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Tuesday, May 12, 2009
Cautious session sees Asia sliding in patches
Markets unable to extend gains as recent upside seen mostly overdone
Asian stocks witnessed a cautious session today, with some of the markets giving up their recent gains as profit selling emerged on negative cues from the US markets and ideas that the recent run up might be a little overdone for the global equities. US stocks slid lower yesterday, giving up most of their smart gains on Friday after the economy shed jobs at the least pace in six months. The banking stocks were under pressure and the Dow Jones Industrial Average ended lower by 155.88 points, or 1.82%, to 8,418.77.
Financials mimicked a similar pattern in Asia as well. Japan's Nikkei 225 was down 1.4% though the economic data came on the positive side. The composite index of leading economic indicators compiled using data such as the number of new job offers and consumer sentiment was up 2.8% to 76.6 in March from 74.5 recorded in February which gives a slight relief to the Japanese economy. The figure registers a rise for the first time in seven months.
China's exports slumped for the sixth straight month amid warnings that weak overseas demand was hindering a recovery, even as government spending helped boost factory investment. The 22.6 percent drop in exports in April from a year earlier, to $91.9 billion, was bigger than March's 17 percent drop and suggested that China's trade sector has seen inadequate relief from the prolonged drought in demand brought on by the global downturn. China's Shanghai Composite failed to get bogged down by this piece of information though and ended up 1.50% on the day.
In South Korea, South Korea's central bank held interest rates steady for a third consecutive month at a record low of 2.00 percent, as expected, preferring to wait and see how previous rate cuts are affecting the economy amid recent signs of stabilization. The Bank of Korea kept rates on hold in both in March and April after slashing the base rate by a total of 3.25 percentage points from October to February as the global financial crisis hammered export demand. Korea's Kospi Composite 0.7% lower.
In other markets, Taiwan's main index was down 2.5%, Indonesian Jakarta Composite slipped 0.20% while Malaysia's KLSE composite dropped 0.24% while Australia's S&P/ASX 200 was off 1.5% and New Zealand's NZX-50 down 0.4%. In Singapore, the Straits Times Index was down 0.6% and Philippine shares were down 0.5%. Indonesian shares slipped 0.4%.
Yesterday, Federal Reserve Chairman Ben Bernanke, in comments made after a speech defending the bank sector stress tests, said the U.S. dollar would be strong, and was likely to stay the chief reserve currency.
In commodities, crude oil rallied as the US dollar slipped further. Front-month NYMEX crude oil rallied after its overnight fall and hit $59.68- its highest level in nearly seven months.
Turnover surges
Nifty May 2009 futures at premium
Nifty May 2009 futures were at 3,697.40, at a premium of 16.30 points as compared to the spot closing of 3,681.10. Turnover in NSE's futures & options (F&O) segment surged to Rs 53,677.79 crore from Rs 45,810.47 crore on Monday, 11 May 2009.
ICICI Bank May 2009 futures were at premium at 563.55 compared to the spot closing of 558.10.
State Bank of India May 2009 futures were at premium at 1,301.80 compared to the spot closing of 1,295.15.
Axis Bank May 2009 futures were at discount at 667.25 compared to the spot closing of 669.
In the cash market, the S&P CNX Nifty gained 126.50 points or 3.56% at 3,681.10.
Post Session Commentary - May 12 2009
Indian market rebounded sharply from its initial weakness to end the day with handsome gains on strong buying emerged during final trading hours. Recovery in European markets along with higher US index futures, also contributed to positive sentiments. However, data showing fall in industrial output in March 2009, fueled some negative attitude during mid session. Further, market recovered and extended gains after the government revised the industrial production for February 2009 to a 0.7% fall as compared to the decline of 1.2% earlier.
The market opened on weak note tracking unfavorable cues from the global markets. The US stock markets on Monday closed lower retreating from four-month high, with the financial sector came into pressure as several major banks said they would sell shares to repay government bailout funds. Asian markets were also lower in early trade. However, the Indian benchmark indices gained ground soon after start to trade in positive terrain. Further, market again touched the dotted line due to fall in industrial output for March 2009. However, market managed to gather the momentum and continued to extend gains till end on revision in industrial production for February 2009. Finally market ended near day’s high backed by huge buying interest over the ground. BSE Sensex ended above 12,100 level and NSE Nifty above 3,650 mark. From the sectoral front, investors on-loaded positions across the sectors. Besides, Teck, IT, Bank, Oil & Gas, Reality, Power, Capital Goods and Consumer Durables stocks contributed to most of the buying. Mid Cap and Small Cap stocks also remained on buyers’ radar.
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 positive as 1410 stocks closed in green while 1101 stocks closed in red and 75 stocks remained unchanged in BSE.
The BSE Sensex closed higher by 475.04 points at 12,158.03 and NSE Nifty ended up by 126.50 points at 3,681.10. BSE Mid Caps and Small Caps closed with gains of 34.82 and 55.39 points at 3,746.24 and 4,240.71 respectively. The BSE Sensex touched intraday high of 12,194.63 and intraday low of 11,625.39.
Gainers from the BSE Sensex pack are HDFC (7.66%), Wipro (7.40%), ICICI Bank (6.72%), Bharti Airtel (6.23%), Infosys Tech (5.51%), Reliance (5.32%), Hindalco (5.31%), BHEL (5.12%), JP Associates (4.24%), M&M Ltd (4.13%), RCom (4.04%), HDFC Bank (3.92%), Tata Motors (3.89%) and Reliance Infra (3.87%).
Only loser from the BSE Sensex pack is HUL (0.44%).
India''s industrial production plunged 2.3% in March from 5.5% rise in the same month of 2008 and as against a decline of 0.7% in February. The government revised the industrial production for February 2009 to a 0.7% fall compared to the decline of 1.2% earlier. 23% fall is the worst performance for the IIP since January 1993. The plunge is mainly due to weak performance by the manufacturing sector, the output of which contracted by 3.3 per cent during March. The capital goods sector was the worst hit which fell 8.2% against growth 20.3% in the same period a year ago.
On the global markets front the Asian markets which opened before the Indian market, ended mixed. Hong Kong shares were supported by HSBC Holdings after a sharp upbeat trading report on Monday. However, Japanese and South Korean stocks dropped as investors booked profits in financial shares after recent gains. Shanghai Composite, Hang Seng and Straits Times index ended up by 38.43, 65.69 and 12.03 points at 2,618.17, 17,153.64 and 2,178.13 respectively. However, Nikkei 225 and Seoul Composite ended lower by 153.37 and 11.65 points at 9,298.61 and 1,403.51 respectively.
European markets which opened after the Indian market are trading mixed. In Frankfurt the DAX index is trading higher by 25.96 points at 4,892.87 while in London FTSE 100 is trading down by 9.49 points at. 4,426.01.
The BSE IT stocks also advanced by (5.19%) or 140.06 points to close at 2,836.77 weak rupee boosts revenues of IT firms in rupee terms as IT companies earn most of revenue from exports. Wipro Ltd (7.40%), Financ Tech (5.52%), Infosys Tech (5.51%), Mphasis Ltd (5.02%) and Moser Bayer (3.39%) ended in positive territory.
The BSE Teck index increased by (5.04%) or 110.32 points at 2,297.63. Main gainers are Wipro Ltd (7.40%), Bharti Airtel (6.23%), Idea Cell (5.57%), Financ Tech (5.52%) and Infosys Tech (5.51%).
The BSE Bank index gained (4.83%) or 288.82 points to close at 6,250.68. Major gainers are Kotak Bank (9.47%), Axis Bank (8.17%), Allahabad Bank (7.34%), ICICI Bank (6.72%) and PNB (5.93%).
