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Sunday, August 07, 2011
US at risk of recession - Goldman Sachs
Goldman Sachs, in a bearish forecast, expects 2 percent growth in the U.S. for the next few quarters and a "significant risk, one in three, that we will go back into recession," senior economist Jan Hatzius told CNBC Friday.
"We have seen enough over the last two months to come to the conclusion that in the first half the underlying pace of growth was pretty disappointing, even if you adjust for [the disruptions in] Japan and adjust for fiscal policy," he said.
Read more
US Crisis - all that you need to know
Rumors were swirling all day, and then it finally hit: Standard & Poor's downgraded the nation's credit rating Friday evening, the first time the U.S. Treasury has lost its pristine AAA rating since ratings began nearly a century ago.
S&P now rates the United States at AA+. The rating agency didn't beat around the bush when describing why it made the cuts:
Read more
World might dump dollar - China's top rating agency
The man who leads one of China’s top rating agencies says the greenback’s status as the world’s reserve currency is set to wane as the world’s most powerful policy makers convene to examine the implication of S&P’s decision to strip the United States of its triple “A” rating.
In comments emailed to CNBC, Guan Jianzhong, chairman of Dagong Global Credit Rating, said the currency is “gradually discarded by the world,” and the “process will be irreversible.”
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The amazing story of US Downgrade
On Friday night, when news broke that S&P had made a $2 trillion error in its analysis of the US debt situation, we kind of didn't believe it.
Basically we figured there might have been some issue, but that mostly the Treasury was trying to throw up a smokescreen to distract from the bad news.
But this WSJ tick-tock on the interactions between the ratings agency and Treasury over the last week really is kind of unbelievable.
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Investors could diversify out of US bonds
Foreign exchange markets are bracing for heightened volatility on Monday morning as the reaction to Standard and Poor's lowering of US long-term sovereign credit rating to AA+ from AAA sets in.
It is obvious that global investors would consider diversifying their assets out of US treasuries. This move can apply pressure on the dollar. There is also fear that some funds which are not allowed to hold any asset without AAA rating might be forced to sell treasuries in the near term.
However, it is hard to envisage a total collapse of the greenback as no investor can claim that he was unaware of the state of the US economy or the risks associated with investing in dollar-denominated assets.
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Reason why US rating was downgraded
What is a downgrade?
Standard & Poor's, one of the three major credit rating agencies that assign scores to debt issued by institutions, municipalities, and governments, said there is a heightened degree of risk in holding debt issued by the United States. So it lowered its rating from the AAA, the highest possible level, by one notch to AA+. It also said the outlook is negative.
Why did it lower the rating?
The credit rating agency believes the outstanding debt of $14.3 trillion and projected deficits for coming years in the United States no longer warrant the top-tier rating that it had assigned to the United States since 1941. It also said that the political environment does not build confidence that the United States can agree on how to lower the deficit in a meaningful way any time soon.
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US Crisis to hamper growth
The downgrading of US sovereign rating will negatively impact exports and moderate capital flows into the country but overall economic growth will remain robust at 8.2%, said Prime Minister’s economic advisory council chairman (PMEAC) C. Rangarajan.
“More than the downgrade what will be the impact for India and the rest of the world will be the slow pace of recovery of the US. It will have implication for trade flow and capital flow,” Rangarajan told PTI.
Read more
Middle East markets crash
Stocks tumbled across the Middle East on Sunday as most regional markets opened for their first day of business following a historic downgrade of the United States' credit rating.
Mideast markets mostly operate Sunday to Thursday. That makes them the first to react to credit rating agency Standard & Poor's decision late Friday to cut the U.S. level one notch to AA+ from its top AAA rating. The only exception is OPEC powerhouse Saudi Arabia, which plunged 5.5 percent when it opened Saturday.
The Dubai Financial Market's benchmark index suffered some of the steepest declines, plunging more than 5 percent in early trading before trimming its losses. The index was down 3.8 percent to 1,482 points by early afternoon.
While the S&P downgrade weighed on the market, it was also dragged lower by a lower than expected quarterly profit from Arabtec Holding, the Emirati construction giant that helped build the world's tallest tower in Dubai. Arabtec shares fell 4.9 percent to trade at 1.4 dirhams (38 cents).
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Weekly: Markets in bear grip, fall 5% on global meltdown
Investors remained jittery on fears of global economic recession alongwith high inflation and rising interest rates, with markets posting 5% weekly decline
Major news for the week
Food inflation at 8.04% versus 7.33%
India’s GDP to grow by 8.2% in FY12: PMEAC
India’s factory output falls to a 20-month low in July
Exports rise 46.45% to $29.21 billion in June
Bharti Airtel Q1 consolidated net profit down nearly 28%
Gold gains on safe haven buying
Gold prices advanced on Friday, recovering from the previous session's drop, as global investors continued to put their faith in the yellow metal amid fears of deteriorating economic conditions in the US and eurozone. Investors also bought gold as an alternative investment as risky assets like equities and commodities seem to have gone out of favour for the time being on concern about faltering global economic growth.
Weekly Stock Picks - Aug 7 2011
Buy Satyam Computer
Buy Jain Irrigation
Buy GAIL
Buy Indian Hotels
Buy Aurobindo Pharma
Weekly Newsletter - Aug 7 2011
Global events clearly overwhelmed the Indian markets. We didn’t fall as much as US and European markets did but still the fall was quite steep. The carnage was sparked by disappointing economic reports from various parts of the world. But, markets were particularly concerned about the signals coming out of the US. Even the clinching of the crucial US debt ceiling deal failed to lift the gloom.
World markets in turmoil on growth jitters
Equity markets across the globe went into a tailspin, as panicky investors scurried for cover amid fears that the US economy was slowing down and the eurozone credit crisis will deteriorate. The selloff across world markets came despite the US Congress clearing a crucial legislation to lift the debt ceiling before the Aug. 2 deadline. The undertone was hit by a series of downbeat economic reports pointing to a deceleration in the US economy. Also, Moody's and Fitch warned that US' coveted "AAA" rating was still in danger of being downgraded. Economic data from other pockets of the world too showed moderation in economic activity, especially in the manufacturing space.
Saturday, August 06, 2011
S&P downgrades US ratings from AAA
Credit rating agency Standard & Poor's has downgraded the United States' credit rating from AAA for the first time since the ratings were initiated.
Friday, August 05, 2011
BSE Bulk Deals to Watch - Aug 5 2011
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
5/8/2011 532397 Arms Paper SANGEETA AJAY GOENKA B 480432 10.00
5/8/2011 532397 Arms Paper MONICA TIBREWAL S 94000 10.00
5/8/2011 532397 Arms Paper LAXMIDEVI TIBREWAL S 386432 10.00
5/8/2011 523850 Axtel Inds DEEPINDER SINGH POONIAN B 42495 12.73
5/8/2011 530095 Bhagwandas Met GITA AGARWAL X B 40200 5.30
NSE Bulk Deals to Watch - Aug 5 2011
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
05-AUG-2011,ACROPETAL,Acropetal Tech Ltd,RAVI KUMAR D,BUY,606000,16.50,-
05-AUG-2011,ARSSINFRA,ARSS Infra Proj. Ltd,BNK SECURITIES PVT.LTD.,BUY,100000,382.55,-
05-AUG-2011,BAJAJHLDNG,Bajaj Holdings & Invs Ltd,JAMNALAL SONS PRIVATE LIMITED,BUY,900000,750.00,-
05-AUG-2011,CREWBOS,Crew B.O.S. Products Limi,MEHROTRA VIVEK LAKSHMINATH,BUY,85917,48.74,-
05-AUG-2011,DCHL,Deccan Chronicle Hold Ltd,DECCAN CHRONICLE HOLDINGS LTD - BUY BACK ORD-WRONG CODE,BUY,1257500,65.98,-
Panic Friday: Recession fears pull Sensex 387 points lower
Investors ran for exits after the worsening financial crisis in Europe compounded anxiety over a weak US economy that has come close to stalling. The Sensex fell 387 points and the Nifty down 121 points
Major headlines
Ranbaxy Lab Q2 consolidated PAT down 25%
Bosch Q2 net profit soars 33%
GE Shipping Q1 consolidated net profit slips 5%
Market may slide further
The market may witness further selling pressure hit by the Reserve Bank of India's (RBI) aggressive rate hike at a policy review on 26 July 2011. The market saw a steep slide recently on concerns that higher interest rates will crimp corporate profit growth. Fears of global economic recession added to the decline on the domestic bourses recently.
