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Tuesday, April 20, 2010
Highlights of FY11 Annual Policy Statement
* Hikes reverse repo, repo rate, CRR by 25bps each
* Reverse repo, repo rate hikes with immediate effect
* CRR hike effective from Apr 24
* CRR hike to impound 125 bln rupees from banks
* FY11 GDP growth projection at 8.0% with upside bias
* March end inflation projection at 5.5%
* FY11 banks' credit growth projection at 20.0%
* FY11 banks' deposit growth projection at 18.0%
* FY11 money supply growth projection at 17.0%
.
STANCE
* Hike in policy rates, CRR to help contain inflation
* Hike in policy rates, CRR to anchor inflationary expectations
* Measures to sustain recovery process
* Govt borrow needs, private credit demand will be met
* Hikes to align policy tools with evolving state of econ
* To closely monitor macro events, prices; take warranted steps
* Econ firmly on recovery path, industrial growth broad based
* India economy resilient, recovery consolidating
* FY11 econ growth to be higher, more broad-based vs FY10
* Lower policy rates can complicate inflation outlook
* Lower policy rates also impair inflationary expectations
* Despite 25bps hike in rates, real policy rates still negative
* Need to
normalise policy rates in calibrated manner
* Inflationary pressures "accentuated" in recent period
* Inflation getting increasingly generalised
* Capacity constraints to re-emerge as econ growth rises
* Must ensure demand-side inflation does not become entrenched
* FY11 fresh govt bond issuances 36.3% higher vs FY10
* FY11 fresh govt bond issuances "a dilemma"
* Policy considerations demands liquidity be curbed
* Govt borrow needs supportive liquidity conditions
* Need to absorb liquidity without hurting govt borrow plan
* To respond swiftly, effectively to inflationary expectation
* To actively manage liquidity, ensure private credit demand is met
.
INFLATION
* Significant changes in drivers of inflation in recent months
* Overall food inflation high despite seasonal ease
* Rise in global commodity prices upside risk to inflation
* Household inflation expectations remain at elevated level
* Demand pressures may rise as recovery gains momentum
* Monsoon prospects unclear, blur FY11 inflation outlook
* Volatile crude prices cloud FY11 inflation outlook
* To ensure price stability, anchor inflationary expectations
* To monitor overall, disaggregated components of inflation
* keeps medium-term inflation objective of 3.0%
* An unfavourable monsoon may exacerbate food inflation
* Unfavourable 2010 monsoon may add to fiscal burden
.
GROWTH
* GDP projection assumes normal monsoons
* GDP projection also assumes good industrial, services growth
* Industrial growth to take firmer hold going forward
.
FISC
* Fiscal prudence to avoid crowding out private credit demand
* Fiscal prudence must shift to structural improvements
* Govt borrow "very large", can pressure interest rates
.
GLOBAL
* Pace of global econ recovery remains uncertain
* Uncertain global econ recovery downside risk to India GDP
* Trade, financial linkages to other economies may impact India GDP
* Commodity price seen up more if global recovery gain momentum
* Rise in global commodity prices may up inflation pressure
* Expansionary fiscal policy may not be unwound in advanced economies
* Expansionary policies may trigger large FX flows to India
* Excessive flows challenge to FX rate, monetary mgmt
* FX rate policy not guided by pre-announced target
* Keep flexibility to intervene in FX market to manage volatility
* Need to be vigilant volatile FX rate movements
.
MARKET
* RBI panel to mull single point reporting for OTC FX derivatives
* To launch reporting platform for secondary deals of CDs, CPs
* Asked FIMMDA to develop CD, CP reporting platform
* To allow banks to purchase non-SLR bonds by infra companies in HTM
* OKs bourses to launch plain vanilla dollar/rupee options
FIIs turn net sellers in equities on Apr 19 worth Rs 4.75 bn
Foreign Institutional Investors (FIIs) turned net sellers in equities worth Rs 4,757 million on Apr 19. They bought equities worth Rs 17,476 million and sold equities worth Rs 22,233 million. Till Apr 19, they have been net buyers in equities worth Rs 34,676 million.
FIIs turned net sellers in the debt segment worth Rs 2,536 million on Apr 19. They buy debt worth Rs 3,005 and they sold debt worth Rs 5,541 million. Till Apr 19 they have been net sellers in debt worth Rs 11,207 million.
MFs remain net sellers in equities on Apr 19
Mutual Funds (MFs) remained net sellers in equities worth Rs 1,195 million on Apr 19. They bought equities worth Rs 4,113 million and sold equities worth Rs 5,308 million. Till Apr 19 they have been net buyers in equities worth Rs 19,460 million.
MFs remained net buyers in debt segment worth Rs 28,772 million on Apr 19 They bought debt worth Rs 51,938 million and they sold debt worth Rs 23,166 million. Till Apr 19 they have been net buyers in debt worth Rs 530,045 million.
Policy rates in sync; bulls cheer
Today's major news
Reserve Bank of India hikes repo, reverse repo and CRR by 25 basis points
Direct tax collection falls short of FY2010 target
Axis Bank’ Q4FY2010 net profit up by 31.5%; the stock jumped 2.51%
For more stories click here
Global signals
European equities were trading in positive territory on gains in banking scrips. As of writing of this report, FTSE 100 (London) was trading 0.49% up.
All the major Asian indices except Shanghai Composite (China) and Nikkei (Japan) closed in green. SGX Nifty closed 31 points higher.
US stock futures point to flat to positive start for the Wall Street on Tuesday. Goldman Sachs will be in focus as the company is expected to report is first quarter earnings.
Indian indices
Bulls make RBI monetary policy review a launching pad to snap the five-day-long losing streak to end the session higher. The Reserve Bank of India raising the repo, reverse repo and cash reserve ratio (CRR) by 25 basis points each was in line with the market’s expectations.
Opening six points lower (at 17395), bulls leveraged on fair to good India Inc earnings to move higher. But the going got difficult as investors opted to stay at sidelines in wake of the monetary policy review due afternoon. With the policy coming out in line with the street’s expectations, bulls charged with rate-sensitive counters—banking and realty—pushing the market to the day’s high of 17560. Post-lunch, bulls lost some ground on selling in information technology stocks to sign off the session with a little more than a consolatory win. Sensex closed 60 points higher at 17460, while Nifty shut at 5230, 26 points up.
Market sentiment
Advancing shares outnumbered trailing ones far convincingly. Of the 2,967 stocks traded on the BSE, 2,088 stocks advanced, whereas 785 stocks declined. Ninety four stocks closed unchanged.
Sectoral & stock screening
Interest rate sensitive sectors like realty and banking sectors topped the chart of gainers as BSE Realty and BSE Bankex surged by 3.08% and 1.53% respectively. On flip side, BSE IT and BSE TECk were the only indices that closed in negative with losses of 1.28% and 1.00% respectively.
The top picks were Procter & Gamble (up 6.51%), Nagarjuna Constructions (6.28% up) and Adani Enterprises (higher 6.20%). And the worst picks were Tata Consultancy (down 2.74%) despite a strong FY2010 earnings and Zee Entertainment (2.58% down).
Viewing volumes
Realtors gained on policy rate reviews. With over 1.45 crore shares changing hands on the BSE, Unitech, India’s second largest realty company, was the most actively traded share, followed by wind turbine major Suzlon Energy (0.50 crore shares), steel maker Ispat Industries (0.36 crore shares), industrial finance company IFCI (0.27 crore shares) and India’s largest realty firm, DLF (0.22 crore shares).