The BSE Oil & Gas index gained (3.97%) or 330.49 points at 8,660.19. Scrips that gained are Reliance (5.32%), Reliance Pet (5.17%), Gail India (3.89%), HPCL (3.67%) and Cairn Indi (2.06%).
The BSE Realty index ended up by (3.77%) or 84.30 points to close at 2,317.57 on hopes that lower rates will spur housing demand. Gainers are Housing Dev (8.16%), Unitech Ltd (6.03%), Orbit Co (4.32%), DLF Ltd (3.55%) and Mahindra Life (3.09%).
The BSE Power ended higher by (3.02%) or 64.39 points at 2,199.87. Gainers are Suzlon Energy (8.02%), BHEL (5.12%), RPower (4.41%), Power Grid (4.06%) and Reliance Infra (3.87%).
Infrastructure Development Finance Company Ltd advanced 3.72% after a block deal of 5.28 lakh shares was executed on BSE at Rs. 88.25 per share.
United Breweries Ltd jumped 5.01% on reports the company will bottle and distribute Heineken brands in India and will get a one-time fee of Rs. 300 crore.
TCS ended up by 3.57%. The company announced that Forrester, an independent research firm, cited TCS as a leader in its April 2009 report titled "The Forrester Wave".
Nucleus Software Exports Ltd advanced 1.40%. The company has acquired a new client, the Bank of Bahrain and Kuwait (BBK), one of the largest commercial banks in Bahrin. Company’s cash management solution CASH@WILL and BankONet modules, will be implemented by the Bank of Bahrin and Kuwait for the transaction banking services.
Patni Computer gained 0.21%. The company announced that its iCAPA Solution 2.0 for life sciences has achieved SAP certification as powered by the SAP NetWeaver technology platform.
KEC International advanced by 4.22%. The company has bagged three orders totaling to Rs 111 crores in the Middle East, Australia and India.
JSW Steel ended down by 1.39% on the back of a decision to sell its plants in the US to cut rising losses, after a sharp fall in demand triggered by the global economic slump.
BSE Bulk Deals to Watch - May 12 2009
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
12/5/2009 531897 ACCENT TECH FIRST CALL INDIA EQUITY ADVISORS PVT LTD S 122263 74.48
12/5/2009 517001 BIRLA POWER JMP SECURITIES PVT LTD B 2664876 3.12
12/5/2009 517001 BIRLA POWER JMP SECURITIES PVT LTD S 4044816 3.12
12/5/2009 531367 DOLLEX INDUT MUKKARAM JAN S 60365 4.53
12/5/2009 532984 ENSO SECUT VSB INVESTMENTS PVT LTD B 75000 20.00
12/5/2009 532984 ENSO SECUT RIDHIMA G S 74870 20.00
12/5/2009 532996 FIRST WIN HARISHBHAIPATEL B 186770 16.50
12/5/2009 532996 FIRST WIN SHOBHAIMTIYAZDESAI S 100000 16.50
12/5/2009 532996 FIRST WIN IMTIYAZIBRAHIMBHAIDESAI S 100000 16.50
12/5/2009 532873 HOUSING DEV GENUINE STOCK BROKERS PVT. LTD. B 1622168 170.71
12/5/2009 532873 HOUSING DEV GENUINE STOCK BROKERS PVT. LTD. S 1622168 170.76
12/5/2009 532832 INDBUL REAL JP MORGAN SECURITIES LTD S 1375000 143.36
12/5/2009 516078 JUMBO BAG LT RUSHAB RAVJI PATEL B 40000 25.65
12/5/2009 516078 JUMBO BAG LT NIKHILSSHAH S 122801 25.95
12/5/2009 532081 K SERA SERA EDELWEISS ESTATES P LTD B 500000 10.79
12/5/2009 532081 K SERA SERA EDELWEISS ESTATES P LTD S 447655 10.80
12/5/2009 504269 KHAITAN ELCT KHAITAN LEFIN LTD B 107000 65.34
12/5/2009 504269 KHAITAN ELCT ARION COMMERCIAL PVT LTD S 100000 65.35
12/5/2009 532675 PRITHVI INFO ARJUN RAMESH S 133243 46.12
12/5/2009 507649 RASOI LTD UNITED MACHINE CO LIMITED B 69000 289.06
12/5/2009 507649 RASOI LTD GITADEVIDALMIA B 91000 290.84
12/5/2009 507649 RASOI LTD FOLLOWEL ENGINEERING LIMITED B 175000 288.10
12/5/2009 507649 RASOI LTD ADITYASHROFF B 47700 295.36
12/5/2009 507649 RASOI LTD GEMINI VINTRADE PVT. LTD. S 37500 293.54
12/5/2009 507649 RASOI LTD TEJASWI VINIMAY PVT LTD S 56000 290.94
12/5/2009 507649 RASOI LTD BSR FINANCE & CONSTRUCTIONS LTD S 25500 288.21
12/5/2009 507649 RASOI LTD JAIDEEPHALWASIYA S 250208 288.88
12/5/2009 512048 SPLASH MEDIA BHANUMATIDHARAMRAJGIRI B 16227 47.12
12/5/2009 512048 SPLASH MEDIA SUNIL BHANDARI S 10000 47.10
12/5/2009 512048 SPLASH MEDIA REKHA BHANDARI S 11000 47.05
12/5/2009 531390 UPSURGE INVS KIRIT V DAVE S 65000 5.66
12/5/2009 531874 VENUS VENT HIMAL KANCHANLAL PARIKH HUF B 33525 30.49
NSE Bulk Deals to Watch - May 12 2009
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
12-MAY-2009,3IINFOTECH,3i Infotech Limited,ADROIT FINANCIAL SERVICES PRIVATE LIMITED,BUY,795758,58.28,-
12-MAY-2009,3IINFOTECH,3i Infotech Limited,ADVENT STOCK BROKING PRIVATE LIMITED,BUY,781887,57.06,-
12-MAY-2009,BAJAJHIND,Bajaj Hindusthan Ltd,ADROIT FINANCIAL SERVICES PRIVATE LIMITED,BUY,750177,110.27,-
12-MAY-2009,BALRAMCHIN,Balrampur Chini Mills,HSBC EQUITY FUND,BUY,1468800,78.66,-
12-MAY-2009,BIRLAPOWER,Birla Power Solutions Ltd,ADROIT FINANCIAL SERVICES PRIVATE LIMITED,BUY,4510541,3.23,-
12-MAY-2009,BIRLAPOWER,Birla Power Solutions Ltd,JMP SECURITIES PVT LTD,BUY,3535609,3.22,-
12-MAY-2009,FIRSTWIN,First Winner Industries L,HARISHBHAI K PATEL,BUY,204469,16.52,-
12-MAY-2009,HDIL,Housing Development and I,GENUINE STOCK BROKERS PVT LTD,BUY,1751646,170.54,-
12-MAY-2009,ISPATIND,Ispat Industries Limited,JAYPEE CAPITAL SERVICES LTD.,BUY,9905785,14.85,-
12-MAY-2009,KHAITANELE,Khaitan Electricals Ltd,KHAITAN HOTELS PVT LTD,BUY,90000,65.53,-
12-MAY-2009,KSERAPRO,K Sera Sera Productions L,ALKA INDIA LIMITED,BUY,500000,10.80,-
12-MAY-2009,WWIL,Wire and Wireless (India),ADROIT FINANCIAL SERVICES PRIVATE LIMITED,BUY,1378992,15.52,-
12-MAY-2009,3IINFOTECH,3i Infotech Limited,ADROIT FINANCIAL SERVICES PRIVATE LIMITED,SELL,785480,58.58,-
12-MAY-2009,3IINFOTECH,3i Infotech Limited,ADVENT STOCK BROKING PRIVATE LIMITED,SELL,717087,57.99,-
12-MAY-2009,BAJAJHIND,Bajaj Hindusthan Ltd,ADROIT FINANCIAL SERVICES PRIVATE LIMITED,SELL,733077,110.30,-
12-MAY-2009,BIRLAPOWER,Birla Power Solutions Ltd,ADROIT FINANCIAL SERVICES PRIVATE LIMITED,SELL,4510053,3.28,-
12-MAY-2009,BIRLAPOWER,Birla Power Solutions Ltd,JMP SECURITIES PVT LTD,SELL,3522389,3.25,-
12-MAY-2009,FIRSTWIN,First Winner Industries L,IMTIYAZ IBRAHIM DESAI,SELL,100000,16.50,-
12-MAY-2009,FIRSTWIN,First Winner Industries L,SHOBHA IMTIYAZ DESAI,SELL,100000,16.50,-
12-MAY-2009,HDIL,Housing Development and I,GENUINE STOCK BROKERS PVT LTD,SELL,1751646,170.65,-
12-MAY-2009,IBREALEST,Indiabulls Real Estate Li,COPTHALL MAURITIUS INVESTMENT LTD,SELL,2325000,143.48,-
12-MAY-2009,ISPATIND,Ispat Industries Limited,JAYPEE CAPITAL SERVICES LTD.,SELL,9309250,14.86,-