Sensex, Nifty at 13-1/2-month closing lows on US recession fears
Fears of a possible US double-dip recession and worsening European sovereign-debt woes pushed Indian shares further lower today, 5 August 2011. Global worries spooked the market at a time when investors investing in India are already worried about corporate earnings growth, with interest rates rising. Nevertheless, the market today, 5 August 2011, staged a strong intraday rebound after tumbling to 13-1/2-month low. The barometer index BSE Sensex regained the psychological 17,000 mark after falling below that mark for a brief period in early afternoon trade. The Sensex tumbled 387.31 points or 2.19%, up 314.96 points from the day's low and off 52.31 points from the day's high.
Sensex slumps almost 5% on local, global growth worries
Worries about a likely slowdown in corporate earnings growth due to higher interest rates, fears of a possible US double-dip recession and worsening European sovereign-debt woes spooked the market with the barometer index BSE Sensex and the 50-unit S&P CNX Nifty hitting 13-1/2-month lows. A number of commercial banks have raised lending rates recently after the central bank raised its key lending rate by a steeper-than-expected 50 basis points at a policy review on 26 July 2011. The market fell in four out of the five trading sessions during the week ended Friday, 5 August 2011.
Grey Market Premiums - IIFL NCD Bond, L&T Finance
| Company Name | Offer Price (Rs.) | Premium (Rs.) |
| Vaswani Ind. | 49 | 1.50 to 2 |
| Inventure Growth | 117 | + / - 3 to 5 |
| L & T Finance | 52 | 2 to 2.50 |
| IIFL Bond | 1000 | 3 to 3.25 |
Worst sell off since 2008
The two-week plunge in stock prices is signaling economic anxiety, but it's also compounding the problem: Lower stock prices are shrinking Americans' wealth, rattling their confidence and making them less inclined to spend.
And employers may become even slower to hire.
The Dow Jones industrial average plummeted 513 points, or 4 percent, on Thursday on fears about the US economy and the debt crisis in Europe. The major stock indexes have sunk more than 10 percent from their previous highs.
Crude drops for fourth straight day
Weak economic data and rise in crude inventories push prices lower
Crude prices registered a big drop on Wednesday, 03 August 2011 at Nymex. Prices dropped the most in five weeks as investors became nervous regarding current pace of economic growth as reports following the set of economic reports that hit the wires today. Weekly inventory report showing rise in crude supplies for last week also pushed crude prices lower.
A sell-off on cards on dismal global cues
The market is likely to see a steep sell-off on extremely weak global cues arising out of fears of a double-dip recession following weak economic data. Trading of S&P CNX Nifty on the Singapore stock exchange indicates a slump of 139 points at the opening bell.
FIIs sold shares worth a net Rs 254.55 crore on Thursday, 4 August 2011, as per provisional data from the stock exchanges. Domestic institutional investors (DIIs) bought shares worth Rs 316.5 crore on that day.
Concerns about corporate earnings growth, high food inflation and data showing aggressive selling by foreign institutional investors continued to rattle the bourses for the third straight session of trade on Thursday, 4 August 2011 with the barometer index BSE Sensex and the 50-unit S&P CNX Nifty hitting 6-week lows. The BSE Sensex lost 247.37 points or 1.38% to 17,693.18, its lowest closing level since 22 June 2011 and the S&P CNX Nifty declined 73 points or 1.35% to 5,331.80, its lowest closing level since 23 June 2011.
Markets set to crash on global recession fears
Negative factors coming from the overseas markets may pull the Indian stock markets down drastically in the opening trade. A heavy sell-off is expected today.
Headlines for the day:
Bankers to strike today
Cabinet Committee on Economic Affairs okays Rs1200 cr for AI
IDFC to invest 80 crore in Green Infra
Daily News Roundup - Aug 5 2011
Havells India announced its entry into the domestic appliances market with an aim to garner sales of Rs5bn from the segment in the next four years. (ET)
ONGC plans to commence oil and gas production from the Krishna Godavri basin in a month and start pumping hydrocarbons from another block in the offshore region next May. (ET)
Tata Steel said it will invest £7mn at its Hartlepool mill in the United Kingdom to enhance the welding and material handling capability. (ET)
Sensex stumbles for 3rd straight day...Nifty below 5350
The Indian markets ended near day's low on Thursday, extending their losing streak into the third straight trading session. The NSE Nifty has slipped over 160 points in the last three days with the index closing below the 5350 levels for the first time since June 26.
Markets opened with a positive bias, tracking overnight gains in the US markets and positive trend in a few Asian markets. However, the upswing was very short-lived, as the index slumped in late afternoon trade and ended near day's low.
TANK…God it’s Friday!
There is no greater importance in all the world like knowing you are right and that the wave of the world is wrong, yet the wave crashes upon you. - Norman Mailer.
It’s not the end of the world. A global carnage in the financial markets was perhaps long overdue. The initial jubilation over the passing of the US debt deal has swiftly given way to considerable pain. It’s a sea of red across world markets. Relatively safer havens like gold, bonds, yen and Swiss francs may temporarily attract interest.
Thursday, August 04, 2011
Gold continues to make more headway
Gold prices continued its surge to reach another milestone of Rs 24,000 per 10 grams at the domestic bullion market on Thursday on strong stockists and investment buying triggered by climbing international prices.
Silver also galloped on heavy speculative offtake on the back of rising industrial demand.
"The yellow metal is witnessing a runaway rally for the past three days here, due to overseas bullishness for the metal as a risk aversion asset, impacted by worsening global economic situations," traders said.
BSE Bulk Deals to Watch - Aug 4 2011
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
4/8/2011 532682 ABG Shipyard Aadi Financial Advisors LLP B 400000 388.00
4/8/2011 590006 Amrutanjan Health-$ CROSSEAS CAPITAL SERVICES PRIVATE LIMITED B 17491 919.45
4/8/2011 590006 Amrutanjan Health-$ CROSSEAS CAPITAL SERVICES PRIVATE LIMITED S 17491 919.75
NSE Bulk Deals to Watch - Aug 4 2011
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
04-AUG-2011,AMRUTANJAN,Amrutajan Health Ltd,CROSSEAS CAPITAL SERVICES PVT. LTD.,BUY,17491,919.80,-
04-AUG-2011,ATLASCYCLE,Atlas Cycles (Haryana) Lt,CROSSEAS CAPITAL SERVICES PVT. LTD.,BUY,17381,418.09,-
04-AUG-2011,BGLOBAL,Bharatiya Global Info Ltd,GKN SECURITIES,BUY,119699,21.99,-
04-AUG-2011,CREWBOS,Crew B.O.S. Products Limi,KARVY FINANCIAL SERVICES LIMITED,BUY,500,52.45,-
04-AUG-2011,CREWBOS,Crew B.O.S. Products Limi,VIVEK LAKSHMINATH MEHROTRA,BUY,70997,53.35,-
04-AUG-2011,ECEIND,ECE Industries Limited,BHUWANIA GOODS PRIVATE LIMITED,BUY,170370,105.24,-
04-AUG-2011,GPPL,Gujarat Pipavav Port Ltd,MERRILL LYNCH INDIA EQUITIES FUND MAURITIUS LIMITED,BUY,3864000,73.50,-
Now, pay more for Diesel soon
With passenger cars consuming about 15 per cent of the diesel, the government on Thursday indicated that it might do away with the subsidy enjoyed by such vehicle owners.
"...we can accept your (Opposition) suggestion and try to work out what mechanism could be found out so that this section (diesel car owners) are not subsidised," finance minister Pranab Mukherjee said replying to a debate on price rise in the Lok Sabha.
Read more
Sensex falls over 3% in July, biggest monthly fall since Jan
A slew of negatives weighed on markets in July, which include US & Europe debt crisis, poor results, weak IIP data, high inflation numbers and RBI’s hawkish stance.
Major news for the month
Infosys Q1 consolidated net profit up 16% to Rs1,722 crore
May IIP at 5.6%
Inflation in June at 9.44% versus 9.06%
HDFC Bank Q1 net profit up 34% to Rs1,085 crore
TCS Q1 net profit at Rs2,380 crore
RBI hikes repo, repo");'> reverse repo by 50 bps
Wipro Q1 consolidated net profit up 1% to Rs1,335 crore
RIL Q1 net profit up 17% to Rs5,661 crore
ICICI Bank Q1 consolidated net profit soars 53% to Rs1,667 crore
Nifty August 2011 futures below 5350
Turnover surges
Nifty August 2011 futures were at 5,339.80, at a premium of 8 points over spot closing of 5,331.80. Turnover in NSE's futures & options segment surged to Rs 123167.69 crore from Rs 104008.08 crore on Wednesday, 3 August 2011.
Reliance Industries August 2011 futures were at 813.20, at a premium spot closing of 811.
Tata Steel August 2011 futures were at 558.10, near spot closing of 558.50.