BSE Bulk Deals to Watch - Apr 20 2010
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
20/4/2010 530901 ACIL Cot Inds ABHIJAI INVESTMENT B 75000 32.90
20/4/2010 530901 ACIL Cot Inds AAKANSHA RAJENDRA SURANA S 133510 32.91
20/4/2010 533159 AQUA LOGIST CROSSEAS CAPITAL SERVICES PRIVATE LIMITED B 111280 333.63
20/4/2010 533159 AQUA LOGIST CROSSEAS CAPITAL SERVICES PRIVATE LIMITED S 111280 334.03
20/4/2010 533163 Arss Infra Proj GENUINE STOCK BROKERS PVT. LTD. B 95145 1269.41
20/4/2010 533163 Arss Infra Proj SMART EQUITY BROKERS PRIVATE LIMITED B 102093 1271.22
20/4/2010 533163 Arss Infra Proj OPG SECURITIES P LTD B 351768 1271.71
20/4/2010 533163 Arss Infra Proj GENUINE STOCK BROKERS PVT. LTD. S 95145 1269.38
20/4/2010 533163 Arss Infra Proj SMART EQUITY BROKERS PRIVATE LIMITED S 102093 1271.54
20/4/2010 533163 Arss Infra Proj OPG SECURITIES P LTD S 351768 1271.96
20/4/2010 531591 Bampsl Sec PRAKASH CHAND GUPTA B 978958 1.50
20/4/2010 531591 Bampsl Sec KAUSHALYA GARG B 1988108 1.52
20/4/2010 531591 Bampsl Sec PRAKASH CHAND GUPTA S 452220 1.51
20/4/2010 531591 Bampsl Sec ASHOKKUMAR SONI S 500000 1.56
20/4/2010 531591 Bampsl Sec ANJU GUPTA S 500000 1.49
20/4/2010 531591 Bampsl Sec GIRRAJ PRASAD GUPTA S 514404 1.49
20/4/2010 513333 Bhuwalka Steel SURYA PRAKASH HEDA S 55000 62.86
20/4/2010 511607 Birla Shloka TOUCHSTONE FINVEST SERVICES PRIVATE LIMITED B 102896 74.45
20/4/2010 511607 Birla Shloka DEVKANT SYNTHETICS INDIA PVT. B 100000 74.55
20/4/2010 511607 Birla Shloka TOUCHSTONE FINVEST SERVICES PRIVATE LIMITED S 102896 74.55
20/4/2010 531194 Brahmaputra Infra ANMOL FINPRO PVT LTD B 50825 109.56
20/4/2010 531194 Brahmaputra Infra ABHESH KUMAR MISHRA S 38438 109.46
20/4/2010 511628 Brescon Corp SAL REAL ESTATE PRIVATE LIMITED B 20000 116.23
20/4/2010 500083 Century Extr BHARAT SHANKAR PHAPALE B 392125 11.88
20/4/2010 517973 DMC Intl BHARAT GUPTA B 257913 18.74
20/4/2010 517973 DMC Intl OURS TRADING AND HOLDINGS PRIVATE LIMITED B 148264 18.78
20/4/2010 517973 DMC Intl OURS TRADING AND HOLDINGS PRIVATE LIMITED S 157764 18.82
20/4/2010 517973 DMC Intl KAPIL GUPTA S 127983 18.62
20/4/2010 517973 DMC Intl SHARK COMMUNICATION PVT LIMITED S 128793 18.80
20/4/2010 517973 DMC Intl J A FINANCIAL AND MANAGEMENT CONSULTANTS PVT LTD S 257239 18.71
20/4/2010 526703 Ecoplast BP FINTRADE PRIVATE LIMITED B 28010 33.40
20/4/2010 526703 Ecoplast MAVERICK INVESTMENT SOLUTION PVT LTD S 85200 33.25
20/4/2010 532666 FCS Software AMAR KANAIYALAL CHAUHAN B 5675707 5.46
20/4/2010 532666 FCS Software AMAR KANAIYALAL CHAUHAN S 4174453 5.29
20/4/2010 522017 Fluidomat RAHUL DOSHI B 25000 30.56
20/4/2010 512493 Garnet Intl PRAKASHCHAND TULSIRAMBIHANI S 30000 125.50
20/4/2010 533189 GOENKA DIAM SAHAR VYAPAR PRIVATE LIMITED B 780007 115.61
20/4/2010 533189 GOENKA DIAM CROSSEAS CAPITAL SERVICES PRIVATE LIMITED B 203873 116.20
20/4/2010 533189 GOENKA DIAM CROSSEAS CAPITAL SERVICES PRIVATE LIMITED S 203873 116.59
20/4/2010 533189 GOENKA DIAM ANKIT JAIN S 348631 114.50
20/4/2010 533189 GOENKA DIAM SAHAR VYAPAR PRIVATE LIMITED S 780007 116.63
20/4/2010 532439 Goldstone Infra TRANSGLOBAL SECURITIES LTD. B 429936 33.87
20/4/2010 532439 Goldstone Infra TRANSGLOBAL SECURITIES LTD. S 417938 33.92
20/4/2010 532951 GSS America DHANANJAYA MONEY MANAGEMENT SERVICES PVT LTD B 107381 344.81
20/4/2010 532951 GSS America MADHUKAR CHIMANLAL SHETH B 100000 344.49
20/4/2010 532951 GSS America DHANANJAYA MONEY MANAGEMENT SERVICES PVT LTD S 99047 344.50
20/4/2010 532951 GSS America BENNETT COLEMAN & CO LTD S 105995 345.47
20/4/2010 507960 Gujarat Hotels INNOVISION SECURITIES PRIVATE LIMITED B 21602 81.43
20/4/2010 507960 Gujarat Hotels INNOVISION SECURITIES PRIVATE LIMITED S 21602 83.73
20/4/2010 511682 IFL Promoters OURS TRADING AND HOLDINGS PRIVATE LIMITED B 25376 16.63
20/4/2010 511682 IFL Promoters OURS TRADING AND HOLDINGS PRIVATE LIMITED S 25038 16.74
20/4/2010 507981 Jindal Hotels R B K SECURITIES PRIVATE LIMITED B 30000 70.74
20/4/2010 507981 Jindal Hotels RAHUL DOSHI S 20570 71.51
20/4/2010 530955 Kailash Ficom ABHIJAI INVESTMENT S 59800 35.86
20/4/2010 532268 Kale Consl RASHI EQUISEARCH PVT. LTD. B 74809 107.38
20/4/2010 532268 Kale Consl RASHI EQUISEARCH PVT. LTD. S 86148 107.63
20/4/2010 590041 Kavveri Telecom M M GANESH S 104977 99.49
20/4/2010 530255 KAY Power MANOJ WADHWA B 54330 16.71
20/4/2010 530255 KAY Power KAILASHCHAND GUPTA B 72830 16.44
20/4/2010 530255 KAY Power BAMPSL SECURITIES LTD B 83027 16.78
20/4/2010 530255 KAY Power KAUSHALYA GARG B 57790 17.10
20/4/2010 530255 KAY Power KAUSHALYA GARG S 245000 16.53
20/4/2010 530255 KAY Power BAMPSL SECURITIES LTD S 171490 16.47
20/4/2010 532067 Kilpest India SNEH GANGWAL B 162300 18.63
20/4/2010 532067 Kilpest India REKHA BHANDARI S 81513 18.56
20/4/2010 532067 Kilpest India ACME FURNITURE PRIVATE LIMITE S 160000 18.63
20/4/2010 531602 Koffee Break NAVIN GROVER B 507322 1.68
20/4/2010 531602 Koffee Break ACHALA ELECTRICALS PRIVATE LIMITED S 630301 1.68
20/4/2010 531366 Kohinoor Broad DELIGHT FINANCIAL ADVISOR PVT LTD B 824210 8.76
20/4/2010 531366 Kohinoor Broad DELIGHT FINANCIAL ADVISOR PVT LTD S 824210 8.84
20/4/2010 509011 Livingroom Life JEHANGIR TURABALI NAGREE S 30000 46.05
20/4/2010 524000 Magma Fin WELLINGTON BAY POND MB WELLINGTON MGT. CO. LLP A\C B 125739 302.00
20/4/2010 590111 MASTER NAGESH YELEWARAPU B 37005 37.84
20/4/2010 590111 MASTER VIJAY KUMAR TUMMALA B 53003 37.48
20/4/2010 590111 MASTER VENKATA SIVA GANGADHRA RAO P B 29150 37.44
20/4/2010 590111 MASTER NIKHIL SECURITIES LTD B 50000 36.73
20/4/2010 590111 MASTER VIJAY KUMAR TUMMALA S 53000 37.57
20/4/2010 590111 MASTER NAVEEN MORTHA S 27500 37.47
20/4/2010 590111 MASTER RAMATULASI MORTHA S 33000 37.91
20/4/2010 507813 National Oxygen BDS SHARE BROKERS PVT LTD B 18206 55.54
20/4/2010 507813 National Oxygen DADABHOY FL B 21821 55.87
20/4/2010 507813 National Oxygen BDS SHARE BROKERS PVT LTD S 18906 55.76
20/4/2010 531834 Natura Hue Chem AHMED SAYED B 70361 14.71
20/4/2010 519560 Neha Intl AJMERA SHARES TRADING PRIVATE LIMITED B 132642 177.14
20/4/2010 519560 Neha Intl SANJAYKUMAR JAGDISHPRASAD PODDAR B 100000 174.00
20/4/2010 519560 Neha Intl BHARAT ZAVERCHAND BHUPTANI B 100000 175.00
20/4/2010 519560 Neha Intl SARVAPRATHAM INVESTMENT LIMITED B 100000 174.00
20/4/2010 519560 Neha Intl B.K.KHULLAR & CO S 505000 175.25
20/4/2010 531496 Omkar Overseas AMRUT SECURITIES LTD. B 38046 69.88
20/4/2010 512097 Oregon Comm KRUPA SANJAY SONI B 9314 217.03
20/4/2010 512097 Oregon Comm DHIRENKUMAR DHARAMDAS AGARWAL B 18312 217.04
20/4/2010 512097 Oregon Comm KRUPA SANJAY SONI S 17640 217.35
20/4/2010 532606 Parekh Alum M/S LAXMI CAP BROKING PVT LTD B 77696 177.40
20/4/2010 513611 Pithampur Steel CHETAN DOGRA B 41500 23.70
20/4/2010 513611 Pithampur Steel JATIN ARORA B 29000 23.70
20/4/2010 513611 Pithampur Steel SACHIN SHARMA S 95000 23.70
20/4/2010 504288 Polar Inds ATRUN FISCAL PVT LTD B 65000 6.05
20/4/2010 531467 Polypro Fibrils NAMRATA KUNJAN DELIWALA B 35000 40.86
20/4/2010 531467 Polypro Fibrils PRITI JAYESH SHAH S 50000 40.84
20/4/2010 503873 Priyadarshini Spn PRADEEP KR AGGARWAL B 79890 31.70
20/4/2010 533083 RISHABHDEV SAAKSHI SHARES PVT LTD S 165750 11.04
20/4/2010 532841 Sahyadri Inds S K TRADING (S K CHOURASIA) B 55398 173.40
20/4/2010 515043 Saint Gobain ASHOK CHINUBHAI SHAH S 532243 28.72
20/4/2010 504614 Sarda Energy OPG SECURITIES P LTD B 208371 299.70
