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Monday, June 08, 2009
NSE Bulk Deals to Watch - June 8 2009
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
08-JUN-2009,ABAN,Aban Offshore Ltd.,C D INTEGRATED SERVICES LTD.,BUY,527986,1215.10,-
08-JUN-2009,ADLABSFILM,Adlabs Films Limited,A TO Z STOCK TRADE PRIVATE LIMITED,BUY,298063,421.92,-
08-JUN-2009,ALOKTEXT,Alok Industries Limited,JAYPEE CAPITAL SERVICES LTD.,BUY,2689593,25.95,-
08-JUN-2009,DISHTV,Dish TV India Limited,DEUTSCHE SECURITIES MAURITIUS LTD,BUY,3974240,48.96,-
08-JUN-2009,DISHTV,Dish TV India Limited,SHAIL INVESTMENTS PVT. LTD.,BUY,2800000,49.18,-
08-JUN-2009,DISHTV,Dish TV India Limited,TRANSGLOBAL SECURITIES LTD.,BUY,3213876,47.54,-
08-JUN-2009,EMCO,Emco Limited,SUWALAL CHHAGANMAL BAFNA,BUY,304138,88.87,-
08-JUN-2009,FIRSTWIN,First Winner Industries L,BINDU B SHAH,BUY,89000,30.00,-
08-JUN-2009,GLORY,Glory Polyfilms Limited,BP FINTRADE PRIVATE LIMITED,BUY,167748,30.31,-
08-JUN-2009,GLORY,Glory Polyfilms Limited,GAURAV INVESTMENTS & CONSULTANCY (PVT) LTD.,BUY,46128,31.26,-
08-JUN-2009,GLORY,Glory Polyfilms Limited,JYOTI PORTFOLIO LIMITED,BUY,92197,30.38,-
08-JUN-2009,GOKUL,Gokul Refoils and Solvent,ELEGANT CAPITALS PRIVATE LIMITED,BUY,345772,268.25,-
08-JUN-2009,GOLDTECH,Goldstone Tech Ltd.,KUMAR G BAILKERI,BUY,100000,48.20,-
08-JUN-2009,GWALCHEM,Gwalior Chemical Industri,BP FINTRADE PRIVATE LIMITED,BUY,133135,106.58,-
08-JUN-2009,ISPATIND,Ispat Industries Limited,JAYPEE CAPITAL SERVICES LTD.,BUY,10619472,25.48,-
08-JUN-2009,NITCO,Nitco Limited,ALBULA INVESTMENT FUND LTD DEUTSCHE BANK,BUY,173791,73.11,-
08-JUN-2009,OCTAV,Octav Investments Limited,BP FINTRADE PRIVATE LIMITED,BUY,5025,31.20,-
08-JUN-2009,WWIL,Wire and Wireless (India),ADROIT FINANCIAL SERVICES PRIVATE LIMITED,BUY,1157393,25.22,-
08-JUN-2009,ABAN,Aban Offshore Ltd.,C D INTEGRATED SERVICES LTD.,SELL,527986,1215.68,-
08-JUN-2009,ABAN,Aban Offshore Ltd.,CITIGROUP GLOBAL MKTS MAURITIUS PVT LTD- SELL CODE,SELL,200000,1235.39,-
08-JUN-2009,ADLABSFILM,Adlabs Films Limited,A TO Z STOCK TRADE PRIVATE LIMITED,SELL,298063,422.08,-
08-JUN-2009,ALOKTEXT,Alok Industries Limited,JAYPEE CAPITAL SERVICES LTD.,SELL,2689593,25.86,-
08-JUN-2009,DISHTV,Dish TV India Limited,DELGRADA LIMITED,SELL,9730293,49.33,-
08-JUN-2009,DISHTV,Dish TV India Limited,LAZARUS INVESTMENTS LTD,SELL,6612500,49.07,-
08-JUN-2009,DISHTV,Dish TV India Limited,PAN INDIA PARYATAN LIMITED,SELL,3680000,49.04,-
08-JUN-2009,DISHTV,Dish TV India Limited,SHAIL INVESTMENTS PVT. LTD.,SELL,2800000,49.16,-
08-JUN-2009,DISHTV,Dish TV India Limited,TRANSGLOBAL SECURITIES LTD.,SELL,3672003,47.92,-
08-JUN-2009,GLORY,Glory Polyfilms Limited,BP FINTRADE PRIVATE LIMITED,SELL,152742,30.11,-
08-JUN-2009,GLORY,Glory Polyfilms Limited,GAURAV INVESTMENTS & CONSULTANCY (PVT) LTD.,SELL,229128,32.05,-
08-JUN-2009,GLORY,Glory Polyfilms Limited,JYOTI PORTFOLIO LIMITED,SELL,57197,31.97,-
08-JUN-2009,GOKUL,Gokul Refoils and Solvent,J KUMAR SOFTWARE SYSTEM (I) PRIVATE LIMITED,SELL,345772,268.25,-
08-JUN-2009,GWALCHEM,Gwalior Chemical Industri,BP FINTRADE PRIVATE LIMITED,SELL,162353,106.60,-
08-JUN-2009,ISPATIND,Ispat Industries Limited,JAYPEE CAPITAL SERVICES LTD.,SELL,10443309,25.50,-
08-JUN-2009,OCTAV,Octav Investments Limited,BP FINTRADE PRIVATE LIMITED,SELL,17522,31.19,-
08-JUN-2009,SELMCL,SEL Manufacturing Company,MAVI INVESTMENT FUND,SELL,100000,87.42,-
08-JUN-2009,WWIL,Wire and Wireless (India),ADROIT FINANCIAL SERVICES PRIVATE LIMITED,SELL,1132893,24.98,-
Post Session Commentary - June 8 2009
The domestic stock market tumbled during the trading session to close on a weak note backed by heavy profit booking across the selective indices like Realty, Metal, bankex and Consumer Durables index. Moreover, the lower index futures along with weak opening of the European markets also added to the negative sentiments of the investors that dragged down the market further. Though there was a gap up opening tracking the positive Asian markets but it soon turned volatile as profit booking takes a lead and kept on marching southward throughout the trading session.
The domestic key benchmark indices- BSE Sensex and NSE Nifty fell below the psychological 15,000 mark and 4,500 respectively. After a gap up opening, the market changed its gears and remained in the sellers’ radar for most of the session without any sign of recovery till the final bell. Moreover in the global arena, the US Markets closed mixed on Friday. The markets started with a subdued trading sentiment as the non-farm better than expected job data of the previous day faded. Traders however started picking up stocks higher after the news about the payrolls data that fell by 345,000 during May. The job losses numbers were below the 520,000 that were expected and far below than the 504,000 that were recorded during the month of April. On the other hand on a macro economic scenario the unemployment data has reached 26 years high of 9.4% up from 8.9%. From sectoral front, the investors off-loaded position across almost all the sectors led by Realty, Metal, Bankex and CD index while the IT index witnessed some buying support to close with gains of more than 1.5%.
Among the Sensex pack 26 stocks ended in negative territory while 4 in positive. The market breadth indicating the overall health of the market remained weak as 2,246 stocks closed in red while 582 stocks closed in green while 34 stocks remained unchanged in BSE.
The BSE Sensex closed lower by 437.63 points or 2.90% at 14,665.92 and NSE Nifty closed down by 157 points or 3.42% at 4,429.90. The BSE Mid Caps and Small Caps closed with losses of 294.93 and 374.77 points at 5,114.85 and 6,083.88. The BSE Sensex touched intraday high of 15,200.82 and intraday low of 14,604.23.
Losers from the BSE Sensex pack are JP Associates (10.40%) along with DLF (10.34%), Tata Steel (10.21%), Reliance Comm (8.68%), Reliance Infra (8.55%), SBIN (6.76%), Ranbaxy Labs (6.45%), Tata Motors (6.25%) and Hindalco Inds (6.14%).