Inventure Growth & Securities surges on debut
Settles at Rs 207.95 on BSE
Shares of Inventure Growth & Securities settled at Rs 207.95 on BSE, a premium of 77.73% over the initial public offer price of Rs 117.
The stock debuted at Rs 119, a premium of 1.71% over the initial public offer (IPO) price. The stock hit a high of Rs 225 and low of Rs 91.55. On BSE, 4.70 crore shares were traded on the counter.
Sensex tumbles 6.24% in eight days; FIIs step up selling
Concerns about corporate earnings growth, high food inflation and data showing stepping up selling by foreign institutional investors spooked the market with the barometer index BSE Sensex and the 50-unit S&P CNX Nifty hitting 6-week lows. Reports of weak monsoon rains recently also weighed on the sentiment as Indian shares extended losses for the third straight day. The Sensex fell below the psychological 18,000 mark, after regaining that level earlier in the day. The BSE Sensex plunged 247.37 points or 1.38%, off close to 350 points from the day's high and up close to 30 points from the day's low. The market breadth turned negative from positive breadth earlier in the day.
The market has witnessed a steep slide recently on concerns that higher interest rates will crimp corporate profit growth. The Sensex has tumbled 1,178.11 points or 6.24% in eight trading sessions from a recent high of 18,871.29 on 25 July 2011, hit by the Reserve Bank of India's (RBI) aggressive rate hike at a policy review on 26 July 2011. A number of commercial banks have raised lending rates recently after the central bank raised its key lending rate by a steeper-than-expected 50 basis points on 26 July 2011.
Foreign institutional investors (FIIs) sold shares worth net Rs 801.10 crore on Wednesday, 3 August 2011, compared with an outflow of Rs 82.70 crore on Tuesday, 2 August 2011, latest data released by the Securities & Exchange Board of India (Sebi) showed.
Auto shares dropped after the finance minister said the government may look at charging higher diesel prices for luxury cars. Shares of state-run oil marketing companies (PSU OMCs) surged on expectations that their losses on diesel sales could fall if the fuel is sold at a higher price to car users. Index heavyweight Reliance Industries (RIL) dropped to a 52-week low. Three other index heavyweights, ICICI Bank, Infosys and Larsen & Tourbo, also slipped.
Reliance Infrastructure bucked weak market trend after the company on Wednesday, 3 August 2011, said a state-level electricity regulator has allowed it to recover accumulated costs from customers. Bank stocks reversed initial gains on worries that higher lending rates will crimp loan growth. Telecom pivotals saw divergent trend after sector bellwether Bharti Airtel reported a surprise fall in first quarter net profit on Wednesday, 3 August 2011.
The market nudged higher in early trade as bargain hunting emerged after a recent steep slide. Volatility ruled the roost as the key benchmark indices retreated from intraday highs in morning trade. Intraday volatility continued as the key benchmark indices hit fresh intraday lows in mid-morning trade as weak Asian shares weighed on the sentiment.
Intraday volatility continued with the Sensex alternatively swinging between gains and losses in early afternoon trade. The market held positive zone in afternoon trade as European shares edged higher in early trade. Fresh wave of selling jolted markets in mid-afternoon trade, with the Sensex hitting 6-week low. The market extended losses in late trade.
The BSE Sensex was down 247.37 points or 1.38% to 17,693.18, its lowest closing level since 22 June 2011. The Sensex lost 275.82 points at the day's low of 17,664.73 in late trade. The index rose 92 points at the day's high of 18,032.55 in morning trade, its highest level since Tuesday, 2 August 2011.
The S&P CNX Nifty was down 73 points or 1.35% to 5,331.80, its lowest closing level since 23 June 2011. The Nifty hit a high of 5,434.50 in intraday trade, its highest level since Tuesday, 2 August 2011. The Nifty hit a low of 5,323.15 in intraday trade.
The BSE Mid-Cap index fell 0.76% and the BSE Small-Cap index declined 0.57%. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was negative. On BSE, 1,708 shares declined and 1,136 shares rose. A total of 131 shares remained unchanged. The breadth was positive earlier in the day.
Among the 30-share Sensex pack, 28 declined while only two of them managed gains.
Index heavyweight Reliance Industries (RIL) lost 1.53% to Rs 812.50, off day's high of Rs 831.65. The stock slipped to a 52-week low of Rs 810.25 in intraday trade today, 4 August 2011. The prized KG-D6 fields of RIL produced 31% less than previously projected natural gas output in the April-June 2011 quarter, the Oil Ministry said recently. The average gas production during April-June 2011 from KG-DWN-98/3 (KG-D6) block was 48.60 million metric standard cubic meters per day (mmscmd), less than the approved Field Development Plan (FDP) rate of 70.39 mmscmd, the ministry said.
RIL's operating profit margin (OPM) declined sharply to 12.25% in Q1 June 2011 from 16.04% in Q1 June 2010 as weak performance from the oil & gas and petrochemicals businesses offset strong performance from the refining segment. RIL's net profit rose 16.69% to Rs 5661 crore on 39.1% increase in net sales to Rs 81018 crore in Q1 June 2011 over Q1 June 2010. The result was announced on 25 July 2011.
RIL's gross refining margin (GRM) surged to $10.3 a barrel from $7.3 a barrel in Q1 June 2010. Gas production from RIL's KG-D6 field off the east coast declined 18% to 156.2 BCF in Q1 June 2011 over Q1 June 2010. Production of gas condensate from the filed jumped 81.6% to 0.21 million barrels in Q1 June 2011 over Q1 June 2010. The company said gas sales have been prioritized as per government's directive with effect from 9 May 2011.
Capital goods stocks extended recent losses. Bhel, Larsen & Toubro, Praj Industries and ABB fell by between 0.59% to 3.64%.
Coal India rose 0.45% ahead of its entry into the NSE's futures & options segment from tomorrow, 5 August 2011. The National Stock Exchange has decided to add Coal India, Delta Corp, Dhanlaxmi Bank and Gujarat Flurochemicals for trading the futures & options (F&O) segment. Trading in these four additional stocks in the F&O segment will start from 5 August 2011.
Coal India replaces Reliance Infrastructure in the 30-share BSE Sensex with effect from Monday, 8 August 2011. In another change in the constituents of the barometer index, Sun Pharmaceutical replaces Reliance Communications in Sensex from that day.
Auto shares dropped after Finance Minister Pranab Mukherjee said the government may look at charging higher diesel prices for luxury cars and commercial users to ensure they don't benefit from a policy designed to help the needy. Automakers are investing heavily in rolling out diesel-run vehicles to meet growing demand from consumers, who are increasingly shifting to such vehicles as diesel price is kept sharply lower than that of petrol.
Mukherjee said 15% of the total diesel consumption in the country is by passenger cars. Oil Minister Jaipal Reddy said such a proposal is at an early stage and needs considerable discussion.
The BSE Auto index fell 2.06% and underperformed the Sensex. India's largest utility vehicles and tractors maker by sales Mahindra & Mahindra slumped 4.45% to Rs 679.25 and was the top loser from the Sensex pack. Tata Motors (down 1.55%) and Maruti Suzuki India (down 1.19%), were the other losers from the auto pack.
Bike makers, too, declined. India's largest bike maker by sales Hero MotoCorp shed 0.41% and India's second largest bike maker by sales Bajaj Auto fell 2.46%.
BSE FMCG index fell 1.82% and underperformed the Sensex. India's largest cigarette maker by sales ITC dropped 3.17% on reports the government is considering a hike in excise duty on tobacco products. The excise duty rates on cigarettes currently vary depending on the length of the cigarette.
Among other FMCG stocks, Hindustan Unilever, Dabur India and Marico shed by between 0.25% to 1.66%.
Banking stocks declined, reversing intraday gains, on worries that higher lending rates will crimp loan growth. A number of commercial banks have raised lending rates recently after the central bank raised its key lending rate by a steeper-than-expected 50 basis points at a policy review on 26 July 2011. BSE Banking index, Bankex fell 1.05% and outperformed the Sensex.
India's second largest private sector bank by net profit HDFC Bank slipped 1.14% and India's largest private sector bank by market capitalisation ICICI Bank fell 0.87%. India's largest commercial bank by branch network State Bank of India (SBI) declined 0.95%.
India's largest mortgage finance lender by total income Housing Development Finance Company (HDFC) fell 0.51% in volatile trade. HDFC has revised its retail prime lending rate (RPLR) by 50 basis points (bps) on its loans with effect from 1 August 2011. HDFC said the hike in lending rates is in line with interest rates in the economy, which have hardened due to increase in the policy rates by 75 bps since June 2011.