12-MAY-2009,KHAITANELE,Khaitan Electricals Ltd,ARION COMMERCIAL PVT LTD,SELL,100000,65.55,-
12-MAY-2009,WWIL,Wire and Wireless (India),ADROIT FINANCIAL SERVICES PRIVATE LIMITED,SELL,1378992,15.50,-
Sensex scales 7-month high as blue chips rally
Speculation that the Bharatiya Janata Party (BJP)-led National Democratic Alliance (NDA) is gaining momentum in the ongoing parliamentary elections triggered a solid surge on the domestic bourses. Firm global stocks and buying by foreign funds supported the rally. Index heavyweight Reliance Industries galloped. Banking, IT, capital goods and realty stocks surged. The BSE 30-share Sensex jumped 475.04 points or 4.07% up close to 535 points from the day's low.
The Sensex crossed the psychological 12,000 mark as the market witnessed a sharp surge in late trade. The Sensex attained its highest closing in more than seven months.
Data showing a strong growth in consumer durables production in March 2009 reinforced expectations of a recovery of the economy. Production of consumer durables jumped 8.3% in March 2009 as compared to a 2% decline in March 2008. Overall, India's industrial output fell a steeper-than-expected 2.3% in March 2009 over March 2008, its third fall in four months. The manufacturing segment shrank by 3.3%. Mining rose by a modest 0.4% and electricity output climbed by a decent 6.3%.
The industrial production figure for February 2009 was revised to a 0.7% drop from a preliminary estimate of a 1.2% decline. Industrial output rose 2.4% the 2008/09 fiscal year (April-March), down from a revised 8.5% in 2007/08.
The stock market was volatile. Data showing heavy buying by foreign funds on Friday, 8 May 2009, helped domestic bourses shrug off weak global equities in early trade. But the market slipped into the red for a brief period in morning trade. It soon bounced back. Data showing a steeper-than-expected fall in industrial output in March 2009 pulled the market off the higher level in early afternoon trade.
The market regained strength shortly after the industrial production data showed a sharp surge in production of consumer durables in March 2009. The market extended gains in afternoon trade as some European stocks moved into the green from red. The market soared in late trade.
Fears of a fractured mandate from the parliamentary polls had triggered a 3.58% fall in the BSE Sensex in the past two trading sessions. The the month-long parliamentary elections that began on 16 April 2009 will conclude on Wednesday, 13 May 2009. Exit polls will be announced after the last round of voting ends on Wednesday and the election results are due on Saturday, 16 May 2009.
A party/alliance needs 272 seats in the 543-member parliament to claim power at the Centre. Consumption and investment decisions will be significantly impacted by any signs that the new government is unstable.
Heavy buying by foreign funds has bolstered sentiment on the stock markets. Foreign funds are aggressively buying Indian stocks. FIIs bought shares worth a net Rs 182.50 crore on Monday, 11 May 2009. FII inflow in May 2009 totaled Rs 4,692.70 crore (till 11 May 2009). FII inflow in calendar year 2009 totaled Rs 5,405.50 crore (till 11 May 2009).
European shares rose on a view that the worst may be over for the global economy. A latest stronger-than-expected economic data in China reinforced that view. Key benchmark indices in France and Germany rose by between 0.07% to 0.69%. But UK's FTSE 100 fell 0.37%.
UK same-store sales rose 4.6% in April 2009, the fastest rate of growth in three years, the British Retail Consortium (BRC) said. In April 2008, sales were very weak in the cold wet weather after Easter fell in March, the BRC said.
Asian stocks were mixed. Key benchmark indices in Japan, South Korea and Taiwan fell by between 0.82% to 3.23%. Key benchmark indices in Singapore and Hong Kong rose by between 0.38% to 0.56%.
China's Shanghai Composite rose 1.49% in choppy trade after the latest data showed China's urban fixed-asset investment climbed 30.5% during January-April 2009 from a year earlier as the government pumped money into building railways, oil pipelines and low-cost housing.
China's copper imports rose 7% to a record in April as buyers replenished stockpiles. Aluminum shipments almost tripled, the Beijing-based customs office said today. The Chinese government is spending 4 trillion yuan ($586 billion) to stimulate growth.
On the flip side, China's exports contracted 22.6% in April 2009 from a year earlier, accelerating from a 17.1% slide March 2009. Imports were down 23% on year, compared to a 25.1% decline in March 2009, according to data released Tuesday by the National Bureau of Statistics.
Meanwhile, the Bank of Korea's monetary policy committee left interest rates unchanged on Tuesday at a record low of 2% for a third-straight month on continued signs of improvement in the South Korean economy. The move was widely expected.
Trading in US index futures showed the Dow could rise 5 points at the opening bell on Tuesday, 12 May 2009. Dow futures were in the red earlier in the day.
US stocks fell on Monday 11 May 2009 due to profit taking after a two-month run-up, while news of several share offerings weighed on banks as investors worried about their dilutive impact on current shareholders. The Dow declined 155.88 points, or 1.8%, to 8,418.77. The S&P 500 index declined 19.99 points, or 2.2%, to 909.24. The tech-focused Nasdaq composite index was down 7.76 points, or 0.5%, to 1,731.24.
The BSE 30-share Sensex jumped 475.04 points or 4.07% to 12,158.03, its highest closing since 3 October 2008. The Sensex rose 511.64 points at the day's high of 12,194.63 in late trade. At the day's low of 11,625.39, the Sensex fell 57.60 points in early trade.
The S&P CNX Nifty was up 126.50 points or 3.56% to 3,681.10.
From 9,647.31 on 31 December 2008, the BSE Sensex has risen 2510.72 points or 26.02% in calendar year 2009.
The market breadth, indicating the overall health of the market, turned positive from a negative breadth earlier in the day. On BSE, 1,416 shares rose as compared with 1,119 that fell. A total of 56 shares remained unchanged.
From the 30 share Sensex pack, 29 stocks rose and rest fell.
BSE clocked a turnover of Rs 4,919 crore, higher than Rs 4,380.10 crore on Monday, 11 May 2009.