Gainers from the BSE Sensex pack are Wipro Ltd (3.36%) followed by Infosys (2.52%), TCS (2.29%) and HUL (0.14%).
On the global markets front the Asian markets which opened before the Indian market, closed in red. Taiwan Weighted, Strait Times, Hang Seng, Jakarta Composite closed lower by 3.34%, 2.61%, 2.28% and 1.07% at 6,628.02, 2,333.70, 18,253.39 and 2,056.64.
European markets which opened after the Indian market are trading in negative. In Frankfurt the DAX index is trading lower by 1.54% at 4,998.68 and in London FTSE 100 is trading down by 1.14% at 4,387.98.
The BSE Realty index decreased (10.54%) or 424.82 points to close at 3,604.92. Main losers are Unitech (13.80%), Mahindra Life (13.61%), HDIL (11.67%), DLF (10.34%) and Indiabull Real (10.06%).
The BSE Metal index dropped (6.51%) or 761.92 points at 10,933.58. Scrips that mostly lost are JSW Steel (13.02%), Ispat Industries (11.71%), Welspun Gujurat Stahl (10.61%), Tata Steel (10.21%) and SAIL (9.07%).
The BSE Bankex index ended lower by (4.42%) or 362.52 points at 7,841.76. IDBI Bank (9.65%), Allahabad Bank (9.53%), Bank of India (8.33%), Yes Bank (8.05%) and PNB (7.14%) ended in negative territory.
The BSE Consumer Durables index fell (4.41%) or 133.51 points to close at 2,897.33. Losers are Gitanjali Gems (11.79%), Rajesh Export (11.24%), Videocon Industries (6.34%) and Titan Industries (2.50%).
The BSE Power slipped (3.46%) or 104.18 points at 2,904.46. Losers are GVK Power (7.74%), Suzlon Energy (6.72%), Power Grid (3.68%), Reliance Power (3.09%) and NTPC (2.48%).
The BSE Capital Goods index dropped (3.18%) or 411.01 points to close at 12,511.43. Losers are Reliance Industrial Infra (13.51%), Punj Lloyd (10.65%), Praj Industries (9.19%), Alstrom Project (8.03%), Everest Kanto (6.58%) and Bharat Electrical (6.50%).
The BSE Auto decreased (2.66%) or 131.21 points at 4,802.85. Losers are Ashok Leyland (9.64%), Tata Motors (6.25%), Bajaj Auto (5.54%), Cummins India (3.34%) and Exide Industries (3.40%).
Jaiprakash Associates Ltd plunged 10.40% to close at Rs207.25. The company has announced the following Audited results for the year ended March 31, 2009. The Company has posted a net profit of Rs 8970.10 million for the year ended March 31, 2009 where as the same was at Rs 6096.70 million for the year ended March 31, 2008. Total Income is Rs 61479.30 million for the year ended March 31, 2009 where as the same was at Rs 42612.00 million for the year ended March 31, 2008.
Indiabulls Real Estate Ltd tumbled 10.06% to Rs208.20. The company has announced the following Audited results for the year ended March 31, 2009. The Company has posted a net profit after extraordinary items of Rs 165.616 million for the year ended March 31, 2009 as compared to Rs 4677.091 million for the year ended March 31, 2008. Total Income has decreased from Rs 6488.779 million for the year ended March 31, 2008 to Rs 1397.630 million for the year ended March 31, 2009.
Rei Agro Ltd fell 7.30% to Rs90.85. The company has announced the following Audited results for the quarter & year ended March 31, 2009. The Company has posted a net profit of Rs 129.735 million for the quarter ended March 31, 2009 as compared to Rs 223.573 million for the quarter ended March 31, 2008. Total Income has increased from Rs 6314.109 million for the quarter ended March 31, 2008 to Rs 8574.322 million for the quarter ended March 31, 2009.
Indiabulls Financial Services Ltd declined 4.62% to rs184.65. The company has announced the following Audited results for the year ended March 31, 2009. The Company has posted a net profit of Rs 1901.721 million for the year ended March 31, 2009 as compared to Rs 3819.700 million for the year ended March 31, 2008. Total Income has increased from Rs 13278.456 million for the year ended March 31, 2008 to Rs 17835.086 million for the year ended March 31, 2009.
Divis Laboratories Ltd closed up by 0.26% at Rs1194.65. The Company has posted a net profit of Rs 4244.50 million for the year ended March 31, 2009 as compared to Rs 3535.60 million for the year ended March 31, 2008. Total Income has increased from Rs 10468.00 million for the year ended March 31, 2008 to Rs 12135.70 million for the year ended March 31, 2009. Moreover, the company has recommended issue of bonus shares in the ratio of one share for every share held, subject to approval of members.
Small-cap, mid-cap indices tank as market corrects after a steep rally
The key benchmark indices dropped from multi-month highs as weak European markets and lower US index futures triggered profit taking after a recent solid surge. The BSE 30-share Sensex was down 437.63 points, or 2.9%, off close to 545 points from the day's high. The Sensex fell below psychological 15,000 mark and the S&P CNX Nifty fell below psychological 4,500 mark.
The market was volatile. A sharp fall in the BSE Sensex within seconds of commencement of trade took market men by surprise. Equally surprising was an instant rebound when it moved into the green. However, the recovery was short lived. The market weakened in morning trade before cutting losses. Volatility was high in early afternoon trade. The market slumped in late trade.
European shares fell on Monday, led by commodity stocks and banks but drugmakers offered some support. Key benchmark indices in France, Germany and UK were down by between 1.26% to 1.59%.
European election results out over the weekend showed that conservative parties gained ground, with the move delivering a blow to socialists who had hoped to gain support in the economic downturn.
Asian markets were mixed. Stocks rose in Japan buoyed by a weaker yen that pushed up exporters such as Canon Inc. Japanese stocks rose even after a government report showed the country's current-account surplus narrowed in April 2009 as the global recession cut demand for exports. The Nikkei was up 1%.
China's Shanghai Composite was up 0.52%. George Soros, chairman and founder of Soros Fund Management LLC, said China will be the first country to recover from the global financial crisis, the Shanghai Daily reported today.
But key benchmark indices in Hong Kong, Singapore, South Korea and Taiwan were down between 0.1% to 3.34%.
US stocks futures slumped on worries that higher borrowing costs will threaten a recovery of the US economy. Trading in the US index futures indicated the Dow could fall 80 points at the opening bell today, 8 June 2009.
Yields on 10-year Treasury notes rose 2 basis points to 3.85%. Yields move in the opposite direction to prices. The sell-off in the bond market also has fueled concern about stock valuations.
Wall Street ended a choppy session on a flat note on Friday, 5 June 2009. Concerns that higher borrowing costs will threaten an economic recovery overshadowed a better-than-estimated employment report. The Dow was up 12.89 points, or 0.2%, to 8,763.13. The S&P 500 index was down 2.37 points, or 0.3%, to 940.09, and the Nasdaq Composite Index fell 0.60 points, or less than 0.1%, to 1,849.42.
The US Labor Department said on 5 June 2009 payrolls fell by 345,000 in May 2009. The job losses were much lower than expectations. On the flip side, the unemployment rate jumped to 9.4%, the highest in more than two decades and higher than the 9.2% expected.
The Bank for International Settlements said in its quarterly report today that the worst of the global recession may be over as governments and central banks have been successful in restoring investor confidence.
Closer home, foreign funds made heavy purchases of Indian stocks in the past three months. Their inflow totaled Rs 2,599 crore in June 2009 (till 5 June 2009) after buying hefty Rs 20,606.80 crore in May 2009. FII inflow in calendar year 2009 totaled Rs 23,918.40 crore (till 5 June 2009).
On the back of heavy buying by foreign funds, the Sensex had jumped 5456.24 points or 56.55% in calendar year 2009 to 15,103.55 on 5 June 2009. From a 3-year closing low of 8,160.40 on 9 March 2009, the Sensex was up 6,943.15 points or 85.08% on 5 June 2009.
