Futures and Options - Dec 14 2009
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Monday, December 14, 2009
Turnover rises
Bhel, Tata Steel December 2009 futures at premium
Nifty December 2009 futures were at 5,102.25, at a discount of 3.45 points as compared to the spot closing of 5105.70. Turnover in NSE's futures & options (F&O) jumped to Rs 73,694.26 crore from Rs 71,331.55 crore on Friday, 11 December 2009.
Bharat Heavy Electricals (Bhel) December 2009 futures at premium at 2,401.10 compared to the spot closing of 2,396.
Tata Steel December 2009 futures were at premium at 545.90 compared to the spot closing of 543.65.
State Bank of India December 2009 futures were at a slight discount at 2,245.50 compared to the spot closing of 2,247.
In the cash market, the S&P CNX Nifty fell 11.60 points or 0.23% at 5,105.70.
BSE Bulk Deals to Watch - Dec 14 2009
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
14/12/2009 500446 Carol Info DATABASE SOFTWARE TECHNOLOGY PVT. LTD. B 182339 61.35
14/12/2009 500446 Carol Info HARSIDDH SPECIFIC FAMILY TRUST S 200000 61.30
14/12/2009 532184 Ciba India SHARAD KANTILAL SHAH B 95000 340.00
14/12/2009 532184 Ciba India SHARAD KANTILAL SHAH S 93969 340.00
14/12/2009 533144 COX KINGS GENUINE STOCK BROKERS PVT. LTD. B 344638 441.31
14/12/2009 533144 COX KINGS SMART EQUITY BROKERS PRIVATE LIMITED B 456068 444.18
14/12/2009 533144 COX KINGS OPG SECURITIES P LTD B 754007 441.28
14/12/2009 533144 COX KINGS OPG SECURITIES P LTD S 754007 441.51
14/12/2009 533144 COX KINGS GENUINE STOCK BROKERS PVT. LTD. S 344638 441.31
14/12/2009 533144 COX KINGS SMART EQUITY BROKERS PRIVATE LIMITED S 456068 444.43
14/12/2009 526027 Cubex Tubings HEMANT ASHAR S 47855 15.99
14/12/2009 533048 GI ENGINERG KADAM HOLDING LTD S 38425 16.78
14/12/2009 532990 GMR Ferro BP FINTRADE PRIVATE LIMITED B 94203 38.20
14/12/2009 532990 GMR Ferro BP FINTRADE PRIVATE LIMITED S 86202 38.30
14/12/2009 532514 Indraprastha Gas GENESIS INDIAN INVESTMENT COMPANY LIMITED S 1065412 190.00
14/12/2009 507981 Jindal Hotels ABHISHEK VIJAYKUMAR SHAH B 176705 50.35
14/12/2009 507981 Jindal Hotels NARESH CHAND JAIN B 23669 51.78
14/12/2009 507981 Jindal Hotels ABHISHEK VIJAYKUMAR SHAH S 130331 51.39
14/12/2009 507981 Jindal Hotels AJAY GUPTA S 41860 49.10
14/12/2009 507981 Jindal Hotels NARESH CHAND JAIN S 23669 51.27
14/12/2009 530605 Nova Petro REGENT FINANCE CORPORATION PVT. LTD. B 272620 23.37
14/12/2009 530605 Nova Petro REGENT FINANCE CORPORATION PVT. LTD. S 272620 23.24
14/12/2009 531996 Odyssey Corp BHROSEMAND COMMODITIES PVT. LTD. S 53600 20.00
14/12/2009 531496 Omkar Overseas S N INVESTMENT B 25000 41.10
14/12/2009 531496 Omkar Overseas PATHIK NAYANBHAI SHAH B 25000 37.20
14/12/2009 531496 Omkar Overseas HITESH SHASHIKANT JHAVERI B 45002 41.10
14/12/2009 531496 Omkar Overseas FALGUNIBEN MAHAVIRBHAI GOHIL S 53000 37.23
14/12/2009 531496 Omkar Overseas AYODHYAPATI INVESTMENT PVT LTD S 30000 41.10
14/12/2009 531496 Omkar Overseas ARUNKUMAR SOLANKI S 25000 37.88
14/12/2009 531496 Omkar Overseas HITESH SHASHIKANT JHAVERI S 45002 41.10
14/12/2009 531496 Omkar Overseas NISHITH PRAKASH SHAH S 43553 37.22
14/12/2009 512626 Orbit Exports MEDIAMAN MULTIRADE PRIVATE LIMITED B 315000 19.59
14/12/2009 512626 Orbit Exports SUBHKAM VENTURES (I) PRIVATE LIMITED S 168560 19.59
14/12/2009 512626 Orbit Exports FOUNTAIN VANIJYA PVT LTD S 147500 19.59
14/12/2009 511702 Parsharti Inv JAYESHKUMAR CHIMANLAL SONI B 22800 35.92
14/12/2009 511702 Parsharti Inv KRUPA SANJAY SONI S 21084 35.46
14/12/2009 524570 Poddar Pigm PODDAR PIGMENTS LTD BUY BACKX B 90000 35.04
14/12/2009 531855 Prabhav Inds PUSHPA RAMESH SHAH B 55700 32.00
14/12/2009 531855 Prabhav Inds SHREENATHJI FINSTOCK PVT LTD S 85000 32.34
14/12/2009 532387 Pritish Nandy NARESH KUMAR HUF S 96390 34.50
14/12/2009 503873 Priyadarshini Spn PRADEEP KR AGGARWAL S 61040 18.68
14/12/2009 517522 Rajratan Global SANGEETA CHORDIA B 22000 115.50
14/12/2009 517522 Rajratan Global NSB SECURITIES PRIVATE LIMITED S 41250 115.50
14/12/2009 502587 Rama Pulp AARFIN BROKERS PVT. LTD. B 50000 31.40
14/12/2009 502587 Rama Pulp PUNAM AKHIL PATVA B 40841 31.49
14/12/2009 502587 Rama Pulp SUNRISE INVESTMENTS B 47416 31.45
14/12/2009 502587 Rama Pulp DINESH SANGHVI B 110000 31.49
14/12/2009 502587 Rama Pulp MAHIPAT IWDARMAL MEHTA S 50000 31.40
14/12/2009 502587 Rama Pulp SUNRISE INVESTMENTS S 75887 31.45
14/12/2009 502587 Rama Pulp PRABHA FARMS PVT LTD S 163790 31.46
14/12/2009 590077 Ranklin Sol B O REDDY B 36379 56.44
14/12/2009 590077 Ranklin Sol B O REDDY S 28000 55.51
14/12/2009 513558 Real Strips AJAY HAMLAI S 24603 51.12
14/12/2009 511585 Regency Trust POOJA BHARGAVA B 29500 13.65
14/12/2009 511585 Regency Trust ABHINAV BHARGAVA HUF B 30000 13.65
14/12/2009 511585 Regency Trust ABHINAV BHARGAVA B 30000 13.65
14/12/2009 511585 Regency Trust SRINJANI KAJARIA S 87200 13.65
14/12/2009 531952 Riba Textiles KETAN NALINKANT SHAH B 56965 15.55
14/12/2009 531952 Riba Textiles HEMAL KETAN SHAH S 57000 15.55
14/12/2009 521206 Samtex Fashions BIJAL MADHANI HUF B 42245 26.80
14/12/2009 513097 Shivalik Bimet VALLA KATI B 215050 29.06
14/12/2009 513097 Shivalik Bimet TECKNOPOINT MERCANTILE COMPANY PVT LTD B 99094 29.39
14/12/2009 513097 Shivalik Bimet VALLA KATI S 201050 29.21
14/12/2009 513097 Shivalik Bimet SAINATH HERBAL CARE MARKETING P.LTD S 244846 28.61