India's largest listed cellular services provider by sales Bharti Airtel shed 0.79%, extending Wednesday's over 1% decline triggered by a surprise fall in first quarter net profit on sequential basis reported by the firm during market hours on that day. Bharti's consolidated net profit as per International Financial Reporting Standards (IFRS) fell 13.2% to Rs 1215.20 crore on 4.18% growth in total revenue to Rs 16974.90 crore in Q1 June 2011 over Q4 March 2011.
Bharti Airtel said income before taxes fell 17.03% to Rs 1719 crore in Q1 June 2011 over Q1 June 2010, mainly on account of higher interest outgo of Rs 344 crore (due to the Africa acquisition and 3G investments in India), and 3G license fee amortization of Rs 159 crore. The effective tax rate for Q1 increased to 29.9%, mainly due to reduction in tax holiday benefits in India, Bharti said in a statement.
The consolidated operating free cash flow was at Rs 1357 crore in Q1 June 2011. Continued robust cash generation has resulted in improvement of the Net Debt Equity ratio to 1.20 in Q1 June 2011 compared with 1.38 on 30 June 2010.
In a post result statement Sunil Bharti Mittal, Chairman & Managing Director, Bharti Airtel said, "Bharti Airtel has started this fiscal year on a stable note. Revenue growth has been steady across all geographies, with Africa recording a healthy sequential growth of approximately 6%, and annual growth of 21%. In India, the company's efforts in the area of cost efficiencies have helped arrest the margin decline. The new customer facing organization in India will see more agile and responsive teams in action. This will also give a fillip to growth in value added services, broadband, digital TV and airtel money. Overall, 2011-12 promises to be an exciting year of transformation".
India's second largest listed cellular services provider by sales Reliance Communications rose 0.66%, halting three-day fall, on bargain hunting. Idea Cellular rose 2%.
Reliance Infrastructure gained 0.95% after the company on Wednesday, 3 August 2011, said a state-level electricity regulator has allowed it to recover accumulated costs from customers.
Indian Hotels slipped 0.84% ahead of its Q1 results today, 4 August 2011. The owner of the Taj group of hotels, Indian Hotels, is seen reporting strong Q1 June 2011 results on the back of higher occupancy rates (OR) and higher average room rates (ARR). The re-opening of its Taj Heritage wing, Mumbai, will aid revenue growth. The bottom line will get a boost from lower interest costs post repayment of loans from warrants proceeds.
India's second largest software services exporter Infosys was fell 0.87%. During market hours today, Bank Chinatrust Indonesia and Infosys announced the successful implementation of Infosys' core banking solution Finacle.
Most metal stocks declined as LMEX, a gauge of six metals traded on the London Metal Exchange, dropped 2.07% on Wednesday, 3 August 2011. Hindalco Industries, Jindal Saw, Sterlite Industries, Jindal Steel & Power, Sail, Tata Steel, and Nalco shed by between 0.92% to 4.55%.
Hindustan Zinc fell 0.92%. The company has reportedly cut zinc prices by 2% to Rs 1,24,400 a metric tonne effective from today. It has lowered lead prices by 2.8% to Rs 1,30,400 a tonne.
JSW Steel slumped 3.45%. The company has denied the conclusions drawn in a report by the Lokayukta -- Karnataka's anti-graft watchdog -- against the company on procurement and transportation of iron ore in the state.
Shares of state-run oil marketing companies (PSU OMCs) surged on expectations that their losses on diesel sales could fall if the fuel is sold at a higher price to car users. Indian Oil Corporation (IOC) (up 3.47%), HPCL (up 3.99%) and BPCL (up 3.15%), edged higher. Lower crude oil prices also aided the rally. Lower crude oil prices could reduce under-recoveries of state-run oil marketing companies (PSU OMCs) on domestic sale of diesel, LPG and kerosene at controlled prices. The government has already freed pricing of petrol.
Aviation stocks rose as a fall in crude oil prices eased concerns about the impact of high jet fuel prices on operating costs of these companies. SpiceJet (up 0.67%) and Jet Airways (India) (up 1.32%) rose. Kingfisher Airlines fell 1.35%. Easing of crude oil prices may bring down prices of jet fuel, which accounts for over 50% of airlines' operating cost. Jet fuel prices are linked to crude oil prices.
Crude oil extended its recent slide in Asian electronic trade on Thursday, 4 August 2011, as worries about economic growth sparked concern about future demand. US September 2011 crude futures were down 1.03 dollars or 1.13% to $90.90 a barrel.
India's largest power generation firm NTPC lost 2.46% to Rs 176. The stock declined after the company's chairman Arup Roy Choudhury on Wednesday, 3 August 2011, said that the company's plans to acquire coal mines abroad have been hit by high valuations and proposed rule changes in Indonesia and Australia that could make the fossil fuel there more expensive. High coal prices have driven up valuations of mines. Also, the cost of coal produced will go up as Australia plans to levy a tax of A$23 ($24.79) for each metric ton of carbon emitted from 2012 and Indonesia is set to link the price of coal exported to international coal indexes this year.
NTPC, India's largest power producer, requires 164 million tons of coal this fiscal year through March to run its plants. The company, which meets part of its fossil fuel requirement through imports, has been scouting for overseas assets to secure raw material.
Realty stocks fell on worries higher interest rates could dent demand for residential and commercial property. Purchases of both residential and commercial property are largely driven by finance. DLF, HDIL, Indiabulls Real Estate and Unitech shed by between 0.65% to 5.54%.
Cipla lost 2.2% to Rs 305.55 as the pharmaceutical firm is seen reporting a muted 1.61% growth in net profit to Rs 261.56 crore in Q1 June 2011 over Q1 June 2010 tomorrow, 5 August 2011. The company's top line is expected to register a decent growth on the back growth in formulations exports led by the ramping up of its Indore Special Economic Zone (SEZ) facility and on growth in domestic formulations.
Cals Refineries clocked highest volume of 6.66 crore shares on BSE. Inventure Growth & Securities (4.7 crore shares), Lanco Infratech (65.68 lakh shares), Birla Power Solutions (53.31 lakh shares) and Shree Ashtavinayak Cine Vision (50.94 lakh shares) were the other volume topper in that order.
Inventure Growth & Securities clocked highest turnover of Rs 978.72 crore on BSE. JSW Steel (Rs 80.17 crore), State Bank of India (Rs 66.28 crore), Rushil Decor (Rs 53.31 crore) and Asian Paints (Rs 47.83 crore) were the other turnover toppers in that order.
The Q1 June 2011 earnings season is drawing towards a close. Investors are focusing on the post-Q1 June 2011 result management commentary to gauge the future earnings outlook at a time when Indian firms are witnessing cost pressures amid rising interest rates and staff costs.
Cipla and IL&FS Transportation Networks are set to announce Q1 results on Friday, 5 August 2011. M&M announces Q1 results on Monday, 8 August 2011. ABB, Tata Communications, Mahindra Satyam, GMR Infrastructure and VIP Industries announce quarterly results on 9 August 2011. Tata Power and Rural Electrification Corporation unveil Q1 results on 10 August 2011. Tata Motors, Reliance Infrastructure, Reliance Power, Castrol India and Shipping Corporation of India unveil quarterly results on 11 August 2011.
Tata Steel, Hindalco, Coal India, National Aluminium Company, Jaiprakash Associates, Unitech and HPCL unveil Q1 results on 12 August 2011. State Bank of India, Aditya Birla Nuvo and Shipping Corporation of India unveil Q1 results on 13 August 2011.
Monsoon rains are likely to pick up over most parts of the country in the next four to five days, after sharply slowing for two consecutive weeks during the most important sowing period for summer crops. A news agency quoted an unnamed senior official with the state-run India Meteorological Department (IMD) as saying that the country's important rice-and oilseed-growing regions, the eastern and central parts, are likely to receive more rains in the near future after getting intermittent showers in the past few days.
Rains were 22% below normal in the week to 3 August 2011, recording marginal improvement from 23% below average showers in the previous week. Total rainfall since the beginning of the June-September monsoon season has been 6% below average. Rainfall has been normal or above in 73% of the country so far this season, while 27% of the country is facing a deficit. In some parts of eastern India such as Orissa, Bihar and Jharkhand, rainfall is below normal, but in the key rice-growing state of West Bengal rainfall is above normal. A rainfall deficit in the southern state of Andhra Pradesh, a top rice-producer, has largely been bridged.
In the northern grain bowl region of Punjab, the monsoon rain deficit is 26%. However, since most farmland in Punjab is irrigated, rice production may not be adversely affected in the state. In Gujarat, rainfall is 37% below average. Low rainfall in the western regions is likely to adversely affect the output of groundnut, the second biggest summer-sown oilseed crop after soybean.
