Taking a stand!

"The one who adapts his policy to the times prospers." -Niccolo Machiavelli.

It’s been a steady flow of news over the weekend and this week again promises to be action-packed. The opening will be slightly sluggish, as Asian markets are mostly in the red after US leaders failed to reach a deal over the weekend to avoid possible default. In the US market, the Dow fell marginally while the Nasdaq advanced amid no progress in the talks to raise the debt ceiling. The European indices managed modest gains. S&P 500 futures are down while gold futures have hit a new record. The dollar is down. Crude oil futures are hovering around $98 per barrel.

Policy initiatives seem to be on track. The Government cleared the RIL-BP deal and the Committee of Secretaries has given an in-principle nod for allowing up to 51% FDI in multi-brand retail. Some are circumspect as the Cabinet needs to accept the CoS proposal.



During the week we will have the RBI monetary policy and F&O expiry. RIL results will be closely watched today. Besides a slew of global economic statistics like US reports on housing sector, consumer confidence and GDP, investors will keenly watch the corporate results of companies like Maruti, Sterlite Industries, BHEL, Cairn India,JSW Steel, HCL Tech, HUL, ITC ONGC, Sun Pharma, PNB, Titan, ICICI Bank, Idea and PFC to mention a few.

The Nifty may face some resistance between 5700 and 5800 while short-term support is expected around 5500. The real test will be the 200-DMA levels. FII flows will be crucial as well. The monsoon session of Parliament will be another key event to keep on one’s radar.

FIIs were net buyers of Rs 4.44bn (provisional) in the cash segment on Friday, as per NSE web site. Domestic Institutional Investors (DIIs) were net buyers of Rs2.43bn (provisional). In the F&O segment, the foreign funds were net buyers of Rs 24.96bn (provisional) on the same day.

FIIs were net sellers at Rs 1.72bn in the cash segment on Thursday, as per final SEBI data. Mutual Funds were net buyers at Rs 2.06bn on the same day.

Results Today: BOI, Bank of Maharashtra, Dhanlakshmi Bank, Edelweiss Capital, Geometric,Heidelberg Cement, Mahindra Holidays, Mastek, Novartis India, NTPC, OBC, Patni Computer, Reliance Industries, Sterlite Industries and Zee News.



Asian Markets on Friday:

Asian stock indices were trading mostly higher, as investors cheered news of Greece finally getting a new official bailout, and a possible deal between President Obama and Republicans on securing a higher debt ceiling.

Global investors have been nervous over the past several days about the seemingly never-ending credit crisis in eurozone and the protracted political logjam over how to cut the swelling US budget deficit.

The MSCI Asia Pacific Index was up 0.7% at 138.20 as of 10:55 a.m. in Tokyo. It was headed for its highest close since July 8. About four stocks rose for each that declined.

The Nikkei 225 average in Japan rose by ~0.9% at 10,096 while the Topix also gained 0.7% to 865. The Shanghai Composite index in China was up 0.3% at 2,774. The Hang Seng in Hong Kong surged 1.7% at 22,370.

The Kospi in South Korea advanced ~0.75% at 2,161. The Taiex in Taiwan was up 0.8% at 8,786. The Straits Times index in Singapore climbed ~1% at 3,169. The S&P/ASX 200 index in Australia was up 1.1% at 4,607. The NZX 50 in New Zealand was up ~0.7% at 3,444.

European Union members on Thursday agreed to provide 109 billion euros ($156.7 billion) in official support and another 50 billion euros from the
private sector, the European Council said in a statement.

The heads of state, including France's Nicolas Sarkozy and Germany's Angela Merkel, also agreed to extend the maturity of future loans for Greece to a maximum 30 years from the current 7.5 years. The new funds will be provided to Greece at about 3.5%.

EU member nations will also work closely to come up with concrete proposals by October to improve working methods and enhance crisis
management in the euro area, the statement said.

As many as 30 non-US firms, including HSBC, Deutsche Bank, Allianz, BNP Paribas and Munich Re agreed to accept a debt exchange of Greek bonds as well as a still-undetermined-sized buyback, according to the Institute of International Finance.

The euro rallied after EU leaders agreed to a new bailout plan for Greece.

Meanwhile, media reports indicate the US President Barack Obama and House Speaker John Boehner are close to reaching a deal on raising the debt ceiling, but both sides refuted reports and said there was no agreement yet.

The dollar rose against most counterparts on speculation that President Obama and Republicans are getting closer on an agreement to cut the US budget deficit.

The yen fell against all of its 16 major counterparts and slid from a four-month high versus the dollar after Japanese Finance Minister Yoshihiko Noda reiterated that he was watching markets closely.