14/12/2009 530883 Super Crop RITABEN BHOGILAL PATEL S 41573 12.23
14/12/2009 530883 Super Crop JYOTSANABEN AMBALAL PATEL S 35872 12.25
14/12/2009 533121 THINKSOFT RAJENDRAKUMAR RATANCHAND OSWAL HUF B 52066 271.96
14/12/2009 533121 THINKSOFT MBL & Co. LTD. B 61096 273.80
14/12/2009 533121 THINKSOFT OPG SECURITIES P LTD B 128602 274.28
14/12/2009 533121 THINKSOFT RAJENDRAKUMAR RATANCHAND OSWAL HUF S 52066 279.56
14/12/2009 533121 THINKSOFT MBL & Co. LTD. S 61096 273.23
14/12/2009 533121 THINKSOFT OPG SECURITIES P LTD S 128602 274.36
14/12/2009 531404 Zicom Elect TRANSGLOBAL SECURITIES LTD. B 138268 114.05
14/12/2009 531404 Zicom Elect OPG SECURITIES P LTD B 177646 114.46
14/12/2009 531404 Zicom Elect MANSUKH SECURITIES & FINANCE LTD B 86657 112.98
14/12/2009 531404 Zicom Elect TRANSGLOBAL SECURITIES LTD. S 136269 114.14
14/12/2009 531404 Zicom Elect OPG SECURITIES P LTD S 177646 114.52
14/12/2009 531404 Zicom Elect MANSUKH SECURITIES & FINANCE LTD S 86197 112.90
NSE Bulk Deals to Watch - Dec 14 2009
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
14-DEC-2009,AUSTRAL,Austral Coke & Projects L,ARIHANT SEC & INVESTMENT,BUY,1674073,8.46,-
14-DEC-2009,COX&KINGS,Cox & Kings (I) Ltd,GENUINE STOCK BROKERS PVT LTD,BUY,361301,443.14,-
14-DEC-2009,COX&KINGS,Cox & Kings (I) Ltd,KALASH SHARES & SECURITIES PRIVATE LIMITED,BUY,345850,442.57,-
14-DEC-2009,FCSSOFT,FCS Software Solutions Li,TRANSGLOBAL SECURITIES LTD.,BUY,808183,16.06,-
14-DEC-2009,FCSSOFT,FCS Software Solutions Li,V. P. CONSULTANTS PRIVATE LIMITED,BUY,1004696,15.99,-
14-DEC-2009,GMRFER,GMR Ferro Alloys & Indust,AJAY ASSET MANAGEMENT PRIVATE LIMITED,BUY,66361,38.73,-
14-DEC-2009,GMRFER,GMR Ferro Alloys & Indust,BHAVIN Y MEHTA,BUY,68468,38.44,-
14-DEC-2009,GMRFER,GMR Ferro Alloys & Indust,BP FINTRADE PRIVATE LIMITED,BUY,79226,38.25,-
14-DEC-2009,GMRFER,GMR Ferro Alloys & Indust,VIJIT SHARES AND COMMODITIES PVT.LTD.,BUY,72280,38.83,-
14-DEC-2009,MANGLMCEM,Mangalam Cement Ltd,BIRLA SUN LIFE INSURANCE COMPANY LIMITED,BUY,500000,131.00,-
14-DEC-2009,NOVA,Nova Petrochem Ltd,REGENT FINANCE CORPORATION PVT. LTD.,BUY,256913,21.43,-
14-DEC-2009,PNC,Pritish Nandy Comm. Ltd.,NARESH KUMAR HUF,BUY,75989,35.75,-
14-DEC-2009,SASKEN,Sasken Commu Techno Ltd,ASIT C MEHTA INVESTMENT INTERRMEDIATES LTD.,BUY,175364,176.66,-
14-DEC-2009,THINKSOFT,Thinksoft Global Ser Ltd,MBL & COMPANY LTD.,BUY,96141,271.55,-
14-DEC-2009,THINKSOFT,Thinksoft Global Ser Ltd,RAJENDRAKUMAR RATANCHAND OSWAL HUF,BUY,138238,273.27,-
14-DEC-2009,THINKSOFT,Thinksoft Global Ser Ltd,REGENT FINANCE CORPORATION PVT. LTD.,BUY,75588,266.77,-
14-DEC-2009,ZICOM,Zicom Electronic Security,ASIT C MEHTA INVESTMENT INTERRMEDIATES LTD.,BUY,81102,111.58,-
14-DEC-2009,ZICOM,Zicom Electronic Security,BP FINTRADE PRIVATE LIMITED,BUY,65028,113.28,-
14-DEC-2009,ZICOM,Zicom Electronic Security,MANSUKH SECURITIES & FINANCE LIMITED,BUY,107738,113.27,-
14-DEC-2009,ZICOM,Zicom Electronic Security,TRANSGLOBAL SECURITIES LTD.,BUY,123179,114.04,-
14-DEC-2009,AUSTRAL,Austral Coke & Projects L,ARIHANT SEC & INVESTMENT,SELL,2117073,8.47,-
14-DEC-2009,COX&KINGS,Cox & Kings (I) Ltd,GENUINE STOCK BROKERS PVT LTD,SELL,361301,443.34,-
14-DEC-2009,COX&KINGS,Cox & Kings (I) Ltd,KALASH SHARES & SECURITIES PRIVATE LIMITED,SELL,345850,443.00,-
14-DEC-2009,FCSSOFT,FCS Software Solutions Li,TRANSGLOBAL SECURITIES LTD.,SELL,809854,16.06,-
14-DEC-2009,FCSSOFT,FCS Software Solutions Li,V. P. CONSULTANTS PRIVATE LIMITED,SELL,1004696,16.02,-
14-DEC-2009,FIEMIND,Fiem Industries Limited,CHAROEN SACHAMUNEEWONGSE,SELL,85225,107.09,-
14-DEC-2009,GMRFER,GMR Ferro Alloys & Indust,AJAY ASSET MANAGEMENT PRIVATE LIMITED,SELL,63870,38.81,-
14-DEC-2009,GMRFER,GMR Ferro Alloys & Indust,BHAVIN Y MEHTA,SELL,68469,38.58,-
14-DEC-2009,GMRFER,GMR Ferro Alloys & Indust,BP FINTRADE PRIVATE LIMITED,SELL,74250,38.12,-
14-DEC-2009,GMRFER,GMR Ferro Alloys & Indust,VIJIT SHARES AND COMMODITIES PVT.LTD.,SELL,72280,38.68,-
14-DEC-2009,MANGLMCEM,Mangalam Cement Ltd,CAPITAL GROUP -A/C SMALL CAP WORLD FND INC,SELL,499471,131.02,-
14-DEC-2009,MANGLMCEM,Mangalam Cement Ltd,CAPITAL GROUP-A/C AMERICAN FUNDS INSURANCE SERIES GLOBAL SMA,SELL,438374,131.02,-
14-DEC-2009,NOVA,Nova Petrochem Ltd,MILLENNIUM INFOSOFT PVT LTD,SELL,400000,21.01,-
14-DEC-2009,NOVA,Nova Petrochem Ltd,REGENT FINANCE CORPORATION PVT. LTD.,SELL,256913,21.64,-
14-DEC-2009,PNC,Pritish Nandy Comm. Ltd.,NARESH KUMAR HUF,SELL,137106,34.59,-
14-DEC-2009,SASKEN,Sasken Commu Techno Ltd,ASIT C MEHTA INVESTMENT INTERRMEDIATES LTD.,SELL,175364,176.08,-
14-DEC-2009,THINKSOFT,Thinksoft Global Ser Ltd,MBL & COMPANY LTD.,SELL,96141,272.05,-
14-DEC-2009,THINKSOFT,Thinksoft Global Ser Ltd,RAJENDRAKUMAR RATANCHAND OSWAL HUF,SELL,138238,279.11,-
14-DEC-2009,THINKSOFT,Thinksoft Global Ser Ltd,REGENT FINANCE CORPORATION PVT. LTD.,SELL,75588,276.99,-
14-DEC-2009,ZICOM,Zicom Electronic Security,ASIT C MEHTA INVESTMENT INTERRMEDIATES LTD.,SELL,81102,111.43,-
14-DEC-2009,ZICOM,Zicom Electronic Security,BP FINTRADE PRIVATE LIMITED,SELL,61028,113.40,-
14-DEC-2009,ZICOM,Zicom Electronic Security,MANSUKH SECURITIES & FINANCE LIMITED,SELL,100738,113.28,-
14-DEC-2009,ZICOM,Zicom Electronic Security,TRANSGLOBAL SECURITIES LTD.,SELL,123179,114.15,-
Post Market Commentary - Dec 14 2009
Today's major news
Reliance Infrastructure bags Rs1,000 crore Kandla-Mundra project: the stock closed the day 0.76% lower.