20/4/2010 504614 Sarda Energy OPG SECURITIES P LTD S 208371 299.86
20/4/2010 533056 SARK SYS SHREE VIHAR HOUSING & DEVELOPERS (P) LTD B 100000 35.48
20/4/2010 533056 SARK SYS MAG IMPEX PRIVATE LIMITED S 82350 35.19
20/4/2010 533056 SARK SYS CHIRAYUSH AGRO MARKETING PRIVATE LIMITED S 90000 35.50
20/4/2010 533056 SARK SYS SANJEETKUMAR CHOURASIA S 92000 33.94
20/4/2010 533056 SARK SYS SWETATI BREWALA S 73000 34.23
20/4/2010 511144 Saya Housing POORNIMA COMMERCIAL PVT LTD S 16000 2.86
20/4/2010 531645 Southern Ispat SHALIN MAHESHBHAI SHAH S 64315 23.61
20/4/2010 522296 SS Forgings ANKUR CHOPRA B 97200 4.00
20/4/2010 522296 SS Forgings HIGHLIGHT LEAFIN PRIVATE LIMITED S 115000 4.01
20/4/2010 530611 Sturdy Inds PRECISE TOOLS & EQUIPMENTS PRIVATE LIMITED S 232378 5.46
20/4/2010 530883 Super Crop YOGESH MANUBHAI PATEL S 30680 12.09
20/4/2010 526133 Supertex Inds HUSSAIN MOHAMMED SHAIKH B 500000 3.80
20/4/2010 526133 Supertex Inds PARAMESHWAR EXPORTS PRIVATE LIMITED B 687648 3.87
20/4/2010 526133 Supertex Inds PARAMESHWAR EXPORTS PRIVATE LIMITED S 787648 3.83
20/4/2010 533089 TELE TECHNO DELIGHT FINANCIAL ADVISOR PVT LTD B 2511122 3.49
20/4/2010 533089 TELE TECHNO DELIGHT FINANCIAL ADVISOR PVT LTD S 2511122 3.52
20/4/2010 519152 Vadilal Enter RUPAPRADI P SHAH B 5000 102.09
20/4/2010 519152 Vadilal Enter MAULIK BHARAT SHAH B 17751 97.44
20/4/2010 519152 Vadilal Enter SUSHEELA TIWARI B 20451 96.19
20/4/2010 519152 Vadilal Enter SUSHEELA TIWARI S 20451 97.69
20/4/2010 519152 Vadilal Enter MAULIK BHARAT SHAH S 17751 98.48
20/4/2010 519152 Vadilal Enter CHAMPAKLAL MANSUKHLAL GANDHI S 5457 96.28
20/4/2010 532389 Valecha Engr AJMERA SHARES TRADING PRIVATE LIMITED B 300919 213.17
20/4/2010 532389 Valecha Engr AJMERA SHARES TRADING PRIVATE LIMITED S 303269 212.12
20/4/2010 530459 Valson Inds RAJIV MEHTA B 28081 29.60
20/4/2010 532677 Vikash Metal ARCADIA SHARE & STOCK BROKERS PVT. LTD B 165095 22.14
20/4/2010 531396 Women Networks DEEPAK REDH S 25000 33.75
20/4/2010 531396 Women Networks MARUTI TRADING COMPANY(PROPRIETOR T C PUGALIA HUF) S 24000 33.74
20/4/2010 530091 Zyden Gentec SAURABHKUMAR RASIKLAL GANDHI B 217000 2.30
20/4/2010 530091 Zyden Gentec DEEPAK REAL ESTATEDEVE. I. P.L S 300000 2.30
* B - Buy, S - Sell
NSE Bulk Deals to Watch - Apr 20 2010
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
20-APR-2010,AQUA,Aqua Logistics Ltd,CROSSEAS CAPITAL SERVICES PVT. LTD.,BUY,111280,333.68,-
20-APR-2010,ARSSINFRA,ARSS Infra Proj. Ltd,C D INTEGRATED SERVICES LTD.,BUY,74386,1270.66,-
20-APR-2010,ARSSINFRA,ARSS Infra Proj. Ltd,GENUINE STOCK BROKERS PVT LTD,BUY,120033,1269.84,-
20-APR-2010,ARSSINFRA,ARSS Infra Proj. Ltd,MANIPUT INVESTMENTS PVT. LTD.,BUY,123015,1269.18,-
20-APR-2010,GOENKA,Goenka Diamond&Jewels Ltd,CROSSEAS CAPITAL SERVICES PVT. LTD.,BUY,203873,116.22,-
20-APR-2010,GOENKA,Goenka Diamond&Jewels Ltd,PAWANSUT TIE-UP PRIVATE LTD,BUY,175000,116.57,-
20-APR-2010,GOLDINFRA,Goldstone Infratech Ltd.,SAR AUTO PRODUCTS LIMITED,BUY,46000,34.03,-
20-APR-2010,GOLDINFRA,Goldstone Infratech Ltd.,TRANSGLOBAL SECURITIES LTD.,BUY,683702,33.86,-
20-APR-2010,KALECONSUL,Kale Consultants Limited,JMP SECURITIES PVT LTD,BUY,109177,110.98,-
20-APR-2010,KALECONSUL,Kale Consultants Limited,MANISH VRAJLAL SARVAIYA,BUY,72628,106.03,-
20-APR-2010,KALECONSUL,Kale Consultants Limited,RASHI EQUISEARCH PVT. LTD.,BUY,87264,107.48,-
20-APR-2010,MAGMA,Magma Fincorp Limited,BONSAI PROPERTIES PRIVATE LTD,BUY,130000,302.35,-
20-APR-2010,MAGMA,Magma Fincorp Limited,SUPREME TIE UP PVT LTD,BUY,123100,302.00,-
20-APR-2010,MAGMA,Magma Fincorp Limited,WELLINGTON BAY POND BMD MB,BUY,295934,301.98,-
20-APR-2010,MAGMA,Magma Fincorp Limited,WELLINGTON BAY POND MB,BUY,623289,301.98,-
20-APR-2010,PARAL,Parekh Aluminex Limited,M/S.LAXMI CAP BROKING PVT LTD,BUY,69935,177.24,-
20-APR-2010,TELEDATAIT,Teledata Technology Solut,DELIGHT FINANCIAL ADVISOR PVT LTD,BUY,3611950,3.48,-
20-APR-2010,VALECHAENG,Valecha Engineering Limit,AASHKA CONSTRUCTION PVT LTD,BUY,225995,210.86,-
20-APR-2010,VALECHAENG,Valecha Engineering Limit,MANSUKH SECURITIES & FINANCE LIMITED,BUY,91827,209.31,-
20-APR-2010,AQUA,Aqua Logistics Ltd,CROSSEAS CAPITAL SERVICES PVT. LTD.,SELL,111280,333.66,-
20-APR-2010,ARSSINFRA,ARSS Infra Proj. Ltd,C D INTEGRATED SERVICES LTD.,SELL,74386,1270.74,-
20-APR-2010,ARSSINFRA,ARSS Infra Proj. Ltd,GENUINE STOCK BROKERS PVT LTD,SELL,120033,1270.48,-
20-APR-2010,ARSSINFRA,ARSS Infra Proj. Ltd,MANIPUT INVESTMENTS PVT. LTD.,SELL,123015,1269.31,-
20-APR-2010,GOENKA,Goenka Diamond&Jewels Ltd,CROSSEAS CAPITAL SERVICES PVT. LTD.,SELL,203873,116.17,-
20-APR-2010,GOENKA,Goenka Diamond&Jewels Ltd,PAWANSUT TIE-UP PRIVATE LTD,SELL,175000,115.94,-
20-APR-2010,GOENKA,Goenka Diamond&Jewels Ltd,RAVINDRA KUMAR SINGHVI,SELL,200000,115.50,-
20-APR-2010,GOLDINFRA,Goldstone Infratech Ltd.,SAR AUTO PRODUCTS LIMITED,SELL,320000,33.35,-
20-APR-2010,GOLDINFRA,Goldstone Infratech Ltd.,TRANSGLOBAL SECURITIES LTD.,SELL,683702,33.88,-
20-APR-2010,KALECONSUL,Kale Consultants Limited,JMP SECURITIES PVT LTD,SELL,16149,112.53,-
20-APR-2010,KALECONSUL,Kale Consultants Limited,MANISH VRAJLAL SARVAIYA,SELL,72628,106.18,-
20-APR-2010,KALECONSUL,Kale Consultants Limited,RASHI EQUISEARCH PVT. LTD.,SELL,75648,107.43,-
20-APR-2010,KAVVERITEL,Kavveri Telecom Products,GANESH M M,SELL,55023,99.48,-
20-APR-2010,MAGMA,Magma Fincorp Limited,RELIANCE INFRASTRUCTURE AND CONSULTANTS LIMITED,SELL,1230000,302.00,-
20-APR-2010,MAGMA,Magma Fincorp Limited,SUPREME TIE UP PVT LTD,SELL,63100,302.01,-
20-APR-2010,ORBITCORP,Orbit Corporation Limited,CLSA (MAURITIUS) LIMITED,SELL,610000,310.99,-
20-APR-2010,SHRENUJ,Shrenuj & Co. Ltd-Depo,JOHN FOWLER (INDIA) PVT LTD,SELL,480000,51.62,-
20-APR-2010,TELEDATAIT,Teledata Technology Solut,DELIGHT FINANCIAL ADVISOR PVT LTD,SELL,3581474,3.54,-
20-APR-2010,VALECHAENG,Valecha Engineering Limit,AASHKA CONSTRUCTION PVT LTD,SELL,225995,212.06,-
20-APR-2010,VALECHAENG,Valecha Engineering Limit,MANSUKH SECURITIES & FINANCE LIMITED,SELL,91827,209.10,-
Asia ekes out modest gains
Gains capped for broad markets as dollar continues to show conviction
Asian markets moved up today, cutting yesterday's losses as risk appetite flipped back and buying ticked up right from the start though a negative close for Japanese and Chinese stocks did not go well for the investors. Buoyant results from Citigroup yesterday lead to reprieve for the financial shares and positive overnight cues from Wall Street and a rebound in commodities helped the market sentiments turn around. However, a stubborn show of strength by the US dollar in much of Asian trades capped the upside for the regional benchmarks, most of them coming off the days highs in the closing hours.
The risk appetite was seemingly strong at the start of the day but waned somewhat as the US dollar turned the corner after hitting a high of 1.3523 against the Euro. The single currency once again firmed up under 1.3500 as worries continued about the sorry state of Greece finances.
The Australian market ended in positive territory taking cues from Wall Street where the major averages ended with modest gains following reports that the SEC vote on charging Goldman Sachs was split. The benchmark S&P/ASX200 Index advanced 10.70 points, or 0.22% to close at 4926, while the All-Ordinaries Index ended at 4,949, representing a gain of 10.10 points, or 0.20%.
