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Thursday, May 13, 2010
Market slides towards fag end
Today's major news
Food inflation inches up to 16.44%
Tata Consultancy Servises ties up with Swiss-based pro-cycling team; the stock rises 0.97%
Educomp Solutions Q4 net profit up 24% yoy; the stock closes 0.89% higher
Click here for more stories
Global signals
European stocks edged higher on the second straight day on Thursday as announcements from Spain and Portugal on the implementation and execution of austerity measures buoyed global sentiment.
Spain announced austerity measures aimed at cutting the country's budget deficit by an additional €15 billion to close to 6% of gross domestic product in 2011 from 11.2% of gross domestic product (GDP) in 2009. Portugal also pledged to cut its budget deficit further than initially planned, aiming for a deficit of 7.3% of GDP in 2009. As of writing of this report, FTSE 100 was trading higher by 0.50%.
All the major Asian indices closed higher except Straits Times that closed marginally lower. Jakarta Composite was closed today. SGX Nifty closed 33 points higher.
US stock futures signal lower opening on the Wall Street. Cisco will be in focus as it posted the earnings above market expectation after the market hours on Wednesday.
Indian indices
Domestic market traded higher on the second day in a row mirroring world equities after Spain and Portugal announced the austerity measures to cut fiscal deficit that eased concerns of euro zone debt to some extent and also buying interest in realty and auto stocks.
Tracking the strong Asian markets, the Sensex opened 58 points higher at 17324 and strengthened its gains till afternoon. The market shrugged off the rising inflation concerns (food inflation rose to 16.44% for week ended May 01, 2010) hitting the day's high of 17389. However, post lunch, the market pared some of its gains after the US index futures reversing gains and European market trimming its initial gains in choppy trade. At finishing line, the Sensex shut at 17266 higher by 70 points and the Nifty quoted 22 points higher at 5179.
Market sentiment
The market breadth - the number of advancing shares to declining shares - was fairly positive. Of the total 2,981 stocks traded on the BSE, 1,746 stocks advanced, whereas 1,126 stocks declined. Hundred and nine stocks closed unchanged
Sectoral & stock screening
Out of the 13 sector indices on the BSE, only BSE Metal and BSE Oil & Gas closed with marginal losses. The remaining indices ended higher. Among gainers, BSE Realty surged the most by 2.50%, followed by BSE Auto that rose by 2.09% for the day.
Among 'A' group stocks: Top gainers were - Godrej Consumer Products surged the most by 13.78% on acquiring the remaining 51% stake in joint venture Godrej Sara Lee, followed by Bajaj Holdings & Investment that rose by 7.71% on its robust Q4 numbers, and Shree Renuka Sugars that jumped 5.64%. Top losers' were - Allahabad Bank topped the losers' list with a loss of 3.59%, followed by Sesa Goa that slid by 2.47%, and Jubilant Organosys that fell by 1.96%.
Viewing volumes
Industrial finance company IFCI was the most actively traded share with over 0.52 crore shares changing hands on the BSE, followed by India's largest telecom operator Bharti Airtel (0.51 crore shares), Anil Dhirubhai Ambani group company Reliance Natural Resources (0.49 crore shares), India's second largest developer Unitech (0.48 crore shares) and sugar major Shree Renuka Sugars (0.39 crore shares).
Sensex ends with modest gains at close
Indian equities continued to gain for the second day on Thursday. The Sensex ended with modest gains today. Midcap index outperformed Smallcap index. Realty, auto, consumer durables and healthcare stocks traded higher, while metal and oil & gas declined. It opened on a strong note at 17,323.63 on back of positive Asian markets. Sustained buying was seen in index heavyweights. The index gained further ground touching a high of 17,389.15. Later it pared gains and came off from early highs to conclude on a positive note.
On global front, European stocks climbed for a second day after SAP announced a USD 5.8 billion acquisition and earnings from J Sainsbury and BT Group beat analysts` estimates. U.S. index futures advanced.
At the close, the benchmark 30-share index, BSE Sensex gained 70.06 points or 0.41% at 17,265.87 with 21 components registering rise. Meanwhile, the broad based NSE Nifty climbed by 22.25 points or 0.43% at 5,178.90 with 35 components posting rise.
Sensex Movers
ICICI Bank contributed rise of 15.14 points in the Sensex. It was followed by Infosys Technologies (13.41 points), Tata Motors (11.34 points), Mahindra & Mahindra (10.52 points) and Oil & Natural Gas Corporation (10.49 points).
However, Reliance Industries contributed fall of 21.52 points in the Sensex. It was followed by Tata Steel (7.21 points), Bharti Airtel (5.72 points), State Bank Of India (3.26 points) and HDFC Bank (3.02 points).
Major gainers in the 30-share index were Tata Motors (3.53%), Mahindra & Mahindra (3.42%), DLF (3.03%), Reliance Energy (2.73%), Jaiprakash Associates (1.99%), and Oil & Natural Gas Corporation (1.74%).
On the other hand, Tata Steel (1.54%), Bharti Airtel (1.11%), Reliance Industries (0.94%), Wipro (0.53%), Hindalco Industries (0.44%), and State Bank Of India (0.38%) were the biggest losers in the Sensex.
Mid & Small-cap Space
The BSE Mid and small caps outperformed their larger counterparts gaining 1.23% and 0.97% respectively.
The major gainers in the BSE Midcap were A I A Engineering (2.97%), Alstom Projects India (2.77%), Allcargo Global Logistics (0.61%), Ackruti City (0.46%) and Alfa-Laval (India) (0.18%).
The major gainers in the BSE Smallcap were A B G Shipyard (11.13%), Action Construction Equipment (1.34%), Provogue (India) (0.99%), Aarti Industries (0.32%) and Adhunik Metaliks (0.04%).
Sectors in Limelight
The Realty index was at 3,373.63, up by 82.14 points or by 2.50%. The major gainers were Indiabulls Real Estate (4.7%), D L F (3.03%), Anant Raj Industries (2.33%), Housing Development and Infrastructure (2.28%) and Ackruti City (0.46%).
The Auto index was at 7,888.87, up by 161.51 points or by 2.09%. The major gainers were Bharat Forge (4.19%), Exide Industries (2.72%), Bajaj Auto (2.45%), Ashok Leyland (1.87%) and Apollo Tyres (1.58%).
The Consumer Durables index was at 4,666.32, up by 60.93 points or by 1.32%. The major gainers were Titan Industries (3.68%), Bajaj Electricals (1.12%), Videocon Industries (0.49%) and Rajesh Exports (0.12%).
On the other hand, the Metal index was at 16,466.13, down by 72 points or by 0.44%. The major losers were Hindalco Industries (0.44%), Hindustan Zinc (0.36%), NMDC (0.19%), Jindal Steel & Power (0.19%) and National Aluminium Company (0.15%).
Market Breadth
Market breadth was positive with 1,758 advances against 1,157 declines.
Value and Volume Toppers
Bharti Airtel topped the value chart on the BSE with a turnover of Rs. 1,335.64 million. It was followed by Bajaj Finserv (Rs. 1,282.47 million), JSW Steel (Rs. 1,051.74 million) and Tata Steel (Rs. 911.87 million).
The volume chart was led by Cals Refineries with trades of over 30.70 million shares. It was followed by Birla Power Solutions (17.69 million), Nitesh Estates (15.40 million) and I F C I (5.22 million).
