, from dealing the securities market until further orders. (ET)

Bajaj Finserv entered into a 49:51 JV agreement with Allianz Global Investors to foray into the mutual fund business. (FE)

Adani Power - an Adani Enterprises company is expected to re-file its draft red herring prospectus with SEBI for its proposed Rs22bn IPO soon. (ET)

JNPT has signed a sister port agreement with Spain-based Gijon port authority. (ET)

BEML has set up an assembly unit in Brazil. (ET)

Oracle to buy Sun Microsystems for US$7.4bn. (ET)

The RBI survey said that the economy will grow at 5.7% in FY10. (BS)

Retail loan growth drops to single-digit level in FY09. (BS)

The Government will soon give infrastructure status to the tourism sector. (FE)

Bulls seek a stimulus in sentiment!

Between stimulus and response is our greatest power - the freedom to choose

The RBI may well choose not to respond to the pleas of the bulls. Expectations are that a status quo could be maintained like in many earlier policies and action would be initiated at an ‘appropriate time’ later. Given that the lending activity has not picked up as much as RBI would like to see despite the liquidity easing, the central bank may choose to ask banks to lend more to specific sectors.

The markets have expectedly turned choppy. Given the gains in recent weeks, a cool-off was always on the cards. How the RBI plays its cards today will determine the further course of action (just for the day).

The market is likely to open weak. The global cues are adding to the discomfort. US markets tumbled snapping a six-week long rally on concerns about the financial sector earnings.

Bank of America Corp slumped 24%, Citigroup Inc. declined 19%, U.S. Steel Corp. and Exxon Mobil Corp. also were major losers as oil and industrial metal prices decreased.

The Dow Jones industrial average fell 290 points, or 3.6%. The S&P 500 index declined 37 points, or 4.3% and the Nasdaq composite was down 65 points, or 3.9%.

In Asia, equity markets lost ground in the morning trades following a steep decline in the US. The fall was led by the financial and mining stocks. Orix Corp fell 6%, BHP Billiton fell 3.6% and Mitsubishi Corp slipped 5% were among the major losers.

The Nikkei index in Japan was down 299 points or 3.3% at 8,625.6, the Hang Seng index in Hong Kong fell 551 points or 3.5% at 15,210, however, the Shanghai SE Composite was flat at 2,551.

Results today: Wipro, Hero Honda, HCL Tech, Praj Industries, Rolta, Ultra-tech

Second rung stocks seem to be outperforming the main indices. Metals, capital goods and realty space were among the gainers on Monday.

The US Food and Drug Administration found nine deviations in Cipla’s manufacturing process during a recent inspection of its Bangalore plant, according to a report. The company, however, said the deviations are minor ones.

Power Grid Corporation plans a capex of Rs 120bn for the current fiscal year, much higher than the Rs90bn spent in the previous year.

Jet Airways and Kingfisher airlines raised fuel surcharge on domestic flights following a hike in ATF. The scrips were up 4.5 per cent and 8 per cent respectively.

Vakrangee Softwares gained after it said it expects revenue of about $15.67 million during the fiscal year 2009-10 from a tripartite agreement with 1 Document Corporation and IL&FS Technologies.

PSU refiners are likely to cut diesel imports and buy from Reliance Industries, which has started looking at the domestic market, Petroleum Secretary R.S. Pandey was quoted as saying. It may be recalled that RIL surrendered the export status, and the associated tax benefits.

In an age of firing, reports say as many as 28 American companies in the Fortune 100 list including

retail giant Wal-Mart, Time Warner and beverage company Coca-Cola are still hiring.

IndiGo on Monday said there is no truth in reports that its competitor Spicejet is acquiring 7.5 per cent stake in it.

Oracle announced it will buy Sun Microsystems in a deal worth $7.4 billion.

PepsiCo offered $6bn to buy out shareholders of its two largest bottlers, Pepsi Bottling Group and PepsiAmericas.

GlaxoSmithKline (GSK) agreed to pay up to $3.6bn for independent skincare specialist Stiefel Laboratories. Stiefel is partly owned by private equity firm Blackstone Group.

Bank of America reported earnings of 44 cents a share, better than expectations. However, the stock and the markets cracked as the bank warned of deteriorating credit quality.

Highly volatile market ended on a flat note on Monday. It was a day of wild gyrations as alternate bouts of buying and selling often tossed the key indices into the red and green. The BSE Sensex swung over 340 points and the NSE Nifty gyrated 45 points between their intra-day high’s and low’s. The BSE Sensex slipped 43 points to close at 10,979 and the NSE Nifty ended lower by 7 points at 3,377.

Among the 30-components of Sensex, 19 ended in negative terrain and 11 ended in the green. Among the major loser were, ICICI Bank, ITC, HDFC, NTPC and TCS.

Among the major gainers were L&T, Bharti Airtel, Reliance Infra, JP Associates and Sterlite Industries.

Among the BSE Sectoral indices BSE Banking index was the top loser, the index lost 1%. Among the other major loser were BSE FMCG index (down 0.8%) and BSE Pharma index (down 0.3%).

Bucking the negative trend were, BSE Metal index (up 2.5%), BSE Capital Goods index (up 1.8%) and BSE Realty index (up 1.5%)

Market breath was positive, 1,495 advanced against 1,033 declines, while, 86 remained unchanged.

All eyes would be on the Reserve Bank of India as the monetary policy would to be unveiled on Tuesday. A rate cut may well boost some sentiment for the markets in the short term. The RBI, however, is likely to maintain a status quo considering that despite ample liquidity, credit offtake has remained lesser than desired.