On economic front, minutes of the recent board meeting of Reserve Bank of Australia revealed that the members of the policy board felt this month that a rate increase was warranted given a faster than expected recovery in the country's terms of trade. The members also hinted that more rate hikes will be necessary as the Australian economy continues its robust rebound from the global downturn.
Japanese stocks ended mixed with Nikkei ending weaker while broader Topix Index ended in positive territory, as exporters and commodity stocks slipped in late trading session on yen strength and profit selling. The benchmark Nikkei 225 Index fell 8.09 points, or 0.1%, to 10901, while the broader Topix index of all First Section issues rose 1.27 points, or 0.1%, to 972.
On the economic front, a report released by the Ministry of Economy, Trade and Industry revealed that an index measuring tertiary industrial activity in the country declined a seasonally adjusted 0.2% in February compared to the previous month. Economists expected the index to contract 1% for the month following 2.9% increase in the previous month.
However, Chinese markets failed to swing around after a ferocious slide yesterday. About two stocks rose for each one that fell on the Shanghai Composite Index, which lost 0.76 point, or less than 0.1 %, to 2979.53 at the close. Chinese shares, down nearly 5 % on Monday before after government took more action to restrain property prices, were hurt by lack of buying conviction as the overheating worries remained firmly entrenched.
Hong Kong stocks pulled back from a three-week low today with domestic plays such as China Mobile rising on expectations of consumption growth on the mainland. The benchmark Hang Seng Index closed up 1.02 % at 21623.
In Mumbai, the key benchmark indices eked out small gains, snapping last five days' losses, after the Reserve Bank of India (RBI) announced a small increase in policy rates at a monetary policy review. Firm global stocks also supported the domestic bourses. The BSE 30-share Sensex was provisionally up 60.68 points or 0.35%. Interest rate sensitive banking, auto and realty stocks rose. Index heavyweight Reliance Industries (RIL) edged higher in volatile trade.
Investors heaved a sigh of relief after a small hike in short term rates and cash reserve ratio (CRR) by the central bank. Reserve Bank of India (RBI) raised repo rate, reverse repo rate and CRR by 25 basis points each. Analysts were expecting a 25 to 50 basis points hike in short term rates and the CRR. The RBI said it will continue to monitor macroeconomic conditions, particularly the price situation closely and take further action as warranted.
The hike in CRR is effective from 24 April 2010 while repo and reverse repo rate hikes are applicable immediately. After the hike, the CRR will increase to 6%, the repo rate to 5.25% and the reverse repo to 3.75%. Repo is the rate at which the central bank lends to banks and reverse repo is the rate at which the central bank absorbs excess cash from the banking system. CRR is the portion of deposits banks must set aside with the RBI.
Most Asian markets rebounded modestly, following Wall Street higher as financial stocks recovered from a sell-off prompted by the U.S. government's fraud case against Goldman Sachs.
In other markets, South Korea's Kospi closed up 0.8 % while Thailand's key stock measure surged more than 3 %.
Light sweet crude oil futures for June delivery were last seen quoting at $83.95, up 82 cents from the previous close. The commodity raced up earlier, after the yesterday's drop of nearly two dollars. Prices failed to hold on above $84 as the strength in the US dollar curbed the gains and some selling emerged ahead of the API inventories data, which is due later on today.
Talwalkars Better Value Fitness IPO Analysis
Talwalkars Better Value Fitness is one of the largest fitness chains in India offering a diverse suite of services including gyms, spas, aerobics and health counseling under the brand "Talwalkars". It is promoted by Mr. Madhukar Talwalkar, Mr. Prashant Talwalkar, Mr. Vinayak Gawande, Mr.Girish Talwalkar, Mr. Harsha Bhatkal and Mr. Anant Gawande. "Talwalkars" has pioneered the concept of gyms in India and today is a recognized name in the health and fitness industry.
Currently the company operates 58 health clubs out of which 44 health clubs are owned by the company, 9 health clubs are Joint Ventures (JV)/Associates and the rest 5 health clubs are run through franchisees. It is present in 24 cities belonging to 11 states of the country and serving over 55,000 members. The company has added 15 health clubs in FY09. In FY10, the company has added 9 health clubs. In the near term the company is going to start 7 health clubs, for which premises have been taken on lease and gym equipments have been ordered. Moreover for 4 clubs, the company has completed the planning phase and will commence execution very soon.
The company has also entered into arrangements with established local fitness operators to accelerate gym ramp-up in specific locations. For instance, it has formed JV with Pantaloons Retail (India) to promote mall-based gymnasiums in India. The strategy is to leverage the large number of daily footfalls in Pantaloon Malls as potential clientele. The health clubs under this format are bigger in size and have more number of equipment. Currently it owns 6 gyms named ‘Fit & Active' through this JV viz, one each at Mumbai, NCR, Nagpur, Siliguri (WB) and two at Bangalore.
Moreover, the company through Denovo Enterprises owns health clubs at Indore and Jaipur while the company has also entered into an agreement with Equinox Wellness to own a health club at Kolkata. The company has five clubs under franchisee model with two each in Delhi and Nagpur and one in Mumbai.
The company has signed a Memorandum of Understanding (MoU) for a JV with Life Fitness India to set up 4 gyms in Pune. This gives the former a compulsory right to buy out these 4 gyms on March 31, 2013 and also an option to buy the existing 4 gyms currently operated by them.
The company offers three product/services: A) Fitness Training which includes personal exercise program, body sculpting and body shaping. B) Nutrition Centre which includes weight loss program, weight maintenance program and weight gain program. C) Value Add-ons which includes spa & massage, aerobics, spinning and steam & sauna bath.
In 2009, the company established a 7500 sq. ft. training academy at Thane, to impart training to fitness trainers both newly recruited as well as the existing staff. The course duration typically ranges from 30-45 days. A significant part of the training is focused on the nuances of fitness, incorporating both practical and theoretical aspects covering weight training, cardio vascular fitness, and nutrition.
The company intends to enter capital market to raise money in the range of Rs 74.42 crore to Rs 77.44 crore by issuing around 60.5 lakh equity share of face value of Rs 10 each at the price range of Rs 123 to Rs 128 per share. The company is raising this money to add another 27 health clubs in FY11. Each health club has capital expenditure of approximately around Rs 1.86 crore which turn into Rs 50.22 crore for 27 clubs. The company also plans to repay its unsecured loan amounting to Rs 20.6 crore (out of which Rs 15.7 crore will be paid to group entities).
Strengths
The growing awareness about fitness and a healthy lifestyle is providing a huge opportunity for health and fitness industry. Significant changes in lifestyle due to lack of physical activity and increased consumption of fast foods among both affluent and working class population has led to the greater need for healthy lifestyles through sports, fitness centres and counselling on dietary habits.
The rising income levels and growing young population also favour consistent growth for the industry
The fitness market in India is severely under penetrated even when compared to other Asian countries. India has a penetration rate of just 0.4% compared to the Asia Pacific average of 3.7%. This leaves ample space for the company to grow.
The company has pan India presence that operates 58 health clubs spread across 28 cities.
Weaknesses
The company operates in a highly competitive market and face stiff competition from other players operating both in organized and un-organized sectors. Also big foreign players have also entered the Indian market, which can give tough competition to the company.
A group, controlled by Mr. Rahul Talwalkar, Mr. Rohit Talwalkar and Mr. Amber Talwalkar all being nephews of Mr. Madhukar Talwalkar, operates gymnasiums under the company ‘Talwalkars Fitness Solutions Pvt Ltd' (TFSPL). They are operating their 13 gymnasiums at various locations namely Mumbai, Baroda, Ahmedabad, Raigad, Thane and Nasik. This group owns and operates gyms under the same or similar name and can claim the history of the brand.
There are other group companies operated by promoter directors, which offer similar services:
* There are 11 gyms operating under the company's registered brand ‘Talwalkars' which are owned and operated by the Group Companies / entities. Of these 7 gyms are held by three of Promoter-Directors Mr. Madhukar Talwalkar, Mr. Girish Talwalkar and Mr. Prashant Talwalkar through their proprietary undertakings and partnership firms. The other 4 gyms are held by Life Fitness India Private Limited, in which Mr. Madhukar Talwalkar jointly with his wife holds 50% of its outstanding equity share capital.
* The company remits 80% of the franchise fee of Equinox Wellness (67% owned by Denovo Enterprises) to Talwalkars Omnifitness, which is 100% owned by Mr. Madhukar Talwalkar and Mr. Girish Talwalkar.
* The company also remits 100% of the franchisee fee of the franchised health club operating in Vashi and 80% of the franchisee fee of two of the franchised health clubs operating in Nagpur to Talwalkars Omnifitness. Mr. Madhukar Talwalkar also holds 17.5% stake in Pinnacle Fitness, a franchisee that operates two health clubs in NCR, through the shareholding of Life Fitness India. Mr. Madhukar Talwalkar is one of the directors in the Board of Pinnacle Fitness and Life Fitness India.
* There are entities namely a proprietary concern, Talwalkars Nutrition Centre and a partnership firm Fitness India Investments, owned by the promoters, which may have business conflicting with that of the company. Further, Talwalkars Omnifitness and partnership concerns Club Business Systems and Talwalkars Health Commune, which pursuant to acquisition of their business still exist with an object conflicting with that of the company.
Valuation
The company has set a price band of Rs 123 to Rs 128 per equity share of Rs 10 face value. At the lower band of Rs 123 per share, the P/E would be 51.6 times the annualized EPS of Rs 2.4 for the nine months ended December 2009 (on post-IPO equity) and 82 times the EPS of Rs 1.5 (on post-IPO equity) for FY09. At the upper price band of Rs 128 per share, the P/E would be 54 times the annualized EPS for the nine months ended December 2009 and 85 times the EPS for FY09. There is no comparable listed company. The very high valuation already factors in very high growth rates in future.
Market snaps five-day losing streak; volatility index falls
The key benchmark indices registered small gains, snapping loses in the preceding five trading sessions, after the Reserve Bank of India (RBI) announced a small increase in policy rates at a monetary policy review. Firm global stocks supported the domestic bourses. The BSE 30-share Sensex rose 59.90 points or 0.34%, off close to 100 points from the day's high and up close to 66 points from the day's low.