BSE Bulk Deals to Watch - May 13 2010
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
13/5/2010 532682 ABG Shipyard GKK CAPITAL MARKETS PRIVATE LI B 275000 271.62
13/5/2010 521131 Anjani Fabrics AMBUJA FASHION PVT LTD S 150481 22.50
13/5/2010 531276 Bombay Swad ORANGE MAURITIUS INVETMENTS LTD B 29000 41.50
13/5/2010 531276 Bombay Swad VAKIL PRAVIN KANTILAL H.U.F. S 23500 41.50
13/5/2010 530495 Chhattisgarh Inds ANKITA FINANCIAL SERVICES PRIVATE LTD B 242947 7.70
13/5/2010 530495 Chhattisgarh Inds SARITA NUPUR VYPAAR PRIVATE LIMITED S 185247 7.70
13/5/2010 530495 Chhattisgarh Inds CARAVAN VINIMAY PRIVATE LIMITED S 65000 7.70
13/5/2010 524388 Crazy Infotech RAHUL MAROTRAO SURYAWANSHI B 800000 1.54
13/5/2010 524388 Crazy Infotech NAINA SANJEEV MALHOTRA S 525000 1.54
13/5/2010 531171 Devika Prot MRUNAL AGENCY & FINANCE PVT. LTD. B 56479 31.33
13/5/2010 531171 Devika Prot MRUNAL AGENCY & FINANCE PVT. LTD. S 56110 31.34
13/5/2010 517973 DMC Intl BHARAT GUPTA B 182390 17.53
13/5/2010 517973 DMC Intl OURS TRADING AND HOLDINGS PRIVATE LIMITED B 157690 17.62
13/5/2010 517973 DMC Intl ANJANA GUPTA S 128414 17.52
13/5/2010 517973 DMC Intl OURS TRADING AND HOLDINGS PRIVATE LIMITED S 157450 17.62
13/5/2010 526614 Expo Gas KAMAL KUMAR DUGAR AND CO ( PROP : KAMAL KUMAR DUGAR) B 43159 20.97
13/5/2010 590024 Fert & Chem Trv WALLFORT FINANCIAL SERVICES LTD S 42000 55.32
13/5/2010 532022 Filatex Fash SANJIB KUMAR MONDAL B 50000 10.00
13/5/2010 532022 Filatex Fash NARENDRA KUMAR SURANA B 40000 10.00
13/5/2010 532022 Filatex Fash SANJU KABRA B 110000 10.07
13/5/2010 532022 Filatex Fash RADIANT FINANCIAL SERVICES LIMITED B 50000 10.08
13/5/2010 532022 Filatex Fash ARENA TRADING PRIVATE LIMITED S 50000 10.07
13/5/2010 532022 Filatex Fash NAISHADH INVESTMENT AND FINANCE PRIVATE LIMITED S 40000 10.07
13/5/2010 532022 Filatex Fash SANJU KABRA S 102408 10.02
13/5/2010 532857 Glory Polyfilms SAAKSHI SHARES PVT LTD S 199740 20.48
13/5/2010 523840 Innovative Tech TARA MISHRA B 72568 40.74
13/5/2010 523840 Innovative Tech TARA MISHRA S 53675 40.06
13/5/2010 514312 Jaihind Syn PRASHAM DINISHBHAI DOSHI B 25000 6.36
13/5/2010 522263 JMC Projects OPG SECURITIES P LTD B 114897 202.62
13/5/2010 522263 JMC Projects OPG SECURITIES P LTD S 114897 202.71
13/5/2010 531784 Kadamb Constr ANAND FINSTOCK SERVICES LTD B 82137 46.26
13/5/2010 530479 Kadvani Sec BHARTI JAYSINH NEGANDHI B 114000 8.12
13/5/2010 530479 Kadvani Sec POOJA ANILBHAI GANDHI S 111000 8.12
13/5/2010 530479 Kadvani Sec AMRUTLAL JIVANDAS GANDHI S 74000 8.12
13/5/2010 590084 KANCO ENTER NIRMAL INVESTMENTS B 81920 12.06
13/5/2010 530255 KAY Power BAMPSL SECURITIES LTD B 92393 13.83
13/5/2010 530547 KEN Fin Serv AMBIKA SHYAM SHUKLA B 20272 83.07
13/5/2010 530547 KEN Fin Serv KAMAL M. TIBREWAL S 20000 84.00
13/5/2010 500256 Lok Housing TE DEUM FINANCE AND INVESTMENT PVT LTD S 385000 37.42
13/5/2010 502250 Marathwada Refrac ANILKUMAR MALHOTRA B 5000 356.80
13/5/2010 502250 Marathwada Refrac ABHA DALMIA S 21350 356.80
13/5/2010 590111 MASTER T RAMESH KUMAR B 26350 32.95
13/5/2010 590111 MASTER VENMKATADURGA NAGESWARARAO ATLURI B 33190 33.12
13/5/2010 590111 MASTER SRIKANTH MIKKI LINENI S 28000 33.08
13/5/2010 531942 Millennium Cyb JITENDRA KUMAR RATHI B 25000 5.03
13/5/2010 531942 Millennium Cyb HIRENKIRIT GANDHI B 27204 4.98
13/5/2010 531942 Millennium Cyb SANTOSH ABHAYRAJ SHUKLA S 45000 5.02
13/5/2010 531083 Nihar Info ALLURI PRASADRAJU B 46500 3.98
13/5/2010 531083 Nihar Info VENKATA SIVA GANGADHRA RAO P S 32000 3.98
13/5/2010 533202 NITESH EST GENUINE STOCK BROKERS PVT. LTD. B 1417370 51.49
13/5/2010 533202 NITESH EST CROSSEAS CAPITAL SERVICES PRIVATE LIMITED B 1044882 51.45
13/5/2010 533202 NITESH EST OPG SECURITIES P LTD B 1179264 51.40
13/5/2010 533202 NITESH EST GENUINE STOCK BROKERS PVT. LTD. S 1417370 51.44
13/5/2010 533202 NITESH EST CROSSEAS CAPITAL SERVICES PRIVATE LIMITED S 1044882 51.04
13/5/2010 533202 NITESH EST OPG SECURITIES P LTD S 1179264 51.36
13/5/2010 531496 Omkar Overseas FALGUNIBEN MAHAVIRBHAI GOHIL B 31700 64.41
13/5/2010 512097 Oregon Comm J M SONI CONSULTANCY B 21077 264.35
13/5/2010 512097 Oregon Comm SHRIPAL SHESHMAL HUF B 5821 269.60
13/5/2010 512097 Oregon Comm AMUL G DESAI B 16000 270.12
13/5/2010 512097 Oregon Comm MUKESH KISHANCHAND HUF B 5000 270.00
13/5/2010 512097 Oregon Comm KISHANCHAND CHANOMAL HUF B 5000 270.00
13/5/2010 512097 Oregon Comm KRUNALGOPAL DASRANA B 32920 270.55
13/5/2010 512097 Oregon Comm AMUL GAGABHAI DESAI B 15702 270.62
13/5/2010 512097 Oregon Comm JIMISH JITENDRABHAI SONI B 5511 267.48
13/5/2010 512097 Oregon Comm J M SONI CONSULTANCY S 21077 268.57
13/5/2010 512097 Oregon Comm KRUNAL GOPALDAS RANA S 9300 270.46
13/5/2010 512097 Oregon Comm DHIRENKUMAR DHARAMDAS AGARWAL S 11000 271.03
13/5/2010 512097 Oregon Comm KRUPA SANJAY SONI S 32384 271.00
13/5/2010 512097 Oregon Comm SHRIPAL SHESHMAL HUF S 5821 265.48
13/5/2010 512097 Oregon Comm KRUNALGOPAL DASRANA S 7045 271.46
13/5/2010 512097 Oregon Comm RAHUL MAROTRAO SURYAWANSHI S 5000 270.00
13/5/2010 512097 Oregon Comm KRUNAL GOPALDAS RANA S 9002 259.00
13/5/2010 530923 Passari Cellu SUNDEEP SINGH SONI S 37200 59.90
13/5/2010 532918 Rathi Bars SRINIVAS LAXMAIAH MACHERLA B 88694 16.00
13/5/2010 532918 Rathi Bars SAINATH HERBAL CARE MARKETING P.LTD B 100500 16.49
13/5/2010 532918 Rathi Bars SRINIVAS LAXMAIAH MACHERLA S 88694 16.49