Meanwhile, as a major boost to the capital markets, members of the Securities and Exchange Board of India (Sebi) have reportedly suggested a phased reduction of the securities transaction tax as part of a package of measures to develop the capital markets.
President Pratibha Patil addressed to a joint session of both houses on Thursday, 4 June 2009 formally disclosing the agenda of the UPA coalition government. She said that the government would aim to revive economic growth with higher investments in sectors such as infrastructure, while adhering to fiscal prudence. Patil said steps would be taken to encourage foreign investment inflows, list shares of state-run firms and infuse more capital in banks. The government's immediate priority must be to focus on management of the economy that will counter the effect of the global slowdown, she added.
Patil said the new regime will develop a roadmap for listing public sector units, co-ordinate with other countries to bring back illegal money stashed in secret bank accounts, recapitalise public sector banks, and bring in the pension reforms bill.
On the economic front, the government's immediate focus would be on sectors that are adversely hit, especially small and medium enterprises, exports, textiles, commercial vehicles, infrastructure and housing.
Meanwhile, equity analysts are raising earnings forecasts of India Inc on hopes that the new government will focus on infrastructure sector and push economic reforms to boost growth. Bulls may retail hold this month on expectations of favourable announcement for the industry in the Union Budget 2009-2010
The government reportedly plans to list only two state-owned companies Oil India (OIL) and National Hydroelectric Power Corporation (NHPC) this financial year through initial public offerings (IPOs) even as it aims to mop up Rs 6,500 crore via disinvestments by the year-end. The government will also dilute its holding in some companies where it holds more than 90% stake, including trading firms MMTC and State Trading Corporation of India (STC), as per a detailed annual disinvestment plan to be presented with the Union Budget in early July. The Budget will also contain the new government's broad sell-off plans for its first three years.
The government has the scope to raise funds through asset sales of state-run firms, the deputy chief of the Planning Commission said on Monday. Montek Singh Ahluwalia also told a news conference that there was a need for limiting subsidies.
Finance Minister Pranab Mukherjee is likely to present the Union Budget in the first week of July 2009 with focus on the common man while providing special attention to sectors hit hard by global crisis. Railway Budget for the year 2009-10 would be presented on 1 July 2009 followed by Economic Survey on 2 July 2009.
Investors expect financial sector reforms such as increase in the cap on foreign direct investment in insurance sector to 49%, from 26% at present. Finance Minister Pranab Mukherjee on 26 May 2009 said that a sustained stimulus to economic growth is possible by next round of reforms. He said reviving growth momentum is a top priority for the government adding that fiscal prudence will also be kept in mind.
Mukherjee said the government will stick to fiscal deficit target of 5.5% of GDP in the current financial year that ends on March 2010 (FY 2010). He said the government is committed to fiscal consolidation in 2-3 years. The minister said he would be able to announce the full-budget for FY 2010 by the first week of July 2009 and try to get it approved by 31 July 2009. He said the common man will be the focus of the government policy.
Ample global liquidity will help India Inc help raise funds for expansion which in turn will boost corporate profits. India Inc has already raised almost Rs 5,000 crore from three qualified institutional placements (QIPs) so far in 2009 and announced plans to raise another Rs 20,000 crore.
Falling interest rates will also support a larger capital expenditure programme of India Inc. Lower interest rates will also help sustain strong domestic demand. Late last week, India's biggest private sector bank by net profit ICICI Bank cut prime lending rate by 50 basis points
The BSE 30-share Sensex lost 437.63 points, or 2.9%, to 14,665.92. The Sensex rose 97.27 points at the day's high of 15,200.82 hit in the early trade. At the day's low of 14,604.23, the Sensex fell 499.32 points in late trade.
BSE clocked a turnover of Rs 7,335 crore, lower than Rs 8,997.38 crore on Friday, 5 June 2009.
The S&P CNX Nifty was down 157 points, or 3.42%, to 4,429.90. Nifty June 2009 futures were at 4413.50, at a discount of 16.40 points as compared to the spot closing of 4429.90. Turnover in NSE's futures & options (F&O) segment was Rs 65,877.10 crore, slightly lower than Rs 65,938.39 crore on Friday, 5 June 2009.
The market breadth, indicating the overall health of the market, turned weak in contrast to a strong breadth in early trade. On BSE, 577 shares rose as compared with 2,242 that declined. A total of 33 shares remained unchanged.
The BSE Mid-Cap index was down 5.45% and the BSE Small-Cap index was down 5.8%. Both the indices underperformed the Sensex.
The BSE Realty index (down 10.54%), the BSE Metal index (down 6.51%), the BSE Bankex (down 4.42%), the BSE Consumer Durables index (down 4.41%), the BSE PSU index (down 4.32%), the BSE Power index (down 3.46%), the BSE Capital Goods index (down 3.18%), underperfomed the Sensex.
The BSE IT index (up 1.57%), the BSE TECk index (down 1.21%), the BSE Healthcare index (down 2.22%), the BSE Oil & Gas index (down 2.52%), the BSE FMCG index (down 2.56%), the BSE Auto index (down 2.66%), outperformed the Sensex.
India's largest private sector firm by market capitalisation and oil refiner Reliance Industries (RIL) was down 1.04% to Rs 2,188.90. The stock was volatile. The stock hit a high of Rs 2,260 and a low of Rs 1,847.90 so far during the day. Its German unit Trevira, a specialty polyester manufacturer, became bankrupt last week. Reliance Industries had acquired Trevira five years ago for Rs 440 crore. This acquisition in 2004 had propelled Reliance to the position of the world's largest polyester fibre and yarn producer.
Meanwhile, the Bombay High Court is likely to deliver the final judgement on the legal tussle over the supply of gas from Reliance Industries (RIL) to Reliance Natural Resources (RNRL) this week when the court re-opens after summer vacations.
The basic argument in the RIL-RNRL case pertains to the pricing and quantum of gas RIL has to supply s from its Krishna Godavari basin to RNRL for RNNL's upcoming 7400 megawatt (MW) power project at Dadri in Uttar Pradesh.
Oil exploration stocks fell after crude oil prices dropped. India's biggest state-run oil exploration firm by revenue Oil & Natural Gas Corporation (ONGC) declined 5.59% and Cairn India fell 5.29%. US crude oil futures and London Brent prices fell by more than $1 a barrel on Monday after a stronger US dollar and profit-taking prompted a retreat from a seven-month high above $70 hit last week. Nymex crude fell $1.06 to $67.38 while London Brent was down $1.04 at $67.30. The fall in crude oil prices would result in lower realizations from crude sales for oil exploration firms.
Banking stocks fell as higher bond yields will result in diminution in value of banks' bond portfolio. India's largest private sector bank by net profit ICICI Bank was down 3.58% even as its American depository receipt (ADR) rose 1.34% on Friday, 5 June 2009.
ICICI Bank cut prime lending rate by 50 basis points with effect from Friday, 5 June 2009. The benchmark advance rate, or the rate that it charges its top customers, will drop to 15.75% from 16.25%. It also cut floating reference rate (FRR) applicable to floating rate retail loans (including floating rate home loans) by 50 basis points. The revised FRR will be 12.75% from 13.25%. All the existing floating rate customers to benefit from the cut.
India's second largest private sector bank by operating income HDFC Bank was down 1.37% even as its ADR rose 0.47% on Friday.
India's biggest bank in terms of branch network State Bank of India (SBI) was down 6.76%. As per recent reports, SBI may cut lending rates by 25 basis points.
India's biggest dedicated housing finance firm by operating income HDFC was down 3.78%.
Bond yields rose on Monday after the authorities raised the auction size for a fourth consecutive week, indicating the government could be borrowing more than expected. The government said after the market closed on Friday it would raise Rs 15000 crore on Thursday, 11 June 2009, up from a scheduled Rs 12000 crore.