Food price index rose 8.04% and the fuel price index climbed 12.12% in the year to 23 July 2011, government data on Thursday showed. In the previous week, annual food and fuel inflation stood at 7.33% and 12.12%, respectively. The primary articles price index was up 10.99%, compared with an annual rise of 10.49% a week earlier.
The Reserve Bank of India (RBI) on Tuesday, 2 August 2011, tightened its rules on sales of derivative products, in a move aimed at preventing the mis-selling of these complex products to local firms. RBI said in a notification that no bank can be a "market maker" in a product that it can't price independently, even if it covers the risk from the deal with another bank immediately. A market maker is a financial middle-man, typically a bank, that helps the price discovery process and adds liquidity to the market by quoting both bid and ask prices for financial products.
The new rules prevent foreign banks from being market makers in a product if they can't price it locally. Banks must also now make sure that officials to whom they sell derivative products are backed by the board to execute such transactions, the RBI said. RBI didn't specify what derivatives are covered by the new rules.
The services sector expanded at its fastest clip in three months in July 2011, driven by solid expansion of new business, but input prices also rose faster, a survey showed on Wednesday, 3 August 2011. The HSBC Markit Business Activity Index, based on a survey of around 400 companies, rose to 58.2 in July from 56.1 in June, staying above the 50 mark that separates growth from contraction for the 27th consecutive month. The new business sub-index recorded its strongest growth since February, rising to 59.3 from 57.1, as demand improved and firms found new customers.
The economy will grow at 8.2% in the year to March 2012, but it faces a challenge in achieving the fiscal targets set in the annual budget, a top economic advisory panel said in a report released early this week. Headline inflation would remain close to 9% till October, before beginning to ease, and would be at 6.5% in March, the prime minister's Economic Advisory Council said.
Exports grew by an impressive 46% to $29 billion in June 2011, despite uncertainty in the US and European markets, the latest data showed. Merchandise exports had aggregated to $20 billion in June 2010. During the April-June quarter, overseas shipments grew by 46% to $79 billion, according to Commerce Ministry data released on Monday, 1 August 2011. Though imports grew by 42% to $37 billion in June, the trade deficit of $7.6 billion was almost half the level of $15 billion seen in May, lessening concerns over the country's balance of payments situation.
Growth in manufacturing sector fell for the third month in a row in July as a long series of interest rate hikes and faltering global demand weighed on new orders and output growth, a survey showed on Monday, 1 August 2011. The HSBC Markit Business Activity Index, based on a survey of around 500 companies, fell to a 20-month low of 53.6 in July from 55.3 in June, though it remained above the 50 mark that separates growth from contraction for the 28th consecutive month.
The Reserve Bank of India (RBI) raised its key lending rates by 50 basis points at a policy review on 26 July 2011, to tame high inflation. The RBI has raised its end March 2012 inflation target to 7% as against the previous estimate of 6%, saying inflation has been higher than its expectations. It kept its economic growth forecast of 8% for this fiscal year. The RBI revised downwards non-food bank credit growth projection to 18% for the year ending March 2012 (FY 2012) from 19% earlier.
Although the impact of past monetary policy actions is still getting transmitted, considering the overall growth and inflation scenario, there is a need to persevere with the anti-inflationary stance, the RBI said. Going forward, the monetary policy stance will depend on the evolving inflation trajectory, which, in turn, will be determined by trends in domestic growth and global commodity prices, the RBI said. A change in stance will be motivated by signs of a sustainable downturn in inflation, it added.
The uncertain global macro-economic environment poses a challenge for the domestic economy from the perspective of financing the current account deficit, RBI said. In this context, the composition of capital flows remains a concern. In recent months, some shift in composition of capital flows towards foreign direct investment (FDI) has been observed. This trend needs to be reinforced through policy actions to improve the quality of financing of the current account deficit, RBI said.
Congress President Sonia Gandhi has gone to the US, to undergo surgery for a medical condition, which the party did not disclose. Gandhi has named a four-member team to run party affairs during her absence
European stock markets dipped in the red on Thursday, 4 August 2011, reversing initial gains, ahead of interest-rate decisions from the Bank of England's Monetary Policy Committee and the European Central Bank. The key benchmark indices in France, Germany and UK were down by between 0.44% to 1.18%.
The Bank of England (BOE) on Thursday kept its monetary policy unchanged as the central bank policymakers continued to be trapped between higher-than-normal inflation and a slowing British economy. The nine-member Monetary Policy Committee left the bank's key lending rate steady at a record low 0.5% and left the size of its asset-purchase program unchanged.
Most Asian stocks fell on Thursday, 4 August 2011, extending their recent losses triggered by worries about a slowdown in the global economy. Many of the regional markets reversed the gains they made earlier after a positive finish on Wall Street on Wednesday, 3 August 2011. The key benchmark indices in South Korea, Singapore, Indonesia Hong Kong and Taiwan fell by between 0.49% to 2.31%. Mainland Chinese shares rose. The Shanghai Composite index was up 0.21%
Japanese stocks rose with exporters getting a lift as Japan intervened in the foreign-exchange market to stem the yen's recent rise. The Nikkei 225 average was up 0.23%.
The Bank of Japan announced additional monetary easing Thursday, while keeping its policy interest-rate target range unchanged at 0 to 0.1%.
Trading in US index futures indicated that the Dow could fall 79 points at the opening bell on Thursday, 4 August 2011. Dow futures reversed steep initial gains.
US stocks rose on Wednesday on speculation that the Federal Reserve might consider a new stimulus programme to boost the sagging economy. The Dow Jones Industrial Average gained 29.82 points or 0.25% at 11,896.44. The S&P 500 rose 6.29 points or 0.50% at 1,260.34 and the Nasdaq advanced 23.83 points or 0.89% at 2,693.07.
The US government's key monthly jobs report for July 2011 is due on Friday, 5 August 2011, and will be closely watched by investors to gauge the health of the world's biggest economy.
Daily News Roundup - Aug 4 2011
Dabur has introduced its Burrst Fizz brand to tap the potential in this segment. Burrst Fizz is available in two flavours - apple and lemon. (ET)
Wockhardt's sale of its nutrition business to Danone will fetch the drug maker much-needed cash, allowing it to pay up foreign currency convertible bondholders and reduce debt. (ET)
Power Grid Corporation of India is expected to raise Rs 25bn by issuing corporate bonds before the end of this month. The company would issue bonds in tenors ranging between four and 15 years, with a coupon rate of 9.50 per cent, said bond dealers. (BS)
Sensex sags on overseas woes…Nifty holds 5400
The Indian markets have been a bit volatile in the week so far, but the overall bias has been negative owing to the weak global backdrop. The key Indian indices today fell for the second straight trading session with the BSE Sensex dropping below 18,000. But the NSE Nifty managed to end above 5400.
Finally, the BSE Sensex ended at 17,945 losing 169 points. It had earlier touched a day's high of 18,005 and a day's low of 17,859. It opened at 17,970. The NSE Nifty closed at 5,404 losing 52 points.
Better, though not perfect!
A good plan, violently executed now, is better than a perfect plan next week. - George S. Patton.
The start today could be a tad better after US stocks snapped an eight-session losing streak. Asian markets are not doing too badly. The big question is whether we can covert any relief pop into wider gains. Given the macro-economic backdrop (both local and global), that may be slightly tough.
Locally, elevated inflation and its impact on interest rates is the biggest headwind. GDP growth forecast has also been scaled down. Monsoon has been below par. There are fears of the Government overshooting its budget deficit. Disinvestment is in a limbo. The Centre is under attack for a number of issues – from corruption to economic management. The RBI is no mood to relent even as it seeks support from New Delhi.
Record runs continue for bullions
Investors continue flock to bullions on growing concerns over US economy
Precious metals ended at record highs on Wednesday, 03 August 2011 at Comex. Gold prices soared with silver following it as investors flocked to precious metals following fears of another recession. Though private sector job report showed that US added more jobs than expected in July, ISM's service sector index and factory order reports disappointed. A weak dollar also led investors flock around bullions.
Markets may begin on a flat note
The Indian markets are set for a flat start tracking unsupportive Asian cues.
Headlines for the day:
Wockhardt seeks legal go-ahead for Danone deal
Monsoon to weaken now, says Met dept
GMR hopes to land Spain airport projects
Market likely to see dull start in opening trade, food inflation data eyed
The market is likely to see a flat-to-negative start following mixed global cues. Trading of S&P CNX Nifty on the Singapore stock exchange indicates a fall of 12 points at the opening bell. However some bargain hunting may emerge after the recent market slide to a 6-week closing lows on Wednesday. The government will today, 4 August 2011, unveil data on some wholesale price indices viz. the food price index, the primary articles index and the fuel price index for the year through 23 July 2011.