Interest rate sensitive banking, auto and realty stocks rose. But IT stocks fell. Index heavyweight Reliance Industries (RIL) edged higher in volatile trade. The market breadth was strong as a host of small-cap and mid-cap stocks rose.
Investors heaved a sigh of relief after a small hike in short term interest rates and the cash reserve ratio (CRR) by the central bank at its annual policy review. The Reserve Bank of India (RBI) raised repo rate, reverse repo rate and CRR by 25 basis points each. Analysts were expecting a 25 to 50 basis points hike in short term rates and the CRR. The RBI said it will continue to monitor macroeconomic conditions, particularly the price situation closely and take further action as warranted.
The hike in CRR is effective from 24 April 2010 while repo and reverse repo rate hikes are applicable immediately. After the hike, the CRR will increase to 6%, the repo rate to 5.25% and the reverse repo to 3.75%. Repo is the rate at which the central bank lends to banks and reverse repo is the rate at which the central bank absorbs excess cash from the banking system. CRR is the portion of deposits banks must set aside with the RBI.
The RBI said there is need to move in a calibrated manner in the direction of normalising its policy instruments given that the economic recovery is firmly in place. The latest CRR hike will suck out excess liquidity of Rs 12500 crore from the banking system. According the central bank, non-food credit growth is expected at 20% in the year ending March 2011 (FY 2011).
The central bank said it has to do a fine balancing act and ensure that while absorbing excess liquidity, the government borrowing programme is not hampered. Notwithstanding lower budgeted government borrowings for FY 2011, fresh issuance of securities will be 36.3% higher than in the previous year, the central bank said.
The RBI said the economy is recovering rapidly from a slowdown but inflationary pressures, which were triggered by supply side factors, are now developing into a wider inflationary process. The central bank said there in uncertainty about the shape and pace of ongoing global economic recovery.
The central bank expects GDP growth of 8% for the year ending March 2011 (FY 2011) with an upward bias, assuming a normal monsoon this year and sustenance of good performance of the industrial and services sectors on the back of rising domestic and external demand. The quick rebound of the Indian economy in the year ended March 2010 (FY 2010) despite the failure of monsoon rainfall suggests that the Indian economy has become resilient, the RBI said. Growth in FY 2011 is expected to be more broad-based than in FY 2010.
The central bank has pegged headline inflation for end-March 2011 at 5.5%, lower than near double digits in the month of March 2010. According to RBI three major uncertainties cloud the outlook for inflation. First, the prospects of the monsoon in 2010-11 are not yet clear. Second, crude prices continue to be volatile. Third, there is evidence of demand side pressures building up.
Equities were volatile. Stocks pared gains after an early surge triggered by higher Asian stocks. The market moved in a tight range in morning trade ahead of the RBI policy review. The market surged to hit fresh intraday high soon after the RBI's policy statement in mid-morning trade. The market trimmed gains after hitting a fresh intraday high in early afternoon trade. The market pared gains amid intense volatility in mid-afternoon trade.
The focus is on the fourth quarter corporate results and outlook provided by management for the current year. The combined net profit of a total of 76 companies rose 13.7% to Rs 5623 crore on 23.7% rise in net sales to Rs 36378 crore in the quarter ended March 2010 over the quarter ended March 2009.
European stocks rose Tuesday, boosted by positive global earnings news. The key benchmark indices in UK, France and Germany rose by 0.81% to 1.27%.
Asian stocks rebounded on Tuesday, a day after suffering their biggest percentage fall in 10 weeks, as Citigroup's best results since 2007 raised investor optimism about corporate earnings and risk aversion receded. The key benchmark indices in Hong Kong, Indonesia, South Korea, Singapore and Taiwan rose by between 0.59% to 1.31%. But the key benchmark indices in China and Japan fell by between 0.03% to 0.07%.
Trading in US index futures indicated that the Dow could gain 34 points at the opening bell on Tuesday, 20 April 2010.
US markets rose on Monday as investors reassessed the potential damage of the fraud case against Goldman Sachs and earnings optimism grew. Shares of Goldman Sachs recovered following news that the Securities Exchange Commission's decision to press on with charges of fraud against Goldman Sachs was only secured with a 3-to-2 vote, which suggested that the case might not be so strong. The Dow Jones Industrial Average rose 73.59 points or 0.67% to 11092.05. The S&P 500 gained 5.39 points or 0.45% to 1197.52. But, the Nasdaq fell 1.15 points or 0.05% to 2480.11.
Goldman Sachs stock had fallen nearly 13% on Friday, 16 April 2010, after the Securities and Exchange Commission alleged it committed fraud in the structuring and marketing of a debt product tied to subprime mortgages, which cost investors more than $1 billion.
Back home, the monsoon holds key. Good rains this year after last year's drought will boost farm output and rural incomes. But another monsoon failure will add to inflationary pressure which in turn may hamper the current strong economic rebound. The June-September monsoon season is important for India as about 60% of the country's farmlands are rain-fed and more than half of the workforce is employed in the agriculture sector.
Tokyo-based Research Institute for Global Change has predicted normal monsoon rains in India for the current year. Agriculture secretary P K Basu said in a media interview on Monday, 5 April 2010, that early signs indicate normal monsoon rains this year. The Indian Meteorological Department (IMD) issues a monsoon forecast, usually in the second half of April after considering weather observations in different parts of the world and extrapolating statistical data.
A weakening El Nino is a positive sign for the monsoon, Ajit Tyagi, director general at the India Meteorological Department, had said on 18 March 2010.
The BSE 30-share Sensex rose 59.90 points or 0.34% to 17,460.58. The index fell 6 points at the day's low of 17,394.68 in early trade. The Sensex rose 159.41 points at the day's high of 17,560.09 in afternoon trade.
The Sensex had shed 532.46 points or 2.96% in five sessions to 17400.68 on Monday, 19 April 2010, from a recent high of 17,933.14 on 9 April 2010.
The S&P CNX Nifty gained 26.45 points or 0.51% to 5230.10. NSE's volatility index India VIX tumbled after a recent sharp rise. The index lost 7.9% to 20.87. India VIX is a measure of the market's expectation of volatility over the next 30 calendar days. The index is calculated based on the S&P CNX Nifty options prices.
The BSE Mid-Cap index rose 1.39% and the BSE Small-Cap index rose 1.58%. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market was strong. On BSE, 2088 shares advanced as compared with 785 that declined. A total of 94 shares remained unchanged.
Most sectoral indices on BSE gained. The BSE Realty index (up 3.08%), Bankex (up 1.53%), PSU index (up 1.48%), Auto index (up 1.19%), Capital Goods index (up 0.98%), Power index (up 0.80%), Oil & Gas index (up 0.54%), Healthcare index (up 0.41%), Consumer Durables index (up 0.4%) and Metal index (up 0.38%), outperformed the Sensex.
The FMCG index (up 0.11%), Teck index (down 1%) and IT index (down 1.28%), underperformed the Sensex.
From the 30 share Sensex pack, 19 stocks rose while the rest declined.
BSE clocked turnover of Rs 4532 crore, higher than Rs 3972.85 crore on Monday, 19 April 2010.
Index heavyweight Reliance Industries (RIL) rose 0.18% to Rs 1063.90. The stock was volatile. The scrip hit a high of Rs 1079.30 and the low of Rs 1055. RIL is seen reporting strong Q4 March 2010 results on 23 April 2010.
RIL on 9 April 2010 said the company will pay $1.7 billion to form a joint venture at one of the most promising natural gas deposit regions in the US with Atlas Energy, becoming the latest foreign company to invest in shale plays that are expected to be very lucrative. The firm will pick up a 40% stake in Atlas's operations in the booming Marcellus Shale, a gas project that spans parts of Pennsylvania, West Virginia and New York in the United States and which, according to some geologists, could hold enough natural gas to satisfy US demand for a decade.
Rate sensitive auto stocks jumped after the RBI's policy statement. Vehicle sales in India should grow 10-15% in the fiscal year to March 2011, an industry body said on 9 April 2010. In 2009/10, a total of 1.23 crore vehicles were sold in the country, up 26.4% from the previous fiscal year, data from the Society of Indian Automobile Manufacturers (SIAM) showed.
India's top small car maker by sales, Maruti Suzuki India rose 1.63%. The company recently raised prices of its vehicles across different models due to higher input costs and expenses from the introduction of the new Bharat Stage IV emission norms.
India's largest tractor maker by sales Mahindra & Mahindra rose 1.41%. Mahindra & Mahindra said on 16 April 2010 that it is buying out Renault's stake in a joint venture that makes the Logan sedan. The Renault name and logo will continue to be used on the Logan till the end of calendar 2010, the company said in a statement.
India's largest commercial vehicle maker by sales Tata Motors gained 2.13%. The company said on Thursday 15 April 2010 that its global vehicle sales rose 39% to 101,712 units in March 2010 over March 2009.This includes sales of UK-based Jaguar and land Rover brands that rose 43% to 23,538 vehicles in March 2010 over March 2009
India's second largest bike maker by sales Bajaj Auto rose 3.25%. Bajaj Auto on Friday, 16 April 2010 said it has raised its stake in KTM Power Sports AG, Europe's second largest motorcycle maker.
But, motorbike maker Hero Honda Motors fell 2.39%, reversing initial gains on profit taking. Net profit jumped 48.8% to Rs 598.81 crore on 19.6% rise in total income to Rs 4191.81 crore in Q4 March 2010 over Q4 March 2009. The company announced the results after trading hours on Monday.
Hero Honda managing director and CEO Pawan Munjal said factors like movement in commodity prices, inflation and interest rate scenario will play a crucial role in the growth and profitability of the two-wheeler industry, going ahead. He said Hero Honda has set ambitious milestones for the current year after vehicle sales surpassed the company's target in the year ended March 2010 (FY 2010).