Nifty May 2009 futures were at 3,697.40, at a premium of 16.30 points as compared to the spot closing of 3,681.10. Turnover in NSE's futures & options (F&O) segment surged to Rs 53,677.79 crore from Rs 45,810.47 crore on Monday, 11 May 2009.
The BSE Mid-Cap index rose 0.94% and the BSE Small-Cap index gained 1.32%. However, both the indices underperformed the Sensex.
The BSE IT index (up 5.19%), the BSE TECk index (up 5.04%), the BSE Bankex (up 4.83%), outperformed the Sensex.
The BSE FMCG index (up 1.02%), the BSE Healthcare index (up 1.33%), the BSE Auto index (up 1.76%), the BSE PSU index (up 1.79%), the BSE Consumer Durables index (up 1.8%), the BSE Metal index (up 2.12%), the BSE Capital Goods index (up 2.72%), the BSE Power index (up 3.02%), the BSE Realty index (up 3.77%), the BSE Oil & Gas index (up 3.97%), underperfomed the Sensex.
India's largest private sector firm by market capitalisation and oil refiner Reliance Industries (RIL) rose 5.32% to Rs 1,958.30. Analysts expect strong growth in bottom line in coming quarters from sale of gas which it started pumping last month from its deep-sea field off the east coast.
Ratnagiri Gas & Power, which supplies electricity to the western Indian state of Maharashtra, on Friday, 8 May 2009, agreed to buy natural gas from an offshore field operated by Reliance Industries.
PSU OMCs rose on fall in oil prices. BPCL, Indian Oil Corporation and HPCL rose by between 1.53% to 3.67%. Oil fell for a second day in a row on Monday, 11 May 2009, as a drop in US equities signaled the global economy and fuel consumption may not recover anytime soon. Crude oil for June delivery fell as much as 69 cents, or 1.2%, to $57.81 a barrel, and traded at $58.01 on the New York Mercantile Exchange. Lower oil prices will reduce underrecoveries at the state-run oil firms on domestic sale of petrol, diesel, LPG and kerosene at a controlled price.
Bank stocks surged boosted by strong Q4 March 2009 results by State Bank of India (SBI), India's biggest bank in terms of branch network, during the weekend. State Bank of India (SBI), India's biggest bank in terms of branch network rose 2.76%. State Bank of India reported a forecast-beating 45.6% rise in net profit to Rs 2742.31 crore on a 34.6% increase in operating income to Rs 22060.61 crore in Q4 March 2009 over Q4 March 2008. Profit was boosted after gains from trading trebled and loan demand soared as borrowers scrambled for funds in a slowing economy. The bank announced the results on Saturday, 9 May 2009.
India's largest private sector bank by net profit ICICI Bank rose 6.72% even as its American depository receipt (ADR) fell 3.52% on Monday, 11 May 2009.
India's second largest private sector bank by operating income HDFC Bank gained 3.92% even as its ADR fell 1.46% on Monday.
India's biggest dedicated housing finance firm by operating income HDFC rose 7.66%.
Outsourcing focussed IT stocks spurted on talks the worst may be over for the US economy. US is the biggest market for Indian IT firms. India's second largest software services exporter by sales Infosys rose 5.51% even as its American depository receipt (ADR) fell 0.35% on Monday, 11 May 2009.
India's largest software services exporter by sales TCS rose 3.57%. India's third largest software services exporter by sales Wipro gained 7.4% even as its ADR slipped 4.8% on Monday.
Meanwhile, analysts feel that US government's plan to scrap tax incentives that encourages American firms to ship jobs overseas is unlikely to dent business for Indian outsourcers. On 4 May 2009, US president Barack Obama announced plans to reduce tax breaks for US-based multinationals shipping jobs to places like India. Instead, the tax incentives would now go to those creating jobs inside the US, in places like the Buffalo city, New York.
Currently, US businesses that invest overseas can take an immediate tax deduction for expenses supporting their overseas investments. They can also defer the payment of US taxes on the profits they make from such investments. But, now the Obama Administration wants to ensure that companies do not receive deductions for expenses supporting their offshore investments until they pay tax on their offshore profits. This is intended to disincentivise US companies from retaining profits abroad.
Infosys said the proposal, if implemented, was unlikely to reverse the outsourcing of a gamut of services by US firms to Indian companies. "The current proposal, as we understand, is to close corporate tax loopholes on US multinational corporations and crack down on their overseas tax havens," the company said in a statement. "We do not believe that it has anything to do with IT outsourcing done by US corporations.", Infosys said.
Realty stocks rose on recent reports banks have stepped up lending to real estate firms. According to Reserve Bank of India (RBI) data, loans to the real estate sector grew 61% with Rs 90,765 crore outstanding during the year upto 27 February 2009 over the same period previous year. DLF, Unitech, Indiabulls Real Estate, Phoenix Mills, Omaxe, rose by between 1.13% to 6.03%.
Capital goods stocks rose after India's biggest engineering & construction firm by revenue Larsen & Toubro (L&T), last month, said it expects a strong order flow in the year ending March 2010 (FY 2010). L&T rose 1.97%. Bharat Heavy Electricals, Thermax, Punj Lloyd, Praj Industries, Siemens, rose by between 0.02% to 5.12%. L&T on 16 April 2009 said the company expects its order inflow to grow by 25-35% in FY 2010.
Some healthcare stocks rose as most of the healthcare firms reported better than expected Q4 March 2009 result. Dr Reddy's Laboratories, Pfizer, Biocon, Cipla, Sun Pharmaceutical Industries rose by between 0.2% to 6.28%.
FMCG stocks rose triggered by expectations of a surge in sales due to forecast of a good monsoon this year. ITC, United Spirits and United Breweries rose by between 1.77% to 5.01%. FMCG firms derive a substantial revenue from rural markets.
But, India's largest FMCG major by sales Hindustan Unilever fell 0.44% as it reported a lower-than-expected rise of 3.68% in net profit to Rs 394.99 crore on a 6% rise in sales to Rs 3988.33 crore in Q4 March 2009 over Q4 March 2008. Profit fell short of expectations mainly due to provision for retirements and restructuring costs. The company announced the result on Monday, 11 May 2009.
Auto stocks gained on improved sales in April 2009. Tata Motors Bajaj Auto and Mahindra & Mahindra, rose by between 1.18% to 4.13%.
India's largest car maker by sales Maruti Suzuki India rose 3.36%. The company said on Saturday, 9 May 2009, it will be launching its premium compact car Ritz on 15 May 2009 in Delhi.
Metal stocks gained as copper and aluminum rose for the first time in four days on the London Metal Exchange on stronger-than-expected economic data in China. Tata Steel, Steel Authority of India, Sterlite Industries, Hindalco Industries, National Aluminum Company, rose by between 1.37% to 5.31%.
China's copper imports rose 7% to a record in April 2009 as buyers replenished stockpiles. Aluminum shipments almost tripled, the Beijing-based customs office said today. The nation accounts for 33% of global aluminum consumption and 26% of copper demand, according to Royal Bank of Scotland Group Plc.
Cals Refineries clocked the highest volume of 3.67 crore shares on BSE. Unitech (3.01 crore shares), Suzlon Energy (2.16 crore shares), Housing Development & Infrastructure (1.11 crore shares) and Ispat Industries (1.04 crore shares) were the other volume toppers in that order.
Reliance Industries clocked the highest turnover of Rs 253.59 crore on BSE. ICICI Bank (Rs 222.20 crore), Reliance Capital (Rs 192.47 crore), Housing Development & Infrastructure (Rs 191.35 crore) and Suzlon Energy (Rs 166.69 crore were the other turnover toppers in that order.