Sentiment was also dented by a smaller-than-expected loss of US jobs in May 2009 that slammed the US Treasury debt market on Friday, kindling fears the Federal Reserve might raise rates sooner than previously thought. At 10:50 IST, the yield on the 10-year benchmark bond was at 6.60%, above Friday's closing of 6.56%. Bond prices and bond yields are inversely related.
Realty stocks fell on profit taking after recent gains on expectations that stability at the Centre will attract more money from foreign investors into the sector which in turn will boost growth. DLF, Unitech, Omaxe fell by between 9.97% to 13.8%.
Indiabulls Real Estate slumped 10.06% on reporting net loss of Rs 3.90 crore in Q4 March 2009 as compared to net profit of Rs 27.82 crore in Q4 March 2008.
Unitech and Indiabulls Real Estate, have already raised funds through qualified institutional placements (QIPs). A number of other realty funds have decided to raised funds by way of QIPs. The promoters of DLF last month sold a 10% stake in the secondary equity markets.
Metal stocks fell as US copper futures ended lower on Friday 5 June 2009, as currency-related sales weighed on metal prices after data showing the US economy lost a fewer-than-expected 345,000 jobs in May 2009. The data fueled a sharp rally in the dollar. Steel Authority of India, National Aluminum Company, Hindalco Industries and Sterlite Industries fell by between 3.27% to 9.07%.
India's largest steel maker by sales Tata Steel fell 10.21% even as its total steel sales rose 18% to 4.69 lakh tonnes in May 2009 over May 2008.
Cement stocks fell on profit taking after a recent rally triggered by healthy growth in cement shipments by most cement companies in May 2009. India Cements, Ultratech Cements, ACC, Ambuja Cements fell by between 3.28% to 8.06%.
Capital goods stocks fell on profit taking a recent surge triggered by hopes the government will provide a thrust to the infrastructure sector. Bharat Heavy Electricals, Crompton Greaves, Punj Lloyd, ABB, Siemens, Thermax, Praj Industries fell by between 0.65% to 8.03%.
Among construction stocks, Hindustan Construction Company, IVRCL Infrastructure & Projects and Gammon Infrastructure, fell by between 6.69% to 9.15%.
Healthcare stocks fell on profit taking after a recent rally triggered by hopes the government will give primary importance to healthcare segment and health of citizens. Ranbaxy Laboratories, Biocon, Wochardt, Pfizer, Cipla fell by between 0.12% to 6.45%.
FMCG stocks fell on delay in monsoon. Marico, United Spirits, Tata Tea, Dabur India and ITC fell by between 2.07% to 7.33%. FMCG companies derive most of their revenues from the rural market.
According to the the India Meteorological Department (IMD), the monsoon, which normally hits Kerala coast on 1 June 2009, had reached there around a week earlier this year and was expected to make a rapid progress. However, cyclone Aila, which hit west Bengal region and the Bay of Bengal on 23 May 2009, had affected the progress of the monsoon.
Outsourcing focussed IT stocks rose on talks worst may be over for the US economy and the US banking system. US is the biggest market for Indian IT firms. A sharp slide in the rupee against the dollar also aided recovery in IT stocks. IT stocks had underperfromed the market in the past one month due to a sharp surge in the rupee against the dollar.
India's second largest software firm by sales Infosys Technologies rose 2.52%. Infosys Technologies reportedly plans to open a software development and back office centre in Brazil later this year to serve US customers better from a near-shore presence. Its ADR gained 1.21% on Friday.
India's third largest software services exporter by sales Wipro rose 3.36%. Its ADR rose 0.24% on Friday. India's largest software services exporter by sales TCS rose 2.29%.
A firm rupee affects operating margins of IT firms negatively as IT companies derive a lion's share of revenue from exports. The Indian rupee edged lower in early trade on Monday tracking the dollar's rise against major currencies overseas. The partially convertible rupee was at 47.54/55 per dollar, weaker from its previous close of 47.105/115.
Auto stocks fell on profit taking after recent surge triggered by improved sales in the month of May 2009. Tata Motors, Mahindra & Mahindra, Maruti Suzuki India and Bajaj Auto fell by between 1.78% to 6.25%.
Shares of state-run companies fell on profit taking after a recent surge triggered on hopes of recommencement of the PSU disinvestment programme by the Congress-led UPA government. Neyveli Lignite Corporation, MMTC, Hindustan copper, Central Bank of India, Power Finance Corporation, NMDC, HMT and Shipping Corporation of India fell by between 0.26% to 9.44%.
Airline stocks fell after the International Air Transport Association said on Monday that global airlines are likely to lose $9 billion this year, nearly double its estimate of just three months ago, as rising fuel prices and weak demand create an unprecedented crisis for the industry. Jet Airways, Kingfisher Airlines and SpiceJet fell by between 9.63% to 12.32%.
Dish TV clocked the highest volume of 7.32 crore shares on BSE. Unitech (3.4 crore shares), Suzlon Energy (2.32 crore shares), Reliance Naturla Resources (2.05 crore shars) and MRPL (1.96 crore shares) were the other volume toppers in that order.
Dish TV clocked the highest turnovewr of Rs 329 crore on BSE. Unitech (Rs 286.78 crore), Suzlon Energy (Rs 284.41 crore), Reliance Industries (Rs 230.43 crore) and Reliance Capital (Rs 212.45 crore) were the other turnover toppers in that order.
Pre Session Commentary - June 8 2009
Today domestic markets are likely to open positive as majority of Asian markets have also opened in the green. The opening trade would however start on a subdued note due to lack of any driving news. The government has finally declared the divestment of Rs. 6,500 crore during the current fiscal with IPOs of only two PSUs. On the other hand, the US employment data is showing signs of recovery and hence traders across the globe would capitalize on the improving conditions of US economy. The opening of the European markets would further decide the movement of domestic and Asian markets.
On Friday, the domestic markets closed with moderate gains thus recording the 13th consecutive weekly gain and the longest since August 2005. The session started with a subdued opening however as the day progressed the benchmark indices exuded firmness. The better U.S. jobs data helped boost the morale of traders across Asia and Europe. Further the mining companies were in the limelight after Rio Tinto PLC scrapped $19.5 billion deal with China’s Chinalco and opted to raise $15.2 billion in equity sale and so as to setup a JV with rival BHP Billiton. The Capital Goods stocks were the charm of the day due to huge fund buying. On the other hand IT, gained due to signs of recovery in U.S. economy. Sectors like CG, IT, Auto and Tech inclined by 2.95%, 2.61%, 2.49% and 1.58% respectively. On the other hand, Mid cap and Small cap stocks were underperformers due to profit booking pressures and lost 0.67% and 1.02% respectively. We expect the markets to be trading volatile.
The BSE Sensex closed with a gain of 94.87 points at 15,103.55 and NSE Nifty ended up by 14.25 at 4,586.90. BSE Mid Caps and Small Caps closed with losses of 36.30 points and 66.54 points at 5,409.78 and 6,458.65 respectively. The BSE Sensex touched intraday high of 15,257.30 and intraday low of 14,993.60.
On Friday, the US Markets closed mixed. The markets started with a subdued trading sentiment as the non-farm better than expected job data of the previous day faded. Traders however started picking up stocks higher after the news about the payrolls data that fell by 345,000 during May. The job losses numbers were below the 520,000 that were expected and far below than the 504,000 that were recorded during the month of April. On the other hand on a macro economic scenario the unemployment data has reached 26 years high of 9.4% up from 8.9%. The semiconductor stocks were under pressure after the Semiconductor Association forecast a 21% yoy decline in 2009 worldwide sales. The US light crude oil for July delivery declined by 0.5% to settle at $68.43 per barrel on the New York Mercantile Exchange.
