There is no austerity equal to a balanced mind, and there is no happiness equal to contentment. - Chanakya.
There may be no prosperity at start on the Street as global cues are not supportive. After Spain, now Portugal has announced tough austerity steps to qualify for funds from the massive safety net provided by the EU and IMF. Optimism that the eurozone debt crisis is abating got a lift from a successful bond auction in Italy. Still, the euro fell close to 14-month lows against the dollar. Risk aversion remains elevated with the dollar index climbing above 85. Commodities are under pressure though Gold continues to attract safe haven buying. US stocks erased Wednesday’s big gains amid reports of a widening probe of large Wall Street banks. Asian markets are mostly in red this morning.
It’s a no-brainer that Indian stocks too would fall in sync with the global trend. However, the fall may not be too severe and sentiment could change for the better provided there is no further bad news from the external front. Key indices might also benefit if inflation for April turns out to be lower than anticipated. Consensus is for a drop to ~9.5% from 9.9% in March.
Results Today: Adani Enterprises, Asahi India, Bhushan Steel, Deccan Chronicle, DLF, Federal Bank, Gulf Oil, Hindustan Copper, ICI India, Kirloskar Oil, McNally Bharat, NALCO, SBI, Tanla and Videocon Industries.
FIIs were net sellers of Rs155.7mn in the cash segment on Thursday on a provisional basis, according to NSE web site. Local institutions were net buyers of Rs2.22bn. In the F&O segment, the foreign funds were net buyers of Rs18.63bn. FIIs were net sellers of Rs1.66bn in the cash segment on Wednesday, as per the SEBI data. Mutual Funds were net sellers of Rs1.28bn in the cash segment on the same day.
US stocks ended lower on Thursday, with the Dow Jones Industrial Average reversing the triple-digit gains of the previous day, as investors mulled disappointing results from Kohl's Corp. and Urban Outfitters.
The dollar strengthened versus the euro, dragging down dollar-traded oil, gold prices and stocks.
After meandering up and down, the major indexes dropped decisively in the final hour of trading. Trading volume hasn't been as strong as it was during last week's shakeout, with investors still wary.
The Dow lost 114 points, or 1%, to 10,782.95. The S&P 500 index shed 14 points, or 1.2%, to 1,157.44 and the Nasdaq Composite dropped 30 points, or 1.3%, to 2,394.36.
The consumer discretionary sector tumbled, led by a 6.7% drop in Urban Outfitters shares and a 6.6% decline in Office Depot shares. Shares of Kohl's fell 5.8%.
The government reports April retail sales figures on Friday morning.
The dollar gained 0.6% versus the euro and fell 0.6% against the yen. The euro remains at a 14-month low versus the dollar.
US light crude oil for June delivery fell $1.25 to settle at $74.40 a barrel on the New York Mercantile Exchange.
COMEX gold for June delivery lost $13.90 to settle at $1,229.20 after settling at a record high of $1243.10 Wednesday.
Treasury prices rose, pushing the yield on the 10-year note down to 3.56% from 3.57% late on Wednesday.
In the day's significant economic report, the Labor Department said that approximately 444,000 Americans filed new claims for unemployment last week, the lowest number since late March. Claims stood at a revised 448,000 the previous week. Economists had expected claims to fall to 440,000.
It was the fourth consecutive week of declining claims, but the improvement hasn't been sufficient to drive real job growth.
Continuing claims, a measure of Americans who have been receiving benefits for a week or more, rose to 4,627,000 from 4,615,000 the previous week. Economists expected 4,570,000 on average.
Meanwhile, media reports suggested that some of the financial industry's leading lights are facing investigations at both the federal and state level, as inquiries into the events that contributed to the crisis accelerate.
The Wall Street Journal cited a source that said that the Securities and Exchange Commission (SEC) has sent civil subpoenas to JPMorgan Chase, Citigroup, Deutsche Bank and UBS.
New York Attorney General Andrew Cuomo's office confirmed reports that it is investigating whether many of the same firms provided misleading information to credit rating agencies like Standard & Poor's, Moody's Corp. and Fitch.
In addition to UBS and Deutsche Bank, Cuomo is looking at Goldman Sachs, Morgan Stanley, Credit Suisse, Citigroup, Credit Agricole and Merrill Lynch, which has since been bought by Bank of America.
Bank stocks as a whole were modestly lower, with the KBW Bank index off 0.3%.
Apple and online auctioneer eBay both gained after reportedly receiving upgrades from Morgan Stanley.
But Cisco Systems shares fell 4% even after the company reported higher sales and earnings that beat estimates during what its chief executive called the company's "best quarter" ever.
Cisco weighed the most on the Dow, its shares sliding 4.5% after cautious words about the business climate from Chief Executive John Chambers.
Shares of Sybase rose 14% after German software giant SAP AG said late on Wednesday that it would pay $65 a share, or $5.8 billion in cash, for the maker of database software.
European shares advanced marginally, as strong earnings from telecom carrier BT Group and private-equity firm 3i Group offset persistent worries about sovereign-debt problems in the euro-zone. The Stoxx Europe 600 index rose 0.2% to close at 257.24.
The major regional indexes ended mixed. The German DAX index settled 1.1% higher at 6,251.97 and the UK's FTSE 100 index rose 0.9% to close at 5,433.73, while the French CAC-40 index eased 0.1% to 3,731.54.
But, the euro fell 0.4% to $1.2582 against the dollar, and banks were also lower.
German technology consulting giant SAP shares lost 1.1% after it said it has agreed to buy California-based Sybase for roughly $5.8 billion.
Shares of 3i Group rallied 7.6% after the company swung to a fiscal-year profit of 154 million pounds ($227 million), from a loss of £1.95 billion a year earlier.
Shares of BT Group rose 10.9%. Results showed the company swinging back into the black for the fourth quarter, reporting a pretax profit of £251 million.
J Sainsbury rose 3.2%. The British supermarket group reported a fiscal-year net profit that jumped to 585 million pounds, up from 289 million pounds in the prior year.
Telefonica shares declined 2.5%. The Madrid telecom services giant reported first-quarter earnings rose 2% to 1.66 billion euros ($2.11 billion) and affirmed earnings estimates for 2010.