Yes Bank
We recommend a sell on Yes Bank from a short-term trading perspective. It is apparent from the chart of Yes Bank that after bottoming in early March around Rs 41, it began to trend upward. The stock’s uptrend accelerated in early April and it witnessed a sharp up move. However, at Rs 86, the stock encountered resistance in early May and reversed direction triggered by the negative divergence displayed in the daily relative strength index (RSI). Moreover, we notice that the stock has formed a rising wedge, a bearish pattern, spanning over the past three weeks. On May 11, the stock tumbled almost 5 per cent breaking down from the rising wedge pattern. The daily RSI has entered the neutral region from the bullish zone. The daily moving average convergence and divergence indicator is signalling a sell. We are bearish on the stock from a short-term perspective. We anticipate the stock to decline further until it hits our price target of Rs 69 in the forthcoming sessions. Traders with short-term trading perspective can sell the stock while maintaining a stop-loss at Rs 81.
via BL
Pre Session Commentary - May 12 2009
Today domestic markets are likely to open negative as the Asian markets are also trading in red. The sentiments are already weak in domestic arena and therefore further deterioration in inevitable if other markets also show bearish trend. The IIP data for the month of March to be announced today is expected to record contraction. The trading would exude a lot of cautiousness amongst traders and most likely the markets would trade in the southward.
On Monday, due to negative cues from the other markets domestic markets closed in deep red. After a phenomenal positive gap opening the domestic markets plunged into deep red in an hour of trading. The markets have started showing some cautiousness ahead of the Lok Sabha election results. There was lack of any supportive news for the market and therefore traders turned bearish till the end. Amongst the sectors Realty, CD, CG and Power were the top losers as they lost 5.19%, 2.59%, 2.48% and 1.88% respectively. Mid and Small cap indices were equally bashed as they lost by 1.56% and 2.15% respectively. We expect the markets to be trading negative.
The BSE Sensex closed low by 193.44 points at 11,682.99 and NSE Nifty ended with a loss of 66.10 points at 3,554.60. BSE Mid Caps and Small Caps closed with losses of 59 points and 91.94 points at 3,711.42 and 4,185.32 respectively. The BSE Sensex touched intraday high of 12,026.60 and intraday low of 11,621.30.
On Monday, the US stock markets closed in red. Due to lack of any economic news and also the profit booking pressures the markets were under the selling pressure for the entire session. The financial sector which had earned 23% gain in the last week shed 6.8% due to huge profit booking pressures. Wells Fargo has announced that it will raise $8.6 billion as regulators had asked the back to raise nearly $13.4 billion after the bank’s stress test. US light crude oil futures for June closed fractionally lower at $58.53 per barrel on the New York Mercantile Exchange.
The Dow Jones Industrial Average (DJIA) fell by 155.88 points to close at 8,418.77 The NASDAQ Composite (RIXF) index declined by 7.76 points to close at 1,731.24 and the S&P 500 (SPX) fell by 19.99 points to close at 909.24.
Today major stock markets in Asia are trading mixed. Hang Seng is trading low by 3.15 points at 17,214.74 followed by Japan''s Nikkei which is up by 16.198 points at 9,401.89, Strait Times is up by 27.62 points at 2229.48. Seoul Composite is also flat at 1,400.47 respectively.
Indian ADRs ended in negative. In technology sector, Satyam closed lower by 5.13% along with Wipro by 4.80% and Infosys by 0.35%. In banking sector, HDFC bank and ICICI Bank fell 1.46% and 3.52% respectively. In telecommunication sector Tata Communication and MTNL dropped by 4% and 1.03% respectively.
The FIIs on Monday stood as net buyers in equity and net sellers in debt. Gross equity purchased stood at Rs 3,164.60 Crore and gross debt purchased stood at Rs 405.40 Crore, while the gross equity sold stood at Rs 1,924.00 Crore and gross debt sold stood at Rs. 816.60 Crore. Therefore, the net investment of equity and debt reported were Rs 1,240.60 Crore and Rs (411.20) Crore respectively.
On Monday, the partially convertible rupee ended at 49.52/54 per dollar, 24 paise weaker than previous close at 49.28/29. Rupee lost ground due to fall in domestic stock markets creating apprehensions of foreign money inflow.
On BSE, total number of shares traded were 41.51 Crore and total turnover stood at Rs 4,380.10 Crore. On NSE, total number of shares traded was 90.05 Crore and total turnover was Rs 13,634.28 Crore.
On NSE Future and Options, total number of contracts traded in index futures was 771072 with a total turnover of Rs 13,236.72 Crore. Along with this total number of contracts traded in stock futures were 387563 with a total turnover of Rs 16,118.81 Crore. Total numbers of contracts for index options were 818472 with a total turnover of Rs 15,101.52 Crore and total numbers of contracts for stock options were 30811 and notional turnover was Rs 1,353.42 Crore.
Today, Nifty would have a support at 3,487 and resistance at 3,525 and BSE Sensex has support at 11,385 and resistance at 11610.
Crude sinks a bit
Prices pare most of their losses but still end lower
Crude oil ended lower for the first time in four sessions on Monday, 11 May, 2009. Prices fell today due to the rising dollar and also by the rising inventories of crude reported by energy department last week.
On Monday, crude-oil futures for light sweet crude for June delivery closed at $58.50/barrel (lower by $0.13 or 0.2%) on the New York Mercantile Exchange. Earlier, it fell by more than 3% to $56.78. Last week, crude ended higher by 10.2%.
Crude ended April higher by 2.9%. Previously, March trading ended 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 61% since then. Year to date, in 2009, crude prices are higher by 23.6%. On a yearly basis, crude prices are lower by 40%.
In the currency market on Monday, the greenback regained some strength on Monday, and the dollar index, which weighs the strength of dollar against the basket of six other currencies was up 0.1% at $82.692.
Last week, EIA had reported that crude inventories increased by 600,000 barrels in the week ended 1 May, 2009. Gasoline inventories fell by 200,000 barrels. Market was expecting a buildup of more than 2 million barrels in crude inventories and a 750,000 increase in gasoline inventories. Crude inventories, meanwhile, still remained at the highest level since September 1990.
The report also showed that total petroleum demand over the past four weeks was 7.9% lower than a year ago. EIA also reported U.S. refineries increased their capacity utilization of 85.3%, up from 82.7% a week ago.
Also at the Nymex on Monday, June-reformulated gasoline fell 2.53 cents, or 1.5%, to $1.6802 a gallon, and June heating oil sank 1.75 cent, or 1.2%, to $1.5009 a gallon.
Natural gas for June delivery fell 2.2 cents, or 0.5%, to $4.289 per million British thermal units. The contract for natural gas rallied 21.6% last week.
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 2,875/barrel, higher by Rs 18 (0.63%) against previous day's close. Natural gas for May delivery closed at Rs 212.9/mmbtu, higher by Rs 3.1/mmbtu (1.5%).
Market may extend losses on weak global cues
Key benchmark indices may extend last two days' losses on weak global cues. Political uncertainty may cause volatility on the bourses in the next few days. Investors will closely watch the industrial output data to be announced by the government at 12:00 IST today.
Industrial output fell an annual 1.2% in February 2009, according to provisional figures. Output rose 0.4% in January 2009 and fell 0.6% in December 2008.
Political worries may cause volatility on the bourses in the next few days with polling underway for India's 15th Lok Sabha. The month-long a parliamentary elections that began on 16 April 2009 will conclude on 13 May 2009. Poll estimates point to a fractured mandate. Consumption and investment decisions will be significantly impacted by any signs that the new government is unstable. The counting of votes will take place on 16 May 2009. A party/alliance needs 272 seats in the 543-member parliament to claim power at the Centre.