FIIs sold shares worth a net Rs 869.69 crore on Wednesday, 3 August 2011, as per provisional data from the stock exchanges. Domestic institutional investors (DIIs) bought shares worth Rs 422.48 crore on that day.
Wednesday, August 03, 2011
Coal India to invest in mining projects
Coal India (CIL) is likely to invest about Rs 28,000 crore in 68 mining projects having a production capacity of about 230 million tonnes per annum, Parliament was informed today.
"The estimated investment likely to be made in CIL and its subsidiaries for the purpose is Rs 27,946.42 crore and it would be mobilised from internal sources of the company," State Minister for Coal Pratik Prakashbapu Patil said in written reply in Lok Sabha.
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DB Corp, Sun TV
Indiainfoline NCDs open for subscription
The NCDs proposed under this Issue have been rated ‘[ICRA]AA- (stable)’ by ICRA, and ‘CARE AA-' by CARE.
There are three investment options.
Option I (Annual interest payment): The redemption date or maturity period is 36 months from the deemed date of allotment and the coupon rate is 11.7% p.a. The interest payment is annual and the face value plus any interest that may have accrued is payable on redemption.
Option II:. NCDs will be redeemed at Rs 1,446 at the end of 40 months from the deemed date of allotment with an effective yield of 11.70% per anum.
Option III (Annual interest payment): The redemption date or maturity period is 60 months from the deemed date of allotment. The coupon rate is 11.9% per annum for Category III investors and 11.7% per annum for others. The interest payment is annual and the face value plus any interest that may have accrued is payable on redemption.
Pay more for LPG if you earn more than 6L
The government should end subsidised domestic cooking gas (LPG) for people with income of more than Rs 6 lakh per annum, a Parliamentary Panel has suggested.
A 14.2-kg LPG cylinder in Delhi currently costs Rs 395.35. This is Rs 247 short of its market price. If the panel recommendation is accepted, people with more than Rs 6 lakh per annum household income will have to pay Rs 642.35 per bottle.
"...to offset the huge losses made on account of subsidised domestic LPG cylinders, the Government may consider to do away with providing subsidised LPG to rich and affluent people having an income of more than Rs 6 lakh per annum", it said.
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Gold prices soar
Gold prices soared further to attain yet another historic high at the domestic bullion market here today on hectic stockists and investment-driven buying fuelled by global bullishness.
Silver too witnessed a sharp spike to revisit its 3-month high on strong speculative build up amidst rising industrial demand.
Standard gold (99.5 purity) rallied by Rs 580 per 10 grams to end at Rs 23,955 from Tuesday's close of Rs 23,375.
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Sensex sags on overseas woes…Nifty holds 5400
Sensex ended at 17,945 losing 169 points. Nifty closed at 5,404 losing 52 points.
The Indian markets have been a bit volatile in the week so far, but the overall bias has been negative owing to the weak global backdrop. The key Indian indices today fell for the second straight trading session with the BSE Sensex dropping below 18,000. But the NSE Nifty managed to end above 5400.
BSE Bulk Deals to Watch - Aug 3 2011
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
3/8/2011 590006 Amrutanjan Health-$ CROSSEAS CAPITAL SERVICES PRIVATE LIMITED B 48444 926.29
3/8/2011 590006 Amrutanjan Health-$ A K G SECURITIES AND CONSULTANCY LTD B 55881 926.13
3/8/2011 590006 Amrutanjan Health-$ CHANDARANA INTERMEDIARIES BROKERS PRIVATE LIMITED B 32041 922.79
NSE Bulk Deals to Watch - Aug 3 2011
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
03-AUG-2011,AANJANEYA,Aanjaneya Lifecare Ltd,DIVINE VINCOM PRIVATE LIMITED,BUY,13397,398.48,-
03-AUG-2011,AANJANEYA,Aanjaneya Lifecare Ltd,JAROLI VINCOM PVT LTD,BUY,500000,397.05,-
03-AUG-2011,ABGSHIP,ABG Shipyard Limited,AASHIRWAD VINCOM PRIVATE LIMITED,BUY,500000,388.88,-
03-AUG-2011,AMRUTANJAN,Amrutajan Health Ltd,AXIS EQUITIES PRIVATE LIMITED,BUY,18373,923.03,-
03-AUG-2011,AMRUTANJAN,Amrutajan Health Ltd,CHANDARANA INTERMEDIARIES BROKERS P. LTD,BUY,31922,923.32,-
Sensex sinks 169 points on global worries
Fall across the globe due to growth worries disturbed the sentiment in India as well. The Sensex down 169 points and the Nifty down 52 points at the close
Major headlines
Bharti Airtel Q1 consolidated net profit down nearly 28%
CEAT Q1 net loss at Rs42 crore
Oberoi Realty Q1 consolidated PAT surges 33%
Sensex, Nifty near 6-week closing lows
Key benchmark indices extended recent losses and settled near their lowest closing level in nearly 6 weeks on concerns that higher interest rates will crimp corporate profit growth. The barometer index BSE Sensex fell below the psychological 18,000 mark. The Sensex shed 169.34 points or 0.94%, up close to 80 points from the day's low and off close to 65 points from the day's high. The market breadth was negative.
The Sensex has tumbled 930.74 points or 4.93% in seven trading sessions from a recent high of 18,871.29 on 25 July 2011, hit by the Reserve Bank of India's (RBI) aggressive rate hike at a policy review on 26 July 2011. A number of commercial banks have raised lending rates recently after RBI raised its key lending rate by 50 basis points.
Daily News Roundup - Aug 3 2011
Wockhardt Ltd has agreed to sell its nutrition business to Danone for about US$356 million. more than double the amount at which it had signed a similar deal with US pharmaceutical giant Abbott a year ago. (BS)
In a bid to boost sagging sales of passenger vehicles, Tata Motors has firmed up plans to restructure its local dealership network in the course of this financial year. (BS)
Sensex and Nifty lose 1% each in all-round selling
After two straight days of upswing, the Indian equity markets ended in the red, as investors remained risk averse amid speculation of further rate hikes and earnings downgrades. Weak global markets also affected sentiment on the domestic bourses after downbeat manufacturing data from Australia to the US fueled worries about the state of the world economy.
The BSE Sensex ended at 18,109, down 204 points or 1.1%. It had earlier touched a day's low of 18,037 after opening at day's high of 18,283.
Odds against us!
A recovery is not ruled out after the recent selloff. We expect the down-trend to worsen with medium term support for the Nifty likely at ~5370 levels.
If you don't prove yourself against the odds then how can you be worthy for the evens? - Anonymous.
World markets are going through yet another rough patch, with the Dow down for eight straight days. The S&P 500 is in the red for 2011. This is Wall Street’s worst losing streak since October 2008.
The initial euphoria over the US debt deal has given way to apprehensions about the health of the global economy. The eurozone credit crisis also keeps rearing its ugly head intermittently.
Risk aversion is on the rise, with the Swiss franc hitting record high versus the euro. Gold and government bonds too are seeing ‘flight-to-safety’ buying.
The opening is likely to be pretty weak amid a world-wide carnage. The rest of the day’s proceedings will hinge on how overseas markets perform. A recovery is not ruled out after the recent selloff.We expect the down-trend to worsen with medium term support for the Nifty likely at ~5370 levels.
Equities and other risky assets are not on the buying list for the time being unless you are willing to patiently wait it out. Stay lighter till the near-term uncertainties ebb. Given the global economic backdrop, India’s 8% GDP growth may not be that bad. Medium-to long-term investors could look at quality stocks at lower levels.
FIIs were net sellers of Rs. 2.01bn in the cash segment on Tuesday, according to the provisional NSE data. The domestic institutional institutions (DIIs) were net buyers at Rs. 1.39bn on the same day. FIIs were net sellers at Rs. 6.51bn (provisional) in the F&O segment.
Precious metals witness sharp gains
Investors flock to bullions on growing concerns over US economy
Precious metals ended at record highs on Tuesday, 02 August 2011 at Comex. Gold prices soared with silver following it as investors flocked to precious metals following a report from the Commerce Department that consumer spending in US dropped in June. Prices rose despite a s steady dollar. Ongoing concerns about the sluggish pace of the economy's recovery pushed prices higher.
Market may extend losses on weak Asian stocks; Bharti Airtel in focus
The market may extend losses on weak Asian stocks. Trading of S&P CNX Nifty on the Singapore stock exchange indicates a fall of 82.50 points at the opening bell.