Market may resume weak

The market is monitoring the international markets for further direction and the weakness across the global markets may drag down the local indices. The market may open in negative territory following the slump in Asian markets in morning trades. However, after posting significant gains in last sessions, buying interest may continue on the back of firm trend. Among the key local indices, the Nifty has good support around 3330-3280 levels and upside till 3430-3430 levels. The Sensex has a likely support at 10850 and may face resistance at 11150.

US indices slipped tumbled on Monday as a six-week old rally lost steam on worries about financial sector earnings, despite Bank of America's better-than-expected quarterly results. As a result
the Dow ended lower at 7842 down 290 points, while the tech-laden Nasdaq declined to close 65 points lower at 1608.

Indian floats, also, bucked the weak US market trend and ended lower. ICICI Bank and HDFC Bank lost 7.14% & 5.93% respectively, while Wipro, Tata Motors, Dr Reddy's, Infosys, Satyam, Rediff, VSNL and MTNL also lost above 2-3% each, Patni Computer however, was the only gainers amongst the ADRs and gained by 0.90% respectively.

Crude oil prices in the international market edged lower, with the Nymex light crude oil for May delivery lost by $4.45 to close at $45.88 per barrel. In the commodity space, the Comex gold for June series advanced $19.60 to settle at $887.50 a troy ounce.

Morning Calls - Apr 21 2009

Morning Calls - Apr 21 2009



India Strategy - Politics - Apr 18 2009

India Strategy - Politics - Apr 18 2009



Bullion metals gain despite strong dollar

Bank of America's earning report details rekindles credit fears

Despite a strong dollar, bullion metals ended higher on Monday, 20 April, 2009. Prices rose as earning report from Bank of America once again raised concerns about the overall economic scenario thereby increasing the appeal of precious metals as an alternate source of investment.

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 Monday, Comex Gold for June delivery rose $19.6 (2.3%) to close at $887.5 an ounce on the New York Mercantile Exchange. Last week, gold ended lower by 1.7%. Year to date, gold prices are higher by 0.3%.

For the month of March, gold fell 2.1%, down for the first month in five. But the metal gained 4.3% in the first quarter. Before March, for the month of February, gold ended higher by 7.4%. For January, 2009, gold had gained 3.9%.

On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped somewhat (16%) since then.

On Monday, Comex silver futures for May delivery gained 31.5 cents (2.7%) at $12.105 an ounce. Year to date, silver has climbed 6.6% this year. For 2008, silver had lost 24%.

On Monday, Bank of America rekindled fear about credit deterioration. Bank of America increased its credit loss provisions to $13.4 billion in the first quarter from $8.5 billion in the fourth quarter.

In the currency market today, the dollar index gained 0.9% today.

In 2008, gold prices ended higher by 5.5%. The dollar index had gained 12% that year.

Last year, the weakening dollar and higher global demand for raw materials had led to records for commodities including gold. Gold reached a record in March 2008 as a U.S. housing slump and credit crisis spurred the Federal Reserve to slash borrowing costs. In the last move, the Federal Reserve has cuts its target bank lending rate to 0.25% from 5.25% in September, 2007. The Fed did it in nine steps.

Prior to 2008, gold had witnessed the greatest annual gain in twenty eight years by gaining $200/ounce (31%) in FY 2007 as lower interest rates had sent the dollar tumbling, and crude-oil prices rose to a record. Silver had climbed 16% in FY 2007. In 2006, silver had jumped 46% while gold gained 23%.

At the MCX, gold prices for June delivery closed higher by Rs 384 (2.7%) at Rs 14,415 per 10 grams. Prices rose to a high of Rs 14,469 per 10 grams and fell to a low of Rs 13,988 per 10 grams during the day's trading.

At the MCX, silver prices for May delivery closed Rs 493 (2.5%) higher at Rs 20,371/Kg. Prices opened at Rs 19,865/kg and rose to a high of Rs 20,480/Kg during the day's trading.

Crude plunges

Prices end substantially lower as recession worries come back

Crude oil dropped substantially at US on Monday, 20 April, 2009. Prices fell as traders once again started worrying about the current economic scenario. Prices fell today as earning report from Bank of America once again raised concerns about the overall economic scenario. The strong dollar and last week's inventory report also hampered crude prices today.

On Monday, crude-oil futures for light sweet crude for May delivery closed at $45.88/barrel (lower by $4.45 or 8.8%) on the New York Mercantile Exchange. Last week, crude ended lower by 3.7%.

Crude ended March trading up 10.9%. It rallied 11.3% in the first quarter. 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 68.8% since then. Year to date, in 2009, crude prices are higher by 4.8%. On a yearly basis, crude prices are lower by 57%.

On Monday, Bank of America rekindled fear about credit deterioration. Bank of America increased its credit loss provisions to $13.4 billion in the first quarter from $8.5 billion in the fourth quarter.

In the currency market today, the dollar index gained 0.9% today.

Last week, the EIA had reported that crude inventories rose 5.6 million barrels in the week ended 10 April, 2009. Market was expecting an increase of 2.5 million barrels. At 366.7 million barrels, U.S. inventories stood at the highest level since September 1990.

Also at the Nymex on Monday, May reformulated gasoline fell 8.08 cents, or 5.4%, to $1.4119 a gallon and May heating oil dropped 9.09 cents, or 6.4%, to $1.3316 a gallon.

May natural-gas futures dropped 18.9 cents, or 5.1%, to $3.54 per million British thermal units.

Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.

At the MCX, crude oil for May delivery closed at Rs 2,481/barrel, lower by Rs 141 (1.4%) against previous day's close. Natural gas for April delivery closed at Rs 188.6/mmbtu, lower by Rs 6.6/mmbtu (3.4%).

SGX Nifty Live Update - Apr 21 2009

SGX Nifty at 3,325.0 -51.5