13/5/2010 532918 Rathi Bars SHILPA MILIND DESAI S 84842 16.00
13/5/2010 512359 Rotam Comm BHARAT A PANCHAL B 7000 70.00
13/5/2010 517500 Roto Pumps ALFA FISCAL SERVICES PVT LTD B 21352 101.28
13/5/2010 517500 Roto Pumps ALFA FISCAL SERVICES PVT LTD S 21352 101.53
13/5/2010 520075 Samkrg Pistons ASHOK CHINUBHAI SHAH S 51703 75.18
13/5/2010 524540 Secunderabad Health MANISH KUMAR GILADA B 200000 18.50
13/5/2010 524540 Secunderabad Health MUNISEKHAR MEDASANI S 200000 18.50
13/5/2010 526510 Shakti Metdor SILPA SHELTERS LIMITED B 20000 180.90
13/5/2010 526510 Shakti Metdor VANITHA YERRAM B 19000 180.90
13/5/2010 531373 Suave Hotels MANISH KUMARGILADA B 60000 46.31
13/5/2010 526133 Supertex Inds SHAISHIL TUSHARKUMAR JHAVERI B 668025 4.87
13/5/2010 526133 Supertex Inds SHAISHIL TUSHARKUMAR JHAVERI S 683753 4.90
13/5/2010 533200 TALWALKAR SMART EQUITY BROKERS PRIVATE LIMITED B 185447 181.56
13/5/2010 533200 TALWALKAR CROSSEAS CAPITAL SERVICES PRIVATE LIMITED B 416157 180.49
13/5/2010 533200 TALWALKAR OPG SECURITIES P LTD B 347156 180.61
13/5/2010 533200 TALWALKAR SMART EQUITY BROKERS PRIVATE LIMITED S 185447 181.68
13/5/2010 533200 TALWALKAR CROSSEAS CAPITAL SERVICES PRIVATE LIMITED S 416057 180.38
13/5/2010 533200 TALWALKAR OPG SECURITIES P LTD S 347156 180.74
13/5/2010 530477 Vikram Thermo MAYUR DASHRATHLAL PATEL B 11712 21.64
13/5/2010 530477 Vikram Thermo MAYUR DASHRATHLAL PATEL S 11712 22.26
13/5/2010 531249 Well Pack Papers VISHAL PARE S 398000 29.21
13/5/2010 531396 Women Networks NARENDRA KUMAR SURANA S 23312 31.13
* B - Buy, S - Sell
NSE Bulk Deals to Watch - May 13 2010
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
13-MAY-2010,GLORY,Glory Polyfilms Limited,EXCEL MERCANTILE PRIVATE LIMITED,BUY,300000,21.75,-
13-MAY-2010,GLORY,Glory Polyfilms Limited,INVENTURE GROWTH & SECURITIES LIMITED,BUY,154699,21.05,-
13-MAY-2010,GLORY,Glory Polyfilms Limited,RAJ FINVEST,BUY,1348315,21.24,-
13-MAY-2010,GLORY,Glory Polyfilms Limited,SAAKSHI SHARES PVT.LTD.,BUY,521579,21.75,-
13-MAY-2010,NITESHEST,Nitesh Estates Ltd,CROSSEAS CAPITAL SERVICES PVT. LTD.,BUY,1047327,51.13,-
13-MAY-2010,NITESHEST,Nitesh Estates Ltd,GENUINE STOCK BROKERS PVT LTD,BUY,1556013,51.61,-
13-MAY-2010,TALWALKARS,Talwalkar Fitness Ltd,CROSSEAS CAPITAL SERVICES PVT. LTD.,BUY,417064,180.28,-
13-MAY-2010,TALWALKARS,Talwalkar Fitness Ltd,OM INVESTMENTS,BUY,180624,181.08,-
13-MAY-2010,TALWALKARS,Talwalkar Fitness Ltd,PANTHER FINVEST PVT. LTD.,BUY,135577,179.66,-
13-MAY-2010,ALCHEM,Alchemist Ltd,WELLINDIA SECURITIES LIMITED,SELL,72000,189.30,-
13-MAY-2010,ATNINTER,ATN International Limited,M G L HOLDINGS Pvt Ltd.,SELL,238214,2.75,-
13-MAY-2010,GLORY,Glory Polyfilms Limited,EXCEL MERCANTILE PRIVATE LIMITED,SELL,300000,21.15,-
13-MAY-2010,GLORY,Glory Polyfilms Limited,INVENTURE GROWTH & SECURITIES LIMITED,SELL,143760,21.26,-
13-MAY-2010,GLORY,Glory Polyfilms Limited,RAJ FINVEST,SELL,1256307,21.01,-
13-MAY-2010,GLORY,Glory Polyfilms Limited,SAAKSHI SHARES PVT.LTD.,SELL,534303,20.86,-
13-MAY-2010,HYDROS&S,Hydro S & S Ind. Ltd,MACHINO FINANCE PRIVATE LIMITED,SELL,80500,68.42,-
13-MAY-2010,NITESHEST,Nitesh Estates Ltd,CROSSEAS CAPITAL SERVICES PVT. LTD.,SELL,1047327,51.57,-
13-MAY-2010,NITESHEST,Nitesh Estates Ltd,GENUINE STOCK BROKERS PVT LTD,SELL,1556013,51.69,-
13-MAY-2010,TALWALKARS,Talwalkar Fitness Ltd,CROSSEAS CAPITAL SERVICES PVT. LTD.,SELL,417164,180.58,-
13-MAY-2010,TALWALKARS,Talwalkar Fitness Ltd,OM INVESTMENTS,SELL,180624,181.18,-
13-MAY-2010,TALWALKARS,Talwalkar Fitness Ltd,PANTHER FINVEST PVT. LTD.,SELL,135577,179.80,-
Aurobindo gets USFDA nod for cholesterol drug
Aurobindo Pharma today announced that it has received tentative approval for Resuvastatin Calclum tablets - 5mg, 10mg, 20mg and 40mg - from the Unites States Food and Drug Administration (USFDA).
Resuvastatin Calclum tablets are indicated for the treatment of high LDL cholesterol, total cholesterol and falls under cardio vascular (CVS) therapeutic category.
The tablets are generic equivalent of IPR Pharmaceutical Inc's Crestor tablets.
The product has a market size of nearly $2.9 billion for the twelve-month ending December 2009.
Aurobindo has a total of 116 abbreviated new drug application (ANDA) approvals from the USFDA.
In today's trade, the stock closed at Rs895.60, up by 2.38%, with a volume of 8220 shares on the BSE.
Nitesh Estates falters on debut
Shares of realty firm Nitesh Estates saw poor debut. The stock settled at Rs 50.95 on BSE, a 5.64% discount to the initial public offer price of Rs 54.
The stock debuted at Rs 50, a 7.40% discount to the initial public offer (IPO) price. The stock hit a high of Rs 55 and low of Rs 48.05. The counter clocked volume of 1.53 crore shares on BSE
Nitesh Estates' IPO ended on 27 April 2010 with 1.16 times subscription. The IPO garnered bids for 7.44 crore shares as against 6.41 crore shares on offer. The company had priced the IPO at the lower end of the Rs 54 to Rs 56 per share price band.
On 22 April 2010, Nitesh Estates raised more than Rs 58 crore through issue of 1.08 crore shares to five anchor investors including HSBC Bank (Mauritius), Nomura India Investment Fund, SBI Tax Advantage Fund, SBI Magnum Multicap Fund, and HDFC Monthly Income Plan. The shares were allotted at Rs 54 per share, at the lower end of Rs 54 to Rs 56 per share price band for the initial public offer.