The Dow Jones Industrial Average (DJIA) closed high by 12.89 points at 8,763.13, the NASDAQ Composite (RIXF) index declined by 0.60 points to close at 1,849.42 and the S&P 500 (SPX) fell by 2.37 points to close at 940.09.
The Indian ADRs ended mixed on Friday. In the telecom space, Tata Comm was down 1.84% and MTNL was down 1.20%. In the banking space, ICICI Bank was up 1.34% while HDFC Bank was up 0.47%. In the IT space, Satyam was down 5.24%, Patni was down 3.84%, while Infosys was up 1.21% and Wipro was up 0.24%. In the other space, Dr Reddys was up 3.88%, Sterlite was up 1.43% and Tata Motors was up 1.45%.
Today major stock markets in Asia are trading positive. Hang Seng is low by 48.18 points at 18,631.35. Shanghai Composite is up by 10.97 points at 2,764.86. Japan''s Nikkei is trading up by 109.78 points at 9,877.79. Strait Times is also up by 17.88 points at 2,380.62. KLSE Composite is up by 11.53 points at 1,075.50.
The FIIs on Friday stood as net buyers in equity and debt. Gross equity purchased stood at Rs 3,626.10 Crore and gross debt purchased stood at Rs 398.10 Crore, while the gross equity sold stood at Rs 2,955.50 Crore and gross debt sold stood at Rs. 145.00 Crore. Therefore, the net investment of equity and debt reported were Rs 670.60 Crore and Rs 253.10 Crore respectively.
On Friday, the partially convertible rupee closed at 47.11/12 per dollar, 0.19% stronger than it previous close at 47.20/21. The rupee gained strength due to positive trend in local stock markets.
On BSE, total number of shares traded were 83.27 Crore and total turnover stood at Rs 8,997.38 Crore. On NSE, total number of shares traded was 162.31 Crore and total turnover was Rs 26,776.46 Crore.
Top traded volumes on NSE Nifty – Unitech with 100257779 shares, Suzlon Energy with 81375440 shares, ITC with 26355126 shares, Idear Cellular with 17353967 shares, followed by SAIL with 13473262 shares.
On NSE Future and Options, total number of contracts traded in index futures was 661210 with a total turnover of Rs 14,604.08 Crore. Along with this total number of contracts traded in stock futures were 475756 with a total turnover of Rs 29,441.38 Crore. Total numbers of contracts for index options were 859423 with a total turnover of Rs 19,882.74 Crore and total numbers of contracts for stock options were 33011 and notional turnover was Rs 2,010.19 Crore.
Today, Nifty would have a support at 4,545 and resistance at 4,656 and BSE Sensex has support at 14,938 and resistance at 15,298.
Daily News Roundup - June 8 2009
Supreme Court dismissed the Mukesh Ambani-promoted Mumbai SEZ plea for staying the land acquisition process for its project in Raigad, Maharashtra.(BL)
Citigroup to raise fresh capital via sale of its 11.73% stake in HDFC. (ET)
ONGC to invest $350m more in Cairn India oilfields.(FE)
Tax issue may delay Cairn India’s crude oil output from Barmer in Rajasthan.(BL)
Reliance Communications intends to raise funds from qualified institutional investors either through a share sale or an issue of financial instruments.(BL)
Infosys plans to open a software development and back office centre in Brazil. (ET)
Tech Mahindra extends open offer date for Satyam shares.(FE)
BPCL open to Oman Oil hiking stake in Bina refinery.(BL)
Jain Irrigation has bagged a World Bank project worth Rs778mn for execution this year.(BL)
NTPC is currently working on various new projects which will together add a new capacity of 18,000MW.(FE)
NTPC has lined up funding of nearly Rs220bn from Power Finance Corporation, LIC, domestic banks and financial institutions to finance its capital expenditure for the current fiscal. (ET)
Akruti City plans to raise up to US$500mn through the qualified institutional placement route. (ET)
Michelin sells 3.3% stake in Apollo Tyres for around Rs450-500mn in the open market. (ET)
Apollo Group plans to invest Rs1.5bn in Hyderabad to fund its expansion plans. (ET)
REI Agro plans to raise US$150mn through fresh issuance of shares. (ET)
Apollo Hospitals Group has sealed a deal with International Finance Corporation for a funding of $50mn.(BL)
Tamil Nadu government gives approval to the Toshiba-JSW JV for setting up a supercritical power equipment manufacturing facility near Chennai. (BS)
Twelve financial institutions sanction ~Rs16bn to Reliance Power to part-finance the first phase of a 600MW Group Captive Power Project (GCPP) at Butibori in Maharashtra. (ET)
GMR Infrastructure is readying a capital expenditure of Rs70bn for this fiscal to fund its existing and new projects.(DNA)
JSW Steel reported a growth of 33% in crude steel production for May 2009 as compared with the year-ago period.(FE)
Siemens plans to open a factory in Aurangabad this fiscal to produce industrial goods for the transportation sector.(BL)
JSW Steel and Jindal Steel and Power are considering increasing prices of their products following the firming global cues and the improvement in domestic demand. (BS)
Reliance Life Insurance to enter the capital market to mop up Rs15-20bn through an IPO. (BS)
3i Infotech to set up wholly owned business process outsourcing subsidiary. (BS)
Wockhardt to sell hospitals to raise Rs10bn.(FE)
Suzlon completes buy of Martifier’s stake in REpower.(BL)
Tata Steel’s India operations show a 23% yoy increase in production of saleable steel in May.(FE)
Power Grid plans Rs50bn bond issues this fiscal.(DNA)
BSNL invited bids afresh from private players to roll out WiMax services on a franchisee basis.(BL)
Vedanta Aluminium believed to be in talks with banks, including SBI, to raise Rs 100bn debt to part fund its Orissa project.(TOI)
Areva, the world’s biggest maker of atomic reactors, has offered India stakes in African uranium mines to ensure supplies for fuel starved plants.(TOI)
Aban Offshore seeks Rs140bn debt recast.(TOI)
Finance Ministry has appointed Dr K.C Chakrabarty, CMD of Punjab National Bank, as a Deputy Governor of the Reserve Bank of India.(BL)
Indraprastha Gas plans to invest Rs16bn to expand its retail outlets and PNG network in and around the metropolis. (BS)
Wipro plans to expand its Eco-eye programme which works for the cause of ecological sustainability. (BS)
Cairn India is anticipating over 1.3mn tonnes of crude oil production from the Ravva field in the KG-basin during the current financial year. (BS)
Government plans to list only two stateowned companies, Oil India and NHPC this financial year through IPOs. (ET)
SEBI suggests a phased reduction of the securities transaction tax, as part of a package of measures to develop the capital markets. (BS)Foreign exchange reserves increased by US$1.7bn to US$262bn for the week ended May 29.(BL)
Bank credit declines second time this fiscal.(BL)
Defence forces agree to free spectrum within three years.(Mint)
Net direct tax collection increases 16.9% in May.(BL)
Coal sector’s growth in April rises to 13% compared with 10.4% growth in the same month last year. (BS)
Shipping Ministry would award projects worth more than Rs33bn for developing and upgrading container and cargo terminals at various ports in the country. (BS)
Government reconstituted the Planning Commission, expectedly asking Montek Singh Ahluwalia to continue as the deputy chairman, while naming three new members to the apex planning body.(TOI)
RBI wants administered interest rates revisited.(FE)
23 FDI proposals worth Rs5.6bn cleared by the government.(BL)
The Finance Minister to meet bankers on June 10 to review the interest rate situation and discuss the targets and strategies to boost growth. (BS)
The Haryana government draws up an investment plan of Rs17.94bn for the current financial year to strengthen the power distribution system in the state. (BS)
Miles ahead, bulls may take a nap!
Kilometers are shorter than miles. Save gas, take your next trip in kilometers.