US Markets on Thursday:

US stocks rallied on Friday, extending a weekly gain for the Standard & Poor’s 500 Index, as European officials announced a new financial package for debt-plagued Greece in a bid to prevent the region’s debt crisis from spreading.

Better-than-expected reports from companies like AT&T and Morgan Stanley also increased investors' confidence in the prospects for corporate earnings.

The Dow Jones Industrial Average advanced 152.50 points higher, or 1.2%, to end at 12,724.41. All but one of its 30 components gained.

The S&P 500 closed at 1,343.80, up 17.96 points, or 1.4%. Financials fared the best while technology and telecom rose the least.

The Nasdaq Composite Index added 20.20 points, or 0.7%, to 2,834.43.

The dollar weakened against the euro, the Japanese yen, and British pound.

Oil for September delivery rose 73 cents to $99.13 a barrel.

Gold futures for August delivery fell $9.90 to $1,587 an ounce.

The price on the benchmark 10-year US Treasury dropped, pushing the yield up to 3.02% from 2.93% late on Wednesday.

US stocks touched intraday highs as European Union leaders reiterated their support for Greece following a summit in Brussels. Just ahead of the closing bell, the European Council said that EU member states had agreed to provide 109 billion euros ($156.7 billion) in official support to Greece.

Another 50 billion euros will come from the private sector in a voluntary Greek bond exchange and debt buyback program. As many as 30 international financial institutions, including Deutsche Bank, HSBC, BNP Paribas, have agreed to take part.

In addition, the maturity of future loans for Greece from the EU’s bailout fund was extended to a maximum of 30 years from the current 7.5 years. The new funds to Greece will be provided at about 3.5%.

The US government said that new claims for unemployment benefits climbed a bit more than expected last week. The Labor Department reported that weekly initial unemployment claims climbed by 10,000 to 418,000 in the latest week. Economists expected claims to rise to 411,000.

An index of manufacturing activity in the Philadelphia region rebounded in July.

The Philadelphia Federal Reserve's manufacturing index rose to 3.2 in July, from a -7.7 the previous month. Economists were expecting manufacturing activity to stay flat.

The Federal Housing Finance Agency reported that home prices rose 0.4% in May.

The Conference Board’s index of leading economic indicators climbed 0.3% in June, matching estimates of analysts.

Intel shares closed down 0.8% after the chip titan cut its outlook for 2011 personal-computer sales.

American Express Co. rose after reporting earnings late on Wednesday that beat expectations.

AT&T shares rose after the telecom provider posted second-quarter results that managed to beat Wall Street estimates even as subscriptions slowed.

Shares of eBay rose and Qualcomm fell a day after both companies reported better-than-expected earnings.

Express Scripts announced that it will buy Medco Health Solutions in a deal worth $29.1 billion, combining two of the country's largest pharmacy benefit managers. Shares of Medco spiked 14%.

Morgan Stanley jumped after the bank reported a net loss of 38 cents per share, on revenues of $9.3 billion for the second quarter. Analysts had expected the Morgan Stanley to post a loss of 64 cents a share.

Shares of Motorola Mobility jumped after activist investor Carl Icahn said the company should explore auctioning off some of its key patents.

Shares of Microsoft were up in the post-market session after the software company's earnings of 69 cents a share, beating the 58 cents that analysts had expected.

European Markets on Thursday:

European equity indices closed higher, with banks yet again leading from the front, amid reports that regional leaders were inching ever so close to a new bailout deal for Greece.

The Stoxx Europe 600 index rose 1% to close at 270.48. It had earlier fallen as much as 0.9% following disappointing preliminary manufacturing PMI data from Europe and China.

A preliminary reading of China’s manufacturing- purchasing-managers index (PMI) fell to a 28-month low in July. The euro zone‘s own composite PMI was also weak, hitting a 23-month low.

The UK FTSE 100 index gained 0.8% at 5,899.89. The French CAC 40 index rose 1.7% to close at 3,816.75, with bank stocks in the lead. The German DAX 30 index climbed 1% to finish at 7,290.14.

The Greek ASE Composite index rose 2.5% to 1,214.42 and Italy’s FTSE MIB index climbed 3.8% to 19,490.7.

Shares of telecom-equipment group Ericsson dropped almost 10%. The group reported a lower-than-expected profit as restructuring charges and the strong krona hurt the bottom line.

Nokia shares rose after the Finnish company swung to an operating loss of 487 million euros but said it was making better-than-expected progress in a major restructuring plan.

AstraZeneca gained after the US Food and Drug Administration approved its Brilinta anti-clotting drug.