He said the company is looking forward to a series of defining initiatives in the year ending March 2011 (FY 2011), including aggressively expanding geographical reach, building on production capacities and augmenting strong brand portfolio.
Most carmakers increased vehicle prices from 1 April 2010 after 13 cities across the country switched over to Bharat Stage IV emission norms. Earlier in February 2010, following the 2% increase in excise duty on all non-oil products to 10% in the Budget, auto players had hiked prices of vehicles by up to Rs 70,000.
Automobile firms are seen reporting strong Q4 results on a healthy volume growth. However, the sector is witnessing a headwind of rising input costs. Recently, Maruti Suzuki raised car prices due to a surge in input costs and shift to new emission norms from 1 April 2010. M&M, too, hiked utility vehicles prices recently.
Realty majors surged after the Reserve Bank of India kept risk weightage on loans to commercial real estate sector unchanged at its annual monetary policy review today. Mahindra Lifespace Developers, Unitech, Sobha Developers, Ansal Properties and Infrastructure, Peninsula Land, Indiabulls Real Estate and DLF rose between 3.15% to 4.87%. A section of the market was expecting the Reserve Bank of India to raise the risk weightage on loans to commercial real estate to prevent asset bubbles.
Banking majors rose after RBI raised the key short term interest rates by 25 basis points. India's largest bank by net profit and branch network State Bank of India rose 3.26%. Among other PSU banks, Bank of India rose 2.68%. But, Bank of Baroda and Punjab National Bank, fell by between 0.19% to 0.26%.
India's largest private sector bank by net profit ICICI Bank rose 1.49%. But, India's second largest private sector bank by net profit HDFC Bank fell 0.11%, reversing early gains.
Axis Bank rose rose 2.51% as net profit jumped 31.54% to Rs 764.87 crore in Q4 March 2010 over Q4 March 2009.
India's largest mortgage finance firm by total income Housing Development Finance Corporation (HDFC) rose 0.33% to Rs 2700.90. The stock hit a high of Rs 2715.90 and a low of Rs 2668. The company, last week, launched a Dual Rate Product-2 (DRHL-2) in which home loan interest rates will be fixed rate at 8.25% annually up to 31 March 2011, 9% for the period between 1 April 2011 and 31 March 2012, and the applicable floating rate for the balance term. The offer is for loan application made before 30 April 2010 and at least part-disbursement taken before 30 June 2010.
The Reserve Bank of India said recently banks would determine their lending rates with reference to the base rate, effective 1 July 2010. To stabilise the system of base rate calculation, banks are allowed to change the benchmark and methodology anytime
India's largest information technology services provider by sales, TCS, fell 2.74% on profit taking, reversing early gains. The company posted 9.7% growth in consolidated net profit as per Indian accounting standards to Rs 2,001 crore on 1.17% rise in revenues to Rs 7738 crore in Q4 March 2010 over Q3 December 2009. The result was announced after the market hours on Monday.
TCS chief executive officer and managing director N Chandrasekaran said the company's sales and execution machine is primed and the company has laid a solid platform for growth. There is a significant traction for TCS' strategy of full services which together with TCS' global engagement model positions the company well for accelerated growth, Chandrasekaran said.
Among other IT majors, India's second largest software exporter by sales Infosys Technologies fell 0.99%. India's third largest software services exporter by sales Wipro fell 1.27%. The company will announce its Q4 result on Friday, 23 April 2010.
ARSS Infrastructure Projects clocked a highest turnover of Rs 281.73 crore on BSE. State Bank of India (Rs 149.75 crore), Unitech (Rs 119.57 crore), Tata Steel (Rs 89.16 crore) and Reliance Industries (Rs 81.26 crore), were the other turnover toppers on BSE.
FCS Software Solutions reported a highest volume of 3.04 crore shares on BSE. Cals Refineries (1.78 crore shares), Unitech (1.45 crore shares), Development Credit Bank (83.93 lakh shares) and Birla Power Solutions (73.02 lakh shares), were the other volume toppers on BSE.
Talwalkars Grey Market Premium
| Company Name | Offer Price (Rs.) | Premium (Rs.) |
| Talwalkars Better Value Fitness Ltd. | 123 to 128 | Discount |
| Nitesh Estate | 60 to 65 (Approximate) | -- |
| Tarapur Transformers | 65 to 75 | -- |
| Sutlaj Jal Vidhut Nigam (SJVNL) | -- | 3 to 3.50 |
Copper ends on a weak mode
Prices continue to drop due to economic concerns
Copper prices ended lower at Comex on Monday, 19 April 2010. Though prices recovered from intra day lows, negative news regarding Goldman Sachs continued to weigh on commodities during the whole day. The strong dollar added further woes. Stronger than expected economic data helped lift prices also.
At USA, copper futures for July delivery ended lower by 1.75 cents (0.5%) at $3.518 a pound on Monday. During intra day trading, prices fell to a low of $3.4725. Last week, prices lost 1.5%. In March, copper gained 7.5%. Copper gained about 6% for the first quarter, buoyed by data from the U.S. and other countries reinforced expectations that the global economic recovery was on track. On a year to date basis, in 2010, copper is higher by 4.1%.
Prices have increased by almost 67% in the past twelve months due to higher imports from China. Copper ended FY 2009 higher by 140%.
On Monday, at LME, copper for delivery in three months ended lower by $65 (0.8%) at $7,695. Prices had crossed the $8,000 mark for first time since 2008 last Tuesday, 6 April. On 3 July, 2008, prices had touched an all time intra day high of $8,940.
Wall Street was stunned on Friday after news hit the wires that the U.S. Securities and Exchange Commission has filed a civil suit accusing Goldman Sachs and one of its vice presidents of defrauding investors in connection with a mortgage derivative. As per reports, a key focus of these worries may be Paulson & Co., which is enmeshed in a SEC lawsuit against Goldman Sachs but hasn't been charged. The hedge fund giant is one of the world's biggest investors in gold. If Paulson investors try to redeem from the firm's hedge funds, the firm might be forced to unwind some of its gold positions, pressuring prices.
In the currency market on Monday, the dollar index, which measures the strength of the dollar against basket of six other currencies rose by 0.13%.
Among economic reports for the day, The Conference Board on Monday said the slow economic recovery should continue over the next few months, which also helped several commodities pare some of its losses. The index of leading economic indicators rose 1.4% in March, marking 12 consecutive gains, following an upwardly revised increase of 0.4% in February.
Copper ended substantially higher last year on expectations of revived global economic growth along with a decline in the dollar. The dollar index had dropped almost 4.2% last year. The metal was also pushed higher by record first-half imports to China, the world's largest user.
The U.S. buys about 13% of the 17 million metric tons of copper sold annually and China buys about 20%.
At the MCX, copper for April delivery closed lower by Rs 1.3 (0.37%) at Rs 344.8/Kg. Prices rose to a high of Rs 345.9/Kg and fell to a low of Rs 340.2/Kg during the day's trading.
Among other metals traded in the LME on Monday, lead ended 5.2% lower at $2,240 a ton and zinc ended 3.8% lower at $2,400 a ton. Nickel ended 0.4% higher at $26,925. Aluminum ended 2.9% lower at $2,394 a ton.
Positive start likely; RBI’s policy in focus
Headlines for the day:
Mining firms ride the profit boom
ArcelorMittal eyes stake in Ferro Alloys Corp
JSW acquires control of South African coal mining company
Events for the day:
Major corporate action
RBI’s quarterly monetary policy review today
Ex-date for Interim dividend of Nissan Copper
Results: GTL, Axis Bank, Zee Entertainment, HCL
For more events, log on to Sharekhan.com
Pre-market report
Global signals
The European equities ended lower on Monday, with banking stocks falling on Friday's fraud charges against Goldman Sachs and airlines slipping on a fifth day of cancellations due to volcanic ash.
The US stocks rose late on Monday as investors reassessed the potential damage of the fraud case against Goldman Sachs and earnings optimism grew.
In today's trade, the Asian markets were trading on a positive note, except Shanghai Composite. At the time of writing this report, SGX Nifty was trading 7.5 points higher.
Indian markets
The Indian Indices are likely to open on a higher note on the back of positive Asian cues and as the investor sentiment across the globe turned good on hopes of better earnings declaration. Yesterday, post the market, Hero Honda and Tata Consultancy Services (TCS) announced their Q4 numbers, which were above the street expectations. Thus, we might see some momentum in these stocks.
However, going in the session, the results of HCL Technologies, Axis Bank, GTL are to be announced later by the day, which might affect the future course of the day. We expect the market to remain volatile as the case in the previous last five sessions, as investors will keenly look forward to the Reserve Bank of India (RBIs)' monetary policy, which is scheduled later today. The street expects a 25-50 basis points hike in interest rates.
Commodity cues
In the commodity space, the crude oil prices tumbled on Monday for the third straight trading day as investors reacted to the fraud charges against Goldman Sachs and the strength of the dollar, with the Nymex light crude oil for the May series declined by $1.79 per barrel, whereas in the metals space, the Comex Gold for the May series down by $1.10 and the Comex Silver for the May series was declined by $0.05 to a troy ounce respectively.
Daily trend of FII/MF investment in equities
On April 19, 2010, the FIIs were the net buyers of the Indian stocks to the tune of Rs363.70 crore, whereas the domestic mutual funds, on April 16, 2010, were the net sellers of the stocks to the tune of Rs292.90 crore
Market may open higher on firm Asian stocks; RBI`s policy review eyed
Stocks may recover from losses in the preceding five trading days on higher Asian stocks. The Reserve Bank of India (RBI)'s of annual monetary policy statement for 2010/11 which is due at 11:15 IST today, 20 April 2010, may set the tone for the day. Trading in S&P CNX Nifty index futures on the Singapore stock exchange indicated that the Nifty could gain 7.50 points at the opening bell. The Reserve Bank of India is seen raising key short term interest rates by 25 to 50 basis points at a policy review today. The central bank is also expected to raise the cash reserve ratio to suck out excess liquidity from the banking system.