After rising for 13 straight weeks, will the market run out of gas? That’s the question uppermost on the minds of most market players. The start could be a bit soft given the weakness in Asian benchmarks. US stocks too couldn’t cash in on the positive jobs report on Friday, though the Dow did manage to hold above its 200 DMA. Nifty level to watch out for is 4650.
The rally could slow over the next few days and the market may turn sideways. Event-based action will continue in the near term. The bulls do have miles to go, but they may prefer a short nap before that!
What India needs is a union budget that will accelerate economic growth while maintaining fiscal discipline. It is going to be a tall order for Pranab Mukherjee. Of course, a few IPOs of state-owned companies and stake sales in others will help the Centre further slippages on the fiscal front.
Reports say SEBI has asked Finance Ministry to reduce STT gradually. This might help market sentimentally. For now its just a proposal.
For those who swear by technical charts, it is noteworthy that the Dow is above its 200 DMA of 8723 as of Friday’s close. The next crucial resistance for the Dow is around 9000-9200. Back home, the Nifty managed to cross 4600, albeit briefly. It could find some resistance around 4650. The index is likely to move in a broad range of 4450-4650. A strong uptrend could be in store if the 100 DMA crosses 200 DMA.
Despite concerns about the market being overheated, the liquidity deluge could continue to power the current rally even as fundamentally stocks appear to be expensive. Barring exports, most economic indicators are showing signs of a gradual upturn. Globally, crucial data points are underscoring a widely held view that the worst of the recession is over.
FIIs were net buyers in the cash segment on Friday at Rs8.32bn while the local institutions pulled out Rs4.8bn. In the F&O segment, the foreign funds were net buyers at Rs11.73bn. On Thursday, FIIs were net buyers at Rs6.7bn in the cash segment. Mutual Funds were net sellers at Rs4.03bn on the same day.
Some buzz doing the rounds on Infosys besides reports of setting up unit in Brazil. More on it when we have something more concrete. Meanwhile, Wal-Mart Stores has shortlisted TCS, Infosys and Wipro, for an outsourcing contract worth up to $500mn, says a report.
German chemical major Lanxess AG is believed to be close to acquiring India's Gwalior Chemical Industries Ltd. Talks are said to be in an advanced stage at the moment but an official announcement could be made this week. On Monday, the German major is holding a press conference in Mumbai to announce its Asia growth strategy.
US stocks ended nearly unchanged on Friday after a volatile start, as a surprisingly strong monthly jobs report was countered by concerns that higher borrowing costs could derail the tentative economic recovery.
Traders also appeared to be worried about potential threat from inflation going forward, as the government has been pumping money at a rapid clip over the past several months to revive economic growth.
The Dow Jones Industrial Average added 13 points, or 0.1%, to 8,763.13, trimming its yearly decline to less than 0.2%. The S&P 500 index lost 2 points or 0.3%, to close at 940.09. It is up 4.1% in 2009.
The S&P 500 rallied 2.3% last week, extending a three-month rally that lifted the index by 39%. The broader market barometer has advanced for the past three weeks as reports on home sales, durable goods orders and consumer confidence beat economists’ forecasts.
The Nasdaq Composite index ended near unchanged, at 1,849.42.
Off 12-year lows since early March, the Dow has now gained in 11 of the last 13 weeks, adding 32.2%. That is the Dow's best 13-week run since the period ending November 1982, according to Dow Jones market data.
About nine stocks dropped for every seven that rose on the New York Stock Exchange.
In the day's main economic report, the Labour Department said that US companies cut about 345,000 jobs from their payrolls in May. The reading surpassed economists expectations of another 520,000 job cuts. Employers cut a revised 504,000 jobs in April.
According to a separate survey, the unemployment rate rose to 9.4%, a 26-year high, from 8.9% in April. Economists were expecting it to rise to 9.2%.
Experts remain divided on whether the worst is over for the US labor market. In particular, the bankruptcy filings of Chrysler and General Motors (GM) could result in more job losses over the next few months.
Speculation that the government had underestimated the drop in jobs last month later pushed the S&P 500 down about 1.8% from its intraday peak. But, the rumor was denied by the Labor Secretary Hilda Solis, helping spur a 1.4% rebound in the benchmark before it turned lower again due to weakness in banks and commodity shares.
Federal funds futures contracts on the Chicago Board of Trade show a 70% probability that the American central bank will hike its target rate for overnight bank borrowing to at least 0.5% by November after the US economy shed the fewest jobs in May in eight months. The odds of a rate hike were at 27% on Thursday.
After the close on Friday, it was announced that an appeals court ruling has cleared the way for Chrysler to exit bankruptcy, probably Monday afternoon. The ruling set aside an Indiana pension fund's objections and allows Chrysler to sell a majority of its assets to a new company to be called the Chrysler Group. The new company will be owned primarily by a United Auto Workers union trust, Italian automaker Fiat and the US government.
Meanwhile, GM said that it will sell its Saturn brand to car dealership operator Penske Automotive Group. Earlier this week, GM sold its Hummer line to China's Sichuan Tengzhong, a machinery company. The sales are part of GM's plan to sell its four "non-core" US brands, including Pontiac and Saab.
Separately, GM will reportedly help finance private equity firm Platinum Equity's purchase of bankrupt auto parts supplier Delphi Corp. Friday was GM's last day as a Dow component. On Monday, it will be swapped with tech leader Cisco Systems.
The Federal Deposit Insurance Corp. (FDIC) is reportedly looking to shake up Citi's management, putting CEO Vikram Pandit's job at risk. The financial firm has received billions in government aid and was also recently told to raise US$5.5bn as a result of the government stress tests.
Friday was Citi's last day as a Dow component. On Monday, it will be replaced by insurance firm Travelers.
Rio Tinto has dropped its US$19.5bn merger with Chinese company Chinalco, and has instead decided to form a joint venture with rival BHP Billiton. Rio also announced the launch of a heavily discounted rights issue to raise about US$15.2 billion in gross proceeds.
Shares of Rio shot up 10.3% while BHP Billiton shares also rose, up 6.8% in London dealings.
Treasury prices tumbled, raising the yield on the benchmark 10-year note to 3.83% from 3.71%. The yield on benchmark 10-year notes, which influence rates on mortgages and other consumer loans, has climbed more than 1% since the Fed announced its program to purchase long-term Treasuries in March.
Federal Reserve's policy makers next meet June 23-24 and may consider whether to increase their planned purchases of US$1.45 trillion of housing-related debt and US$300bn of long-term Treasuries.
In currency trading, the dollar gained versus the euro and yen. The dollar index, which measures the performance of the greenback against a basket of currencies, reached 80.701, up from 79.446 on Thursday. It had reached a high of 88.105 in early March. Since then, the dollar has dropped nearly 9%.
For the week, the dollar index has gained 1.4%, its best week since early April. The euro has lost 1% against the US currency. The dollar also had its best week since February versus the yen, adding 2.7%.
US light crude oil for July delivery fell 37 cents to settle at US$68.44 a barrel on the New York Mercantile Exchange.
COMEX gold for August delivery slipped US$19.70 to settle at US$962.60 an ounce.
Better-than-expected US jobs report coupled with Rio's move to scrap a deal with Chinalco sent European stock benchmarks higher on Friday.
The pan-European Dow Jones Stoxx 600 index climbed 0.7% to 210.97, snapping a three-session losing streak.
The commodities-oriented FTSE 100 index rose 1.2% to 4,438.56 in London, while the French CAC-40 index gained 0.8% to 3,339.05 and Germany's DAX 30 index was up 0.2% at 5,077.03.
Indian markets resumed its up run after ending on a flat note in the past coupled of trading session. Falling inflation and UPA’s reassurance of maintaining high economic growth with low inflation lifted the sentiment on Dalal Street.
All round buying was witnessed with the Realty, Capital, Goods, Power, mid-cap and the small-cap among the major gainers.
The Sensex gained 137 points or 0.9% to end at 15,007 after touching a high of 15,026 and a low of 14,599. The index had opened at 14,755 against the previous close of 14,871.