Jaihind Projects bags order worth Rs24.53 crore; the stock rises by 0.58% for the day.
Bharat Heavy Electricals Ltd (BHEL) talking to Larsen & Toubro, Pipavav to revive offshore rig business; BHEL jumps 1.94% for the day.
HSIL eyes tile business; the stock ends 0.34% lower.
ACC inaugurates its new cement plant at Thondebhavi in Karnataka; the stock surged 5.33%.
Click here for more stories
Post-market summary
Global signals
European stocks extended their gains for the third consecutive day, as Dubai debt fear eased, with the banking stocks witnessing maximum gains. FTSE 100 is trading 0.89% higher at the time of writing this report.
Asian indices that opened in red trimmed the morning losses, as fears of a potential debt default by Dubai that had rattled the global markets eased. SGX Nifty closed three points lower.
US stock futures also traded higher as fears of debt default by Dubai faded.
Indian indices
Taking leads from Asian markets, the Indian stock market opened in red but turned positive on news that the Abu Dhabi government has agreed to give $10 billion as emergency funds to Dubai that will go towards paying the debts owed by Dubai World conglomerate.
However, at noon, the sentiment turned negative leading the Sensex to trim its morning gains. Whipsawing 227 points the bellwether’s day high was 17275 and the low was 17048. The index closed 0.13% or 21 points lower while Nifty closed 12 points down.
Sensex sentiment
Of the 2,901 stocks traded on the BSE, 1,670 stocks declined, whereas 1,167 stocks advanced. Sixty four stocks closed unchanged.
Sectoral & stock screening
Information technology (IT) scrips drew investor interest with the BSE IT topping the chart with gains of 1.16% to be followed capital goods stocks (BSE CG up by 0.95%). Fast moving consumer goods, consumer durables and banking stocks were least favoured with the BSE FMCG at the bottom of chart with losses of 1.43% to be followed by BSE CD that declined by 1.18%. The BSE Bankex was down by 1.13%
On stocks’ front, MMTC surged the most by 5.85% followed by ACC that rose by 5.33%. Gujarat NRE Coke, UltraTech Cement and Ranbaxy Laboratories ended the day with gains of over 4% each. Among losers, Oriental Bank of Commerce slid the most by 5.46%, followed by IVRCL Infrastructure that fell by 4.44% and Shriram Transport that shed 3.95%.
Viewing volumes
Realty major Unitech was the most traded share with over 0.73 crore shares changing hands on the BSE to be followed by Suzlon Energy (0.63 crore shares), IFCI (0.61 crore shares), GVK Power & Infrastructures (0.41 crore shares) and Ispat Industries (0.35 crore shares).
Cement stocks defy weak market
A surge in headline inflation pulled the market lower with bank shares leading the slide. The BSE Sensex fell 21.48 points or 0.13% off close to 175 points from the day's high and up close to 50 points from the day's low. Index heavyweight Reliance Industries reversed gains. Metal and FMCG stocks fell. But, cement and IT stocks rose. The market breadth was weak in contrast to a strong breadth in early trade.
The market edged lower in early trade tracking weak regional stocks. It soon rebounded after Dubai said it had received $10 billion from Abu Dhabi to help it repay $4.1 billion in an Islamic bond maturing on Monday, 14 December 2009. The market pared gains after hitting fresh intraday high in mid-morning trade. The market surged again in afternoon trade. A sell-off in mid-afternoon trade pulled the market into the red. The market moved between positive and negative zone later.
India VIX, a volatility index based on the S&P CNX Nifty index option prices, rose 2.73% to 27.89. India VIX is a measure of the market's expectation of volatility over the next 30 calendar days
The latest data from global fund tracker EPFR Global showed emerging market equity funds received $2.3 billion in inflows in the week ended 9 December 2009, bringing 2009 inflows to $75.4 billion. Emerging-market funds are heading for record annual inflows in 2009. The previous record was $54 billion in 2007.
Asia excluding Japan and global emerging market stock funds each attracted net inflows of more than $800 million for the week. Among the largest developing nations, Russian stocks funds saw inflows rise to a seven-week high of $181 million while Indian equity funds absorbed $128 million, EPFR said.
Dubai said on Monday it had received $10 billion from fellow UAE member Abu Dhabi to help it repay $4.1 billion Islamic bond maturing on Monday. The statement said the excess would be used to cater to Dubai Worlds needs up until the end of April 2010. "We are here today to reassure investors, financial and trade creditors, employees, and our citizens that our government will act at all times in accordance with market principles and internationally accepted business practices," Sheikh Ahmed bin Saaed al-Maktoum said in a statement.
"Dubai is, and will continue to be, a strong and vibrant global financial center. Our best days are yet to come.", he said. Abu Dhabi is the largest member of the United Arab Emirates federation and a major oil exporter. The statement also said that the United Arab Emirates Central Bank, which governs monetary policy in Dubai, Abu Dhabi and other UAE constituents, "is also prepared to provide support to local UAE banks."
Dubai's conglomerate Dubai World roiled global markets in late November 2009 when it said that it wanted to suspend debt payments for six months.
Closer home, inflation based on the wholesale price index (WPI) surged 4.78%, data released by the government showed at 12:00 IST on BSE. That was much higher than previous month's annual rise of 1.34%. The food article index within the wholesale price index rose 16.71% in November 2009. The manufacturing products index in the WPI rose an annual 3.99%. In its October policy review, the Reserve Bank raised its WPI inflation projection for end-March 2010 to 6.5% with an upside bias from 5% earlier.
The government is concerned about rising inflation, but there is no need for any emergency action at this stage, finance secretary Ashok Chawla said on Monday. Chawla said the inflation numbers were within the range set by the central bank and the government
The rise in the wholesale price index during November 2009 is mainly due to higher food prices, Finance Minister Pranab Mukherjee said today.
Trade Minister Anand Sharma said on Monday rising wholesale prices are a matter of concern and the government is monitoring prices of essential commodities.
A finance ministry official said on Friday 11 December 2009 the government was taking steps to moderate the rise in food prices, a day after data showed the food price index which is released weekly, jumped an annual 19.05% as at 28 November 2009.
The Reserve Bank of India has said it needs to strike a balance between growth and inflation, but has also noted most inflation pressures are coming from food supply shortages, where monetary policy is not an effective tool. Governor D Subbarao has said the danger was that food price inflation, running at an annual 19.05% at end-November, spills over into broader inflation expectations.
Industrial output jumped 10.3% in October 2009 from a year earlier, helped by stimulus measures and robust domestic demand, data released by the government on Friday showed. Manufacturing production rose 11.1% in October 2009 from a decline of 0.6% a year earlier. September's annual industrial growth rate was revised upward to 9.6% from 9.1% previously. Industrial output rose 2.6% in the 2008/09 fiscal year (April-March), slower than 8.5% in 2007/08.
Investors fear that a recovery in the economy and a surge in wholesale price inflation will add pressure on the central bank to tighten monetary policy. The Reserve Bank of India holds a quarterly policy review in late January 2010.
The Goods and Services Tax (GST) regime would have four slabs and it is likely to be unveiled within 15 days, chairman of empowered committee of state finance ministers Asim Dasgupta said on Sunday, 13 December 2009. GST slabs would include exempted items list, one standard rate for majority of the goods and services and another having a moderate rate, he said.