Among key results, Tata Consultancy Services (TCS), India's largest information technology services provider by sales, posted 9.7% growth in consolidated net profit as per Indian accounting standards to Rs 2,001 crore on 1.17% rise in revenues to Rs 7738 crore in Q4 March 2010 over Q3 December 2009. The result was announced after the market hours on Monday.
Motorbike maker Hero Honda Motors after market hours on Monday announced its net profit rose 48.8% to Rs 598.81 crore on 19.6% rise in total income to Rs 4191.81 crore in Q4 March 2010 over Q4 March 2009.
The RBI said on Monday, 19 April 2010, that the weight of monetary policy balance may have to shift to containing inflation since high inflation itself will dampen recovery in growth. The central bank in its document Macroeconomic and Monetary Developments in 2009-10 which serves as a background to the monetary policy statement 2010-11, said monetary policy management in 2010-11 will be dominated by the challenge of moderating inflation and anchoring inflation expectations, while remaining supportive of growth impulses. The Reserve Bank of India's survey of professional forecasters suggests a median GDP growth for 2010-11 at about 8.2%.
Though inflation is expected to moderate in the next few months from near-10% levels seen recently, upside risks remain, the RBI said. The latest data showed the wholesale prices rose 9.9% in March 2010 from a year earlier and a tad higher than February's annual rate of 9.89%.
Rising inflation remains a key cause for concern. A sharp surge in interest rates may adversely impact private investment demand as well as the proposed large scale investment in the infrastructure sector.
The RBI had raised the cash reserve ratio (CRR) for banks by a more-than-expected 75 basis points in January 2010 and followed it with a between-meeting surprise 25 basis point increase in the key repo and reverse repo rates in March 2010.
Net capital inflows in India can be expected to increase further during the current year reflecting the prospects of higher growth and larger interest rate differentials between India and the advanced economies, RBI said on Monday. Higher capital inflows could influence asset prices, domestic liquidity conditions and the exchange rate, the central bank said. This will have implications for monetary management, it added.
Coming back to stocks, the focus is on the fourth quarter results and outlook provided by management for the current year. The combined net profit of a total of 72 companies rose 5.4% to Rs 4651 crore on 23% rise in net sales to Rs 34436 crore in the quarter ended March 2010 over the quarter ended March 2009.
Asian stocks rose on Tuesday, led by finance companies, as regulators were split on suing Goldman Sachs Group Inc., easing concern over the impact increased regulation on banks. The key benchmark indices in Hong Kong, Japan, Indonesia, South Korea, Singapore and Taiwan rose by between 0.25% to 0.76%. But, China's Shanghai Composite fell 0.52%.
US markets rose on Monday as investors reassessed the potential damage of the fraud case against Goldman Sachs and earnings optimism grew. Shares of Goldman Sachs recovered following news that the Securities Exchange Commission's decision to press on with charges of fraud against Goldman Sachs was only secured with a 3-to-2 vote, which suggested that the case might not be so strong. The Dow Jones Industrial Average rose 73.59 points or 0.67% to 11092.05. The S&P 500 gained 5.39 points or 0.45% to 1197.52. But, the Nasdaq fell 1.15 points or 0.05% to 2480.11.
Goldman Sachs stock had fallen nearly 13% on Friday after the Securities and Exchange Commission alleged it committed fraud in the structuring and marketing of a debt product tied to subprime mortgages, which cost investors more than $1 billion.
In earnings watch, Citigroup blew past earnings and revenue expectations. In economic news, leading indicators jumped 1.4% to a record high in March 2010, after an upwardly revised 0.4-percent increase in February.
Daily News Roundup - Apr 20 2010
The Government is considering divesting 10% stake in the state-owned National Aluminium Company (NALCO). (BS)
L&T to bid for airport projects in West Asia. (BL)
ArcelorMittal in talks with Delhi-based Ferro Alloys Corporation (Facor) for a strategic stake. (BS)
BHEL has bagged contract of Rs63bn from Raichur Power Corporation Ltd’s for setting up a 1,600 mw supercritical power plant in Karnataka. (FE)
GMR group is planning to raise an additional US$100mn from a group of private equity companies, led by Singapore-based Temasek Holdings, to fund its expansion plans. (BS)
Siemens to invest Rs5bn for wind turbine manufacturing facility in Gujarat. (BS)
Bajaj Auto has increased its stake in Austrian power bike maker KTM further to 35.7% from present 31.9%. (FE)
Cipla has developed three low-cost generic medicines to treat blood pressure, allergic rhinitis and control excessive bleeding in women during delivery. (BS)
United Spirits plans to expand into Southeast Asia and Africa by buying distilleries as it seeks to bolster its position as the world’s second-biggest seller of alcohol. (ET)
JSW has beaten two South African bidders to acquire a majority stake in South African Coal Mining Holdings (SACMH) at a price of 85.4mn rand (~Rs511.6mn). (BS)
Coal India Limited (CIL) has fallen short of its targeted coal supplies to consumers in sectors like power, steel and fertilizers during April-February 2009-10. As against the 281.8mn tons which was to be supplied by CIL to the power sector, the coal major managed to supply 270.2mn tons, thus falling short of the target by 4.1%.(BS)
Philips has outsourced its entire TV business, including manufacturing, distribution and selling, to Videocon industries. (BS)
Shree Renuka Sugars has been insisting for at least 8% more equity in the Brazilian firm, Equipav. (ET)
Jay Shree Tea & Industries is close to acquiring tea estates in Uganda and Rwanda. This overseas acquisition is expected to lift production from 23.5mn kg to nearly 29mn kg in 2010-11. (ET)
Coal India is expected to seal deals worth US$1.8bn with foreign firms in the next two months for mining coal abroad (ET)
The government would rake in a minimum of over Rs240bn from the auction of third generation (3G) spectrum on the eighth day as the pan-India licence reached a bid of Rs60.7bn, up by about 73% from the base price of Rs35bn. (BS)
Government has managed to add over Rs96.5bn in 2009-10 as non-tax revenue from the oil exploration companies. (BS)
The sugar production in Uttar Pradesh for the 2009-10 crushing season is likely to fall short of 5.2mn tons as earlier projected. (BS)
Credit growth surpassed the RBI's projection of 16% in FY10 mainly on account of public sector banks reporting robust growth in lending. (BL)
A key committee of Parliament has said that the proposed Financial Stability and Development Council (FSDC) should be constituted at the earliest to address the inter-regulatory issues in the financial sector, creating pressure on the government to make the council some sort of a super regulator. (ET)
More or less accepted!
Peace of mind is that mental condition in which you have accepted the worst. -Lin Yutang.
Quarterly numbers, global events and of course the RBI’s annual policy will keep the Indian market on tenterhooks. Can the market find some peace of mind? The spotlight will be on banks as the RBI is all set to raise rates (and perhaps even CRR) to tame inflation. The central bank’s commentary will have a bearing on sentiment. But, the fact that the markets have already discounted rate hikes and the key indices have come off the two-year highs could lead to a bounce back.
The Goldman Sachs shock appears to have eased a bit for the time being. The focus will be on the Wall Street titan’s results later today. Citigroup shares rallied after posting strong earnings. But IBM shares are down despite stellar set of numbers.
The IT space will be in focus back home after TCS came out with better-than-expected Q4 results. Liquidity is a key variable and one needs to keep a close watch on fund flows.
We expect a flat to slightly positive start. Overall, things will be volatile with a possibility of a higher finish if the RBI doesn't spring a nasty surprise and there is no fresh external shock.
Hero Honda and Sesa Goa may hog some limelight after announcing their results post market on Monday.
Results Today: Axis Bank, BILT, BOC India, Great Offshore, GTL, HCL Tech, Jindal Saw and Zee Entertainment.
Zee Entertainment could remain in focus on market buzz of a bonus.
FIIs were net sellers of Rs7.55bn on Monday on a provisional basis. Local funds were net buyers at Rs5.7bn, according to figures published on the NSE's web site. In the F&O segment, the foreign funds were net sellers of Rs1.48bn. On Friday, FIIs were net buyers of Rs3.64bn in the cash segment, as per the SEBI web site.
India stocks extended their losing streak to a fifth straight trading session on Monday as global markets sold off in the wake of the Goldman Sachs fraud. Sentiment was also hit after sharp losses in the Chinese market where property shares took a big hit in the wake of last week’s government clampdown.
US stocks snapped a six-day wining streak on Friday after the Securities and Exchange Commission (SEC) slapped a civil law suit on Goldman Sachs for duping investors to the tune of US$1bn. The mood remained cautious ahead of the RBI annual policy meet tomorrow. Consensus forecast is for a 25bps hike in key policy rates and a 50bps increase in the CRR.
Few weeks ago we were heading towards the 5400 and 5500 levels on the NSE Nifty. However, all of a sudden the tide seems to have turned against the bulls. The BSE Sensex has lost over 500 points and the Nifty 150 points in the last five sessions. Today, the Nifty managed to end above the 5200 mark, thanks to a late recovery in index heavyweights like Hindalco, HDFC and Bharti Airtel.
The BSE Sensex fell 191 points to end at 17,400 and NSE Nifty lost 59 points to close at 5,204. Among the 30 components of Sensex, 24 ended in the negative terrain and 6 were in the green.
Markets in Asia ended in the red; the Nikkei in Japan was down 1.8%, Australia's S&P/ASX fell by 1.5%. Shanghai SE Composite lost 4.8% and Hang Seng index in Hong Kong was down 2.1%.
On the other hand, European indices were also trading with negative bias, the DAX in Germany was down 0.5%, the CAC 40 index in France was down 0.7% and the FTSE in the UK was down 0.5%.
Coming back to India, among the BSE sectoral indices, the BSE Realty index was top loser, the index lost 2.5%, followed by BSE Metal index down 2.1% and Oil & Gas index down 2%.
Even the Mid-Cap and the Small-cap index ended in the red, both the indices lost 1% and 1.5% respectively.
