Modern calendars mar the sweet simplicity of our lives by reminding us that each day that passes is the anniversary of some perfectly uninteresting event.
It's been a year since the market has bid farewell it its lows. Meanwhile, the Sensex has galloped by over 100% in a year; albeit with a couple of corrections. The story ahead doesn't appear as promising as yet. For the day, we don’t expect any broad movement as the sentiment has softened a bit. Global markets are also insipid to say the least. Given this backdrop, we expect a flat to slightly positive start and another anemic session. Select stock specific action may of course continue to hog limelight.
Technically, the NSE Nifty faces resistance at 5200 while support is likely to kick in at 5000. A break beyond this range is not expected anytime soon. Much will hinge on global cues and fund flows; also don’t forget local data points like IIP and inflation, which will be announced shortly.
Meanwhile, in Parliament, it has taken 14 long years for India to pass the Women’s Reservation Bill in Rajya Sabha. Even that was not easy as the Yadav troika put up stiff resistance. What’s more, the Bill is yet to be cleared by the Lok Sabha. The UPA seems to have lost the support of the SP and RJD. Hopefully, time will be the best healer by the time the Finance Bill comes for clearance later in Parliament.
FIIs were net buyers in the cash segment on Tuesday at Rs21.73bn on a provisional basis, including the big block deal involving the sale of Daimler AG's 5.3% stake in Tata Motors. Local funds were net sellers of Rs1.7bn, according to figures published on the NSE's web site. In the F&O segment, the foreign funds were net buyers of Rs2.82bn. On Monday, FIIs were net buyers of Rs22.59bn in the cash segment. Mutual Funds were net sellers at Rs2bn on the same day.
Thermax may make a corporate announcement related to the Power and Energy sector today.
With fears over eurozone fiscal troubles easing a bit, global investors are scouting for fresh catalysts but have found little in the way of macroeconomic or corporate data to resume the shopping spree.
US stocks ended with slight gains, buoyed by strength in the financial space and a rally in telecom sector, which benefited from Cisco's unveiling of a new router. The US stock market has gained 68% since the 17-month bear market hit its bottom one year ago.
Crude oil held above the $80 a barrel level but base metals moved lower and sugar prices registered further declines as the stronger dollar put pressure on commodity markets.
Sterling pound suffered its sharpest decline for more than a week as fears resurface over the UK’s housing market, banking sector and fiscal health. Tuesday's UK trade balance disappointed investors as the weak sterling does not seem to be helping exporters as much as the Bank of England hopes, adding to fears that GDP may falter in the first quarter.
Separately, a report said that available positions with public and private employers in the US increased in January to an adjusted 2.7mn - the highest level in nearly a year. Investors in Asia are looking to upcoming cues, such Chinese data to be released on Wednesday and Thursday.
Chinese banks made loans for about 700 billion yuan ($102.6 billion) in February, around half the 1.39 trillion yuan worth of loans issued in January, according to a report. China is officially targeting to slow bank lending in 2010 to 7.5 trillion yuan, after record loan disbursals of 9.6 trillion yuan in 2009With no new catalysts to latch on to post Budget, the Indian market continued the lackluster trend of the past few days and ended near day’s low. Major selling was witnessed in the index heavyweights like Reliance Industries, Tata Motors and DLF. Sentiment was further hit as cues from the Asian markets were not that encouraging. US market closed nearly unchanged overnight and European markets began on a slightly negative note.
The breath on the BSE Sensex was negative, out of the total 2880 stocks, 1766 declined as against 1049 advances and 65 remained unchanged.
Among the 30-components of Sensex, 19 stocks ended in the negative and 11 ended in the green.
Finally, the BSE Sensex slipped 50 points to end at 17,052 after touching a high of 17,131 and a low of 17,031. The NSE Nifty slipped 22 points to end at 5,101.
In Asia, the Nikkei in Japan ended in the red, marginally slipping 0.2%, while Australia's S&P/ASX gained 0.2%. Shanghai SE Composite ended higher by 0.5% and Hang Seng index in Hong Kong ended flat%.
In Europe, stocks were in negative terrain. The DAX in Germany was down 0.8%; the CAC 40 index in France was down 0.5% and the FTSE in the UK was down 0.5%.
Coming back to India, among the BSE sectoral indices, the Metal index was the top loser, slipping 1.7%, followed by the PSU index that was down 1.5% and the BSE Oil & Gas index was down 1.3%. Even, the BSE Mid-Cap index was down 0.8% and BSE Small-Cap index was down 0.7%.
Among the gainers were BSE IT index up 0.8% and BSE Teck index up 0.4%.
Outside the frontline indices, the big losers in the broader market were NMDC, Hindustan Copper, Gujarat NRE Coke, India Cement and Syndicate Bank. On the other hand, gainers included Shriram Transport Fin, Sintex Ind, Jain Irrigation and Exide Ind.
Shares of Reliance Industries, the index heavyweight yet again slipped below the Rs1,000 level on Tuesday. This is the second time where the stock witnessed heavy supply at its 200 DMA.
The stock looked very promising last week. Infact it also managed to cross over its 200 day moving average. With traders using every opportunity to sell the stock at higher levels, the index heavyweight is again below its Rs1,000 mark.
The ongoing tussle for ownership of the bankrupt petrochemicals firm, LyondellBasell has also taken a toll on investor sentiment. Reliance’s offer to acquire Lyondell for US$14.5bn was rejected against the foreign company’s creditors. The rejection was seen as the offer was not sufficiently valuable to LyondellBasell to abandon its reorganisation plan.
On Tuesday, the stock ended 1.5% to Rs990. It opened at Rs1005 hitting an intra-day high of Rs1015 and an intra-day low of Rs988. Total traded quantity was 0.8mn shares on the BSE.
Reliance hit its 52-week high of Rs1245 on May 19, 2009 and 52-week low of Rs570 on March 9, 2009.
Daimler AG sold 5.34% stake or 25.5mn equity shares in Tata Motors through a block deal on Tuesday morning, the deal was done at an average price of Rs750 per share on the BSE.
Through this share sale, Daimler AG has managed to raise Rs19.12bn. Citigroup is the sole banker to the Tata Motors block deal.
Shares of Tata Motors declined by 3.5% to end at Rs770. The scrip opened at Rs765 it touched an intra-day high of Rs790 and a low of Rs750 and recorded volumes of over 43.8mn shares on BSE.
Shares of NMDC slipped by 6% to end at Rs375 after the government announced that it fixed a price band of Rs300-350 for the follow-on public offer of NMDC, and will raise between Rs99-11.5bn depending on the cut-off price.
The issue will open on Wednesday. The upper end of the price band translates into a 12.6% discount to Monday’s closing price of Rs400.60, while at the lower end, the discount works out to 25%.
The government has abandoned the French auction route for the NMDC offering and will use the conventional book-building process in the hope of getting a better subscription.
The government will be divesting 8.38% of its stake ~332.2mn equity shares in NMDC, with ~17.43 lakh shares reserved for eligible employees.