The implementation of GST is scheduled for 1 April 2010. However, there are doubts at various quarters whether the new tax regime would come into effect at the targetted date because of differences of opinion over the rates among states and the items to be included under GST. The Empowered Committee of state finance ministers had released a discussion paper on GST on 10 November 2009. It proposes to replace central levies like excise duty, service tax, special additional duty, countervailing duty by GST.
State levies like VAT, sales tax, entry tax etc would also be subsumed. Besides all this, central and state cesses and surcharges would be out once GST comes into effect.
Meanwhile, the RBI has reportedly expressed its concerns over many investment companies with low capital base raising disproportionately high funds. As per the current norms, corporate investment firms, which hold strategic stakes of group companies, are exempt from following the stringent norms similar to NBFCs. RBI may impose regulatory restrictions on such investment arms having high leverage as a measure to limit the aggressive borrowing by corporates. Currently, RBI is reported to be in discussion stage with some corporate groups on the issue.
The disinvestment programme is reportedly set to enter an ambitious phase in the next financial year with the Department of Disinvestment planning to seek Cabinet approval for a host of companies from January 2010. The Cabinet has so far followed a cautious approach in approving disinvestment in companies, though it has simultaneously come out with a broad policy direction for the programme. Based on the policy, the disinvestment department has prepared a list of up to 30 companies that can be considered for disinvestment
Stocks-specific activity will hog the limelight on Tuesday, 15 December 2009, with investors reacting to corporate advance tax payments data. The last date for payment of the third instalment of advance tax is Tuesday, 15 December 2009. Advance tax is paid in four installments in June, September, December and March, and is based on taxpayers' projected income, giving an indication of industry's performance in coming months.
Corporate advance tax payments grew by 14.7% in the second quarter, after declining by 3.7% in June. With the economy showing clear signs of recovery, the government is hopeful advance tax payments will help it meet the shortfall in direct tax collections. Direct tax collections stood at Rs 1,83,822 crore in April-November 2009.
Meanwhile, the initial public offer of DB Corp, India's second largest regional newspaper, was subscribed 2.17 times by 16:00 IST on Monday, 14 December 2009. The company has set a price band of Rs 185-212 a share.
European shares rose on Monday, extending their wining streak to three-sessions, as Dubai debt fears eased, with banks the major gainers. The key benchmark indices in France, Germany and UK rose by between 0.55% to 0.76%.
Most Asian stocks rebounded on Monday after Dubai said it had received $10 billion from Abu Dhabi to repay debt, as risk appetite improved. The key benchmark indices in China, Hong Kong Taiwan, South Korea rose by between 0.31% to 1.71%. But, the key benchmark indices in Singapore, Japan and Indonesia were down by between 0.02% to 0.5%.
Trading in US index futures indicated the Dow could jump 35 points at the opening bell on Monday, 14 December 2009.
The Dow and S&P 500 rose on Friday 11 December 2009 after stronger-than-expected retail sales and consumer sentiment data reinforced investor confidence in a steady economic recovery. The Dow Jones industrial average rose 65.67 points, or 0.63%, to 10471.5. The Standard & Poor's 500 Index added 4.06 points, or 0.37%, to 1106.41. The Nasdaq Composite Index down 0.55 points, or 0.03%, to 2190.31.
Senior White House economists on Sunday predicted the US economy will start creating jobs by spring and said that boosting employment will be at the top of President Barack Obama's agenda next year.
A key event this week is a regular two-day meeting of the US Federal Reserve Meeting which begins on Tuesday, 15 December 2009. The Fed is expected to maintain its pledge to keep US interest rates close to zero for "an extended period" after Chairman Ben Bernanke warned that US economic recovery still faced "formidable headwinds", such as tight credit conditions and rising unemployment. Bernanke's re-appointment as chairman of the Federal Reserve by the Senate banking committee is expected on Thursday.
Investors, meanwhile, are increasingly wondering when Bernanke will signal any changes to the exceptionally loose US monetary policies and liquidity conditions that have propelled asset markets higher this year. US industrial production during November, the figures for which are due on Tuesday, is expected to rise 0.5%. This would slow the year-on-year decline from minus 7.1% in October to minus 5.4%.
US producer prices are expected to show the headline measure returning to positive territory for the first time in a year, with the year-on-year rate rising from minus 1.9% in October to a rise of 1.6%. US consumer price inflation is also likely to move into positive territory for the first time since February 2009, with the headline measure expected to rise from minus 0.2% in October to a rise of 1.8%. Core inflation, though, remains low and could sink below 1% next year following a sharp slowdown in labour costs.
The BSE Sensex fell 21.48 points or 0.13% to 17,097.55. The Sensex rose 156.16 points at the day's high of 17275.19 in mid-morning trade. The Sensex fell 70.86 points at the day's low of 17048.17 in late trade.
The S&P CNX Nifty fell 11.60 points or 0.23% to 5,105.70. Nifty December 2009 futures were at 5,102.25, at a discount of 3.45 points as compared to the spot closing of 5105.70. Turnover in NSE's futures & options (F&O) jumped to Rs 73,694.26 crore from Rs 71,331.55 crore on Friday, 11 December 2009.
The market breadth, indicating the overall health of the market was weak. On BSE, 1163 shares advanced as compared with 1670 that declined. A total of 66 shares remained unchanged. The breadth was strong in early trade.
Among the 30-member Sensex pack, 13 rose while rest fell.
BSE clocked a turnover of Rs 4110 crore, lower than Rs 5226.42 crore on Friday, 11 December 2009.
A deluge of global liquidity has boosted stocks across the globe this year. Governments and central banks around the world have injected trillions of dollars in the past one year to pull the world out of a most severe recession since the 1930s Great Depression. The Sensex is up 7450.24 points or 77.22% in calendar year 2009, as on 14 December 2009. From a 3-year closing low of 8,160.40 on 9 March 2009, the Sensex is up 8937.15 points or 109.51% as on 14 December 2009.
Coming back to today's trade, the BSE Mid-Cap index fell 0.67% and the BSE Small-cap index fell 0.45% Both the indices underperformed the Sensex.
The sectoral indices on BSE showed a mixed trend. The BSE IT index (up 1.16%), the BSE Capital Goods index (up 0.95%), the BSE Auto index (up 0.78%), the BSE PSU index (up 0.63%), the BSE Power index (up 0.27%), the BSE Healthcare index (up 0.17%), the BSE Teck index (up 0.15%), the BSE Oil & Gas index (up 0.07%), the BSE Realty index (up 0.01%), outperformed the Sensex.
The BSE FMCG index (down 1.43%), the BSE Consumer Durables index (down 1.18%), The BSE Bankex (down 1.13%), the BSE Metal index (down 0.83%), underperformed the Sensex.
India's largest private sector firm by market capitalisation Reliance Industries (RIL) fell 0.24% to Rs 1066.35. The stock came off the day's high of Rs 1083.50. Reliance Industries' (RIL's) attempt to take over the world's third-largest independent chemical company, LyondellBasell Industries, reportedly faces its first hurdle when the beleaguered company's management argues its rescue plan for the company before the special bankruptcy court of New York South District.
Despite getting feelers from RIL for an acquisition and cash-infusion into the company, the LyondellBasell management on Friday 11 December 2009, filed an updated rescue plan centred around a $2.5 billion cash infusion by the company's former owner and two investors. Ratification of the plan would significantly dampen RIL's chances of acquiring the company.
Banking shares fell on a likely monetary tightening by the RBI after a sharp jump in inflation. India's largest private sector bank by net profit ICICI Bank fell 1.49% as its ADR fell 2.66% on Friday, 11 December 2009. ICICI Bank has launched a home-loan scheme under which 8.25% interest rate will be fixed for the first two years. The floating rates will apply after 2 years. These rates will be applicable to loans sanctioned between December 2009 and January 2010.
India's second largest private sector bank by net profit HDFC Bank fell 1.53% as its ADR fell 2.63% on Friday.