Bengaluru-based Nitesh Estates is primarily engaged in development of residential projects. The company reported net profit of Rs 7.21 crore on revenue of Rs 47.84 core for nine months ended December 2009.
Nitesh Estates plans to use the proceeds from the IPO to acquire joint development rights, to finance existing and upcoming projects, repay loans and for other general corporate purposes.
Sensex off 120 points from the day's high
The key benchmark indices edged higher for the second straight day, tracking gains in Asian stocks. But, the market came off the day's high as European stocks pared initial gains and US index futures reversed gains. The BSE 30-share Sensex was provisionally up 74.85 points or 0.44%, off close to 120 points from the day's high and up close to 30 points from the day's low. Interest rate sensitive realty and auto stocks gained. Consumer durables and healthcare stocks also rose. The market breath was strong.
Index heavyweight Reliance Industries (RIL) declined. Some metal stocks reversed initial gains. Telecom stocks extended recent steep losses.
The market surged in opening trade tracking firm Asian stocks. It was range bound in early trade. The market came off higher level in morning trade. It soon regained strength. The Sensex hit a fresh intraday high in early afternoon trade. The market pared gains in afternoon trade as investors booked profit in some index stocks. The Sensex was further off the day's high in mid-afternoon trade. The market came off lower level after hitting fresh day's low in mid-afternoon trade.
European shares were off early highs as jitters about debt levels lingered. The key benchmark indices in UK, France and Germany were up by 0.02% to 0.63%.
Asian stocks edged higher on Thursday, following strong gains on Wall Street on Wednesday. Spain on Wednesday outlined measures to cut its deficit, easing fears that the Greek debt crisis could spread in Europe. The key benchmark indices in China, Hong Kong, Japan, South Korea and Taiwan rose by between 1.04% to 2.21%. But, Singapore's Straits Times fell 0.45%. Markets in Indonesia were closed for a holiday.
US index futures fell in volatile trade. Trading in US index futures indicated that the Dow could fall 14 points at the opening bell on Thursday, 13 May 2010.
US stocks surged on Wednesday boosted by technology and industrial shares, after Spain unveiled an austerity plan that reassured investors Europe was addressing its fiscal ills. The Dow Jones industrial average surged 148.65 points, or 1.38% to 10,896.91. The Standard & Poor's 500 Index rose 15.88 points, or 1.37% to 1,171.67 and the Nasdaq Composite Index added 49.71 points, or 2.09% to 2,425.02.
Spain on Wednesday said it will slash civil service pay and cut public-sector jobs, just a few days after EU finance ministers approved a 750 billion euro ($1 trillion) bailout package to stem the debt crisis. Markets have remained jittery in the past few days on worries a European debt crisis that began in Greece could spread around the world and potentially curb global growth.
Back home, the fourth quarter corporate results announced so far have been fairly encouraging. The combined net profit of a total of 1586 companies rose 35.5% to Rs 46679 crore on 29.8% rise in sales to Rs 440781 crore in the quarter ended March 2010 over the quarter ended March 2009.
On the macro front, the latest economic data showed industrial output rose lower than expected 13.5% in March 2010. The growth was also slower than February's 15.1% expansion. Manufacturing sector output rose 14.3% in March 2010. Industrial output rose 10.4% in the 2009/10 fiscal year, faster than the 2.6% growth clocked in the previous fiscal year.
The business at Indian service companies rebounded to a 21-month-high in April 2010 on new business and high input prices. The HSBC Markit Business Activity Index, based on a survey of 400 firms, rose to 62.1 in April, its highest since July 2008, and compared with 58.1 in March 2010.
The latest government data showed the food price index rose 16.44% in the year to 1 May 2010, higher than previous week's annual rise of 16.04%. The fuel price index rose 12.33%, lower than previous week's annual 12.69% rise. The primary articles index jumped 16.76%, from previous week's annual gain of 13.93%.
On Friday, 14 May 2010, the government will unveil data on inflation based on the wholesale prices for the month of April 2010. The headline inflation was 9.9% in March 2010. The RBI has forecast the headline inflation to ease to 5.5% at end-March 2011 on expectations of a normal monsoon.
The Indian Meteorological department (IMD) expects normal rainfall in the June-September monsoon season this year. Rainfall is likely to be 98% of the long-term average, the IMD said on 23 April 2010. Good monsoon rains would help raise farm output, boost rural incomes and lower food inflation. The south west monsoon 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. The quantum of rainfall in the crucial sowing month of July and distribution of rainfall during the monsoon season holds key.
The Reserve Bank of India expects India's economy to expand 8% in 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 RBI at its annual policy review on 20 April 2010 said it will continue to monitor macroeconomic conditions, particularly the price situation closely and take further action as warranted.
In its half-yearly World Economic Outlook, the International Monetary Fund (IMF) has pegged India's GDP growth at 8.75% in calendar 2010 and 8.5% in calendar 2011. According to the IMF, domestic demand in India will strengthen as the labour market improves, and investment is expected to be boosted by strong corporate profitability, rising business confidence and favourable financing conditions.
The Reserve Bank of India governor D Subbarao on Tuesday, 11 May 2010, said India prefers long-term capital inflows to short-term flows and non-debt flows to debt flows. There is no proposal to impose a Tobin type tax to rein in excessive capital inflows, the RBI governor said in a speech delivered at a conference in Zurich on Tuesday. However, it needs reiterating that no policy instrument is clearly off the table and the choice of instruments will be determined by the context, Subbarao added.
As per provisional figures, the BSE 30-share Sensex was up 74.85 points or 0.44% to 17,270.66. The index rose 193.34 points at the day's high of 17,389.15 in early afternoon trade. The Sensex rose 44.54 points at the day's low of 17,240.35 in mid-afternoon trade.
The S&P CNX Nifty was up 22.60 points or 0.44% to 5179.25 as per provisional figures.
The BSE Mid-Cap index rose 1.24% and the BSE Small-Cap index rose 0.97%. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1666 shares advanced as compared to 1201 shares that declined. A total of 104 shares remained unchanged.
Among the 30-share Sensex pack, 19 rose while the one fell.
BSE clocked turnover of Rs 3768 crore, lower than Rs 3803.33 crore on Wednesday, 12 May 2010.
Index heavyweight Reliance Industries (RIL) fell 0.89% to Rs 1072.40, off the day's high of Rs 1093.60. The stock had surged recently after a favourable ruling in the Supreme Court late last week on gas dispute with Anil Ambani controlled Reliance Natural Resources (RNRL). The Supreme Court ordered the two firms to renegotiate a deal based on government policy on gas utilization.
Earlier, the Bombay High Court, in its order dated 15 June 2009 had directed that RNRL will get assured supply of 28 mmscmd of gas from RIL's Krishna-Godavari basin for 17 years at $2.34 per million British thermal units (mBtu). The gas price was 44.28% lower than the price fixed by the government for gas sale from the RIL block in the KG basin at $4.2 mBtu.
Some metal stocks reversed early gains. India's largest steel maker by sales Tata Steel fell 1.13%. The stock was the top loser from the Sensex pack. Aluminum maker Hindalco Industries fell 0.35%.
India's largest cellular services provider by sales Bharti Airtel fell 0.7% to Rs 259.60, extending last two days' sharp fall triggered by telecom regulator Telecom Regulatory Authority of India (Trai)'s recommendation that telecom firms pay a one-time fee for holding radio-spectrum beyond 6.2 mega hertz (MHz) based on 3G prices. The stock came off the day's high of Rs 271.90.
Bharti Airtel, on Wednesday said the telecoms regulator's proposals on allocation of second-generation (2G) spectrum are shocking, arbitrary and retrograde and are against all existing global norms for spectrum allocation. The company said it was confident that the Department of Telecommunications (DoT) and that the government will take a rational approach and summarily reject these arbitrary, impractical and perverse recommendations.