Asian stocks slid today from a seven-month high, led by banks and mining companies, as investors sold shares trading at their most expensive valuations in five years. Key benchmark indices in Japan, South Korea, Singapore and Taiwan fell by between 0.01% to 2.47% . But key benchmark indices in China and Hong Kong rose by between 0.01% to 0.09%.
In US, The Dow and the S&P 500 fell on Monday 11 May 2009 due to profit taking after a two-month run-up, while news of several share offerings weighed on banks as investors worried about their dilutive impact on current shareholders. The Dow Jones industrial average dropped 110.71 points, or 1.29% to 8,463.94. The Standard & Poor's 500 Index fell 13.33 points, or 1.43% to 915.90. But the Nasdaq Composite Index rose 5.35 points or 0.31 %, to 1,744.28.
Back home, profit taking emerged after a solid rally on the domestic bourses recently. The rally was a part of a sharp surge in global equities triggered by hopes the worst of the global economic recession may be over. From a recent high of 12,134.75 on 4 May 2009, the Sensex has lost 451.76 points or 3.72% to 11,682.99 on Monday 11 May 2009. Yet, the Sensex is up 2,035.68 points or 21.1% in calendar year 2009.
As per the provisional figures on NSE, the foreign funds bought shares worth Rs 79.88 crore on Monday, 11 May 2009 even as domestic funds sold shares worth Rs 89.39 crore on Friday 8 May 2009.
Building on benefits
Today, apart from the realtors who are under pressure to woo customers, there are buyers who are forcing developers to offer sops. About 800 people, who had booked flats in DLF's Garden City project in Chennai last year, formed an activist forum on Google Groups in February this year. The objective: to collectively negotiate with the builder on issues such as refund of deposits and scrutiny of the original title deed. Finally, DLF refunded the deposits of 200 buyers who had decided to exit the project. It also offered a discount to those who stayed on. Similarly, in Gurgaon, another set of 500 buyers on Yahoo! Groups managed discounts from the same builder.
The combined impact of consumer activism and sectoral pressures is that a prospective buyer has an upper hand while negotiating for a property. "Overall, real estate prices have corrected by 25-40% over the past six months. With funds drying up from investors, speculators, private equity players and banks, realtors have realised that money is only available with the end-users who, in turn, are looking at value for their money," explains Anuj Puri, MD, Jones Lang LaSalle Meghraj.
The best deals are available in the case of new or semi-constructed projects. DLF, for instance, has cut prices by 30% for its upcoming project in Chennai. In central Delhi, the same builder has launched a scheme to sell each of the 1,400 flats (1,200 sq ft each) at Rs 54 lakh, half the price of similar properties in the same location.
Does this imply that prices might fall further in the near future? Most customers believe so, but the builders don't agree. "So far, the lack of demand has forced real estate companies to announce price cuts. I don't think there is any further scope for this," feels Rohtas Goel, CMD, Omaxe. Adds Puri: "In Gurgaon, property rates have dropped from Rs 6,500-7,000 per sq ft to Rs 3,250. The prices have now hit the 2005-year range and there is no possibilty for more reduction."
At the moment, however, the deal fever is reaching a peak. This is especially for those who have already booked flats in new schemes or are ready to take possession. Some firms are now giving indirect discounts of nearly 20%; one of them has announced a 5% cut on base price, an additional 10% rebate for timely payments, and a doubling of the compensation rate (from Rs 5 to Rs 10 per sq ft per month) if the project is delayed because of problems associated with the builder. "We have implemented price corrections on project basis. Different models were worked out in different cities," says Rajiv Talwar, executive director, DLF.
Similarly, the buyers who pay timely instalments to Omaxe are being offered 5-10% discount on future payments. Mont Vert is allowing existing tenants to buy the flat once the lease expires. The rent that has been paid over the past 11 months is considered to be the down payment and is deducted from the sale price. Unitech, Ansal Properties and Parsvnath, among others, require customers to pay only the initial booking amount during the development stages and the EMIs from the date of possession. In the interim period, the developers pay the EMIs.
Freebies have become the norm, rather than an exception. A smaller house free with a bigger one. A fully furnished house for the price of a bare one. A free car (Mercedes or BMW) along with the purchase of a villa. Free international holidays. The list goes on. What you get depends largely on your negotiation skills and level of patience. The desperation among realtors is so extreme that they would rather strike a deal now, at whatever price, than wait till day after tomorrow.
However, the caveat 'buyers' beware' still applies. This is because there are many realtors who insist on fooling the prospective purchaser. The 'zero EMI till possession' offer only implies that you will not pay the interest for that period. Once your EMIs start, they will be calculated on the original amount that you borrowed and you will have to repay the entire principal amount. Thus, what you save is only the interest for a few months, which may end up being lower than a straight discount of 10-20% from the builder.
Check out the free house that is being given along with a larger one. In some cases, the latter may be priced higher than the market rate. So, the freebie offered might come to a naught. In other cases, the free one-room-kitchen flat with a 2-BHK, or a 1-BHK with a 2.5/3-BHK flat offer may be misleading. While your main house may be located within the city, the free flat may be far away in the suburbs or in another city. When it comes to cars, the models that are being doled out have, or are going to be, phased out. So, you could end up being saddled with a white elephant that you can't use or re-sell.
It is important, therefore, to scrutinise the offers carefully before you home in on them.