India's largest bank by net profit and branch network State Bank of India fell 0.77%. The UPA government recently cleared the introduction of State Bank of India (Amendment) Bill in the current session of Parliament. The Bill seeks to bring the government's holding in the country's largest public sector bank on a par with other public sector banks at 51 %. Currently, the Union government holds 59% stake in SBI. At present, the stake of the promoter, that is Government of India, cannot fall below 55 %.
India's largest mortgage lender by total income Housing Development Finance Corporation (HDFC) fell 0.38%, extending recent losses triggered by investor worry a dual interest rate scheme on home loans introduced by the company would hit margins.
HDFC recently announced a dual-rate loan scheme under which a borrower will be charged a fixed rate up to March 2012 and a floating rate thereafter. For a 20-year loan of Rs 30 lakh, a borrower will pay a fixed rate of 8.25% up to March 2012 and then a floating rate that's 500 basis points below the prime lending rate (PLR) - the institution's benchmark rate. Currently, the PLR is 13.75%.
Metal stocks reversed early gains on profit taking. Hindalco Industries fell 1.2%. Hindalco Industries is reportedly raising Rs 4500 crore ($966 million) in debt to fund a new alumina refinery. The 1.5-million-tonne per year refinery, in the eastern state of Orissa, is expected to start production in July 2011 and involves about Rs 6500 crore as capital expenditure.
Hindustan Zinc, National Aluminum Company, Sterlite Industries fell by between 0.05% to 0.91%.
Tata Steel, the world's eighth-largest steelmaker by sales, fell 0.17% in choppy trade on reports the company is in talks with investors to raise Rs 5000 crore ($1.1 billion) in equity and an equal amount in debt. The company said on 7 December 2009 its sales rose 34.5% to 498,000 tonnes, in November 2009 over November 2008.
FMCG shares fell on profit taking. ITC, Hindustan Unilever, Dabur India, Tata Tea, United Spirits fell by between 0.24% to 2.86%.
IT stocks rose after stronger-than-expected retail sales and consumer sentiment data in the US reinforced investor confidence in a steady economic recovery. US is the biggest market for Indian IT companies. India's second largest software services exporter Infosys Technologies rose 1.76% even as its ADR fell 0.25% on Friday, 11 December 2009. India's largest software services exporter TCS rose 0.18%. India's third largest software services exporter Wirpo rose 2.23% even as its ADR fell 1.48% on Friday.
Capital goods stocks rose on hopes of strong order flow. India's largest engineering and construction firm by sales Larsen & Toubro rose 0.85%. The company said on Tuesday 8 December 2009 that it got orders worth Rs 844 crore.
Among other capital goods stocks, Bharat Heavy Electricals, BEML, SKF India and ABB rose by between 0.19% to 6.88%.
Auto stocks rose on strong sales on the month of November 2009. India's largest small car maker by sales Maruti Suzuki India rose 1.06%. Germany's Volkswagen and Suzuki Motor, Maruti Suzuki 's parent, reportedly plan to develop a new small car for the Indian market. Japan's Suzuki Motor said on Wednesday 9 December 2009 it will sell a 19.9% stake to Volkswagen (VW) for $2.5 billion and use half the proceeds to buy shares in the German automaker, as the two firms form a formidable force in the auto industry. Japan's Suzuki has a 54.2% stake in Maruti Suzuki India
Suzuki's chief told the media recently that the company will cooperate with VW in India by sharing common components. VW's chief Winterkorn said the firm will pursue synergies in India between Suzuki, Volkswagen, Skoda brands.
Maruti's total vehicle sales spurted 66.60% to 87,807 units in November 2009 over November 2008. Domestic sales spurted 60.10% to 76,359 units, while exports surged 128.60% to 11,448 units in November 2009 over November 2008.
India's largest motorcycle maker by sales Hero Honda Motors rose 0.88%. The company's total vehicle sales jumped 32% to 3.81 lakh units in November 2009 over November 2008.
India's top tractor marker by sales Mahindra & Mahindra (M&M) rose 0.71%. Mahindra & Mahindra will reportedly launch its first truck under a joint venture (JV) with Navistar, North America's largest commercial truckmaker, next month. The company's domestic auto sales soared 105.1% to 21,387 units in November 2009 over November 2008. M&M sold a total of 22,587 vehicles (domestic plus exports) in November 2009 as against 11,515 vehicles sold in November 2008.
India's second largest bike maker by sales Bajaj Auto rose 3.47% after a leading foreign broker raised its rating on the stock to 'buy' from 'neutral', saying that demand for two-wheelers is growing. Bajaj Auto will reportedly stop producing scooters by March 2010 to focus on motorcycles.
Bajaj Auto on Wednesday 9 December 2009 launched a 135 cc Pulsar, pushing the Pulsar brand into the mass segment. Bajaj expects a sell a minimum 30,000 units per month of the new Pulsar model. The automaker had recently refreshed the entire Pulsar lineup and expects total Pulsar sales to cross 80,000 units per month.
The company's total vehicle sales rose 73% to 2.76 lakh units in November 2009 over November 2008. Motorcycles sales jumped 84% to 2.42 lakh units.
But, India's top truck maker by sales Tata Motors fell 0.1%. As per recent reports the company is negotiating to acquire Japanese conglomerate Sumitomo's 53.5% stake in the Punjab-based auto firm Swaraj Mazda in a deal worth up to $54 million. Tata Motors' total sales zoomed 65.49% to 54,108 units in November 2009 over November 2008.
Car sales in India rose an annual 61% to 1,33,687 in November 2009 over November 2008, boosted by improved consumer sentiment, easier availability of loans and a low sales base a year earlier, an industry body said on Tuesday. Sales of trucks and buses, a gauge of economic activity, doubled to 40,847 units in November from 20,631 a year earlier, data from the Society of Indian Automobile Manufacturers showed.
Telecom stocks fell on profit taking. Telecom minister A Raja said on Friday 11 December 2009 there is no change in 3G auction schedule. Meanwhile, the central bank, last week, allowed telecom firms to access oversees markets to fund their bids for 3G spectrum. India's largest mobile services provider by sales Bharti Airtel fell 3.47%. Bharti Airtel sees revenue pressured in the short term amid an intense price war in the country's wireless sector, director Akhil Gupta said on 7 December 2009.
India's second largest mobile services provider by sales Reliance Communications fell 1.33%. The company has reportedly won mgovernance contracts worth over Rs 500 crore. The government may impose a penalty on Reliance Communications after examining a state audit report that found the No. 2 telecoms firm under-reported revenue for two years, the telecoms minister A Raja said on Thursday.
Mobile operators including Bharti Airtel, Vodafone Essar and Reliance Communications are locked in a tariff war, raising concerns about telecom firms' profitability. The price war is aimed at grabbing new users as new firms enter the market.
India's largest thermal power generator by sales NTPC fell 0.53% The government is planning a 5% stake sale in the firm by March 2010. Among other power stocks, Reliance Infrastructure, Reliance Power, Toreent Power fell by between 0.52% to 0.76%.
Cement shares rose on expectations of a price hike. ACC, Ambuja Cements, Ultratech Cement and Birla Corporation rose by between 2.21% to 5.33%.
Cement prices are reportedly seen hardening in the January-March 2010 quarter as demand from state projects picks up and rural housing drives volume growth. Prices went up by Rs 8-10 for a 50 kg bag southern India late November to Rs 155-175, while a similar hike in Mumbai on 2 December 2009 raised prices to Rs 240-245 per bag.
Realty stocks fell on profit taking. India's largest realty player by market capitalization DLF was flat. DLF is reportedly set to acquire DLF Asset (DAL), a property trust owned by its promoters KP Singh and family, for around Rs 10,000 crore, as the country's largest real estate firm looks to consolidate its commercial assets under one company.
Among other realty stocks, Indiabulls Real Estate, Akruti City and Unitech fell by between 0.09% to 2.02%.
