Market to open higher on firm Asian stocks; July inflation data eyed

The market may snap two day fall on firm Asian stocks. Trading of S&P CNX Nifty on the Singapore stock exchange indicates a gain of 24 points at the opening bell. The stock market was shut on Monday, 15 August 2011, on account of Independence Day.

Fears that higher interest rates will crimp corporate profit growth pulled the market lower for the second day in a row on Friday, 12 August 2011, with the barometer index BSE Sensex settling at 14-month closing low below the psychological 17,000 level. Foreign institutional investors (FIIs) sold shares worth a net Rs 471.09 crore on Friday, 12 August 2011, as per provisional data from the stock exchanges. Domestic institutional investors (DIIs) bought shares worth Rs 99.02 crore on that day.



According to poll carried out by Capital Market, economists expect headline inflation at 9.2% for July 2011, much above the Reserve Bank of India's perceived comfort level of 5% to 6%. The data is due today, 16 August 2011. Interest rate sensitive, realty, auto and banking stocks will be in action ahead of inflation data.

State Bank of India's consolidated net profit fell 25.34% to Rs 2512.47 crore on 19.25% rise in total income to Rs 39126.06 crore in Q1 June 2011 over Q1 June 2010. The company announced Q1 results on Saturday, 13 August 2011.

HDFC Bank reportedly on Friday raised its base rate by 50 basis points to 10% and its benchmark prime-lending rate (BPLR) to 18.5%. The bank also decided to raise fixed deposit rates by up to 75 basis points on the select maturities effective from Friday.

Coal India's consolidated net profit rose 64.05% to Rs 4143.92 crore on 28.29% rise in total income to Rs 16057.97 crore in Q1 June 2011 over Q1 June 2010. The company announced Q1 results after market hours on Friday, 12 August 2011.

National Aluminum Company's net profit rose 32.66% to Rs 376.84 crore on 35.14% rise in total income to Rs 1889.10 crore in Q1 June 2011 over Q1 June 2010. The company announced Q1 results on Saturday, 13 August 2011.

Hindalco Industries' net profit rose 20.5% to Rs 644 crore on 18.32% rise in total income to Rs 6208.78 crore in Q1 June 2011 over Q1 June 2010. The company announced Q1 results after market hours on Friday, 12 August 2011.

Reliance Communications' consolidated net profit fell 37.2% to Rs 157 crore on 3.3% fall in total income to Rs 4940 crore in Q1 June 2011 over Q1 June 2010. The company announced Q1 results on Saturday, 13 August 2011.

Sugar stocks will be in focus on reports the Centre has decided to allow export of an additional five lakh tonnes (lt) on sugar under open general license (OGL) for the current 2010-11 season (October-September). This is over and above the already permitted 10 lt, cleared through two equal instalments on April 19 and June 28. The go-ahead for export of an additional five lt quantity was given at a meeting of the Empowered Group of Ministers (EGoM) under the Finance Minister, Mr Pranab Mukherjee, here on Friday.

Industrial production grew 8.8% in June 2011 from a year earlier, helped by strong growth in manufacturing output, data released by the government on Friday, 12 August 2011, showed. The reading was sharply higher than the upwardly revised 5.95% industrial output growth in May 2011. The June reading also beat market expectations by a wide margin.

Manufacturing output, which has a 75.5% weight in the index, rose 10% on year in June, compared with a revised 6.1% rise in May. Mining output grew 0.6%, compared with a revised 1.3% rise in May. Industrial output growth data in June 2011 is encouraging, Finance Minister Pranab Mukherjee told reporters on Friday, 12 August 2011.

Meanwhile, social activist Anna Hazare vowed to fast to the death in New Delhi today to force tougher laws against corruption, defying a police ban to challenge an embattled prime minister who is grappling with scandals and a slowing economy. Tapping into a groundswell of discontent over corruption scandals in Prime Minister Manmohan Singh's government, Hazare lobbied for a parliamentary bill creating a special ombudsman to bring crooked politicians, bureaucrats and judges to book. Hazare called off his fast after the government promised to introduce the bill into parliament. The legislation was presented in early August, but activists slammed the draft version as toothless, prompting Hazare to renew his campaign.

Asian stock markets rose on Tuesday, following Wall Street shares which climbed for the third straight session on Monday, inspired by takeover news and better-than-expected Japanese data after a torrid July and August. The key benchmark indices in China, Hong Kong, Japan, Indonesia, Singapore, South Korea and Taiwan rose by between 0.12% to 3.91%.

Wall Street stocks rose for a third day on Monday on Google's offer for phone maker Motorola Mobility as investors bargain hunt the stocks after weeks of sharp selling. A meeting later in he global day by French and German political leaders was expected to result in initiatives needed to restore confidence in credit and other markets.