India's second largest listed cellular services provider by sales Reliance Communications declined 0.58%.
Auto shares gained on strong vehicle sales in the month of April 2010. India's largest tractor maker by sales Mahindra & Mahindra rose 3.48%.
India's top truck maker by sales Tata Motors rose 3.64%, with the stock gaining for the second straight day. The company's American depository receipt, or ADR rose 3.68% to $19.42 on the New York Stock Exchange on Wednesday, 12 May 2010. The stock was the top gainer from the Sensex pack. Total sales including exports of commercial and passenger vehicles jumped 52% to 57,202 vehicles in April 2010 over April 2009. Domestic sales rose 49% to 54,065 units. Exports rose 148.8% to 3,137 units.
India's largest small car maker by sales Maruti Suzuki India rose 0.38%. Maruti's total sales rose almost 30% to 93,058 units in April 2010 over April 2009. Domestic sales rose 23.4% to 80,034 units. The data was unveiled on 1 May 2010.
Car sales in India rose an annual 39.5% to 143,976 cars in April 2010 over April 2009, data from the Society of Indian Automobile Manufacturers (SIAM) showed. Sales of trucks and buses, a barometer of economic activity, rose 64.5 % to 49,086 units in April 2010 over April 2009, SIAM said.
Bajaj Auto rose 3%, with the stock gaining for the second straight day on strong Q4 March 2010 result. The stock hit a high of Rs 2210 which is a record high for the counter. Net profit surged 306% to Rs 528.65 crore in Q4 March 2010 over Q4 March 2009.The company announced result during market hours on Wednesday.
Realty stocks rose as lower than expected growth in industrial production in March 2010 helped ease rate-hike worries. Ackruti City, Omaxe, HDIL, DLF, Indiabulls Real Estate, Phoenix Mills and Unitech rose by between 0.53% to 4.55%.
Consumer durables stocks also gained on bargain hunting. Rajesh Exports, Titan Industries and Videocon Industries rose by between 0.12% to 3.68%.
India's largest engineering and construction firm by sales Larsen & Toubro rose 0.79%, with the stock gaining for the second straight day after company's water technology business unit won an order worth Rs 850 crore in Doha, Qatar for advanced waste water treatment and urban reuse. The company announced the order win after market hours on Tuesday, 11 May 2010.
Among other capital goods stocks, Punj Lloyd, Bharat Heavy Electricals, SKF India, ABB and Praj Industries rose by between 0.59% to 2.54%.
Pharma stocks rose on bargain hunting. Biocon, Pfizer, Dr Reddy's Laboratories and Sun Pharmaceutical Industries rose by between 0.7% to 2.74%.
Ranbaxy Laboratories rose 0.28%, with the stock gaining for the third straight day on strong Q1 result. The company reported consolidated net profit of Rs 960.58 crore in Q1 March 2010 compared to a net loss of Rs 767.33 crore in Q1 March 2009. The company announced the result during market hours on 11 May 2010.
But, Cipla fell 0.35% with the stock extending recent steep slide triggered by disappointing Q4 March 2010 results. Net profit rose 8.93% to Rs 275.53 crore in Q4 March 2010 over Q4 March 2009. The result was announced after market hours on 7 May 2010.
Kotak Mahindra Bank rose 0.99% on reports the private sector bank is in talks with Citi Holdings for a possible acquisition of CitiFinancial Consumer Finance India.
Precision Wires India jumped 14.77% after net profit galloped 1850% to Rs 22.62 crore on 17.53% rise in net sales to Rs 630.19 crore in the year ended March 2010 over the year ended March 2009.
XL Telecom & Energy jumped 14.72% after the company signed a joint venture agreement with Spanish firm SDEM TEGA S.A. for bidding for and executing solar power projects.
Grey Market Premiums - May 13 2010
| Company Name | Offer Price (Rs.) | Premium (Rs.) |
| Nitesh Estate | 54 | Discount |
| Tarapur Transformers | 75 | 2 to 3 |
| Mandhana Industries Ltd. | 130 | 5 to 6 |
| Tara Health Foods | 180 to 190 | Withdraw |
| Sutlaj Jal Vidhut Nigam (SJVNL) | 26 | 3 to 3.25 |
| Jaypee Infra | 102 | Discount |
Strong start likely on Spain deficit measures
Headlines for the day:
SEBI challenges SAT order on Takeover Code
GVK Power mulls separate holding companies
R-Infra slams Tata Power for defying state govt decision
Events for the day:
Major corporate action
Weekly inflation to be announced today
Ex-date for dividend of Allahabad Bank, Bosch
Results: Educomp Solutions, MTNL, Koutons Retail India
For more events, log on to Sharekhan.com
Pre-market report
Global signals
The European shares gained on Wednesday, as encouraging results from financials, such as Allianz and ING Groep, and Spain's plan to cuts its deficit lifted investor sentiment.
The US stocks capped their best three-day run in 10 months on Wednesday boosted by technology and industrial shares, after Spain unveiled an austerity plan that reassured investors Europe was addressing its fiscal ills.
In today's trade, the Asian markets were trading on a positive note following the strong gains on Wall Street. At the time of writing this report, SGX Nifty was trading 31 points higher.
Indian markets
The fiscal problems in Europe remained unsolved, however, debt contagion fears in the country have eased a lot following the series of various measures to fight a contagion. Spain's austerity measures following the European Union's bailout fund proved that European governments have the will to fix the troubles.
These boosted the sentiments around the globe where European and US markets closed higher. The Asian markets were quoting higher in the early trade, with sentiments buoyed by the Wall Street's gains. The Indian indices are set to have a gap-up opening, with the path led by the global peers.
Going in to the session, the market is expected to remain volatile owing to weekly inflation readings, which are to be announced later today. The earnings of Educomp Solutions, MTNL, Koutons Retail India and Crompton Greaves are later to be announced today — the stocks will be closely eyed by the investors.
Commodity cues
In the commodity space, the crude oil prices slipped on Wednesday, with the Nymex light crude oil for the June series down by $0.72 per barrel, whereas in the metals space, the Comex Gold for the June series rose by $22.80 and the Comex Silver for the June series was increased by $0.37 to a troy ounce respectively.
Daily trend of FII/MF investment in equities
On May 12, 2010, the foreign institutional investors (FIIs) were the net buyers of the Indian stocks to the tune of Rs148.20 crore, whereas the domestic mutual funds, on May 11, 2010, were the net sellers of the stocks to the tune of Rs196.80 crore.
Copper drops for second straight day
Prices drop on global demand concerns
Base metal prices dropped for second straight day at Comex on Wednesday, 12 May 2010. Long-term implications of the European Union's rescue package and its impact on the currencies, specially on the euro, bothered investors and raised question about metal demand, specially from China, in coming months.
At USA, copper futures for July delivery ended lower by 2 cents (0.6%) at $3.188 a pound on Wednesday. Last week, prices lost 8%. In April, copper lost 6.1%. 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 lower by 7.6%.
On Wednesday, at LME, copper for delivery in three months ended lower by $78 (1.7%) at $6,929. Prices had crossed the $8,000 mark for first time since 2008 on 6 April. On 3 July, 2008, prices had touched an all time intra day high of $8,940.
Prices have increased by almost 51% in the past twelve months due to higher imports from China. Copper ended FY 2009 higher by 140%.
A decision by the European Union and International Monetary Fund leaders to pledge financial support to the eurozone brought about a wave of buying and short covering that caused the stock markets across globe to surge in its best single-session percentage gain in more than a year on Monday, 10 May. As per plan, countries in the eurozone that face financial uncertainty will be eligible to receive some 500 billion euros from the EU and another 250 billion euros from the IMF. In addition to those measures, the European Central Bank will buy eurozone bonds from the secondary market and the Federal Reserve has reactivated swap lines with foreign institutions. At least for the time being, those efforts have eased contagion concerns that have surrounded Greece for weeks.