Oil exploration firms were mixed after US crude oil futures fell on Friday, hitting a two-month low, as the market slumped for the eighth straight day led by a stronger dollar. On the New York Mercantile Exchange January crude was down 68 cents, or 0.96 %, at $69.86 a barrel. Cairn India fell 0.5%. India's second biggest oil and gas exploration firm by revenue, Oil India, fell 0.11%. But, India's biggest state-run oil exploration firm by revenue Oil & Natural Gas Corporation (ONGC) rose 1%. Fall in crude oil prices would result in lower realizations from crude sales for oil exploration firms.
Cals Refineries clocked the highest volume of 1.11 crore shares on BSE. Radhe Developers (0.86 crore shares), Unitech (0.73 crore shares), Anu's Lab (0.72 crore shares) and Cox & Kings (0.71 crore shares) were the other volume toppers in that order.
Cox & Kings clocked highest turnover of Rs 302.14 crore on BSE. Tata Steel (Rs 116 crore), State Bank of India (Rs 112.33 crore), Housising Development & Infrastructure (Rs 101.23 crore) and Reliance Industries (Rs 76.90 crore) were the other turnover toppers in that order.
DB Corp, Godrej Properties Grey Market Premium
| Company Name | Offer Price (Rs.) | Premium (Rs.) |
| MBL Infra | 165 to 180 | 6 to 7 |
| JSW Energy Ltd. | 95 to 110 | -5 to -7 (Discount) |
| Godrej Properties | 490 | 7 to 9 |
| D. B. Corp. | 185 to 212 | 6to 8 |
Market may fall on weak Asia; inflation data eyed
The market may open lower tracking weak Asian stocks. Investors will keenly watch the inflation data for the month of November 2009 due to be announced by the government today. The annual rate of inflation, based on monthly wholesale price index (WPI), stood at 1.34 % for the month of October 2009 over October 2008.
A finance ministry official said on Friday 11 December 2009 the government was taking steps to moderate the rise in food prices, a day after data showed the food price index whish is released weekly jumped an annual 19.05 % on 28 November 2009.
The Reserve Bank of India has said it needs to strike a balance between growth and inflation, but has also noted most inflation pressures are coming from food supply shortages, where monetary policy is not an effective tool. Governor Duvvuri Subbarao has said the danger was that food price inflation , running at an annual 19.05 % at end-November, spilt over into broader inflation expectations.
Industrial output jumped 10.3% in October 2009 from a year earlier, helped by stimulus measures and robust domestic demand, data released by the government on Friday showed. Manufacturing production rose 11.1% in October 2009 from a decline of 0.6% a year earlier. September's annual industrial growth rate was revised upward to 9.6% from 9.1% previously. Industrial output rose 2.6% in the 2008/09 fiscal year (April-March), slower than 8.5% in 2007/08.
Investors fear that a recovery in the economy and a likely surge in wholesale price inflation will add pressure on the central bank to raise interest rates. The Reserve Bank of India holds a quarterly policy review in late January 2010.
Indian corporates that have borrowed aggressively through investment arms and holding firms to fuel growth will soon run into a speed breaker. The Reserve Bank of India, reportedly will come out with a new rule for such investment companies that are largely outside the regulator's radar. The central bank's concern stems from the disproportionately high fund-raising by these companies with shallow capital base.
The disinvestment programme is reportedly set to enter an ambitious phase in the next financial year with the Department of Disinvestment planning to seek Cabinet approval for a host of companies from January 2010. The Cabinet has so far followed a cautious approach in approving disinvestment in companies, though it has simultaneously come out with a broad policy direction for the programme. Based on the policy, the disinvestment department has prepared a list of up to 30 companies that can be considered for disinvestment
Meanwhile, DB Corp, India's second largest regional newspaper, was subscribed 2.02 times on the first day of issue on Friday 11 December 2009. The company has set a price band of Rs 185-212 a share.
Mumbai based realty firm Godrej Properties' initial public offering (IPO) was subscribed 4 times on last day of the issue on 11 December 2009. The price band is at Rs 490-530 per share.
Asian stocks fell on Monday led by banks and commodity producers, as a measure of Japanese business confidence showed companies are scaling back their investment plans and oil prices dropped. The key benchmark indices in China, Hong Kong, Japan, Indonesia, South Korea, Singapore and Taiwan fell by between 0.11% to 2.08%.
The Dow and S&P 500 rose on Friday 11 December 2009 after stronger-than-expected retail sales and consumer sentiment data reinforced investor confidence in a steady economic recovery. The Dow Jones industrial average rose 65.67 points, or 0.63%, to 10471.5. The Standard & Poor's 500 Index added 4.06 points, or 0.37%, to 1106.41. The Nasdaq Composite Index down 0.55 points, or 0.03%, to 2190.31.
Senior White House economists on Sunday predicted the U.S. economy will start creating jobs by spring and said that boosting employment will be at the top of President Barack Obama's agenda next year.
Back home, the key benchmark indices ended a choppy trading session lower on Friday 11 December 2009 as industrial production growth for October 2009 only matched estimates while market participants had hoped for a big surprise. The BSE Sensex fell 70.28 points or 0.41% to 17,119.03 on that day.
As per provisional figures on NSE, the foreign funds bought shares worth Rs 338.46 crore and domestic funds sold shares worth Rs 7.17 crore on Friday, 11 December 2009.
Daily News Roundup - Dec 14 2009
Vodafone Group plans to offload its 4.39% indirect holding in Bharti Airtel. (ET)
ONGC has sought levy of windfall tax on any crude oil price of over US$60 per barrel to pay for fuel subsidies. (BS)
BHEL is in talks with L&T and Pipavav Shipyard to jointly build off-shore oil rigs. (BS)
Reliance Infra bags Rs10bn Kandla-Mundra road project in Gujarat. (BS)
Government has initiated the process of divesting a further 8.4% stake in NMDC through a fresh public offering. (BL)
Tata Steel is in talks with international investors to raise at least Rs50bn through equity and an equivalent amount through debt. (DNA)
ONGC lost a bid to acquire a large oilfield in Iraq to a consortium of Chinese, Malaysian and French energy firms. (ET)
Taro Pharmaceutical asked its shareholders to reject a takeover bid by Sun Pharmaceuticals ahead of its AGM on December 31. (ET)
ACC plans to review its decision of scaling down the company's ready-mix concrete business and recommence the expansion plan by the middle of 2010. (BS)
GAIL (India) is looking at the D6 block and re-gasified LNG as probable sources of gas for its ongoing Dabhol-Bengaluru and Kochi-Kanjirkkod-Bengaluru-Mangalore pipeline projects (BL)
Tata Power to commission first unit of Dagachhu in 2013. (BS)
DLF is set to merge the real estate investment trust DLF Assets into itself. (FE)
SAIL and Tata Steel have submitted to the government a joint proposal asking to be allocated Coal India long-neglected coking coal mines. (DNA)
DLF, which was in talks with Brussels-based GDF Suez Energy International and Akuo Energy International for selling its wind mill business, is set to seal the deal by the month-end. (DNA)
Aditya Birla Group to hive off financial services business. (FE)
Procter & Gamble agreed to buy Sara Lee’s air-care brands, including Ambi Pur, for about US$700m. (ET)
Apollo Tyres plans to increase tyre prices by up to 10% by this month end. (ET)
Parsvnath Developers has raised Rs750mn by selling 50% stake in a housing project to US-based PE firm Sun Apollo. (ET)
Jindal Power plans to invest Rs650bn in new power projects and part of the financing for these would be done through its up to Rs100bn IPO. (ET)
The Tiruchi unit of BHEL plans to consider four-five companies as candidates for acquisition. (BS)
Power Finance Corporation plans to raise US$300mn through external commercial borrowings. (ET)
Shree Renuka Sugars in preliminary talks to acquire Balrampur Chini. (ET)
Gujarat Power Corporation Ltd inks pact with Torrent Power to develop a 1000MW coal-based power plant at Pipavav in Amreli district of Saurashtra region. (BS)
PNB plans to open 100,000 biometric ATMs by 2013. (BS)
JK Lakshmi Cement plans to set up a cement factory at Jharli in Jhajjar district of Haryana. (BS)
Vodafone Group plans to list its Indian arm and was open to acquisitions when opportunities are available in the country. (BS)
VW-Suzuki plans to carry out hybrid car R&D in India. (FE)
PTC to acquire coal assets abroad. (FE)
ONGC plans to raise US$1bn to service Imperial loan. (BS)
GlaxoSmithKline Consumer it temporarily suspended operations at its factory in the industrial estate of Dowlaiswaram in Andhra Pradesh, due to political unrest. (BS)
Merck Inc said it had no immediate plans to delist its newly-acquired subsidiary, Fulford India. (BS)
BSNL today became the first company in the country to start wireless broadband services and announced a tariff starting with Rs140 per month for rural areas. (DNA)
The government plans to work out a new subsidy formula to replace the current system of compensating the oil marketing companies for selling below cost through issue of oil bonds. (ET)
India’s Industrial output expanded by 10.3% in the month of October from a year ago. (ET)
Import duty on equipments halved to 2.5% for mega power projects. (BS)
Foreign exchange reserves rose by US$651mn to US$287bn, for the week ended December 4. (BL)
Centre may allow private developers to use surplus land in housing projects under the Rajiv Awas Yojana for commercial activity, according to the Union Minister of State for Urban Development. (BL)
Government says there is no proposal to tax capital inflows in to the stock markets. (BL)
PSU oil marketing companies are projected to incur under recoveries of Rs455bn on the four petroleum products in 2009-10 based on the refinery gate prices of the first fortnight of December. (BL)
Goods and services tax under the new tax regime, would have four slabs and these are likely to be unveiled within 15 days, says Chairman of empowered committee of state finance ministers. (BL)
The government may delay its plans to introduce a uniform licence fee for mobile phone operators. (ET)
Starting problem
If a problem has no solution, it may not be a problem, but a fact - not to be solved, but to be coped with over time.