FIIs sold shares worth a net Rs 201.68 crore on Tuesday, 2 August 2011, as per provisional data from the stock exchanges. Domestic institutional investors (DIIs) bought shares worth Rs 139.88 crore on that day. Weak global stocks dragged Indian shares to 5-1/2-week closing lows on Tuesday, 2 August 2011. The BSE Sensex was down 204.44 points or 1.12% to 18,109.89, its lowest closing level since 23 June 2011.
Markets may fall at start on global growth fears
Economy fears have rattled markets across the globe, which may drag the Indian indices in the opening trade.
Headlines for the day:
HDFC raises home loan rates by 50 bps
Bank staff to go on strike on August 5
Maharashtra govt rules out CBI probe into Ambani home land dispute
Today's Stock Picks - Reliance Communications - Aug 3 2011
NIFTY
Current: 5,457 (Aug fut: 5,467),
Target: NA
The index breached support at 5,450 intra-day before a small recovery. It looks bearish. Three strategies come to mind. 1) Short August future with a stop loss at 5,500 and a 3-session target of 5,300.2). Bearspread with long 5,400p (72) and short 5,300p (42) - net cost of 30, max gain of 70. 3). Long 5,500c (82) and long 5,400p (72). This long strangle will gain 20-25 if the market swings 100 points either way.
Check the other stock picks
US Stocks plunge on economy concerns
The stock market fell sharply Tuesday because investors have grown increasingly worried about the economy.
The Standard & Poor's 500 index lost 33 points, or 2.6 percent, and is now down 0.3 percent for the year. The Dow Jones industrial average fell 266 points, or 2.2 percent, and is now up just 2.5 percent for the year.
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Nifty heading lower today
The 50-share Nifty index is expected to open lower on Wednesday tracking weak Asian markets while investors will keep a close watch on Bharti Airtel ahead of its quarterly results and DLF Ltd which reported its quarterly results post market hours.
According to ET now estimates the telecom giant is expected to post 4% growth in top line. India & South Asian revenue is expected to grow 3.1%. Revenue is expected to decline nearly 1% QoQ while in paisa terms it may translate to 43 paise. Overall EBIDTA margins are expected to improve by 55 bps.
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Tuesday, August 02, 2011
Piramal Healthcare Q1 cons net profit at Rs89 cr
Piramal Healthcare has announced the following results for the quarter ended June 30, 2011
Standalone Results
The Unaudited results for the Quarter ended June 30, 2011
The net profit of the company stood at Rs101.09 crore for the quarter ended June 30, 2011 whereas the same was at Rs66.91 crore for the quarter ended June 30, 2010.
The total income of the company came in Rs334.83 crore for the quarter ended June 30, 2011 whereas the same was at Rs599.73 crore for the quarter ended June 30, 2010.
Consolidated Results
The Unaudited consolidated results for the Quarter ended June 30, 2011
The net profit of the group came in Rs89.23 crore for the quarter ended June 30, 2011 whereas the same was at Rs80.74 crore for the quarter ended June 30, 2010.
The total income of the group stood at Rs511.96 crore for the quarter ended June 30, 2011 whereas the same was at Rs866.22 crore for the quarter ended June 30, 2010.
The figures for the quarter ended June 30, 2011 are not comparable to the previous quarter on account of the sale of Domestic formulation business and Diagnostics Services.
Piramal Healthcare closed at Rs380.65, down by 0.31%, with a volume of 0.26 lakh shares on the BSE
Power Grid Q1 net profit at Rs705 cr
Power Grid Corporation of India announced the following unaudited results for the quarter ended June 30, 2011:
The net profit of the Company advanced by 0.30% to Rs705.29 crore for the quarter ended June 30, 2011 as compared to Rs703.18 crore for the quarter ended June 30, 2010.
Total Income surged by 9.11% to Rs2345.73 crore for the quarter ended June 30, 2011 to Rs2149.69 crore for the quarter ended June 30, 2010.
Power Grid Corporation closed at Rs107.75, up by 0.23%, with a volume of 2.04 lakh shares on the BSE.
FMPs - is it good to invest in them ?
With short term interest rates of less than a year looking good, it is not only banks which are coming up with attractive one-year deposits. Mutual funds too have been launching a number of one year close-ended debt products called Fixed Maturity Plans (FMPs) that could offer attractive yields.
However, there is the catch. Despite higher risk compared with deposits, FMPs, which typically invest in debt instruments for a fixed period, be it money market instruments or government and corporate bonds, were seen a superior option to bank deposits, due to their lower tax incidence. This is set to change if the revised draft of Direct Tax Code (DTC) is to be adopted in its current form from April 2012. Here's a quick recap on what made FMPs superior to Fixed Deposits (FDs) so far and how investors have to be selective with FMPs from hereon, if they have to enjoy optimal post-tax returns.
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BSE Bulk Deals to Watch - Aug 2 2011
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
2/8/2011 590006 Amrutanjan Health-$ RKSV SECURITIES INDIA PRIVATE LIMITED B 18195 899.52
2/8/2011 590006 Amrutanjan Health-$ CROSSEAS CAPITAL SERVICES PRIVATE LIMITED B 132311 913.67
2/8/2011 590006 Amrutanjan Health-$ A K G SECURITIES AND CONSULTANCY LTD B 200036 914.04
NSE Bulk Deals to Watch - Aug 2 2011
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
02-AUG-2011,AMRUTANJAN,Amrutajan Health Ltd,A K G SECURITIES AND CONSULTANCY LTD.,BUY,20221,910.83,-
02-AUG-2011,AMRUTANJAN,Amrutajan Health Ltd,AJAY,BUY,18982,915.38,-
02-AUG-2011,AMRUTANJAN,Amrutajan Health Ltd,AXIS EQUITIES PRIVATE LIMITED,BUY,31001,906.30,-
02-AUG-2011,AMRUTANJAN,Amrutajan Health Ltd,BP FINTRADE PRIVATE LIMITED,BUY,40077,925.23,-
02-AUG-2011,AMRUTANJAN,Amrutajan Health Ltd,C D INTEGRATED SERVICES LTD.,BUY,48154,918.75,-
02-AUG-2011,AMRUTANJAN,Amrutajan Health Ltd,CHANDARANA INTERMEDIARIES BROKERS P. LTD,BUY,76080,917.51,-
Realty, metal drag Sensex 204 points lower
Weak global peers and heavy selling in realty, banking & metal stocks led the decline in today’s trade. The Sensex slips 204 points and the Nifty drops 60 points
Major headlines
JP Associates July cement sales surge 18%
Piramal Healthcare Q1 consolidated net profit at Rs89 crore
Telecom scrips dip on new policy
Nifty August 2011 futures below 5500
ICICI Bank, RIL August 2011 futures at premium
Nifty August 2011 futures were at 5,467.45, at a premium of 10.90 points over spot closing of 5,456.55. Turnover in NSE's futures & options segment surged to Rs 95800.63 crore from Rs 76025.83 crore on Monday, 1 August 2011.
ICICI Bank August 2011 futures were at 1030.20, at a premium over spot closing of 1025.
Sensex drops 4% in six days on earnings growth worries
Weak global stocks dragged Indian shares to 5-1/2-week closing lows. The BSE Sensex was down 204.44 points or 1.12%, up close to 70 points from the day's low and off close to 175 points from the day's high. Index heavyweight Reliance Industries came off the 52-week low. The market sentiment remains edgy, with investors worried that higher interest rates will crimp corporate profit growth. A number of commercial banks have raised lending rates recently after the central bank raised its key lending rate by 50 basis points at a policy review early last week.
The Sensex has tumbled 761.40 points or 4.03% in six trading sessions from a recent high of 18,871.29 on 25 July 2011, hit by the Reserve Bank of India's (RBI) aggressive rate hike at a policy review on 26 July 2011.
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Grey Market Premiums - Vaswani Industries, L&T Finance
| Company Name | Offer Price (Rs.) | Premium (Rs.) |
| Vaswani Ind. | 49 | 1.50 to 2 |
| Inventure Growth | 117 | 4 to 4.50 |
| L & T Finance | 52 | 1.50 to 2 |
Weak global cues may weigh on markets at start
The Indian indices head towards a lower start tracking losses across the globe due to weak US manufacturing data.
Headlines for the day
JSW Steel faces brunt of mining ban
Two-wheelers' July sales rise 13%
Orchid Chem to make drugs in 3 new segments
Crude slips due to weak economic data
Strong dollar puts further pressure on oil price
Crude-oil futures slipped on Monday, 01 August 2011 at Nymex after reports showed a weaker than expected manufacturing data for last month. The dollar headed up strongly putting further pressure on oil. Crude fell in tandem with equities.
Light sweet crude for September delivery lost $0.81 or 0.9%, to $94.89 a barrel on the New York Mercantile Exchange. It traded as high as $98.61 a barrel on the day.