But traders mulled over the fact today that in the long term how much financial aid will be pledged for euro zone countries that face tenuous fiscal conditions and also the issue of how those funds will be allocated efficiently and whether recipients can remedy their underlying problems. The long-term implication of this on the euro and worries about inflation also bothered investors.
In the currency market today, the euro dropped once again against the dollar. The euro has slipped 10.6% against the dollar this year. The dollar index, which measures the strength of the dollar against a basket of six other currencies rose by 0.4%.
The U.S. buys about 13% of the 17 million metric tons of copper sold annually and China buys about 20%.
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.
At the MCX, copper for June delivery closed lower by Rs 1.1 (0.34%) at Rs 317.35/Kg. Prices rose to a high of Rs 323.75/Kg and fell to a low of Rs 314.7/Kg during the day's trading.
Among other metals traded in the LME on Wednesday, lead ended 1.3% lower at $2,023 a ton and zinc ended 0.2% higher at $2,075 a ton. Nickel ended 0.6% lower at $22,450. Aluminum ended 1.3% lower at $2,078 a ton.
Market may extend Wednesday's gains on higher Asian stocks
The market may extend Wednesday (12 May 2010)'s gains on firm Asian stocks. Trading in S&P CNX Nifty index futures on the Singapore stock exchange indicate that the Nifty could gain 30 points at the opening bell. Asian stocks edged higher on Thursday, following strong gains on Wall Street on Wednesday. Spain on Wednesday outlined measures to cut its deficit, easing fears that the Greek debt crisis could spread in Europe. The key benchmark indices in China, Hong Kong, Japan, South Korea and Taiwan rose by between 0.07% to 1.56%. But, Singapore's Straits Times fell 0.04%.
US stocks surged on Wednesday boosted by technology and industrial shares, after Spain unveiled an austerity plan that reassured investors Europe was addressing its fiscal ills. The Dow Jones industrial average surged 148.65 points, or 1.38% to 10,896.91. The Standard & Poor's 500 Index rose 15.88 points, or 1.37% to 1,171.67 and the Nasdaq Composite Index added 49.71 points, or 2.09% to 2,425.02.
Spain said it will slash civil service pay and cut public-sector jobs, just a few days after EU finance ministers approved a 750 billion euro ($1 trillion) bailout package to stem the debt crisis, cheering investors. Markets had remained jittery in the past few days on worries a European debt crisis that began in Greece could spread around the world and potentially curb global growth.
Back home, the fourth quarter corporate results announced so far have been fairly encouraging. The combined net profit of a total of 1574 companies rose 35.6% to Rs 46652 crore on 29.7% rise in sales to Rs 439962 crore in the quarter ended March 2010 over the quarter ended March 2009.
Crompton Greaves, Educomp Solutions, Gammon India, MTNL, Morepen Lab, Koutons Retail, Kewal Kiran Clothing , Tata Coffee among others will announce their January-March 2010 quarter results today.
On the macro front, the latest economic data showed industrial output rose lower than expected 13.5% in March 2010. The growth was also slower than February's 15.1% expansion. Manufacturing sector output rose 14.3% in March 2010. Industrial output rose 10.4% in the 2009/10 fiscal year, faster than the 2.6% growth clocked in the previous fiscal year.
The yield on the benchmark 10-year bond dropped two basis points to 7.59% on Wednesday after weaker-than-expected industrial production data, indicating bond investors do not see any immediate increase in interest rates by the Reserve Bank of India. It was above 8% a few weeks ago.
The business at Indian service companies rebounded to a 21-month-high in April 2010 on new business and high input prices. The HSBC Markit Business Activity Index, based on a survey of 400 firms, rose to 62.1 in April, its highest since July 2008, and compared with 58.1 in March 2010.
The government will unveil data on some wholesale price indices for the year through 1 May 2010 viz. the food price index, the primary articles index and the fuel price index at about 12:00 IST today. Inflation based on food prices rose 16.04% in the year through 24 April 2010, slower than previous week's annual rise of 16.61%. Fuel prices inflation remained at elevated level. The fuel price index rose 12.69% in the year through 24 April 2010, same as a week ago. The primary articles index rose 13.93% in the year through 24 April 2010.
On Friday, 14 May 2010, the government will unveil data on inflation based on the wholesale prices for the month of April 2010. The headline inflation was 9.9% in March 2010. The RBI has forecast the headline inflation to ease to 5.5% at end-March 2011 on expectations of a normal monsoon.
The Indian Meteorological department (IMD) expects normal rainfall in the June-September monsoon season this year. Rainfall is likely to be 98% of the long-term average, the IMD said on 23 April 2010. Good monsoon rains would help raise farm output, boost rural incomes and lower food inflation. The south west monsoon 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. The quantum of rainfall in the crucial sowing month of July and distribution of rainfall during the monsoon season holds key.
The Reserve Bank of India expects India's economy to expand 8% in 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 RBI at its annual policy review on 20 April 2010 said it will continue to monitor macroeconomic conditions, particularly the price situation closely and take further action as warranted.
In its half-yearly World Economic Outlook, the International Monetary Fund (IMF) has pegged India's GDP growth at 8.75% in calendar 2010 and 8.5% in calendar 2011. According to the IMF, domestic demand in India will strengthen as the labour market improves, and investment is expected to be boosted by strong corporate profitability, rising business confidence and favourable financing conditions.
The key benchmarks eked out small gains in volatile trade on Wednesday, 12 May 2010 on higher European stocks and recovery in US index futures. The BSE 30-share Sensex rose 54.28 points or 0.32% to 17,195.81 on Wednesday.
As per provisional figures on NSE, foreign funds sold shares worth Rs 297.23 crore and domestic funds bought shares worth Rs 180.42 crore on Wednesday.
Daily News Roundup - May 13 2010
Ranbaxy plans to divest its investments made by the previous promoter in the group companies. (ET)
Reliance Power may build gas-fired plant in Andhra Pradesh instead of Dadri after the Supreme Court verdict. (ET)
M&M to consolidate presence in utility vehicles segment. (BL)
Tata Steel wants prices for automobiles sector to be negotiated every quarter. (BL)
Godrej Consumer to buy out Sara Lee stake in their JV for a consideration of US$234mn. (ET)
Glodyne Technoserve has acquired DecisionOne, a US based IT firm for US$104mn. (ET)
HCC spins off IT unit into a fully-owned subsidiary. (ET)
Radico Khaitan is all set to launch "After dark" a 100% grain-based whisky manufactured at its Rampur distillery. (ET)
Strides Arcolab gets US FDA approval for its anti-infective injection Bacitracin used to treat pneumonia and empyema. (BL)
GVK Power is mulling the possibility of separate holding companies for its assets in various divisions. (BS)
Reliance Infrastructure slams Tata Power for continuing to sell 100MW outside Mumbai, defying the recent Maharashtra government decision, to make a profit of Rs3bn annually. (BS)
Zydus Cadila receives an approval from the Drug Controller General of India to market H1N1 vaccines in the country. (BS)
Shriram Transport Finance plans to tap the debt market to raise up to Rs5bn through a public issue of non-convertible debentures. (BS)
MSCI has included Rural Electrification, Piramal Healthcare and Adani Enterprises in the MSCI India Index. (BS)
Elecon Engineering bags orders worth Rs2.08bn from various vendors, including GMR Infrastructure and SAIL for construction-related works. (BS)
Titan Industries plans to expand its reach by adding 300 outlets in big and small cities shortly. (BS)
The revenue from 3G spectrum sale has touched Rs584bn on the 28th day of the auction. (ET)
India's factory output grew by 13.5%, registering sixth straight month of double-digit expansion. (BS)
Put on your armor!
The best armor is to keep out of range - Italian Proverb.