via Money Today
Daily News Roundup - May 12 2009
Reliance Power Transmission (RPTL), Essar Power, L&T and JSW Energy are among the eight companies that have been selected to place price bids for three large power transmission projects worth Rs56.5bn. (ET)
The Delhi Development Authority announced a Rs7bn bailout package for cash-drained Emaar MGF, which is developing the Commonwealth Games Village (CGV) project. (BS)
JSW Steel plans to sell its plants in the US at a price lower than its acquisition cost to cut rising losses. (ET)
Tata Teleservices, Vodafone and Idea Cellular are expected to issue multi-year BPO contracts of ~Rs5bn in the next couple of months. (ET)
United Breweries to bottle and distribute Heineken brands in India; will get a one-time fee of Rs3bn. (ET)
ONGC to invest Rs60bn in new and existing fields in current fiscal to raise output. (ET)
Maruti to expand presence in diesel segment. (BL)
ONGC may see its natural gas output almost double to 100mn cubic meter a day by 2015-16. (FE)
Maruti plans to focus on the rural market, to double its outlets in rural India from the present 231 to around 450 in the next two years. (BL)
GMR Infrastructure to raise up to Rs50bn through private placement of shares in domestic and international markets. (ET)
Maytas Infra is expected to achieve financial closure for the Hyderabad metro rail project in about three months. (BS)
Tatas-Srei JV may share passive infrastructure with two new operators Swan Telecom and S-Tel and targets to build over 30,000 towers by end of current fiscal. (ET)
RCom and Tata Teleservices have opposed a proposal to auction extra airwaves. (ET)
Bhel shelves plans of offshore oil rigs. (FE)
IOC likely to cut stake in Farsi gas and oil field in Iran as it faces financing pressure due to continuing losses on fuel sales. (FE)
GMR Energy, a subsidiary of GMR Infrastructure Ltd, is planning to set up a 2,000MW thermal power plant near a port on the west coast as it has already tied up coal supplies by acquiring a mine for US$100mn in Indonesia last year. (BS)
TCS likely to take a call on promotions at the end of Q1 FY10. (ET)
GMR Infrastructure will be issuing preferential equity shares to India Development Fund, the private equity arm of IDFC Infrastructure Fund. (BL)
Lupin has settled all patent litigation with US drug maker Wyeth for Effexor XR capsules; the US firm’s branded anti-depressant. (BS)
Bajaj Auto to ramp up production at Pantnagar. (BS)
Sri Lanka has assured to expedite the implementation of a NTPC’s 500mw imported coal-based power project at Trincomalee in Sri Lanka. (FE)
With a 24% increase in its wage bill, Coal India is looking for a price hike to protect its bottomline. (FE)
HMSI, the two-wheeler arm of the Japanese parent, has drafted an aggressive strategy for motorcycles that will also act as a key differentiator with its sibling, Hero Honda. (BL)
The Central Electricity Regulatory Commission has penalised Tamil Nadu Electricity Board, Karnataka Power Transmission Corporation and Rajasthan Rajya Vidyut Prasaran Nigam for grid indiscipline. (FE)
Bajaj Auto has launched new Pulsar model Pulsar 150 DTS-i and 180 DTS-i. (FE)
India’s apex consumer disputes panel rejects Satyam shareholder’s compensation plea of about Rs50bn. (ET)
Reliance Life Insurance reduced the number of agents by almost a third in H2 FY09. (BS)
Gujarat NRE Minerals Ltd (GNM), the Australian subsidiary of Gujarat NRE Coke Ltd, has secured a US$50mn long-term loan facility from a consortium led by Axis Bank. (BL)
Production at tyre giant MRF’s factories at Arakkonam and Puducherry, has been hit following a sit-in strike by around 3,000 workers. (BS)
Damodar Valley Corporation plans to raise Rs20bn from the debt market in order to fund the first phase of the proposed 500mw Bokaro project. (ET)
Loop Telecom, a subsidiary of Ruias-managed Loop Mobile (earlier BPL Mobile) announced the soft launch of cellular services in Tamil Nadu and Orissa circles. (ET)
LG Electronics India and Samsung India are in the process of creating new category of LCD TVs, called the light emitting diode (LED) TVs. (FE)
Rasna Pvt Ltd holding ~93% market share in the soft drink concentrate market in India, plans to enter the ready-to-drink segment. (FE)
Central Electricity Regulatory Commission is likely to notify the amended open access regulations this week, paving the way for the top power exchanges – IEX and PXIL – to launch long-term contracts. (ET)
The Government has deferred a decision on a proposal to impose provisional safeguard duty on hot rolled coils/sheets/strips as the matter needed to be examined further after taking views of the consuming industry. (BL)
Sebi has made it mandatory for companies seeking listing of corporate bonds and other debt instruments to maintain adequate security cover for them at all times. (BS)
The National Highways Authority of India (NHAI) has decided to cancel and re-invite bids for six projects, for which it had received single bids. (BL)
India could soon receive up to 2,500 tons of uranium from Kazakhstan as an agreement in this regard is set to be signed between the two sides by the month-end. (ET)
IRDA has rejected its pension counterpart’s proposal to involve insurers in the distribution of the New Pension System. (ET)
Pension fund regulator PFRDA will get to supervise pension plans offered by private insurers and mutual funds. (ET)
Animal farm…no bulls here!
There may come a time when the lion and the lamb will lie down together, but I am still betting on the lion.
The lions are unlikely to be separated from the lambs before Saturday. For now, most political parties appear like horses willing to be traded for the best price. The swines and its related flu can take a break from India. Don’t take big bets this week. Wait on the sidelines till there is clarity on the political outcome.
The recent bull dominance appears to be under temporary threat as players don’t want to take any chances ahead of the election results. Perhaps they are smarting from the May 2004 experience when the market had corrected after a surprise defeat for the NDA.
Traded volume was low on Monday and may remain so this week. Overall, the market will be choppy and rangebound.
Besides uncertainty over Government formation, one must also ponder over another big question i.e. how long will the new regime last? What’s worse, the long election process has left a sluggish economy without leadership at a critical juncture.
IIP for April and the FY09 will be out today and is not expected to show any big improvement.
Talking of the economy, the turnaround may take longer than anticipated. Economic activity may remain sluggish for a while before rebounding decisively. Even after the bounce back, the unwinding of the large stimulus will have its own set of issues like inflation, ballooning deficits, etc around the globe. Back home, we will have to contend with yawning deficits, precarious public finances and of course budget. Conjecture over monsoon may also have a bearing.
Asian Paints, Hinduja Ventures, JB Chemicals and Kotak Mahindra Bank will announce their results today.
FIIs were net buyers in the cash segment on Monday at Rs798.8mn while the local institutions pulled out Rs173.1mn. In the F&O segment, the foreign funds were net buyers at Rs1.03bn. On Friday, the foreign funds were net buyers at Rs12.41bn in the cash segment. Mutual Funds were net sellers at Rs714mn in the cash segment on the same day.
US stocks declined on Monday after hitting four-month highs last week, as major banks said they would sell shares to repay government funds and General Motors (GM) moved closer to bankruptcy.
The Dow Jones Industrial Average fell 155.88 points, or 1.82%, to 8418.77, the biggest drop for the blue-chip index since April 20. The broad Standard & Poor's 500 fell 19.99, or 2.15%, to 909.24. The technology-oriented Nasdaq Composite fell 7.76, or 0.45%, to 1731.24.
US stocks have been rallying since hitting multi-year lows in early March. The Dow and S&P 500 have risen for eight of the past nine weeks; the Nasdaq has risen for 9 in a row. In that time the Dow gained 31% and the S&P 500 and Nasdaq gained 37%.
Bank shares slipped, with the KBW Bank sector index losing 7.1%. Last week, the government revealed that 10 of the 19 banks that had been part of the stress tests would need to raise a collective $75 billion to be strong enough to withstand a potentially deeper recession.
Wells Fargo and Morgan Stanley, two of the 10 banks needing capital, sold billions in stock just one day after the stress test announcements. Bank of America also registered Friday to sell 1.25 billion shares, which the company said will yield around $11 billion.
On Monday, US Bancorp, Capital One Financial, BB&T and KeyCorp all announced plans to issue stock, with the intention of paying back the money their received under the government's bank bailout plan. KeyCorp was one of the 10 banks that was told to raise more capital as a result of the stress tests. The other three were not.
ADRs of global bank HSBC fell 2.5%. The bank said its US consumer-finance operation saw a slight slowdown in the deterioration of its mortgage loans in the first quarter, but warned improvements in the US mortgage market may be a seasonal blip.
Troubled insurer AIG is selling its Japanese headquarters to Nippon Life Insurance for $1.2 billion, in its latest undertaking to pay back a massive government loan. AIG shares fell 5.5%.
Morgan Stanley shares fell 7.6% after Japanese bank Mitsubishi UFJ Financial Group increased its stake to over 20% by buying 25 million shares at $24 each.
GM shares dropped 11% after CEO Fritz Henderson repeated earlier comments that a bankruptcy filing is "probable." Analysts said a bankruptcy filing is all but inevitable as the auto giant faces tough propositions such as persuading bondholders to swap $27 billion in debt for 10% of its risky stock.
Ford Motor shares were also down. After the close, the carmaker said it planned a 300-million-share follow-on sale of common stock as it seeks to rebuild funds for health-care benefits.
US President Barack Obama said that he has secured the commitment of a number of industry groups to cut health care costs by $2 trillion over the next decade. And the administration's top antitrust official said Obama will take a more aggressive approach to cracking down on monopolies than did his predecessor.
Treasury prices rallied, lowering the yield on the benchmark 10-year note to 3.17% from 3.28% on Friday.
Lending rates continued to fall. The three-month Libor rate fell to an all-time low of 0.92% from 0.94% on Friday. The overnight Libor rate held steady at 0.23%. Libor is a bank lending rate.