The NSE Nifty added 40 points or 0.9% to shut shop at 4,570.
Among the BSE Sectoral indices BSE Capital Goods index was the top gainer surging 3.3%, followed by the BSE Realty index up 3%, BSE Pharma index up 2.5%, BSE Power index up 2.1% and BSE PSU index up 1.7%.
Shares of Tata Motors gained by 2% to Rs369 after reports stated that the company has secured an order to supply 4,689 buses for the JNNRUM project. The scrip touched an intra-day high of Rs374 and a low of Rs352 and recorded volumes of over 0.9m shares on BSE.
Shares of GVK Power gained by 2% to Rs48 following the company’s announcement that it is planning to raise Rs25bn via the QIP route. The scrip touched an intra-day high of Rs50.4 and a low of Rs47 and recorded volumes of over 20.2mn shares on BSE.
Shares of Union Bank gained by 1% to Rs217 following reports that the company was eying business of Rs3trillion in FY10. The scrip touched an intra-day high of Rs220 and a low of Rs212 and recorded volumes of over 64,000 shares on BSE.
Shares of Pantaloon Retail advanced by 1% to Rs322. According to reports the company has delayed its restructuring plan as it awaits a favorable FDI policy. The scrip touched an intra-day high of Rs330 and a low of Rs309 and recorded volumes of over 0.2mn shares on BSE.
Shares of Network 18 surged by over 3.5% to Rs160. The company announced that it would raise Rs1.2bn through preferential allotment of shares to Asian private equity firm SAIF Partners, stated reports. The scrip touched an intra-day high of Rs166.8 and a low of Rs145 and recorded volumes of over 0.3mn shares on BSE.
With the BSE Sensex closing above the 15000 levels for the first time since September 2008, the bulls would look to capitalize and build on to further gain ground. However, one cannot rule out profit booking as Friday being the last trading session of the week, traders and investors would look to lock in some gains.
Market may open in the green
The key benchmark indices set to start the day's trade in green tracking gains in most of Asia. However profit taking after recent solid surge may cap the gains.
Most of the Asian stocks were trading higher today. Japan's Nikkei average hit its highest point in eight months on Monday, buoyed by a weaker yen that pushed up exporters such as Canon Inc and by hopes for a recovery in the U.S. economy after it shed fewer jobs than expected in May 2009. Japan's Nikkei rose 1%. Key benchmark indices in China, South Korea and Singapore rose by between 0.36% to 0.68%. While key benchmark indices in Hong Kong and Taiwan fell by between 0.82% to 1.6%.
Wall Street ended a choppy session on a flat note on Friday, 5 June 2009. The Dow was up 12.89 points, or 0.2%, to 8,763.13. The S&P 500 index was down 2.37 points, or 0.3%, to 940.09, and the Nasdaq Composite Index fell 0.60 points, or less than 0.1%, to 1,849.42.
In the economic data, the unemployment rate jumped to 9.4%, the highest in more than two decades and higher than the 9.2% expected. Non-farm payrolls however, declined much less than expected. Employers cut payrolls by 3,45,000 in May 2009, well below the 525,000-drop expected.
Back home, the Sensex jumped 5456.24 points or 56.55% in calendar year 2009 to 15,103.55 on 5 June 2009 its highest closing since 12 August 2008. From a 3-year closing low of 8,160.40 on 9 March 2009, the Sensex is up 6,943.15 points or 85.08%.
The recent solid surge in the market materialised as foreign funds' pumped Rs 1,181.60 crore in the month of June 2009 after buying hefty Rs 20,606.80 crore in May 2009 and their inflow in calendar year 2009 stood at Rs 22,501 crore (till 4 June 2009). As per the provisional data on NSE, foreign funds bought shares worth Rs 831.95 crore on Friday, 5 June 2009.
Meanwhile, as a major boost to the capital markets, members of the Securities and Exchange Board of India (Sebi) have reportedly suggested a phased reduction of the securities transaction tax as part of a package of measures to develop the capital markets.
In a political front, President Pratibha Patil addressed to a joint session of both houses on Thursday, 4 June 2009 formally disclosing the agenda of the UPA coalition government. She said that the government would aim to revive economic growth with higher investments in sectors such as infrastructure, while adhering to fiscal prudence. Patil said steps would be taken to encourage foreign investment inflows, list shares of state-run firms and infuse more capital in banks. The government's immediate priority must be to focus on management of the economy that will counter the effect of the global slowdown, she added.
Patil said the new regime will develop a roadmap for listing public sector units, co-ordinate with other countries to bring back illegal money stashed in secret bank accounts, recapitalise public sector banks, and bring in the pension reforms bill.
On the economic front, the government's immediate focus would be on sectors that are adversely hit, especially small and medium enterprises, exports, textiles, commercial vehicles, infrastructure and housing.
There are reasons to believe that the recent strong rally may continue. For one, equity analysts are raising earnings forecasts of India Inc on hopes that the new government will focus on infrastructure sector and push economic reforms to boost growth.
The investors expect a pre-budget rally over this month on hopes of accelerated economic reforms and pro-reforms announcements. The UPA government's comfortable victory, without the support of the Left parties, has raised expectations that the government may revive disinvestment programme. The Congress party had in its manifesto released before polls promised to go ahead with disinvestment while retaining a majority holding in the state-run companies. Disinvestment programme was earlier put on backburner due to stiff opposition from the Left front.
The government reportedly plans to list only two state-owned companies Oil India (OIL) and National Hydroelectric Power Corporation (NHPC) this financial year through initial public offerings (IPOs) even as it aims to mop up Rs 6,500 crore via disinvestments by the year-end. The government will also dilute its holding in some companies where it holds more than 90% stake, including trading firms MMTC and State Trading Corporation of India (STC), as per a detailed annual disinvestment plan to be presented with the Union Budget in early July. The Budget will also contain the new government's broad sell-off plans for its first three years
Finance Minister Pranab Mukherjee is likely to present the Union Budget in the first week of July 2009 with focus on ‘Aam Admi' while providing special attention to sectors hit hard by global crisis. Railway Budget for the year 2009-10 would be presented on 1 July 2009 followed by Economic Survey on 2 July 2009.
Investors expect financial sector reforms such as increase in the cap on foreign direct investment in insurance sector to 49%, from 26% at present. Finance Minister Pranab Mukherjee on 26 May 2009 said that a sustained stimulus to economic growth is possible by next round of reforms. He said reviving growth momentum is a top priority for the government adding that fiscal prudence will also be kept in mind.
Mukherjee said the government will stick to fiscal deficit target of 5.5% of GDP in the current financial year that ends on March 2010 (FY 2010). He said the government is committed to fiscal consolidation in 2-3 years. The minister said he would be able to announce the full-budget for FY 2010 by the first week of July 2009 and try to get it approved by 31 July 2009. He said the common man will be the focus of the government policy.
Congress candidate Meira Kumar was elected Speaker of the 15th Lok Sabha unanimously on Wednesday, 3 June 2009. Kumar is the first woman to be elected as the Speaker of the Lok Sabha. The first session of the 15th Lok Sabha started on Monday, 1 June 2009. The session will last till 9 June 2009. In all, the Parliament session will have seven sittings.
Good spirit at Wall Street
Dow manages to erase all of its year to date losses
Stronger than expected economic reports took US stocks higher for the week that ended on Friday, 05 June, 2009. Majority of the economic data that checked in were better than thought of. The most important of these reports was Friday's job report from the Labor Department. With the week's gains, Dow managed to erase all of its year to date loses and remains almost unchanged from prior year's ending mark. Crude prices rose substantially during the week. General Motors filing for bankruptcy was perhaps another major event of the week.
The Dow Jones Industrial Average gained 262 points (3.1%) for the week to end at 8,763.13. Tech - heavy Nasdaq gained 75.09 (4.2%) to end at 1,849.42. S&P 500 gained 20.95 (2.3%) to end at 940.09.