Wild swings are here to stay though the outlook for the day appears slightly brighter. Risk aversion is still high with investors across the globe flocking to the safety of gold and the dollar. At the same time, stocks and commodities are showing some signs of staging a comeback. British shares rose as David Cameron took charge of the first coalition government in London since World War II. Spain’s announcement of a new austerity plan also helped boost confidence in equities.
Stocks in Europe as well as in the US posted smart gains. Asian markets are up this morning, led by Japan and South Korea though Shanghai continues to struggle amid tightening concerns. We expect a higher opening on Indian bourses. The NSE Nifty may take a shot at 5200 but will find it tough to get past 5300. Fund flows from overseas investors have tapered off lately and valuations remain quite rich. We are going through a volatile consolidation phase. It’s better to stay at a safe range and invest lesser than your means.
Results Today: Crompton Greaves, Educomp, Gammon India, Graphite India, Kewal Kiran, Koutons Retail, Lok Housing, MTNL, Plethico Pharma and Tata Coffee.
FIIs were net sellers of Rs2.97bn in the cash segment on Wednesday on a provisional basis, according to NSE web site. Local institutions were net buyers of Rs1.8bn. In the F&O segment, the foreign funds were net buyers of Rs12.89bn. FIIs were net buyers of Rs1.43bn in the cash segment on Tuesday, as per the SEBI data. Mutual Funds were net sellers of Rs1.97bn in the cash segment on the same day.
US stocks rose on Wednesday, with the Dow logging triple-digit gains, as concerns about European debt eased and investors focused on an improving domestic economy and corporate earnings. An optimistic outlook from IT major IBM too helped give a fillip to the sentiment.
After finishing nearly 37 points lower on Tuesday, the Dow Jones Industrial Average closed up 148.65 points, or 1.4%, to 10,896.91.
Of the Dow's 30 components, all but three rose, with gainers led by IBM. The IT services company's shares rallied 4.6% after the chief executive said that it would double its earnings by 2015.
Industrial conglomerate 3M Co. gained 1.7% after it declared a cash dividend late Tuesday for a 375th consecutive quarter.
The S&P 500 Index advanced 15.88 points, or 1.4%, to 1,171.67, with technology and industrial companies leading an advance that included all of the index's 10 industry groups.
Among the notable gainers, shares of Fluor Corp. rose 5.8% after the largest publicly traded US engineering firm said new business in the second quarter could top $8.8 billion.
The Nasdaq Composite Index gained 49.71 points, or 2.1%, to 2,425.02.
For every stock falling roughly six were on the rise on the New York Stock Exchange, where about 1.3 billion shares traded. Composite volume cleared 5.4 billion.
The dollar erased earlier losses and turned higher against the euro in the afternoon, rising 0.2%. The greenback also gained 0.9% against the British pound and was up 0.6% against the Japanese yen.
Gold prices continued to soar, rising $23.20 an ounce, or 1.9%, to settle at a record $1,243.50.
Uncertainty over the euro, which is used by 16 countries, is among the factors propelling gold prices to a fresh high, with investors turning to the metal as an alternative vehicle to paper currencies.
Europe's common currency traded near a 14-month low against the dollar, with the euro, slipping to $1.2617 from $1.2697 in late North American trades on Tuesday.
US light crude oil slipped 72 cents, or 1%, to settle at $75.65 a barrel after a larger-than-expected build in crude supplies.
Treasury prices extended gains, with the benchmark 10-year yield up to 3.63%, after a $24 billion auction of 10-year notes.
Cisco Systems, which reported its best quarter even after the close, finished up more than 3%.
US stocks had finished lower on Tuesday in a volatile session as investors digested a $1 trillion European aid package, but remained cautious amid lingering fears that the Greek debt crisis could spread to other nations if they don't manage to reduce large budget deficits.
Stocks rose sharply on Monday after the announcement of the massive rescue package for the debt-laden euro-zone economies.
Spain's Prime Minister Jose Luis Rodiguez Zapatero announced that civil servant salaries will be cut by 5% beginning in June in an effort to reduce costs. But fiscal problems in Europe will continue to resurface as long as deficits remain high.
The CBOE Volatility index (VIX), Wall Street's fear gauge, dipped 9%. Last week, the measure had shot up to 13-month highs as investors remained nervous about the sovereign debt crisis.
The Commerce Department said the trade deficit increased 2.5% in March, widening to $40.4 billion from a downwardly revised $39.4 billion the previous month. That was lower than the $40.5 billion that analysts.
The Treasury reported the 19th consecutive monthly deficit, with a shortfall of $82.7 billion in its April budget. That is much larger than the $52 billion gap economists were expecting during month, and it also topped March's $65.4 billion deficit. Historically, the government's budget posts a surplus during the month thanks to the April 15 tax filing deadline.
US federal prosecutors are looking into whether Morgan Stanley misled investors about complex mortgage derivatives it designed, according to the Wall Street Journal. The company, however, denies any knowledge of the investigation. Shares of the bank fell more than 2%.
After the closing bell, Cisco posted a fiscal third-quarter profit that surged 63% to $2.2 billion from a year earlier. Adjusted for one-time charges, the network equipment maker earned 42 cents per share, beating analyst estimates of 39 cents per share. Sales climbed 27% to $10.4 billion and also topped analysts' expectations. Shares of the company fell 1% in after-hours trading.
Disney reported profit and revenue that beat analysts' expectations late on Tuesday. Thanks to the success of "Alice in Wonderland," the media giant's profit surged 55% to $953 million, or 48 cents per share, and sales climbed 6% to $8.58 billion. Stock in Disney ended 1.8% lower.
Strength in the financial space lifted stocks in Europe on Wednesday, while shares in London got a boost after the formation of a coalition government by the Conservative Party and Liberal Democrats.
The Stoxx Europe 600 index gained 1.5% to 256.83. It was its second advance in three sessions since the EU-IMF approved a 750-billion euro rescue plan late on Sunday.
Government data showed first-quarter GDP growth of 0.2% in the euro-zone, but the figure beat economists' forecasts for growth of 0.1% and also covered a period of bad weather. Portugal's GDP was up 1% quarter-on-quarter. The Portuguese PSI 20 index climbed 2.9% to 7,380.66.
Spain announced budget cuts and the Spanish Ibex 35 index rose 1% to 10,107.7. The Greek ASE Composite Index rose 0.8% to 1,749.59.
The German DAX index rose 2.4% to 6,183.49, with Daimler shares up 2.9% and Infineon Technologies rising 4.6%. The French CAC-40 index advanced 1.1% to 3,733.87.
The UK FTSE 100 index rose 0.9% to 5,383.45 as a new UK government began to take shape.
The British pound declined 0.5% to $1.4855.
Crude drops again
Prices drop as crude stockpiles rise more than expected
Crude oil prices ended lower at Nymex on Wednesday, 12 May 2010. More than expected build up in crude inventories for last week as reported by the energy department affected prices today. Long-term implications of the European Union's rescue package and its impact on the currencies, specially on the euro, also bothered investors and raised question about global demand for oil in coming months.
On Wednesday, crude-oil futures for light sweet crude for June delivery closed at $75.65/barrel (lower by $0.72 or 0.9%). For the month of April, crude rose 2.8%. For the first quarter of this year, crude rose by 5.5%. Year to date, crude is higher by 0.8%.
Prices are 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 143% from a December 2008 nadir. That day prices settled at $33.87 a barrel following an intraday low of $32.40.
In the latest weekly inventory report, the EIA reported today an increase of 1.95 million barrels in the nation's oil inventories for last week, slightly above expectations. The biggest surprise was a decrease in gasoline inventories by 2.8 million barrels, whereas market was expecting a small increase. Stockpiles of distillates, which include diesel and heating oil, rose by 1.4 million barrels. The refinery utilization rate dropped more than expected to 88.4%. Meanwhile, inventories at Cushing, Okla., the delivery point for Nymex futures, rose by 784,000 barrels to a record high on 37 million barrels.