In currency trading, the dollar rose versus the euro and fell against the yen.
US light crude oil for June delivery fell 13 cents to settle at $58.50 a barrel on the New York Mercantile Exchange.
COMEX gold for June delivery fell $1.40 to settle at $913.50 an ounce.
European shares also lost ground. The pan-European Dow Jones Stoxx 600 index declined 1.4% to 206.59, having gained ground in six of the prior eight trading sessions. The index rose almost 5% last week, marking the eighth time it has posted weekly gains in the last nine weeks.
On a regional level, the French CAC-40 index fell 1.9% to 3,248.67, Germany's DAX 30 index lost 1% to 4,866.91 and the UK's FTSE 100 index slipped 0.6% to 4,435.50.
Markets started off the week on a negative note with the NSE Nifty breaking below the key support levels. 3,610-3,600 were the strong support for Nifty.
Firm cues from the US and Asian markets lifted the key indices to open in the green. However, markets were unable to hold on to their gains as all round selling pressure dragged the benchmark indices to extend losses to second straight trading session.
The BSE Sensex slipped 193 points to close at 11,682 and the NSE Nifty fell 66 points to close at 3,554.
Among the 30-components of Sensex, 24 ended in the negative terrain and 6 ended in the green. Top losers were DLF, SBI, JP Associates, RCom, Tata Steel and Tata Motors.
Bucking the negative trend were, M&M, ICICI Bank, Sun Pharma and Maruti.
Shares of Orchid Chemical have declined by over 7% to Rs101. The company announced that it received USFDA nod for Sumatriptan tablets. The scrip touched an intra-day high of Rs112 and a low of Rs99 and recorded volumes of over 0.7mn shares on BSE.
Shares of JSW Steel surged by 3.3% to Rs423 after the company announced that its April crude steel production grew 60%. The scrip touched an intra-day high of Rs432 and a low of Rs398 and recorded volumes of over 2.6mn shares on BSE.
Shared of Tata Steel slipped by 4% to Rs271 after reports stated that the Corus unit in UK is on verge of closure. The scrip touched an intra-day high of Rs289 and a low of Rs268 and recorded volumes of over 5.9mn shares on BSE.
Shares of Aurobindo Pharma gained by 6% to Rs297 after the company announced that it received approval from TGA Australia for Simvastatin tablets. The scrip touched an intra-day high of Rs303 and a low of Rs277 and recorded volumes of over 0.2mn shares on BSE.
Shares of Gujarat NRE advanced by 3.7% to Rs31 after the company’s unit signed US$50mn long term loan facility. The scrip touched an intra-day high of Rs32 and a low of Rs29.6 and recorded volumes of over 11.7mn shares on BSE.
Indian market may continue its downward trend. Key support for the Nifty is around 3,450 levels. Also uncertainty over the outcome of elections would continue to keep the traders and investors on tenterhooks.
US markets end lower
US stocks fell on Monday as investors locked in gains from a hefty multi-week rally and braced for new economic data.
The Dow Jones Industrial average declined 155.88 points, or 1.82%, to settle at 8,418.7.
The Standard & Poor`s 500 index dropped 19.99 points, or 2.15%, to end at 909.24.
The NASDAQ Composite index decreased 7.76 points, or 0.45%, to close at 1,731.24.
Majority of Indian ADRs ended on a negative note barring Patni Computer Systems.
Bullion metals turn little pale
Precious metals drop due to strong dollar
Precious metals ended lower on Monday, 11 May, 2009 at Comex. Prices fell today after registering gains last week. Prices fell today due to the relatively strong dollar.
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 lost $1.4 (0.2%) to close at $913.5 an ounce on the New York Mercantile Exchange. Last week, gold ended higher by 3%. Year to date, gold prices are higher by 3.4%.
For the month of April, gold lost 3.7%, the second consecutive monthly drop. 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 (15%) since then.
On Monday, Comex silver futures for July delivery lost 4.5 cents (0.3%) at $13.91 an ounce. Year to date, silver has climbed 17.4% this year. For 2008, silver had lost 24%.
In the currency market on Monday, the greenback regained some strength on Monday, and the dollar index, which weighs the strength of dollar against the basket of six other currencies was up 0.1% at $82.692.
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 64 (0.44%) at Rs 14,570 per 10 grams. Prices rose to a high of Rs 14,613 per 10 grams and fell to a low of Rs 14,482 per 10 grams during the day's trading.
At the MCX, silver prices for May delivery closed Rs 80 (0.35%) higher at Rs 22,624/Kg. Prices opened at Rs 22,510/kg and rose to a high of Rs 22,740/Kg during the day's trading.
Offtopic - Fake IPL Names List
FIP- "*"
Calypso King - Chris Gayle
Castro - Fidel Edwards
Appam Chutiya- Sreeshanth
Lordie - Sourav Ganguly
Lord Almighty - Sourav Ganguly
Aila = Sachin Tendulkar
Little Monster - Sachin Tendulkar
Badasha Dildo - Shah Rukh Khan
Vinnie Dildo - Shah Rukh Khan
Little John - Ishanth Sharma
Style bhai - Murali Kartik
Mangal Pandey- L R Shukla
Prince Charles of Patiala - Yuvraj Singh
Bubblee Bantli - Preity Zinta
Bunty= Ness Wadia
Big Sister - Shilpa Shetty
Little Sister - Shamita Shetty
Deegrah Pathan - Irfan Pathan
Bhooka Naan - John Buchanan
Skipper - Brendon Mccullam
Phoren Babas - Brendon McCullum, John Buchanan
Gilli Danda - Ashok Dinda
Bangla Tiger - Mortaza
Junta Tormentor - Ajanta Mendis
Meera Bhai - Harbajan Singh
Ganji Hanger - Sanjay Bangar
Mr. Batlivala - Vijay Mallaya
Bevdaa - Jessie Ryder
Re-Peter - Kevin Peterson
Peter Ka Beta – Kevin Pietersen
RVR Singh - VRV Singh
Sandy Baddy Babe - Mandira Bedi
Dhakkan coach-Darren Lehmann
Lady Jaya = Mahela Jayawardene
Arnold Power = Ramesh Powar
Springbok = Charl Langeveldt
Ghati Baba = Rohit Sharma
Kishen Kanhaiya= Ravi Shastri
Sheikh of Tweak - Shane Warne
Sultan of Tweak - Shane Warne
Pedophile Priest - Adam Gilchrist
RDB - Ranadeb Bose
Shakespeare - Aakash Chopra
Sparrow / Parrott - Glenn McGrath
Very Very Special Friend Ram - VVS Laxman
Kaan Moolo - Ajit Agarkar
Former India fast bowler who will remain a former India fast bowler - Ajit Agarkar
Buddhiman Baba= Wriddhiman Saha
Sticky Something= Ricky Ponting
Dewar=Rahul Dravid
Big Mac= Mathew Hayden
Chhota Chetan= Cheteshwar Pujara
Panty Curry= Robin Uthapa
Chinnu Popli= Bharat Chipli/Sreevats Goswami
Chikna Pussy= David Hussey
Chirkut Teli= Viraat Kohli
Bubban= Arindam Ghosh
Darwaan of Patiala= Tom Moody
Vakil Saab= Kumar Sangakkara
Saala Slimeball = Lalit Modi
Cool Dude= Mahendra Singh Dhoni
Boy George= Joy Bhattacharya(KKR Team Director)
Bubblies= Kings IX Punjab
Dhakkans= Daccan Chargers
Rajpoots= Rajasthan Royals
Bevdaas Team - Bangalore Royal Challengers
Chatterjee Kaku= ?
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