The indices rallied during start of the week after stronger international markets paved the way, as PMI manufacturing data came out all over the world. Markets in China and Hong Kong showed expansion for the third straight month, while UK and Eurozone showed modestly better-than-expected numbers.
Economic reports also gave further boost. Construction Spending surprisingly increased 0.8% month-over-month in April against an expected drop of 1.5%, personal income increased 0.5% for the month against an expected drop of 0.2%, and personal spending came in at a modestly better-than-expected -0.1% against an expected drop of 0.2%.
General Motors also lent good support to the Dow despite news that the company is filing for bankruptcy. According to GM CEO Fritz Henderson, GM believes it can complete bankruptcy in 60 to 90 days. Though GM remains a Dow component for now, Cisco is expected to replace GM in the Dow Jones Industrial Average from 8 June. As per latest reports, Citigroup will also get replaced by Travelers.
Economic reports dominated during the rest of the week. Pending Home Sales was reported on Tuesday, which showed a much larger-than-expected 6.7% month-over-month gain in April.
The Labor Department reported on Thursday, 04 June, 2009 that the number of continuing claims for state unemployment benefits declined by 15,000 to 6.74 million for the week ended 23 May, 2009. However, the four-week average of these claims rose by 88,750 to 6.69 million, a record-high level. First-time applications for benefits fell 4,000 to 621,000 in the week ended 30 May, 2009, reaching the lowest level since early May. The four-week average of these first-time claims rose 4,000 to 631,250. After reaching new weekly record highs since January, the number of continuing claims for state unemployment benefits has finally declined.
In the US market on Friday, 05 June, 2009, stocks surrendered early gains as enthusiasm for a better-than-expected nonfarm jobs report faded. For the rest of the session stocks generally traded sideways before closing in mixed fashion. The Dow Jones Industrial Average ended higher by 12.89 points at 8,763. The Nasdaq Composite Index, ended lower by 0.6 points at 1,849.42. S&P 500 ended lower by 2.47 points at 940. During session highs, Dow traded higher by almost 70 points.
The Labor Department reported on Friday that the intense pace of job destruction finally moderated in May as U.S. nonfarm payrolls declined by 345,000, the fewest jobs lost in eight months. While the payroll loss was much better than expected and hinted at some improvement in the economy, the U.S. unemployment rate jumped to a 26-year high of 9.4% in May as the number of jobless Americans rose by 787,000 to 14.5 million. The decline in payrolls was much less than the 500,000 forecast. However, the unemployment rate was higher than the 9.2% expected.
Weakness in the materials sector during the second half of trading, mainly due to the drop in commodity prices led to overall weakness in the market. The financial sector also witnessed substantial weakness.
A better than expected job report in US strengthened the dollar on Friday, 05 June, 2009, thereby pushing crude oil prices lower. The dollar rose on Friday following encouraging report that the intense pace of job destruction finally moderated in May, 2009 after the US economy witnessed one of the worst cases of layoffs in the past few months. On Friday, crude-oil futures for light sweet crude for July delivery closed at $68.44/barrel (lower by $0.37 or 0.5%). It had earlier risen to a high of $70.32. Despite Friday's loss, for the week, crude ended higher by 3.2%.
On Friday, Comex Gold for June delivery fell $19.5 (2%) to close at $961.7 an ounce on the New York Mercantile Exchange. For the week, gold ended lower by 1.8%. Comex silver futures for July delivery fell 50.7 cents (3.2%) at $15.388 an ounce. For the week, silver ended lower by 1.4%.
In the currency market on Friday, the dollar index, which weighs the strength of dollar against the basket of six other currencies, went up by 1%.
For the year 2009, Dow is down by just 0.2%. The Nasdaq and S&P 500 are up by 17.3% and 4.1% respectively.
US stocks end mixed
The Dow Jones Industrial gained, while the S&P 500 and Nasdaq dipped on Friday as investors paused after conflicting signals in monthly US jobs data. Investors sold some recent winners to take profits from the rally off 12-year lows in early March.
The Dow Jones Industrial average gained 12.89 points, or 0.15%, to settle at 8,763.13.
The Standard & Poor`s 500 index declined 2.37 points, or 0.25%, to end at 940.09.
The NASDAQ composite index sank 0.60 points, or 0.03%, to close at 1,849.42.
IFCI
We recommend a sell in IFCI stock from a short-term trading horizon. It is evident from the charts of IFCI that it bottomed in early March, taking support around Rs 16, which is a key intermediate-term support level. Since March low the stock has been trending up and is on an intermediate-term up-trend. The stock’s up-trend accelerated steeply in mid-May. However, after penetrating a key resistance at Rs 40, the stock encountered another resistance at Rs 60 recently. On June 5, the stock decline 5 per cent forming a dark cloud cover candlestick pattern. This pattern is a short-term bearish reversal pattern. Moreover, we notice that the daily relative strength index is displaying negative divergence, triggering the stock’s reversal. The weekly indicators are in overbought territory signalling near-term correction. The volumes are gradually reducing over the past three trading sessions. We take a contrarian view on the stock from a short-term perspective and anticipate it to tumble further until it hits our price target of Rs 48 in the approaching trading sessions. Traders with short-term perspective can sell the stock while maintaining a stop-loss at Rs 56.5.
via BL
Crude pares early gains
Prices drop as dollar strengthens in the wake of strong job report
A better than expected job report in US strengthened the dollar on Friday, 05 June, 2009, thereby pushing crude oil prices lower. The dollar rose on Friday following encouraging report that the intense pace of job destruction finally moderated in May, 2009 after the US economy witnessed one of the worst cases of layoffs in the past few months.
On Friday, crude-oil futures for light sweet crude for July delivery closed at $68.44/barrel (lower by $0.37 or 0.5%). It had earlier risen to a high of $70.32. Despite Friday's loss, for the week, crude ended higher by 3.2%.
Crude ended the month of May, 2009, higher by 30%. This was the largest month gain for crude in almost a decade. Prior to May, crude ended April and March, 2009 higher by 2.9% and 10.9% respectively. It rallied 11.3% in the first quarter. Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 50% since then. Year to date, in 2009, crude prices are higher by 38%.
In the currency market on Friday, the dollar index, which weighs the strength of dollar against the basket of six other currencies, went up by 1%.
The Labor Department reported on Friday that the intense pace of job destruction finally moderated in May as U.S. nonfarm payrolls declined by 345,000, the fewest jobs lost in eight months. While the payroll loss was much better than expected and hinted at some improvement in the economy, the U.S. unemployment rate jumped to a 26-year high of 9.4% in May as the number of jobless Americans rose by 787,000 to 14.5 million. The decline in payrolls was much less than the 500,000 forecast. However, the unemployment rate was higher than the 9.2% expected.
During the week Goldman Sachs increased its 2009 oil price forecast to $85 a barrel, up from $65 a barrel previously.
EIA had reported on Wednesday, 03 June that U.S. commercial crude inventories for the week ended 29 May rose to 366 million barrels, up 2.9 million barrels. Market was expecting a decline to the tune of 2 million barrels. EIA also reported that total motor gasoline inventories decreased by 200,000 barrels on the week, while distillate supplies increased 1.6 million barrels.
OPEC, in its latest meeting, decided to keep production quotas unchanged, in line with expectations. The cartel, which accounts for about one-third of the world's oil production, decided to leave production levels unchanged at today's meeting in Vienna on Thursday, 28 May, 2009.
Also at the Nymex on Friday, July reformulated gasoline fell 0.75 cent, or 0.4%, to $1.9546 a gallon on the Nymex, and July heating oil lost 1.39 cents, or 0.8%, to $1.7701 a gallon.
July natural-gas futures gained 11.8 cents, or 3.1%, to $3.868 per million British thermal units.
Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.
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