A decision by the European Union and International Monetary Fund leaders to pledge financial support to the eurozone brought about a wave of buying and short covering that caused the stock markets across globe to surge in its best single-session percentage gain in more than a year on Monday, 10 May. As per plan, countries in the eurozone that face financial uncertainty will be eligible to receive some 500 billion euros from the EU and another 250 billion euros from the IMF. In addition to those measures, the European Central Bank will buy eurozone bonds from the secondary market and the Federal Reserve has reactivated swap lines with foreign institutions. At least for the time being, those efforts have eased contagion concerns that have surrounded Greece for weeks.
But traders mulled over the fact today that in the long term how much financial aid will be pledged for euro zone countries that face tenuous fiscal conditions and also the issue of how those funds will be allocated efficiently and whether recipients can remedy their underlying problems. The long-term implication of this on the euro and worries about inflation also bothered investors.
In the currency market today, the euro dropped once again against the dollar. The euro has slipped 10.6% against the dollar this year. The dollar index, which measures the strength of the dollar against a basket of six other currencies rose by 0.4%.
The International Energy Agency today lowered by 220,000 barrels a day its forecast for global oil demand for 2010. Oil demand is estimated to grow from 2009 by 1.9%, equating to 1.6 million barrels a day, to 86.4 million barrels a day.
In contrast, yesterday, the U.S. Energy Information Agency raised its outlook for global oil demand to 1.6 million barrels per day in 2010, slightly higher than the 1.5 million barrels-a-day projection made last month. Separately, The Organization of the Petroleum Exporting Countries had also said on Tuesday it was raising its estimate for global oil demand for 2010. OPEC expects global oil demand to grow by 950,000 barrels a day to 85.38 million barrels a day. It previously expected growth of 900,000 barrels a day.
Among other energy products on Wednesday, reformulated gasoline for June delivery, the most active contract, added 2 cents, or 0.7%, to settle at $2.2104 a gallon.
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 May delivery closed lower by Rs 70 (2%) at Rs 3,390/barrel. Natural gas for May delivery closed at Rs 193, higher by Rs 5.6 (2.95%).
Precious metals shine brightly
Gold marks another all time high record closing
Precious metals ended substantially higher on Wednesday, 12 May at Comex as euro zone debt problems just failed to abate. Long-term implications of the European Union's rescue package and its impact on the currencies, specially on the euro, bothered investors and lured investors into safe-haven assets such as gold.
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 Wednesday, gold for June delivery ended at $1,243.1 an ounce, higher by $22.8 (1.9%) an ounce on the New York Mercantile Exchange. It was the highest ever closing for gold at Comex since trading commenced in 1974. It rose to a high of $1,249.3 during intra day trading. Gold for June delivery had settled above $1,200 in early December, only to pull back to $1,172 area and dip as much as the $1,050 vicinity in early February. Before today, on 3 December 2009, gold had touched an all time intra day high of $1,226.4.
Last week, gold ended higher by 2.5%. For the month of April, gold ended higher by 6%. 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 12.9%.
On Wednesday, July Comex silver futures ended higher by 37 cents (1.9%) at $19.66 an ounce. Earlier, prices reached a high of $19.365. Last week, silver ended lower by 0.9%. For the month of April, silver ended higher by 4.1%. For the first quarter of this year, silver rose by 3%. On a year to date basis, silver is higher by 11%.
A decision by the European Union and International Monetary Fund leaders to pledge financial support to the eurozone brought about a wave of buying and short covering that caused the stock markets across globe to surge in its best single-session percentage gain in more than a year on Monday, 10 May. As per plan, countries in the eurozone that face financial uncertainty will be eligible to receive some 500 billion euros from the EU and another 250 billion euros from the IMF. In addition to those measures, the European Central Bank will buy eurozone bonds from the secondary market and the Federal Reserve has reactivated swap lines with foreign institutions. At least for the time being, those efforts have eased contagion concerns that have surrounded Greece for weeks.
But traders mulled over the fact today that in the long term how much financial aid will be pledged for euro zone countries that face tenuous fiscal conditions and also the issue of how those funds will be allocated efficiently and whether recipients can remedy their underlying problems. The long-term implication of this on the euro and worries about inflation also bothered investors.
In the currency market today, the euro dropped once again against the dollar. The euro has slipped 10.6% against the dollar this year. The dollar index, which measures the strength of the dollar against a basket of six other currencies rose by 0.4%.
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 332 (1.85%) at Rs 18,229 per ten grams. Prices rose to a high of Rs 18,278 per 10 grams and fell to a low of Rs 17,920 per 10 grams during the day's trading.
At the MCX, silver prices for July delivery closed Rs 444 (1.5%) higher at Rs 29,942/Kg. Prices opened at Rs 29,460/kg and rose to a high of Rs 30,050/Kg during the day's trading.
W-shaped recovery…Nifty regains 5150
Indian markets ended with modest gains on Wednesday after a volatile day. Markets took a hit after industrial output data showed a drop in March at 13.5% from 15.1% in February. Economists had forecast a reading of ~15%. Industrial production had grown by 16.7% and 17.7% in January and December.
However, as the day progressed, "markets showed some resilience as compared to its international peers. The benchmark indices managed to stage a smart come back with the key indices managing a W-shaped recovery", says Amar Ambani, Vice President Research IIFL. Pharma, FMCG and Banking stocks were among the major gainers.
Telecom stocks were battered for a second day running after TRAI said that telecom companies will have to pay a one-time fee running into crores of rupees for holding 2G spectrum in excess of 6.2 MHz. Aggressive bids by telcos in the ongoing 3G auction has also raised concerns about the financial health of the telecom operators.
In addition, stocks like Infinite Computers shone on account of impressive earnings, while Bajaj Auto slipped despite Q4 net profit quadrupling.
The BSE Sensex advanced 54 points to end at 17,195 and NSE Nifty gained 20 points to close at 5,157. Among the 30 components of Sensex, 19 ended in the positive terrain and 11 ended in the red.
Markets in Asia ended mixed; the Nikkei in Japan was down 0.2%, Australia's S&P/ASX was up 0.5%, the Hang Seng index in Hong Kong was up 0.4% and Shanghai SE Composite was down 0.3%.
European indices were trading with mixed, the DAX in Germany was flat, the CAC 40 index in France was up 0.2% and the FTSE in the UK was down 0.4%.
Among the BSE sectoral indices, BSE Pharma index was the top gainer, the index gained 1.6% followed by BSE FMCG index up 1.5% and BSE Consumer Durables index up 1%. On the other hand, BSE Teck index was down 0.6% and BSE Power index down 0.4%. Even the Mid-Cap index ended flat and the Small-cap index fell 0.4%.
Outside the frontline indices, the big gainers in the broader market were Jubilant Org, Neyveli Lignite, Union Bank and Allahabad Bank. On the other hand, losers included Gujarat NRE, Piramal Health, Jain Irrigation and TTML.
Shares of Rural Electrification Corp. Ltd. (REC), Adani Enterprises Ltd. and Piramal Healthcare Ltd. were in demand on Wednesday after they were added to the MSCI India Index. Idea Cellular has been removed from the MSCI India index.
REC ended with smart gains, however, shares of Adani Enterprise and Piramal healthcare erased early gains and ended in the red. Idea also fell 8.2% to end at Rs54.80.
MSCI also added 51 Indian stocks in the Global Small-Cap indices while removing 12 stocks from the index.
These changes result from the May 2010 Semi-Annual Index Review and will come into effect from May 26.
Forty-two securities were added to and 45 securities were deleted from the MSCI Global Standard Indices.
Five hundred eleven securities were added to and 188 securities were deleted from the MSCI Global Small Cap Indices.
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