There is no immediate solution in sight to the lack of clear direction in the market. The fact is we will remain at the mercy of global cues and foreign money. Any domestic booster is usually intra-day in nature like the Friday's reversal post the IIP report. Don’t press the panic button in case of any fresh bad news. Stay alert and stick to a stock centric approach. This week’s trend will hinge on what the Fed says at the end of its policy meeting on Wednesday. Till then, we expect the key indices to remain sideways. The Nifty will continue to trade in a 5000-5200 range. It remains to be seen whether the Nifty manages to decisively close above 5180 in the remaining days of the year.
There will surely be few more speed bumps ahead in some form or the other. The recovery in several parts of the world will be a ‘stop-and-go’ affair, especially in the developed world. It is taking different shapes across the globe, with emerging economies such as China and India better placed. Even within the industrialized world and developing markets, the recovery trend is a mixed one. The crucial event to watch will be the Fed’s ‘exit’ strategy. This will then decide the fate of the dollar, whose weakness has been driving up the risk appetite. How various governments execute their ‘exit’ plans and its fallout on their respective economies is another matter of concern.
What is noteworthy however is that though the market has been stuck in a ‘no-man’s land’ for some time now there hasn’t been a major breakdown in sentiment. Every time there has been a big fall, the key indices have rebounded smartly. The case in point is the Dubai debt fiasco. Even last week, amidst more sovereign debt concerns the market held its nerves. The reaction to the lower than forecast IIP data was exaggerated. So, there is still hope that the bulls will regain their hold unless we are hit by another steroid from the external world. Don't pare your equity exposure substantially. At the same time, wait for some clarity on direction before adding fresh positions. Keep some cash handy as there will be opportunities you can capitalise on in the near term.
Stocks that could be in action today include the likes of Godrej Consumer, DLF, Den Networks, AB Nuvo and PSL.
FIIs were net sellers in the cash segment on Friday at Rs3.38bn on a provisional basis. The local funds were net sellers of Rs71.7mn, according to figures published on the NSE's web site. In the F&O segment, the foreign funds were net buyers at Rs4.83bn.
Coming to Wall Street's trade on Friday, US stocks managed to post moderate gains as better-than-expected reports on retail sales and consumer sentiment lifted big blue chip stocks. But gains were limited by weakness in technology and the strength of the US dollar.
The Dow Jones Industrial Average rose 66 points, or 0.6%, to 10,471.50, finishing at its highest level of 2009. The S&P 500 index gained 4 points, or 0.4%, at 1,106.41. The Nasdaq Composite index ended little changed at 2,190.31. The Dow and the S&P ended the week higher, but the Nasdaq slipped.
Market breadth was positive and volume was light. Trading volume has been light so far this month and trading more volatile as investors close the books early. As of Friday's close, the S&P 500 has gained 64% since closing at a 12-year low on March 9.
The major US stock indexes are bumping up against multi-month highs, with the Dow flirting with a fresh 14-month high, as of Friday afternoon, and the S&P 500 and Nasdaq sitting just below those same levels.
Retail sales climbed 1.3% in November, the Commerce Department reported, easily surpassing analysts' forecasts for a rise of 0.7%. Sales rose 1.1% in October. Sales, excluding autos rose 1.2% after showing no change in October. Economists thought sales would rise 0.4%.
The University of Michigan's consumer sentiment index rose to 73.4 from 67.4, versus forecasts for a rise to 68.8.
United Technologies rose 2.2% a day after it forecast that profits would rise about 10% in 2010.
Alcoa rose as part of a bullish note on the mining sector from JPMorgan Chase.
The dollar gained versus the euro and yen, continuing its recent recovery march after having slid for the better part of the year.
The weak dollar has helped stocks rally over the past nine months, giving a boost to dollar-traded commodity shares and the stocks of companies that do business overseas. But over the last two weeks, the dollar has churned or moved higher.
The stronger US dollar pressured dollar-traded commodity prices, with gold and oil both sliding.
COMEX gold for February delivery fell $6.30 to settle at $1,119.90 an ounce. Gold closed at an all-time high of $1,218.30 an ounce last week.
US light crude oil for January delivery fell 67 cents to settle at $69.87 a barrel on the New York Mercantile Exchange.
On the economic front, recent reports on retail sales, housing and the labor market have added to evidence that the worst US recession since the 1930s is over. That has raised questions about when the Fed may step in to remove some of the emergency stimulus measures it has unleashed to mitigate the impact from the financial meltdown. With the unemployment rate at 10% and just shy of a 26-year high, the Fed is unlikely to act anytime soon.
The latest central bank rate policy meeting gets under way on Tuesday, concluding on Wednesday. The bankers, led by Chairman Ben Bernanke, are widely expected to hold the federal funds rate, a key overnight bank lending rate, steady at historic lows near zero. What the US central bank says in the policy statement will be of the greatest interest to investors, in particular the possible hints about when it might begin to raise interest rates.
The week ahead also brings reports on housing, the labor market, and consumer and wholesale inflation. The direction of the dollar and the movement in commodities will also remain in focus.
European shares rose on Friday, led by miners as a string of economic reports indicated that China's economic recovery continues to strengthen. The pan-European Dow Jones Stoxx 600 index rose 0.5% to 245.13, extending gains from Thursday. Still, over the week it lost 1.6%.
The UK's FTSE 100 index closed up 0.3% at 5,261.57, the German DAX index climbed 0.8% to 5,756.29 and the French CAC-40 index advanced 0.1% to 3,803.72.
The Nifty ended the week flat after hitting a new 52-week high on Friday. Rising food inflation and IIP numbers, which were below Street expectations restricted gains for the market. For the week, the BSE Sensex ended flat at 17,119 while the NSE Nifty marginally added 0.2% to shut shop at 5,117.
The BSE Sensex hit an intra-week high of 17,352 and low of 16,943 while, the Nifty hit an intra-week high of 5,182 and low of 5,052
On Friday, the BSE Sensex fell 70 points to end at 17,119 after touching a high of 17,351 and a low of 17,056. The index opened at 17,219. The NSE Nifty slipped 17 points to end at 5,117.