Outside the frontline indices, the big losers in the broader market were Jet Airways, GMR Infra, Renuka Sugar and Jai Corp. On the other hand, gainers included Jain Irrigation, Allahabad Bank, Godrej Consumers and Sterling Bio.
Shares of Godrej Consumer gained by 3% to end at Rs320 after reports stated that company is in talks to acquire Issue Group Co., an Argentine company that makes hair coloring. The scrip opened at Rs311 it touched an intra-day high of Rs331 and a low of Rs307 and recorded volumes of over 0.16mn shares on BSE.
Shares of Jet Airways declined by over 6.5% to end at Rs502 after the airliner canceled flights between London and India over the weekend after volcanic eruptions in Iceland created an ash cloud across large areas of Europe disrupting the route. The airliner used different routes to North America.
M&M reportedly agreed to take over partner Renault SA’s 49% stake in a venture as the Renualt separately seeks to expand operations. Mahindra Renault Pvt. will now be 100% owned by M&M. The stock ended flat at Rs503. The scrip opened at Rs498 it touched an intra-day high of Rs509 and a low of Rs491 and recorded volumes of over 0.28mn shares on BSE.
Shares of Amtek Auto slumped by over 5% to end at Rs183 after ~1.6% of equity changed hands in single block. The scrip opened at Rs190 it touched an intra-day high of Rs193 and a low of Rs179 and recorded volumes of over 6.1mn shares on BSE.
FIIs continue buying
Inflow of Rs 363.70 crore on 16 April 2010
Foreign institutional investors (FIIs) bought shares worth a net Rs 363.70 crore on Friday, 16 April 2010, slightly higher than Rs 343.10 crore on Thursday, 15 April 2010.
FII inflow of Rs 363.70 crore on 16 April 2010 was a result of gross purchases Rs 2519 crore and gross sales Rs 2155.30 crore. There was an inflow of Rs 334.30 crore into secondary equity markets which was a result of gross purchases Rs 2481.90 crore and gross sales Rs 2147.60 crore. The BSE Sensex fell 48.08 points or 0.27% to 17,591.18 on that day.
There was an inflow of Rs 29.40 crore in the category 'primary market & others', which was a result of gross purchases Rs 37.10 crore and gross sales Rs 7.70 crore.
FII inflow in April 2010 totaled Rs 5,427.50 crore (till 16 April 2010). FIIs had bought equities worth Rs 19,928.20 crore in March 2010. FII inflow in the calendar year 2010 totaled Rs 26,071.90 crore (till 16 April 2010).
There are a total of 1,706 foreign funds registered with the Securities & Exchange Board of India (Sebi).
Talwalkars Better Value Fitness IPO opens on 21 April 2010
Rs 123-Rs 128 per share IPO price band
Talwalkars Better Value Fitness, an operator of fitness centers, will come out with an initial public offer (IPO) on 21 April 2010. The price band for the IPO is set at Rs 123 - Rs 128 per share. Bids for the issue will close on 23 April 2010. The offer consists of a fresh issue of 60.5 lakh shares of the face value Rs 10 each.
Out of the issue proceeds, around Rs 50 crore are to be used for setting up of additional health clubs, Rs 20 crore for repaying certain unsecured loans and remaining for meeting the issue related expenses.
The company owns one of the largest and oldest fitness chains in India. The company (as of December 2009) owned 37 health clubs and operated 14 more through franchisee route across 24 cities in 11 states across the country. The company's health clubs offer a suite of standardised services like gym, spa, aerobics and health counselling under the brand name 'Talwalkars'.
Nagarjuna Construction Company
Investors with a short-term trading perspective can sell the stock of Nagarjuna Construction Company. The stock faces strong medium-term resistance at Rs 185 and it has failed to move past it despite multiple attempts to breach this level since last October. The stock reversed lower from the peak of Rs 185 on April 9 and it has been in a down-trend since then.
The stock's down-move has accelerated over the past three sessions and it has lost 7 per cent in this period. The daily momentum indicators have moved into the neutral zone from bullish territory. The 10-day rate of change oscillator is on the brink of moving into the bearish zone while the moving average convergence oscillator is about to signal a sell. The stock could move lower to Rs 162 or Rs 155 in the days ahead. Short-term investors can sell the stock with stop at Rs 173.
Traders can consider shorting the near month future of Nagarjuna Construction with the stop at Rs 171.5 and the targets of Rs 164.5 and Rs 162.
Yellow metal ends marginally lower
Mixed end for precious metals as silver manages to climb up
Yellow metal prices ended lower on Monday, 19 April 2010. Though prices recovered from intra day lows, negative news regarding Goldman Sachs continued to weigh on commodities during the whole day. The strong dollar added further woes. But silver prices managed to end marginally higher.
Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa.
On Monday, gold for June delivery ended at $1,135.8 an ounce, lower by $1.1 (0.1%) an ounce on the New York Mercantile Exchange. During intra day trading, gold fell to a low of $1,124.3 and rose to a high of $1,138.5. Last week, gold ended lower by 2.5%. For the month of March, gold slid 0.4%. For the first quarter of this year, gold rose by 1.7%, its sixth quarterly rise. On a year to date basis, gold is higher by 3.7%.
On Monday, May Comex silver futures ended higher by 6 cents (0.3%) at $17.73 an ounce. Last week, silver lost 3.7%. For the month of March, silver ended higher by 5%. For the first quarter of this year, silver rose by 3%. On a year to date basis, silver is higher by 4.3%.
Wall Street was stunned on Friday after news hit the wires that the U.S. Securities and Exchange Commission has filed a civil suit accusing Goldman Sachs and one of its vice presidents of defrauding investors in connection with a mortgage derivative. As per reports, a key focus of these worries may be Paulson & Co., which is enmeshed in a SEC lawsuit against Goldman Sachs but hasn't been charged. The hedge fund giant is one of the world's biggest investors in gold. If Paulson investors try to redeem from the firm's hedge funds, the firm might be forced to unwind some of its gold positions, pressuring prices.
In the currency market on Monday, the dollar index, which measures the strength of the dollar against basket of six other currencies rose by 0.13%.
Among economic reports for the day, The Conference Board on Monday said the slow economic recovery should continue over the next few months, which also helped several commodities pare some of its losses. The index of leading economic indicators rose 1.4% in March, marking 12 consecutive gains, following an upwardly revised increase of 0.4% in February.
Gold had ended FY 2009 higher by 24%. Silver futures had ended 2009 up 50%. The dollar index had lost 4.2% against its counterparts last year.
Last year, after hitting a low at $807.30 per ounce on 15 January 2009, gold futures rallied almost 51% to hit an all-time high at $1217.40 per ounce during early December of 2009 but fell from those levels at the end. Silver futures had hit a low at $10.42 on 15 January 2009 and hit a high at $19.30 per ounce on 2 December 2009. Like gold, silver also ended lower than its all time high level.
At the MCX, gold prices for June delivery closed higher by Rs 4 (0.02%) at Rs 16,613 per ten grams. Prices rose to a high of Rs 16,640 per 10 grams and fell to a low of Rs 16,471 per 10 grams during the day's trading.
At the MCX, silver prices for May delivery closed Rs 67 (0.24%) higher at Rs 27,112/Kg. Prices opened at Rs 27,034/kg and rose to a high of Rs 27,146/Kg during the day's trading.
Crude plunges
Prices shed almost 2% as worries in financial sector continue
Crude oil prices ended substantially lower at Nymex on Monday, 19 April 2010. Negative news regarding Goldman Sachs that rocked Wall Street on Friday continued to haunt investors. The strong dollar added further woes.
On Monday, crude-oil futures for light sweet crude for June delivery closed at $83.04/barrel (lower by $1.62 or 1.9%). Earlier in the day, it fell to a low of $80.53. Last week, crude ended lower by 1.2%. For the month of March, crude rose 5.1%. For the first quarter of this year, crude rose by 5.5%. Year to date, crude is higher by 3.5%.
Prices are still very much lower as compared to 3 July, 2008 settlement of $145.29 a barrel and an intraday high of $147.27 on 11 July, 2008, an all-time high. However, oil has also gained nearly 155% from a December 2008 nadir. That day prices settled at $33.87 a barrel following an intraday low of $32.40.
Wall Street was stunned on Friday after news hit the wires that the U.S. Securities and Exchange Commission has filed a civil suit accusing Goldman Sachs and one of its vice presidents of defrauding investors in connection with a mortgage derivative. As per reports, a key focus of these worries may be Paulson & Co., which is enmeshed in a SEC lawsuit against Goldman Sachs but hasn't been charged. The hedge fund giant is one of the world's biggest investors in gold. If Paulson investors try to redeem from the firm's hedge funds, the firm might be forced to unwind some of its gold positions, pressuring prices.
In the currency market on Monday, the dollar index, which measures the strength of the dollar against basket of six other currencies rose by 0.3%.
Among economic reports for the day, The Conference Board on Monday said the slow economic recovery should continue over the next few months, which also helped several commodities pare some of its losses. The index of leading economic indicators rose 1.4% in March, marking 12 consecutive gains, following an upwardly revised increase of 0.4% in February.
In the latest monthly report, the Organization of the Petroleum Exporting Countries last week left unchanged its forecast for global oil demand in 2010. Consumption is projected to increase by 900,000 barrels a day this year, the oil cartel said in its monthly report.
On Monday, gasoline for June delivery declined 3 cents, or 1.4%, to $2.26 a gallon.
Elsewhere, natural-gas futures reversed course to post losses. Natural gas for May delivery, the most active contract, fell 12 cents, or 2%, to $3.92 per million British thermal units.
Crude ended FY 2009 higher by 78%, the highest yearly gain since 1999. It reached a high of $82 earlier in October 2009 and hit a low of $33.98 on 12 February 2009. Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.
At the MCX, crude oil for April delivery closed lower by Rs 44 (1.23%) at Rs 3,718/barrel. Natural gas for April delivery closed at Rs 175.3/mmbtu, lower by Rs 6 (3.3%).
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