Bullion metals lose some of their sheen
Strong dollar takes away some shine
Bullion metals lost some of their sheen on Monday, 01 August 2011 as the dollar rallied on news that U.S. lawmakers prepared to vote on a deal to raise the debt ceiling and deal with deficits. A weaker than expected ISM data put the losses under check.
Gold for December delivery lost $9.5, or 0.6%, to settle at $1,621.7 an ounce on the Comex division of the New York Mercantile Exchange on Monday. It earlier traded as low as $1,608.2 an ounce.
Market may open lower on weak Asian stocks; DLF in focus
The market may open lower on weak Asian stocks. Trading of S&P CNX Nifty on the Singapore stock exchange indicates a fall of 47.50 points at the opening bell. Asian stocks dropped on Tuesday, 2 August 2011, with exporters broadly pressured after fresh indications that US manufacturing is slowing, and with Japanese companies straining under the weight of a strong yen.
FIIs bought shares worth a net Rs 86.83 crore on Monday, 1 August 2011, as per provisional data from the stock exchanges. Domestic institutional investors (DIIs) sold shares worth Rs 95.26 crore on that day.
Daily News Roundup - Aug 2 2011
NHPC would invest around Rs150bn for developing two projects in the neighbouring country Myanmar. (ET)
As many as 20 power generating companies, including NTPC, Tatas, Adani and Essar group, have put in their initial bids for executing the 4,000-MW ultra mega power project (UMPP) in Orissa. (ET)
ABB India has won orders worth Rs160mn to supply turnkey power and automation solution for three photovoltaic solar power plants with a combined capacity of 11 megawatts (MW) in India. (ET)
Sensex ends static in choppy trade
The Indian equity indices ended almost unchanged on Friday, taking a breather after three straight days of losses. It was a volatile session, with the NSE Nifty swinging between a low of 5450 and a high of 5520 levels.
Realty, Metals and Oil & Gas stocks were among the major laggards. The Mid-Cap and the Small-Cap stocks saw some offloading as well. However, bucking the negative trend were FMCG, Banking and Telecom stocks.
A lot remains to be done
One never notices what has been done; one can only see what remains to be done. -Marie Curie.
Well, looks like the euphoria over the US debt deal has given way to concerns about the health of the global economy. Manufacturing PMI reports from Australia to the US have shown continued moderation. Concerns have also surfaced over the adverse implications of the large spending cuts in the US on the world’s largest economy. In addition, a possible downgrade of the US debt rating is still lurking.
A new version of Maruti Swift ...
Competition and capacity issues have led to a drop in market share for Maruti’s premium hatchback. A new version aims to re-capture it.
Maruti Swift few years ago, the country’s largest car maker Maruti Suzuki had two choices. It could continue flogging its old war horse, the Swift, which was launched in 2005, for a few more years and sell similar volumes, even though it was aware that the product cycle of cars are increasingly shrinking.
Monsoon below normal
The India Meteorological Department (IMD) has forecast ‘below normal' rainfall for the country during the second half (August-September) of the current south-west monsoon season.
This comes even as the first half (June-July) has turned out to be not so bad, with the monsoon showers being reasonably well spread, both in spatial as well as temporal terms.
Read more
Sensex spurts on global rally...Nifty reclaims 5500
BSE Sensex ended at 18,314 adding 117 points. Nifty closed at 5,516 up 35 points.
The Indian equity markets ended the day with healthy gains, starting off the week on a high after US leaders announced they had reached an agreement to raise the nation's borrowing limit and avert a default. Markets in Asia and Europe welcomed the relief from the US on the critical issue of debt limit.
BSE Bulk Deals to Watch - Aug 1 2011
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
1/8/2011 533412 Aanjaneya Lifecare AMBER ENCLAVE PRIVATE LIMITED S 84409 378.41
1/8/2011 590006 Amrutanjan Health-$ CROSSEAS CAPITAL SERVICES PRIVATE LIMITED B 18119 878.59
1/8/2011 590006 Amrutanjan Health-$ CROSSEAS CAPITAL SERVICES PRIVATE LIMITED S 18119 876.43
NSE Bulk Deals to Watch - Aug 1 2011
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
01-AUG-2011,AMRUTANJAN,Amrutajan Health Ltd,CROSSEAS CAPITAL SERVICES PVT. LTD.,BUY,18109,876.07,-
01-AUG-2011,ARSSINFRA,ARSS Infra Proj. Ltd,SARAVANA STOCKS INVT. P LTD.,BUY,110000,391.55,-
01-AUG-2011,BASML,Bannari Amman Spinning Mi,ACCURATE FINSTOCK PVT LTD,BUY,81144,75.21,-
01-AUG-2011,BGLOBAL,Bharatiya Global Info Ltd,CROSSEAS CAPITAL SERVICES PVT. LTD.,BUY,171928,28.53,-
Markets participate in global rally; Sensex up 117 pts
Today's rally is driven by some relief on the US' debt worries, with the Sensex snapping four-day fall to close the trade 117 points higher
Major headlines
Exports rise 46.45% to $29.21 billion in June
M&M auto sales up 41% in July
India’s GDP to grow by 8.2% in FY12: PMEAC
Auto shares advance after mixed July sales data
A rally in world stocks triggered by US President Barack Obama's announcement over the weekend that he and Senate leaders had agreed on a "framework" debt deal to cut spending and raise the debt ceiling, helped Indian shares recover from a recent steep slide triggered by worries that higher interest rates will crimp corporate profit growth. US is the world's biggest economy. The BSE Sensex jumped 117.13 points or 0.64%, up close to 95 points from the day's low off close to 125 points from the day's high. The market snapped a four-day losing streak. Index heavyweight Reliance Industries (RIL) recovered in choppy trade after hitting 52-week low.
Monday, August 01, 2011
Positive Asian cues may lift markets at start
The Indian markets are set to begin the new month on a positive note as US reaches debt agreement, lifting Asian indices.
Headlines for the day:
Govt keen to decontrol diesel, LPG prices: FM
New bank licences on the back burner
Pension plans: Irda set to drop 4.5% guaranteed return rule
Bullions shine in July
Gold and silver rise 8.5% and 9% in July respectively
Gold futures ended at a record Friday, 29 July 2011 at Comex thriving on bad news about the U.S. economy and after House leaders postponed a vote on the U.S. debt plan.
Gold for December delivery added $15, or 0.9%, to settle at $1,631.20 an ounce on the Comex division of the New York Mercantile Exchange. It earlier traded as high as $1,637.50 an ounce.
Crude slips almost 2% on debt concerns on Friday
Crude stays steady for the month of July
Crude-oil futures slipped nearly 2% on Friday, 29 July 2011 at Nymex after reports showed that the U.S. economy grew less than expected in the second quarter and as the country's debt concerns stoked worries about energy demand.
Light sweet crude for September delivery lost $1.74, or 1.8%, to $95.70 a barrel on the New York Mercantile Exchange, the lowest for a front-month contract in two weeks. It traded as low as $94.95 a barrel on the day.
Market may gain on firm Asian stocks
The market may snap four days losses on firm Asian stocks, which rose as President Barack Obama announced a framework debt-limit deal. Trading of S&P CNX Nifty on the Singapore stock exchange indicates a gain of 59.50 points at the opening bell.
FIIs sold shares worth a net Rs 464.03 crore on Friday, 29 July 2011, as per provisional data from the stock exchanges. Domestic institutional investors (DIIs) bought shares worth Rs 411.82 crore on that day. Key benchmark indices reached five-week closing lows on Friday on weak global stocks. The market extended losses for the fourth day in a row in what was a choppy trading session on Friday. The BSE Sensex lost 12.32 points or 0.07% to settle at 18,197.20, its lowest closing level since 23 June 2011.
Daily News Roundup - Aug 1 2011
Bharat Heavy Electricals technology-sharing arrangement with Alstom for manufacturing supercritical boilers in India will continue unaffected by the French engineering major's recent global pact with Chinese equipment firm Shanghai Electric. (BL)
At least five projects of the DB realty linked to the government sector have been scrapped, put on hold or are struggling for approvals, while 10 of their own 13 projects are behind schedule. (FE)
Petronet LNG has evinced interest in setting up an LNG (Liquified Natural Gas) terminal along the Orissa coast with a cost of Rs.40-50bn. (BS)
Sensex ends static in choppy trade
The Indian equity indices ended almost unchanged on Friday, taking a breather after three straight days of losses. It was a volatile session, with the NSE Nifty swinging between a low of 5450 and a high of 5520 levels.
Realty, Metals and Oil & Gas stocks were among the major laggards. The Mid-Cap and the Small-Cap stocks saw some offloading as well. However, bucking the negative trend were FMCG, Banking and Telecom stocks.
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