In Asia, the Nikkei in Japan was up 2.5%, while Australia's S&P/ASX ended higher by 0.7%. Shanghai SE Composite was down 0.2% and Hang Seng index in Hong Kong was up 1%.
In Europe, stocks were trading in the green. The DAX in Germany was up 1% and the CAC 40 index in France was up 0.8%. The FTSE in the UK was up 1.2%.
Coming back to India, among the BSE sectoral indices, the Banking index was the top loser, shedding 1.3%, followed by the Realty index that was down 1% and the BSE FMCG index was down 1%.
Major gainers were BSE Capital Goods index up 0.5% and BSE Power index up 0.5%.
The BSE Mid-Cap index ended marginally lower by 0.5% while the BSE Small-Cap index was down 0.8%.
Among the 30-components of Sensex, 23 stocks ended in the red and 7 ended in the positive terrain. Bharti Airtel, HDFC, ICICI Bank, SBI and M&M were among the top laggards.
On the other hand, among the major gainers were BHEL, NTPC, ACC and Grasim.
Outside the frontline indices, the big losers in the broader market were OBC, Godrej Ind, REI Agro and GVK Power. On the other hand, gainers included Jain Irrigation, APIL, Bharat Forge and REC Ltd.
Berger Paints
We recommend a buy in Berger Paints India from a short-term perspective. It is apparent from the charts of the stock that after bottoming in October 2008 low of Rs 25.7; it has been on a long-term uptrend forming higher trading zones. However, the stock peaked at Rs 75 in September 2009 and was on corrective downtrend till late October. Subsequently finding support around Rs 55, the stock resumed its uptrend. On December 11, it surged 4 per cent surpassing the immediate resistance level. There has been an increase in volumes over the past two trading sessions. Both monthly and weekly relative strength indices are featuring in the bullish zone and the daily RSI has just entered this zone. The daily as well as weekly moving average convergence and divergence indicators are moving in the positive territory. Considering that the stock's intermediate-term uptrend-line is intact, we are bullish from a short-term horizon. We expect it to rally until it hits our price target of Rs 70. Traders with short-term perspective can buy the stock while maintaining a stop-loss at Rs 60.
via BL
Precious metals end lower for second straight week
Prices turn pale as dollar surges due to retail sales data
Bullion metal prices ended considerably lower on Friday, 11 December, 2009. Economic data helped the dollar surge up and with Friday's losses, gold witnessed its second consecutive weekly loss.
Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa.
On Friday, gold for December delivery ended at $1,119.4 an ounce, lower by $6.3 (0.6%) an ounce on the New York Mercantile Exchange. For the week, gold shed 4.2%.
Gold ended November, 2009 higher by 13%. Before that, for the third quarter it ended higher by 8.7%. For the second quarter, gold ended higher by 0.5%. The metal had gained 4.3% in the first quarter of this year. On a year to date basis, gold price is higher by 28%.
On Friday, December Comex silver futures ended lower by 8.9 cents (0.5%) at $17.084 an ounce. For the week, silver ended lower by b7.6%.
Among economic data on Friday, The University of Michigan index, released showed that consumer sentiment improved markedly in early December. The consumer sentiment index rose to 73.4 in early December from 67.4 in November.
Another report showed that the U.S. retail sales rose a better-than-expected 1.3% in November, the third increase in the past four months
In the currency market on Friday, the dollar shot up remarkably after the retail sales report. The dollar index, which weighs the strength of dollar against a basket of six other currencies rose by almost 0.8%.
In 2008, gold prices ended higher by 5.5%. The dollar index had gained 12% that year.
Crude witnesses longest losing streak in six years
Prices continue to soften as dollar becomes strong
Crude prices extended its losing streak and ended lower for eighth straight day on Friday, 11 December, 2009. This was the longest losing streak for crude in almost six years. Prices rose earlier in the day due to the report from International Energy Agency, but then, prices pared all their gains. Economic data helped the dollar surge up and with that crude prices slipped.
On Friday, crude-oil futures for light sweet crude for January delivery closed at $69.87/barrel (lower by $0.67 or 0.9%). The contract has lost almost 11% in the past eight sessions. For the week, crude ended lower by 7.4%. Crude ended month of November, higher by 0.4%. In December, till now, crude has shed almost 9%.
Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 58.2% since then.
Among economic data on Friday, The University of Michigan index showed that consumer sentiment improved markedly in early December. The consumer sentiment index rose to 73.4 in early December from 67.4 in November. Another report showed that the U.S. retail sales rose a better-than-expected 1.3% in November, the third increase in the past four months
In the currency market on Friday, the dollar shot up remarkably after the retail sales report. The dollar index, which weighs the strength of dollar against a basket of six other currencies rose by almost 0.8%.
On Friday, Paris-based IEA, hiked its forecast for 2010 global oil demand by 130,000 barrels a day to an average 86.3 million barrels a day. That represents an increase of 1.7%, or 1.5 million barrels a day, compared to 2009. The IEA also left its forecast for 2009 oil demand virtually unchanged at 84.9 million barrels a day, a decline of 1.6% year-on-year.
Last week, in the latest monthly report the EIA reported that it expects oil prices to average $76 a barrel this winter from October to March. The price target came just $1 lower than the previous month's forecast. The agency expects prices will dip to $75 early next year and will then rise to $82 a barrel by December 2010.
Among other energy products on Friday, January gasoline fell 2.22 cents, or 1.2% to $1.8351 a gallon. January heating oil added rose slightly to $1.9085 a gallon.
Also on Friday, January natural gas sank 13.5 cents, or 2.5%, to $5.163 per million British thermal units.
Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.
Techno Electric & Engineering
Investors with a high-risk appetite can consider buying the stock of Techno Electric & Engineering – an engineering procurement and construction (EPC) contractor mainly serving the power sector.
Strong orders, diversified contracting profile and low leverage are key positives for this small-sized company.
At Rs 167, the stock trades at about 10 times its estimated per share earnings for FY-11. Given the volatility prevailing in the broad markets, investors can consider accumulating the stock on declines linked to broad markets.
Techno Electric is a contracting company that provides EPC services across the power spectrum – generation transmission and distribution.
Its clients include power equipment companies such as BHEL and Kalpataru Power Transmissions and ABB as well as State Electricity Boards.
Its projects include fuel oil storage and handling systems, piping systems, switchyard and substation execution, plant lighting and earthing systems and cabling. Given its diversified profile, it also does contracting work for the steel, petrochemicals, fertilisers and metals sectors.
The services of engineering companies such as Techno Electric are crucial for execution of power plants. Larger players, especially power equipment companies, typically tend to contract a part of the plant EPC works to such smaller players. Given the massive investment in power, players such as Techno Electric may emerge as major beneficiaries.
Companies such as BGR Energy Systems, which started off as an engineering services company, have upgraded their profile to power equipment players. While Techno Electric may not have a similar growth path, the company has in recent times acquired wind power assets.
It has, in the last few months, acquired wind power assets adding up to 95 MW in Tamil Nadu and Karnataka.
Given that these assets are already up and running and have power purchase agreements with State utilities, the revenue stream as well as tax benefits would be earnings accretive.
Techno Electric has for sometime been interested in entering non-conventional energy and has obtained licences to produce biomass power.
Plants with capacity of 22 MW are expected to be commissioned in 2010. While these initiatives may not be key revenue drivers, they would help the company build assets that generate regular streams of revenue, even as it derives its key business from the conventional energy space.
For the three years ended FY-09, Techno Electric's sales and net profits grew at a compounded annual rate of 24 per cent and 63 per cent to Rs 486 crore and Rs 64 crore respectively. Current order book of Rs 1,350 crore is about 2.7 times the previous year's revenues.
While operating profit margins have expanded over 100 basis points to 13.4 per cent in the September quarter, any hike in commodity prices would hurt costs and consequently profit margins sharply.
via BL
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